Leveling the Playing Field

Although you're reading this in October, I had to write it in the middle of summer's dog days—what Washington journalists used to call "the silly season," not so much because there's anything inherently funny about August, but because, in pre-AC DC, all the legislators went home then to escape the heat and humidity, leaving the press corps with little to write about other than "man bites dog" stories.

This summer we've raised a bumper crop of legislative inanities, judicial decisions, international treaties, and business scandals. I'm starting to believe the old adage: Just because you're paranoid doesn't mean they're not out to get you.

First, we had the Supreme Court's decision in MGM vs Grokster. Justice David Souter wrote: "We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties."

I'm not a Constitutional scholar, so I can't weigh in on whether or not the Supremes were acting according to the Founding Fathers' intentions on this one, but it certainly seems to me that this decision could have far-reaching effects on new inventions—not to mention opening a whole can of worms for existing ones.

Apparently I'm not the only one troubled by this. "The President believes that the manufacturer of a legal product should not be held liable for the criminal misuse of that product by others," said White House spokesman Scott McClellan. That seems clear enough—so that makes it a bad decision, right?

Not so fast. President Bush wasn't talking about digital copying, but about a different industry altogether. MGM vs Grokster is, apparently, a good decision when it keeps evil hackers from copying CDs or DVDs. It's apparently a bad decision when it can be used against the manufacturers of firearms, legal products that are frequently used by third parties in "acts of infringement." Just before the Senate slunk out of town for the August recess, it voted 65–31 for S397, "The Protection of Lawful Commerce in Arms Act," which shields firearms manufacturers and dealers from lawsuits resulting from gun-related crimes.

I'm not arguing that Grokster is good and guns are bad. I'm merely saying that I fail to see why one invention should be treated differently from the other. I think everyone ought to play by the same rules—or at least on the same field.

It would, I'm sure, be politically naïve of me to point out—as many others have—that the gun lobby gave close to $2 million in political donations in 2004, while the combined record and movie industries ponied up a whopping $32 million ($32,016,389, to be precise, according to the Center for Responsive Politics).

No, I don't think all that money bought those decisions—I think all that money bought access to the decision makers. Buying access is something the recording industry knows more than a little bit about, as Sony BMG Entertainment's settlement in New York State Attorney General Elliot Spitzer's payola investigation illustrates. In case you missed that, Sony BMG confessed to paying DJs and radio-station programmers in exchange for their playing or "charting" Sony records on their broadcasts. How does this hurt anyone? Basically, it gives an advantage to the players who have the most money.

We audiophiles like to believe that it's all about the music, but when artists have to buy their way onto radio station playlists, it's obvious that it's really all about the Benjamins. The same hurdles confront the garage inventor, who must now worry about how his invention might be used somewhere down the line. If the playing field isn't level, it isn't the biggest players who suffer; it's the smallest.

You might conclude from this that I believe the government is supposed to protect small businesses at the expense of the big ones, but I'm not convinced that that is such a great approach either. I think we need innovators and popularizers. Of course, big companies can be both, but history has also taught us that big firms, if left to their own devices, can also stifle innovation.

For an example of this, we need look no further than the struggle between the Radio Corporation of America (RCA) and Edwin Howard ("Major") Armstrong, the father of FM radio. Armstrong was one of the most creative minds of the 20th century, inventing FM (frequency modulation) radio, the regenerative circuit, and the Super Heterodyne receiver. Armstrong successfully lobbied the FCC to establish the FM band, which was set between 42 and 49MHz, and even created a line of products and a broadcasting network based on that spec. However, in 1945, RCA convinced the FCC to reallocate the FM spectrum to 88–108MHz—which not only made all of Armstrong's radios useless, but also assigned television channels to the frequencies Armstrong's network had formerly inhabited. It also consolidated RCA's stranglehold on AM broadcasting and set back innovation in FM broadcast technology by about 20 years. To add insult to injury, RCA even managed to claim—and to end up owning—the patents on FM radio, denying Armstrong any royalties from the fruits of his labors. Broke and broken, Armstrong killed himself.

Had the playing field been level, Armstrong's better mousetrap would have won the day.

Innovation has been the growth engine of high-end audio from the beginning—on both the music and the hardware sides. There are no "major" audiophile record labels—even the largest is tiny by Big Four standards. That's equally true of high-end manufacturers: Name the most successful high-end company you can think of and compare it to a Sony, a Panasonic, or a Yamaha (all of which make some very respectable, even high-end products).

Yes, it took Sony and Philips to develop the compact disc, but it took Meridian's Bob Stuart to make it sound better. I'm against anything that might have made him have second thoughts about even attempting such a feat. Let's keep the playing field level for all the players.

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