Rick Roccobono and Ian Penman

Rick {Riccobono [www.newmedialaw.biz/pages/rick-riccobono.php]} and I [www.newmedialaw.biz/pages/ian-penman.php] have been advising various governments on this issue.

As yet, however, our advice has not been fully followed (although we believe that it eventually will have to be).

In a nutshell: a licensed service will not work. Nor will suing the users and/or closing down their connections (although as copyright lawyers, our business will multiply logarithmically – as more and more people question whether such action was legitimate – and rights owners/ISPs are force to prove that the user’s action was in fact an infringement of copyright!

In our view, the evidence shows that the public will not adopt a music subscription service with the type of monthly charge being considered by Virgin (for instance). Also, the ISP’s cannot be counted on to police the network and/or administer music distribution even if they could maintain safe harbour status (something that any government would have to guarantee before begin discussions could even begin). Having said that, a government is critical in the process, as they must direct the ISPs to cooperate. To date, whilst some ISPs have paid “lip service” to toeing the line – in respect of copyright infringement – none have as yet actually adopted any policy that provides a direct financial benefit to copyright owners. Don’t forget that in the UK, studies have shown that up to 80% of total internet traffic at any one moment is comprised of people illegally downloading music! Yet do you suppose that the ISPs have offered to pay through any element of their income from this use? Of course not!

Our advice has been to tackle this by way of a levy per connection without regard to actual music usage (in effect a charge for broadband use). No engagement with the rights owners would be commenced unless and until a substantial pool of money had been set aside from a levy. At that point and again without regard to actual music consumption, the major rights owners would be invited to create a mechanism by which the money could be distributed, maybe via some combination of factors including the various market share numbers. The levy and its distribution would have no effect on already approved music services like iTunes and the rights owners could still address piracy in any way they see fit.

The advice we have provided addresses multiple topics including wholesale pricing models in a licensed service, the character of the levy and the viability of garnering the cooperation of the rights owners (publishers and labels at the same table from the start) to participate in the allocation of an incremental income stream that has no connection to the current approved and licensed business models.

However, none of this is happening right now. However if there is some level of support for this concept from one or more major music companies it may encourage the relevant governments to move forward with the initiative.

Frankly, at present, we cannot see any other solution having any chance of success.

Leave a Reply