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The Music Industry DB the Nice Way or the Facist Way.

by Tom Koltai at 01:35PM (EST) on October 22, 2009 | Permanent Link | Cosmos

In 2008, the RIAA sent out 30,000 default notices to suspected file sharing copyright infringers.

The infringement notices were couched in threatening legalese designed to intimidate the recipients into settling for an average nominal figure of $3,000.

Apparently 25% of those served with these infringement notices paid up, not wishing to take the chances on a court case.

It’s a successful business model for the RIAA and they’re reasonably happy with it.

Let’s just see how that looks on a spreadsheet.

Total Infringement notices Sent	30000
25% estimated paid up.	7500
Estimate total collected	$ 22,500,000
estimated Bay/TSP, DTECNet, Admin & legal costs per infringement	$395.00
Estimated total costs	$ 11,850,000.00
Balance of funds for distribution to artists	$ 10,650,000
estimated file sharers in the USA @ 57% of Online Population	188100000
$ Recovered per file sharer.	$ 0.06

N.B: Online population actually equals all population and not just online.

OK great, so the recovery value equals six cents for every American that downloads.

Today, I was browsing P2PNet and found a story about how Canada is on the Obama’s watch list of unfriendly Copyright countries.

The story referred to Barrie McKenna’s article in the Globe & Mail. I thought I would have a look as Jon Newton’s article slammed the article as being full of inaccuracies and cast serious doubt on the legitimacy of the author as a Journalist.

The (legal) music fades out for Canadians

http://www.theglobeandmail.com/report-on-business/commentary/the-legal-music-fades-out-for-canadians/article1330240/

Well I read the article and became so incensed at the virtual parrot nature (Polly works for the CRIAA) of the author that I decided to write a response.

There are only two choices here boys and girls, either Barrie McKenna follows his bosses instruction and writes what he is told to write or he is seriously mis-informed and believes only what the RIAA tell him.

Possibly because no-one has told him any different.

So get a coffee, put your feet up and let’s debunk Barrie’s total lack of understanding of 1 + 1.

First of all we should examine some data to see if the biggest Torrent tracker in the world agrees with Barrie’s article.

Search sequence on a well known non torrent tracker search engine:

Lets try just .torrents.

Results 1 - 10 of about 239,000,000 for ".torrent". (0.12 seconds)

Lets pick the number one TV show in the world at the moment.

Results 1 - 10 of about 90,400,000 for "house" +".torrent". (0.10 seconds)

Let’s pick a movie which everyone knows.

Results 1 - 10 of about 1,720,000 for "wolverine" +".torrent". (0.21 seconds)

Lets have a look at this weeks number one selling song: Celebration by Madonna

Results 1 - 10 of about 664,000 for "Celebration" +".torrent". (0.30 seconds)

And lets check out number 2.
Results 1 - 10 of about 163,000 for "Crazy love" +".torrent". (0.25 seconds)

So it would seem that TV programs are what people are downloading the most, not music.

But on the topic of music. At Perceptric for some time, we have been saying that P2P encourages people to buy the content. So let’s see if that works for the Canadians.

From the Global Chart Report at http://www.mediatraffic.de/

'Celebration' keeps just ahead of the competition
Friday, October 16, 2009
by Fred Chuchel, Dresden

Despite a 47% sales decrease to 172.000 copies, Madonna's best of compilation 'Celebration' holds the top spot of the global album chart for a second week. In 3 weeks on the tally the album moved nearly 700.000 units. Michael Bubl's new set 'Crazy Love' follows close behind at no.2 with 169.000 copies. After only 3 days at retail in North America the album sold 132.000 in the USA and 37.000 in Canada.

	Sales	Country	Population	Percentage of Pop
	132000	USA	330,000,000	0.040%
	37000	Canada	31,000,000	0.119%

Difference	Canada wins by			298.39%

So 298.3% more sales per capita of population than the USA which we would guess isn’t on President Obama’s Black List.

Also please note the almost direct correlation between numbers downloaded and sales.

Madonna Celebration Downloads: 664,000 Sales: 700,000

Michael Buble : Downloads 163,000 Sales: 169,000

So I think we can discount music suffering in Canada more than the USA.

Not convinced yet ?

His comments are in Blue, mine in Black.

In Barrie M’kenna’s article, he stated

Published on Tuesday, Oct. 20, 2009 12:00AM EDT Last updated on Wednesday, Oct. 21, 2009 3:21AM EDT

Internet entrepreneur Gary Fung fancies himself a budding Sergey Brin or Larry Page, the Google co-founders.

In Mr. Fung's view of the world, his Vancouver-based company, isoHunt Inc., is essentially a search engine.

We agree with Gary. The worlds number one rated internet site (which is also a search engine) search engine supplied all of the statistics in the torrent stats graph above.

The catch is that 95 per cent of what goes on at isoHunt.com involves what most Western countries regard as piracy - unauthorized file sharing. Want the latest maps for your GPS, a copy of the movie Twilight, video games or just about any song ever digitized? At any time, you'll find links to more than 90 million files, neatly catalogued and free for the taking.

Again, another person that doesn’t understand the differences between:

Piracy on the high seas.

Commercial piracy of DVD’s and Music for commercial profit, and;

File Sharing for personal consumption, because;

The content is not available in the country, legally.

The individual doesn’t have a credit card,

Restriction of services like Hulu, Amazon, Pandora.com and Lala.com.

Not surprisingly, the site is wildly popular. IsoHunt is one of the world's most visited so-called BitTorrent websites, which use special software to index files and enable users to browse and download whatever digital content they want. As many as 100 million unique visitors go to the site every year, putting it among the 200 most popular websites of any kind on the planet.

Canada has earned a dubious distinction as a world hub for illegitimate file-sharing websites and a leader in Internet piracy. Canada now hosts five of the most popular pirate sites in the world.

And other unauthorized sharing sites say they have shifted operations to Canada, specifically to exploit the friendlier legal environment.

BITTORRENT NATION

Worlwide rank / Website / Visits per month / host location

3. / Isohunt / 5.1-million / Vancouver, B.C.

4. / Torrentz / 2.5-million / Laval, Que.

6. / BT Junkie / 2.4-million / Sweden and Canada

9. / BTMon / 608,000 / Brampton, Ont.

10. / TorrentPortal / 474,000 / Vancouver, B.C.

Source: siteanalytics.com

I thought we would check on the reference offered by Mr. McKenna. What we found was slightly disturbing.

http://siteanalytics.com/index.html appears to be site for the analysis of land values for shopping centre developers.

From their about page.

“Helping retailer, developer, and municipal clients achieve their expansion goals.

Since 1995 Site Analytics Co. has been helping clients boost their odds of success on every real estate transaction they make. We provide innovative techniques to shed light on the strategic questions they face on a daily basis.”

So we thought we would check similar sounding sites and we found:

http://siteanalytics.compete.com/

So we entered the five sites that Mr. McKenna relies on as the justification for Canada being one of the world leaders for illegal downloads.

http://siteanalytics.compete.com/isohunt.com.au+torrentz.com+BTMon.com+BTjunkie.com+torrentportal.com/

And we discovered that that Canada’s leading “file sharing sites can only scrounge up a measly 2,862,691 unique users and further that the trend appeared to be decreasing or remain flat since January 2009. In other words, file sharing through these sites is on the decrease.

Rightly or wrongly, Canada is seen as a country where the laws to combat digital piracy are weak, ineffective or simply non-existent, argues Barry Sookman, a partner at McCarthy Tétrault LLP and a leading Canadian expert on copyright.

Expert? What is a copyright expert? Someone that actually understands the legislation?

In other words a lawyer that is touting for more legal work on the totally non understandable copyright legislation that you would have the Canadian Government change.

"Canada is viewed as a pirate haven," says Mr. Sookman, who has done work for the Canadian recording industry.

Really? I actually thought that Canada was forward thinking country that recognised the value of locally encouraged talent and realised that file sharing couldn’t be stopped but that artists still needed to be paid. To this end, Canadians have instituted the CPCC.

From the CPCC about page:

The Canadian Private Copying Collective is the non-profit agency charged with collecting and distributing private copying royalties. Established in 1999, CPCC is an umbrella organization that represents songwriters, recording artists, music publishers and record companies. These are the groups on whose behalf the royalties are collected. CPCC is not an arm of government. Enforcement of the private copying tariff and advocacy, including representing copyright holders before the Copyright Board, which decides the tariff, are other important functions of CPCC. This site provides in-depth background on each of CPCC's key functions.

So how are they doing?

CPCC Media Royalties Collected	23434900
Divided by ten years	2343490
Administration Costs already deducted.
Balance of funds for distribution to artists	2343490
estimated file sharers in Canada @ 57% of the online Population	17670000
$ Recovered per file sharer.	$ 1.33

Source: http://cpcc.ca/english/finHighlights.htm

N.B: Online population actually equals all population and not just online.

So how does that compare with the RIAA efforts at Legal criminalization and legal actions to collect damages?

Well the figure above for the RIAA recovery method (Top table) was six cents per file sharer.

The figure in Canada is $1.33 per file sharer. That’s an increase of 2342%.

And the CPCC royalties are ACTUALLY DISTRIBUTED to artists and publishers. We have yet to see a single cent from the RIAA legal actions be distributed to artists. Until the RIAA publish a full audited (they always present their numbers unaudited) set of financials showing their distribution to artists, we can honestly say that their legal actions are for self funding purposes and not to benefit the talent that created the infringed works.

Wow! So the nice way works better than the nasty way?

It would seem so.

Let’s pop back to Barrie McKenna’s enthralling fairy tale.

Earlier this year, the Obama administration put Canada on its blacklist of shame - a "priority watch list" of intellectual property laggards, joining the likes of China, Russia and Venezuela.

No doubt, you are referring to the IPRI report, which we debunked here; http://www.perceptric.com/blog/_archives/2009/3/20/4127511.html

By demonstrating that increased levels of file sharing actually showed that in countries with a lower IPRI rating the real GDP growth of country's was superior to those countries with a higher IPRI rating.

http://www.perceptric.com/rgdp1.gif

Indicating obviously that countries that file shared more were happier and worked harder.

It would be easy to dismiss the U.S. action - an early precursor to retaliation - as yet another bit of American hypocrisy on the trade front. After all, more than a quarter of the visitors to many of these sites are Americans.

Do you have any statistics for this Mr. M’kenna? Or is this more hyperbole?

isohunt.com Rank By Country
Country	%User	Rank
UNITED STATES	26.90%	152
INDIA	9.60%	147
UNITED KINGDOM	6.10%	108
JAPAN	5.70%	319
CANADA	3.90%	97
AUSTRALIA	2.90%	83
PAKISTAN	2.30%	86
GERMANY	2.30%	677
CHINA	2.10%	1264
ITALY	1.90%	366

Access stats for ISIHunt.com.

And less than 4% are Canadians. That would suggest that Americans are much bigger file sharers than Canadians.

What Canadians should be aware of is the implied threat. An early precursor to retaliation. What retaliation would that be Mr. McKenna? Nuclear, or financial? Could the US Federal Reserve afford to short sell the Canadian Dollar into oblivion?

But that would be wrong. Canada, which has repeatedly promised but so far failed to deliver on copyright reform, isn't just out of step with the United States, but with much of the Western world.

I don’t know Mr. McKenna, I would say that Canada is providing a model of file sharing acceptance that is paying the artists far more than they are receiving through any USA initiative. If that is out of step – then viva the Canadian model.

"There are real copyright problems," Mr. Sookman concedes. "It doesn't just affect Canadians. It's a trade problem."

How is it a trade problem Mr. Sookman? Is that what you were told to say so that the Canadian Government would be shamed into accepting and adopting the US Governments anti human rights, and anti civic rights ACTA Trade agreement at the November Korean meeting?

Music and movie royalties are not a trade problem. They are a commercial licensing problem that your content company masters who no doubt instructed you on what to say in this article, have elected to not fix because after all, file sharing is profitable for them. So why would they actually want it stopped?

IsoHunt, meanwhile, is facing legal challenges. It has been sued in California by Columbia Pictures. And at home, it has sparred in court with the Canadian Recording Industry Association, which has demanded (so far unsuccessfully) that the company take down links to copyrighted material. Authorities and copyright owners say they need a lot more tools to disrupt piracy in Canada, including the ability to force sites such as isoHunt to remove links to copyrighted material without lengthy legal proceedings. They also want stiff penalties for Internet service providers who turn a blind eye to unauthorized sharing over their networks.

As I said above, file sharing is a profitable legal exercise for everyone. Let’s stop it using fines.

Bullshit. Did fines stop speeding? Nope. But they generated an awful lot of revenue. Do people still speed? Yes, but they buy GPS systems and in some countries, radar detectors that warn them of where the Speed cameras are located.

The Download Decade

Discover Globetechnology.com's special series on copyright and filesharing in the 10 years since Napster View

Ottawa acknowledges it must update its laws to meet the digital challenge. Canada has promised reform in several Throne Speeches. Those efforts have so far produced a lot of talk and thousands of pages of reports, but no law. Ottawa's last attempt at copyright reform died, along with the government, at the end of 2007.

Now, the Harper government is at it again. It recently completed a national consultation, garnering responses from nearly 5,000 individuals and groups. Industry Minister Tony Clement wants a bill by December.

Experts are dubious because so many earlier efforts failed.

"Canada has made itself a victim of this," said Eric Schwartz, speaking at a recent forum in Washington, organized by the Woodrow Wilson International Center's Canada Institute. "It has allowed the business to get established and opposition to grow."

There are good reasons for Canada to embrace reform - and not only because the Americans and Europeans are pushing Ottawa to do it.

The world has gone digital. And there's now an explosion of legitimate download sites in the U.S. and Europe, including ground-breaking music sites Pandora.com and Lala.com. But you can't use them in Canada.

These and other businesses are choosing to bypass the market entirely, in part because of licensing problems.

That’s an interesting comment Mr. McKenna. So is Australia equally bad at file sharing reform? Because in Australia we cant access any of these legal sites either. The facts are clear from the CRIAA’s own sales numbers, the fastest growth in digital distribution is from legal streaming sites.

Dec-08

2008

2007

Percent Change

2008

2007

Percent Change

Digital product ** (December 2008)

Internet Downloads

5037

2297

119%

45438

27564

65%

Digital Mobile Content

1921

1716

12%

21632

20592

Subscription Model

395

262

51%

4599

3144

46%

Other ***

319

538%

2829

552

413%

Total

$7,672

$4,325

720%

$74,498

$51,852

529%

Units and dollars expressed in thousands

Sales information is supplied by members of CRIA and tabulated by Grant Thornton without audit.

The categories of DCC/Mini Disc and Cassette Single have been eliminated from the report due to negligible sales.

* This category includes formats such as cassettes, CD singles, VHS music videos and DVD-Audio

** Monthly digital statistics are not available for 2007.

For the purposes of monthly comparisons, one twelfth of total year-to-date digital statistics for 2007 will be entered each month.

*** This category includes formats such as streams

Source: http://www.cria.ca/stats.php

Ergo, but locking out countries outside of the USA, these “legal sites” are in fact encouraging file sharing.

I would suggest strongly that until the content companies alter their policies on open access to the content via legal sites, illegal file sharing will continue to grow.

And the creative industries that produce music, software and the like - industries that contribute significantly more to the economy than BitTorrent sites –

We would dispute that Mr. McKenna. We did some arbitrary figures earlier this year and calculated that the file-sharing industry in Australia alone is worth :

Australia Population:	22,000,000
		Per Unit	% pr/yr	Number of	Total $
Infrastructure	A	98,000,000,000	0.21%	98,000,000,000	20,580,000,000
Maintenance	B	209,860,000	1	209,860,000	209,860,000
Wages/Paye	C	5,000,000,000	1	5,000,000,000	5,000,000,000
Computer	D	1,000.00	33%	11000000	3,630,000,000
Laptop	E	1,500.00	66%	4400000	4,356,000,000
Router	F	69.00	33%	3300000	75,141,000
Wifi	G	180.00	33%	3300000	196,020,000
Sat Dish	H	420.00	33%	110000	15,246,000
Modem	I	90.00	20%	11880000	213,840,000
Cellphone	J	550.00	66%	22,000,000	7,986,000,000
Retail Use Plan Home	K	39.95	100%	5,500,000	2,636,700,000
Retail Phone Data Use	L	18.00	24%	9680000	501,811,200
Wholesale Billing	M	12.00	100%	5,500,000	792,000,000
					45,400,618,200
GST	(GST not calculated on "A" and "B")				2,061,261,820
Total Value of P2P	(At 80% of Network and CPE value)				$37,969,504,016

Source: http://www.perceptric.com/blog/_archives/2009/5/29/4203779.html

In other words, in Australia P2P is worth more than the entire combined revenue base of the member companies of the various industry bodies trying to stop P2P. (i.e.: EMI, Warner, MGM, Sony)
Now multiple those figures by the population of the rest of the world and you have an industry globally that adds up to $10,355.319,277,091. In other words, Mr. McKenna, a lot more than the content industry.

may also shun Canada if nothing is done.

I don’t think so Mr. McKenna, the only danger to Canadians is the US Dollar and the lengths that the US Government will go to protect that dollar.

I don’t see why Canadians should have to support the bankrupt US lifestyle any more that they are already doing.

That hurts Canadians, and most people don't even know it's happening.

You are right Mr. McKenna, an increased support by Canada of the US Dollar may very well suit your masters but it would hurt Canadians and they don’t even know that is what this entire file sharing argument is about.

Oh, that’s not what you meant?

So sorry. With all the misdirection, outright lies and false innuendo in your article it was difficult to know exactly what you were saying that had any merit.

The article as written Mr. McKenna, is either a rather poorly compiled piece of propaganda or merely shoddy journalism.

The last man that relied on misdirection to influence the people was tried as a war criminal at Nuremberg.

He often said: “Repeat something often enough and the people will believe”

His name was Joseph Goebbels.

Your article unfortunately can be called nothing else except Blackmail. Blackmail of the Canadian people by one of their own. If you're a Canadian Mr. McKenna, may your face burn with shame for propogating this crap.