The guilty party in the copyright game

In an amusing democratic coup by French Socialists, President Sarkozy’s illegal downloading bill was defeated when a crowd of MPs snuck up on the near-empty National Assembly and voted the law down, 21-15.  This was embarrassing for Mr Sarkozy.  In my view, it serves him right and I wish the Socialists the best of luck in defeating the law when it is next on the agenda.

The proposed law is Sarkozy’s solution to the problem presented by the Record Industry & Motion Picture Associations of America (RIAA & MPAA respectively): their pre-internet model of distribution is unattractive to the modern consumer.  The costs undertaken in the production, storage, distribution and sale of physical media simply cannot compete with digital distribution.

It has been just over a year since I completed my dissertation on this subject.  This news has prompted me to think about it, and I would like to reiterate an argument I made then, but in stronger terms.

The move to digital distribution of music (and other media) is powered almost entirely by the market.  It is a complete fallacy to suggest that at the turn of the millenium, with the advent of Napster, millions of people threw their ethics out the window and decided they need never pay for a musician’s recorded work again.  As Radiohead’s release of In Rainbows demonstrated, people are still willing to pay a reasonable price for a product they like.  The album – available for free – netted more money for the band than digital sales of all of their other albums combined.

The reality is that the millions of people who used Napster followed the path of least resistance.  Yes it was free, but it was also easier and quicker, and provided everything to the comfort of your own home. As soon as broadband speeds allowed it, the market shifted to the new model of distribution.  Physical media was dead.

The music industry made a fundamental error in trying to fight rather than embrace the change presented by new technology.  Largely speaking, the past decade has been dominated by an industry attempting to kill itself off, and lobbying governments to join in.  By way of example, the most significant and immediate reaction of the industry was to slap Digital Rights Management (DRM) technology on their physical product, to prevent copying.  Of course, as we know now, that doesn’t work.  A quick refresher – DRM is flawed because:

1. No security system is ever unbreakable.
2. Really, no system is ever unbreakable.
3. In order for your product to still be usable (i.e. in order for the customer to be able to listen to the album they just paid £15 for) you have to give them the key to unlock the restrictions.  In doing so you have given them everything that is needed to break it.
4. There are a lot of apparently very talented people ‘out there’ who seem to get a kick out of cracking these things – go figure.
5. The protection need only be broken once. Once broken, the digital data can be released over the internet, without the DRM technology protecting it.
6. Taking the above together it is inevitable that your product becomes available to download for free, given enough time.  This means that the only people you punish with DRM software (and it does punish – remember Sony BMG’s rootkit mess?) are the few legitimate customers you have left.

As if #6 wasn’t upsetting people enough, you then start suing people.  Not just people though; mothers, minors, students.  People not well-placed to have litigation directed at them from a huge industry body.  All these moves have done is erode any sympathy consumers may have had for the industry.

The final pillar of the industry’s policy has been legislation through government lobbying, bringing us back to Mr Sarkozy.  However, people downloading music are not necessarily doing the musicians any harm; digital flexibility makes it much easier for artists to be discovered, and many have already adapted to making most of their money from live performances.  The lynch-pin in the industry’s argument when it talks about lost revenue is that statistics on music downloading are representative of lost sales.  Yes, there is a coincidence of sales going down and downloads going up, but the causal link has not been adequately demonstrated.

What is left is a mess of the industry’s own making.   A generation of consumers are unwilling to cough up to companies they perceive as doing little to benefit artists but plenty to punish the people who would give them money.  A new wave of artists are already keen to distance themselves from the industry: as more of them recognise the benefits of distributing their music without a label, the industry is left in a very dangerous place.

It would be much better for music, and the market, if Mr Sarkozy just left internet downloading alone.  Whether the industry chooses to hang itself is a question for its shareholders.