Music Industry Proposes a Piracy Surcharge on ISPs

[MADcHATTER]

By Frank Rose | Wired.com

 

Having failed to stop piracy by suing internet users, the music industry is for the first time seriously considering a file sharing surcharge that internet service providers would collect from users.

 

In recent months, some of the major labels have warmed to a pitch by Jim Griffin, one of the idea's chief proponents, to seek an extra fee on broadband connections and to use the money to compensate rights holders for music that's shared online. Griffin, who consults on digital strategy for three of the four majors, will argue his case at what promises to be a heated.

 

"It's monetizing the anarchy," says Peter Jenner, head of the International Music Manager's Forum, who plans to join Griffin on the panel.

 

Griffin's idea is to collect a fee from internet service providers -- something like $5 per user per month -- and put it into a pool that would be used to compensate songwriters, performers, publishers and music labels. A collecting agency would divvy up the money according to artists' popularity on P2P sites, just as ASCAP and BMI pay songwriters for broadcasts and live performances of their work.

 

The idea is controversial but -- as Griffin and Jenner point out -- hardly without precedent. The concept of collecting a fee for unauthorized use of music was developed in France in 1851 as a way of reimbursing composers whose work was being performed without their permission in cafes and the like.

 

The practice spread to the United States in 1914 and currently applies to radio airplay and webcasts in addition to live performances. In a 2004 white paper, the Electronic Frontier Foundation called for it to be applied to file sharing, but the Recording Industry Association of America immediately dismissed the proposal.

 

Things are different now. "The labels are beginning to like the idea of an access-to-music charge," says Jenner, who once managed Pink Floyd and the Clash, "because they're increasingly aware that their current model is broken." U.S. music sales, which peaked in 1999 at nearly $15 billion, dropped to $11.5 billion in 2006. Last year's figures are still being tallied, but with CD sales cratering and online sales overwhelmingly dominated by singles, the only question is how far they'll fall.

 

Meanwhile, the industry's antipiracy efforts appear more and more futile. Digital rights management, long touted as a solution, has been all but abandoned. And though the RIAA is said to have threatened or taken action against some 20,000 suspected file sharers, the market-research firm NPD Group reports that nearly 20 percent of U.S. internet users downloaded music illegally last year. The score to date: 0.02 million alleged P2P users down, 40.98 million to go.

 

At the music industry trade show MIDEM last year, John Kennedy, the head of IFPI -- the RIAA's international affiliate organization -- offered modest support for the kind of licensing fee Griffin and Jenner propose. "It's a model worth looking at," he said at a press conference. "If the ISPs want to come to us and look for a blanket license for an amount per month, let's engage in that discussion."

 

The tone at the January 2008 MIDEM in Cannes, France, was more combative. Longtime U2 manager Paul McGuinness said in a widely reported speech that it was time to hold ISPs responsible for the file sharing deluge. McGuinness wants network operators to cut off those the industry deems offenders -- an approach France's Sarkozy government is already pushing in that country. "If ISPs do not cooperate voluntarily," McGuinness declared, "there will need to be legislation to force them to cooperate," McGuinness said.

 

IMOH: Do not expect this to resolve the Royalty Issue. The labels and the RIAA are just too damn greedy to let us off the hook this easy! They'll claim it for the file sharing but still expect us to pay outrageous royalties. Watch and SEE!!!

[MADcHATTER]

By Frank Rose | Wired.com

 

Having failed to stop piracy by suing internet users, the music industry is for the first time seriously considering a file sharing surcharge that internet service providers would collect from users.

 

In recent months, some of the major labels have warmed to a pitch by Jim Griffin, one of the idea's chief proponents, to seek an extra fee on broadband connections and to use the money to compensate rights holders for music that's shared online. Griffin, who consults on digital strategy for three of the four majors, will argue his case at what promises to be a heated.

 

"It's monetizing the anarchy," says Peter Jenner, head of the International Music Manager's Forum, who plans to join Griffin on the panel.

 

Griffin's idea is to collect a fee from internet service providers -- something like $5 per user per month -- and put it into a pool that would be used to compensate songwriters, performers, publishers and music labels. A collecting agency would divvy up the money according to artists' popularity on P2P sites, just as ASCAP and BMI pay songwriters for broadcasts and live performances of their work.

 

The idea is controversial but -- as Griffin and Jenner point out -- hardly without precedent. The concept of collecting a fee for unauthorized use of music was developed in France in 1851 as a way of reimbursing composers whose work was being performed without their permission in cafes and the like.

 

The practice spread to the United States in 1914 and currently applies to radio airplay and webcasts in addition to live performances. In a 2004 white paper, the Electronic Frontier Foundation called for it to be applied to file sharing, but the Recording Industry Association of America immediately dismissed the proposal.

 

Things are different now. "The labels are beginning to like the idea of an access-to-music charge," says Jenner, who once managed Pink Floyd and the Clash, "because they're increasingly aware that their current model is broken." U.S. music sales, which peaked in 1999 at nearly $15 billion, dropped to $11.5 billion in 2006. Last year's figures are still being tallied, but with CD sales cratering and online sales overwhelmingly dominated by singles, the only question is how far they'll fall.

 

Meanwhile, the industry's antipiracy efforts appear more and more futile. Digital rights management, long touted as a solution, has been all but abandoned. And though the RIAA is said to have threatened or taken action against some 20,000 suspected file sharers, the market-research firm NPD Group reports that nearly 20 percent of U.S. internet users downloaded music illegally last year. The score to date: 0.02 million alleged P2P users down, 40.98 million to go.

 

At the music industry trade show MIDEM last year, John Kennedy, the head of IFPI -- the RIAA's international affiliate organization -- offered modest support for the kind of licensing fee Griffin and Jenner propose. "It's a model worth looking at," he said at a press conference. "If the ISPs want to come to us and look for a blanket license for an amount per month, let's engage in that discussion."

 

The tone at the January 2008 MIDEM in Cannes, France, was more combative. Longtime U2 manager Paul McGuinness said in a widely reported speech that it was time to hold ISPs responsible for the file sharing deluge. McGuinness wants network operators to cut off those the industry deems offenders -- an approach France's Sarkozy government is already pushing in that country. "If ISPs do not cooperate voluntarily," McGuinness declared, "there will need to be legislation to force them to cooperate," McGuinness said.

 

IMOH: Do not expect this to resolve the Royalty Issue. The labels and the RIAA are just too damn greedy to let us off the hook this easy! They'll claim it for the file sharing but still expect us to pay outrageous royalties. Watch and SEE!!!

[James]

Thanks for the read

[James]

Thanks for the read