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Technology Stocks : Diamond Multimedia -- Ignore unavailable to you. Want to Upgrade?

To: bob zagorin who wrote (3733)	10/15/1998 1:44:00 AM
From: StockJock-e	Respond to of 4679

I predicted this would come.. #reply-5856029 Came sooner than expected... MP3 is the future of the music industry, the big shots better find a way to profit off it, eg, by encoding MP3's in a format that only certain players can decode, and take a % from sales of those players... There are many ways to profit off this new technology, hopefully DIMD will make the most of it.

To: bob zagorin who wrote (3733)	10/17/1998 11:31:00 AM
From: Jonathan Quick	Respond to of 4679

RIAA's take on the restraining order: RIAA Wins Restraining Order Against MP3 Recording Device Federal Court Views Device In Violation of the AHRA ---------------------------------------------------------------------- Los Angeles, Calif., October 16, 1998 -- A federal court today entered a temporary restraining order (TRO) to enjoin the distribution and sale of Diamond Multimedia's Rio portable MP3 recording device. The court granted a motion filed by the Recording Industry Association of America (RIAA) and the Alliance of Artists and Recording Companies (AARC) seeking a TRO based on the judge's conclusion that the organizations are likely to prevail on their position that the Rio violates the Audio Home Recording Act (AHRA). The temporary restraining order remains effective for a period of 10 days, therefore the court has scheduled a hearing on RIAA's and AARC's motion for a preliminary injunction on Monday, October 26. "While we are gratified by the court's action today, it is unfortunate that we had to resort to legal action to deal with this issue," said Hilary Rosen, president and CEO of RIAA. "Our preference has always been to work together with the many computer and consumer electronics companies to arrive at solutions to legitimize the commercial marketplace for digitally distributed music in a manner that protects the rights of artists." The court ruled that Diamond Multimedia's MP3 recording device Rio violates the Audio Home Recording Act (AHRA), which was enacted as a result of the risks posed by unauthorized digital copying of music. Under this law, the manufacturers, importers and distributors of digital audio recording devices receive a limited immunity from liability for copyright infringement, only if in exchange they pay a royalty to compensate the artists, composers, musicians, publishers and record companies who are hurt by unauthorized copying; and incorporate into their products a "serial copyright management system" (SCMS) to prevent the unauthorized making of second generation copies. These are minimal legal obligations required under this law, and the court has ruled that Diamond Multimedia's Rio product is not in compliance. "The RIAA welcomes the development of new technologies that provide new means for artists to make their music available to consumers," said Rosen. "Our member companies have been working with consumer electronics and computer companies to create such products in a way that respects the rights of music artists. Diamond's product Rio was destined to undermine the creation of a legitimate digital distribution marketplace, and as such we remain committed to working together with companies that make portable digital recording devices for music, so that everyone benefits." The AARC is a non-profit organization that resulted from the joining of forces of artists and record companies to distribute AHRA royalties, and is the leading common agent representing them. Guided by a board of 17 featured recording artist representatives and 17 record company representatives, the organization provides equal representation to the artist community and recording industry and looks after their mutual interests. The AARC currently represents over 1400 artists and 120 record companies. The RIAA is a trade association whose members create, manufacture and/or distribute approximately 90% of all legitimate sound recordings produced and sold in the United States. One of the organization's primary missions is to safeguard the intellectual property rights of recording artists and member companies. RIAA Contact: Lydia Pelliccia, 202.775.0101, lpelliccia@riaa.com

To: bob zagorin who wrote (3733)	10/17/1998 12:06:00 PM
From: Jonathan Quick	Respond to of 4679

Bob, Just finished reading some of Diamond's legal papers filed in opposition to the issuance of the restraining order. Diamond's position is very weak in my opinion. Here are a couple of key points: 1.) Diamond maintains that the Rio is not a recording device even though the company admits in the same brief that Rio will "store" 32 MB worth of music. I fail to see the distinction between storing music for playback and recording music for playback. I doubt the judge will either. 2.) Diamond also maintains that Rio is not capable of serial duplication of recorded music. This is simply not true, in my opinion. Here's a hypothetical: Let's assume I own a Rio and I have access to the Internet. There is absolutely nothing to prevent me from downloading pirated MP3 files from IRC conferences and recording them for my listening pleasure in Rio's 32 MB of memory. Just in case you're interested in seeing RIAA's side of things, check out www.riaa.com. Jonathan