MGM vs Grokster

There’s plenty of news around on the MGM-Grokster case which goes before the US Supreme Court Tuesday. But what are the implications for the mobile music space?

The real danger, just as in the wider digital music space, is that it will stifle innovation. The mobile platform offers so many possibilities for compelling services — services people will pay for. There’s a reason the innovation is coming from third-party vendors, not the major record labels. You’ve got people like Andrew Lack, the head of Sony Music, telling the court that Grokster and P2P should be illegal because he can’t figure out how to make it work, while smaller acts and labels are using it to boost sales: “”I might as well make as many people fans of our music, whether they illegally download it or not,” says V2 Records President Andy Gershon.

The Economist gets it: “But it is not clear that curbing illegal downloading will translate into extra sales for the music business. A rush into legal downloading would hardly be good for sales of CDs: some cannibalisation is inevitable. And perhaps the decline in global sales is indicative of a far greater problem for the music industry — consumers simply think that many of its products are just not worth paying for.”

Mark Cuban, a content owner (who also happens to be bankrolling Grokster’s defense) gets it, too: “We are a digital company that is platform agnostic. Bits are bits. We dont care how they are distributed, just that they are. We want our content to get to the customer in the way the customer wants to receive it, when they want to receive it, at a price that is of value to them. Simple business.”

The proposition seems pretty clear: embrace digital technology, support it and utilize it rather than running from it. The payoff is there.

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