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Virgin steps up antipiracy enforcement with DRM-free music service

Valerie | 16 Jun 2009, 09:37

Virgin Media has partnered with the world’s biggest music label, Universal Music, to launch an unlimited music download service with a difference.

Signifying the latest retreat from the major record companies from DRM, for a monthly fee, the new music subscription service will enable subscribers to download or stream as many tracks and albums as they want in MP3 format and keep the music they have downloaded even if they stop paying the monthly fee. It builds on similar “all you can eat” download services such as Nokia’s Comes With Music and comes as the UK Government outlines its plans on Britain’s digital future in a report out today.

As part of the deal, Virgin has pledged to aggressively police usage to stop the MP3 tracks turning up on file-sharing networks. This will include educating users but for persistent offenders, the last resort would be a temporary suspension of a customer’s internet connection if that person consistently ignored warnings about their activity.

In a statement, Neil Berkett, Virgin Media’s CEO proclaimed that the new service was an industry first:

“In terms of both convenience and value, our new music service will be superior to anything that’s available online today and provides a fair deal for both consumers and artists.”

The deal was also welcomed by industry trade bodies. IFPI Chairman John Kennedy said the new Virgin-Universal deal was “the kind of partnership” between a music company and an internet service provider (ISP) that he expects to shape the future of the music business internationally.

However, entertainment lawyers said the service was unlikely to solve the global music industry’s problem of billions of dollars lost to music piracy, and would need to offer content from big-name entertainers to be attractive to consumers.

The content industry has been urging ISPs to act as copyright enforcers for some time so the music industry will be watching the experiment carefully. As PA observes, “if content creators can get ISPs and service providers to do copyright enforcement work, they may be willing to publish more content in DRM-free formats that are more appealing to consumers”.

According to PaidContent, Virgin said it would be “negotiating with other UK major and independent music labels and publishers to ensure it can offer a complete, compelling catalogue by the time it launches” later this year.

Are downloads really killing the music industry?

Valerie | 15 Jun 2009, 15:44

Research commissioned by the Strategic Advisory Board for Intellectual Property published in the Guardian recently revealed that 7 million people “use” illegal downloads in the UK, “costing the economy billions of pounds and thousands of jobs”.

It followed the news that a coalition of creative industries organisations, including Pact, the broadcasting and entertainment union Bectu, the BPI and the UK’s biggest trade union, Amicus/Unite had, in a letter to the Daily Telegraph, outlined its calls for increased pressure on the government to act against illegal downloading in the forthcoming final Digital Britain report, stressing that failure to act would lead to widespread job losses in the creative industries. A consumer poll also found that the majority of British adults would back stronger government intervention against online piracy if it helped protect media industry jobs.

However, an article in the Guardian asks whether it is disingenuous to count each of the millions of music files downloaded each day as a “lost” sale. Instead, Guardian writer Charles Arthur argues that perhaps filesharing isn’t music’s biggest foe.

Comparing sales figures for consumer spending on entertainment, which includes music, DVDs sales and rentals and video games, he proposes that what appears to be hurting the music industry most is growing competition from the games industry. The figures show that whilst total spending has grown – music spending is being squeezed, with spending rising dramatically in the games industry, from £1.18bn in 1999 to £4.03bn in 2008. 

Summing this up, he said:

“... the reality is that nowadays, one can choose between a game costing £40 that will last weeks, or a £10 CD with two great tracks and eight dud ones. I think a lot of people are choosing the game - and downloading the two tracks. That’s real discretion in spending.”

Clearly there is much the music industry can learn from the games industry – Arthur suggests for example that consoles / new business models that lock consumers into buying its products is perhaps the way forward.  With subscription-based services from the likes of Spotify growing in popularity, innovation has an important role to play in helping the music industry to fight for a larger share of the consumer’s wallet and ensure customers keep coming back. It is this alongside the file sharing challenge that the industry needs to address if it is to survive and prosper.

France sets global precedent with tough internet anti-piracy laws

Valerie | 15 May 2009, 08:14

As the anti-piracy debate heats up in the UK, which has this week seen a coalition of creative industries led by the UK’s largest media groups lobby the Government to force ISPs to take a greater role in the prevention of internet piracy, French politicians have given the go ahead for tough new laws against internet piracy.

The proposed French legislation – the controversial “three strikes” law – could see alleged copyright infringers disconnected from the web without legal recourse.

The BBC argues that it sets an important global precedent for anti-piracy groups in the UK and elsewhere in Europe and is being closely watched by other governments as a potential deterrent.

The legislation, which is backed by President Nicolas Sarkozy, will operate under a three-stage system. A new state agency called the ‘High Authority of Diffusion of the Art Works and Protection of Rights on the Internet’ –  or Hadopi for short – would first send illegal file-sharers a warning e-mail, then a letter, and finally cut off their connection for a year if they were caught a third time.

The film and record industries have backed the bill but some groups have claimed that the measure would be a violation of individuals’ rights.

The socialist parliamentarian Patrick Bloche said the bill was “dangerous, useless, inefficient, and very risky for us citizens”.

Earlier this week, the Directors Guild of America, the body representing the interests of film and television directors in the US motion picture industry, said its national board had passed a resolution in support of the law.

DGA president Michael Apted said:

“The DGA believes that online piracy is among the greatest of threats to the health and future of the creative industries… The French model is remarkable because it creates a solution that enforces the idea that piracy is serious, while avoiding unfair punitive or financial measures and the quagmire of endless lawsuits.”

In the UK, the umbrella group that represents ISPs has rejected calls for them to police the net and said that disconnecting users would be a “disproportionate response”.

However, Barbara Follett MP, minister for the creative industries, told a conference of industry executives in London that the government was considering a system of warning letters to offenders with the threat of legal action, rather than disconnection and are instead looking to build on the memorandum of understanding set up last year between government, ISPs and rights holders.

As the debate continues to provoke heated discussions across the content industry, Jean-Bernard Lévy, the French CEO of entertainment conglomerate Vivendi will be taking part in a c&binet event in October to help co-ordinate international action on IP commercialisation and protection.

UK Media bosses call for piracy legislation

Valerie | 11 May 2009, 10:11

The Sunday Times reports that leading figures from Britain’s biggest media firms including c&binet ambassadors Lucian Grainge of Universal Music and Channel Four’s Andy Duncan have formed a “copyright sqaud” to advise Lord Carter on how to tackle online piracy ahead of publication of the Digital Britain Report on June 16th.

The six-man working group, which also includes Michael Lynton of Sony Pictures, Jeremy Darroch of Sky and Neil Berkett of Virgin Media are calling for draft legislation that will force internet service providers (ISPs) to collect data on repeat offenders which can be used to prosecute them, citing that uncertainty over legislation has delayed signing rights deals. However, ISPs have been reluctant to support legislation, arguing that that it raises privacy issues.

The news follows the recent Pirate Bay ruling which found the Swedish site guilty of helping to make copyright-protected content available to others, setting what many believe will be a precedent that will have far reaching implications in the content industry.

As the BBC notes:

“Content creators who are struggling to get consumers to pay for movies or music in a digital world are on the warpath. They’re telling ISPs and consumer technology firms that they must help plug the hole in the creative industries’ finances caused by file-sharing or copying. And they seem increasingly confident that governments will listen to their message.”

The message is clear that content creators believe ISPs have an important role to play in addressing internet piracy and must welcome the news that companies such as Virgin Media are championing this cause.

Digital Britain Summit – Equipping Britain for a digital future

Valerie | 17 Apr 2009, 09:58

Leading thinkers in the Digital Economy are gathering at The Digital Britain Summit today at the British Library to debate how best to equip Britain for a digital future.

The event will give stakeholders an opportunity to listen and debate the interim report’s recommendations and ensure all views are considered before the final report is published in the summer.

Speakers including telecoms CEOs Ian Livingstone, Neil Berkett and Ronan Dunne, technophile Stephen Fry, Universal Music’s Lucian Grainge, Johannes B. Larcher from Hulu, Hirouki Hishinuma from the Japanese Government and Will Hutton, Chief Executive of the Work Foundation, will join 250 industry leaders to address how to secure Britain’s place at the forefront of the global digital economy.

Culture Secretary Andy Burnham, Business Secretary Peter Mandelson, Sly Bailey (Chief Executive, Trinity Mirror) and John Fingleton (Chief Executive, Office of Fair Trading) will deliver keynote speeches.

Key issues to be discussed today in the four panel sessions include:

• Preparing for tomorrow’s digital networks today: looking at infrastructure issues that will determine the UK’s readiness to fully exploit the dramatic shift to digital technology

• The New Digital Arms Race: different approaches around the globe to achieving a successful digital economy

• Joining the dots between creativity and digital content: matching technical innovation with the development of business models that enable content creators to flourish on these new platforms

• Equipping our society for the digital future: ensuring that the benefits and advantages of the digital economy are available to all

You can watch the Digital Britain event live and follow the debate via the Digital Britain summit live blog and submit comments as well as questions for the speakers and panel at the Digital Britain Forum website.

You can also follow proceedings via the Digital Britain twitter feed or tweet questions to @digitalbritain.

Lloyd Webber calls for P2P Regulation

Valerie | 06 Apr 2009, 09:26

Music composer and theatre impresario Andrew Lloyd Webber has attacked internet service providers (ISPs), blaming them for facilitating online piracy and has called on the government to safeguard Britain’s creative future by drawing attention to “the cataclysmic consequences for all creative industries if this area remains unregulated”.

Speaking to the House of Lords on Thursday, Lloyd Webber said:

“The question that occurs to me is whether, in 10 years’ time, Britain will be a place from which, say, the Beatles could have emerged. Will Britain be a fertile environment for all creative talent? Will Britain be a place where music, TV, film, games and publishing companies are sufficiently healthy to invest in British creative talent and take it to the rest of the world?

“No, not when there are no longer shops selling the physical products and when the internet has become a sort of Somalia of unregulated theft and piracy”.

Whilst admitting he “had no real answers” to the question of how to reduce piracy, Lloyd Webber urged the government to delay its plans to invest money in improving the national broadband network until a solution to illegal file sharing can be found. He also referred to the proposal outlined in Lord Carter’s Digital Britain report that suggested ISPs should collect and share data on copyright infringement so warning could be issued by rights holders, arguing in favour of tougher measures such as the “three strikes” regime, whereby repeat infringers would be cut off from the internet.

Lloyd Webber’s comments come as high profile musicians such as Billy Bragg and Robin Gibb have, in a letter to The Times, accused Google of devaluing songwriters, following a dispute over the payment of royalties from music videos played on YouTube.  A YouTube spokesman said that the firm “cannot be expected to engage in a business in which it loses money every time a music video is played”.