U2 manager: 'Ultimately free is the enemy of good'

U2's manager continues to push ISPs and technologists to take responsibility for protecting digital content.

(Credit: U2.com)

Paul McGuinness, manager of the iconic band U2, sees stronger copyright laws in France, the Pirate Bay on trial, U.S.-based Internet service providers doing more to protect music, and still he isn't satisfied.

In January 2008, McGuinness delivered a speech that would become a call to arms on both sides of the free-content debate. During his address to attendees of the Midem music conference, the largest recording industry trade show, McGuinness lashed out at the "hippy values" of technologists, accused ISPs of profiting "on the back" of music creators, called the Digital Millennium Copyright Act a "thieves charter" and criticized the big record companies for a "lack of foresight."

Last year, McGuinness, stuck one of the world's most popular and beloved rock bands almost dead into the center of the debate over piracy, copyright, and the role of Internet service providers in protecting music and movies from illegal file sharing. The fallout and criticism, much of which came from technologists and proponents of free content, hasn't shaken McGuinness from his views. In an interview with CNET News, McGuinness once again was critical of ISPs, calling some of their recent piracy-prevention efforts insincere and "illusory."

A year after McGuinness' speech, France this month adopted a "three strikes law," which calls for ISPs to suspend a subscriber's service if they are accused three times of pirating copyright material. Here in the United States, the Recording Industry Association of America promised in December that a group of ISPs had agreed to help the music industry protect content. Some ISPs already had adopted strict enforcement procedures and others have started testing "graduated responses." Still, six months later, no major broadband provider has publicly acknowledged working with the RIAA.

Paul McGuinness

(Credit: U2.com)

Question: What kind of impact did your Midem speech have?
McGuinness: Well, I suppose I had become over the years alarmed by the decline in the traditional music industry and I suppose to some extent that is typical of me or a characteristic of mine that I will freely confess is very much part of my own business thinking that the giant music corporations were there to be infiltrated and worked with rather than against.

Our own record deal with Island Records, which was eventually acquired by Polygram, and then acquired by Universal, gave us the opportunity to break U2 worldwide. Island in the early days had 19 different licensees around the world and we were still able to take the Joshua Tree album in 1987 to No. 1 in many countries, as many as 30. So the record company was not the enemy. It was there to be worked with. These extraordinary marketing and distribution machines were there to be utilized--if they would let you get your hands on their controls. That I suppose is what you try to ensure when you make your deal and improve it over the years. That is certainly what we did with U2. So, we never felt victimized by the industry. I know there have been many casualties along the way and there have been people who made bad deals.

But we never really saw ourselves as victims. We improved our commercial terms with our publishers and record company over the years and we've ended up in a situation where there is no sense of unfairness. In fact, there is a strong sense of partnership, which I know is unusual. U2 owns the masters of every song they ever recorded and copyright of every song they ever wrote. I know U2 is an unusual situation, but it's not impossible to get yourself into that sort of a situation. So, the industry has my support if you like--not in all its manifestations. I think it has made several massive strategic mistakes over the years, certainly with regard to the Internet, but I don't hate them.

Give us an update of where in your view the ISPs have changed?
McGuinness: Some of the progress has been illusory. The ISPs as a group make the noises that they are required to make when it comes to what is politically necessary or when there is a scare, say for instance, something about security or pornography or pedophilia on the Internet. That is when you will see a rapid reaction from the ISPs to defend themselves against any kind of legislation or intervention or monitoring. I'm not sure it's a sincere reaction very often because I think the ISPs, if you take them as a group, have for many years been much more interested in selling broadband subscriptions around the world than they have in doing what is right.

What I think is right for them and indeed the content makers, and that would include newspapers, book authors, movie makers, music makers, sports teams, the people who make the free content that ISPs are pumping through their pipes, deserve to be recompensed. Realistically the only way they are going to be recompensed is in partnership with ISPs, who after all, are collecting revenues from their subscribers.

"I think there is a big moral question for civilization. It's not good enough to say that the Internet is free to all and there should be no restrictions on its use."

--Paul McGuinness, U2 manager

And I think the tipping point is occurring round about now. Perhaps broadband subscription sales are saturated in many territories and the ISPs are belatedly but realistically now turning to building revenue collection businesses with the content owners. I just hope it's not too late.

Sometimes when we were discussing these matters, we would talk of who in the world could make the greatest change to this environment and the way people think about this. We frequently came back to Rupert Murdoch. He's is, of course, in the sports business. He is in the movie business. He is in the print content business. He's a content maker and distributor of enormous significance. I thought that it was very interesting that he recently predicted that print content would have to be paid for in the future and the advertising-supported model could now be described as a failure. That was a big tipping point as well. I think that speech of his or declaration was of enormous significance.

I suppose I hope it was a warning, a red light for the ISPs because I do not think they've been sincere in their attempts to work with governments or content owners to date. I think they could have done an awful lot more. All they have to do currently is make the right noises and things go on as before. But will it be too late? I know there are legislative events taking place in France and signs of them in other countries.

The Pirate Bay case is of enormous significance, because there you had some very murky individuals hiding behind these sort of hippy types who front Pirate Bay. But the businessmen behind them have a very sort of shady commercial and political background. So, I think I'd love to see it made coherent, but of course the Internet is International.

It's possible to locate a Pirate Bay-type operation in any part of the world. I think if copyright is to continue and to provide one of the basic building blocks of civilization, and I don't think that's putting it too strongly, there will have to be some sort of willing International support for creative people. And I use a very wide description of what creativity is. I include a football team, which used to fund part of their activities by selling their rights in Southeast Asia. The European football leagues are now available on the Internet when they used to sell those rights on TV.

People would tell me stuff over the last couple of years about the level of cynicism that perhaps exists with the ISPs industry. I'm sure you know what (Deep Packet Inspection) is. When it sometimes is said that it's impossible to get under the hood of the Internet, that is not true. It's taking place on a massive scale anyway for other purposes and for it to take place in order to reward creative people I think would be perfectly possible. But will it happen?

Are we doomed to a future of bad demos and reality TV shows? That's the way the graph is descending.

Do you think ISPs are the last hope of copyright protection?
McGuinness: I think so, yes. Well, the ISPs and indeed, their airborne, their satellite equivalents. I think they bear a huge responsibility to put things right. They ought to want content and they ought to be taking responsibility for making sure that it occurs and it is remunerated.

Do you appreciate what Radiohead and Trent Reznor are doing, trying to find a new paradigm?
I admire what Radiohead have done tremendously in seeking a new model. They would take the view, and I would share it, that perhaps price has been a big problem for the music business. The music business has tried to hold onto a price that was unrealistic for a long time now. I think wider distribution of lower priced things is probably the future.

The feeling in the free-music community is that musicians have profited for a long time. What do you say to the person who says U2 has made plenty of money so why are you complaining?
McGuinness: That's true of U2. It's always very difficult for me to make the case for what's right and wrong because people just say: 'Well, U2 don't need any more money.' That's true, but I am talking about the right and wrong of it here because even though we have the biggest touring attraction in the world, that's not true for everyone.

One of the reasons we have a worldwide audience is that we were able, we usually have, the biggest touring attraction, but that's not true for everyone. It's important to remember the traditional worldwide star-making functions of the big record companies. There's nothing on the horizon to replace that.

"Artists are entitled to get paid, whatever kind of art they do, the same way technologists are entitled to get paid."

--Paul McGuinness, U2 manager

That was what I was always interested in personally as a businessman and manager. We as a band, U2, were excited about the idea of being big all over the world. We freely admit that. I don't know how people will do that in the future. I think the universality of pop music that we've become used to in the last few decades that's in danger. There is, of course, local repertoires, music in every part of the world. I'm not a mad imperialist.

I'm not trying to get everyone to listen to the same kind of music, but the Beatles caught the imagination of nearly everyone in the world. So did Elvis. There have been a few other examples, like U2. I'd hate to see that stop happening.

What do you see as the role of technology? What would you say to technologists who are interested in digital music?
I would really like them to willingly go to the movie studios and the music companies and say this is how we can collect money from the people who are listening to your stuff and watching your movies. We acknowledge that it's the fair thing to do and we have some responsibility for doing it. Let's do it together and let's make some money. I've heard the estimates that half of traffic across the Internet is technically illegal non-paid-for content. That can't go on. It's such a waste. Future generations of artists will face a vacuum where payment used to be. Artists are entitled to get paid, whatever kind of art they do, the same way technologists are entitled to get paid.

But if the technology you develop prevents artists from being remunerated then there's something wrong with it. I'd like to get a moral tone into the discussion. I think there is a big moral question for civilization. It's not good enough to say that the Internet is free to all and there should be no restrictions on its use. I had the experience last year of making a speech to a group of (Members of European Parliament) in Brussels and they were very hostile to the idea of any kind of monitoring or regulation of the Internet, which they regarded as the precursor to a form of taxation. And of course, as politicians, they were against any kind of increased taxation. But it's not taxation. It's paying for something that people are consuming.

One official in Brussels, a senior Brussels civil servant, came up to me after I made the speech. I was there with a small group of lobbyists and he said to me 'In Brussels there are probably five or six lobbyists representing the content worldwide. There are thousands representing the ISPs, telcos and the technology industries.' He said it's really overwhelming the forces you have against you.

I started to glimpse the politics of it at that stage. I hope that our politicians, our journalists our media gain a sense of how much we stand to lose if free prevails. Ultimately free is the enemy of good.

[markdoiron]

Read between the lines of Mr. McGuinness, and what you have is the same, old rant: "We want more money!" I have a solution that won't make Mr. McGuinness very happy, but which I've found imminently satisfying: I don't listen to popular artists anymore. I have found many indy artists who are happy to let me listen to their music because I enjoy it. Where made possible by the artists, I obtain their music through a legitimate source (such as ZunePass). And I'm delighted that the music I now listen to is because I chose it, not because some overpaid middle-man and a payola DJ decided to promote some group on the radio. Boycott RIAA: Don't buy it; don't listen to it. --mark d.

[asspen]

"The Pirate Bay case is of enormous significance, because there you had some very murky individuals hiding behind these sort of hippy types who front Pirate Bay. But the businessmen behind them have a very sort of shady commercial and political background."
What?! There was one businessman involved, and no proof he ever made any profit from the project, merely arranged advertising to help maintain the site. The only ones who have political backgrounds is the entertainment lobby due to the large amount of money they have to throw arround. If the Pirate Bay had political contacts then they probably wouldn't have had a bias judge for they're trial (who is rumoured to have not been randomly selected but picked for the trial). This man is a jackass!

[mexnexus]

I really laugh at these guys....they are in the same league as Metallica, they have had all the "luck" and great deals with record companies and they protect them at all costs and say its not "fair" about internet sampling, sharing.
Just because they made a ton of money doesnt mean the model is not flawed, in fact the record companies and the media en general is so bad and crooked that most people are listening to old bands, old records and "newer" acts and newser bands are just a bunch of same sounding monkeys.
I love how he dodged the Radiohad and NIN question, those 2 examples perfectly give us a sight of what is to come.
THERE will ALWAYS be rats in the music industr, the ones who steal music, the ones who make bad music and sell it as the greatest thing (hint lastest U2 album) record companies that repack the same thing over and over with one left over studio song and sell it, and distribuitors who try to sell a 8 dlls cd for 20.
Sorry guys Ill be still sampling EVERYTHING I WILL BUY if I like it Ill pay it if I dont i delete it and will not pay for a substandard product, heck if in a restaurant I can give back a not good steak why I cant get my money back when U2 makes a recicled album for the third time?

[YankeePoodle]

Free is enemy of good? that sounds like Steve Balmer in 2002. Mr. Paul McGuinness if you want to buy a pacific island all the power to you, but the music industry is not starving to death, they were not extorting people as they used to. Actually they can even do better. Look at the Indian Music industry, they do not make ton of money as their hollywood counterparts do. But by any standards they do produce quality music. Make music as affordable as possible, there is no reason for people to go to pirate bays.

[chadpry]

is that the best picture they could find of this luddite?

[dascha1]

I'm out-of-sync with all of you on this. As someone who has led the major labels and major studio visual/audio content owners from ~1990 to 2007 with hundreds of tech demo's and thousands of documented plans, not to mentioned the out-of-pocket thousands and thousands, if not over a million invested, I can tell you that after meeting senior VP's and decision makers it boils down to one thing - politics. Doesn't matter if your product or software is secure and plays well perfectly with any format, divides the royalties with deal-by-deal rates with writers, publishers, producers, performers. And when you have someone like Biden, I mean, Bono firing off his mouth with whimsical quips like "Mommy, what was a rock star?" in teen magazines, it seriously only divides us deeper into passive currency models. Be an entrepreneur but whatever you do, don't be a traditional Republican in the music industry and speak out about wealth since the value-based $9000 Aston Martin is in YOUR immediate future.

[mikestatic1]

There is a band who wrote a song. They bought a guitar, a bass and a drum set to play it. They either paid for studio time to record it, or they bought gear and recorded it themselves. They have paid money to promote it. Now they have this song for sale. For $1 they will let you listen to that song, anyplace, anytime, for the rest of your life. A frickin' DOLLAR.

Then there are LOSERS who think they are getting ripped off. They should get it for free. Why? Because they feel they are entitled to it.

Guess what? You AREN'T. Stop making excuses for being PATHETIC, and GROW UP. Society can't carry you forever, at some point you'll have to become adults.

[Lumiseon]

I wonder when stupid "Paul McGuinuiss" will realize that people don't like to buy something they don't know if they like. And if sampling and pirating is abolished, you'll see a HUUUUUGE drop in music sales. Then we'll see what happens to the stupid little recording companies.

[iptofar]

Can i return the last U2 album I purchased? Maybe I'm just getting old but It's possibly their worst album ever.

Copyrights were a gift to artists to produce more work. Copyrights are now a corporate money pump paid for by political contributions.

Given all the money the USA has forgiven/given in Bono's causes, you'd think U2 would just be thankful.

[kinniph]

Free is enemy of good???? So is like raping people for $20 just to buy a crappy cd the friend of good?? I don't know about anybody else, but free to me sounds a lot better. Alot of things are free that are not my enemy. Lets make a list. Air is free(currently anyway), walking on a sidewalk. those free samples is grocery stores, free refills at some resturants and a lot more things. Good thing this guy only manages a crappy band and not a country or free wouldn't even exist anymore.

[knobsturner]

The only people making money on record sales are record companies and very large recording artists. Still, I bet that U2 has made more money touring than they have in record sales. The world is changing. A 4MB song can hide anywhere.

[ahickey]

It's strange - we're all quite happy to pay for food, clothes, housing which all cost money to make and support and keep millions of people in jobs and where the big companies all have fat cats making buckets of money, but when it comes to entertainment for some reason it is different.

If anybody who is posting in support of illegally accessed music can honestly say they are happy to work for free then that's fair enought, but like everybody I know I expect to get paid for my work. Why is it so different for creators of entertainment.

Quality costs money.
If you're happy to listen to garage bands thn then that's fine but if you want high quality production and professional recording somebody has to pay.

Same with the movie industry.
Check out any torrent site and it's not free content that is being accessed but the multi-million dollar tv shows and movies. Without an income these cannot be made and we'll be left with cats falling off television on YouTube.

[Cyber9876]

I can't really say that I'm shocked when I read this. Most Producers, Managers, Publishers, writers, performers, hell even the mastering engineers will agree.....it's all about revenue. Unfortunately for us, the music industry as a whole is one big festering sore that keeps wanting more, and more, and more. How do I know? I've worked with everyone for the past 30 years from Led Zepplin, Iggy Pop, Billy Idol, Metallica, Stone Temple Pilots, Disturbed, even newer groups like AFI and most recently, Paramore. Most of these artists are just that, artists. They just want to make music, and have fun, and of course make a few bucks along the way. It's people like this, the real music lovers that should be running the industry, not a bunch of baby-boomer, grey-haired saps who care about nothing but numbers and margin. What the "Music Industry" needs.....is a serious makeover.

Obviously we are moving towards the all-digital age, if we are not already living in it. Mind you, there are some out there who prefer traditional medis such as CD's and Vinyl, but the majority of folks these days are downloading music, whether it be legally through sources such as iTunes, Rhapsody, Napster, ZunePass, etc, or whether it be illegally via P2P networks and/or torrents.

The point is, the sooner these record label execs and board members realize "adapt and overcome, or remain stagnant and die" the sooner they will change their ways of doing business for the good of the consumer and not only their own wallets. CD's should be available just as they are now, but should not be expected as a main source of revenue. Alternatively, the consumer should have choices, that reflect fair prices. Downloads for $0.25 cents a song, not $1.29 (YES I'M GLARING AT YOU APPLE), no DRM (YES I'M GLARING AT ALL OF YOU, APPLE, MICROSOFT, NAPSTER). Consumers should get a discount for buying the whole album, $4.99 for download only and it should be $5.99 for the High-Quality version available in WMV, Mp3, FLAC, AAC, and WMA. Download with Physical Content should also be available, for $9.99 an album, excluding shipping and handling. S&H should be flat rate, $3 for standard up to 5 CD's. $10 for unlimited. How many people do you think would seriously enjoy this type of deal? Revenue and Sales would SKYROCKET! Music with no DRM, available in a variety of formats along with the option to secure a physical copy as well! This is the true music lover's dream.

Overall I would easily drop $50,000 right now just on music if that were the case and the prices mentioned real, and I've got a list of over 10,000 albums to substantiate that claim. It's time for change, and time to adapt to the market. Has the music industry not learned what happens to companies that do not listen to their customers? They fail, no matter how big, they die.

[tsi26]

This guy is old school...welcome to the new age you dinosaur. Even if ISP's kicked everyone off the internet...what/who is going to stop the swapping of USB drives?...moron!

[JacquesDeMolay]

Mr McGuinness tries to justify his position morally by firstly painting those he holds to blame as 'murky' or 'much more interested in selling broadband subscriptions around the world than they have in doing what is right.'; and secondly by presenting himself as being aligned with 'artists' who he says 'are entitled to get paid, whatever kind of art they do, the same way technologists are entitled to get paid'. This is too simplistic (Good Guy vs. Bad Guy) to have any real meaning.

While he might have convinced himself otherwise, he does not represent 'artists', he represents a brand. And he shouldn't be surprised that ISP's are motivated by making money rather than 'doing what is right' - after all, he is a successful businessman.

If you take away his attempt to have some kind of moral high-ground, you are left with what he is really facing: obsolescence. This is a fearful prospect for anyone to face. But to suggest we are entering some kind of dark age as far as art and creativity is concerned is misguided.

[yacahuma]

These people are pathetic. I think the average income in US is between 30 and 50K. These guys deal in millions, and still want more. I am all for paying for a music I like. I only wish I get my money back on all those useless 1 song albums.

[IcedogSVL]

First of all...There is VERY little likeness between what Radiohead did and what Trent Reznor has done. Radiohead pulled off a publicity stunt and released a poor quality-part of a CD online and then simply pulled it back forcing you to go pay the price at retail for the whole cd and better quality. They took the pub and were portrayed as "fan friendly" but pretty much did nothing.

Reznor, on the other hand has released his last two CD's totally online with different price-points with the least amount ($0.00) still getting you a quality copy.

U2 has a lot more of an opportunity to negotiate better terms with the labels than most artists. In the end however, this is absolutely about greed. This is why they are playing the biggest, tens of thousand seat, brutal sound quality, terrible atmosphere STADIUMS on this tour. They make much more money.

[whoneedsfreedom]

First, a correction on a few assumptions. File sharing does not result in lost sales, in fact new sales are generated from them.
http://www.unc.edu/~cigar/papers/FileSharing_March2004.pdf
http://torrentfreak.com/economy-profits-from-file-sharing-report-concludes-090119/
Copyright is necessary, that's why the American constitution provides 17 years for it. It has been repeatedly extended, to the point where it is harmful. Imagine if patents were for 75 yrs, this would have the result of stifling innovation and creating powerful monopolies. Sound familiar?
Secondly, this article features a glaring omission. At the same time U2 is whining about internet users freedoms they are dodging taxes.
http://www.slate.com/id/2152580/
That's right, these people accusing you of something that shouldn't even be considered theft are guilty of the very crime! Ah, the irony.
Maybe we deserve better journalism.

[Cheese McBeese]

Better P2P encryption and anonymity is coming. Very soon, the recording industry ability to track downloads and sue everyone involved in the chain is going to simply end. The ISPs can't implement a three strikes law if they have no idea what is being transported on their networks.

If I were the music industry, I'd pull my head out of my ass and start working on how to leverage a new model while I was still in business. Yesterday is gone. Let it go.

[umbrae]

It can be comical to listen to idiot spout about something they have no ability to comprehend. First off, ISP are - or should be - utility providers. Saying ISPs are responsible is just dumb. That is like saying the power company is responsible for a terrorist creating a bomb. They only provide a service (bandwidth) to customers, and they should not be involved in how that it used.

U2 does not understand that music is culture and culture grows when shared. They are so greedy they think everyone not paying for something is money out of their pockets. However, I bet without MTV or the Radio (old fashion ways of sharing music for free) no one would even know their name.