📸

MusicNet and Pressplay, the label-sponsored online music services, launched at the end of 2001 and included so many restrictions, including prohibitions on copying all but a handful of the files onto CDs, that they were quickly seen as failures: MusicNet attracted only forty thousand subscribers in its first four months. The major question was only whether their failure was accidental or deliberate, an empty gesture to Congress and the courts meant to show that the record industry was at least trying. Little by little, the labels offered more: Universal, in the biggest move, offered one thousand older albums in the unrestricted MP3 format through its subsidiary EMusic for as little as $10 a month. It said it would release far more through Liquid Audio, one of the many struggling firms that had obeyed the law but had been spurned by the big labels when they sought licenses. Other labels offered locked versions of a few songs over the pirate services, giving consumers an easy way to pay if they wanted to go legit.

But the labels also got nastier on other fronts. They seeded the unchecked pirate networks with fake MP3s from Eminem's latest CD, hoping to frustrate surfers to the point that they would open their wallets. And they hinted for the first time that they might sue consumers who posted the largest number of unauthorized tracks.

The record industry blamed the piracy explosion for a 5 percent fall in worldwide music sales during 2001, the worst drop-off since the introduction of the CD in 1983. Sales of blank CDs topped those of recorded CDs. And it was obvious that no amount of litigation would kill the hydra. "I fear we're getting into a game of Whack-a-Mole," one label executive said. In the nationally televised 2002 Grammy Awards, National Academy of Recording Arts and Sciences president Michael Greene took time out from the congratulations and gyrations to deliver a fiery condemnation of what he called "the most insidious virus" of unauthorized downloading. Greene called for a better effort to educate music fans about how they were hurting artists and stronger "leadership from Washington."

Greene's own efforts at leadership and education, which were met with scattered hoots amid the applause, could have been improved in their timing and attention to accuracy: His speech came immediately after he had bestowed a lifetime achievement award on bribe-taking disc

📸