File sharing is the beginning of a new industrial revolution

File sharing is a benefit for society as a whole but breaks with the old model of paying for movies and music. Unfortunately, the music and film industry have gone to war against their own customers instead of exploiting the opportunities offered by new technology. We need solutions that are both paying for the production of culture and allows the free sharing of it.

Surprisingly, many think of file sharing as a matter of what is right and wrong according to current legislation. To solve it right away: Unauthorized file-sharing, as the law is today, is almost always illegal. What we are discussing is whether it should continue to be so. The Norwegian Professor Olav Torvund seem to think that the problem had resolved itself if the Pirates had only followed the law and morality. What he does not take into account the fact is that there are good reasons that the law no longer has authority.

File sharing is the beginning of an industrial revolution

By volunteers, millions of people worldwide build the world’s largest library and made available to all. To share music, movies, software and information in a scale as before would not have been possible. Today it is no problem to share a song or movie to all people who have internet access, free of charge. One copy costs just as much to produce as a million copies. 10 years ago would have been practically impossible to have access to all cultures around the clock, we are growing up now see it as a platitude.

Everyone agrees that the Internet is the future for the distribution of film, music, and all other digital content. Nor is there any who believe that the movie or the music industry does not need money to keep making good movies and music. The most important distinction is between those who want to move the old models of the Internet and those who realize that the market economy with a unit price and retail sales do not work online and can not do it.

What distinguishes the Internet from the ordinary world is what separates a digital copy from a physical copy. The physical copy is always in limited numbers. Every single physical copy of a CD has cost plastic, time and labor to produce and when someone bought a CD can not buy just the second copy. Physical copies can be found in a limited number and then it’s logical to have a market economy, where pay rates copy.

The number of digital copies is not limited. The only thing that limits the spread of a digital copy is the speed of the network used to share it. Modern file sharing systems have solved this problem elegantly by not downloading the file from one central computer, but from each other. Millions of ordinary PCs in common areas of home tasks and ensure that everything is always available.

A digital copy that is shared in this way is an abundance of good that we have unlimited access. It’s not like in the physical world that when one person takes a CD then it becomes a CD unless the rest of us. Quite the contrary!
When a person downloads a CD so other people can download the CD from the person! The more that is looking for something — the more accessible it becomes. This should be an ideal situation, but for the record industry it becomes a nightmare when their business model collapses.

How is it financed?

When new technology makes the old ways to finance the production falls off, you have to find new and better ways. Music and film industry is trying instead to introduce a model that breaks with the opportunities offered by the new technology. They attempt to limit and reverse the trend by engaging in shops where you sell the unit price.

This is absurd in the digital world. It is ineffective, and it is not social. Through wallet distributed culture of those who can afford, but even the richest man will have endless access so he could have had. To set a unit price will ruin the whole Internet revolution that has created and want to make digital copies of something you have the infinite, to which there are shortages.

All attempts to introduce the unit price has failed. Firstly, the files were in poor quality compared to what you can get through illegal to copy a CD, for the other prices have been set close to the price one would pay for a physical copy and thirdly, people could easily copy files and share them with each other.

There are good alternatives to the forced introduction of market economy on the Internet. In economic terms is not a digital copy very different from a radio broadcast, a park, a road or a lighthouse. All of these benefits is something we want to pay for — but once it is in place is difficult or impossible to prevent people from using. Nor is it so that it becomes less of a radio broadcast the more who hear, or that (up to a certain limit) to a park or road will be used up if one extra person using it. What has to be financed is to build the park, making the radio broadcast and recording music. Taking charge for using the park, listening to the radio or downloading music is ineffective and not social.

A number of economists, pirates and others have made good suggestions for how to finance the cultural industry in a world where everyone has access to all the culture through a gigantic library. The proposals range from various forms of public financing for the overlaps of the entire industry. I’ll take me a couple of these.

First, we might ask ourselves how much money we are talking about. The music industry in Norway last year had sales of approx. 700 million (Source FPI). That’s down 25% from the peak year of 2002 (at the same time, revenue from concerts increased by as much). It represents about 280 per year per employed person, not a huge sum for most people.

Film and DVD sales have actually gone up by as much as 16% in one year and ends at approx. 900 million years (not including movies). One might ask how much of music sales fall due to competition from film and other media, but I do not go into here. Taken together, then the sale of culture on CD, DVD and other formats approx. 600 per employed person. It is unlikely that all this sale falls away in a day, but I reckon that file sharing will outperform other forms of distribution in the coming decades.

The easiest way to finance the free sharing of culture is public funding through tax, tax on broadband, the oil fund, music /film license or the like. The money can then be divided between artists and film producers on the basis of how many people have downloaded various songs and movies and a distribution key.

It is quite big differences between the various solutions: If a license, you put the flat price that almost everyone has to pay, just like NRK license. (NRK = Norwegian state broadcasting system)
If you do not enjoy music or movies online and can prove it then you do not pay, but if you do have to pay as much — no matter how much you spend or how poor or rich you are.

Licenses are unsocial and poorly conceived and costly to collect. Tax on broadband is a better solution, those who can afford and the need for powerful broadband will also pay more. Media use is probably one of the largest uses of powerful broadband, but it is clear that others may feel unfairly affected.

Through tax can ensure that those with high incomes pay more than those with low and may enhance the social impact of the free spread of culture. 600 million can be much of a family who must choose between the class trip and dinner, but negligible for those with more money in the bank.
About when the former family escapes with 0 and the latter will pay 1200 so you ensure free culture of both without much financial consequences for some of them. It is right that you pay according to ability and receives according to need.

One can find many good solutions to this problem, and if the industry wants to be involved in designing their own future, they must lay down weapons, end the war against their own clients and begin the work together with the generation of music lovers who are now growing up.
The important thing is that we manage to retain what makes the Internet into something better than the physical world: Free sharing, free copying and no artificial obstacles.

Artificial barriers

The industry has tried to prevent further copying of the files they are selling by adding artificial constraints in the form of DRM = (BMG_CD_copy_protection_scandal) Music files self-destruct after 3 time, the music files that can be played within a certain period of time, which theoretically should be impossible to copy and music files that monitors your PC to make sure you do not do anything illegal. DRM would save the industry from piracy by making it difficult, if not impossible, to copy a legally purchased file.

The problems with DRM turned out early. Music files could be played only in programs that were designed for DRM, which meant that songs purchased with Microsoft’s «Plays For Sure» system could not be played if you did not use Microsoft software. We pirates was not at all hindered. To copy a file that is encumbered with DRM is as easy as copying any other file, given the right tools. The only people who were harmed were those who actually bought the music, and the industry that started a war against its own customers. Now the DRM on the way out, and several shops selling music without such artificial barriers.

The writer Onar ?m (AAM’s) proposal is technically feasible. That does not mean that it is practically possible, nor desirable. The idea behind such micro payments online is not new, but to find out how many seconds you have read nrk.no today, how many minutes you spent on the music of Michael Jackson and to prevent you from doing any of this will be unregistered require a 1984-society with an extreme version of the DRM and monitoring of all network connections. The proposal requires a well regulated and monitored online with a huge cost both in terms of privacy and money.

I pull the The writer Onar ?m (AAM’s) article because his sight is disconcerting common in some of the industry. They look with fear on the free sharing and jumps on every opportunity to crush the digital library and introduce a normal market economy so they know and are accustomed to it. The proposed micro-payments are asking a very good question: Where will we going with this new technology?

What about the law?

Today, the law adapted to a time before the Internet, where to distribute a CD on a large scale meant to sell it on. Copyright law has changed, and there have been many good suggestions from, among other things, Creative Commons — Swedish Piracy Law and the Free Software Foundation.

It takes time to change the law and most likely will not have parliamentary parties see well enough to walk and the courage to change the law before the industry and the voters agree on a solution. This is a great challenge for the Norwegian label, authors, filmmakers and musicians who want to use the Internet to spread their music, but want money for the music they make. Fortunately, there are workarounds that progressive record companies can try out.

A challenge to FONO

Norwegian record industry has the opportunity to walk in the forefront of using new technology in a sensible way. FONO organizes 120 Norwegian record companies of varying size and has a market share in excess of 10%. They can try with a licensing system where you pay 100, — N.Kr per year to be allowed to freely share and download music FONO worldwide. They must then make some agreements with the largest file-sharing site to keep track of what music is being downloaded and which one either buy on CD.

Such a «FONO-license» will ensure that music lovers can use the new technology, musicians can make money and war ax between FONO and customers can be buried, even before the law changed and a complete system in place. It can provide Norwegian music a much-needed boost in the competition against international music. FONO dare take the challenge?

Author: Sebaldus