Copyright and the blank media levy
p2pnet news view | P2P | Music:- Regular p2pnet readers will recognise Christopher Parsons (right) as someone who’s deeply interested in Deep Packet Inspection (DPI).
A doctoral student at Victoria University on Vancouver Island, BC, his research interests focus on how privacy is affected by digitally mediated surveillance, and the implications it has in, and on, contemporary Western political systems.
But he’s also a music lover and as such, signed up to the new a2f2a.com Artist 2 Fan 2 Artist project just launched by myelf [Jon Newton] and Billy Bragg.
“The intent of the site is to bring artists and fans together and encourage these parties to speak directly with one another, without needing to pass through intermediaries such as producers, labels, public relations groups, managers, and so on,” says Christopher on his blog, Technology, Thoughts, and Trinkets.
He notes a key element of the site is the “discussion of paying artists (and other content creators); how can we avoid demonizing P2P users while at the same time allocating funds to artists/copyright owners in a responsible manner.”
Musician, writer, p2pnet contributor and a2f2a technical manager Chris Ovenden broached this in `In Favour of a Music Tax`, “and I wanted to bring some of my own comments surrounding the idea of a music tax to the forefront of my own writing space, and the audience here,” says Chris, continuing »»»
I think that an ISP-focused levy system is inappropriate for several reasons: it puts too much authority and control over content analysis than carriers need, puts carriers at risk when they misidentify content, and would make carriers (for-profit content delivery corporations) in charge of monitoring content without demanding consumers that pay `full value` for content moving through their networks. This last point indicates that an ISP-based levy puts ISPs in a conflict of interest (at least in the case of the dominant ISPs in Canada). Another solution is required.
I`m a Canadian, and I don`t have an issue with a levy-system that works.
In Canada, we are charged a levy on all blank media that is sold. The levy originated several years ago, and was meant to recoup losses from the copying of mp3s (and related audio files) onto disks. The levy is very small:
- $0.24 per unit for Audio Cassette tape (40min or longer);
- $0.21 per unit for CD-R Audio, CD-RW-Audio & MiniDisc;
- $0.21 per unit for CD-R, CD-RW (non audio).
- In 2009 the levy on CDs and MiniDiscs will rise to $0.29 (Source)
Arguably, fewer people burn mp3s onto disks than in the past with the advent of cheap and portable storage media, media tends to find its way to mp3 players and similar portable (and slightly less portable) media environments. Rather than targeting ISPs (who, really, should function like semi-intelligent data piping networks, rather than smart content monitors) why not impose a small levy on mp3 players/consumer electronic storage equipment?
When I see an iPod or something like it, and am told that `160GB of storage just isn`t enough`, I have a hard time believing that someone has paid the not-so-small fortune to fill it with music, TV shows, and other content.
I argue that we should toss a levy on the device at the point of sale, and then have a mechanism where the money is blackboxed and distributed back to content owners.
Is blackboxing ideal? No, but distributing the funds collected can be improved by developing either a more broadbased sampling of what is being listened to (i.e. one that accounts for the long tail of P2P downloads, YouTube watches, etc) or `smarter` devices (i.e. ones that can read what is being played and then report this back to a mothership) to adjust the levy distribution in near-real time. As a consumer, the former is an acceptable shift in distributing the levy, whereas the latter strikes me as a gross violation of my reasonable expectations of privacy (regardless of whether it would cross an actual legal boundary). Let`s think through what this `tracking` system might look like:
First, it won`t involve any deep packet inspection appliances, so we can dispel any worries associated with that particular technology. Instead, we get a few clever programmers together to develop an aggregation system that identifies the number of downloads of songs/albums/artists across a wide set of media environments (e.g. P2P sites, YouTube, MySpace, etc). Either the sites themselves or the aggregation system can include anonymization protocols that scrub data sets after initial collation, ensuring that the data can`t be traced to individuals/sites.
Scrubbing protects consumers and has the benefit of mitigating some efforts to `game` the system by demanding particular sites are included in the aggregation step at the expense of less favourable ones. It should be noted that I`m not seeing this system as one that tracks particular users but instead the number of downloads particular sites have for files. While this doesn`t generate 100% accurate picture of content transfers, it will capture the long tail better than the present Canadian levy`s evaluation metrics.
Taking account of the fluidity of the P2P environment, it is important that the aggregation system is designed so that adding new sites to the scrape is relatively simple, and the system generally should be modular so that it can scrape new P2P platforms as they come available.The nice thing is that, once this system is paid for and set up, it`s largely self-running AND can be exported to different jurisdictions as needed. This system should be open source, so that anyone who is interested can take a look at how the algorithms calculate levy distribution in an effort to facilitate transparency and rigorous code-checking.
While there are certainly valid concerns around the organizational collection and distribution of these levy fees, I see a distinction between the value of a levy and organizational logics. In Canada, as an example, a key issue that I keep hearing between major players in the content industry is that the metrics used to identify popular artists is defunct it needs to be broadened to capture the long-tail of media downloads. The Canadian situation sees (relatively) little overhead, and has distributed over $100 million dollars since the levy`s inception. This isn`t a small amount of money.
This model does recognize that labels will get some of the money out of the levy system should they own the copyright of the content being downloaded. There isn`t any reason why they shouldn`t receive some of this money from a (layman`s) legal perspective. If this is perceived as a problem, because it ignores the artist, then that`s a larger issue of copyright ownership and not a reason why the levy itself is unworkable. If artists retain their copyright, they get the cut of the levy fund instead of a label. If there is a strong desire to change how present copyright systems work (and I think that there should be) that doesn`t undermine the levy-system; we should reform rather than scrap the levy, and not let copyright/label issues motivate a refutation of the levy model.
Perhaps most crucially, the levy is not designed to capture the `full value` of media it doesn`t correlate one download to one sale. Instead, it recognizes that there is partial value derived from a download that is unlikely to parallel the same value that is demonstrated when someone purchases a CD, pays to download music through a content delivery system like iTunes, or attends a concert. If we take the stance that P2P is a means of facilitating interest (and partial value) for content then it is obvious that the levy-system is not enough, on its own, to create a full-value stream between artists and fans. Additional monetization schemes must be adopted so that, after deriving partial value from a download, fans (as distinguished from downloaders) can provide what they perceive as full value to the artist(s) in question. How this is done extends beyond a levy system while important, I don`t want to work through my thoughts on this extension right now.
I want to quickly turn to some very broad, general, and tentative ideas of how the collection and distribution of a levy might work. This is most definitely a work in progress.
While there is a worry that the levy could increase as various parties who are not currently supported by the levy system try to muscle their way in, I think that the solution is just to set a particular (fixed) rate for the levy, and have it increased by X (where X=rate of inflation, or some other clearly identified, relatively autonomous metric that is outside of the music market), and then an organizational metric for distributing funds. Figure that every Y years the distribution metric could come up for organizational review, with the review board being composed of a balanced group of people (e.g. members of the non-profit`s board, artist and label copyright holders, hardware vendors, fans, etc). Where it appears as though the non-profit levy-distribution group is overstepping their bounds, a judicial review could occur (as happened in Canada, when there have been attempts to extend our levy to portable music devices).
In terms of actually establishing how much money the levy should collect per device, I`m inclined to set a very low levy that is based on a per GB/TB calculation of the storage media purchased. These rates should be automatically adjusted over time per a formula that takes into account drive size increases by reducing the cost-per-GB/TB so that the levy doesn`t get prohibitively high. The algorithm for this can be developed prior to the levy being restarted/instated to avoid hidden surprises and put in the public domain. Participation from a wide community should be invited, with a recognition that any formula set is a compromise position; there is no way that everyone is going to be happy. Consensus is highly to emerge between all the interested parties.
On the whole, what I`m trying to express is that levies are workable, partial, solutions.
They do facilitate artists getting paid for their contributions to culture. They do benefit the consumer because it is clear why the levy exists and how funds are distributed without adding complexity (for the consumer) at the point of sale. Levy systems do not try to equate one download to one sale, and instead recognize the partial value of downloaded media. The proposed hardware-centric levy does not require ISPs to spy on content as it moves across their networks. Further, as I`ve proposed the aggregation of data points, this levy system does preserve anonymity and privacy.
“Does this approach ultimately result in consumers paying a slightly higher price for blank media/devices?” - Chris asks, adding:
“Sure, but I don`t think that`s anymore unreasonable than paying the trivially small environmental taxes already associated with the purchase of new computer equipment.”
First they ignore you, then they laugh at you, then they fight you, then you win ~ Mahatma Gandhi
Technology, Thoughts, and Trinkets – Copyright and the Blank Media Levy, October 30, 2009
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October 31st, 2009 at 12:16 pm
@Chris:
1) If the blank media levy is so small, have you any idea why the price of CDRs is approaching DOUBLE that of the similar, but more-capable DVDR?
It would appear that “per unit” means “per disc.
If that’s the case, I don’t call that a small tax.
2) It’s nice to say we can “just put limits” on these proposed levies when it’s being theorized, but we all know that’s not how it works in practice.
Who’s going to impose these limits?
Who’s going to enforce them?
Who’s going to prevent all the other interested parties from demanding their cut and inflating the whole thing to the point of bursting?
We all know the answer to any of those is not “the Government”.
How do you ignore the 800-pound gorilla in the room?
This thing has “Pandora’s Box Syndrome” written all over it.
3) You’ve already acknowledged that “some” of the money would end up in the hands of the labels (mostly due to owning the majority of copyrights).
Why give them more, then?
Why go through the costly administrative headache of implementing such a scheme, if we know it’s only going to benefit the labels??
From that perspective, this could be seen as nothing more than an elaborate (and perpetual) “bailout” for a failing business model.
4) You’re obviously not in favour of a provider-based levy (”Internet tax”?), or the prospect of having ISPs do the tracking necessary in this scheme. (Neither am I!)
We obviously need to be fearful of any plan that would give anyone else that kind of power, all in the name of appeasing copyrights. I can’t even imagine who’d be a suitable “administrator” in that respect – certainly not the labels or any of their “authorized” music sites. Don’t think for one moment the labels wouldn’t kick and scream until they got that arrangement!
October 31st, 2009 at 1:03 pm
Chris, you seem to have accepted the legitimacy of the cartel’s aspiration to “capture the âfull valueâ of media”. You do realise that it has only been the privilege of copyright that has come close to enabling this? In any other trade one does not capture ‘full value’, one exchanges one’s labour or product for whatever both parties consider it worth in a free market. It is then the purchaser that goes on to obtain value from their purchase, or sell it again. The seller also goes on to obtain value from whatever they received in exchange.
Anyway, the idea of a levy or tax is a failure of imagination. Because you’ve bought the line that the value of art lies in its copies (instead of the art), when the market for copies ends you conclude that art has no market value and must therefore be charged for (under threat). There is obviously a fundamental flaw in this. The art is not the copy. You pay the artist for their art. You pay your neighbour for a copy (or they give you a copy for nothing). Copy=$0. Art=$1,000. Don’t confuse the two.
The traditional solution to apparently intractable local problems like charging for copies, is to think globally: “We’ll get our big brother the government to knock heads together and collect a levy through force”. Instead, why not at least think half-way, say at the audience level, i.e. identify the artist’s customer? Then, instead of a reluctant and angry planet charged a tax on threat of jail time, you’re dealing with a crowd of people who a priori want to pay the artist for their work. Why not come up with a way of charging that willing audience a levy for the artist’s work? In fact to them it won’t be a levy to be charged, but a share of the commission they WANT to pay the artist.
Then you are effectively enabling the audience to assume the role of the artist’s traditional customer, the publisher. The publisher traditionally pays the artist a pittance for their work and then the publisher attempts to extract extortionate amounts of value from the public for their enjoyment and use of it – with none of that revenue from extortion generally getting back to the artist except in rare cases.
So let the audience pay the artist, and then it’s up to the audience whether they pay them a pittance or a decent amount (probably the latter). Fortunately the audience has no need or inclination to extort monopoly rents from everyone else.
So, when you reduce the scope of taxes down from everyone to just the traders concerned (each artist and their audience interested in exchanging art for money, money for art), you end up with the free market exchange that should have been obvious in the first place. Why waste billions on a levy? There are certainly organisations who’d jump at the chance to have money wasted on them, but that doesn’t make a levy a good idea.
October 31st, 2009 at 3:45 pm
For you, it may be an acceptable price, but even the recycling taxes are prohibitive for me. I avoided buying a new monitor until I discovered a liquidator which would sell me a factory-refurbished LCD without the markup.
Given the kind of markup that rich politicians and businessmen seem to find acceptable, I’ll buy cheap little 4GiB MP3 players from China over eBay, store all my media on an untaxed 1.5TiB hard drive, and swap it out like EMS RAM on a DOS machine if I have to.
October 31st, 2009 at 5:23 pm
The problem with any levvy applied to blank media, ISP downloads or MP3 players are the inherent presumtions -
1. that the material is music, video or software from a commercial entity.
2. that the material copyright holder needs to be reimbursed for a lost “old media” sale.
The article gives “open source” a nod, but fails to recognise that because of open source, free software, and initiatives like the creative commons, that there is growing body of legitimate content to be downloaded for which a fee is not required.
That means (to me anyway) that either the proposed levvies need to be scrapped and another method found (so as not to penalise those who may be legitimately downloading free content and are therefore being unjustly charged) or at the very least funding from these levvies distributed to some of the free content providers who (while they don’t _require_ payment for download) may rely on voluntary payment for content.
I actively avoid proprietary software, I don’t generally rip movies and DVDs, and yet over the last 20 years have amassed a CD collection (all paid for) of a couple of thousand discs. I am however employed in the tech industry and have a personal interest in things like OpenSolaris, BSd and Linux, and so download and burn many tens Gigs per year. I object to pating a levvy on the dics I use, the data I download, or the media player I fill with my already-paid-for music.
This whole discussion around a “tax” simply signals a greater problem, the failure of “old media” models. Artists should be remunerated for their work, but I think the record labels are just getting in the way as they struggle to remain relevant.
October 31st, 2009 at 5:43 pm
Lest it be thought that I’m not responding, I have a long response to various comments at a2f2a (http://a2f2a.com/2009/10/31/copyright-and-the-blank-media-levy/#more-291) comment 7.
@RW; I just paid $2 for a $370 purchase for a netbook, and the last LCD monitor I bought ($400) came with a $10 environmental tax. I’m a student, and I didn’t find it particularly prohibitive in either case, though I can appreciate how any markup can be for even more fixed budgets than my own. The majority of the Canadian consumer population isn’t in such a poor situation that an extra few dollars is prohibitive to their buying habits.
@EMP
I’m not trying to say that ‘open source doesn’t exist’ (you’ll not that everything I write is under CC license, actually) but that when I see a 160GB iPod I’m rarely confronted with a situation where they have 160GB of open source/CC music and video. To those few that do, well, I pay for local schools and don’t have children. I don’t find paying that particular tax prohibitive, vicious, or unfair but as me subsidizing something that is a known good (education on the one hand, artists and the vibrancy of culture on the other). Not all can or will be happy with any solution; this piece was written with the driving question, ‘how can artists receive some partial value when what they produce is downloaded?’ and tried to offer a solution. No solution will ever satisfy anyone, given that it is necessarily a strategic decision of how to engage with this issue, as is true of any and all political/economic decisions. Some compromise position needs to be found, and as is the case of any and all compromises not everyone (anyone?) is every totally happy with a compromise.
October 31st, 2009 at 6:14 pm
Right now the current 7 majors corporation of parasites can not survive particularly considering their music recording business.
So this leave the door open to indies and independent artists to make it without having these parasites in the middle sucking their blood.
The entertainment business must and will adapt to the computer technology. Frankly without these 7 corporations of parasites in the middle of our live these new business models would be already operational and kicking.
It is time to put these parasites out of business right now even if we have to shot all of them one by one!
They represent a clear and present danger to our societies and our freedom.
November 1st, 2009 at 6:07 pm
“When I see an iPod or something like it, and am told that â160GB of storage just isnât enoughâ, I have a hard time believing that someone has paid the not-so-small fortune to fill it with music, TV shows, and other content. ”
I’m tired of being penalized for other people’s lack of understanding. The MP3s I’ve ripped from my CD collection alone come to 104GB. Add the music DVDs that I’ve bought and ripped to XVID format, and my (now-dead) 160GB Archos couldn’t even handle it. I haven’t even ripped the hundreds of hours of TV shows I’ve bought in DVD sets, let alone my late partner’s extensive movie DVD collection. A true universal jukebox for my collection would need to be in the terabyte range. That’s just the stuff from physical media; add the stuff I’ve legally obtained from the Internet and the ”
And yes, I have spent a fortune on it. At the start of my career, music was where the single largest chunk of my disposable income went. 15 years ago I used my collection as collateral when getting a loan. The fact that most people don’t care about music enough to invest in it as I have doesn’t mean that everyone who does have a huge collection amassed it through nefarious means. For someone who claims to be part of a “fans and artists united” type of setup, not knowing anyone who loves music as much as I do (and many of my friends have collections that dwarf mine) is really a bit sad.