Protecting artists

The recording industry and the Motion Picture Association of America believe that going after illegal file-sharers is not protection enough for their copyrighted material. They are sponsoring and supporting a new bill that would move responsibility for illegal file-sharing to those who provide the means for doing this: internet service providers, computer manufacturers and system software developers. Their argument is that by making ISPs and computer makers liable for illegal file transfers, there will be greater protection for artists who will then be encouraged to create more art; developers of other types of intellectual property will likewise be better protected.

The Inducing Infringement of Copyrights Act of 2004, known as the Induce Act, would hold any individual or corporation liable for infringement that "intentionally aids, abets, induces or procures" copyrighted material for illegal use. Mitch Bainwol, chief executive of the Recording Industry Association of America, wrote in a letter to the Senate that "the need for the bill has never been clearer. This legislation is essential for the legitimate online entertainment services forced to compete on an unfair playing field."

Academics who work in this area suggest that the problem isn't so much illegal file-sharers, though that is somewhat of a problem, but rather a business model that is out of date:

[Professor] Fader suggests that the content industry has turned to the courts and now Congress to protect a business model that is changing as a result of new technology. "Imagine if the horse-and-buggy manufacturers had legal loopholes to prevent the development of the automobile. They would use it, but would society be better off?"

The recording industry might engender more sympathy if it had made a better effort to incorporate some form of digital distribution in its business model, he adds. "It has never even run an experiment. It wants to have legislators come in to help it avoid the need to ever do so."

Professor Hunger of the Wharton School thinks the music industry is too slow in taking advantage of new technology:

the music industry must come up with new business models. For example, the Internet could allow the industry to slash its distribution costs. "Instead of putting out CDs and shipping them on trucks, they can send them directly at a very low cost. That does suggest a very different business model than charging $15 or $20 for a CD. It might be a much more attractive way to do things. Stuff that is easy to distribute wants to be free. Given that force, I think [the recording industry] needs to come up with a new model for generating revenue."

The movie industry was very much opposed to VCR's and videotape recording of movies when that technology was new -- now it is one of their largest markets. It isn't that technology needs to be stopped, which is the recording industry's strategy; it needs to be exploited.