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January 22, 2003 Hilary Rosen Out at RIAA Written by Jerry Del Colliano  For 17 years Hilary Rosen has been the biggest industry advocate for the music business. The RIAA announced today that by the end of 2003 she will be replaced as CEO and Chairwoman.Rosen’s most notable recent work was her legal attack on the file sharing system, Napster which the RIAA ultimately litigated out of business. Consumers were up in arms and record execs were conflicted. On one hand file swapping promoted their music like on radio. On the other hand free files of copywritten music could be costing them sales and their artist royalties. Even with Napster long gone, the debate rages on to this day as does file sharing on the peer-to-peer Gntuella network. In 17 years things have changed dramatically in the music business none more so than in the two last years where the music business posted losses for two consecutive years. Industry critics say that the big five music conglomerates didn’t reel in Rosen and the RIAA’s aggressive tactics because of fears of antitrust. Others say that her work was essential in order fight the widespread illegal distribution of copywritten music. What speaks the loudest in the music industry is losing money hand over fist. And that is exactly what they are doing while at the same time video gaming and home video boom in sales despite of the slumping economy. The new successor to Rosen will be given an opportunity to put on a happy face with all of the parties (consumers who love the convenience of MP3s and record execs and artists who want to get paid for their music) and try to redirect the music business back to the ongoing success that they are accustomed to. Without question, the new leader will have to take a stance about a format to replace the CD. DVD-Audio and SACD are ready and fighting it out in a bloody format war. The RIAA could bring an end to that battle and help add value to prerecorded music so that consumers feel comfortable investing in a $18 disc much like they do with a DVD. Other problems exist. The industry has to figure out what to do with downloadable music. The Rosen philosophy of “we’ll break it before we let the consumer’s have it” didn’t work with Napster. But the solution isn’t simple either. Artist deals need to be renegotiated so that their music can be sold differently. Perhaps adding MP3 material to a new audio format is one solution but limiting the amount of downloads from that disc would help. Finding ways to sell music on hard disc systems loaded with 100,000’s of songs and actually make sure artists get paid would be another challenge. We live in exciting times. The RIAA has fought a tough battle under difficult circumstances with Rosen at the wheel and now are faced with an opportunity to move in a new direction. How well they do under new leadership is likely to radically reflect the long term success of the music business. |
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