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2004-05-04, 12:17
The Electronic Frontier Foundation has issued a proposal (http://www.eff.org/share/collective_lic_wp.php) of voluntary collective licensing. They are proposing that for a small fee, p2p filesharers can sign on to a payment plan that would indemnify them against lawsuits by the record companies. The EFF proposal is vague, but it seems that fees paid by p2p filesharers would go primarily towards the musicians and would be proportional to their popularity on filesharing networks. The proposal could be radical because it seems to intend to give no money to record labels, and most of the money to the musicians themselves. Currently record labels make most of the money from CD sales and "legitimate" online downloads. Musicians only make about 12% of revenue. This EFF proposal would be helpful for independent musicians who have no label, and would greatly reduce the marketing power of the major labels over music.

The proposal of EFF is overly idealistic and vague. Most likely any money collected will not be distributed fairly to the deserving parties. There is too much room for corruption because the proposal lacks teeth or proper oversight. They claim in their proposal it will, but there is no suicide clause which would cancel the entire collection system if it fails. From the proposal is this statement:
"How do we ensure accurate division of the money?
Transparency will be critical -- the collecting society must hold its books open for artists, copyright holders, and the public to examine. The entity should be a nonprofit, and should strive to keep its administrative costs to a minimum."

The EFF doesn't indicate in its proposal how much of the revenue will go to the record labels, which they refer to as "rights-holders", and how much will go to musicians, which they refer to as "artists". The vagueness of it can please all parties involved, but there is a big difference in the merits of a system which gives 90% of revenue to musicians versus 10%. Record labels read it and feel that their profits are assured in the proposal. p2p filesharers read it and feel that all of the revenue will go to the musicians and bypass the labels. Surely when it comes down to the actual details then someone is going to be unhappy with them. If it is to give most of the revenue to musicians, I doubt that such a proposal which excludes the record labels from royalties would also be able to grant filesharers immunity from their lawsuits. From the proposal is this statement:
"How does this help artists?
artists will now be paid for the file sharing that has become a fact of digital life."
How much will they be paid though?

I doubt that many filesharers would willingly sign on to such a deal. The EFF uses the argument that people who fear lawsuits would be attracted to it. But it is not certain who would even be doing the suing under such a proposal. If the musicians get most of the revenue, then it would be as if ownership of the music were transferred to the musicians. Currently the labels own the music, and not the musicians.

Unless the terms of revenue collection favor them, the labels won't go along with the proposal voluntarily. If that happens, EFF calls for government intervention to create compulsory licensing. When it does so, it is doubtful that the government would be so radical that it would transfer ownership and profits exclusively to the musicians. But if it didn't, then the plan wouldn't be as popular and people wouldn't feel good about paying into it. The EFF proposal should not be called "voluntary", because it is actually a way for people to avoid lawsuits. From their proposal is this statement:
"those who today are under legal threat will have ample incentive to opt for a simple $5 per month fee."

Another problem with the EFF proposal is that it only reimburses musicians who opt into the system to be reimbursed. It isn't fair for other musicians who voluntarily do not opt into the plan, or are not aware of it, to not receive anything. Just because those other musicians are dead or do not have the means or have chosen not to receive that money, still does not exempt them from being owed. What is to be done with all of that extra money that is owed to them? EFF proposes giving 100% of the proceeds to the participating artists and copyright holders, so there will be no extra money. How is someone to prove he owns a work anyways?

p2p filesharing must remain free of leeching taxes and fees. There is no acceptable appeasement and compromise with greedy thieves who want a "piece of the pie".

2004-05-05, 03:59
i'm curious about this yet not curious enough to read it myself so i'll just post my questions here.

so indemnity from lawsuits... the eff thinks the labels will actually go for this? if not then what indemnity? is there some little back alley note in copyright law that says if they user offers any payment at all (no matter how minimal) then it's not technically theft?

also, as far as i knew it's uploading that's illegal, not downloading. so is the idea that you'll get protection by only uploading to people who your computer somehow recognizes as part of the plan? if that's the case (which it would have to be to be angling at the legal end) that would divide p2p networks into "those that pay" and "those that do not" which would... suck

even if they do, how do they implement the system across every file trading network? once you tell people they have to all jump to one suckass network, it won't work.

and is this grandfathered? will the person have to pay for anything they've downloaded up until now (that they are now offering for upload, that is).

i can think of ways to lure p2p'ers into being paying customers, but this plan isn't one of them. um, unless it's a clever legal strategy to somehow get everyone off the hook from being sued through miniscule payment, hehe, then it rocks.