He notes that music companies already take a cut of money made from concerts, merchandise and endorsements. So he thinks that should, at the very least, offset the cost of the recorded music to consumers, who’ve been increasingly willing to pay big prices to see artists live.
“Music companies would be better served by increasing their focus on how to make artists’ music, and especially their concerts, even better,” MacDonald says.
Nice thought, but not realistic, says Thomas Carpenter, general counsel for legislative affairs for the American Federation of Television and Radio Artists, a union that represents people working in the entertainment industry.
As it stands, he says 90 percent of the earnings that a musician currently makes under a recording contract is tied directly to royalties from sales, including lawful downloads. For actors, he says, it’s about 50 percent.
“There’s a lot at stake — much more than most people realize,” Carpenter says.
And he adds, “You have to be paid in order to be good. You have to use the funds from your projects to fund your future creativity.”
Still even some people who’ve spent their careers defending copyrights say it’s time to find some middle ground.
“It really is a failure to come up with practical, reasonable models for sales and distribution,” says Michael R. Graham, a Chicago attorney who specializes in trademark and copyright law. “There’s a real disconnect.”
Like many, he thinks iTunes has set the standard for the future.
Another possible approach: licensing agreements — with online services, for instance, paying a fee to content creators so they can provide it to consumers for free or for a monthly subscription fee.
Popular options, so far, include online music streaming services such as Spotify and Pandora. Others point to movie and TV services such as Netflix, though some complain that content on Netflix’s online streaming service is still too limited. Hundreds of thousands of people also quit Netflix last year after it started charging more to those who wanted both the streaming service and DVDs sent to them in the mail — another indication of just how much impact the public can have in these matters.
A major lawsuit now before a federal appeals court has put a spotlight on these issues.
Viacom Inc. is appealing a lower court ruling that found YouTube, Google Inc.’s popular video sharing service, is protected from copyright infringement claims. Viacom claims that YouTube is making millions when people post copyrighted videos —including some shows Viacom owns. YouTube says it forces people to remove the content when discovered, as the law allows.
During October proceedings before the 2nd U.S. Circuit Court of Appeals in Manhattan, Judge Roger Miner asked, “How in the world can damages be computed here?”
“The number could be quite large,” said Viacom attorney Paul Smith.
Miner responded: “Maybe what you’re really looking for is a license agreement.”
Smith said that was possible — an outcome that some would consider a win for those who want greater access to content on the Internet.
Whatever happens, college student Omar Ahmad says the entertainment industry has to realize that people his age aren’t likely to change their piracy habits, even with the threat of more serious punishments that Congress is considering.
“They’re going to continue doing it — that’s the truth,” says Ahmad, a senior at Seton Hall University who’s also manager of the New Jersey school’s radio station.
Karaganis at Columbia agrees that young people and the Internet community in general have proven they can influence the entertainment industry, whether it likes it or not.
“Change is inevitable,” he says. “The question is how quickly will it happen — and how much of a fortress will be built around intellectual property in the meantime.
“Now, I think all bets are off.”
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.