RIAA throws in the towel - sort of

December 19, 2008 12:56 PM EST

The Recording Industry Association of America is finally calling to a halt its attempts use lawsuits to scare the public into abandoning illegal downloads, the Wall Street Journal reports today.

But while most of the lawsuits may be stopping, it is clear from the RIAA's game plan going forward that this industry is still stuck in the past.

The policy of suing the pants off individuals and holding them up as a public example hasn't exactly scared the public straight.

Illegal downloads continue unabated and if anything the policy may have made matters worse. According to the Journal story, the policy "created a public-relations disaster for the industry, whose lawsuits targeted, among others, several single mothers, a dead person and a 13-year-old girl."

The industry, which has never had a good reputation with musicians or the public, has now deeply damaged its relationship with retail customers, many of whom would much rather bypass music publishers than provide revenue that could be used to prosecute the working mom next door.

The publishers say they'll now work with ISPs to cut down on illegal downloads. That would put the ISPs in the position of police officer, monitoring content and/or traffic volumes and clamping down on their customers. It's unclear how this would benefit ISPs.

The big stick didn't work with end users and it's unlikely to work with ISPs, unless ISPs want to be seen as Big Brother, and act as the the content gateway to the Web.

Getting rid of the nasty lawsuits can only help RIAA's image. But the organization is still chasing its old business model rather than reinventing itself and creating a new one.

In rethinking the business model it is musicians who are experimenting. With some top-tier musicians now giving away music to stoke demand for lucrative live concert gigs, it may be too late for this industry to ever recover.

As both musicians and consumers move away from the traditional music publishing business model, the recording industry may be facing irrelevance.