Zookz: Unlimited downloads, one price
Hear that popping sound? It's the sound of executives in the music and movie industries taking an extra dose of heart medicine. Wednesday, a new site called Zookz began public beta-testing a service that will let users download an unlimited number of MP3 music files for a single monthly fee of $9.95. Users can also download an unlimited number of MP4 movies for the same price, or both music and movies for $17.95 per month. Those are unprotected, DRM-free downloads that can be transferred to any device or shared an unlimited number of times.
Of course there are a few catches. Currently, the site only has about 50,000 tracks--a paltry selection compared with iTunes, Amazon MP3, and other services, although the company promises to add 5,000 tracks per week. In its current early beta state, there's no browsing among titles--you have to search, which requires you to know exactly what you want, and then hope it's in the (currently tiny) Zookz database. (I didn't test it for movies, as the focus of this blog--and my main personal interest--is music, but the selection's even smaller there: only 1,500 titles.)
How can Zookz possibly get away with this when the only other subscription music-download service I know of, eMusic, charges more for a limited number of monthly downloads? Simple. According to its FAQ, Zookz is based in the Caribbean nation of Antigua, and isn't subject to U.S. jurisdiction, including copyright law. The company claims it's operating in line with a 2007 World Trade Organization agreement between Antigua and the U.S., a claim I have absolutely no qualifications to evaluate one way or the other.
If you're willing to trust Zookz with your credit card information, you can fill your hard drive and all your portable music players with music for a very, very low price. Get it while it lasts....
Yes, it's that simple. (For the record, I already own this album on vinyl, but have been too lazy to rip it.)
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Matt Rosoff is an analyst with Directions on Microsoft, where he covers Microsoft's consumer products and corporate news. He's written about the technology industry since 1995, and reviewed the first Rio MP3 player for CNET.com in 1998. He is a member of the CNET Blog Network. Disclosure. You can follow Matt on Twitter @mattrosoff. 
I, too, am curious as to whether they have the legal right to distribute content as they are. It makes me wonder: could companies bypass the US laws that make software rentals illegal by basing themselves there? Could companies provide DVR kinds of services? Just exactly what are the constraints placed on them?
We've seen something similar with on-line gambling. You might recall that some legit gambling companies (listed on the stock exchange in London, even) were based just south of the US. Senior leaders of at least one such on-line gambling operation were arrested while transiting through the US! Their crimes? I guess they were charged with violating US gambling laws, though the company and its leaders were not subject to US laws. (The US does go a bit overboard as it asserts its authority beyond its borders.)
So, when doing business with an entity outside one's own country, what laws apply? In the case of the US, if one buys music that might be considered counterfeit in the US, but perfectly legal abroad, is that legal or illegal? More specific, if Zookz is legal where it is, does that make it legal for US citizens to buy and keep that content?
AllOfMP3.com claimed that they had a license for the music their were distributing, through the Russian equivalent of a rights licensing group, similar to ASCAP or BMI or Harry Fox.
I wrote about this back in 2007 http://deancollinsblog.blogspot.com/2007/04/wto-rules-usa-gambling-ban-illegal.html
Now we will start to see the war of the 'lobbyists' in the USA - who will win the Gambling Lobbyists or the Film and Music Lobbyists?
I guess we'll see how the USA reacts to playing to global rules now.
(btw they could have done this to any industry, cars, software, computer designs etc .... it's just that Music and Films being digital are the easiest to do so).
http://www.nytimes.com/2007/12/22/business/worldbusiness/22gambling.html
and here is the one from the WTO
http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds285_e.htm
- by hmj45 July 9, 2009 4:09 PM PDT
- WTO gives Antigua right to violate U.S. copyrights in gambling dispute
- Reply to this comment
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(11 Comments)Published: Friday, December 21, 2007
PARIS ? In an unusual ruling Friday at the World Trade Organization, the tiny Caribbean nation of Antigua won the right to violate copyright protections on goods like films and music from the United States - worth up to $21 million - as part of a dispute between the two countries over online gambling.
The award comes after a WTO decision that Washington had wrongly blocked online gaming operators on the island from the American market at the same time it permitted online wagering on horse racing.
Antigua and Barbuda had claimed annual damages of $3.44 billion. That makes the relatively small amount awarded Friday, $21 million, something of a setback for Antigua, which had been struggling to preserve its booming gambling industry. The United States had claimed that its behavior had caused only $500,000 damage to the Antiguan economy.
Yet the ruling is significant in that it grants a rare form of compensation: the right of one country, in this case, Antigua, to violate intellectual property laws of another - the United States - by allowing them to distribute copies of American music, movie and software products, among other items.
"That has only been done once before and is, I believe, a very potent weapon," said Mark Mendel, a lawyer representing Antigua, after the ruling. "I hope that the United States government will now see the wisdom in reaching some accommodation with Antigua over this dispute."
Though Antigua is best known for its pristine beaches and tourist attractions, the dozens of online casinos now based there are vital to the island's economy, serving as its second-largest employer.
By pressing its claim, trade lawyers said, Antigua could set a precedent for other countries to sue the United States for unfair trade practices, potentially opening the door to electronic piracy and other dubious practices around the world.
Still, implementation will prove difficult, the lawyers say.
"Even if Antigua goes ahead with an act of piracy or the refusal to allow the registration of a trademark, the question still remains of how much that act is worth," said Brendan McGivern, a trade lawyer with White & Case in Geneva. "The Antiguans could say that's worth $50,000, and then the U.S. might say that's worth $5 million - and I can tell you that the U.S. is going to dog them on every step of the way."
The United States has aggressively fought Antigua's claims at every step.
A WTO panel first ruled against the United States in 2004, and its appellate body upheld that decision one year later. In April 2005, the trade body gave the United States one year to comply with its ruling, but that deadline passed with little more than a statement from Washington that it had reviewed its laws and decided it has been in compliance all along.
From the start of the case, the United States has claimed that it never intended to allow free, cross-border trade in gambling or betting services. Those activities are restricted in the United States, though some form of gambling is legal in 48 of the country's 50 states.
In May, the United States announced that it was rewriting its trade rules to remove gambling services from the jurisdiction of the WTO. Washington has already agreed on deals with the European Union, Canada and Japan to change the treaty but it has yet to reach agreements with a number of other nations, including Antigua.
On Friday, the U.S. trade representative issued a stern warning to Antigua to avoid acts of piracy, counterfeiting or violations of intellectual property while negotiations were under way, saying such behavior would "undermine Antigua's claimed intentions of becoming a leader in legitimate electronic commerce, and would severely discourage foreign investment in the Antiguan economy."