This is a highly positive move and once again shows the European music industry bodies learning from the lessons of their over zealous US counterparts. The RIAA were ill advised to pursue US ISP’s through the courts in a bid to get subscribers billing addresses. ISPs are going to be central to whatever model emerges as being the dominant one in the digital music space. They are going to be vital partners that the music industry will depend upon as much for distribution as the ISPs are going to rely on the labels for content. In theory it should be a win win situation for both sides and any damage done to relationships now will only need repairing in the future.
So the BPI have wisely taken the long-term view and in doing so are far more likely to get increased co-operation from the ISPs. The BPI’s Jollyon Benn expressed concern that the music industry’s interests were getting left behind as the ISPs struggled with their own problems. But in reality they the same big problem, only they see it in a very different way.
File sharing is in danger of hurting the ISPs as much as the record labels. As our research shows, one of the biggest challenges facing ISPs now is the massive drain on resources that regular file sharers place on bandwidth, often resulting in drop in quality service for other users. ISPs almost need to drive their subscribers away from the file sharing networks as much as the record industry does.
Many European broadband ISPs are now putting data limits on their access packages, but that only controls the fire rather than extinguishing it. Many ISPs are looking at the longer term picture and are becoming increasingly aware that they need to provide their own legitimate music services in order to drive their subscribers away from file sharing. The problem is set to become even graver for ISPs as P-to-P activity increasingly shifts towards movie file sharing that puts a far heavier demand on bandwidth. (These are all issues which will appear in a report I am currently writing and is tentatively titled “Reducing Subscriber Churn and Increasing Consumer Value Through Digital Music Strategies”)
The music industry and the ISPs need each other and the better they get on, the better the prospects for Europe’s online music industry.