Category: Digital Economy Bill

Musing about unheralded heroes and heroines and accidental criminals and IPR

I love Auden’s poetry. I have particular fondness for The Unknown Citizen (or JS/07/M/378, the reference Auden gave to him), so much so that I tend to recall the closing lines of the poem almost weekly in one context or another:

 

Was he free? Was he happy? The question is absurd:

Had anything been wrong, we should certainly have heard.

 

Unknown citizens have fascinated me for decades. The amateur historian in me has a peculiar bent: I’m fascinated by stories of people whose impact on our lives is belied by their relative obscurity, people whose fifteen minutes of fame changed the course of a tiny part of history, while being largely forgotten by history in general. Take Tank Man for example.


Twenty-three years on, we still don’t know his name. We don’t know if he’s alive or dead or where he is to be found. History isn’t good at remembering people when you don’t know their names.

At least Tank Man knew what he was doing.

Sometimes (some would argue I should use the word “Often” here) people have their impact on history accidentally. Take William Huskisson for example. Statesman, Privy Councillor, MP for multiple constituencies, we remember him principally for being the first person to die in a railway accident: he was run over by Stephenson’s Rocket, and died despite being taken to hospital by Stephenson himself. Now there were people who died in railway accidents before that, but they weren’t the ones to make the news.

My passion for unheralded heroes started in a strange way. As a young boy, I was fascinated by what we then called “general knowledge” or “quizzing”, and as a result had amassed a vast quantity of “useless” information by the time I was 18. It all began with the story of Denise Darvall. You see? I’ve just proved something to you.

Most readers will be familiar with the name of Christiaan Barnard, the surgeon who performed the world’s first heart transplant. Some may even remember the name of Louis Washkansky, upon whom Barnard operated.  A few will remember that the operation was carried out by Barnard at the Groote Schuur hospital in Cape Town. Even fewer will remember that the operation took place on 3rd December 1967.

But who remembers Denise Darvall?

Denise Ann Darvall was the donor of the heart used by Barnard. A 24 year old killed tragically earlier that very day, run over by a drunk driver while she was out shopping for cake. A true accidental heroine, largely forgotten by history.

I could go on and on, but won’t. As you can probably see, I’m fascinated by stories of accidental and often obscure heroes and heroines, how history picks a random few up and puts their names up in lights, yet leaves unnamed and forgotten the many others involved. Every invention, every political event, every scientific idea, has its share of heroes and heroines, often unnamed, sometimes accidental, always obscure.

Sadly there is now a new branch of accidental and obscure for me to study.

The accidental criminal.

I’ve been concerned about digital rights management and intellectual property rights for some years now, deeply concerned. Those concerns rose to the fore during the infamous Digital Economy Act, a process with the singular, perhaps unique distinction of sullying and besmirching the reputations of politicians involved, in all three major parties.

Those concerns are now growing.

This, despite the relatively balanced and even-handed approach to intellectual property rights taken by Professor Ian Hargreaves in his report, commissioned by Prime Minister David Cameron. If you haven’t read the report, please do.

Why am I more concerned?

Firstly, because outcomes often tend to be disconnected to what the commissioned report said: we’ve been here before, as I document here. We’ve had consultations and discussions and reports aplenty, all saying largely sensible things, only to find that what actually happens has very little to do with the reports and recommendations; instead, it appears to be based on narrow, biased lobbying.

Secondly, this lobbying tends to be based on very questionable numbers, again something I’ve written about before in Numbers of Mass Distraction. Don’t believe me? Why not read what the US Government Accountability Office has to say on the subject?

Thirdly, the objective of the lobbying tends to be to enact law that is focused on getting the “low hanging fruit” of the accidental downloaders, the unaware, the weak, the unwary. Why? Because it’s easier to bully them.

I’m not here to defend karaoke-loving grandmothers convicted of illegal downloading. I’m not even here to defend grandmother 83-year old Gertrude Walton, sued by the RIAA in 2005. [At least her defence was impeccable. She didn’t just not have a computer, she’d died some time earlier.]

What I am here to do is to ensure that you understand what’s going on.

But more important than all this is the fact that a very questionable industry practice has been spawned, with very questionable practices. The ambulance-chasers of the IP world, nakedly going after, threatening, seeking to criminalise, the unknowing, the weak, the unaware, the unwary. A practice that needs to be looked at very carefully by all governments, in terms of what they do and how they do it.

Which is why I found this paper on the subject, by Kalika Doloswada and Ann Dadich, refreshing, interesting, an unexpected ray of hope. Please read it.

Some of their key takeaways:

  • The preferred vehicle to prevent illegal downloading is litigation, but there’s scant evidence of this working.
  • Where there is litigation, there’s scant evidence of the monies collected making their way to the creators.
  • Technological advances: closed private networks, IP blockers, identity obscuring tools, anonymous file-sharing networks, encrypted systems: make it hard to get to the IT-savvy, particularly the IT-savvy with criminal intent
  • Despite all this, the preferred mode of the ambulance-chaser is to go after, and to criminalise, the low-hanging fruit of the unaware, the unwary, the unable to defend.

I have over 2000 CDs. I’ve paid through the nose for all of them. I own the vinyl for a hundred or two of them, and have owned (and left behind in India) many more.

I have owned hundreds of cassette tapes, all pre-recorded.

I’ve never taped off the radio, copied someone else’s vinyl on to tape, or downloaded something illegally.

I thought I knew the law. Yet I may have repeatedly broken the law (apparently!) by buying a CD and transferring its contents on to ITunes over the years. As the Daily Mail says here:

People like Terry Fisher and Charlie Nesson over at the Berkman Center have been pushing for alternative ways to resolve the publishing/copyright/IPR impasse for some years now. People like Cory Doctorow over at Boing Boing have been writing about for years.

It’s time we all got involved: otherwise we’re going to get the future we deserve, with schoolyard bullies using questionable tactics, data and processes to go after the weak.

More importantly, as a result of the lobbying by these people, we’re going to destroy the ability of the digital world to live up to its promise: in education, in healthcare, in welfare, in government, and in business as a whole.

The lawmakers who allow all this to happen (DMCA, ACTA, DEA, Hadopi, et al) will make more bad laws and move on.

The lobbyists who use questionable data to influence the lawmakers will make their money and move on.

The cowboy firms that collect monies through threats and fear and because of the ignorance of those they prey on will make their money and move on.

The industries who need to change will have staved off change for a short while as a result.

Then everything will change. The laws will change. They must change. Because the law does not remain an ass for long.

But criminal records are forever.

Learning from my children… and Radiohead

I’m blessed. I have three children, born early 1986, late 1991, mid 1998. There is so much I learn from them.

My daughter, the eldest, told me all about Facebook in 2004, and even became my first friend there after I received an invite from Dave Morin, now at Path. Before that I’d done things like watch her converse across multiple MSN Messenger channels in parallel (forcing me to have Microsoft in an Apple-only house!), seemingly while doing her homework and while watching television. It reminded me of the time she was just a few years old, watching TV while reading while eating while playing with toys. I would gently walk over to the TV with the intention of switching it off, only to be stopped by a plaintive “Dad, I’m still watching it”. She was three when the web was written about, five when it became real. And it was a joy to learn about the web through her eyes, the sites she visited, the sites she knew about, the tools she used and why.

She was about 14 when she got her first mobile phone, to give you an idea of how long ago it was. Imagine a 13 year old without a mobile phone now. And SMS was in her DNA, all the way from the start. [While I can’t take credit for it, I do love the definition: “A teenager is someone who can send a text message without taking her phone out of her pocket“]. She was extolling the powers of eBay and YouTube to me before she was old enough to have a credit card. And her choices of phone were (in chronological order) Nokia, Motorola and Samsung. She now has an iPhone.

She’s now a schoolteacher, and it’s a real privilege for me to learn, by watching her and talking to her, how teachers use the web to build their class and course plans and material. A few weeks ago, when she was visiting us, I had the chance to observe her at work in the living room, preparing her material while the TV was on in the background, and it all came flooding back.

Next up was my son, who was less about Facebook and more about Bebo, as social networking did its Benjamin Button thing and went younger. And skateboarding. And cameras. So the sites he took me to were different: it was through him that I discovered places like daily dose of imagery and metacritic, as examples.  His first phone turned up when he was about 12, and his choices were different. Nokia to begin with, Samsung soon after (influenced by camera quality), and then settling with the Nexus One. Android is very important to him.

And then came my youngest, and she introduced me to stuff like Stardoll and Club Penguin, as social networking went younger still. This had its dark side: as the age by which children engaged with such technologies dropped, there appeared to be an unwelcome consequence, that of increased cyber-bullying. So my wife and I found ourselves having to learn about the dangers of formspring and “underage” facebook, a hard time to be parenting. Nothing in our past prepared us for the environment; yet we had two advantages, the older children, there to advise and guide us while not interfering or participating themselves. Parenting was our job, not theirs.

She was 10 when she got her first phone, and it was an iPhone. A hand-me-down. From me. She stayed with that for a while, and then, exactly as predicted by my old boss Ian Livingston at BT, she went all “BBM” on me and insisted on a BlackBerry. [A couple of years ago, as the first commercially available Androids were coming out, and I was telling Ian about the preferences my son had shown, he’d predicted that the next child would be a glutton for BlackBerry Messenger, given her age. He was absolutely right.]

During their lifetimes I have seen the fat TV disappear completely, the CD become a shiny plastic relic to place in the same category as “desktops”,  the mobile phone become a prosthetic device, and the laptop a fashion accessory. Their facility with sound and picture and video, the ease with which they navigate cyberspace, the way they put all this to use and create value from it….. all reasons to make a dad’s heart sing. Of course I’ve had to learn about how to help them combat fraud, how to avoid going to the wrong sites, how to protect their privacy. But largely they’re the ones doing the learning and the teaching, not me.

Except for one or two things. Many children seem to believe that printers get cartridges replaced and paper restocked the same way clothes fly off floors, get washed and ironed and turn up in their bedroom wardrobes. Something needs to be done about this. But that’s a different post.

Where was I? Oh yes, learning from my children. Today my son came to me to tell me about the latest Radiohead album, and to ask whether we can order it.

So we went to the site, pictured below:

EMI may be in trouble, the dinosaur BPI and IFPI may bleat and rant about Numbers of Mass Distraction, but, despite all that FUD,  there is still a lot to like about the way the music industry is going. Because some people are really trying to do things differently. [Ed: enough with the TLAs, JP!]

Global releases. Simultaneous releases. None of the cowpath-paving regional carving-up of territories or times. All formats in one bundle, without the evil of salami-slice torture thrown in. A distribution process that is in keeping with the modern world, all designed and executed by people who appear to have read Kevin Kelly’s fantastic essay Better Than Free and, more importantly, appear to have understood it and taken it to heart.

Of course there were, and continue to be, glitches.

The site was too busy to take the load 14 minutes after the announcement of the album, brought to me by my son quoting Pitchfork. My order wasn’t going through, I was getting a false “decline”. But there was a way to ask for help, an email address. Which I wrote to. And got a reply forthwith saying that the site was very busy, the “decline” was likely to be a function of that volume, and that I should try again in a few hours. Which I did. Successfully.

I’m not a fan of cookies, and bristled at being told “in order to buy any product you must have cookies enabled”. But I could live with it, in the expectation that things will get better.

I had to pretend that I lived in China, just to see what happened. Nothing. If I clicked there I went precisely nowhere. Everything just went quiet. Ominous.

The £3 price differential between MP3 and WAV was enough for me to feel “why don’t you include the MP3 in your WAV bundle then?”. But I didn’t make a big deal of it. Radiohead have done so many things right in this venture that I can live with the rest. Not perfect, but continuing, positive proof that there’s a better way to improve the music business than the nonsense engaged in by people like BPI and RIAA.

I hope Radiohead break the record for money collected on pre-order for this album. Pour encourager les autres.

It will show others what is possible, following on from the brilliant work done by people like Nine Inch Nails, and for that matter, Radiohead themselves, earlier with In Rainbows.

In the meantime, I continue to learn from my children. And will remain ever grateful at having been given the opportunity to learn from them

On pasta and music and copyright

I love food. I love cooking. I use the analogy of food to learn about information: in fact, I’ve nearly finished writing a book that looks in detail at information as if it were food. One of the foods I love is pasta. Glorious pasta.

[I’m attributing this to Red Giraffe, though I came across this elsewhere without any attribution.]

Nobody quite knows precisely where pasta comes from, where and when pasta began. The web is a rich resource for satisfying any curiosity you may have on the topic; suffice it to say that most of the stories involve thousands of years, a lot of dead people (usually Greeks, Romans and Chinese) and even the odd saint or two. Marco Polo doesn’t quite make the cut, but that doesn’t prevent the Chinese having a stake in the ground millenia earlier.

Some of the stories are more recent and more enjoyable (albeit slightly less credible) such as this one, harvested from the Alexandra Palace Television Service over fifty years ago:

Some of the stories may be hard to believe, but nevertheless people agree on a number of things:

  • Pasta has been around since the year dot.
  • Pasta is made by mixing ground kernels of grain, usually wheat,  with water or egg; while Italian pasta tends to be made of durum wheat and no other, other types of grain are in use elsewhere.
  • Pasta used to be made by hand (or more precisely, foot); since 1740 or so machines have also been used to make pasta.

[attributed with thanks to Donovan Govan]

Pasta comes in many shapes and sizes and forms; if you’re interested, read the wikipedia article. If you want to delve deeper, there is probably no better book than Oretta Zanini de Vita’s Encyclopaedia of Pasta.

[Attributed with thanks to FoodieSteve’s blog]

Pasta proclamations, even patents, have been around for a long time, perfidious and pusillanimous attempts to pervert people’s creativity. There have even been designers who’ve tried their hand at new forms of pasta:

Giorgio Giugiaro’s Marille pasta

Philippe Starck’s Mandala pasta

Think about pasta. Today, anyone can make pasta. Kafkaesque bureaucracies can make up rules about the nature of the grain used, the water used, the egg, whatever, but basically every human being has a right to decide what to make pasta out of. You can buy machines to make pasta. But you don’t have to. You can buy “readymade” pasta made by someone else, or even try and make similar pasta at home yourself. You can even go to the extreme, and buy not just the pasta but the love and labour that goes into making and serving a dish with pasta: you can go to a restaurant and pay a chef to do that for you, pay waiters to serve it to you.

Basically, you can do what you like with pasta, starting with the wheat and water and ending with the cooked meal. At each stage, you have the choice of whether you want to pay someone else to do something or not. Someone else can make the pasta for you. Sell you a machine to make pasta. Write a book and tell you how to make the pasta. Or the meal itself. Someone else can cook it for you, amateur or professional. There are a million ways people can participate in the design, making, cooking and eating of pasta, a million ways people can make money with pasta.

Wonderful, isn’t it? The freedom and creativity that has given us over 1300 types of pasta over centuries, shared and enjoyed by billions.

But you know something? It would take very little to screw all this up, to make a complete codswallop out of pasta. Imagine this scenario:

  • Step 1: Patented genetically modified durum wheat begins to displace “organic” wheats. Over time, all the durum wheat grown in the world is covered by patent. People continue to share recipes and cook and eat at home, and in restaurants.
  • Step 2: The GM wheat manufacturers do deals with pasta machine manufacturers (also patented, of course). You cannot use the machines except with official durum wheat. [This is called putting the DRM in durum, which then gets trademarked as DuRuM]. People continue to share recipes and cook and eat at home and in restaurants. Some people have the gall to build their own machines, some don’t even use machines; they knead the dough with their feet.
  • Step 3: The pasta and pasta machine manufacture and distribution industry does not like this, so, under the guise of public safety, lobbies and gets legislation passed that outlaws all wheat bar non-GM wheat, as happened for a while with mustard oil in India. While they’re at it, home manufacture of pasta is also banned. People continue to do what they’ve been doing for thousands of years, and the legislation isn’t taken seriously.
  • Step 4: The internet arrives, Moore’s Law continues to march, and the digitisation of the pasta world continues. 3D printing becomes reality. People don’t just share recipes with their friends and neighbours any more, they now use the internet to share recipes with people they don’t even know, people living all over the world. Even worse, people start making their own pasta machines even though this is “illegal”. RepRap pasta machine cells spring up everywhere.
  • Step 5: The pasta and pasta machine manufacture and distribution industry, which had been going so well since the middle of the 19th century, is distraught. They find all this modern technology so unfair, despite the irony that they themselves disrupted an entire industry as a result of technological advancement 150 years ago. So they lobby government for even more law, to declare sharing of recipes illegal, to declare 3D machines illegal, to declare the transport and distribution of such recipes and machines illegal. Up goes the cry, the pasta bandit must be stopped. Billions at stake, millions of jobs lost, all because of the pasta bandits.
  • Step 6: Government is so busy looking for WMD in Iraq, looking through their expense claims, looking for oil, looking for lucrative post-government book deals, speaking assignments and suchlike, that they don’t have time to worry about all this. Their noses may have been deep in the trough, but they know what to do every time they hear words like “bandit”. Bandits? We can’t have them. Thieving uncivilised louts, we need to put a stop to this forthwith.
  • Step 7: And so the pasta “bandit” is born. And over time, five thousand years of eating pasta comes to a halt.

Don’t worry, none of this could happen in a civilised country, we have nothing to fear. Especially in civilised countries like the UK, the USA and France.

Think about pasta. And think about music. Think about laws that require you to take down a home video of people singing Happy Birthday to You. Think about laws that require people’s internet connections to be cut off for alleged acts of music “piracy”, somehow seen as criminal theft while being at best, and that too only if proven sufficiently in a court of law, civil offences of copyright infringement. Think about laws that make it impossible to provide free wifi.

Think about the freedoms that are being traded. Yankee Doodle, as the song says “put a feather in his hat and called it Macaroni”.

Soon we won’t have the right to call anything Macaroni. Forget calling a feather macaroni, at the rate our freedoms are being traded we will soon not have the right to call macaroni macaroni. Not unless it was made out of GM durum wheat made using licensed machines on licensed premises, using officially endorsed recipes.

The Digital Economy Act is not about thieves or bandits. It’s about preserving 150-year-old business models that prevent human beings from enjoying 5000-year-old freedoms.

The Digital Economy Bill: Thinking further about copyright

Image courtesy of Drew Douglas duly attributed here

The photograph above was taken at a rugby league game in Port Moresby, Papua New Guinea, in September 2008. In it you can see young children and older youths watching the game from rooftops adjacent to the stadium.

Tho photograph below, nearly a hundred years earlier, shows fans watching a 1914 World Series game in Shibe Park. My thanks to explorePAhistory for sharing the photo.

Two photographs.  Nearly a century apart. Of people watching a sports game without paying.

The question is, were they stealing? Would you call it stealing? I wouldn’t. But I know some people who would.

People involved in the distribution of published material have tried their best to call such actions “stealing” since the beginnings of copyright. If you really want to understand what copyright is about, what its origins were, then please go and read this excellent piece. It tells you why copyright had everything to do with distributors, distribution and central control and very little to do with authors, musicians and artists. Why it had everything to do with censorship and exclusivity and very little to do with creativity and free expression. In fact, if you get the chance, spend time at questioncopyright.org; there’s some very useful material there, including this video, Copying is Not Theft.

After 9/11, there were people who tried very hard to conflate “Muslims” with “terrorists”. I have many Muslim friends, and none of them is a terrorist.

During Katrina, there were people who tried very hard to conflate “citizen” with “refugee”. Citizens have rights; refugees rely on the generosity of others. The rights of New Orleans citizens were sought to be weakened by the conflation, a technique that  George Lakoff wrote about quite eloquently.

So it is with copying in a digital world. People are trying to make you believe it is stealing. To understand what’s happening, let’s look at the ticketless folk watching the rugby and the baseball from the rooftops.

What are they stealing?

In the same photograph, you can see folks who paid for the tickets watching the game. They’ve paid for the right, and they’re watching the game. The people who sold the tickets make their money, related to the seating capacity of the stadium and the number of tickets sold.

Economists call such “goods” nonrival, to the extent that one person enjoying the good does not detract from the ability of others to enjoy the same good. The people who promoted the games did not incur any costs related to the people on the rooftops. If you can make a copy of something without in any way affecting the ability of others to enjoy that something, economists call such goods extreme nonrival goods. Sunsets and panoramas and views are examples of extreme nonrival goods, as are openair concerts and street theatre.

All these openair events share something in common. They’re in the open. Repeat that. They’re in the open.

People who promote sports events and street entertainment and openair concerts understand this. They know that as a direct result of their actions, others will be able to enjoy what’s happening. For free.

They can stop this. Very easily. By not using open spaces to do this. If they moved openair concerts to closed venues, the possibility of others freeloading diminishes. This open-to-closed spectrum is a continuum rather than a set of discrete outcomes. So, for example, you can build walls around openair venues, as happens with Kenwood. I have paid for, and enjoyed, many concerts at Kenwood, in the wet and in the dry. This summer my children will be going to concerts in Reading, and they will have paid for the tickets. Passers-by will be able to hear the music, but nowhere near as well as people sitting in the roped-off areas.

Shibe Park, in Philadelphia, decided to do something about the onlookers. So they built a bloody great wall around the stadium. Shame, but that is how some people think.

This summer, there are a few concerts taking place around Hyde Park, with tickets and with reserved areas. Can you imagine how it would be if the promoters managed to convince the Crown that a 16ft wall should be erected all around the park, just so passers-by won’t be able to catch glimpses of the concerts?

In a way, that’s what music and film distributors want to do with the internet. Like Hyde Park, the internet is a commons, something that has been designed with openness and sharing in mind, something that can be enjoyed by people without detracting from the enjoyment of others.

But only if we stop people from erecting hideous walls around the commons.

The Digital Economy Bill seeks to do this. And it’s worse than that. Because it seeks to protect and enhance distributor rights while actually damaging the rights of consumers and creators in many walks of life. Photographers, for example, are heavily affected. Just read Kevin Marks here and Simon Phipps here, or go to Open Rights Group to find out more about what you’re about to lose.

Think about this. If internet copying was really stealing, then there would be an active disincentive to produce digital works. Yet, in the apparent heyday of internet copying, every form of digital publishing is on the rise. There are more books being written and published, more films made, more albums released. Why would this be? Looking for that answer, I spent some time with Paulo Coelho some years ago:

I wanted to talk to Paulo for one simple reason: I’d heard rumours that the biggest pirate site for Paulo Coelho books, Pirate Coelho, was actually paid for by Paulo Coelho. In fact that has since changed: Paulo now hosts them in a subdirectory of his own blog, here. An author who pays others to rip him off? I needed to talk to him.

His answer is best understood in this statement from Wikipedia: In total, Coelho has sold more than 100 million books in over 150 countries worldwide, and his works have been translated into 67 languages. As an author, he wanted to reach as many people as possible, particularly in different cultures and geographies. His publishers had their way of doing this. His fans had a better way.

The internet, with its extremely low cost of copying and distributing things digital, transforms the access and distribution landscape for many industries. Its effect is felt most painfully in the publishing industries: music, film, journalism, books. The pain is at its most intense for those whose function with the industry was centralised control of distribution.

I work for a telco. Before that, I worked for an investment bank. Some time before that, I worked for hardware manufacturers with proprietary operating systems. All my life I’ve been working in industries where the core monopoly rights of the industry have been taken away by technological advance, often aided and abetted by regulation.

Regulation is first and foremost meant to protect customers, to protect the consumer. It does this in many ways, at least one of which is in preventing monopolies and reducing any significant market power.

When it comes to music, film, books and journalism, things become very complex. It’s like having a fire in the fire alarm system. The very people charged with telling you the truth about what’s happening are themselves affected by what’s happening. Which means that with a few exceptions, mainstream media have not woken up to the wholesale damage being planned by the Digital Economy Bill.

Let me end with this. Copying per se is not stealing. After Michael Jackson did his moonwalk, children the world over copied him. They were not stealing. Digital forms of music, film, book and newspapers are cheap to copy and to distribute, because of the internet. The internet is a commons, specifically designed for doing this. For copying and distributing. Throwing that away just to protect the “rightsholders” is questionable in the extreme. Digital assets are nonrival goods, shareable without affecting the rights of anyone else to enjoy the same thing.

  • Distributors of digital content are feeling the pressure, and some are using questionable techniques to lobby Government into acting.
  • The data on illegal downloaders is suspect, as is the claimed revenue losses. Price elasticity of demand is not adequately allowed for. It’s like saying kids on the rooftop would otherwise have paid for tickets to watch the rugby. Just not true.
  • The people involved in the process are suspect, largely unelected, and with clear bias supporting the very industries under threat. [This is a bit like placing an investment banker at the head of Treasury and asking him to solve the woes of financial markets. Oops.].
  • The democratic process itself is being subverted, lobbyists are seeking to ensure that the Bill is not properly debated in Parliament before being passed. To me this is more criminal than anything the Bill seeks to prevent.
  • The punishments suggested are technically complex, expensive, time-consuming and guaranteed to fail. They will waste a lot of time and expense, your time, your expense. Our time, our expense.

We have very little time to act. So please please get going, write to your MP, call her up, meet him, do something. Start off with reading this, make sure your voice is heard.

The Digital Economy Bill: Be Careful What You Wish For

Do you find it easy to be moderate about things? It’s taken me a long time to learn about moderation, about knowing how to leaven and temper my passion with patience. For most of my life I’ve been an extremist, either full-on about something or not at all engaged. As a result, particularly of late, I’ve had to take time to learn one thing: If you feel really passionate about something, take the time to step back and look at things from the opposite perspective.

Now the Digital Economy Bill is something I feel passionate about, which is why, as we approach Tuesday 6th April 2010,  I’ve been writing a post a day on the subject for the past few days. The Bill covers a litany of subjects; the particular bit that bothers me is to do with the treatment of downloaders, the what, the why, the who, the how, the whole shooting match. As far as I’m concerned, I feel that the premise is wrong (illegal downloading does not take place at the levels claimed); the people are wrong (the Bill is being pushed through by unelected people who have clear bias in favour of “rightsholders”); the process is wrong (such an important Bill should not be finagled through parliament without proper debate) and the punishment is wrong (as BT CEO Ian Livingston pointed out recently, a fine is more appropriate for the crime, it’s easier to administer and it does not affect others in the household).

Notwithstanding all that, let me try and look at this issue from the perspective of the “rightsholder”. In fact let me go further, let me look at it from the viewpoint of the rightsholder after the Bill, in its current state, has become law. Ostensibly as happy as a creature of the porcine persuasion in an environ of excrement.

What could possibly go wrong? Let me count the ways:

1. People stop downloading all digital music, not just “illegal” music

Retaliation: The music industry, particularly through organisations like BPI and IFPI ,has spent a long time telling its customers what rotten people they are. In the latest report issued by Ofcom, the country had around 17.3 consumer and small business broadband lines; which suggests that a very high proportion of digital music customers acted illegally. Irritated by the change in law and by being treated like criminals, people may just give up and stop downloading music altogether, legal as well as illegal.

Fraud: Given the level of internet fraud going around, people may not want to take the risk of losing their broadband connection by buying music in good faith from a pretend-legal site. When they buy anything else, they tend to get their money back from the credit card company. When buying music, even in good faith, they run the risk of losing their broadband connections. So they stop buying music online altogether.

Streaming: Man’s ability to record and replay music is itself less than 150 years old. Newer than the postage stamp, newer than the locomotive, newer than the Grand National, newer than the FA Cup. By British standards, recorded music is a mere stripling, a callow youth. Man’s ability to own the recorded music and retain it for personal enjoyment is even newer, it hasn’t been there that long. And it may not be in vogue for long either: there is a growing body of evidence that the Millenials prefer streamed music to owned music. My own habits have changed. I still buy vinyl, but in dribs and drabs. I still buy CDs, but also in dribs and drabs. For the most part, I use services like Spotify.

So whether it’s frustration or fear or a change of habit, people may use this opportunity to stop downloading altogether. Since digital music sales are reported to be booming, the industry runs the risk of killing the baby goose before it really has a chance to lay any golden eggs.

2. People stop downloading music illegally, but there is no materially positive impact on revenues

Download levels estimated wrongly: The Mandelson 7 million figure turns out to be hogwash. [And, like Churchill, I shall resist the temptation to say I told you so]. So even though everyone behaves legally when it comes to downloads, the market uplift just isn’t there. [ I am so tempted to ask that, in the event of the law being passed unchanged, the music industry is asked to put down 15% of the loss figures it has claimed into escrow in advance,  to pay ISPs for the cost of implementing the technical solutions].

High price elasticity of demand: The pirated downloads might have been real, but there is greater price elasticity of demand than was anticipated by the industry. Rolex watches sell for thousands of pounds. Rolex ripoffs sell for tens of pounds. No one in Rolex honestly believes that the customer who paid a tenner for a ripoff was a real contender for paying five hundred times that for the real thing.

The end of try-before-you-buy dampens sales: There is evidence that people who download music are also the ones who buy digital music. After all, they must have the connections, the access and the equipment in the first place. By being denied the chance to try the music out, they may not buy at the levels they used to. So any uplift in digital revenues via the change in law is compensated and balanced by a drop in the revenues that used to be there.

It is one thing to lay out a whole series of “facts” in order to browbeat busy politicians to do something; it is another altogether to expect that those “facts” become real in the process. In this respect, the Digital Economy Bill may turn out to be a case of shutting the stable door after the piglet has bolted.

3. People stop buying from established labels and channels and move to new, independent channels that offer them what they want

In a fascinating study entitled The State of Music Online: Ten Years After Napster, the Pew Research Center makes the following, telling,  observation:

While the music industry has been on the front lines of the battle to convert freeloaders into paying customers, their efforts have been watched closely by other digitized industries — newspapers, book publishing and Hollywood among them — who are hoping to staunch their own bleeding before it’s too late. And if the music market is any indication of how consumer expectations will evolve elsewhere, the demands for free content will extend far beyond the mere cost of the product.

In the decade since Napster’s launch, digital music consumers have demonstrated their interest in five kinds of “free” selling points:

  1. Cost (zero or approaching zero).
  2. Portability (to any device).
  3. Mobility (wireless access to music).
  4. Choice (access to any song ever recorded).
  5. Remixability (freedom to remix and mashup music).

All of this makes for a tall order, but if history is any guide, music consumers usually get what they want. And as researchers look back on the first decade of the 21st century, many will no doubt point to the formative impact of file-sharing and peer-to-peer exchange of music on the internet. Napster and other peer-to-peer services “schooled” users in the social practice of downloading, uploading, and sharing digital content, which, in turn, has contributed to increased demand for broadband, greater processing power and mobile media devices. Further, the Napsterization effect extends to non-media areas such as sharing health information, oversight of politicians, access to government data and online dating via free social networking sites.

Remember this is about digital music consumers, not “dirty rotten illegal downloaders and filesharers”.  The people who crafted the current version of the Digital Economy Bill appear to have thrown away all the input and consultation to do with the consumer side of the music business and concentrated on the “rightsholders”. [I suppose this should have been expected, since that is the precise problem with a lot of modern copyright law, too one-sided to be useful or progressive]. Consumers want the five things stated above. If they don’t get it from the established digital music industry, they will go somewhere else to get it. Which gives independent labels and new entrants the chance they’re waiting for, to drive a bus through the barndoor of opportunity that’s opening up for them. Artists have the opportunity to set up their own label and distribution capability, like the Grateful Dead did nearly fifty years ago. There are many who are watching and learning from the Dead, from Radiohead, from Nine Inch Nails, and so on.


4. Content is not king: simplicity and convenience rule

There was a very interesting article published by Andrew Savikas in the middle of last year, talking about content being a service business. In it he quotes from Trent Reznor of Nine Inch Nails:

[W]hat you NEED to do is this – give your music away as high-quality DRM-free MP3s. Collect people’s email info in exchange (which means having the infrastructure to do so) and start building your database of potential customers. Then, offer a variety of premium packages for sale and make them limited editions / scarce goods. Base the price and amount available on what you think you can sell. Make the packages special – make them by hand, sign them, make them unique, make them something YOU would want to have as a fan. Make a premium download available that includes high-resolution versions (for sale at a reasonable price) and include the download as something immediately available with any physical purchase. Sell T-shirts. Sell buttons, posters… whatever. [emphasis added]

Reading through what Reznor had to say in his original post, I found another extract telling in the extreme:

The database you are amassing should not be abused, but used to inform people that are interested in what you do when you have something going on – like a few shows, or a tour, or a new record, or a webcast, etc.
Have your MySpace page, but get a site outside MySpace – it’s dying and reads as cheap / generic. Remove all Flash from your website. Remove all stupid intros and load-times. MAKE IT SIMPLE TO NAVIGATE AND EASY TO FIND AND HEAR MUSIC (but don’t autoplay). Constantly update your site with content – pictures, blogs, whatever. Give people a reason to return to your site all the time. Put up a bulletin board and start a community. Engage your fans (with caution!) Make cheap videos. Film yourself talking. Play shows. Make interesting things. Get a Twitter account. Be interesting. Be real. Submit your music to blogs that may be interested. NEVER CHASE TRENDS. Utilize the multitude of tools available to you for very little cost of any – Flickr / YouTube / Vimeo / SoundCloud / Twitter etc.

The key phrase for me is this one: make it simple to navigate and easy to find and hear music.

When I read the Savikas article, one of the points I understood was this: the success of iTunes lay in the quality of the service they offered, the simplicity and convenience, rather than in premium content. In fact, the pricing of digital goods tends to reflect this: prices for songs, albums, films and books tend to be very similar for a given class of digital good, suggesting that the content behaves like a commodity, that the perceived value is in service simplicity. When you take into account recent developments such as Ofcom’s stance on Sky’s exclusive premium content, there is every possibility that there’s going to be downward pressure on the prices of premium digital content.

So let me summarise. I don’t know much about  how the world is changing as a result of the internet and the web, as a result of digitisation. What I do know is this: these changes are putting real structural pressure on a number of industries, particularly on the “publishing” industries of music, film, journalism and books. Every participant in the supply chains of those industries is feeling that pressure.

During such a time of flux, the customer becomes even more of a scarcity, even more of an asset. Any action you take which alienates customers, you take at your peril.

In this context, the actions of the music industry at this time, particularly in the context of the Digital Economy Bill, seem foolhardy in the extreme. Foolhardy enough for shareholders and activists to look at the consequences very carefully, and to take legal action against the decision makers.

You know something? If I was one of those people who’d lobbied to put all the garbage in the Digital Economy Bill, I would start praying. Now.

And I would write to my MP and ask that the Bill be withdrawn. Even if I worked for the BPI. Particularly if I worked for the BPI.

Sometimes it pays to Be Careful What You Wish For.