The Apple vs. Samsung $1 Billion Dollar Verdict
August 31, 2012
"I was at home thinking about that patent claim by claim, I had what we would call an aha! Moment. I suddenly decided I could defend this if it was my patent -- I took that story back to the jury and laid it out for them and then we meticulously went patent by patent and claim by claim against the test that the judge had given us."
-- Velvin Hogan, the 67-year-old foreman of the jury in the U.S. trial between the Apple and Samsung
I'm sure you've all heard or read about the verdict in the Apple vs. Samsung patent case. It's been in the news everywhere.
I thought I'd just reference some articles about the subject this week, because the verdict could mean more than just a huge monetary reward for Apple (after all the appeals are exhausted).
It could mean a great deal more to the Android smartphone market.
"With the trial stage just completed last Friday, Apple wasted no time filing a notice with the court identifying which Samsung products it will now seek to have banned in the US.," The Verge reports. Read about that here: http://tinyurl.com/9d82cgd
"Apple's patent suit did not challenge Samsung products launched after the case was filed, models including the Galaxy S III, Galaxy Note and others," ReadWriteWeb notes. "Apple's main target with the injunction is the profitable long tail of Samsung's mobile-product line. Every Galaxy S II sold is one fewer iPhone sold." Read about that here: http://tinyurl.com/8hvcoo5
Samsung Electronics started the week by facing consequences of having definitively lost to Apple in their U.S. patent lawsuit. Its shares fell by more than 7%, wiping nearly $12 billion off Samsungs market value. (http://tinyurl.com/9stdxbf )
But in an internal memo, Samsung promises victory and says that eventually "the market will side with those who prioritize innovation over litigation." You can read about that Samsung memo here: http://tinyurl.com/99at7ts
That sounds a bit hypocritical to me since the iPhone was indeed the innovation in the smartphone market.
The patent litigation will continue for some time, with Apple winning Round #1, and the lawyers raking up millions in bills.
The price of defending digital technology patents is obviously very high, and those costs will get higher as more lawsuits like this are filed in the future.
THE 'A-SIDE' - THE INSIDE TRACK FOLLOW-UP
Last week in my commentary 'Some Winners & Losers' I included the news from Rolling Stone about the sales of #1 albums dropping.
This week, it's the same as Rolling Stone writes "Loser Of The Week: #1 albums, again. Last week we listed recent #1s that had precipitous sales drops in their second weeks --Nas, Rick Ross, NOW 43 and so on. The trend continues this week, as 2 Chainz's 'Based On a T.R.U. Story' decreases 67%, selling just 48,000 copies and landing at #2. Ross' 'God Forgives, I Don't,' at #1 the week before last, lost another 36% of its sales, with 28,000 copies, enough for just #8. This trend, we're afraid, doesn't bode well for this week's #1, Trey Songz's "Chapter V," which sold 135,000. Songz' previous album, although it lost out on #1 to Linkin Park's 'A Thousand Suns' in 2010, sold 240,000 in its debut week. That's almost double the amount of Chapter V, and speaks to album sales' growing weakness over the past two years, Adele aside."
Read more about it on Rolling stone here: http://tinyurl.com/9fc2tsq
THE 'A-SIDE' - TRACK 2
ROYALTIES ARE HURTING MUSIC STREAMING SERVICES
Streaming music services Spotify and Pandora are growing in popularity, and raking in revenue. The problem? Music royalties are eating them alive.
"Even at their level of scale and hype ... Spotify and Pandora exemplify the business challenges for digital-music companies," The New York Times' Media Decoder blog writes. "Both are losing money, and for largely the same reason: the cost of music royalties."
Read the rest here on the New York Times: http://tinyurl.com/d2u2uaz
THE 'A-SIDE' - TRACK 3
FROM FORBES MAGAZINE 'WHAT IF iTUNES IS A HAS-BEEN?'
"It's clear that as more iOS devices get sold cumulatively over time, the iTunes revenue per device per quarter is actually going down. It could be that more and more people are replacing their old devices and buying more iTunes stuff on those," write Eric Jackson on Forbes.
"I would expect the iTunes revenue to stay constant per device - or active device - over time. Ideally, it would be increasing over time. It doesn't appear to be happening. And that worries me," he continues.
Jackson goes on to say the iTunes is still a good experience, but it's dated and needs more improvement.
(As we all know, the only constant in all technology is change. If iTunes, and any other online music store, doesn't continually change, consumers will find somewhere else to buy their music)
Read his article here and see if you agree: http://tinyurl.com/cu3bjbj
THE 'A-SIDE' - TRACK 4
POP MUSIC IS GETTING SADDER?
I saw a reference to an article online at Facebook (posted by good friend, DigSin's Jay Frank) titled "Pop music is getting sadder and more emotionally ambiguous" from the Research Digest blogspot and had to check it out.
From that article, "There's a sense that the hits from yesteryear had an innocence and feel-good quality that's missing from today's pop offerings. Now Glenn Schellenberg and Christian von Scheve have confirmed what many suspected -- pop music over the last five decades has grown progressively more sad-sounding and emotionally ambiguous."
And there's more, "Schellenberg and von Scheve found that the proportion of songs recorded in minor-mode has increased, doubling over the last 50 years. The proportion of slow tempo hits has also increased linearly, reaching a peak in the '90s. There's also been a decrease in unambiguously happy-sounding songs and an increase in emotionally ambiguous songs. The findings complement an analysis of pop lyrics from 1980-2007, published last year, that found a drop over time in references to social interactions and positive emotions, but an increase in angry and anti-social words."
One thing is for sure, you're not going to convince the tens of thousands going to clubs every week to get crazy, dancing to the music, and having a good time, of any of this.
If anything, there's a ton of music out there that's simply uptempo pop with no substance at all. But in my opinion, that doesn't make it sad music and I certainly don't see any decrease in "unambiguously happy-sounding songs."
Read the article and see if you agree: http://tinyurl.com/c5mmqd5
THE 'A-SIDE' - TRACK 5
LINKIN PARK PUTS YOUR FACE AND FRIENDS FACES INTO THEIR NEW VIDEO
From Wired, "No member of Linkin Park appears in the band's new video, but some of your closest friends can get some prime screen time with the simple click of a button. The video for "Lost in the Echo," a "personalized film experience" that pulls in images from Facebook to weave your loved ones into its post-apocalyptic storyline, is slated to go live Wednesday at 11a Pacific on the 'Lost in the Echo' website."
"We're trying to make it about the story, rather than just pulling in the novelty or the gimmick of these Facebook photos," said the video's co-director Jason Nickel in a phone interview with Wired. "We're trying to tie your personal life into the actual story, so that it's logical and it seems like it was actually created for you rather than kind of shoehorned in there just because we could do it."
Read the story on Wired here: http://tinyurl.com/9xfje7p
THE 'A-SIDE' - TRACK 6
A FINE OF ALMOST $22,000 PER SONG IS RIDICULOUS, BUT THE COURT SEZ IT STICKS
It's been going on for some time now; in fact for the past five years. In 2007 "the top record companies filed a copyright infringement suit against Joel Tenenbaum, a Boston University student at the time. A jury found that Tenenbaum's infringement was willful and ordered him to pay $675,000 in damages. Tenenbaum argued that the jury award was unconstitutional and the federal judge who oversaw his trial agreed that the amount was "excessive."
Last week a federal court in Massachusetts today upheld the $675,000 damages award against Joel Tenenbaum.
Of course the RIAA raved about the court's decision because they have little else to rave about, since as I reported last week, "the revenue generated by the anti-piracy group has reached a new low. In just two years the membership dues from music labels have been cut in half and have now sunk to below $30 million a year."
If the RIAA wants to claim this as a victory, then I would beg to ask, "A victory for who?"
The fine is preposterous and if Tenenbaum was even able to even pay it, the money wouldn't mean diddly to the major labels who filed the suit, in hopes that it would set an example, and decrease illegal file-sharing and distribution of music by others. That certainly didn't happen, Despite the RIAA and NARAS' spin, piracy is still rampant, and it will continue to be unless they can put all the technology unleashed back in a "Pandora's Box."
Read the article about the case here on CNET: http://tinyurl.com/bnha5pe
THE 'A-SIDE' - TRACK 7
KIM DOTCOM TWEETS THAT MEGAUPLOAD 2 ON THE WAY
Kim Dotcom, the flamboyant character at the center of the Megaupload legal morass, has defiantly laid out his plans for his next distribution project in a series of tweets.
"I am going to turn this world upside down ... MEGA will return. Bigger. Better. Faster. Free of charge and shielded from attacks. Evolution!" the Megaupload founder announced on Twitter.
Read the rest on TorrentFreak here and see what Kim Dotcom has planned: http://tinyurl.com/8usxxmh
THE 'A-SIDE' - TRACK 8
MUSIC COGNITION: NEW ONLINE COURSE FROM BERKLEE
In Music Cognition, you'll explore the mental processes underlying musical behaviors and how emotion, environment, cognitive capacity, personality, individual differences, and other factors influence how we perceive music.
Watch a video of instructor Susan Rogers discussing her new course here: http://tinyurl.com/bp7snud
THE 'A-SIDE' - TRACK 9
FROM CNN: 'HOW ROCKERS (AND YOU) SHOULD PROMOTE ONLINE'
CNN spoke with a bevy of music industry professionals about the biggest blunders bands make when attempting to promote themselves online. Check out their biggest screw-ups that are not exclusive to the musically inclined, by the way.
Check it out here: http://tinyurl.com/8wqfv9w
THE 'A-SIDE' - TRACK 10
NOEL GALLAGHER SEZ ROCK STARS ARE A DYING BREED (DON'T BELIEVE HIM)
From The Hollywood Reporter, "Noel Gallagher has rung the death knell on a particular kind of endangered species: the global rock star. In a new interview in the U.K.'s Sunday Express, the rambunctious former Oasis member bemoans an industry "changed beyond all recognition."
"Rock stardom will die," Gallagher predicts, "because nobody with make enough money anymore to be rock stars."
I think anybody who has been following what's been going on in the music industry the past decade-plus knows the industry "changed beyond all recognition" some time ago. How nice that Noel just became conscious of this now.
As far as his statement, "Rock stardom will die because nobody with make enough money anymore to be rock stars." Goes ... gee, I don't know, maybe we should ask Adele, Taylor Swift, Lady GaGa, Justin Bieber, and even the new "Baby Bieber" Austin Mahone (who just signed a 7-figure deal), what they think about that.
Yup, it's going to be harder for future "rock stars" to make all their money selling music. And harder to sustain long-term careers. But there's gold in them that hills of licensing, merchandising, touring, etc.
In any case, you can read Noel's comments here: http://tinyurl.com/cqp99zm
THE 'A-SIDE' - TRACK 11
SONY LAUNCHES $5 MUSIC SERVICE
From CNET, "Sony announced a lower-cost $4.99 monthly option for Music Unlimited, a plan it hopes will increase adoption of the streaming-music service.
Sony announced its Sony Entertainment Network's $9.99-per-month music plan a year ago at the IFA consumer electronics show, letting customers tap into a library of 16 million songs using personal computers, PS3 game consoles, and Android devices. This year at the show, it announced the cheaper alternative, which offers the same library but which doesn't work on mobile devices."
Read the rest here: http://tinyurl.com/9tnulds
THE 'A-SIDE' - BONUS TRACKS
* Back on May 1, 1973, a young artist named Bruce Springsteen, then just 24 years old, opened up for New Riders of The Purple Sage and Dr. Hook & the Medicine Show -- still riding high off the success of their recent hit "The Cover of the Rolling Stone" at the Ahmanson Theater in Los Angeles. CBS Records filmed the Los Angeles show in color so they could show some of the footage at their upcoming sales convention. It's a raw video and if you're a Springsteen fan, you can watch a video of him doing "Wild Billy's Circus Story" that night on Rolling Stone here: http://tinyurl.com/9ckjz5m
* How about a $25K+ 84-inch TV? Sony has one coming. It features a separate stereo speaker system and passive 3D viewing. Read about it here: http://tinyurl.com/9nav9dq
* Top 5 headphones under $50 (video). When it comes to sound quality, a little money can go a long way. Here are CNET's top-rated headphones that cost less than $50: http://tinyurl.com/9sdayue
* It's a great time to buy a budget laptop, especially if you don't want to wait for Windows 8.CNET rounds up their favorites. These are the computers they would recommend to friends and family: http://tinyurl.com/bql9j4v
Short News Items ...
BUT WAIT A MINUTE, WHAT ABOUT THAT NEW ALBUM WITH CRAZY HORSE?:
NBC News was one of the first to learn of the death of astronaut Neil Armstrong on Saturday, but instead announced the death of astronaut Neil ... Young. "Astronaut Neil Young, first man to walk on moon, dies at age 82," read the NBC News headline shortly after 3 pm EST, which was tweeted out and picked up by thousands of others before it was changed. ( http://tinyurl.com/9vw8omb )
AND HERE'S THE NEWS ABOUT THAT NEW ALBUM:
Neil Young and Crazy Horse's new LP, "Psychedelic Pill," will hit store shelves sometime in October. According to an update on Young's official website, "a double-CD and triple-vinyl will be released because of the lengths of many of the songs.
SIGNS OF INTELLIGENT LIFE HERE IN THE U.S.:
MTV is ending "Jersey Shore," the network says after this season.
STONE SEZ STONES WILL PLAY:
Rolling Stone has learned the band is planning two shows at Brooklyn's Barclays Center to happen before the end of the year.
MADONNA BOOED FOR STARTING HER CONCERT OVER 2 HOURS LATE IN PHILLY:
Madonna's concert was scheduled to start at 8p, but she did not take the stage until about 10:30. Making matters worse for fans was the fact that the opening act was simply a DJ spinning some tunes. When Madonna finally did take the stage, she apparently apologized to the crowd. However, in typical Philadelphia fashion, Madonna was booed, not once, but twice.
WHATEVER GOES UP, MUST EVENTUALLY COME DOWN:
For the first time in 79 weeks, Adele's "21" is not in the Top 10.
BAD 25 COMING:
ABC will air Spike Lee's Michael Jackson documentary, '"Bad25," one of two major projects pegged to the 25th anniversary of the hit-filled album. The film, which will air on Thanksgiving, traces Jackson's creative vision during the making of the 1987 follow-up to his groundbreaking "Thriller."
The Rolling Stones have set a premiere date for their tour film, 'The Rolling Stones: Charlie Is My Darling - Ireland 1965.' The documentary will screen as part of the New York Film Festival on September 29th with an encore showing on October 3rd. Both screenings will take place at New York City's Walter Reade Theater. A box set will follow on November 6th.
WITH A LITTLE HELP FROM PAUL:
A damaged 1877 Steinway grand piano used by Motown artists during the record label's "Hitsville USA" heyday has been restored, thanks to a little help from Paul McCartney, and he's set to play it when it's unveiled next month. The ex-Beatle visited the Motown Museum's recording studio in Detroit last summer while he was in town for a concert. When he learned that the piano on display could no longer be played, McCartney told museum officials he wanted to help restore it.
SAD NEWS FOR NYC RECORD BUYERS, A LANDMARK GONE:
Times Square record mecca, Colony Music, a favorite attraction for performing icons such as Elvis, Mick Jagger and Michael Jackson, will close after 64 years next month because of rapidly rising rents. Founded in 1948, the store has a stockpile of more than 1 million vinyl records and also sells sheet music from virtually every Broadway show and film ever made. Grossbardt said the music at Colony is about to be silenced because his landlord plans to jack up the monthly rent from around $1 million to as much as $5 million.
ELVIS HAS LEFT THE BUILDING, BUT NOT THIS PAIR OF UNDERPANTS:
A pair of Elvis Presley's underwear, complete with stains, will be sold at an auction in Manchester, England, next month, the BBC reports. Presley wore the undies at a 1977 show before the auction house acquired them from Presley's father Vernon. The dirty drawers could fetch up to £10,000, or around $15,800.
WHOLE LOTTA CASH:
"Johnny Cash - The Complete Columbia Album Collection," a massive 63-CD box set will be released on October 30th, and will include 35 albums released on CD for the first time by Columbia/Legacy in the U.S., the first 19 albums (1958-1967) released for the first time in Mono on CD in the U.S. and will be loaded with rarities as well as new compilations. Price tag: $265
"American Idol" desperately wanted Katy Perry to fill one of its vacant judge's seats, so much so, they offered her $20 million , but she still turned it down, TMZ has learned. Sources close to the production tell TMZ that "Idol" pursued Perry relentlessly for weeks, eager to get her to sign on the dotted line. According to TMZ sources, they started the offer at $18 million, but threw even more cash on the table.
YOUTUBE 'BABY BIEBER' SIGNS 7-FIGURE DEAL:
Austin Mahone, the teen YouTube sensation, has signed a distribution deal with Chase Records through Universal Republic Records, the latter of which is home to Owl City, Florence + The Machine, the late Amy Winehouse and Dev. According to label sources, Mahone's Miami-based managers, who also represent T-Pain, were asking for a so-called "360 deal" estimated to be worth $3 million to $4 million. (Source: http://tinyurl.com/8fonznq )
NEW CHRISTINA COMING:
Christina Aguilera's new album's first single, "Your Body," was produced by Max Martin, who also produced Aguilera's last hit, the Maroon 5 smash "Moves Like Jagger," where she was featured. She will perform the song on NBC's "The Voice" on Sept. 17th.
SNL LINEUP FOR FIRST FEW:
"Saturday Night Live" has unveiled the hosts and musical guests for three episodes of its upcoming 38th season. 'Family Guy' creator and 'Ted' mastermind Seth MacFarlane will host the season premiere on September 15th with Frank Ocean as the musical guest. Joseph Gordon-Levitt will host the September 22nd episode with Mumford & Sons as musical guests, and the show will take a British turn on October 6th with Daniel Craig as host and Muse as musical guests.
AUSTIN CITY LIMITS:
Radiohead will kick off Austin City Limits' 38th season. The iconic PBS concert series, premiering on October 6th, will also feature performances by Bon Iver, The Shins and Bonnie Raitt in the coming weeks.
MILEY DOES TWO AND A HALF MEN:
Miley Cyrus will be hopping onboard 'Two and a Half Men' for the sitcom's upcoming 10th season. The 'Hannah Montana' star and singer will appear in a two-episode storyline.
MOTOWN COMING TO THE BIG WHITE WAY:
The Motown story is coming to Broadway next spring, with Brandon Victor Dixon playing the role of the trailblazing Detroit record label's founder Berry Gordy. Gordy and fellow producers Kevin McCollum and Doug Morris announced Monday that "Motown: The Musical" will open April 14th, 2013, at New York's Lunt-Fontanne Theatre, with preview performances to begin March 11th.
Neil Armstrong, the first man to walk on the moon, died last Saturday, weeks after heart surgery and days after his 82nd birthday.
Chris Lighty, the influential hip-hop executive who managed stars including A Tribe Called Quest and 50 Cent, was found dead on Thursday morning at his home in the Bronx, New York. Details surrounding his death have not been officially confirmed at press time, but police sources told the Daily News that Lighty apparently died of a self-inflicted gunshot wound to the head during an argument with his ex-wife Veronica, whom he divorced last year.
The Music Industry Past, Present & Future, And The Internet I answer questions on EconTalk
I did an interview about the industry and the Internet at EconTalk with host Russ Roberts. Russ is also a professor of economics at George Mason University, blogs at Cafe Hayek, and has written three novels that teach economics. He's also the co-creator of the Keynes-Hayek rap video. (And if your understanding of the economic meltdown that occurred needs to be enlightened, this video will do it)
In the interview we talk about the evolution of the music industry, the impact of the digital revolution, and I give my reasons for believing in the virtues and potential of the Internet in enhancing the music industry. I point out, as I have many times here in the newsletter, that the internet allows numerous artists to make money from their music and it can enhance revenues from live performances by expanding an artist's base. We also discuss the challenges facing record companies and I suggest that the full potential of the Internet as a distribution channel has yet to be fully exploited. There's a lot of ground covered, but based on the comments already posted of those who have tuned in, they've enjoyed it.
Read more about it by clicking here.
Quotes of the week
"I caught them naked once. They had a lot of stuff going on, but my perspective at eight was limited. Looking back on it I knew exactly what was going on. He was cool," the rocker said. "I liked David a lot."
-- Slash, talking about finding his mother, Ola Hudson - who was an American costume designer, in bed with David Bowie.
"Congrats to Jersey Shore's Snooki on the birth of her son, who's already registered at the self-tanning section of Babies 'R' Us."
-- Dennis Miller on Twitter
"I know general things about love. How to treat people well, what you deserve and when to walk away. Other than that, love is a complete mystery - and that's why I like to write about it."
-- Taylor Swift, talking to Rolling Stone about the new direction on her upcoming album 'Red'
The B-Side - 'Blips'
THE ONION (www.theonion.com) STORY OF THE WEEK:
Netflix Board Of Directors Meets To Decide If 'Michael' Is Stream Worthy
LOS GATOS, CA-According to sources within the company, Netflix's board of directors held a tense series of meetings Friday to decide whether the 1996 fantasy-comedy "Michael," starring actor John Travolta, should be included among the movies available through its instant-viewing program.
Netflix, which debuted its Watch Instantly service in 2007, boasts a library of tens of thousands of titles, each of which requires at least 70% approval from the seven-member board before it is cleared for streaming.
Reports indicated the final decision on whether to include the Nora Ephron-directed
"Michael," in which a vulgar, cigarette-smoking angel visits Earth, is still pending and has required numerous rounds of voting from the board.
Read the rest here and laugh: Click Here.
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