5th Mar 2024

Europe winning the battle against online piracy?

  • Representatives from the creative industries: games, books, film, music and press in debate at the EUobserver conference. (Photo: EUobserver)

The war against online piracy has been a ferocious but as yet almost entirely unsuccessful struggle. It has left both the entertainment industry and the governments that have tried to buttress them bloodied and until recently at a loss as to what to do.

Suing downloading scofflaws was expensive and ineffective. Cheesy adverts comparing downloading to stealing cars were mocked by the teenagers they were targetting. Legal downloading businesses trying to convince people to pay for the series of zeros and ones they elsewhere could get for free - and often more easily - were closing up shop. Over a 1000 digital music companies have died in the last ten years.

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But the war alighted upon European battlefields this year for some fearsome clashes both in national and European parliaments, and for once, the businessmen and politicians, with new laws and business models, may be prevailing.

They believe, with the aid of new types of laws that cut off or restrict internet access of the pirates, such as France's Hadopi law passed in October and the UK's Digital Economy bill, currently before parliament, that they are finally winning.

Indeed, in Sweden, after four individuals associated with the Pirate Bay, a sort of Google for pirated material, were sentenced to a year in prison and fined 30 million krona (€3.7m) in April, some 60 percent of Swedish filesharers were sufficiently spooked and have cut down on the amount of filesharing they do or stopped the practice completely.

Yet there are other kinds of online content that are struggling but struck by different maladies. TV programmes, as they are more disposable - people generally only want to watch them once while songs people want to 'own' - are more likely to be streamed than downloaded.

Hadopi-style laws do nothing to tackle this problem. Meanwhile newspapers have few issues with piracy, however much copying of articles into emails or onto blogs is a pest. It is the splintering of advertising in the online world that is killing these watchdogs of democracy. Gaming for its part is fairing quite well, with online gaming by definition not piratable - unless the pirates physically break into a gaming company's premises and copy a server, but most other kinds of software producers face many of the same issues that record companies do.

Death of the taste-makers

Andrew Keen, the author of The Cult of the Amateur a polemical attack on the destruction of cultural production for which he believes the internet is responsible argues that all of this is not an inevitable process and that societies actually have a choice as to whether to go down this road. Needless to say, he cheers the tough approach pioneered by France and Sweden.

"The old industrial system [prior to the internet] created a hierarchy in which a small group of people controlled the means of production of information and controlled how that came out. A small group of people who determine taste," he told a Brussels conference on online content organised by EUobserver. "And they were quite effective in filtering that talent. The old industrial system wasn't just or fair but it was effective."

He argues that the talent scouts, the producers, the editors, sub-editors, publishers, trained journalists - the 'middle-men' - selected the wheat from the chaff, and presented that content back to consumers. In a world where everyone is a producer of content and where all that content is available for free, a tsunami of dross is created, with no one paid to sift out the good from the bad, the important from the banal.

"When you create cultural situation where everyone can become a producer, doing away with the hierarchies, the bottlenecks, then you have this eruption of so-called content, but you have the disappearance of mediators of value."

He described the internet not as a tool but as an ideology, representing resistance to this earlier industrial media system, an anti-authoritarian rebellion against hierarchy that came out of the 1960s.

"We have to choose what we want. The internet is not inevitable. No technology is. We have to choose between a culture that is unjust, unfair, but where there is more talent ... one in which we recognise that there are only a small group of people who are talented and their works need to be protected by a strong copyright regime."

"We can have an open internet, whatever that means. Or an internet where the talented are rewarded. I prefer to reward talent."

Creative destruction

The European Parliament has been one of the strongest opponents of internet-cut-off laws. This year, a wide-ranging package of telecoms legislation was held up for months over the chamber's stubborn demand that access to the internet be considered a fundamental right. To participate fully in society today requires such access, they said, a requirement that trumps any slight to copyright holders.

Nevertheless, not all of the parliament is of the same mind, and in any case MEPs are still disturbed by the fall-out hitting content producers.

Doris Pack, the centre-right MEP and chair of the parliament's education and culture committee said: "The reality is that anyone and everyone can become an online content provider. On the one hand, creative opportunities exist, this facilitates open politics and cultural debates, it promotes freedom of expression. But there are also major political and social implications."

"The internet has given rise to user autonomy, participation and diversity, but it has also undermined intellectual property rights and undermined quality of content," she told the same conference.

She argued, paraphrasing Spiderman's Uncle Ben, "With great opportunity comes great responsibility," and that the solution to the problem was strong copyright protections, adding that she supported initiatives such as those being launched by some member states to combat piracy.

But most of what is being done is via quite forceful legislation at the member-state level. Brussels has no such powers. So what can the European institutions do? The emphasis appears to be providing a better framework for new types of businesses, but otherwise letting the market do what it will. But now, ahead of the installation of a beefed-up media department - the ‘Digital Agenda' portfolio under Dutchwoman Neelie Kroes, the commission's outgoing competition bulldog - in the second Barroso administration, is a time of flux. The commission is currently holding a public consultation asking sector stakeholders essentially what should be done.

Jean-Eric de Cockborne, the head of the audiovisual and media policies unit in the commission's currently named Information Society Directorate General recognises that as technology changes, old business models will die, but is it the technology that is undermining these companies, or is it just that the legislative framework has not caught up with the technology yet?

Thus far, he says, the commission's emphasis has been on the promotion of new business models, education of consumers and finally fighting piracy.

"Creative destruction is perfectly normal in economics. At the same time, the question is what is the role of public authorities in this context? What can we do?"

The commission will base its course of action on the result of the consultation. One thing is for sure, "The digital agenda is at the centre of the priorities of the new commission," which is what you expect a commission official to always say, but the scraps over internet rights both in the parliament and at the national level - even the emergence of a - still tiny - new political force, the openly pro-piracy Pirate Party have put the topic at the centre of debate suggest that they mean it.

Emptying the sea with a spoon

La Quadrature du Net, a France-based group fighting for digital civil liberties, has very much been leading the charge against internet cut-off and other restrictions on online rights. Co-founder Jeremie Zimmerman believes these attempts have got it all wrong.

"This all sounds like trying to empty the sea with a spoon," he said.

He argues that these taste-makers, these middlemen of which Mr Keen laments the loss, have been a barrier to creativity and the ones that made the most money. The internet strips out these 'skimmers' to deliver more control - and, if the legislative framework is right - more money to the artists.

"This is the blatant lie everyone is starting to realise. When the industry fights for control they do so in the name of the artist. But we can get rid of the middlemen."

"Everyone accuses me of wanting everything for free - free as free beer. But this doesn't exist," he continued, himself an author. "It is just that I don't believe that the only model should be paying for copies. Copying one line one million times is not like stealing copies from shops."

But he does have a solution. He argues for a "creative contribution" - a levy applied to internet access subscriptions of roughly five euros a month which would then be passed on to creative producers based on how many plays, reads or views a work has received.

"Based on our calculations, this works out to be €1.2 billion a year in France - the equivalent of the whole volume of the industry."

Although some at the conference suggested this amounted to a tax that neither the public or the telecoms and internet service providers would like, Ms Pack, the MEP had not heard such a suggestion before. "It's interesting," she said. "Let's look at it."

Later in the day, one telecoms outfit, Denmark's TDC surprised many by saying that the company had effectively already done this, although in reverse, and it seemed to be working. The telco's TDC Play service allows internet and mobile subscribers to download as much as they want, and it is TDC that pays the licence, the bill, to the rights holders - the music companies.

"It's an all-you-can-eat service," the company's former director told the crowd. "We buy the rights and the customers access it with no extra cost.

Why on earth would they do that? If a customer lets the subscription lapse, the tracks disappear from a computer or phone, meaning the subscriber is unlikely to switch to another provider. TDC is buying brand loyalty by 'loaning' their customers music. According to independent figures, forty percent of users have reduced or stopped downloading illegally and, after years of decline, digital music revenues have doubled.

Focus on the telcos

Neither new business models nor draconian internet-cutoff laws will save the day, says Gerd Leonhard, a one-time digital music entrepreneur and now self-styled media futurist. Too many digital music companies have tried and failed. TDC and Spotify, the other current darling of online music, but based around streaming and advertising, will both fail too, he said. Even iTunes is only used by two to three percent of the population. ITunes is there to sell iPods, not music.

"There are 350 different ways of exchanging music," he said, from via Bluetooth to USB key. The cut-off legislation only targets one way. "The British, French attempts to lock computer probably won't work either."

The trick, he argues, is taking a page out of the legislative response to the advent of the radio decades ago. When radio first appeared, music producers and legislators feared that no one would want to pay for music any more if they could listen to it free with a twiddle of the radio dial. To overcome this problem, the radio music licence was invented. Stations that played music had to buy the licences from the rights holders, monies from which were then distributed back to authors.

Mr Leonhard wants to see the same sort of thing, a public content licence for the internet. ISPs, mobile operators and other telecommunications companies - anyone distributing music - or other content - over their networks would buy licences from the rights holders. They could then recoup this cost from users - a euro a week perhaps.

According to Mr Leonhard, this would produce a pool of £2.6 Billion GBP per year in the UK just for music. "Globally revenues for telecoms are predicted to be $300 trillion by 2015. That's not enough? It is."

Such a licence would have to be either a voluntary collective licence or mandated by government for it to work, he said.

Could the European Union be the first region to save online content from the perils of the internet? Could such a system work for other forms of content, for newspapers, for films, for software? It is up to Ms Kroes and her new 'Digital Agenda'. What will be in that agenda? Keep watching this channel.

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