Giving Away Music For Free to Destroy Copyright Piracy: Operation Success, Patient Dead?

Google is trying to get a bit closer to Baidu, the number one search engine in China. Therefore it is offering the users of google.cn free music downloads. It is legal, because all copyright holders have given permission.

Murad Ahmed of the Times Online wrote:

"The service is supported by 140 record labels, including the big four (Warner Music, Universal, EMO, Sony BMG), and will earn revenue from advertising on pages that let Chinese web users download or stream licensed music – 350,000 tracks are already available, with plans to have more than a million tracks within a few months. Warner Music said that it would make its entire global catalogue available as part of the deal." Read Mr Ahmed's article here.

Advertising seems to be the only feasible business model on the internet that has emerged and the music industry also wants to give it a try. The music industry might have realised that (to paraphrase Professor Lawrence Lessig in his excellent book Free Culture) to criminalise a whole generation is not the way to go forward.

There is no question about whether this business model decreases the urge to pirate copyrights, but the question is whether the music industry can survive this way. Is it a good idea, or will this turn out to be "operation succeeded, patient died"? 

What do you think?

UPDATE1:

Also listen to/read the interview of Bob Garfield of On the Media with Greg Kot, author of the upcoming book 'Ripped: How the Wired Generation Revolutionized Music'. 

Thanks for pointing out this interview Ron Yu of novacourses.com

UPDATE2:

Mira Veda wrote a nice article for the Huffington Post about it called 'Pirates Stealing Music in China ... US ... Everywhere', don't forget to read the commentaries below Ms Veda's article.

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Alternative Business Models Emerge In Times of Pessimism About a Solution Against Copyright Piracy in China

That copyright piracy in China is a serious problem is confirmed by the article in China Daily. The General Administration of Press and Publication announced that 120 million audio and video products and 500 million unauthorized books a year were pirated. Read the China Daily here.

Eric Priest a research fellow of the Berkman Center for Internet & Society at Harvard Law School, is pessimistic that a solution to this problem will be found anytime soon. In his 79 page article 'The Future of Music and Film Piracy in China' he writes:

"The government's present trajectory in the war on piracy - pursuing a long term plan for improved intellectual property protection through measured reforms, education, and reliance on private parties to enforce their own copyright portfolios - will not solve the piracy problem or bring about significant relief to copyright owners for many years, if ever.

In fact, the Chinese entertainment industry will likely turn to alternative business models that do not rely on copyright law to generate revenue before reliable copyright enforcement becomes a reality in China."

Alternatives of such business models already emerge as one can read in the Shanghai Daily:

Sina Corp, China's biggest Web portal, sells advertising next to the free music streams of EMI Group Plc, Sony BMG, Warner Music Group Corp, Universal Music Group and Taiwan's Rock Records, which can't be downloaded to personal computers. Ad revenue will be shared with the record companies. Read John Liu's article for Shanghai Daily here.

Priest deems an effective crackdown on piracy in China impossible in the foreseeable future, due to political, institutional, economic and cultural barriers. Read Priest's article here (79 pages).

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Alibaba Sued By Music Companies Over Yahoo! China's Alleged Copyright Infringements

Li Xinran of the Shanghai Daily reports about Alibaba, operator of Yahoo China (in 2005 Alibaba bought Yahoo! China, then Yahoo! bought 40 percent of Alibaba) , who has been sued by eleven music companies, because Yahoo! China allegedly provided lyrics, mobile phone ring tones based on the songs and enticed users to download or listen to them online.

Reuters quoted Yahoo! China spokesman Porter Erisman writing in an email: "Yahoo! China respects intellectual property rights and supports the fight against music piracy. The courts have clearly established the precedent that search engine operators are not liable for content posted on third-party Web sites," referring to search engine Baidu who was sued by music companies in November.

Reuters quoted IFPI chairman and CEO John Kennedy writing in an email: "We are surprised and frustrated that they should take this role in China given that they are our partners in other parts of the world".

The eleven music companies, including Universal Music Group and Warner Music Group Corp, claim that Yahoo! China allowed online users to freely listen to the songs and download 229 Chinese and English songs, whose copyrights belong to the 11 companies, from April 10, 2006. The eleven music companies claim 5.5 million yuan (US$687,500) in total for their economic losses and requested that the court stop the defendant's copyright infringements.

The Beijing No. 2 Intermediate People's Court has accepted the lawsuit, according to Xinhua news agency. According to Leong May-seey, IFPI's regional director for Asia this happened in the beginning of January this year.

Read Li's article here, and Reuters' article here.

Read Joe Lewis of WebProNews who alleges that the music industry is in denial here.

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