The Homa Files

Excerpted from the New York Times, “Music Industry Imitates Digital Pirates to Turn a Profit”, by Eric Pfanner, January 18, 2009

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After years of futile efforts to stop digital pirates from copying its music, the music business has started to copy the pirates.

Online and mobile services offering listeners unlimited “free” access to millions of songs are set to proliferate in the coming months, according to music industry executives.

Unlike illegal file-sharing services, which the music industry says are responsible for billions of dollars in lost sales, these new offerings are perfectly legal. The services are not really free, but payment is included in the cost of, say, a new cellphone or a broadband Internet access contract, so the cost to the consumer is disguised. And, unlike pirate sites, these services provide revenue to the music companies.

Perhaps the most prominent service offering unlimited downloads has been Comes With Music, which was introduced in Britain last fall by Nokia, the world’s largest maker of cellphones. It lets users download as many songs as they want, from a catalog of more than five million tracks, when they buy certain Nokia phones.

Other services offering unlimited downloads are being introduced by Internet service providers, which many people in the music industry say hold the key to curbing piracy because of their direct relationship with Web users.

“At the end of the day, we are not going to stop piracy, so let’s embrace it,” said one industry insider.

Music companies have balked at such arrangements in the past. But they are showing a newfound flexibility in licensing their material as their existence becomes increasingly threatened.

Cellphone manufacturers, meanwhile, are eager to add music services as the battle of the smartphones heats up among companies like Nokia, Apple and BlackBerry.

Edit by DAF

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Full article:
http://www.nytimes.com/2009/01/19/business/worldbusiness/19digital.html?ref=technology&pagewanted=print

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