The Internet is Not a Territory

In 2003 when Apple announced the launch of iTunes, I was in the audience in Cupertino as an independent content provider. It had been many rough years leading up to this.

For years record labels, artists and distributors had been arguing the following points:

John said ” Its money for nothing, Ruth. No one will ever sell much music through the internet.”  (True enough!)
Mark said, ” We aren’t selling on the internet. We should sell there any way we can.”
Jay said, ” Our agreement says we can license music in other territories. This clearly is another territory.  ”

In my search for understanding I turned to my attorney, Marc Greenberg. He said, “No one understands what is going to happen on the internet in terms of intellectual property. But in the eyes of the law, the internet is clearly not a territory. There is no physical space you can go to. It is not like they are planning to sell music on Mars. This is legally, a new format, a delivery system.  While it is going to be hard to understand and control it is clearly not a territory.”

This clarified two huge issues for me. As a music distributor, this tested my ability to stay in business as new delivery systems evolved. Secondly, by what model were artists going to retain ownership of statutory songwriter and performance rights in the long term? As I write this today, I can confidently say that the answer to both of those issues remains mired in the missing link that the music industry has done everything in its power to resist and find new models.

Apple temporarily helped maintain the advantages and liabilities of ownership and kept quite a few record labels in business. But Apple is not a music company its a computer company. The jury is still out in terms of a long-term solution for delivery of intellectual content while retaining the artist’s rights.

Recently I reconnected with my attorney, Marc Greenberg. He was now the Dean of Intellectual Property at Golden Gate University of Law.  I asked him casually, “ When will the law catch up to technology?” His answer was illuminating. It started with, “If you think the music industry is interesting, you should hear about the gaming industry, cloud computing, avatars and internet business communications.”

That was when I asked him to come to The Holbrook Hotel on Nov. 13 to give that exact presentation. If you are interested in how this story impacts your business or in fact your life in other ways, join me- The Alternative Board, the ERC and the Nevada County Bar Association for lunch.

Reserve your seat now.

Ruth Schwartz

Ruth Schwartz is the author of "The Key to the Golden Handcuffs". She is a high performance business consultant and leadership coach. Connect with Ruth to participate in the conversation. Google+, Facebook, Twitter, YouTube .