David Stoughton of ValueKinetics writes:
Yesterday a Swedish court not only found four founder members of a file-sharing web site, The Pirate Bay, guilty of breaching copyright law, it sentenced them to jail. That came on top of an award for damages of £3 million. Never mind that the name was a red rag to the raging bull that is the collective recording industry, this case was important.
Among representatives of the industry delight is unconcealed. They are anxious to convey the impression that a decisive landmark has been achieved. "There has been a perception that piracy is OK and that the music industry should just have to accept it. This verdict will change that," said John Kennedy, chairman of industry body the International Federation of the Phonographic Industry (IFPI).
There is no doubt that, in this case, the rights of the entertainment companies were upheld and existing copyright laws vigorously asserted. Why then do I, perversely, see this as another nail in the coffin of the record companies and a setback for media industries in general.
There are three reasons why I hold this view. They range from the general, concerning all businesses affected by the the outcome of this case, to the particular, the recording companies themselves.
The first has to do with copyright law itself. The music industry is not the only, or even the major, business sector affect by its provisions. Whatever the rights and wrongs of recent breaches, a general consensus seems to be emerging that, in its current form, the law (especially as it applies in the UK) is not fit for purpose. Not only is it increasingly hard to enforce, and thus falling increasingly into disrepute, there is a growing understanding that it might actually be reducing access to creative works - the precise opposite of the intention of the law - and inhibiting the commercial exploitation of those works. This "victory" will set back the campaign for its reform and give those, like the music industry, who see themselves as - by definition (theirs) - the losers from any change, an argument for delay. The longer this drags on the greater the damage to wider interests, cultural as well as commercial.
The second concerns the interests of the broader music community. While the record companies have been suffering, much of the rest of the industry has been doing just fine - in fact many artists and their managers have been in clover. This is partly a consequence of more frequent concert appearances, increased concert fees, and growth in the associated businesses like merchandising - benefits not unrelated to the added exposure that unconstrained dissemination of recordings delivers. It is also a result, I would argue, of a more general increase in access and opportunity for all, including newcomers. In fact the emerging business models in the industry are predicated on exposure - on as wide a dissemination as possible of the artists' work. In that sense what file sharing may take with one hand it returns at least twofold with the other. The idea that music should once again be corralled into tightly policed outlets, where access is controlled by the record companies, might sensibly be viewed with some horror by other players in the broader community.
And it isn't just about exposure. Since the means of distribution changed, music means something different to, and is used differently by, its audiences - who are also more active participants in the creative act. Turning the clock back (if that were possible) would necessarily change that as well, with - I can't help feeling - generally negative consequences for the artists and for musical creativity general.
The final reason, specific to the recording industry itself, is one I've harped on about before. It's not unhelpful to envisage the industry as split into two camps with, as you would expect, some in the middle who'd like to see a bit of both. The realists, who - until this setback - might have been gaining the upper hand, accept that everything has changed and that, as a consequence, the core business model must be revisited and new sources of revenue identified urgently. The other camp (I'm stuck for a non-pejorative name) believe that, essentially, nothing has changed except that the public - given the opportunity - has proven less law abiding than they had a right to expect. Impose the law properly and business as usual can be resumed.
Any change manager will tell you that successful change requires a 'burning issue', something all parties agree is so important it cannot be ignored, and that requires them to do something different to address it. Until yesterday that burning issue was becoming indisputable - historically reliable sources of revenue were under increasing threat and real changes in strategy were required to meet the challenge. It doesn't take a lot of imagination to realise that, once it can credibly be affirmed that all that is really needed is that the law be properly enforced, the flames are immediately doused. "It's them what needs to do their job, not us what needs to change" is likely to be the death knell of an industry that, by these standards deserves to die. The tides of history are sweeping in faster after yesterday - Canute may, perhaps contrary to his intentions, have manage to convince his courtiers that the waters can be held back, and so that defenses are not required.
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