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XM Radio pulls PC hardware amid piracy concerns
Published: August 30, 2004, 4:58 PM PDT
By Paul Festa
Staff Writer, CNET News.com
Owners of a controversial PC radio receiver are making a killing selling their units on eBay following the unit's discontinuation over music piracy concerns.
Before being quietly discontinued this month, the XM PCR was one of several hardware devices sold by XM Satellite Radio to give its more than 2 million subscribers satellite radio reception. In conjunction with a third-party software title called TimeTrax, however, the PCR let listeners download songs to their personal computers.
Since XM discontinued the PCR, units have fetched steep premiums on eBay. The device, which retailed for about $50, is getting bids of more than $350 in recent auctions, with sellers advertising the unit as "discontinued" and "rare."
XM declined to confirm the discontinuation of the PCR.
"We don't comment on when products are being discontinued or not," company spokesman Chance Patterson said. "It's just a matter of policy."
But a source close to the company confirmed the discontinuation, as did a distributor of XM hardware.
"We put in an order on August 18th, and they never filled the order," said Ryan Morris, owner and site administrator of St. Louis-based XMFan.com. "Then they contacted us and said they'd discontinued the XM PCR."
The demise of the PCR comes as the recording industry battles music copyright threats on multiple fronts. Record companies, which have repeatedly filed lawsuits against people who use file-sharing programs such as eDonkey, Grokster, Kazaa and LimeWire, recently lost a crucial battle, when a federal appeals court ruled that file-swapping software programs were legal.
After years of battling file-sharing networks and individual file swappers, the recording industry found a new nemesis in TimeTrax.
Sold by Scott MacLean, an independent programmer in Bolton, Ontario, through his NeroSoft Web site, the TimeTrax software lets people with a PCR capture songs, artist and title information from the radio.
XM said that whatever its plans for the PCR, the company is working to stop TimeTrax.
"We continue to pursue appropriate options related to TimeTrax, including any legal or other options," company spokesman Patterson said.
With respect to the PCR, Patterson stressed that sales of the unit made up a tiny fraction of the company's business, half of which comes from pre-installed tuners on automobiles.
Distributors and subscribers alike have speculated that the withdrawal of the PCR from the market was a direct consequence of the TimeTrax controversy. A source close to the company agreed that the TimeTrax situation had influenced the withdrawal of the hardware.
Listen, don't keep
The Recording Industry Association of America, or RIAA, has been paying close attention to XM Radio, especially after TimeTrax gained a following and media coverage.
"We are very concerned about a variety of technologies that essentially transform performances into music libraries," RIAA spokesman Steve Marks said. "We have communicated our concerns to XM and other broadcasters and Webcasters, (and told them) that we'd like to work together with them to address technologies that hijack these performances."
Marks said the RIAA wasn't behind the discontinuation of the PCR.
"We've raised the concern generally," he said. "They've obviously decided to take this action on their own. We've identified for them the potential problems."
Digital radio stations are in a tough spot between the recording industry, from which they license music, and subscribers, who want maximum flexibility in exchange for their monthly fees.
In response to that demand, XM has promised a 30-minute rewind feature on some of its receivers but declined to say when either its subscribers or satellite radio listeners generally could expect to find TiVo-like recording and playback features on the market.
Now subscribers are paying extra for what has become an eBay collector's item, and distributors are wistful about the craze.
"It sucks for us, because over the past week, there's been so much interest in the PCR," Morris said. "Everyone wants one right now."
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