The music industry has long argued that free distribution of its wares over the internet is to blame for steep cuts in musicians’ incomes. Once focused principally on pirate sites, this belief has extended to lawful services, particularly YouTube. Artists criticise the video and music network for paying what they see as inadequate fees for usage while also eroding the audience that would otherwise pay more to hear what they produce.
This week sees the launch of a new campaign aimed at remedying the perceived inequity. A group of musicians and record companies — fronted by A-listers such as Taylor Swift and Paul McCartney — is petitioning the US Congress to change the laws on digital copyright.
In a letter they argue that the provisions of a key piece of legislation — the Digital Millennium Copyright Act — are skewed too far in favour of internet services such as YouTube and Facebook, and should be amended to give them more protection. The involvement of so many big name stars will no doubt ensure the campaign attracts lots of public attention. But there is just one thing wrong with their underlying thesis: it is almost entirely misconceived.
At the heart of the dispute lies a concept known as “safe harbour”. Subject to certain safeguards, this shields an intermediary service such as YouTube from legal liabilities over material that users upload to its site. It is a principle that has advanced economic progress, in particular enabling the rise of social networks. But it also causes a good deal of angst to the recorded music industry. Artists argue that it enables widespread piracy, thus devaluing their content and making it much harder to get a fair price.
Some intermediaries may be careless of their legal privileges. But it is hard to count YouTube among their number. The company has sought to give artists greater control over material it publishes. It has developed “Content ID”, a tool that allows content owners to identify unlicensed material and then to block, track or monetise it (by allowing Google to sell advertisements against the content). This goes beyond the provisions of DMCA. The music industry uses this tool to make money from YouTube content 95 per cent of the time rather than block it.
No one disputes that the digital era has seen falls in music revenues. Sales have nearly halved since the millennium, from $27bn in 1999 to just $17bn in 2014. It may be that Ms Swift and Mr McCartney have a case for saying that YouTube and other streaming services should pay over more of their own revenues — although many are lossmaking. But that is a commercial issue, not a case for copyright reform.
The musicians also need to recognise that safe harbour is not static. Case law has progressively loaded more obligations on to social networks as technology has advanced and their businesses have become prosperous. But push all responsibility for copyright infringement on to these networks and many businesses could be undermined.
Nor is it clear that stripping away safe harbour would lead to more revenues for the music industry. It is just as likely that consumers would sate their appetites for free content by returning to piracy instead.
Any cultural endeavour involves trade-offs between the creator and those who distribute their material. Artists may feel that they are being inadequately compensated for their efforts. But if so, they should deal with the problem directly, if necessary by withdrawing their content from the distributors with whom they are in dispute. Society should not be obliged to change the law.
Letter in response to this editorial:
This article has been amended since first published to clarify the use of Content ID on YouTube.
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