IT'S A FAMILIAR PROBLEM FOR THE music industry: Fans are using its product in unexpected ways, and they're doing it for free. The industry's response, however, shows signs of evolving. Instead of suing its customers, it may actually try to help give them what they want -- and make a buck besides.
At issue are sites such as YouTube.com that enable users to upload and watch thousands of videos, many of which use copyrighted songs. But labels and songwriters aren't collecting the royalties they're due. The situation recalls the early days of Napster's pioneering song-swapping network, which enabled users to download songs for free from one another's computers. Rather than siccing a phalanx of lawyers onto YouTube and its users, as they did with Napster, some labels and songwriters are looking for a way to turn online video into a profit center.
That's a welcome change. With music fans gradually tiring of the labels' main product -- CDs -- the industry can't sustain itself just by fighting any and every potential threat to disc sales. It has to find new revenue, preferably driven more by listeners' enthusiasm than by costly marketing campaigns.
Users of sites like YouTube typically post three types of videos: ones made by artists to promote their CDs, grainy bootlegs shot in concert halls and homemade tributes. So far, the labels have shown the most concern about the first type, which compete with the videos they sell. Instead of just demanding that their videos be taken offline, however, labels and songwriters are talking to YouTube and other sites about creating an advertiser-supported business model.