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PRS Publishes Paper on Filesharing

Posted by Andrew at 3:59 AM on July 23, 2010

The Performing Rights Society (PRS), the approximate equivalent of the US’s RIAA, recently published a paper outlining a proposed approach to the compensation of rights holders based on the level of unlicensed material passing through an ISP.

 The paper, snappily titled Moving Digital Britain Forward Without Leaving Creative Britain Behind, was written by Will Page, Chief Economist, PRS for Music and David Touve, Assistant Professor of Strategy and Entrepreneurship at Washington & Lee University.

(I’m actually not sure that I can tell you about it, because if you follow the links from the press release, it says in bold letters, “It is provided for the information of the intended recipient only and should not be reproduced or disclosed to any other person without the consent of the PRS for Music PR department.  So if it was mentioned in a publicly available RSS feed, does that make me an intended recepient or not?)

Moving on, the paper proposes the following argument, and I paraphrase, because there is unlicensed media, the level of unlicensed media within an ISPs network should be measured and remedial action taken.

The paper offers three possibilities for the “remedial action taken” against the ISP.

  • Compensation, but it admits that it’s difficult to find a way to price it correctly.
  • Licensing or levy, although broadly similar in effect, are very different legally.  There’s a table in the paper showing the differences.
  • Traffic regulation, with penalties or fines paid by the ISPs.

All of this is against the ISP rather than the individual user of the unlicensed media.  Presumably they’ve given up going after the end user because it’s clear to everyone that there’s just too much filesharing going on and it’s going to be easier to go after the ISPs to get money.

However, to be fair, the last two pages of the paper discuss the pros and cons of the three options, none of which are perfect.  One paragraph points out, “We want to make it clear that neither of the above-mentioned options could be considered without accepting that some sort of market failure has occurred and that in consequence some form of regulation is required, and that regulation should seek to put incentives and structures in place so that a market-based solution to the value of media on networks can evolve.”

I’m in a bit of a dilemma over this.  On one hand, part of me has sympathy with the rights holders and believe that they should be compensated fairly (we’ll leave the arguments of whether the PRS and RIAA actually work for the rights holders out of this for now) but the other part of me, says that the success of digital music stores, such as iTunes and Amazon MP3, shows that if you offer fairly priced music and a slick user experience, then people will pay willingly.

Again, I would like to think that mature language and reasoned approach are about the music industry becoming a bit more grown-up and finding fair solutions, but actually it’s just fancy words about getting the ISPs to pay up one way or another.  Those of us who don’t engage in illegal file sharing will simply end up paying for those that do.

Is this the way forwards?  What do you think?