More Anti-Piracy Legislation

The Swedish government is working on legislation to compel ISPs to provide details of IP addresses used for illegal file sharing. (Sweden remains the main home of the infamous Pirate Bay). This is part of a European swell of rights owner driven legislative activity. Currently Swedish ISPs are (predominately) not liable for the data on their networks, the traditional defence of ISPs.

If the precedents are set and ISPs do become liable there will be a crucial period of adjustment, for a couple of reasons in particular. Firstly a line will need to be drawn in the sand somewhere: the sliding scale is already beyond zero due to issues such as terrorism, but it will need to stop somewhere short of the other extreme. Secondly, and explicitly related to the former issue, enforcement has to be practicable and affordable. No one can afford to police and enforce every infringer, and indeed currently the content industries only go after the core infringers. A workable framework needs to be put in place that strikes the balance between responsibility and affordability for ISPs (which ideally should be explicitly tied to beneficial license terms for content offerings, including bonuses for achievement of enforcement targets). The ISPs need a big, fat, juicy carrot to accompany the stick.

Currently the music industry is most strongly associated with fighting online piracy, but the TV and film industries are becoming more important as every day passes: video file sharing is growing strongly in Europe (a report on this topic by my colleague Ian Fogg will be published very soon). But it’s not just becoming a big deal for the content owners, it’s impacting ISP networks more than music sharing. In Sweden about a third more Internet users file share music than video, but the traffic from video (according to my back of the envelope calculations) is already at least 50% bigger. This share will grow as HD content becomes more prevalent and adoption grows.

So the movie and TV industry are facing the same questions the music industry did back with the rise of the original Napster. What is interesting though, is the difference in approach from many TV broadcasters: alongside enforcement are mainstream free online offerings: iPlayer, Hulu, etc.

The TV industry can probably afford for the Internet to act as ‘radio’ for them as advertising is (normally) a basic element of their core business. The Music industry though, already has its radio and is counting on the Internet to shoulder much of the retail role that CD is shunning. In short ad spend alone is not enough for the music industry online.