Yesterday, Microsoft agreed to share revenue from Zune sales with record labels and artists. Forcing the issue was Universal Music Group, which at deadline is the only label named in the program. UMG refused to license its music to the Zune unless it could receive a percentage of each device sold, in addition to standard music licensing fees for downloads and subscriptions.Just so we're clear, Microsoft is selling Zune players empty of any Universal-branded material, and UMG still demanded a cut. Why? Because these devices are just repositories for stolen music, and they all know it.
"These devices are just repositories for stolen music, and they all know it," UMG chairman/CEO Doug Morris says. "So it's time to get paid for it."
How do they know it? Well, not because of their own research, which has repeatedly shown that a) large-capacity MP3 players are more likely to be filled by people who own large, legal music collections, not illegal file-sharing, and besides b) the people who "steal" the most music from file-sharing are also, unsurprisingly, the people who purchase the most music.
But don't forget, they just know that they're chock full of stolen media. Life is so much simpler if you don't have to justify your statements, and simply assert them as fact. And if you don't fill your Zune with stolen media? Any bets on getting your cut back from the media companies?
Aside from being childish and irrational on the part of the music companies, this is an upsetting precedent. What we have here is one large company (Microsoft) agreeing to presume the guilt of its customers, and change it's business practices because of that, all at the behest of other large companies. The idea that they're operating on a faulty premise, or that even if true their conclusion is bizarre, seems to have never entered the equation.
The only thing that makes me happy in the scenario is that the Zune is getting shitty reviews, and I hope it sells crappy for the Christmas season.