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RIAA’s sue-the-fans campaign not only achieved nothing, it cost millions too
By CMU Editorial | Published on Thursday 15 July 2010
That report on the Recording Industry Association Of America’s 2008 finances that has been circulating this week – from which we know the boss of the trade body, whose main achievement has been to make the entire world hate the major record companies, was paid $2 million – provides some other fun stats.
The one most people were centring on yesterday was the revelation that the major labels’ American representatives handed over $17 million to the three legal firms who spearheaded the organisation’s self-harming sue-the-fans anti-file-sharing lawsuits campaign in 2008. In return, they recovered $391,000 in damages.
On his Recording Industry vs The People blog, Ray Beckerman checked out the same figures for 2006 and 2007 and claims that the trade body spent a total of $64,000,000 on legal and investigation firms involved in their sue-the-fans campaign during those three years, and brought in a total of $1,361,000 in damages. You can see why Guy Hands expressed concerns over the record industry’s trade bodies when he took charge at EMI.
As previously reported, the RIAA’s sue-the-fans strategy totally failed to deter file-sharers and instead further damaged the major labels’ public image, and in doing so probably encouraged more web-users to go the illegal route when accessing music, so they could kick it to the “evil men” who they assume control the record industry. The association eventually dumped the strategy after years of costly failure.
Of course, to be fair to the RIAA, various suppositions are made to reach the 64 million for one million return statistic, and they might argue that costs in 2006-2008 resulted in extra damages income in 2009. But even if you give the trade body some benefit of the doubt, these stats clearly prove that the US record industry’s strategy for combating file-sharing was not only totally counter-productive, it was also incredibly expensive.
The sad thing is that countless music business people told the RIAA that this would be the outcome of their sue-the-fans strategy before it even began, and those people were routinely ignored. And many of the record industry chiefs who did the ignoring are still in charge of the major record companies.
The big record labels have come a long way in recent years in adapting to the digital era, but further shifts are still required, and you do sometimes worry that – with the people who got it so very wrong five years ago still in control – those shifts won’t be made until another $64 million has been pissed up a wall. Still, it’s not my money.
