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The business model of the recording industry is broken. Just about everyone knows it, including record label executives. But the industry collectively still seems to have a hard time admitting it.

So it's really no surprise that the Recording Industry Association of America (RIAA), which has gone so far as to sue grandmothers for illegal music downloads, is singing a new heartbreaker: copyright law is broken.

Those are the words of RIAA president Cary Sherman, who believes that the Digital Millennium Copyright Act (DMCA) is letting content creators down. The DMCA, of course, is the copyright law enacted in the United States in 1998 which has, in part, given online service providers, like YouTube, safe harbors from copyright infringement claims provided that they aren't directly involved in the infringement and respond expeditiously to takedown notices from copyright holders.

The DMCA's safe harbors, however, are nothing more than loopholes according to Sherman:

The DMCA isn't working for content people at all. You cannot monitor all the infringements on the Internet. It's simply not possible. We don't have the ability to search all the places infringing content appears, such as cyberlockers like RapidShare.

To be fair to Sherman and the RIAA, one can be fairly certain that Congress never anticipated the rapid growth and evolution of the internet when it wrote the DMCA. And that means they could have never contemplated the rise of services ranging from Napster to Limewire to YouTube. Recognizing this, it is quite possible that had Congress been equipped with a crystal ball, the DMCA would have been structured a lot differently. Perhaps the world would be much tougher for services like YouTube, which was vindicated this year in its copyright infringement battle against Viacom on the grounds that it is protected by the DMCA.

But even if we give recording industry heads the benefit of the doubt, the general problem with the RIAA's position is that it's untenable. If the RIAA can't monitor every single online hub in which infringing content appears, neither can service providers. There is absolutely nothing that can be done to detect every infringement online, let alone prevent it from happening.

If service providers are forced to police the internet on behalf of record labels, movie studios and other copyright holders, you can be sure that the costs -- both monetary and otherwise -- will eventually be passed on to consumers. That's not a good thing, and an overly expensive, overly policed internet won't benefit the recording industry because for all of the challenges it presents, it's still the industry's future. Consumers are simply not going back to buying CDs like they used to.

But don't tell that to the RIAA. It is trying to convince ISPs as well as "search engines, payment processors, [and] advertisers" to voluntarily become the industry's eyes and ears. If that doesn't work? Sherman has a stick; he claims he doesn't want Congress to be involved, but "if legislation is an appropriate way to facilitate that kind of cooperation, fine." Translation: if we can't get what we want, we'll lobby for a replacement to the DMCA.

Unfortunately for the RIAA, it's questionable as to what effect that would have at this stage of the game. The internet is global, and it's really, really big. In other words, the cat is already out of the bag. The future for the recording industry may be bumpy, but there is no doubt that its future depends on innovation, not procrastination. If Sherman's comments are any indication, the industry is still focused on the latter.

Photo credit: hiimniko via Flickr.

Patricio Robles

Published 25 August, 2010 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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