2. I think you've been misled about what the Berman bill would do. It would allow copyright owners to use technical measures to prevent illegal distribution of copyrighted works on P2P systems. It would not allow, and we would never seek the right, to go into people's computers and "scan" their files. No viruses; no deleting MP3 files; no hacking; just technical measures to prevent distribution of a file after it leaves someone's computer. Thus, we would have no reason to ever try to discern whether or not someone honestly owns a piece of music on their computer.

3. NO! I understand that people read more about litigations than about the day-to-day efforts of record companies to launch (and license) legitimate online businesses, but the fact is that the record companies have been working very hard at getting music on the Internet legally. That happens to be difficult - because you need the permission of the songwriters and music publishers, and in many cases the artists as well, and those clearances aren't easy to get. (Everyone is nervous about piracy, and trying to figure out how much revenue they should earn, and what the business model is going to be, etc.) And then there are the technical infrastructures that have to be built to account for downloads and streams and pay royalties to rightsowners; the security for the content; and so on. It's a lot easier to do it illegally (just post it, don't worry about security, and don't pay anybody anything); doing it legally takes time. But the companies are getting there. There are a lot of subscription services that are up and running with lots of content; more companies are allowing more downloading, and burning; there's a lot of experimentation on pricing. In other words, a real market is emerging!

Question #3:
Why does the entertainment industry in general, and the recording industry in particular, look at technology- MP3 and internet radio being the two examples that come most readily to mind- as a threat to its profits that must be agressively neutralized? Instead of exerting energy against technology in an effort to maintain the status quo, why not work with technology, put your own creative resources behind it, and help figure out a way to make change a positive thing for everyone?

Andrew Duncalfe

Cary Sherman:
Please see my response to the last question - I think I answered essentially the same question. What's important to understand is that the record companies are not trying to "neutralize" MP3s or Internet radio? they're simply trying to ensure that they operate in a manner that's consistent with a legitimate marketplace. If P2P systems are displacing sales, then who is going to invest in an online delivery system that actually pays royalties to artists, songwriters, producers, publishers and labels? The companies are anxious to work with technology and put their own creative resources behind it to make a positive change for everyone - that's why they've been working on deals for new delivery systems like subscription services, download services, locker services, etc. But if third parties like KaZaA can come into the same marketplace and offer the same music without permission, without licenses, without paying anybody anything (other than themselves), the Internet will become nothing more than a haven for piracy, with no legitimate alternatives. That's what the litigations are all about - establishing that the same copyright law that applies in the physical world applies on the Internet too. Once those ground rules are established, businesses can flourish - and everyone benefits.