Warner pushing for a compulsory music tax through ISPs
When everything else fails, why not turn to tax. Which is exactly what Warner Music and others are contemplating in a last ditch attempt to save the dead business model which they are desperately clinging on to.
The music industry has been fighting a losing battle for years now, against piracy, and against the majority of the world’s population who are making it clear that something needs to change, the old model is not acceptable any more.
From the moment the Internet started being used for more than just porn, and Napster was formed, there’s been a battle raging between what the music industry wants, and music loving consumers want.
The music industry has already killed Napster, rather than using the service to its advantage, and then launched a nasty little war against consumers using the RIAA as cannon fodder. Now it’s proposing a compulsory music tax to be paid through ISPs.
The concept is nothing new, with Michael Arrington at TechCrunch explaining that Peter Jenner and Trent Reznor, amongst others, have already argued the case for it, but this time, it’s a record company which is seriously discussing the possibility.
Warner Music has employed Jim Griffin to push the idea of a compulsory monthly tax on to the rest of the industry, and then consumers themselves.
Griffin gave an interview to Portfolio magazine and explained how he sees the industry at the present time:
“Today, it has become purely voluntary to pay for music,”
“If I tell you to go listen to this band, you could pay, or you might not. It’s pretty much up to you. So the music business has become a big tip jar.”
The plan is simple: Consumers will have to pay a monthly fee, bundled in to their Internet service charge, which will allow them access to a database of all known music.
The tax, because that’s what is basically amounts to, would be $5 for everyone, which would amount to $20 billion a year to be split amongst the record labels and artists. Not a bad figure when you learn that the current music industry is only worth $10 billion annually.
The problem with all this, as well as the obvious backlash against this so-called “compulsory license”, is that if every artists is guaranteed a share of the industry’s profits, where does that leave the need for innovation and creativity?
The music industry is already awash with too many sound alike acts who only exist to make money (because record labels know they will sell units), rather than innovate and push the envelope. That will surely only get worse if this plan ever comes to fruition.
There’s no doubt something has got to change on a big scale, or the music industry will find itself no longer an industry, but a disparate collection of independent labels and artists striking out on their own. But I think a tax is completely the wrong way to go about saving their own bacon, and it clearly smacks of desperation.
Related Posts:
March 29th, 2008
There have been proposals for a tax on Internet service in Canada in the past couple of years coming from songwriters’ rights holders groups. The tax was supposed to help compensate the poor starving songwriters’ from the piracy of ignorant Internet users. This latest announcement from Warner Music is just a tax to compensate the poor recording companies.
March 29th, 2008
There is a tax already in Canada, a 100 pack of blank CDs cost two or three times as much as what it does in the U.S. Because of this supposedly people don’t get in trouble for downloading in Canada.
So say Warner gets their $5 or whatever per month surcharge. What about Sony, BMG, Universal, EMI and all the independents. Now you are talking about a $ 25 surcharge at least. I can’t think of a faster way of killing the internet than a $20 to $30 surcharge.
Or will $5 cover everything and all labels? And for how long before another “increase”? Will the industry really go along with this? So if this ever does go in effect… will P2P like Limewire and Kazaa be legal ?
Sounds like a pipe dream as the industry will never agree to it. Too many unanswered questions. This should have been proposed in 2000 instead of shutting the original Napster down.
April 23rd, 2008
1st off p2p is not illegal its the content being shared thats illegal from childporn to copyrights why do people always assume p2p is illegal because of a few bad apples in the bag so to speak i read in other articals that this will cover there works on p2p its a collective licence all you can eat for 5 bucks a month !
June 24th, 2008
Wow Steve…a bit of punctuation in there, the occasional capital letter and I might believe you’re more than 12 years old and take you seriously. Honestly, how is anyone supposed to make sense of such confused rambling?
As for the tax – it won’t happen. And even if it were to happen, that would only be in the US. Would every record label try to push for the same sort of tax in every country that listens to music? It’s completely unworkable.