Criticism of SAC’s Music File Sharing Compensation Proposal

Saw this article in today’s National Post that criticizes SAC’s recent proposal for compensation for music sharing monetization, deemed by the author to mean a “song tax”:

Monday, February 25, 2008

Debunking the song tax

National Post Published: Monday, February 25, 2008

You probably read about the proposal put forward last week by the Songwriters Association of Canada (SAC) for a $5 monthly tax to be applied to all “internet subscriptions” and distributed to songwriters as compensation for illegal music sharing. As a sensible human being, your reaction was either rage, laughter or some combination of the two. But let us put on a sober face for a moment and enumerate everything we can think of that is wrong with this pitch:

-It would penalize those who engage in no legally dubious filesharing to begin with. Some internet users don’t care for music and may not have media files of any kind on their computer. Others have only music they obtained legitimately — whether purchased from a recognized online vendor like iTunes, downloaded from an artist who offered it free or copied from older media for personal use. Those legitimate online vendors, by the way, would immediately lose the Canadian market, crippling the hopes of musicians who believe that internet sales are a better path to viability for the recording industry.

-Some users may not download much Canadian music, or indeed any, yet the Songwriters Association proposes to reward only “Canadian music creators” with revenue from Canadian internet users. The anticipated income would be in the neighbourhood of a billion dollars annually; this is curious, considering that in 1999, before record sales began to slump, the total value of all recorded music (from any country) sold in Canada was only $1.3-billion.

-The proposal uses statistical figures from biased sources (citing a Canadian Recording Industry Association “news article” in estimating overall nationwide filesharing) and spectacularly tortures figures from independent ones.

-There is no suggestion that the decline in legitimate sales of recorded music over the past 10 years, whose severity is itself controversial, has been caused by anything but illegal filesharing. The possibility that the music industry might be the victim of suicidal marketing choices, or that popular music might simply be in a fallow period, is never considered.

-Higher prices for internet access in Canada would worsen the “digital divide” between rich and poor. Canadians already pay large amounts for bandwidth — according to the International Telecommunication Union, an agency of the UN, access costs twice as much per bit here as in the U.S. and easily 10 times as much as in Japan and Korea.

-A special tax on internet access for songwriters would inevitably be followed by demands for similar taxes in the interests of motion picture producers, authors and visual artists. The songwriters’ demand for the seizure of $60 a year can only be considered modest if one denies the obvious — that as groups with equally legitimate claims came forward, it would soon become $120, or $200, or $500.

-One of those groups might well be non-songwriting performers on music recordings, who enjoy certain moral and royalty rights under some regimes. What, after all, is so sacred about the traditional legal balance of royalty rights that weighs so strongly in the favour of the songwriter at the expense of other contributors? Who contributed more to the first hit version of I Heard It Through the Grapevine — was it Marvin Gaye, or the writers (Norman Whitfield and Barrett Strong)? You can reasonably argue either side. But then you have to consider the unheralded sidemen who played those thrilling strings, or the backup singers, or the studio engineer who stuck a microphone in front of Mr. Gaye’s mouth. The apportionment of credit entrenched in 20th-century music law is quite arbitrary, and has led to abusive practices at times, such as when powerful producers or managers bullied artists into giving them false songwriting credits.

-Remarkably, the proponents of the internet tax for songwriters seem not to have considered the possibility of widespread tax avoidance. They want $5-a-month tax on “internet subscriptions,” but what defines an “internet subscription”? If four people in my household have access to a wireless network, but there is only one bill, do we owe $5, or $20? How can internet cafes and public libraries bill their customers? What about users who let passersby piggyback wirelessly on their laptops as a matter of courtesy? Couldn’t any large group join together to buy one wide-band “subscription” from an ISP to beat the tax?

-How is the money to be distributed? SAC hallucinates an ultra-powerful, bias-free “collective” that “would track internet and wireless file sharing activity on a census basis. Virtually all sharing on the internet and wireless devices would be tracked,” they promise, and “Creators and rights-holders will be paid with a level of speed and accuracy never before possible.” Will this happen before or after pigs fly? And are you comfortable letting Eddie Schwartz and Randy Bachman monitor all the filesharing activity on your PC, or would you immediately click on the encryption option that peer-to-peer sharing applications already offer as a matter of course?

We know what choice we would make.

Copyright © 2007 CanWest Interactive, a division of CanWest MediaWorks Publications, Inc.. All rights reserved.

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