August 30, 2004 4:58 PM PDT

XM Radio pulls PC hardware amid piracy concerns

Owners of a controversial PC radio receiver are making a killing selling their units on eBay following the unit's discontinuation over music piracy concerns.

Before being quietly discontinued this month, the XM PCR was one of several hardware devices sold by XM Satellite Radio to give its more than 2 million subscribers satellite radio reception. In conjunction with a third-party software title called TimeTrax, however, the PCR let listeners download songs to their personal computers.

Since XM discontinued the PCR, units have fetched steep premiums on eBay. The device, which retailed for about $50, is getting bids of more than $350 in recent auctions, with sellers advertising the unit as "discontinued" and "rare."

XM declined to confirm the discontinuation of the PCR.

"We don't comment on when products are being discontinued or not," company spokesman Chance Patterson said. "It's just a matter of policy."

But a source close to the company confirmed the discontinuation, as did a distributor of XM hardware.

"We put in an order on August 18th, and they never filled the order," said Ryan Morris, owner and site administrator of St. Louis-based XMFan.com. "Then they contacted us and said they'd discontinued the XM PCR."

The demise of the PCR comes as the recording industry battles music copyright threats on multiple fronts. Record companies, which have repeatedly filed lawsuits against people who use file-sharing programs such as eDonkey, Grokster, Kazaa and LimeWire, recently lost a crucial battle, when a federal appeals court ruled that file-swapping software programs were legal.

After years of battling file-sharing networks and individual file swappers, the recording industry found a new nemesis in TimeTrax.

Sold by Scott MacLean, an independent programmer in Bolton, Ontario, through his NeroSoft Web site, the TimeTrax software lets people with a PCR capture songs, artist and title information from the radio.

XM said that whatever its plans for the PCR, the company is working to stop TimeTrax.

"We continue to pursue appropriate options related to TimeTrax, including any legal or other options," company spokesman Patterson said.

With respect to the PCR, Patterson stressed that sales of the unit made up a tiny fraction of the company's business, half of which comes from pre-installed tuners on automobiles.

Distributors and subscribers alike have speculated that the withdrawal of the PCR from the market was a direct consequence of the TimeTrax controversy. A source close to the company agreed that the TimeTrax situation had influenced the withdrawal of the hardware.

Listen, don't keep
The Recording Industry Association of America, or RIAA, has been paying close attention to XM Radio, especially after TimeTrax gained a following and media coverage.

"We are very concerned about a variety of technologies that essentially transform performances into music libraries," RIAA spokesman Steve Marks said. "We have communicated our concerns to XM and other broadcasters and Webcasters, (and told them) that we'd like to work together with them to address technologies that hijack these performances."

Marks said the RIAA wasn't behind the discontinuation of the PCR.

"We've raised the concern generally," he said. "They've obviously decided to take this action on their own. We've identified for them the potential problems."

Digital radio stations are in a tough spot between the recording industry, from which they license music, and subscribers, who want maximum flexibility in exchange for their monthly fees.

In response to that demand, XM has promised a 30-minute rewind feature on some of its receivers but declined to say when either its subscribers or satellite radio listeners generally could expect to find TiVo-like recording and playback features on the market.

Now subscribers are paying extra for what has become an eBay collector's item, and distributors are wistful about the craze.

"It sucks for us, because over the past week, there's been so much interest in the PCR," Morris said. "Everyone wants one right now."

11 comments

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Discontinuation - FUD?
I ordered my XMPCR from hp.com on Aug 27th and had it
shipped via FedEX. It arrived this morning. According to
hp.com, they are still available...why go to ebay?
Posted by (2 comments )
Reply Link Flag
er...maybe not
just checked again after my post...seems they are out of
stock...bummer.
Posted by (2 comments )
Link Flag
What About Tapes, CD Burners, MiniDisks...
I don't understand why someone hasn't taken the position that this is exactly the same as taping a song on the radio. What is the difference between taping a song on the radio, making copies, and giving it to my friend? Why hasn't the RIAA sued Maxell, Sony, BSAF? Is it because they have the lawyers to crush the RIAA?

XM is a paid service. Scott MacLean simply created a "tape recorder" for a service that he pays for. Now if he decided to distribute the MP3's that he created to a mass audience, I could understand but he didn't. He simply made a "Sony Walkman" for the PCR - a service that you cannot get without paying for.

So does this mean that I can no longer make copies of my software for backup purposes? If my name is on someone's voice mail, can I sue if they put my message on speaker phone?

What will it take for someone to realize that all the RIAA has to do is to hire someone half-way smart enough to create a music CD that's in a proprietary format and not compatible with MP3's. They won't sell any CD's but no-one will be able to copy music anymore.
Posted by JT_2005 (8 comments )
Reply Link Flag
Pay Per Listen
If the RIAA had it their way, they would make everything pay per listen.

Honestly, these strongarm tactics have turned me off to the music industry almost completely. The record companies say they are defending their artists, but what it really boils down to is the sniveling executives that want to bleed every last penny from the consuming public.

RIAA you have backfired and I am through with you!

I wonder what is next. Do I have to pay a royalty to GE when I illuminate one of their lights?
Posted by Big Tsunami (29 comments )
Link Flag
The hell with them and the RIAA
Well, I had been thinking about sat. radio and this had made up my mind. I wouldn't touch one if they gave it to me.

To hell with them and the RIAA. RIAA = Rich Ignorant American As*holes.

Robert
Posted by (336 comments )
Reply Link Flag
if you can't listen to it
then you can't copy it. I think orrin hatch should just come up with a bill that makes us send our money to the RIAA. lets get rid of that silly nonsence of listening to music and buying cd's just send them MONEY.
Posted by mpotter28 (130 comments )
Reply Link Flag
XM's big mistake
Banning a perfectly legitimate product because it could be used for quasi legal practices is absolutely insane. Based on that thinking, you may as well ban cars because they could be used by a thief to flee a bank robbery. Maybe we should ban pillows because you could smother someone with one? How about banning the internet? Or perhaps computers themselves. Thats the answer! Ban computers. No computers& no internet& no internet& no file sharing& no file sharing& the world is perfect again!

You may say I am being ridiculous with my above statements. I am. But are they any different than banning the XMPCR because it could be used illegally. The vast majority of users, use it as intended, to listen to XM with the convenience of managing it with your PC. It was XMs way to compete with internet radio. A few people will always cheat the system in some ways. The RIAA would not get any money from them anyway. The bottom line is that it is unfair for XM to take this valuable service away from its customers. And give me good reason to consider switching to SIRIUS.
Posted by (1 comment )
Reply Link Flag
Replay Music does this for Streaming Music
You don't need a piece of hardware for this -- just use Replay Music and your favorite high quality streaming music radio station or jukebox service, and it will split tracks into separate MP3 files and tag the songs with the artist and song title. It's really slick, and totally legal.

Here's the Replay Music web site:
www.replay-music.com
Posted by applian (13 comments )
Reply Link Flag
They can't touch NeroSoft
Judges have already ruled that VCR-like software such as time trax is legal under the fair use act.
They can't be touched
Posted by reinmasamuri (3 comments )
Reply Link Flag
No, but they will slit their own throat...
and quit selling the XM PCR.
Posted by boomslang (65 comments )
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