Tuesday 3 August 2010

replacing the stick with a carrot levy (another music industry proposal)

The article starts out painting the current picture of the music industry and the perils it has faced and is still facing. I first took issue with disingenuous comments like litigation was their only option because “Napster et al were unwilling to discuss a viable business plan that would fairly compensate all stakeholders”. It then goes on to admit that the stick approach had been favoured in the past by the music industry that it was always litigation as opposed to the license but maybe it is time to explore the options that the carrot may present. It talks about persuading unlicensed content sites to the negotiating table but it is predominately about the old successful models and how good they were and that people really like our stuff and now because of the internet they consume so much more. Then it gets interesting when he starts talking about the pipes that deliver us that content and how they are currently neutral but should that really be the way it should be. He acknowledges that people don’t want to pay, but they are using their stuff and somebody has to pay. This is where it turns nasty and suddenly it’s the entire internet’s fault that the music industry is struggling and that something needs to be done, he then suggests how good the pay TV model is but really if we don’t do some thing about the pipes they too will be doomed.

I wrote yesterday of what I thought was a troubling suggestion that “The struggling newspaper sector take a leaf out of the music industries play book and introduce an adoption of the long-established ASCAP-BMI performance rights model by which they could collect payment for some of their content when it is distributed outside the boundaries of their own publications and websites.”

 I thought this was trying to stretch copyrights reach and proposed a fictional scenario that could happen if this was adopted. I noted that I thought it unlikely that a performance rights model would ever be adopted by the media but I also was careful to acknowledge it was an idea and that although I personally did not like it I respected the right of the author to propose of it. I also have had ideas based on improving failed models and often write of them so I guess it is only fare to acknowledge others work as well.

I also once proposed in another article that we should monetize privacy and that I had written about how today we have the MPAA and RIAA wanting to shut down a very successful distribution platform in the form of piracy and peer to peer networks. I felt that the content industries should utilize non commercial piracy along with their commercial endeavours to legalize a phenomenon that they can’t ever hope to stop.  If other people are distributing your products for free, that is free of any costs and of course revenue why not licence people to use it, why not sell consumers a license that allowed them to source their personal use media from anywhere on the net? So I find it is an interesting juxtaposition to read at TorentFreak this morning that UK version of ASCAP The Performing Rights Society, have proposed collecting royalties by charging internet service providers an amount to cover the cost of illegal downloading happening on their networks.

This sounds like a very similar idea to mine of licensing piracy however I think economist Will Page in his paper “Moving Digital Britain Forward without Leaving Creative Britain Behind” might find some stiff opposition to this plan. I obviously think it has some merits, but I might not agree with his all proposed methodology and some of the supposed givens or acknowledged realities are rather one sided.  I thought this would be an interesting one to comment on since my attempt at a similar idea did not go in to specifics of implementation and this it a rather detailed economic report so I will note my thoughts on the model as proposed by Will Page. Well I don’t really do this kind of reporting often as I rely on other sites interpretation of the economic papers and I seldom read them but no this time armed with a handy print out I sat down with pen in hand and proceeded to read the article in depth these are my observations and they may be a little narky and I make no apologies for that as after all this is only my opinion.

I think the basic premise is that all the other distribution models were good because they had gate keepers that charged for use and that the internet is a godless abomination that needs to be harnessed for the good of the content industries. I don’t think he believes that people are necessarily evil, but the internet in nothing more than a means to thwart previously sound revenue models such as pay TV and that the music industry understands and knows the solution. This is really interesting when he talks about how the government was proposing a levy to fund the upgrading of the internet in Britain something governments around the world including Australia with its national broadband plan are doing and so this had crossed a line. That asking people to pay a levy so that they could access illegal content through faster pipes no this was a bridge too far, faster speeds meant more content, how dare they.  They the content industries had not even dared to speak such heinous words but now the government had well how about a levy on piracy.

The way I saw it’s like he was saying that the content industries had feed us all on a controlled diet of music, TV and films and we were now addicted like junkies, and like junkies we had resorted to theft to get our drug of dependence and that the internet was the syringe feeding us. The thing is nobody knows how much illegal content is being distributed and consumed but “fortunately, the rights holder industry is not alone in this area. One of Ofcom’s duties under the new Digital Economy Act is to provide “…an assessment of the current level of subscribers’ use of internet access services to infringe copyright.” Based on their most recent communications this assessment will involve existing data, consumer research, and new databased on network traffic characteristics”.

So then the article details that yes indeed it is time to try the carrot approach as it is clear that hitting people with a stick is not working and clearly does not endear your customers. But its at this point in  the article that I get rather confused when  he says they have dropped the stick but are now “nudging” users to do the right thing, but really it is the nasty ISP’s that are allowing this to happen so the carrot should be a charge levied against the ISP’s when you or I are naughty and download illegal content, and they will know this because Ofcom has told them how naughty we have been.

There is a bit of discussion of which type of carrot to use in this process either a levy or a licence, the licence is problematic as it seems to bestow too many rights so a levy is a better choice.  The other interesting thing that this article attempts to take a swipe at BP and their gulf coast issues with a parable about the evil petroleum company that leaked its oil all over the fisheries of some poor fishermen and how that they should be compensated, I failed to see the relevance but topical none the less. The bottom line that I got from this article is that this is not about licensing piracy at all really is about getting ISP’s to stop it at its doors before the user can access it at all. The model that the levy charged to ISP’s would fluctuate with the levels of piracy detected so if you reduce piracy on your pipes you reduce the levy. This is just shifting the compliance of copyright to ISP’s , this is not going to fly and already ISP’s in Britain have called this for what it is, just another way to lock up content and to try and harness the internet.

I really enjoyed the paper the concepts covered are sound and although I disagree with the findings the evidence presented could easily be pervasive in augments to licence piracy as I had envisioned it. What do you think?

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