The New War on MP3s: EMI’s Push to Ban Remote Music Storage

In the latest C:Spin over at CEI’s website, I examine the record industry’s latest Internet copyright battle and the shortcomings it reveals about U.S. intellectual property laws:

The next potential casualty of America’s deficient copyright regime is MP3Tunes, a San Diego startup founded by Web entrepreneur Michael Robertson, which lets users store digital music files in a secure, Web-based locker they can access from anywhere. MP3Tunes lets listeners access only music they have uploaded themselves. Like a handheld MP3 player, MP3Tunes frees music lovers from dragging around massive album collections on physical discs.

But now Robertson’s service has run into a major obstacle. EMI, a major British record label, has sued MP3Tunes for copyright infringement. EMI contends that since users are transferring their music to a third party without getting permission from the record label, MP3Tunes is violating EMI’s exclusive right to distribute its music. MP3Tunes faces tough odds given past rulings in copyright infringement cases.

EMI’s argument seems tenuous. MP3Tunes doesn’t “share” files with anybody but the original owner, and paying a third party to act as a custodian does not imply a transfer of ownership. Individuals can already store digital files online using myriad services from Flickr to Mozy. We increasingly back up our entire lives to online repositories, and the individual, not the website, remains the owner.

I also discuss ways that media companies could embrace emerging technologies in ways that are mutually beneficial to consumers and producers:

Content owners have rights, but
those should not extend to shutting down music storage websites that are not
abetting copyright infringement. And nothing is stopping EMI from developing
its own digital locker service. That a Web startup dreamt up an innovative
business model to complement consumers’ busy lifestyles is no cause for judicial
intervention.

MP3Tunes is neither facilitating
piracy nor discouraging people from buying music in any way. In fact, by making
music collections more accessible and therefore more valuable, MP3Tunes might
actually cause people to buy more music.

This is an old story, familiar
since Napster burst upon the scene: Instead of
fighting sites like MP3Tunes, major labels would be wise to embrace new ways of
delivering value to consumers. Rather than fight Silicon
Valley startups, the big music labels could partner with them.

The digital era presents a golden
opportunity for consumers and producers alike, if only companies and courts can
keep pace with the breakneck pace of technology. Listeners’ appetite for
compact discs may have waned, but not so with digital media files. ITunes recently announced that is has sold over 4 billion songs. In addition, the runaway success of satellite radio and online music subscription services point to a bright
future for new music distribution media .

Later, this C:Spin discusses the potential pitfalls of sweeping Congressional regulation in the digital age where technology evolves at an unforeseeable pace.

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