The mood among campus file-swappers

The Recording Industry Association of America recently stepped up its effort to combat music sharing by suing four university students who used their college networks to run file-sharing services.

But at Stanford University--as well as at other colleges and universities around the country--students are growing increasingly perturbed by what they see as an attempt by the record labels to infringe on their legitimate right to make copies of digital media.

This is not a group to alienate.

The RIAA's own statistics show that almost one-third of music purchases are by individuals younger than 24. This group is also likely to influence the purchasing habits of family members. From my experiences, I'd say roughly 80 percent of undergraduates on campus have downloaded a piece of audio or video from a peer-to-peer service during their college career.

You can divide the collegiate downloading universe into three broad categories.

Some students first find out about new artists or genres through friends. They download MP3s onto their computers to decide whether or not invest in a particular band. If they like the music, they purchase it at a local store or through an online retailer.

Other students download music that they would otherwise never purchase. They may like a particular song that they heard on the radio, but are not willing to pay $20 to acquire a CD that includes a dozen others that they have no interest in hearing.

The third group is comprised of students who download music that they would have bought if it hadn't been available for free on the Internet.

Given the magnitude of P2P downloads relative to historic music sales trends and my own personal experience on campus, I would think that the music industry would want to make a special effort to appeal to the second group. That's because, if these individuals bought each song they downloaded, profits in the music industry would be substantially larger.

The record labels view the situation differently. They caricature us (P2P downloaders) as an undifferentiated lot of dimple-clad teenagers feverishly downloading thousands of pieces of music onto computers and illegally distributing them worldwide in a myriad of formats. In reality, a large number of students use P2P services only to experiment with new music and to make personal copies.

They caricature us as an undifferentiated lot of dimple-clad teenagers.

Music companies may legally have the right to stop P2P services. Doing so, however, will only hinder the acceptance of the adoption of digital media on the Internet and turn public opinion against what some see as the attempt of a greedy Goliath to obstruct the honest intentions of a David.

While writing this column, most students with whom I spoke expressed their desire for an easier, more reasonable medium for purchasing music. They say they are willing to pay for such a service--but only for artists and tracks they want to hear.

In a recent conversation with an executive at a leading music company, I came closer to understanding the real problem that the labels have with P2P services. They do not necessarily see a threat in teens downloading free music and then not buying the tracks. Instead, they are worried about the possible breakdown of their current hegemony over music creation and distribution. Until they find an Internet strategy that leaves them comfortable, they will stymie any technological advancement.

One solution proposed by Hollywood is to simply ban P2P networks on college campuses. Unfortunately, such an approach would prevent many fair uses of this technology. To limit the downloading of illegal content, many colleges and universities have indeed instituted bandwidth restrictions for their dorms, obstructing the massive transfer of audio and video files, which tend to have relatively large sizes. Fortunately or not, such rules have not had a major impact on the demand or use of file-sharing services.

Expecting universities to constantly monitor the flow of traffic on their networks, (or allowing organizations such as the RIAA to do so on a regular basis) in order to check for the transfer of copyrighted material, is not a reasonable solution.

The case for compromise
Why is a compromise in everyone's best interest? Take the case of Sony, which operates a strong electronics wing along with several music labels under its Sony Music brand. It is not uncommon to see students parading through campus with a Discman, playing the latest MP3s that they just downloaded. Sony's overall strategy has been to accommodate new music technologies by generating new revenue streams and changing its business strategies.

Technology companies can fill a valuable niche here by working with media companies to provide a mechanism through which digital media can be seen and heard. Consider, for example, Apple Computer, which is already enjoying success with its newly opened iTunes music store. The company also intends to make the service available for Windows-based PCs by the end of this year.

Music companies play a vital role in the entertainment industry. They are the only ones that have the resources needed to consistently find, develop and promote new talent. Thus, technology evangelists who profess free-for-all replication and distribution rights of copyrighted works must be more reasonable.

But fighting a war against educational institutions and P2P companies is bound to be expensive. The opportunities lost in such a battle are also quite large, especially as Internet radio and streaming audio become increasingly popular. If the recording industry cannot create a compromise for its Internet strategy, the future is clear: P2P alternatives will continue to develop, and organizations like the RIAA will wind up in one court battle after another and end up with one heck of an image problem.

If the music labels want to play a defining role in the future of new media, they'll need to work with Silicon Valley to establish mutually beneficial terms. Otherwise, the occasional blasting of copyrighted music from the speakers of students in college dorms will be the least of the their worries.