Nu hoppas jag att kunna få med mycket mer detaljer i konversationen — generellt får jag klippa lite pingpongande. Jag ligger ofta tre-fyra meningar efter vad som sägs i mitt skrivande, så det som ser ut som en utväxling i mitt livereferat är ofta två eller tre ordväxlingar av typen “Ja”, “Jaså” eller “Hmm” emellan.

Därför bloggar jag på engelska nu.

John Kennedy enters the courtroom.

– Good morning, Mr Kennedy. You have been called to bear witness in the case of the prosecutor vs. Swartholm Warg, Neij, Sunde and Lundström.

John Kennedy takes the witness oath.

– Good morning. We can read from your [submitted] opinion that you are chairman of IFPI, and I would ask you to sum up your job duties.

– As chairman, I run the IFPI’s business. We have approximately 1500 members worldwide and our three main acitivites are to improve copyright laws around the world, to try and fight piracy around the world, and to work with collecting societies around the world.

– Can you elaborate on IFPI’s work concerning anti-piracy?

– It’s a very important part of the work we do for our members. Over time, piracy has hurt the music industry immensely, and our job is to devise strategiess to combat piracy.

– Can you give us examples?

– We try to introduce education generally to the public, we carry out research to discover the sources and reasons of piracy, we lobby governments to help us with piracy, and we assist with litigation.

– Examples of litigation?

– Around the world, there are a number of national groups representing the recording industry. And a number of these countries would, with our encouragement and of their own initiatives, would take strategic initiatives to combat piracy. We give support in this.

– Can you tell us about Grokster and Kazaa?

– To go back a little bit, the music industry as sold its products in a physical form, and we had a piracy problem in the physical world, but it was a relatively low percentage. With the development of digital music, the music industry has a much bigger problem with piracy, there were even some that claimed that copyright did not apply to the digital world, and so, this had to be established in court. The two particular countries where there were first litigation were the USA and Australia where court cases were taken against Grokster and Kazaa.

– How did these court cases finish?

– The supreme court in Grokster decided that copyright laws of course apply in the digital world and they declared that the operation of Grokster was infringing copyright. A similar situation in Australia with Kazaa, and subsequent cases.

– How does The Pirate Bay enter into this?

– The music industry was very pleased with the success against Grokster and Kazaa; these were the main sources of illegal music, but at the time these closed down, The Pirate Bay took the opportunity to build their business.

– I probably first heard about TPB in 2004, but it became an increasing problem as Grokster and Kazaa lefte the market.

– The Pirate Bay was a problem because it was becoming the #1 source for illegal music, and of course, illegal music was harming the legal music industry.

– Can you elaborate on that?

– Naturally, as the world of technology developed, the music industry has developed from a physical world to a digital world. This provided wonderful opportunities but also great threats. One of the features of the last 5, 6, 7 years is that more music is being consumed than ever before, which is a great opportunity, but unfortunately, less is being paid for than ever before. This is a simple proposition that if music is available for free from illegal sources, many people find it a too tempting proposition, and of course we carry out research to analyze behaviour and the message we get is that if it’s there, we will take it; it is your job and the government’s job to stop it. The most damaging thing is that it is very difficult for new business models to thrive if they are competing with free.

– As you know, we have claimed compensation.

– Yes.

– What are your comments on the claims of compensation?

– I know the claims, I have seen them, I think they are justified, and maybe even conservative, because the damage is immense.

– One component in calculating the compensation of damages is what it would have cost do download legally, and at the time of the deed on trial, record companies would have received 6.50 euros per album?

– That is correct, and for a single track, 70 cents (Eurocents).

– What are the ratios for CDs? What do the record industry get?

– CDs vary dramatically in pricing, but in general, CDs are more profitable.

– The record industry earned more?

– That’s correct.

– The money htat the record industry earns, wht is it used for?

– It is used for many things. First, the money comes in — or it’s a risk business, and maybe no money comes in, but when money comes in, there’s the artist to be paid, the studio producer, the song writer, the publisher, the cost of recording, and the cost marketing and the cost of promotion. The music industry spends the biggest amount of money of any industry on research and development.

– What does R&D mean in this context?

– The music industry has become very good at providing a constant supply of new music. The weekly charts around the world change on a weelky basis. There is a continuous demand of new music, and the record compnaies have very sophisticated methoids of finding new artitsts. 20% of rvevenuse are spent on finding new artists. It has been claimed that this is not needed anymore, but htat’s completetly incorrect and I think people are beginning to understand that.

– In what way are your marketing campaigns hurt by The Pirate Bay?

– In any industry, when you bring a product to market, there is a particular stage in which you intend to make your connection with the public. A particular stage in which you launch your product. And all your marketing spent particularly in the musicc industry is designed to make a major impact in week one after release. You want to present your product to the public, media and retailers as a major success. In an ideal world, you want your record to go to #1. This is not always possible, so you set a realistic target. You intend that record to sell a set number to meet a certain target. But if the product is made available on Pirate Bay before that date, then purchases are taken out of the market and because of the illegal use of music, the legal use is seen to underperform. In some countries, this can have a dramatic effect. In Sweden, if you lost a thousand sales in the first week, your record, instead of going to #5, it will be at #20. If you were aiming at #10, which would be very good for a new artist, you would be at #75. If you were aiming for #20, also good for a new artist, you may not chart at all.

– How have the CD sales developed over the past ten years?

– Over the last ten years… the global revenues of the music industry, where CD sales are a major part, have fallen från 27 billion dollars to 18 billion dollars. A fall of more than 30 percent.

– When we are talking about numbers of CDs, are there statistics?

– The top ten sellers around the world would have sold 69 million around the world, and in 2008 they sold 46 million units, and nine years ago the #1 record around the world sold 13 million units, and in 2008 ColdPlay sold about half of that.

– The legal downloading, doesn’t it cover up the difference?

– Unfortunately, no.

– You said the music interest has increased?

– Over the past few years, there has been an expectation that music industry revenues would rise. The industry has a certain reliance on the younger demographic. The younger demographic have gotten used to taking their music for free from illegal sites, and many legal legitimate sites have struggled to compete with free. It’s a very simple proposition: it’s impossible to compete with free.

– People claim file sharing is promoting sales in general?

– That’s a very old fashioned concept with people don’t need to entertain anymore. In 2001, only one survey seems to support this, and since, about five have contradicted, and I don’t really seriously arguing that anymore. And in any event, the artist should have the right to determine how their product is used.

– Through file sharing, the interest in concerts has improved?

– Again, that was an idea that people discussed relatively recently, but not more recently. If you look at the most successful artists from live performances, every single one of them has needed a successful recording career to launch a successful live career. If you have published 21 albums, you can sell concert tickets, but if your first release has gone into #75 instead of, say, #20, you have not been able to build a platform.

– There are also those that claim that TPB don’t differ from search engines like Google?

– I don’t believe that bears for examination. We go to Google and they try to help us stop piracy. Our teams are working on a daily basis with Google to prevent privacy. If you go to Google and type in ColdPlay, you will get 40 million results. These will show you press releases, legal ColdPlay music, reviews, appraisals of their concepts, and a multitude of different things. If you go into Pirate Bay, you will get less than a thousand results, all of which will give you access to illegal music, illegal video or artwork. Unfortunately, The Pirate Bay does what is said in its description: its main aim is to make available unauthorized music. It filters straight material, identifies illegal material, and they do not deny it.

(Points of order – what is the testimony about?)

– How does TPB affect the economic backgruond?

– Over the years, the problems from Pirate Bay have gotten greater rather than lesse.

– How do you know?

– I believbe they’re proud of this, but… their own statistics. There are 22 million users, a million visitors a day, 1.6 million torrent files, I think they say they’re responsible for 50% of BitTorrent traffic around the world, they pride themselves on the quality of what they deliver…

Defense interrupts: THIS IS A POLITICAL SPEECH.

– The damage is that the illegal music draws from the legal sales. The statitics shows that from the time of the start of file sharing, sales have declined, and some more recent resarch we’ve conducted shows the statistics becoming more staggering and frightening.

– In this trial, we have applied a multiplicator [to the damage claims] to how long before the official release the album was avaiable

– I think it’s very relevant. As I said before, the longer before the launch date it’s available, the greater damage is done.

Defense: Fredrik Neij’s lawyer.

– If I look up the trial papers against my client, and look at “Son of the Plumber” by Per Gessle, have you looked at the sales figures of this b

– I have seen sales figures of a typical record played here, but I cannot claim to have expert knowledge of individual records.

– Have you seen sales figures over the Internet of this records?

– Yes, I have.

– Have you conducted your own research of how sales could have been?

– No, I have not. I work with general principles.

– So the general assessmnet you have done when presented with numbers?

– Yes. I have worked in the music industryh in 30 years to examine trends, and in particular, the past 10 years.

– So that means you have not done specific research in the works related to this case?

– That’s not something that I would personally do?

– So the answer is no?

– That’s not part of my role to conduct such research.

– You said that the #1 source of illegal music in 2004 was TPB?

– I don’t think I said that. I became aware of it in 2004 and over time it grew to be #1.

– Have you done any own research into wht

– I’m not an expert on the subject. We commission research. I read a lot of research.

– Has IFPI done its own research into what material is available from TPB?

– We have teams that on a daily basis examine what’s going on on the Internet, and when we don’t have the expertise, we commission expertise, and we resently conducted some research.

– Is it your opinion that the people who have downloaded the specific works in this case, that they

– YEs! I think that people who are consuming music through the Pirate Bay are spending much, much less than they would have done otherwise. These are music fans. [Missed two sentences.]

– Are you aware of the notion that there are young and not particularly well off people are downloading from Pirate Bay?

– Two things. Research shows that some of the developed countries.. You could see a trend in a younger demographic that used to have the money to spend on music, and still have the same money, but don’t spend it on music. If it’s handed to the on a plate, for free, the temptation is too great.

Peter Sunde’s attorney:

– Reduction in sales is directly tied to downloading?

– I… I… yes!

– So if downloading was prevented, these people would have gone and bought these records?

– I think there’s a very large substitutional effect, and because of the digitalization, there

– I’m not particularly in terested in what you believe. What papers do you base this on?

– There is research..

– I would like to know names and papers.

– In this particular case, there are six relevant papers, all of which I’m happy to make available to the court. One of says that there’s no connection; others say that there’s no other explanation.

– So there are papers that claim both conclusions?

– That would be a misrepresentation. The first report said there was not a causal link.

– When was that, and who did that?

– The very first report — I have the date here, if I’m allowed to refer to it… (JK looks up papers in a binder on the desk before him, a name is mentioned) Oberholtze, G, and Coleman, Strumpf. March 2004. Second report says that that was completely flawed, using words like false, misleading, and incomplete, and every subsequent report gives a clear causal link, with one professor in Texas saying there is no other explanation.

– So there are different conclusions from research at different points in time.

– There are six reports. The very first one suggests no causal link between file sharing and falling global revenues. Every subsequent one suggests a definite causal link between file sharing and falling revenues and varying percentages, and one particular professor says, having examined all alternatives, says there are no other explanations.

– What are the percentages?

– The first report from Prof. Liebewitz says… August 2007… he deals with the Oberholtz and Coleman Strumpf paper… and he says that it’s an overstatement that the examinations from this paper holds up well. On repeating the experiments, three of the experiments support the opposite conclusion, i.e. file sharing does hurt sales, and the fourth experiment has false premises and is not informative. Although file sharing has been incompletely and inconsistenly measured, it never fails to reveal a fairly close linkage between changes in file sharing and changes in record sales. Explanations other than file sharing seem to have little or no support.

Judge interrupts: “I understand that it has an effect, but the defense is asking for specific percentages.”

(changing batteries in my laptop. Testimony is still in progress.)

(resuming live blogging. About three minutes missed. In this time, Kennedy again reiterated that the link was complete, suggesting but not stating 100 percent.)

– Have you seen other factors affecting the decline in sales, other than file sharing?

– On of the things is that there are more things for people to spend money on.

Ludnström’s attorney.

– Was the global turnover currently 18 billion dollars a year, or was this profit?

– Turnover.

– How is the profit?

– Terrible.

– Globally?

– Different for different companies, of course, but at this time, only one company is making a profit… Maybe here, I need to divide into four major labels and many independent…

– But if the global turnover is 18 billion dollars, can you or can you not give us a number of the global profit?

– I can’t.

– I understand you said that the turnover used to be 27 billion dollars. When was this?

– 2001.

– What year was it 18 billion?

– 2008.

– How large share of this turnover is used by the record industry to hunt pirates? What is your budget?

– Approximately 20 percent. (!!!!!)

– 20 percent of 18 billion dollars? To travel around in courtrooms and lobby governments? How large percentage of the turnover is the record industry spending fighting file sharing?

– I can give you an idea… there are mainly… there are three types of operations representing the record industry in these areas. There are RIAA in America, IFPI globally, and in different countries, there are different groups like IFPI Sweden. They all have a budget for all their activites, and a large percentage would be used for anti-pirate purposes in different ways. So to give you an idea, the yearly budget for going to litigation for IFPI is the modest sum of 200,000 pounds, but we also have in-house teams that work for…

– But can you give me a global figure, or not?

– Taking a guess… maybe… for.. the lobbying, and the anti-piracy activities, there’s an expenditure of 75 million pounds per year.

– You have been a lawyer since the 1980s?

– Longer, I’m afraid. I think I qualified in 1977. 1976 or 1977. I haven’t practiced law for 12 years but I’m qualified as a lawyer.

– You must be familiar with the technology around BitTorrent?

– In very vague terms.

– Does the person uploading a torrent file need a file sharing program?

– I don’t know, I’m afraid. I’m not a technologist.

– Do you know µTorrent (pronounced “Microtorrent”)?

– I’m… I’m… you can see me as an average user or a lawyer.

– Are you aware that there are owners of CD files are producing torrent files with their own computers using a file sharing program?

– Presumably, different people have different methods.

– So my question then: The people making the torrent files, and linking the torrent files to the CD itself, have you claimed any damages from them?

– Around the world, yes.

– But in this specific case?

– To be perfectly honest, I can’t answer the question, because I don’t know the individuals involved. We have been criticized for going after individuals; press and governments have said we should go after specific individuals, we do sue individuals…

– But this means that you are aware that a part of the damage is caused by these individuals?

– I do not know how The Pirate Bay operates… I don’t know what the source is, but I do know that the Pirate Bay has not been authorized by the rightsholdwers.

– But if you don’t know how The Pirate Bay operates, how can you state that The Pirate Bay should pay the entire damage?

– I do know that this is a result of TPB operations…

– Have you presented any claims against the people using the file sharing programs?

– In some cases of the world, … it’s unlikely…

– Another thing I’m missing from your opinion I’d like to ask you about is how you have anlyzed European Union law whan arriving at the specific compensation claims.

– I can produce our lawyers, I can produce our technologies… I can say that on the base of illegal use, what the compensation would be?

– In what way have you taken [a specific EU directive] the E-Commerce Directive into account?

– If you want me to ask my lawyers…

Judge interrupts: – When you wrote your opinion, have you (you) taken the directive into account?

– Ehm, uhm, I’m really not trying to be difficult, we have in house lawyers?

– I interpret your response that you’re not familiar with the EU directive?

– There’s nothing in this about the EU directive.

– Exactly. No further questions.

Gottfrid’s lawyer.

– Has IFPI conducted any litigation against Google? The reason I’m asking that I’m just seeing 880,000 hits on Google for “ColdPlay torrent”. Has there then been any litigation against Google as it is done against Pirate Bay?

– No. We have approached Google and told them about this. We have asked them if they want to be our opponents or our partners. We have ten people in London working with them on a daily basis [to make illegal music not available]. If Google had indicated they would be our opponent, we would have taken them to court.

Fredrik Neij’s lawyer.

– Are you aware of other reports than the beforementioned six?

– No. Me personally, no.

– Who paid for these reports?

– It’s different. Technology actors… and sometimes we commission reports.

– So are any of these reports paid for, directly or indirectly, by IFPI?

– I’ll need to ask…

– So you don’t know?

– I don’t think so, but for the integrity of the court, I should state I do not know.

Testimony is over.

Court is in recess for 15 minutes. As people leave the public’s chairs, I hear everybody complaining about the terrible translations. (My writing was English firsthand and not the official translation.)

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