An old adage has it that "when Sony sneezes, the whole electronics industry catches cold." If that's so, there could be an epidemic brewing. Sony's profits plunged an astounding 98% in the first quarter of its current fiscal year. Thomson, Samsung, and some large retailers also reported big drops.
Bertelsmann may escape the legal wrath of its music industry peers, thanks to a decision rendered by Germany's top court on July 25. The Federal Constitutional Court in Berlin ruled to block delivery of a $17 billion lawsuit brought by other members of the recording industry over Bertelsmann's financial support of Napster. The block is good for at least six months and could be permanently renewed upon full examination of the lawsuit. Bertelsmann has already filed in US federal court in New York to have the suit dismissed.
Will the threat of lawsuits have any effect on the file-sharing phenomenon? The music industry hopes and prays that it will. As of July 19, the Recording Industry Association of America (RIAA) had sought and obtained "at least 871 federal subpoenas against computer users . . . with 75 new subpoenas being approved each day," according to an Associated Press report.
IPOs are jumping and the Nasdaq is up—some mid-summer economic indicators point toward a recovery, but you wouldn't know it from retail reports. Circuit City, Good Guys, and Harvey Electronics are singing the blues, while discounter Costco is whistling all the way to the bank.
The owners of Spanish website Puretunes.com are the latest to feel the wrath of the Recording Industry Association of America (RIAA) in its campaign to rid the world of unauthorized music. The site's parent company, Sakfield Holding, will defend itself against a lawsuit filed July 3 in the US District Court for the District of Columbia. The accusation: providing illegal downloads.
Dragged kicking and screaming into the 21st century, the music industry may finally be settling into an uneasy acceptance that its market and business model have changed. Only two months after the successful launch of Apple's iTunes Music Store, Billboard magazine announced that it would begin accounting for downloads in its weekly music rankings.
Last October, US Senate Commerce Committee chairman and former presidential hopeful John McCain hosted NBC's long-running comedy show Saturday Night Live. In a spoof of the political talk show Hardball, McCain did a devastating impression of US Attorney General John Ashcroft, a fellow Republican. Speaking of homeland security, the faux Ashcroft intoned, "This country won't be safe until every American is in jail."
The numbers are up for Sirius Satellite Radio. On June 23, the New York–based digital broadcaster announced that it had exceeded 100,000 subscribers for its 100-channel music/news/entertainment service. Sirius offers 60 channels of commercial-free music and 40 channels of news, sports, talk shows, comedy, and other programming.