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

To: Scott Garee who wrote (3763)	10/26/1998 10:10:00 PM
From: Jonathan Quick	Respond to of 4679

Scott, I quoted your statments in full. There was no lack of context. Your previous message was poorly written and internally contradictory. The whole recording issue basically rests on your claim of the equivalence of Rio flash cards to cassette cartridges. A blank cassette is $10 for the best. A flash card is $100 You've once again confirmed an equivalent relationship between recordable cassettes and Rio's memory modules. They perform the same basic function. Your cost argument is meaningless due to differing performance characteristics between the rewriteable media under consideration. The fact that analog recording media is significantly cheaper than digital recording media is hardly a revelation. Do you really believe that someone will pay me >$100 for a flash copy of a $14 CD? Remember, I have to charge a premium over the cost of the flash card to make it worth my while. The court is not foolish, they will not make a ruling based on ludicrous arguments. You are comparing the cost of a pre-recorded CD that cannot be rewritten containing legally recorded material to the cost of a memory module capable of storing several thousand illegally copyrighted selections over the lifetime of the Rio recording device. I agree there is something ludicrous being argued here, like comparing apples and oranges. You legitimize Rio by confirming that it is a PC peripheral and is useless without a computer, thus is exempt from AHRA. The word "peripheral" does not appear in the AHRA. I have never indicated that Rio is a "peripheral." Rio is a hybrid. For recording purposes, Rio admittedly requires an output device with a parallel port interface. For playback, Rio operates as a standalone unit. How is MD better? Bigger, mechanical, proprietary, not what I consider better. You ever try mountain biking with a MD? Did you stop to compare the dimensions of the portable technologies under consideration? Sony MD - 3-1/4"W x -3/4"H x 3-3/16"D Diamond Rio - 3 1/2" x 2 1/2" x 5/8" MD is also hardly what I would term proprietary. There are well over a dozen major manufacturers selling MD recorders. There are two additional considerations which you omitted: quality and cost. MD wins on audio quality. There are volumes and volumes of material I'll be happy to quote on this subject should you choose to argue the point. Media cost is an even more pronounced advantage for MD. $100 buys three 10 packs of minidiscs that store a total of 2220 minutes of audio. The same $100 buys a single 60 minute memory upgrade module for Diamond's Rio. Rio cost per minute - $1.67 MD cost per minute - $.04 If the issue doesn't involve the number of illegal copies which can be made, then the court is wasting a lot of time and money on an irrelevant issue, as is RIAA. If the number of copies is not an issue, then what is the RIAA's concern? Maybe it really is the loss of control over the media market? The issue is the ability of the Rio owner to store an unlimited number of MP3 files containing pirated music over the life of the Rio recording device. The issue is theft. Implementing SCMS would negate this issue. I can make illegal copies of copyrighted music with many existing technologies, including minidisc, CDR, DVDRAM, laptop computers, palmtops, etc. Why is Rio in violation of AHRA and these others aren't? SCMS does not prevent anyone from making copies. It only makes it slightly more difficult. Laptops and palmtops are excluded from the AHRA. CDR and DVD-RAM are technologies intended for generic computer data storage. I'm not exactly sure how one would pirate MP3 files with an MD recorder. You'll have to explain MD MP3 music piracy in more detail. Rio is intended solely for digitally recording and playing back music. Rio operates independently of a computer. The differences are clear if you're don't intentionally try to blur the lines in an attempt at skirting the law. What about wasting resources by putting useless technology (SCMS) into the device, making it not support the standard it was intended for (mp3) and thus being a non-product. Pirates often complain about SCMS protection on MD/DAT/DSS recorders. There are always workarounds to copy protection, but subverting SCMS is not a simple task to perform. Ethics, a foreign concept to Diamond executives, would be one good reason for implementing SCMS. A better one would be compliance with federal law. Jonathan