LimeWire Owes The Major Labels 75 Trillion

When the file-sharing service LimeWire was shut down for copyright infringement in 2010, you would have thought that the RIAA got exactly what it wanted. After all, shutting down a major source of digital music piracy should be considered a victory in a war where the RIAA has had few.

But no, that wasn't enough. Now the RIAA and 13 of the record labels that it represents are sueing LimeWire for the grand amount of $75 trillion. That's right, "trillion" with a T. That's 75,000 billion and 75,000,000 million, if you're counting.

The RIAA determined this absurd figure by identifying just 11,000 songs they felt were infringed. Figuring that each one was illegally downloaded thousands of times at the maximum damage award rate of $150,000 per download, they came up with the magic number.

Let's put the $75 trillion into perspective. The US economy is around $14 trillion per year, and the entire world's economy is around $60 trillion a year. That means that the entire world economy couldn't pay the maximum damages the RIAA thinks it should receive!

Now the judge isn't swayed by the RIAA's claim and will most certainly rule that each infringed song is worth just a single award regardless of the number of illegal downloads, but that would mean that the final number would still be in the billion dollar range.

What are the chances that the RIAA picks up that billion (let alone $75 trillion)? Probably zero.

All of these numbers are posturing for headlines. By throwing out absurd numbers like $75 trillion, the RIAA gets people like me to write about them (you're welcome, guys). It increases the chances of a larger settlement, since almost anything less than a trillion sounds like a victory. It makes the attorney's look good.

Does it help the music business as a whole? Does it move music along it's path of evolution? Does it help the music fan? Does it help the artist or band? The answer to all is "no." Whatever judgement is awarded will go directly to the bottom line of the labels with a hefty sum off the top to the attorneys. The artists will be lucky to see pennies on the dollar.

That's the remnants of the Music 2.0 music economy at work. Long live Music 3.0, where the artist takes control. May it happen ever more quickly.

You can read more about the case on law.com.

-----------------------------------

Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

Record Labels Claim They Lost $75 Trillion To Piracy

Yes, you read the headline correctly. When asked to estimate the damages they incurred in their suit against file-sharing service Limewire, the major record labels claimed they lost $400 billion (with a "B") on the low end, to $75 trillion (with a "T") on the high end. This is what they estimate they've lost to piracy in the 10 years of its existence.

OK, let's look at how incredibly grossly inflated those figures are. First of all, $75 trillion is more than the GDP of the entire world, which was only $59.62 trillion when last calculated in 2008 (you can bet it hasn't gone up since then).

Now let's look at the low end of $400 billion. In 2010 the world-wide revenue from recorded music was $35.1 billion, and the US portion of that was $12.6 billion, according to eMarketer:Global Music. And how does that add up to $400 billion? Even over 10 years at a generous 20% loss, it still only adds up to $25 billion. And recent figures by the NPD group found that only 16% of Limewire users downloaded music at it's peak, and the figure in later years was closer to 9%. Regardless which figure you go with, the numbers thrown out by the labels are completely absurd.

Luckily, the judge saw through the farce and called it like it is - ridiculous.

This is the problem with the music business today. It's all about the money. If record labels and the conglomerates that own them would concentrate more on the music than the accumulation of green, we'd have a much healthier business with more quality music and lots more fans that want to buy it. Fat chance of that happening.

-----------------------------------

Help support this blog. Any purchases made through our Amazon links help support this website with no cost to you.

You should follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.

The Pirates Fight Back

In what looks to be an escalation in the RIAA's (the recording industry's trade group) war on piracy, the pirates are now fighting back. Possibly because of the injunction that the RIAA won last week against the illegal file-sharing service Limewire, RIAA.com was hacked on Friday and taken off the air. The site returned on Friday night and has been on the air since.

A group calling itself "Anonymous" claimed responsibility for the act and announced "Operation Payback" intended as a means of making life as difficult for the trade group as it's made on the music industry's customers that it sued.

Operation Payback seems to be no more than a nuisance to the RIAA, but they're trying to make it as painful as possible. Anonymous started by publishing personal details of RIAA head Mitch Bainwol and his wife, then published office phone and fax numbers in the hopes of causing enough of a disruption as to take the industry group's mind off of the pirates.

I'd venture to say that the RIAA has never gone up against someone willing to fight dirty before. The developments should make for an interesting story to follow over the next few months.

-----------------------------------

Follow me on Twitter for daily news and updates on production and the music business.

Check out my Big Picture blog for discussion on common music, engineering and production tips and tricks.