RIAA Now Open To 'You Must Be A Criminal' Tax On ISP Fees

from the not-the-answer dept

This certainly isn’t the first time it’s been proposed, but it appears that the RIAA is potentially warming up to the idea of a “music surcharge” that would have ISPs pay $5/month in order to allow anyone to share music online. Just a month ago, we were discussing why this is a bad idea. First, it’s effectively treating everyone as a criminal, and forcing those who don’t download or share music to subsidize everyone who does. Second, and much more importantly, it’s not necessary. If there’s anything that the past five years (and the past year especially) has taught us, it’s that there are many different ways for musicians to make money without requiring the government to step in and set up a business model for them. In other words, there’s no compelling need for such a mandated system. Third, once you do this, it opens up additional questions from other industries. Will the government need to set up laws that prop up their business models as well?

Some people are comparing this new RIAA proposal to the one that the EFF proposed four years ago. However, that one was quite different, in that it was a voluntary licensing system, rather than a mandatory one. In that system, anyone who wanted to could voluntarily pay $5/month to have free reign to share and download music. This new proposal would mandate that ISPs pay the fee (meaning that ISPs would quickly pass the costs on to everyone). That’s quite different. It also might be a different story if ISPs voluntarily offered this as a feature for customers — where they would license the music so anyone could freely share it. That’s a case where the ISP would effectively be paying for the creation of music and using its free nature as a promotional good for its service. However, that rationale goes away if it’s mandatory. So, while it’s nice that the RIAA has woken up (about a decade too late) to the idea that new business models are needed, this proposal isn’t a very good idea.

Filed Under: , , , , ,
Companies: riaa

Rate this comment as insightful
Rate this comment as funny
You have rated this comment as insightful
You have rated this comment as funny
Flag this comment as abusive/trolling/spam
You have flagged this comment
The first word has already been claimed
The last word has already been claimed
Insightful Lightbulb icon Funny Laughing icon Abusive/trolling/spam Flag icon Insightful badge Lightbulb icon Funny badge Laughing icon Comments icon

Comments on “RIAA Now Open To 'You Must Be A Criminal' Tax On ISP Fees”

Subscribe: RSS Leave a comment
MadJo (profile) says:

You pay a similar tax in regular stores

shoplifters causes prices in stores to increase.

But indeed, copyright infringement is not theft. 🙂 The RIAA should just see these shared music tracks as promotion for the bands of their members.

In the past, I have thought that this would be a good idea, but I’m not so sure any more. What you are saying makes perfect sense to me. A voluntary system sounds indeed better.

SteveD says:

Re: You pay a similar tax in regular stores

That’s not a tax, it’s just an added distribution cost no different from lost CDs being lost or damaged before they reach the store.

There can be any number of distribution issues that can drive up the cost to the customer, but those sorts of costs revolve around recovering costs from wasted production or investment. It comes back to the differences between normal property and intellectual property; when you steal physical property from a store they loose money because they can’t sell that property to someone else. When you steal intellectual property you’re instead denying them a potential sale, which is different.

A better comparison might be the VCR in France, which (I think) had an extra tax on the cassettes to compensate production companies for home-recording.

But it seems that the worlds recording industry seems intent on forcing ISPs to regulate the internet in some manner. How will Governments respond with powerful corporate lobbies on one side and public liberty on the other?

The IP war looms…

MadJo (profile) says:

Re: Re: You pay a similar tax in regular stores

I was talking about actual shoplifting, shops hike prices for that. But that’s getting beside the point now.

Here in many European countries we pay an extra levy on blank media. On CDs, cassettes, DVDs, video tapes, MiniDV tapes etc. On all of those we pay a levy, and for us downloading is legal (though BREIN in NL does try to make it seem not to be that way). It’s the uploading that’s illegal here.

Jean says:

Re: Re: You pay a similar tax in regular stores

About VCR’s, I think you must be referring to the measure taken by the socialists by 1981, when they decided to reroute imported VCR’s to Poitiers, under some administrative pretext, really in order to increase their cost. But that was just industrial protectionnism, it didn’t have much to do with intellectual “property”.

korrupt9187 says:

Re: You pay a similar tax in regular stores

I agree completely with your first statement, the record companies are finding new ways to make people pay for stealing music. The whole idea of thinking that P2P music sharing is okay and legitimate is ridiculous, it is common thievery, and you are an ignorant, conceited fool to try and convince yourself otherwise. Quit complaining when the record companies call you on it, and come up with ways to make up for their lost revenue.

David Griffin (profile) says:

Re: You pay a similar tax in regular stores

A better analogy would be “you pay more in a newsagent because of all the people who come in and read the newspapers then walk out without buying them”.

Except I don’t think it would be true.

Shoplifting costs real money – actual goods go missing (though the cost should be evaluated at replacent cost, not at selling price, which in the case of illegal downloads comes down to just the bit the artist would have got since no actual CD manuf or distribution were incurred)

Illegal downloading only costs anyone a cent if you can prove that a real paid for music sale would have happened otherwise.

It is a bit like a motorist accusing me of queue jumping when I cycle inside him in the rush hour. It’s just sour grapes, because I didn’t actually take his place or force him to arrive in work any later than he would have done.

Twinrova says:

Hold on just a second...

If the MPAA gets on board with this, the idea may not be that bad, actually. Of course, the objections would come from pay-per-song download sites, like Apple’s iTunes.

Correct me if I’m wrong here, but what I’m seeing is “Pay $5/mo and download as many songs (movies?) as you’d like!” as opposed to “I’m suing your children for file sharing” and that’s something to really think about.

IF (big one here) these funds go to the artists as RIAA says it does, I’m actually open to having my cable bill go up $5/mo.

Because the next step would be to download a P2P program and start hogging up tons of songs I’ve been wanting.

It sure as hell beats paying $0.99 per song!!! And EVERY consumer would see this as an advantage and wouldn’t mind a $5 charge (especially if it gets people like me to download when we usually don’t).

But I’ve a feeling this isn’t what RIAA’s intentions are. Given how idiotic these people are, it seems the $5/mo will be in addition to charges at online stores and the lawsuits will continue.

I fully understand that artists need to be compensated for their works but I absolutely abhor the music industry for screwing up the “math” for these artists.

Back in the CD days, it was believed that artists received less than 20% per CD sale. I don’t believe the 80% should have gone to the industry simply because they need to spend on advertising and push crap artists to the radio.

I’ve found more artists I enjoy online that I have on the radio these days. Thanks to many free mp3 websites, it’s amazing the music people do make.

Which brings me to one more point: How in the world can the music industry try to sustain EVERY SINGLE ARTIST out there? It can’t! Especially with the prices they’re charging consumers for songs!

I guess it’s more important to support a drunk, child-ignoring, crotch-shot showing, SUV beating singer than it is to support a group no one’s ever heard of because they lack radio play.


Astrid says:

The biggest problem with this idiotic plan is that once the government steps in, they never leave, and it would take the strong arm of government to get this $5 a head booty call tax initiated on behalf of the RIAA.

Remember that when the government comes to visit, they never stay in a hotel, offer to chip in for gas or bother to pay for any of those porno movies they downloaded to your DVR. And forget about the international phone calls they rang up in your name, on your calling card. IMHO the RIAA is slurping up slop out of the same pig trough as any government agency with the ability to order and collect taxes and fees. I say it’s time for another tea party in Boston.

dag says:


When Napster came out, I thought it was a really cool thing. I was at a start-up company at the time. The big attraction wasn’t that you could get free music. It was that you could get any song you could think of. We would come up with all kinds of songs, trying to find one that would not be there. The Angel’s second album, ‘Down in the Boondocks’, Andy Griffiths football routine. I use to buy 3-10 cd’s a check, but quit that when they forced Napster to go buy buy. I still enjoy music, but I have not downloaded a single song, except one free one from iTunes. I use to go to the library, check out 15 cd’s and take them home and rip them. Now most libraries have wifi, so I take my laptop there a couple times a year, and just rip everything. I do buy used CD’s still. Last xmas, I was given a giftcard to borders, and there was no new books I wanted, so I picked up a ramones DVD and a gene Krupa CD, so I had that little slip too.

Astrid says:

Another point

Third, once you do this, it opens up additional questions from other industries. Will the government need to set up laws that prop up their business models as well?

Your comment reminded me of the travel industry reps who were bawling in front of Congress after 911, demanding the same kind of taxpayer prop-ups and bailouts that the airline industry was asking for.

I remember thinking about how these travel agency bitches wouldn’t give me the time of day to process a $400 airline voucher in the months before 911. It took about 2 minutes for the Delta employee at the airport to print out what I wanted, which was an airline ticket, with an itinerary and flight numbers I’d already chosen online.

All I heard from all the travel nazis I called was whining about how I would have to make an appointment, and it would take a couple of hours, and I’d have to pay a service fee of at least $50. Yeah. Asta la vista, unnecessary travel agents. You’re about as useful as the RIAA and their demand to be subsidized at the tune of $5 a month at the expense of every internet user in America.

Anonymous Coward says:

Hey Grandma – I know you only use your internet to check email and it already costs you more than you can afford to do that – We’re going to charge you more money for downloading music you never have and never will download – I am so damn sick and tired of exec and corps in this world RIPPING EVERYONE OFF! If I see this turd in the street, I’ll land one where it hurts and stuff a $5 bill down his throat – Here, This is your kick in the balls Fee fucktard!

Jeffry Houser (profile) says:

You often make the mistake...

You often make the mistake of confusing the “record industry / RIAA” with “musicians”. Yes, there are plenty of ways for musicians to create a profitable business by giving away music for free. ( One could argue that major label contracts have forced musicians to give away music for free long before the original Napster was conceived ).

However, the recording industry is in the business of making and selling records. They don’t usually get a piece of the band’s concerts, T-shirt, songwriting royalties, or other related merchandise. I’m not surprised they are scared by giving away their only product.

Crosbie Fitch (profile) says:

Beware 'voluntary'

Mike, I’d look closely wherever you’ve seen the term ‘voluntary’ used. This usually means that musicians aren’t forced to have their music licenced this way. It doens’t mean that the poor ISP using punter isn’t forced to cough up the levy/license fee, i.e. in such schemes it’s usually compulsory for all ISPs to apply this levy (otherwise the system ain’t going to fly).

I suggest people pick wisely from the following ways artists can be compensated:
1) Suspension of liberty and natural IP rights to privilege publishers.
2) Taxation or compulsory levy to compensate publishers for free public use.
3) Exchange of art for money from the artist’s audience in a free and fair market (without compulsion or monopolies such as copyright).

The people who really know how to exchange digital works in a free market (software engineers) are way ahead of everyone else. Free as in speech, not as in beer. You want more and better GPL software? Pay for it. Feel free to sell your own improvements. No-one has a monopoly on GPL software.

The idea that suspending the public’s liberty to free cultural exchange was a great way to promote culture is just the sort of unenlightened claptrap people would be persuaded to tolerate 300 years ago when slavery was fashionable.

The alternative of taxing the people for the benefit of poor publishers who’ve realised their monopolies are dissolving before their eyes, is similarly unenlightened and grievously corrupt.

Follow the money. In whose houses do marble floors get laid?

Let audience and artist deal direct, just as in any other equitable trading relationship since time immemorial.

Art for money, money for art.

Hellsvilla (user link) says:

None of it can be accepted

No single industry is going to forgo their “rights” to tax consumers as long as another industry is non-competitively taxing consumers.

For instance: RIAA manages to get ISP’s to pay 5$/month “protection” money for each account. What’s the MPAA getting? Well, here comes another 10$/month charge for that.

Now, that’s just entertainment. What about the BSA? They have even more ridiculous claims of lost profits, so of course, they’ll be wanting 25$/month.

Who’d come after that? Who knows, but someone will. Look at the prospective “entitlement” you’d be setting up for them with such a “protection” scam. It must be made clear that this is not an appropriate direction to head into.

Derek (profile) says:


So, my ISP pays 5/month for me to subsidize music that I have stolen(and that cost is passed to me). Therefore I have subsidized the industry and can steal all I would ever want without having to worry about being caught? Now, I am sure they would not let that fly, but honestly, what are people going to think? If I was a heavy downloader, I would feel “well, i guess i can download heavily, cause I’m paying for it now”.

If the record industry wants to see its profits drop into the single digits (Billions), then it should enact this plan.

Plus, i am no legal expert, but the record label has accepted a subsidy for the stolen music, so case closed. After you accept a subsidy are you going to go back and sue because you say it was not enough? Highly unlikely, you will raise the rates, so $10/month… then $20/month…

Larissa Herda says:

Re: Re:

The $5 a month is actually $3.00 a month AT&T Monitoring fees, $2 a month to the artists.

I wonder if Comcast said NO to the RIAA, and AT&T said YES and if that’s why Comcast is now getting hit with Net Neutrality claims that AT&T was peddling.

It changes the game if you can pay for your filtering system through a universal “music sharing tax”.

Anonymous Coward says:

"license globale"

That sounds like the “license globale”, which was introduced by the French parliament as an amendment in 2006 before being repelled.
In my view, it is far from perfect, exactly for the reasons mentionned by Mike, but it is probably the best that can be done by now, in the current political context.
Think of the whole problem as a political one. Of course, there is a course of action better than any other in theory, but in practice, there is an old business model which simply won’t be able to adapt and remains influent enough to force the government into very stupid things.
In my view, the most important thing right now is that people are not put into jail for illegal downloading (as could legally happen in France), nor even fined absurd sums of money. Not that I support RIAA’s new position, I just see it as an opportunity for compromise.

Haywood says:

How long before value/$ is exceeded

I pay roughly $50 for internet & local phone. I feel it to be worth that, and another $5 wouldn’t change that. Another $25 would. I could go back to free dial-up, it would suck, but I could and would. The alternative would be to cut back elsewhere, it isn’t as though there is a giant pile of money left over at the end of the month that this increase could come from.

Wake up and smell the coffee, comrade says:


I love it. “We’re going to charge you $60.00 a year, (at least initally) for nothing extra than what you have right now.”

If the pizza delivery guy did that, I’d tell them to go fly a kite.

But something leads me to believe that they are having no luck in suing people.. Maybe because the tactics are UNCONSTITUTIONAL?

Hellsvilla (user link) says:

Re: Verizon optimzes P2P, sees 60% speed boost

Wrong. They are not “optimizing” P2P, they are attempting to “gain control” of P2P.

P4P is not needed in any way shape or form. They will give all sorts of false pretenses in an attempt to control this P2P. And once they have this control…

P4P is akin to BitTorrent, except it gives the ISP the ability to become the tracker to all clients. If the ISP is the tracker, then the ISP controls all, including rather “intimate” information about every clients activities.

Overcast says:

If they did – it would more or less be saying, “Ok, we’re getting some money out of this, so download at will”.

But why do they even have to do that? Why don’t they simply offer a service for a monthly fee for unlimited downloads? That model has proven to work – AOL proved it with internet users, cable has long proven that with movies.

Lyons says:

Now lets take it to the next step.

As a creator of media and content, I am an artist whose work is often on a website or is a website itself. This gives be the ability to apply a surcharge to everyone in the nation.
The RIAA is under the notion that no one uses the internet except for music sharing. This is the same thing as my saying my websites and artwork are the only reason people use the internet. I want a $1 surcharge on everyone in the nation. Now i understand that you may not know who i am but that is irrelevant.

This would completely destroy individual rights and make the interests of a single entity the primary beneficiary of public good. This would be similar to passing a law for Bob. Who is Bob? Bob is a guy who wants the tax payers to buy him a pool.

Who are the lawmakers in the pocket of the RIAA?

Welcome to socialism folks.

CVPunk says:

Re: Now lets take it to the next step.

I love when people who know nothing about Socialism try to use it as something horrible. Must be a product of U.S. schooling. Once you have read a book on Socialism written by actual “Socialists”, then make your comments. How would you know what Socialism is when there has never been a truly “Socialist” government?
Anyways… I say just buy music made by independents. Most artists on major labels suck anyways. Support DIY music.
Works for me. Most DIY labels offer free samples in the form of compilation discs or by free sample downloads on their website.

Mike T. says:

Re: Re: Now lets take it to the next step.

Socialism: socio-economic system in which property and the distribution of wealth are subject to control by the community. Community being equatable to bills and laws past by the government which is expect to act in the interests of the community. This control may be either directly, exercised through popular collectives or indirectly, exercised on behalf of the people by the state.
The laws which are often passed in the United States are often passed on the behalf of lobbyists and not the public’s interests at large. So when you accept that posture then it does meet the grounds for socialism, at least in this case.

So the previous commenter would be correct in saying this is socialism, when you approach it in this context. This would lead to a more exaggerated corporate welfare system then the U.S. has already. This is likely a “feeling the waters” for something like this down the road.

Personally, I find it arrogant on the side of the RIAA to assume that music downloading is the only thing that the “inter-web” or the “world wide AOL” are good for. Let us not forget Lars needs his solid-gold Ferarri.

Careysub says:

Business as Usual: RIAA Is Accustomed to Special T

This proposal should be no surprise to anyone. The recording industry has become accustomed to having the government impose special taxes to provide it with revenue under the theory that these taxes compensate it for lost sales through piracy.

See: USC Title 17, 1008 “Royalty Payments”. This is a tax imposed on music CD-Rs, digital audio tapes, stand-alone CD recorders, and digital audio recorders. In 1998 the RIAA tried, but failed, to get special taxes imposed on MP3 players.

Notice that these are taxes on *digital* devices. Analog technology (blank vinyl disks and vinyl recording devices, analog tape and recorders) never had these levies, and yet the industry survived.

At the same time the industry has been obtaining access to tax revenues (originally under the theory that this was a trade-off for more liberal copyright restrictions) it has also been seeking, and getting, increasingly draconian revisions of copyright law.

In all, the recording industry has had some success in using computer technology as a scare tactic to stampede congress into granting it immense new assets at the public’s expense. Despite its great success in this copyright land rush, it is still crying proverty, hoping for even greater gains. Its lots easier than running a successful, adaptable business. The MP3 episode shows though, that these attempts can be resisted.

Darryl says:

Who else should get some "tax" money

$5/m to the RIAA
$5/m to the MPAA
$5/m to NBC for the TV shows you download
$5/m to ABC
$5/m to CBS
$5/m to FOX
$5/m to Microsoft because you pirate Vista
$5/m to Adobe for that extra copy of Photoshop
$5/m to Google for using their search engine.
$5/m to the newspapers because you are killing print.

music non-DLer says:


If they start adding this charge won’t it then give those of us who don’t DL music a reason to start doing so? If I am going to be forced to pay a music download fee I am sure as hell going to start loading up as much music as my drives can hold.

The ISPs are not going to eat that cost they are going to pass it off the the end users.

Chronno S. Trigger says:

Re: Impetus

“I am sure as hell going to start loading up as much music as my drives can hold. “

I was going to say the same exact thing. I don’t presently download now (at least any more) but if this passes than I’m going to see just how much music fits into 255G.

Plus I’ll be telling everyone to download all they want. (even grandma) It’s not like the RIAA will be coming after them any more.

Rick Sarvas (profile) says:

So, where would you get the music from?

My question for this is: download from who? I don’t recall seeing that this would allow you to share music, just download it, so where would you get it from? Would the record companies give up and allow people to download whatever content they want for any source, like P2P? I think not. That would be giving up way too much control. Besides, how could you tell what P2P user paid the tax and who did not? How do you think the music distributors and retailers would react to this?

What I think would happen if this were made a requirement is that the “tax” would allow you to use some poorly designed service offering a limited selection of DRMed music – much like the music service forced on some universities today. In this way if you stop paying the tax, you will be given the option of either “buying” the music you downloaded (rented) or having your music collection stop working. Some deal that is. Besides, even if you were allowed to do an “unlimited” amount of music downloads and they never did expire, I’m sure there would be some sort small print in the service TOS as to just how limited “unlimited” really is.

Sorry, but I just don’t see this ever working in a way that wouldn’t end up screwing the consumer.

Michael Meiser (user link) says:

you're missing the biggest issue of all

The biggest of all with this… well maybe the second behind making everyone including the poor pay for this… thus making internet access that much more inaccessible… the big problem with this is it socializes music and art. That’s just bullsh*t. Who determine’s who and how much an artist should get paid? What about book writers? What about movies… what about short films? What is there value, how do we track it all… why don’t we just invent ourselves a great beuracracy to track it all and dole out the credits… a nice central planning commission… oh yeah.. that works well.

Luckily this insanity would never happen… oh wait… it already has… taxes on recordable media… snowcap… there’s dozens of example of this stupidity and lunacy.

It stifles true innovation and creativity and encourages creativity and innovation in gaming of the system.

Who’ll be the first to start 5 bands and put out a bunch of crap so I can collect their share of the royealties.

Tofu says:

Random Observations

– So, for $5/month everyone with an internet connection will get a worldwide, non-exclusive, unrestricted license to download and distribute any music, in a any form? That sounds like a good deal to me.
– The RIAA is not there to defend the poor and starving artists. It is there to serve the interest of the industry. Industry which, incidentally, is not shy about sucking artists dry, banking on their talent, forcing them abandon their rights, being charged an arm and a leg for studio, etc…
– The Industry knows that the only way to sell a record is to push it down people’s ear. Why they have to pay the radio to do that while they would go after the people who download the songs is beyond me.

jersey says:

RIAA and ISP's

i always thought that a monthly fee of $5 or $10 bucks a month to each customer would be a reasonable price to pay for the right to trade and download music. but now i am not so sure. it looks like the RIAA has another trick up their sleeves and $5 bucks would be the entry level for higher fees once the whole deal became popular. what about movies? even though most people probably don’t want to download movies, the movie industry would want to get their pound of flesh(cash)too as many here have mentioned. eventually, the price of an ISP might become very high. since ISP’s don’t offer ala carte choices, a serious problem with cost to the customers would occur, pricing many many people out. this is definitely a sticky issue.

what it all boils down to is that the RIAA is finally paying for their stupidity and greed after overcharging for their crappy CD’s all of these years. file sharing will get easier with time and the RIAA knows it. they just don’t have enough good artists under contract anymore to keep making music people actually want. what a shame. and the more the RIAA sues the little guys out there, the worse the RIAA looks. the RIAA is probably the most hated organization in the USA and even the judges who get the cases from these leaches hate the RIAA for their evil way of suing the average american.

it will be interesting to see where downloading music files goes, but one thing is certain, file sharing is here to stay and as ISP speeds get faster and faster, it will be harder and harder to track “illegal” downloading. the system will eventually overwhelm the RIAA and they will collapse as the artists leave the record labels and go independant which is what is happening big time right now. too bad, the RIAA will be gone and we won’t even knwo it as they fade into nothingness. asta la vista RIAA. jersey

Glenn.Isaac (user link) says:


Everyday, I work with two organizations: a record label and an Internet start up service. They both think this idea is formed in a bad mold. Me too. I think I may be preaching to the choir here, but this tax is obviously a very bad idea. Raising barriers to trade will not solve problems derived from simple supply/demand economics. As the marginal cost of distributing (note: [unfortunately] not producing!) a product approaches zero, the price of that product will, too. Artificially increasing the price via added tax is inconsiderate and poorly thought out. Peace –

Add Your Comment

Your email address will not be published. Required fields are marked *

Have a Techdirt Account? Sign in now. Want one? Register here

Comment Options:

Make this the or (get credits or sign in to see balance) what's this?

What's this?

Techdirt community members with Techdirt Credits can spotlight a comment as either the "First Word" or "Last Word" on a particular comment thread. Credits can be purchased at the Techdirt Insider Shop »

Follow Techdirt

Techdirt Daily Newsletter

Techdirt Deals
Techdirt Insider Discord
The latest chatter on the Techdirt Insider Discord channel...