Internet service providers are beginning to work with the creative industries to curb illegal downloading, writes Paul McGuinness.
Three years ago, somewhere between U2’s album No Line on the Horizonand the 360 Degree world tour, I plunged into the raging debate over the future of music in the age of “free”.
My campaign has focused on the role of internet companies, and the crucial difference they could make if they confronted the systemic copyright infringement that has helped wipe out so many musicians, bands and labels in recent years. It has been a frustrating and slow-moving process. In many countries internet service providers (ISPs) have consistently and stubbornly resisted cooperation.
This week, however, from the world’s largest entertainment market, the US, comes good news. The biggest US ISPs have just agreed with music and film industries to introduce a new system of “copyright alerts”. These are warnings that, with escalating urgency, aim to nudge broadband users away from piracy towards downloading and streaming music from legitimate services. There will be the prospect of deterrent sanctions for those who repeatedly ignore the warnings.
This has been agonisingly slow in coming, but it is an important step forward in the international debate over music in the digital age. The idea of ISPs taking on obligations to stop copyright theft on their networks is moving into the mainstream.
The US is not the first country where ISPs have started to cooperate with rights holders. Similarly sensible thinking broke out in France in 2007, thanks to President Sarkozy. France, along with a growing number of other countries, including South Korea and most recently New Zealand, has introduced a so-called graduated response law, obliging ISPs to take proactive steps to help curb copyright abuse. The UK has passed its Digital Economy Act which, if it is implemented effectively, will go down a similar route.
Different countries will approach this their own way, and there can be no one model for exactly how ISPs get involved. The US agreement is a voluntary private sector deal – elsewhere the route almost certainly needs to be different. In virtually all other countries, private negotiations have proved worse than fruitless, leaving legislation as the only route possible.
Why is the needle in this debate on the move? First, no doubt because “free” is no longer just a problem for the music industry. Film studios, book publishers and newspapers are all now in the same storm, caught in a race against the clock to sort out successful business models before being sunk by illegal file-sharing or other forms of “free”.
Another reason is that it is nowadays impossible to argue, as many used to, that there is a purely market-based solution to piracy. The music industry has led the field with new models for consumers – there are over 470 digital music services worldwide, many of them “free-to-consumer” sites such as Spotify and We7. None of these services has much hope of long- term success while competing in a world where, according to IFPI, 95 per cent of all music downloads are illegal.
For some years, “fighting free with free” seemed the answer to all our problems. Today, that honeymoon is over. Spotify, in many countries the champion of the free-to-consumer music streaming service, is now cutting back on its free offering. It is trying to migrate its fans into payers, offering a £10 monthly subscription. That is a huge challenge.
Like newspapers which have hastened to erect website pay walls they prematurely abandoned years ago, the music industry has discovered an inconvenient truth – “free” does not really pay. It cannot sustain the artist royalties, the copyright fees and the investment that makes the artist’s career possible in the first place.
And that is the fundamental problem – who will fund the future of music? This is not an issue that directly affects a band like U2, of course. Yet I still don’t see a clear answer to the question I asked in my maiden “ISP speech” three years ago – in a world of 95 per cent piracy, where is the investment going to come from to fund the next generation of bands such as U2 and Coldplay?
The answer to me is clear. A thriving music business needs a fair, responsible environment to work in, and ISPs, the internet’s gatekeepers, hold the key to this. By the graduated response approach and other measures like systematically blocking infringing websites they can significantly reduce digital piracy. Surveys, the latest by Hadopi in France in May, prove what should be obvious: that when people see rules protecting copyright being enforced, they actually change their behaviour.
No one expects teenagers brought up in the age of Limewire to convert overnight to legal download sites. Yet the migration to legitimate ways of enjoying music, respecting copyright owners, will happen over time.
The ISP agreement in the US is good news for music and the creative industries. It is time now for action elsewhere. In Europe, Commissioner Barnier is reviewing EU copyright enforcement rules for the digital age. This is a chance for Europe to use its legislative clout to get ISPs to cooperate.
Other governments have long been debating their own approaches. Now is the time to stop the thumb-twiddling and the soul-searching. ISPs need to be active partners, not bystanders, in shaping a legitimate internet where artists and creators can be sustained by their work. In the US they have made a welcome voluntary step in that direction. Elsewhere, it will need the pressure of government and legislation to make it happen.