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How will artists get paid in 'darknet' era?

Published: Mon April 06, 2009  News Feed

According to some people who are paid lots of money to think about these sorts of things, the legal, ethical and economic questions facing the music business aren’t just about preserving the livelihoods of people who work in that industry. No, the very future of democracy is at stake.

Musicians in the 'Darknet' era - how will they get paid?

Musicians in the 'Darknet' era - how will they get paid?

[originally by Greg Kot, from the Chicago Tribune] That warning put a punctuation point on the 23rd annual South by Southwest Music and Media Conference, which concluded Sunday. Even as 1,900 bands vied for attention, the debate raged at a digital-music panel and in countless private conversations over how music will be distributed, consumed and paid for --- if it all --- in a future that is increasingly being defined by a lawless viral underground.

At the heart of the debate is how to license peer-to-peer sharing of music files, widely blamed for the huge drop in sales of recorded music this decade. Sandy Pearlman, a veteran producer and McGill University professor, and entertainment lawyer Dina LaPolt raised the specter of a “darknet,” in which information and goods are shared in a closed virtual market that can neither be regulated nor monitored.

“The ‘darknet’ is here, with networking in corners of the Net where people can hide what they’re doing” and therefore not be held accountable for their actions, LaPolt said. These networkers are “part of a generation that grew up knowing only about a world of instant gratification and endless choice.”

Digital file sharing has given more people wider access to more music than ever. It has given artists the opportunity to instantly distribute music worldwide to an audience. It has also created an “instant gratification/endless choice” economy in which rights-holders have no viable means of compensation.

“Social networks always start in anarchy,” said Rick Carnes, president of the Songwriters Guild of America. But he warns that if property rights aren’t respected and laws are being broken, the government will have to crack down and impose a new form of Web “tyranny.”

When the government starts putting the screws on rogue Internet traffickers, “You won’t be able to get on the network unless you have total identification,” including finger-printing and complete background information, Carnes asserted.

The anonymity afforded by the Internet “deprives us [songwriters] of the ability to make a living,” he said. “We’re on the frontier of this issue. How we solve it will define the future of democracy.”

Indeed, in Carnes’ vision of Web Apocalypse, the government will be enlisted to preserve copyright law with the type of Draconian measures reserved for police states. If it’s difficult to imagine that scenario becoming reality, consider that the music industry has a lot of friends in Washington, and so far 20th Century copyright law remains a fundamental underpinning of American arts and culture.

Though some in the music industry would surely welcome government intervention to solve its crisis, the tone of the debate has shifted in recent years. Whereas music-industry executives initially responded to Internet encroachment of their business with aggressive rhetoric and lawsuits of consumers, now some execs are seeking a middle ground that would generate revenue for songwriters and artists without disrupting consumers who want to share music files.

LaPolt laid out a “three strikes you’re in” system in response to France’s “three strikes you’re out” policy, in which Internet users are booted off the Web if they continue to share music illegally after two warnings. A better idea, LaPolt argued, is that users would remain connected after three warnings, but their service fees would double.

Jim Griffin, a digital guru who has been hired by Warner Music Group to address the licensing issue, is also attacking the problem through service providers, but in a less punitive way. He urges rights-holder to give up some control over their work in order to get paid. “In the past they just wanted control, now it’s control or compensation,” he said. “That’s progress.”

Griffin proposes a scheme that would allow consumers to continue to download, upload and share all the music they want, but require them to pay a fee to service providers for Internet access. The fee would then be distributed to content rights-holders.

Griffin aims to have the system in place at some universities next year. “It’s an open negotiation with each school,” he said. “We’re saying if you want to pay, let’s experiment. There is no one way to run this program.”

And there’s no one way out of the chaos that file-sharing has made of the music industry. Griffin’s solution at least is a step in the right direction, an attempt to bring together the interests of consumers and artists. It’s a ray of light for a music industry shrouded in darknet paranoia.

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