Did you know that the company that holds the patent to the MP3 compression algorithm makes nearly $140 million a year in licensing revenues? That's a lot of money the Fraunhofer Society in Germany makes. It is a legitimate gold mine of a patent that they have. I have been pretty interested in the music industry for a little while now and have been following the news about struggling record companies. The RIAA keeps blaming the Internet for their problems. It really just seems like they are reacting to a changing set of rules instead of going out and trying to create a legitimate solution. Their thinking seems to be backward.
After looking at the amount of money made off the MP3 compression algorithm, the proliferation of Apple's iTunes, and the success of portable music players, it seems clear that the music industry has had plenty of chances to expand their revenue, but they have just not had the foresight to do so. If they had just come up with one of these ideas first and executed it well, they could have displaced at least a little of the revenue they say they have lost.
Instead of spending millions of dollars attacking their customers, maybe the record companies should focus on finding new avenues for creating revenue. In short, they should be more proactive instead of reactive.
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