The Digital Media Losers of 2006

By Richard Menta 12/20/06

We have released the year's winners list. Now for the Digital Media Losers of 2006:

1. StreamCast

The last holdout from the MGM v Grokster case, that case created the new test of "Active Infringement". The Supreme Court sent the case back to the lower court to define and apply the new test, which the folks at Streamcast were confident they never violated. The lower court ruled they clearly did.

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2. EchoStar Communications

Parent company of the Dish Network lost a huge $90 million patent lawsuit to Tivo.

3. Sharman Networks

Crushed in Australian court. Has settled with the record industry for $100 million, but to date no commercial P2P app that has come to an agreement with the music industry is showing any ability to gain traction in the pay-per-song market. The fact that KaZaa has not been updated since its acquisition by Sharman proves the glory days are long gone.


In September the major credit card companies blacklisted the Russian paid download service. Then became a pawn in US/Russian trade negotiations where it was used as a barganing chip in discussions over Russia's entry into the World Trade Organization. The Russians aggreed to shut down illegal sites, but is still online - with site traffic up according to Alexa. The RIAA has now announced it will sue for damages and its domain. Odd why such a suit is necessary if that site is supposed to disappear soon? Maybe, just maybe, there is more here. We originally wrote off, but now wonder if it could become... the comeback kid of 2007?

5. Captain Copyright

And his sidekick Lieutenant Lame...

6. OLGA - Online Guitar Tablature Archive

Shut down again. As far as the music publisers are concerned, if you can figure out the chord progressions of your favorite song - of which 95% of rock songs consist of nothing more than three common chords - you must pay them. If you put them online to save others the trouble you are a thief.

7. BLU-Ray and HD-DVD

Mass consumer adoption will not occur until the dust clears - which may take years. Beta and VHS all over again.

8. Amazon Unbox

Troubled functionality and dubious terms created a backlash in the press. Overall, many questioned the value it offered to consumers.

9. Sony BMG

Shelled out $1.4 million in settlement to the states of Texas and California for last winter's rootkit scandal. A few days before Christmas it spent several more million dollars to settle with 39 additional states. Worse for the company is that these lawsuits kept the scandal in the press for over a year, a scandal that taught users to fear the CD format.

10. Digital Rights Management

DRM is not going away soon, but to date it has not succeeded at doing what it was designed to do - stop file sharing. It has succeeded in annoying the consumer, though. Whether that might lead to mass consumer rejection is unclear at this point.

Other MP3 stories:
The Digital Media Winners of 2006
The Digital Media Winners of 2005
The Digital Media Losers of 2005


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