Silicon Alley Article by Andy Pelander Day one of Silicon Alley 2000 closed with a panel--"The Digital Music Revolution: Overhyped but Underway"--that offered a glimpse into the issues surrounding free MP3 downloads and music piracy on the Internet. Modern music legends Jimmy Page of Led Zeppelin and the Black Crowes' Chris and Rich Robinson shared the stage with dot-com execs throwing cost-free music--their music--at download-happy consumers. Among the Internet executives participating were Nicholas Butterworth, MTVi CEO; Larry Lieberman, president of global marketing for Musicmaker.com; and Eileen Richardson, CEO of controversial MP3-search application developer Napster. The disdain shared by Page and the brothers Robinson for both Lieberman and Richardson, whose companies are widely spreading artists' music without artists' permission, was as clear as digital recordings. The discussion began when moderator Jason McCabe Calacanis asked whether Napster, perhaps the year's most innovative software program, presents a problem for artists. "How do artists feel about Napster?" he asked. "Well, obviously, we're not going to pop a bottle of Champagne, are we?" Page replied. Gesturing toward Richardson and Lieberman, he added, "But they are." Chris and Rich Robinson voiced their agreement. The crux of the issue is royalties, and the fact that artists aren't generally receiving them for music available online. When asked whether her product enables people to do something illegal, Richardson dodged the question: "Our software allows people to share MP3s," she replied. -------------------------------------------------------------------------------- "Well, obviously, we're not going to pop a bottle of Champagne, are we?" ---Jimmy Page, on artists' reactions to programs such as Napster -------------------------------------------------------------------------------- "I don't think any artist wants to work and not get anything for it," Chris Robinson said. Richardson, whose company is currently "in lawsuits with a number of record labels," insists that she is doing artists a service by broadening their fan base. "On the one hand, we're being sued," she said. "But on the other hand, we've got artists coming directly to us... We think we've developed a way for artists to make more money than they ever have and we want to be a forum for that." "How are artists going to make money if they're not being paid for their music?" Rich Robinson asked. "Very few artists make a lot of money off record sales," Richard said. "Merchandise is where the money is made. If you can broaden your fan base by using the Internet, you'll have more people buying T-shirts, thus, bolstering your profits." According to Lieberman, the businesses that offer downloadable music on the Internet are only as good as the repertoire they include--and include legally. "It's all about the repertoire," he said. So the issue becomes, why would an artist or band contact Musicmaker.com, for instance, when they could develop a channel for their own distribution? "It's like the '60s, when you could produce a single and distribute it yourself. That part of it is very exciting," Chris Robinson said. "Every band is going to have a website now, because frankly, it's easier to produce a website that offers music and information than it is to distribute albums or promote offline," said Butterworth, who is legally bound to pay royalties to both artist and record label for music played over MTVi's Net radio program. -------------------------------------------------------------------------------- "Our songs are our lives. That's the way we've chosen to be creative and they're not something to be tampered with." ---Chris Robinson -------------------------------------------------------------------------------- Despite this assumption, Jupiter Communications predicts that pure digital music distribution will account for a measly 3 percent of sales by 2003. If that's true, the record industry's current immobilizing paranoia of digital music distribution via the Web may prove less short-sited than sites like CDNow and SonicNet hope. "The whole of this thing for me," Page explained, "is that consumers have more choice in it. It's a new season--we used to collect 45s, now it's something new. [Collecting music] is very personal. That part for me is important." Sites like Musicmaker.com claim to have created the ultimate personalization process: build your own CD. But artists feel they deserve some control over where their music winds up, especially if it's one in an assortment of "dance tunes" that was digitally burned by an 8-year-old. "Our songs are our lives. That's the way we've chosen to be creative and they're not something to be tampered with," said Chris Robinson, drawing applause. Correction (3/2/00): Musicmaker.com should not be grouped together with Napster as companies that are "widely spreading artists' music without artists' permission." That classification is inaccurate; Musicmaker.com pays royalties on all music available on its site. The Daily regrets the error. 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