History -- 1998 to Present -- Music's Grand Spiral O' Death -- 2001

Please note that most dates on this page link to articles in the Boycott-RIAA news archives or other publications.
The date shown is when the article was posted and not necessarily the day the events described took place.

General Notes

mp3.com spends the entire year getting sued by anyone who didn't get to it last year, then gets bought out by Universal.

Napster suffers pretty much the same legal piling-on, loses their battle with the RIAA and shuts down on July 3.

The RIAA announces figures indicating that they had shipped more CDs in 2000 than ever before. Hilary Rosen points at the singles market (down 39%), which the industry has been trying to kill off for 10 years already, blames Napster.

Microsoft adds the "phone home" feature in its Windows XP release, which they've been looking for an excuse to deploy since Windows 3.

Napster -- mp3.com -- EMusic -- DRM -- RealNetworks

Within this Page -- Quotes -- Artist Activity -- Other 2001 Stories


 

Quoteable Quotes

January 12 -- Quotes from Senator Orrin G. Hatch, speaking at the Future of Music Policy Summit.

"I am excited about the future of music in the dawning digital world, both as a consumer and as a creator."

"I am a big music fan. Ask anyone who has visited me in my office and seen the stacks of CDs piled around my stereo. Some of the brave ones have even listened to a number of my songs from some of those stacks. When I was growing up, my parents, though poor, saved enough money to get me tickets up in peanut heaven to hear the Pittsburgh symphony and to get me violin lessons. The love of music instilled in me early has stuck with me to this day. I think it is wonderful that it is getting easier to access the music I enjoy from anywhere I go. And since I love so many types of music - I was delighted that our Committee hearings last year allowed me to be introduced to the subtle pleasures of Metallica - I, like most music fans, am excited about the possibility of having virtually any music I want at my fingertips without dragging a case of CDs with me."

"New digital music technology holds potential for artists as well. I have heard from many who are excited about the promise it holds for them. I know something of what it means to write a song. It's hard work, using the deepest resources of your soul to best express the truth as you feel it. But rarely does it pay off for most who make the investment. I attended an event with a number of members of the American Society of Composers and Publishers, and I mentioned to them that I had received my own first $60 royalty check for my songwriting. Yep, sixty big ones. Luckily, I have a day job, which I intend to keep for a while [- or at least until I find my music on Napster and know I've made it big]. Marilyn Bergman mentioned to me that those in the room were especially impressed because most of them will never get a royalty check of any size. It is a sad reality that for every Sheryl Crow or Billy Joel there are thousands who cannot ever support themselves or their families on income from music, even though they may be equally talented. But new distribution systems may be changing that to some degree."

"I do not think it is any benefit for artists or fans to have all the new, wide distribution channels controlled by those who have controlled the old, narrower ones. This is especially true if they achieve that control by leveraging their dominance in content or conduit space in an anticompetitive way to control the new, independent music services that are attempting to enhance the consumer's experience of music."

Ted Cohen of EMI Records doesn't agree. "I don't think he [Hatch] understands all the issues. I think he needs to spend some more time sitting down with people from the industry and then make a studied decision on what needs to be done."

General Notes -- Quotes -- Artist Activity -- Other 2000 Stories

Artist Activity

January 5 -- Dave Matthews Band announced that they are offering "I Did it", a new song from their upcoming album "Everyday" for free online from the band's website. The song is available as a download in 128K MP3 or Liquid Audio format, and also can be streamed in Real Audio or Windows Media format at 56K. The new album, Everyday, is due out on February 27, 2001.

January 12 -- In a first from a major label, the Dave Matthews Band's latest single "I did it", which was offered for free download starting last week will be spotlighted on Napster.

February 6 -- Country superstar LeAnn Rimes, long involved in multiple litigation against her label, Curb Records, and her former management, has issued a statement disclaiming any association with her new album, I Need You.

The album, released a week ago, primarily contains "unfinished material and songs that didn't make other albums," she wrote in a statement issued over the weekend. "This album was made without my creative input." LeAnn especially wants to emphasize to her fans that it's "not a reflection of myself as an artist, but is solely the conception of Curb Records, and for that I am truly and deeply sorry."

Curb Records issued a counter-statement yesterday, which states, "We believe that LeAnn Rimes' newly released I Need You album is the best album that she has ever recorded. We are excited about the new musical directions that LeAnn is exploring for the future, and as always we respect her talent and her opinions." *cough*

Ms. Rimes has been striving to sever her contract with Curb, which she signed under her father's guidance when she was 12 years old. Now 18, the contract understandably has become progressively perceived by her as "unfair." Additionally, Rimes is currently in the midst of suing her former managers for allegedly stealing over $7 million dollars from her during her career. Sadly, her ex-managers are her now-estranged father, Wilbur Rimes, and his business partner, Lyle Walker. Mr. Rimes has filed a countersuit, the gist of which is that he can't seem to manipulate his daughter anymore.

August 28 -- The Los Angeles Times has reports that the country music supergroup Dixie Chicks has sued its label, Sony Music Entertainment, for over $4 million in royalties. The group has also sued to sever the seven-album deal it signed with Sony in 1997. Their debut album, Wide Open Spaces, and its follow-up, Fly, have together sold nearly 20 million copies and have brought in over $175 million.

The trio, consisting of Natalie Maines Pasdar, Emily Robison, and Martie Seidel, allege that Sony has been involved in "systematic thievery" of the royalties due the label's artists. In a released press statment, the Dixie Chicks have asserted, "We refuse to sit back and silently endorse this behavior simply because this is a 'standard' practice at Sony. ... This is about people keeping their word."

February 8 -- Bruce Springsteen lost his case for the domain name of "brucespringsteen.com." Springsteen had hoped to evict a fan club called "The Unauthorized BruceSpringsteen.com Web Site" from the domain. A three-member panel ruled in favor of Jeff Burgar, owner of the site, stating that the Bruce Springsteen Club did not violated any of Springsteen's rights by registering the domain.

The loss probably came as a shock to Springsteen because in the past, the World Intellectual Property Organization (the United Nations agency that protects trademarks and patents) has ruled in favor of celebrities. (Julia Roberts, Nicole Kidman, Venus and Serena Williams, and Madonna to name a few.)

The panel ruled that Jeff Burgar had "demonstrated that he has some rights or legitimate interests in respect of the domain name, and [Springsteen] has failed to demonstrate that the domain name was registered and has been used in bad faith." The panel also found that Springsteen put forward no evidence that Burgar had ever tried to sell the domain name.

General Notes -- Quotes -- Artist Activity -- Other 2000 Stories

Other 2001 Stories -- Chronological

January 3 -- It may be a new year, but the on-going downsizing trend which has ripped through the digital music industry continues with Listen.com reportedly letting go of 42 employees, a 25% reduction of its current staff.

January 4 -- MusicMaker.com has announced plans to liquidate itself, citing the limited amount of investment available to the digital music industry. Like others in the digital music industry the company's stock sank over the past 7 months to around $2.88 a share, from a high of $281.25 on the day of it's initial public offering in July of 1999.

The company was one of the first digital music companies to attempt to reach licensing agreements with the major label recording companies. Its failure to do so ultimately caused the demise of the company. EMI sold their stake in the company last month.

January 4 -- SoundScan, Inc., the company that's been keeping track of sales for the record industry and several major publications, including Billboard, since 1991, announced today that Y2K was the biggest year for sales ever. The previous record was set in 1999, when 784.8 million units were sold. With 785.1 units sold over the last 12 months, 2000 ekes past to set the new mark. And over 13 million albums were sold online.

The biggest selling album of the biggest year in history was *NSync's No Strings Attached which sold a mind-blowing 9.9 million copies. The album also set a record for first-week-of-release sales, when over 2.4 million units sailed from the stores. Furthermore, a staggering 6 albums broke the million-selling milestone in their first week. Previous to 2000, a mere 2 albums had pulled that off.

The remainder of SoundScan's top-10 for sales looks like this:
2. Eminem: The Marshall Mathers LP {7.92M}
3. Britney Spears: Oops! I Did It Again {7.89M}
4. Creed: Human Clay {6.6M}
5. Santana: Supernatural {5.9M}
6. The Beatles: 1 {5.068M}
7. Nelly: Country Grammar {5.067M}
8. Backstreet Boys: Black & Blue {4.3M}
9. Dr. Dre: Dr. Dre 2001 {4M}
10. Destiny's Child: Writing's On The Wall {3.8M}

A total of 202 albums sold 500,000 or more copies last year, of which 88 sold at least a million. Of all the year's best-selling albums, The Beatles' had the biggest month-peak, moving over 5 million copies in the month of December. It is currently in its 5th week at #1 on Billboard's Top 200 Albums chart, selling a little under 500,000 more, which is pretty astonishing for a group that hasn't played a note together in over 30 years.

As far as the labels go, the leader was Universal, whose market share was a full 28 percent. Next in line was BMG with 19.4%, Sony with 15.4%, Warner with 13.5%, and EMI with 8.7%.

Touring numbers were also record-setting in 2000, as $1.7 billion in ticket sales were tallied. It seems Tina Turner led the list, pulling in $80.2 million, followed by *NSync with $76.4 million.

SoundScan's report also noted the best-selling albums of the past ten years. The list is led off by Alanis Morissette's Jagged Little Pill {13.7M}, followed by Shania Twain's Come On Over {13.6M}, Metallica's Metallica {12.4M}, Backstreet Boys' Millennium {11.6M}, and The Bodyguard soundtrack (11.6M}.

January 8 -- XM Satellite Radio has announced that is will launch its first satellite "XM-1" nicknamed "Roll" from a floating launch platform near the equator at 6PM EST today. XM Satellite Radio will then launch a second satellite, the XM-2 nicknamed "Rock" this coming spring.

January 8 -- MP3.com has filed comments with the U.S. Copyright Office supporting an RIAA request that the office conduct an inquiry regarding the application of the Copyright Act to the delivery of music over the Internet.

January 8 -- The October 2000 issue of Entertainment Weekly contained an article titled "Loser Takes All" about Napster's large user base growth during their court case with the RIAA. If Metallica, other musicians, and even the RIAA itself had never created such a fuss over the software to begin with, would Napster be as big as it is today anyway?

The article also shows a graph with Napster's registered users rising from one million in February 2000 to nearly five million in July 2000. In the latest Napster.com newsletter, Shawn Fanning (Napster's creator) said the company was approaching 50 million registered users with as many as 1.3 million using the service at the same time.

January 9 -- Apple Computer introduces iTunes.

January 11 -- Napster and Bertelsmann release a new version of Napster software, which includes an e-commerce component linking to Bertelsmann-owned CDNow. The new release marks the first step the two companies have taken toward generating money.

January 12 -- EMusic has announced that it is reducing its overhead operating costs by reducing its staff by 66 people, around 36% of its current staff. With the reduction in staff, EMusic is expecting to save an estimated $16 million dollars over the next year.

January 14 -- "Pimpshiz," also known as the person who allegedly hacked into over 200 websites last year and changed the sites to promote Napster, has had the law catch up with him. On Friday, police confirmed that they have searched the home of the 17-year-old high school student and confiscated computer equipment.

January 15 -- Culture Minister Catherine Tasca of France has said the country is considering to collect taxes on the sale of digital electronic goods that can record music as a way of compensating the artists.

"A tax on set-top boxes, advanced video recorders and computers, in other words, any device that allows such works to be recorded...should be looked into. Nothing is yet decided," Tasca stated in an interview. "The emergence of new technologies has led to a real problem in terms of authors' rights. They have create the myth of free access on both ends of the production chain," she said.

Tasca also announced that at the beginning of the month there will be a new levy placed on digital recording devices (blank CDs and DVDs, MP3 players) which will go into action on January 22. The recording levy is based a sliding scale depending on the time or memory capacity of the device.

January 16 -- Princeton University computer science professor Edward Felten, who recently participated in a group which claims to have cracked SMDI (the Secure Digital Music Initiative), is now being silenced over fear of litigation.

January 16 -- BMG announced today that they are substantially increasing the volume of digital music that they offer online, and will make new releases simultaneously available online as they hit traditional retail channels in the future. The company has announced that they are building up their retail network of digital distribution in a very impressive manner.

BMG has over 2,900 tracks available in digital download format, and looks to be the first of the first major labels adjusting with technology and harnessing its power rather than attempting to fight it and delay the inevitable.

January 17 -- AOL/Time Warner has selected Kevin Conroy, a former BMG Entertainment executive, to head up the music group of AOL. AOLTW will be keeping the supervision of the Warner Music Group separate from the management of the AOL Music Group.

AOL had previously acquired Nullsoft (Winamp, ShoutCast, ect..) and Spinner.

January 22 -- IBM has stated that they will be releasing a new version of their anti-music piracy software.

January 22 -- CyberRadio.com Inc. has announced it's new Cyber Centers Internet Services License Program, which will put 55 to 75 licensed Cyber Centers across the United States over the next two years.

Cyber Radio, which currently has around 15,500 radio stations featured in it's world wide radio network, will be offering up independently owned and operated licensed Cyber Centers for around $350,000, increasing based on region, population and market size.

January 22 -- The security group Attrition.org announced that hackers have defaced 26 government Web sites in the United States, the United Kingdom and Australia last week. A group called Pentaguard took credit for the job and left a message on the attacked sites stating that their targets were useless because they did not contain pornography or MP3 files.

January 25 -- TVT Records (home to Snoop Dogg) announced that they are dropping their lawsuit against Napster, and will work and promote the growth of Napster's upcoming subscription service. Steven Gottlieb, President of TVT Records, stated that they are dropping the lawsuit and will now support the revolutionary file sharing service under the strategic alliance it has reached with Bertelsmann.

January 27 -- The Beatles' 1 continues to outsell all other albums in the U.S. and numerous countries around the world, despite being taken from the top in Great Britain after a 9-week run. It again outpaced Shaggy's Hotshot album in the U.S., 215,000 to 203,000 according to SoundScan, Inc., and remains in the #1 spot for the 7th consecutive week (8th overall) on The Billboard 200. Interesting to note that 1 is also the first album by a British artist to possess the #1 position in the U.S. for this long since July 1989, when Fine Young Cannibals held on for 7 weeks with The Raw And The Cooked.

February 4 -- While the management of digital audio delivery online is something that Microsoft been aiming to control for sometime since the inception of Windows Media, it seems Microsoft has been building some new features into the Windows operating system which further assist in giving copyright holders security.

The "Secure Audio Path" technology scrambles the audio output from a PC's soundcard, thus eliminating the ability to record the audio at that point. This technology is already present in the "WindowsME" or Windows Millennium edition of the Windows OS.

February 8 -- Intel has unleashed a new set of API's (application programming interface) for their "Peer-to-Peer Trusted Library", allowing developers to pack in support for peer authentication, encryption, digital signatures and secure storage of files. Intel hopes to provide the P2P (peer-to-peer) development community with a method of securing applications being developed for P2P file exchange. Thus, allowing the control of content distributed through these systems.

February 8 -- With pressure coming from Sony Music, Napster was forced to ban users from its service for allegedly swapping unreleased music from the upcoming Manic Street Preachers album.

February 11 -- The 9th U.S. Circuit Court of Appeals is ready to rule on a lower court's injunction against Napster. This has created an MP3 downloading frenzy. Yesterday, almost 10,000 Napster users logged on to just one of Napster's computer servers sharing nearly two million MP3 files. (Napster's servers normally accommodate about 6,000 users at a time.) Even through what some people see as impending doom, Napster is remaining hopeful. "We have great confidence in our legal position," said the company in a statement.

February 12 -- RIAA has hired Bob Dole so that he may act as a strategic advisor with their lobbying arm.

February 12 -- The 9th Circuit Court of Appeals rules that Napster may be held liable for contributory copyright infringement. Stocks on Wall Street for digital music companies soared.

EMusic.com (EMUS) has seen its stock fall as low as $0.25 in the past year, but with today's Napster ruling the stock jumped an astounding 69.23%, to $0.68. This is good news for the company because if the stock hadn't shown signs of life, NASDAQ officials were threatening to drop it from the market.

Gene Hoffman, President and CEO of EMusic.com, issued a statement, saying: "We are pleased that the district court will be issuing a new injunction against Napster that will effectively block the unauthorized distribution of music files. This should establish a clear foundation for the growth of legitimate music download services on the Internet -- where artists, labels and consumers all have a voice in how digital music is enjoyed."

MP3.com's MPPP also had a substantial gain. The stock jumped to $4.59, up 8.09%. With a 52-week high of $33.50 MPPP still has a long way to go, but the increase is a welcome boost for investors.

Among others in MP3's space, Launch Media (LAUN) is unchanged at $1.72 and Artistdirect (ARTD) is rallying 20% to $0.75 cents.

February 20 -- Napster has offered to pay record companies $1 billion over the course of five years in exchange for allowing the trading of copywritten music on the service.

February 26 -- According to data released by the RIAA, shipments of CD singles sank by 39 percent last year. Obviously it is Napster's fault.

"Napster hurt record sales," said RIAA president Hilary Rosen, particularly pointing out the drop in the sales of singles.

On the other hand, Napster chief executive Hank Barry said the association is twisting the data to support the recording industry's claim that they have suffered "irreparable harm" at the hands of Napster users. "In order to argue we've done irreparable harm, it would be great if there were some irreparable harm to show. We haven't seen a credible survey yet that suggests Napster is hurting CD sales," said Barry.

February 27 -- The RIAA announced that former Montana Governor, Marc Racicot, will be added to its consulting team that already includes Sen. Bob Dole. The move comes less than a week away before a California judge will decide if Napster Inc.

"This debate over intellectual property has wide-ranging implications beyond just what is going on in the recording industry. This is a fundamental property right, and it has been for two centuries. Without the protection of private property for the last 200 years, we wouldn't have the progress in this country that we've had," said Racicot during a media briefing with Hilary Rosen.

March 2 -- As a last attempt, Napster decides to filter out a million copyrighted songs.

March 2 -- Napster CEO Hank Barry announced that it will unveil a system to screen out copyrighted content some time "this weekend." The recording industry sent Napster a list of filenames and artist/title information. Based on this list Napster must come up with some way of making sure that those songs do not appear when users run a search.

Contrary to what Napster previously asserted in court, they are now claiming that they do have the ability to enforce such a proposal. Napster is now confessing that there are technical means that can block clearly identifiable copyrighted materials. Judge Patel said that not all of the weight should fall on Napster. There is to be a "shared burden" between the recording labels and Napster.

"Independent artist concerns are different than those represented by the labels," said the attorney representing non-label artists. Any proposal that filters copyrighted songs based on song title could potentially block files that artists want to be released. Simply because songs have the same name, doesn't mean that they are the same song. Frackman argued that despite that, the burden must be on Napster to decide the differences.

After the two and a half hour hearing, Hilary Rosen, spokesperson for the RIAA responded to concerns around the litigation. The $1 billion settlement offer by Napster would elicit "no industry response." Such agreements would have to be made with individual labels and artists.

March 7 -- Independent label TVT Records (home to Nine Inch Nails) recently came out victorious with its legal win against MP3.com. U.S. District Judge Jed S. Rakoff granted TVT a partial summary judgment, affirming the label's musical copyrights were willfully infringed by MP3's digital music locker service, My.MP3.com. The judge added that mp3.com cannot be held liable for statutory damages on TVT copyrights that were not registered with the U.S. Copyright Office until after they were used on My.MP3.

March 8 -- EMusic files a copyright infringement suit against Napster accusing it of unfair business practices. EMusic bills itself as "the premier source for legitimate MP3s" and pays artists for each music download off its subscription-based web site. EMusic is accusing Napster of unfair competition because Napster's business is based upon illegitimate use of copyrighted material.

March 9 -- The new Dave Mathews CD tops the charts in its first week, with sales of more than 750,000 copies, making it the biggest debut for an album so far in 2001. And "I Did It" has been freely available on Napster for almost a month.

March 12 -- Napster just isn't moving fast enough for the RIAA, which is giving the company until Wednesday to block the free exchange of MP3s. Amy Weiss, spokeswoman for the RIAA, said that a list of 135,000 copyrighted songs would be sent to Napster Inc. to be "filtered out" of downloading capabilities.

March 13 -- Napster announced a partnership with Gracenote, a technology company specializing in music recognition, content delivery, and database management. Gracenote has been compiling a music database since 1995 for online information access and software applications. Napster will be allowed to leave Gracenote's licensed music on its service.

March 14 -- Napster sent out a court document stating that the filters they have put in place are working, and that they are still improving the filtering. Although many files are being blocked, common mispelled names are getting through, but there is currently a group of people working on that. While spelling 'Metalika' will give you some results, spelling changes will be slowly weeded out...

While many of the songs presented to the court didn't follow the guidelines for blocking which would make them invalid, over 45 000 have, and Hank Barry, Chief Executive of Napster, says that two thirds of the songs will be blocked by Wednesday evening...

March 21 -- Last Friday, U.S. District Court Judge Sidney Stein delivered a decision that allows MP3Board to sue the RIAA for damages resulting from a ten day shutdown caused by an RIAA copyright infringement claim. The claim, filed in June of last year, accused the search engine web site of violating copyright law because it was linking to illegitimate files.

The decision paves the way for search engines to retain their freedom to link to any material without a severe threat of legal action. The trial is currently scheduled for May 23. This is the first time that a web site has been allowed to take a case for shutdown damages to trial.

April 4 -- Despite the immense gains in Gnutella usage over the past several months, Gnutella usage is still not seen as a threat to the recording industry. RIAA anti-piracy expert Frank Creighton stated that Gnutella is not enough of a problem to warrant devoting manpower to stop it. The industry association is currently focusing its efforts against Napster and its clones.

April 9 -- Recent developments in MP3.com's ongoing troubled court cases have a judge ordering the music mega-site to pay $300,000 in damages to an independent record label for copyright infringement. Privately owned Tee Vee Toons Records claimed that MP3.com's Instant Listening service violated TVT copyrights by making TVT songs available to Net surfers for listening online.

MP3.com's Greg Wilfahrt said TVT had been asking for over $8 million in damages to begin with, and the $300,000 award showed the jury was unconvinced by TVT's argument.

April 9 -- Jurors who ordered the MP3.com site to pay $300,000 to Tee Vee Toons Records have reevaluated their math and discovered what they really meant was $3 million.

April 12 -- Microsoft Corp. and RealNetworks Inc. are working to together in order to steer music lovers away from the very popular MP3 format. Instead, the companies are encouraging users to use proprietary software formats. Microsoft and RealNetworks say that the audio sound will be significantly better but will also make it harder to share copyright-protected songs.

April 20 -- Napster announced it licensed privately held Relatable's acoustic fingerprinting technology to help filter songs in compliance with their injunction.

April 25 -- In September of 1999, the Secure Digital Music Initiative (SDMI) held a $10,000 contest challenging computer pros to hack into copyright protection technologies. Professor Edward Felten and his academic hacking group from Princeton University were the ones who answered SDMI's challenge and now they have been threatened with legal action if they go through with plans to reveal how they cracked the anti-piracy codes. The group had planned to reveal the results of their efforts later this week at the Fourth International Information-Hiding Workshop in Pittsburgh, Pennsylvania but now those plans are on hold.

Earlier this month, Felten received a letter from SDMI and the RIAA urging him to refrain from discussing his findings or face potential legal action. "Any disclosure of information gained from participating in the Public Challenge would be outside the scope of activities permitted by the Agreement and could subject you and your research team to actions under the Digital Millennium Copyright Act ..." stated the letter.

SDMI had hoped their challenge was a way to foolproof their anti-piracy efforts before adopting it as an industry wide standard.

April 25 -- According to the Pew Internet and American Life Project, 37 million Americans have downloaded free music from the Internet since last summer, a 40 increase. The study went on to find that twenty-nine percent of American adults say they have downloaded music online. That figure jumped seven percent from late July 2000, when the recording industry was at war with Napster in U.S. District Court. The surveys polled a total of 4,205 adults and 754 children.

April 27 -- Napster reports problem stems from their filtering efforts. Their most recent efforts to comply with a judge's order to remove copyrighted songs has the service blocking common words in the English language. This includes taking material that no one has asked to have removed, like indie music, concert recordings, etc.

April 28 -- Judge Marilyn Patel issued a memorandum stating that the music industry, not Napster, is responsible for tracking down specific file names used to identify copyrighted songs.

May 8 -- EMusic has announced that it's subscription service has grown to a respectable 170,000 tracks available, packing in the works of over 8,000 artists.

May 15 -- Users of the retail version of Windows XP will be required to contact Microsoft when first installing the OS, and on subsequent installations. This is designed as an anti-piracy feature, as it will limit the number of times the software can be installed on different hardware. Microsoft is refusing to tell customers what that cut off point is. Duncan Reid, product services group manager at Microsoft, defended the company's decision, and told silicon.com: "We are not being explicit on details because we don't want to make life easy for unscrupulous hackers."

May 20 -- Vivendi Universal has offered to acquire mp3.com for $5 per share of stock, roughly $372 million in cash and stock.

Vivendi Universal stated that they aim to create multiple revenue streams to enhance Vivendi Universal's current online strategy, but will allow MP3.com to remain a "Independent Distributor of Music Content for All Record Labels and Independent Artists".

June 1 -- Live365 has announced the availability of a new service, On-Demand Audio, enabling on-line broadcasters the ability to upload various audio files, and then have them available for playback on demand.

Live365 is offering this service to broadcasters on a subscription basis, with a sticker price estimated at $150.00 per month. While certainly not free, these streaming services do provide organizations and broadcasters an option which previously did not exist in a easy to deploy system such as Live365's system enables.

June 26 -- The federal appeals court has set out that Napster must continue to block the swapping of copyrighted music.

June 29 -- Yahoo! will expand its online music library with its agreement to acquire Launch Media, Inc. for $12 million dollars.

July 3 -- Napster suspends all file sharing

Aug. 6 -- A discussion of the Music Online Competition Act, sponsored by Rep. Rick Boucher (VA) and Rep. Chris Cannon (UT). Hilary Rosen came out to complain about this bill before it was even complete.

September 10 -- With the help of Fritz Hollings (D-S.C.), the powerful chairman of the Senate Commerce committee, the RIAA hopes to embed copy-protection controls in nearly all consumer electronic devices and PCs. All types of digital content, including music, video and e-books, are covered. This means radios, televisions, cell phones, basically anything with a microchip inside. Hard drives, CD-ROMs, floppies, you name it. We're not just talking CD recorders, but anything that receives or uses an electronic signal. TIVO, Satellite TV, Cable.

September 25 -- Internal email from RIAA Chairman and CEO Hilary Rosen to industry executives:

Subject: Peer to Peer Services
Sent: 9/25/01 5:53 PM
Importance: Normal

Dear all:

It is time to get coordinated and aggressive with the new round of peer to peer services. The amount of music being downloaded is, as you know, reaching unprecedented levels. Since college started last week Morpheus traffic was up to 19 million downloads per day. AND THAT'S JUST MORPHEUS. With the imminent launch of legitimate subscription services we have to get our customers back.

I know you want your new businesses to be successful. So do I. Given the overwhelming volume of these alternative services, RIAA can't handle all of the enforcement alone. If they are not controlled more effectively and consumers redirected to legitimate offerings, there won't be new businesses. That's obvious.

You are all competitors, but you have common interests in enforcement. Help me help you. I'd like to have a meeting at the RIAA in October as soon as possible. If you agree to participate, I will have my assistant try and work with schedules to get a date that works.

I want to keep the meeting small to start (we can expand participation to other companies later).

We need to discuss:

1. Spoofing and/or interdiction methods for existing peer to peers - (perhaps by adding promotional messages about the launch of various new systems)

2. A PR campaign

3. We will share the latest legal strategies and RIAA's thinking on options

Please plan on attending. I am cautious about sending alternates because we need people who have the ability to make decisions and commit to spending.

Best regards,

Hilary

November 7 -- Rosen explained that her industry's focus has traditionally relied on promoting music to the buyers for record store chains, not listeners. The Web, she said, has changed all that, and is causing a shift in its approach to one that is more consumer-oriented.

"Building a legitimate business model from scratch -- one that involves literally hundreds of millions of copyrights and interlocking creative rights, navigating incompatible DRM's and players and building customer service and ease of use that music fans have always enjoyed -- isn't quite as easy as people might think," she said. "It is clear that record companies haven't been as quick as some have hoped to get online. Maybe that encouraged piracy -- not excused it, to be sure, - - but encouraged it by not filling the vacuum of consumer demand."

Rosen explained that the interests of recording artists are threatened by P2P technology. "This is an industry of advances, not royalties," she said. "A record company executive once said to me: 'If an artist of mine gets a royalty, I haven't done my job at negotiation time."

Reflecting on the music industry's hodgepodge of mostly stillborn attempts at making their assets available over the Internet, Rosen admitted that the industry had made some critical errors along the way.

"If we had it to do over, I think the recording industry would do it differently. Technology development and innovation might not have been left to the consumer electronics and IT industries as it was by the recording industry in the 80's, leaving our companies less than fully operational on that level when the wave of new opportunities hit again in the early 90's. But it is clear -- our member companies see an enormous opportunity here and now and are working diligently with technology partners to seize it."

Rosen said she feels there is "too much music available for the current distribution model" and looks forward to the potential for new "legitimate business models" in the future.

"Obviously, in a free market, our approach isn't the only one, nor, for that matter is peer-to-peer. What we seek -- and what I hope you'll embrace -- is an open market in which everyone competes with mutual respect on the value of his or her creations." But she also assured the audience that the RIAA has no intention of halting its current legislative efforts. "We have no choice but to continue them as long as copyrights are being infringed," she explained. "But we also know legal efforts won't get music online. Legitimate business models will. Consumer demand will. Technology will. I want to get the lawyers out and the innovators in."

Rosen finished her speech with traditional promises of new services and technologies on the horizon: "New subscription services are being launched in the coming days and months. Virtually all RIAA member companies are participating in launches of these multiple services. I think the initial offerings will be very good. But they will get better as technology develops and the desired consumer experience has better definition. A lot of progress is being made and more will be done."

O'Reilly and Associates President Tim O'Reilly asked Hilary to explain the math a bit behind the Recording Industry's cost model. Rosen commented that such figures were hard to nail down, due to the many possible variations of recording and marketing agreements. "There's no single model. There's no single way," she said. (Note: the RIAA's Cost of a CD document and Market Data newsletter offer a bit more specifics on the numbers involved.)

November 28 -- Bill Evans warns that "[The RIAA] want to search your computer, without a warrant. But while there they will be able to access any other information, private, personal, work, banking, where you've been visiting on the internet, anything! Without cause, without reason. These are rights we don't even extend to the Federal Government without a search warrant."

The RIAA denied they wanted to hack your computer.

December 10 -- Many major label artists are preparing cease and desist orders for their labels to prevent the use of their music on the label's effort, MusicNet and PressPlay, without their permission.

December 20 -- Several major label artists are reportedly organizing their efforts collectively to raise money for The Recording Artists Coalition's legislative fight against the recording industry.

General Notes -- Quotes -- Artist Activity -- Other 2000 Stories

Sources

  • Whenever possible, all articles on this page are linked to the source. The chronology of the articles was culled from extensive research in the Boycott-RIAA News Archives.