[Peter Suderman]
Over at my blog group-home, Reihan wonders if maybe, just maybe, a "music tax" might be a good idea. He's responding to an idea that popped up in a recent Portfolio piece. Basically, the labels, or at least Warner music, want to see an additional $5 tacked onto everyone's ISP bill. They'd divide the spoils, and ISP subscribers would be able binge on file sharing without fear of legal reprisal.
I actually think this sounds great, at least provided that it's voluntary—in other words, that it's not really a tax. The article quotes David Barrett, who manages peer-to-peer networks for web hosting colossus Akamai, as saying that, no matter what the label reps say, "it's a tax."
"It'll be a government-approved cartel that collects money from virtually everyone—often without their knowledge—and failure to pay their tax will ultimately result in people with guns coming to your door."
Look, I'm usually the first person to smell hidden taxes, but the Warner rep advocating the plan explicitly denies any desire to have the government involved, and as long as that's true, this seems to be a pretty good way to solve the problem of illegal file sharing. My suspicion is that the $5 price point is probably too low unless it really is a tax, but I don't see why a $10 or even $20 fee wouldn't work. Think of it in comparison to other unlimited-media servives. The average monthly cable TV bill is almost $50, and all-you-can-watch Netflix plans run $14-$24 a month. How many people who buy music even a few times a year wouldn't spend the price of a CD a month (or less) in order to have essentially unlimited access to music?
So while I sympathize with Barrett and with folks like Michael Arrington who worry that this will quickly result in compulsory licensing, I see no reason why this can't or shouldn't work on a voluntary basis..
$5 a month for the right to use other people to get files sounds about right. Unless they plan on making itunes free for everyone...
All depends on theri methods for enforcement. Why would we believe that the music industry wouldn't implement a draconian monitoring regime through their new partners, the ISPs? And without telling anyone, of course. Never forget what Sony did.
Just like the surcharges on all the blank tape cassettes and VHS tapes the music and movie industry demanded. And just because the music and movie industry would demand a $5 surcharge (or whatever the price, voluntary or not) on ISPs doesn't mean ISP bills all will jump $5 each long into the future; competition will continue to drive prices.
It's not a bad idea, at any rate, and a model that may be the only answer to monetizing their downloadable content.
Sure, it sounds reasonable... IF you download music...IF you're a Music Label... IF....
I have never downloaded a music file and most likely never will, so why should I pay to allow someone ELSE to do so ? This is not like paying property tax so other people's kid can go to school even when I don't have kids of my own. There is no "public good" involved here... only a failed business model trying to revive the dead Golden Goose .
I don't understand -- my $5 is divided up and distributed how? And entitles me to immunity against infringement claims from who?
I just heard a Scott Kirby song on Live365 that I liked. Would this program allow me to BitTorrent it legally? How would Kirby get paid?
A voluntary fee can easily be done right now. Why don't they just increase their prices a little and stop suing people, so that they pull in an additional $60 per person per year? It's the same as a voluntary fee, since people can pay or not as they want.
My guess is that the "voluntary" part is not part of the deal, given that they could do this right now via a price increase.
This is a terrible *terrible* idea. Not only would the artists likely not see more than 1 percent of this money in total, but it would end up only going to the Major label artists and members of the RIAA. I'm thinking of the indie labels out there: Cleopatra, Metropolis, Relapse, Archenemy, Century Media just to name a few off the top of my head. whose artists wouldn't see a cent of this tax, and yet how would a lay person know if the artist had been compensated for their work?
I'll happily pay for an artists work, and I'll be more than happy to purchase their CDs and go to their concerts, but I'm not about to purchase anything from the Major Labels who continue to use lawsuits to harass and extort people who had not downloaded music and had not infringed in any way shape or form.
(and if you're going to make blog posts without reading slashdot, for shame! :)
(the slashdot article is about the lastest in the Tanya Andersen lawsuit.)
http://yro.slashdot.org/article.pl?sid=08/03/14/158246
(This is really long, but I had been meaning to write out my thoughts about this anyway)
Why I have a problem with this:
I make music on my PC. Currently I don't release any of it. But if I do, and if people download it illegally, will I get any compensation from this? Of course not.
What about if I go download tracks from Myspace from some unsigned band? Will they get any compensation from this? I have to assume not.
What if most of my illegal downloading is of (let's say) Japanese bands... does the compensation get routed back to those bands?
In fact, how much does the compensation get routed back to artists generally? (I know that the numbers for the file sharing lawsuits thus far have been discouraging, in terms of money filtering back to artists)
What about once far more bands start going down the road of Radiohead and Nine Inch Nails, and start taking control of their own distribution... will this $5 fee be revoked once the labels are connected to less and less downloaded music? Good luck on that....
At least from my perspective, the elephant in the room concerning the music industry as it now exists is that music is getting vastly easier to make and vastly easier to distribute (the first owing to more powerful computers, wildly improved commodity software, and larger repositories of free samples and instruments, and the latter owing to the internet, of course). People love making music. They will do it for free. It will only get easier from here. And if they know they can't sell it, they have little financial incentive not to just release it, where at least they might get compensated by attention.
At least from my perspective, the main game the recording industry is engaged in right now is controlling the conversation, skipping questions about their role in the ecosystem of music and instead demanding that the conversation be about piracy.
I think in many ways the situation is highly analogous to the situation of Windows and Linux. For years, Microsoft has griped about losses from piracy, and trotted out magnificent graphs and charts and dollar figures with their weeping. But the moment they try too hard to reign in piracy, they discover that they push (at least some) people away into the waiting arms of Linux. I would rather use Windows than Linux because Microsoft has a monopoly on my personal expertise with existing Windows programs that I've used a lot. But if they push too hard, I'll reach the point where it's worth it for me to transition to using free software that I haven't yet gained expertise in, or even to help develop and improve that free software. And once I've made that jump, they've almost certainly lost me as a customer for life. Thus, they walk an incredibly fine line. They might, on the books, have various legal rights concerning retribution against piracy - but in the real world, they have to engage in certain give-and-take to maintain me (and others) as customers. And Microsoft has publicly admitted as much (releasing incredibly cheap versions of software in countries with high piracy rates, admitting that the earlier success of Windows was largely due to entrenchment via piracy, releasing free versions of widely pirated software such as Visual Studio to make sure they build mind share...)
My hunch, and I could be wrong, is that music labels are largely in the same position as Microsoft, but they haven't owned up to it. The music industry largely has a monopoly on the music that I remember from, say, high school. They own a weird part of my cultural heritage. If I want to acquire music, there's a good chance that I will acquire stuff they have rights to, because that's the stuff I already know. The fact that current music piracy is so profoundly easy and difficult to stop means that I don't really have any incentive not to go after that particular music. But, realistically, that music honestly isn't specifically better than a bunch of unsigned and freely available music on the net. It's just music that I happen to know. It's stuff I'm likely to default to. As long as piracy is incredibly easy, that's where I'll turn. If, however, the recording industry became vastly better at stopping that sort of casual piracy, I would suddenly have incentive to look around and see what else is out there that is freely available. Other people would too. Other websites, and Pandora equivalents, would too.
Far more than music, the music industry is primarily engaged in selling its own legitimacy and specialness. It's (of course) classic show business.
My own concern is that, while they still have an illusion of legitimacy, they'll be able to get ill-founded laws or regulations on the books that impede whatever happens next. I would say this $5 thing is such a thing.
This is the worst idea in the world and this silliness must be ended.
1. This is not a tax in that the gov't will collect the money; it is proposed to be a legal requirement that all internet services charge $x / user / month for music services. So you will pay $x more for your DSL, plus $x more for your phone data plan, etc. You will not be able to obtain internet service without this feature.
2. The money will be paid by the ISP's to the music labels. By the one estimate I read this would double the revenues of the labels; i.e., in aggregate, everyone in the US will be forced to spend twice as much on music as they do now.
3. So, the labels' revenues are doubled, and they are no longer contingent on such bothersome things as actually producing something people want to buy for the price. This will increase the market value of the labels approx 10x; getting this bill passed would make the labels a better investment than buying Google at the IPO and selling at the peak.
4. Does it matter if the labels provide an easy-to-use means of downloading the music? Are they obligated to spend any fraction of the money developing new talent? Do they care at all if the music is any good? Are they prohibited from finding new ways to charge you more for the music you want? No, No, No and No. They get the same amount of money regardless, and only a change in legislation can hurt them.
5. OK, so what does this mean for music? I'd guess people will download a lot more songs. This means:
(a) More market share to old music from the back catalogs.
(b) More random selections and fad songs. Think YouTube vs. network TV for the range and quality of content.
(c) Both of which imply less market share for big name artists. Goodbye Mariah Carey, hello Dr. Demento.
All of this is great news for the labels. Back catalog sales are a complete win for the labels, as they have zero cost to produce this. The big names have the most bargaining power, so the labels' margins are smallest there.
Right now, the labels' existence is in doubt as musicians find new ways to find audiences and make money. This legislation would grant the labels permanent monopolies on music sales. They will have no incentive to develop new talent, develop new technologies for distributing music, or share the revenue fairly with artists.
I can think of no serious proposal that would be worse for musicians and their audiences.
Shockingly this is not a totally lame idea, in fact they do something similar in Britain with analog stuff or at least used to.
And again, it would be best if it were voluntary as in, pay the tax (call it a downloading tax I don't care about nomenclature) and file share. You can still file share if you don't pay, but then the RIAA can come after you.
Of course they'd probably focus on uploaders then and get free money. It's tough to see how it would game out.
Re some of the things in the comments:
1. This has been to some extent tried and failed on a voluntary basis. The labels do not want a voluntary system as they see this as a way to cut the costs for the people that upload the songs for file-sharers, and it requires the labels to actually innovate a better way for people to access the music. They want to have a monopoly on toll-collection.
2. This isn't optional, in terms of you being able to access the internet without paying the fee. They would need some means to stop public wifi or other access, unless it would be limited to users with valid music tax stamps.
3. Since all ISP's will have to levy the tax, none will need to compete by absorbing it.
4. The distribution of the money to artists will probably be pro rata based on the number of downloads flowing through the labels' system. This means they truly do not care what you download, how much you download or whether you like it. They are just divvying up a pool of money, and their only motivation is to minimize the expenses they incur in providing the service. No compensation would go in respect of music obtained from other sources. As you can imagine, this really does not promote a good outcome.
Personally, I don't listen to a lot of music, and the music I do listen to, I already have bought once on CD.
Why should I pay a monthly fee for something I don't want or need?
I read the linked story, and it never, not once, states that the fee is voluntary. If it is not voluntary, then it is a tax, even if all the revenue goes to private parties. If this is true, then it is an appalling idea.
Will Deaf people have to pay this "tax"?
No, I'm serious. I don't think it's one bit fair. I don't download music, never have, never would - why should I ante up $5 so that the record labels aren't "hurt further" by people who choose to do something the record labels have deemed unscrupulous (file sharing)?
It seems to me that it's once again a case of the people who followed the rules in the past paying for those who didn't.
And I don't care if they put in some paperwork-heavy option allowing people to "reclaim" that $5 a month; it's still not fair.
This could open the door to cable companies levying additional fees on all their subscribers to "make up" for those who "steal" cable. And for stores adding an extra "shoplifting reclamation tax" on products. Yes, I know, they already DO by raising their prices, but this would justify them doing it more and giving it some cutesy name to let those of us who are being screwed know that we're "helping" them out and they really, really appreciate it.
Shorter Peter Suderman: we could solve the crisis in the music industry if people would just voluntarily send the major labels a lot of money.
I don't really listen to music. Even in the car, I listen to sports or talk. I have never purchased a music CD (other than "childrens'" songs and holiday songs for my kids), and I have never downloaded a song on line. I would RESENT having to pay this tax, and being allowed to make free downloads would in no way compensate or assuage me.
I nominate Marc A Cohen for Quintessential Libertarian of All Time.
Ok to the people who dont wish to pay this fee why do the isps and industrys make the tax voluntary to people who like music and want all they can eat if you say you dont dload then i say the isp should be able to watch your usage to be sure you or a member of your family are not dloading a quick album or 2 which isps can already tell who dloaders are basically but if your caught not paying this and dloading music then court yah go i still say this model was adopted in the uk as way of the tv license and is keeping tv running decently the music industry suck suing kids and single moms is evil but if griffins plan was given a chance and the suits fell quiet this would benifit all to say you dont dload doesnt meen that grand daughter or son not gonna use you connection to do so at some point we all have to be realistic artists need to be paid and nutured the music industry is destroying music i say the 5 dollor charge is suffiecient as long as it was not allowed to creep up ever