Resnikoff’s Parting Shot: Just Legitimize It?

If it were only that easy.

Turns out that ‘flipping the switch’ on a licensed P2P platform is just not that simple, even with willing parties.  In fact, even if labels were ready to legalize Napster on the first go-round, they would still be looking at potentially years of licensing across all labels, publishers, and ISPs.  And in the case of Virgin, it was about much, much more than just an “11th hour” denial.  In fact, only a few of the needed parties were actually at the table to begin with.

So, is licensed P2P impossible?  At least a version that does not include ridiculous restrictions and partial catalogs?  For inspiration, just look at the iTunes Store, an easily-doubted ambition before 2003.  That is a separate story with its own unique history, but bottom line, Apple secured the licenses to sell paid downloads from a critically-large number of rights holders – across recordings and publishing.  And they did it with uniform pricing and without succumbing to a byzantine set of rules and conditions (though some restrictions, including DRM, were required).

The upshot?  Parties can be brought to the table under the right circumstances and with aligned business motivations, or more easily, with the right amount of money.

But what if the parties are unwilling, or hesitant, or at conflict with either their business partners or consumers?  Majors may be talking about the possibility of doing blanket-level access deals with the ISPs, but are they willing to really give music fans what they want?  In other words, mirror the usage scenarios that consumers are currently accustomed?

Perhaps a DRM-protected concept like Play by TDC in Denmark can be hatched, with some success depending on the market.  But an agreement that looks like, feels like, and tastes like genuine file-swapping?

Currently, the answer is no.  Just look at the structures that major label groups are attempting to construct.  The RIAA is talking about agreements with ISPs that will include terminating accounts.  At least one ISP – Verizon – has outwardly denied that any such relationship exists, and the remaining RIAA “deals” remain nebulous.  Turns out that spoon-feeding the Wall Street Journal is no substitute for real negotiations, but it does reflect a mentality that is far short of legitimizing P2P.

Across the pond, the British industry is sending threatening letters to win the market back.  In its early stages, that appears to be having little impact, and the plan could be generating big brother animosity.  After that?  Are British major label groups now willing to go from letters to outright, P2P-like access, unfettered and totally flexible?

In July, now-UK Music head Feargal Sharkey told Digital Music News that a blanket-level P2P was simply not in the best interests of the industry.  “There’s not an awful lot of money, which then has to be divided up,” Sharkey stated.  “And anytime you want to grow the industry, you have to lobby the government to increase the levies.  It’s a mind-boggling way to run an industry.”

In other major countries, similar examples exist.  In France, for example, the momentum is behind a ‘three-strikes’ agenda, another punitive model based on content protection and enforcement, instead of permission.  The plan – potentially on a “crash course with Brussels” as one Midem expert put it – is also far from a legitimized, feels-like-free solution, one that resembles – or surpasses – the real thing.

Paul Resnikoff, Publisher.