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Turning the Play Button into the Pay Button
By Eric de Fontenay (Founder & Publisher)
(more articles from this author)
2002-09-23
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In a speech at the Optical Storage Symposium, Consumer Electronics Association President and CEO, Gary Shapiro, appealed to the content community "to work with, not against, the technology industry." While acknowledging the "critical juncture in history when the inevitable growth of technology is conflicting with the rising power and strength of copyright owners," he noted that the clash "need not be fatal... By protecting content at the source, content providers can be assured their intellectual property rights are respected, while consumers can enjoy unimpeded personal use."

No one would disagree that the content community, and music industry in particular, "has gone on a scorched earth campaign, attacking and burning several new recording and peer-to-peer technologies". But the conflict between the technology and content industries goes back to well before the emergence of the Internet & Napster. The conflict results from two very different, some may say totally diverging, objectives sought by each side.

The tech industry, broadly including everything from software and devices to infrastructure, for its part depends on their customers having easy and affordable access to content in order to generate demand for their products: the more content, the greater use for high-tech gadgetry. The content industry's concern on the other hand centers on the ability to monetize on the use of its assets. This diverging goals manifest itself in nearly every facet where both are involved, whether it be SDMI, marketing strategies (remember Gateway, Apple & some telcos as well as TDK's 2002 Jammy Awards. For example, for the technology sector, it's not which format might best prevents illicit copying and distribution, but which format is most likely to be adopted by consumers, and consequently generate music player sales. This is not to say that there is not a concern over piracy, but rather that there are other overriding issues at play. But it goes beyond strategic goals: the issue of piracy in a digital world is an old issue for the technology sector, particularly software, where experience has shown that flexibility towards the issue may achieve the best balance. Actions such as suing the major ISPs that make up the Internet's backbone to block specific servers or forcing Verizon to provide confidential customer information, frightens the tech sector to the core. When cornered, instinct dictates to fight back.

Does that mean that tech & content are doomed to conflict versus collaboration? What history has shown is that technology is often the content owner's best friend, even despite the latter's best efforts to hamper its spread. Whether it's the phonograph, free over-the-air TV & radio broadcast or video recording, technological innovation has nearly always resulted in greater demand for existing content as well as the creation of entirely new markets. We may not understand how or why technology that appears at first glance to be a threat nearly invariably becomes an ally. But in each prior case, it is not until content owners adjusted to the new environment with transformed business concepts and emerging markets that those benefits have been realized. History has also shown that even in the case where the content owner is not paid for every play (such as terrestrial radio & performing artists), the beneficial impact it has on other revenue sources (CD, concert ticket and/or merchandising sales) can more than compensate.

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Related News from Mi2N:
» CEA's Shapiro Challenges Copyright Community's Attack On Consumers And Technology
» Gateway Supports Consumers' Digital Music Rights


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