SAN FRANCISCO, September 7, 2010 - U2's band manager Paul McGuinness has once again lit up the debate over who and what's responsible for the decline of the music industry. In the August edition of British GQ, McGuinness declares: "I am convinced that ISPs are not going to help the music and film industry voluntarily. Some things have got to come with the force of legislation."
McGuinness made the comment in a 3,400-word essay entitled "How to Save the Music Industry."
The debate he has stirred up is worth paying attention to since it sounds as if it might be replayed on Capitol Hill in upcoming months.
In an August edition of British GQ, McGuinness renewed a January 2008 call for legislative bodies to mandate a "Three Strikes" approach to policing and curbing music piracy on the internet. France adopted such legislation last Fall, but has yet to start enforcing the law. The scheme basically gives Internet Service Providers' customers two warnings for their allegedly infringing activities until they are cut off from the internet for a set period of time. In France, the period can last up to two years.
This three strikes approach has been controversial among policy makers around the globe because of privacy and due process concerns, not to mention the costs that it imposes on ISPs. Most recently, the effort to impose more responsibility on internet intermediaries has been hotly debated as bureaucrats around the world tried to implement such measures in the Anti-Counterfeiting Trade Agreement, which is scheduled to become final by the end of the year.
A recently-leaked document shows that the proposal has been dropped. Nevertheless, the Recording Industry Association of America's President Cary Sherman told CNET this August that the Digital Millennium Act "isn't working."
Sherman told CNET that it might be necessary to enact new legislation to better address the piracy on the internet that continues unabated. U2's label is Universal, a key member of the RIAA.
McGuinness first stirred the industry and the tech world up in January 2008 when he delivered an incendiary speech at the Midem Music Convention, the annual music conference in Cannes, wherein he denigrated Radiohead's online pay-what-you-want music experiment with its album " In Rainbows," as well as Silicon Valley venture capitalists and technologists, calling them the makers of "burglary kits."
The long-time band manager did call on the technology and music industries to work together on new music distribution and revenue-splitting models. But he also called the "Safe Harbor" provisions that protect Internet Service Providers in Europe and the United States from being responsible for the infringing activities of their users a "Thieves Charter."
Music industry veterans have responded online to McGuinness' piece in the past few days by pointing out that it's far too simplistic to blame piracy solely for the recorded music industry's downward spiral.
Instead, their message is: "It's the licensing, stupid."
"In order to get others to launch more music services, the industry must first adopt simple and sensible licensing policies that invite and encourage entrepreneurs to build businesses around the sale of (or access to) music," writes venture capitalist and former eMusic CEO David Pakman in a recent Midem blog post. "It is all too convenient to dismiss those who disagree with Paul's 'The ISP's must police the Internet' solution to the music industry's ills as an angry mob."
Jim Griffin, managing director of the digital entertainment consultancy OneHouse LLC, also responded to McGuinness' August piece by pointing to the industry's need to focus on collective licensing.
He points to an analysis by economist Will Page at PRS for Music that shows that revenues for the international licensing of music is increasing as revenues for sound recordings (CDs, etc) continue to decline.
"As always, progress will be slow, but increasingly it comes down to this: We need to make it much faster, easier and simpler to pay for music. When it is, more will," writes Griffin in a recent online note responding to McGuinness' piece. "This requires a clear enumeration of rights, a transparent and accurate database of who owns what, specified by country, for both sound recording owners and songwriters."