Piracy PayBack

Stop Piracy by Bundling Media with Web Access – Can “Music Tax” Work?

June 30, 2009 – 3:50 am

Last week, Jeremie Zimmerman of La Quadrature du Net appeared in Business Week saying that “File-sharing is unstoppable anyway. The real question will be about how to use it to find new ways of funding creation. All conservative and repressive measures are bound to fail.”

There was one arguably non-conservative idea on piracy that received a shredding a year or so ago when Trent Reznor repeated the concept originally touted by Pink Floyd’s Peter Jenner: piracy is unstoppable so content is best monetized by bundling it with internet access.

It received a cold response by industry commentators such as TechCrunch largely on the dated basis that it will kill innovation as there is not way to gauge what and how much is being downloaded.

In the age of the highly measurable and thus accountable internet, this argument holds no water. It would be relatively trivial to know how often a particular track is being downloaded and apportion the owners of the content with a commensurate proportion of the revenue.

We agree with the likes of David Ortez that this is achievable. We’d even go further and apply it beyond music piracy to movies, television, software and games.

How It Might Work

We see it working by having artists and publishers competing for a “slice of the pie” that is measured by the number of times their material is downloaded. The more your work is accessed, the greater your slice of the pie. The overall size of this pie would be reflective of the amount of usage your material receives.

This usage can be gauged either by working with the ISPs to track traffic or otherwise developing a reporting standard that could be applied across any digital distribution channel, regardless as to whether or not it is YouTube, Seeqpod, Limewire, PirateBay, iTunes etc. These channels too would receive a slice of the revenue based on the number of downloads from their sites (albeit naturally less than the owners).

This preserves market forces and thus destroys the notion that this concept would stifle innovation.

Sure there are challenges in quantifying the size of the digital download pie, ensuring that a critical mass of ISPs are involved and managing the distribution of revenue. Furthermore, there may need to be measures such as well constructed opt-in/out subscription models to ensure that this is not deemed to be predatory pricing.

However, these challenges are by no means insurmountable.

Once achieved, the benefits for all are significant:

• Artists can focus on creating great and innovative content and being fairly rewarded for their efforts
• Publishers/labels can focus on marketing this content through whatever channels without needing to worry about distribution or piracy (or attacking their users with court orders) while too being compensated for the benefit they provide to this value chain. It is also far superior to the infinitely daft Radio Music Tax
• Music properties can earn revenue and openly compete for users based on functions and features rather than worrying about how the labels may react to these innovations
  Illegitimate non-digital piracy channels such as the markets for copied CDs and DVDs would dry up
• Users such as you and me can freely access a dazzling array of content at an extremely low price-point without having to worry about DRM or breaking any laws.

Well, what are we waiting for? Maybe it is indeed time as per Jenner’s suggestion to “lock everyone in a room – the music industry, the unions, the performers, the record companies, the publishers, the ISPs – and tell them you can’t be let out until you sort it all out.” …