Warner Music Pitches Music Tax To Universities: You Pay, We Stop Suing

from the pay-us-not-to-sue dept

Back in March, we noted that Warner Music Group had hired Jim Griffin, a music industry guy who has been pushing the concept of a "blanket license" for file sharing. The idea would be to get various ISPs to simply add an additional fee to everyone's internet access, have that money go into a pool that the recording industry would be responsible for paying out -- and then let people have free reign for file sharing. This is a bad idea for a variety of reasons. It's basically a music tax -- allowing the record industry to be lazy. Someone else gets to go out and collect all this money and hand it over to the industry to distribute (or, actually, not distribute). It effectively sets the business model of the recording industry in stone, and harms better, more innovative business models by inserting the recording industry (and not the musicians) into a role where they don't belong.

We hadn't heard much about this music tax lately, but apparently Griffin has been focused on getting universities to buy into the plan first. An anonymous reader passed on some details, saying that Columbia, Stanford, University of Chicago, University of Washington, MIT, University of Colorado, University of Michigan, Cornell, Penn State, University of California at Berkeley and University of Virginia have expressed interest and talks are under way. A basic presentation that's being given to these universities is below (if you're reading via another site, click through to see it):
There's obviously something appealing about ending the lawsuits and letting people file share freely. But, it's quite problematic to add an effective "tax" when none is necessary. Plenty of other business models, such as those we've outlined here and elsewhere can suffice to fund the creation of music. On top of that, giving the proceeds of this tax to the very industry that has so badly mismanaged musicians for so many years is a travesty -- sort of like bailing out the failed auto industry or banking industry. The presentation says that a nonprofit has been set up to handle the money, claiming that it's "to be clear we intend to operate with good intentions and not profit as a motive," but given the way the industry has acted in the past, that's difficult to take at face value. Also, this isn't really a license. It's a "covenant not to sue" -- meaning that lawsuits could still result.

Of course, while the introduction frames this as a "voluntary" blanket licensing program, the presentation also mentions that they'll need some way to get all ISPs and universities to buy into the plan, or they'll have to work out a way to "avoid massive leakage." So, basically, it's not voluntary at all. It's either join, or get saddled with significant limitations. In other words: all ISPs and universities need to agree to pay a huge tax to the very industry that hasn't been able to adapt, and then trust them to distribute the funds fairly.

Update: Warner Music got in touch and sent us a statement concerning this presentation from Jim Griffin:
"This presentation belongs to someone outside our company and represents that individual's interpretation of issues discussed at meetings held several months ago. It was not made by me or anyone at Warner Music Group. Of course, we are actively engaged with universities and other parties to seek a constructive resolution to a complex issue - how to assure artists appropriate compensation while enabling the widespread dissemination of their work among fans. Therefore, we are undertaking an effort to develop new voluntary business models that seek something other than - and we believe, better than - a litigation-based approach. This is exactly the type of solution that several universities and their associations have been asking for. We recognize that there are many different potential solutions to this issue, and we are determined to continue to think creatively and cooperatively with other parties in order to find the best ones. At this early stage, many ideas may be discussed and discarded, but efforts to prematurely label or criticize the process only hinder achievement of constructive solutions."

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  1. identicon
    tnuocca, 10 Oct 2009 @ 5:58pm

    Taxation

    I spent a far amount of time reading through these comments and I find that there seems to be a lot of dissent because of the fact that this is a tax (parallels were drawn to internet, cable, and electricity as "taxes" as well). My main problem with this solution comes from the difference between these commodities and taxes. Especially in the case of electricity, water, and heating; one pays specifically for their own usage for the most part. It is accepted that if you use more water your bill will be higher than if you were to use no water at all.

    From what I understand, if such a plan were to come into effect, I (who has maybe downloaded/bought three CD's in my life) would be paying the same amount as my friends (some of whom have tens of thousands of songs that they have downloaded). I am well aware that I am not the norm in that I find listening to music or watching movies to be a waste of my time (for the most part) but I am equally certain that most people don't have close to a half of a terabyte of downloaded media on their hard-drive.

    I believe that if there were to become an actual tax on music it would have to maintained by some part of the government structure (which most likely will not happen). Therefore, (loaded therefore) I can see no real way that this plan will be accepted by the majority. If it does become of service similar to netflix, subscribers will download unlimited forms of media and find ways to share them with people who are not subscribers. If it does become universal to avoid the aforementioned problem, then it would become an enormous hassle to organize individual programs for media sharing, which would then lead to an overall plan (based off of the mean of internet users). And to this resolution I am forced to question how the billing procedures would come about and whether or not there would become a limitation to the amount of media downloaded.

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