International Music Managers’ Forum secretary general Peter Jenner’s latest post adds fuel to the ISP levy debate currently burning in the UK; and on midemnetblog.com, with readers such as Guillaume Laurent pointing out in response to Jenner’s last post that the same idea was “happily shot down back in 2006” in France. Nothing to discourage Jenner, however, as you’ll exclusively discover here!
There have been two main objections to the idea of a negotiated Access to Music Charge, agreed between the music industry and the ISPs on a company by company basis that I have come across.
The first objection is that it would mean that the current recorded music business would be immediately destroyed, because no-one would pay for music when they can get it for free. This is an argument that has some initial attraction, but the fact is that music has been obtainable for free for some years, and although there has been a potential decline it is arguable that the real damage done to the industry has been through de-bundling (replacing the €15 CD with the 99 cent single iTunes track), and by giving ridiculous discounts to the ‘big box’ retailers. Radiohead’s number one on Limewire, the regular charts and iTunes all provides some serious support to the idea that people’s purchase behaviour is driven as much by inertia, habit and respect for the artists’ right to be paid, as by ‘rational economic decision making’.
The second major objection to the charge from the industry is that the ISPs would never pay out for the use of music online. The nearer I have got to ISP people, the more I have become convinced that that is possibly not true. Obviously no-one wants to pay for something they can get for free, but at the same time the ISPs realise they have a problem. The flat rate charge is under pressure from the increasing use of services that are bandwidth hungry, whether that is the BBC iPlayer, Bit Torrent, or other legal or non-legal file sharing services that clutter up the net with complex traffic and huge amounts of bandwidth. The free riders are wrecking the ISPs’ economics.
ISPs have to get into traffic shaping and active bandwidth management through tiered offerings to the consumer in order to build their businesses, and to pay for the capital investment required to deliver both faster service and greater range of content. But this requires running into problems with their legal position of being just neutral pipes, which underlies their position of not being responsible for the unauthorised use of copyright material. This position is already under legal attack, and politically it is not possible for the governments of Europe to stand by and watch the systematic undermining of the notion of copyright, as this lies at the very heart of the capitalist system, especially now Europe is becoming such a weak force in the mass production of everyday goods. The problem is not the underlying idea of paying for the use of creative material, but the manifestation of it through attempts to control and charge for the process of copying. We need to find new ways to fund rewarding creativity and investment in that creativity, rather than trying to control the uncontrollable activity of copying in the digital environment.
Tiered and shaped traffic opens the way to raise charges for different broadband tiers becoming increasingly expensive as more and more content is made available in more and more user-friendly ways, built around navigation and personalisation. But the content industries, along with government and the service providers, are going to need to
develop new ways of ensuring that this does not undermine the public interest in some sort of net neutrality, so that communications online are as free and confidential as they are in any other sphere of activity. In short we will need not only a new way of paying for the content which respects and flows with the way people actually use the net, but which also respects privacy and confidentiality.
This means that new ways of finding out what music is being accessed on the web, but not where it comes from and where it is going, except in a generalised way, i.e. it is fine to know that a piece of music is being accessed in London, but not that it is being accessed by any particular person. This means that granular payments become icreasingly difficult to utilise, except where the customer is happy for his usage habits to
be available (of course we do this when we buy goods or services with a cheque or credit card, or use loyalty cards).
This approach opens the way not just for the ISPs to bring in generalised services but also to get into the provision of personalized services, using recommendation, programming, navigation and discovery. These and other value added services will permit the ISPs to both a ‘mains water service’ and a bottled water service. This is good news for them and good news for the music industry.