UK's draconian anti-piracy proposal dissected
So the UK government is looking at following in French President Sarkozy's footsteps by forcing Internet Service Providers (ISPs) to monitor thier customer's web usage and disconnect them (after a warning) if they are found to be downloading illegally. This switch of legal responsibility from the copyright owner to the internet provider is significant - but more alarmingly so is the change of web access into something which can be monitored and controlled by the people providing you with access. I'm supposed to be taking time out in India, but couldn't resist sharing my thoughts when I heard the news.
Internet Protocol is built on the all-data-is-equal model, where anonymous packets of information are sent from servers to users, with no-one in between having the faintest idea what that data is. The switch to a system (supposing it can be securely built) which identifies this traffic and acts as a result is a culture shift in the fundamental nature of the web - potentially allowing, for example, ISPs to block politically sensitive material, or provide faster, more stable web access to big fee-paying webisites over slow ones.
Piracy is of course a terrifying prospect for the film industry if it simply heralds a culture of not paying for content. Unlike the music sector, non-piratable aspects of the film business are rarely profitable (while Radiohead makes over three quarters of its income from touring, most films are lucky to cover their marketing costs for a cinema release). Furthermore, while you can make a film on no budget, it's hardly the same as recording an album in your bedroom or mastering on your laptop; the lack of money will be obvious on screen. Films are the most expensive artform going, and a future where users do not expect to pay for the films they watch at home would lead us into the hands of the Orange Film Finance board from the cinema ads, putting up the budget of a film in return for brand exposure. It's a horrible prospect.
But at the same time, the Recording Industry of America's heavy handed approach with music downloaders (sending huge fines and court summons to young children and dying seniors) has done nothing but cement resentment and hostility to the music industry . Music sales still fall and downloading still rises. The proposal, currently under discussion, may help the film industry avoid considering new business models and ways of operating in the short term, but it also entrenches an us-vs-them attitude and hardening the resolve of pirates while inevitably forcing ISPs to put up their costs, alienating consumers. And what too of shared networks and free-wifi - will public libraries, bars, cafes and National Express trains (and indeed my own house) have to turn off open access for fear that someone somewhere will be using the bandwidth to download something illegal, forcing the ISP to shut down access for all? Potentially terrible PR for the film industry, at a time when survival seems pinned on building a positive relationship with audiences.
I'd also argue that the jury is still out over the impact of piracy on lower-budget, niche and independent films. Some would say that it acts as a 'try before you buy' on high-risk / high-quality films with unknown actors and directors - ie non-studio films. Researching and writing one of the first major market reports into making money from creative assets in the digital age, for Informa in 2001, and watched the shifts ever since, including the huge DRM backlash, and the massive increase in previously unknown MySpace (etc) acts who rise to prominence through giving their music away for free, not to mention Radiohead's highly successful experiment and Four Eyed Monsters, I'm inclined to agree that at a certain level, peer-to-peer sharing is a useful form of marketing. Little Miss Sunshine was widely available to download and watch online through sites like PeakVid and Alluc, yet people I know who first watched it online went on to buy multiple copies - for themselves and friends as gifts.
The people who stand to lose the most in cash terms are perhaps the studios with major tentpole releases, where losing 30% of DVD sales to piracy on say Lord of The Rings, is a significant sum of money when you consider it has made $6bn... (cont.)
But if the government is not to bully New Line into paying the Tolkein estate the 7.5% in royalties it is owed (they so far have not been paid one penny from the films' success), then why should it force ISPs to rewrite the fundamentals of the Internet, closing down open wifi in the process? The double standards of the industry here will not be lost on savvy consumers - as Richard Dreyfuss famously said "so the guys who started this business all cheated somebody to get there, and now they're being cheated, perhaps, by all these crazy, geeky people all over the internet. I must say, my anguish level is not great."
Faced with massive losses to piracy, the software industry did not seek the end of the CD writer, any more than the publishing industry sought to take photocopiers out of public use. Piracy is as inevitable as a contract loophole from a media lawyer, and great effort and ingenuity is needed from the film world to shift from a pre-binary business model, to one in which everything can be copied and exchanged instantly, yet people still, overwhelmingly, want to pay for special things from people they trust, which they can own and give away. Going to war with the public, effectively choosing the stick over the carrot, has rarely - if ever - done anything but make things worse.
Images on this article from Tanakawho's Creative Commons photoset on Flickr