If iTunes music subscriptions don't happen, it's not because the industry lacks interest. Universal's already got a sub plan; Sony BMG is forging ahead with their own; and now Warner Music is investing serious resources and effort into pushing for a monthly music tax. They want $5 a month tacked onto everybody's internet bill, and in return, everyone would have unlimited access to basically all known music. It's not as generous as it sounds.
Michael Arrington points out that a $5 tax—besides essentially turning music into a service requiring us to perpetually suck on the industry's teat—would double its size, from $10 billion to $20 billion. So of course the labels are all for it. It's guaranteed revenue that would flood their coffers like never before. Warner's plan calls for the cash stream to flow into a pool that'll be split between copyright holders and artists. But we all know how hard labels want to screw artists.
And as Arrington points out, it would basically freeze innovation in the industry, meaning labels would be able to ream them that much harder. Not to mention, thanks to the fine print, we'd probably no longer own our music. But that's the whole point. [Portfolio via TechCrunch]













Comments
well i already get all my music for free from the library. why would i pay $5 extra for something i dont need.
Interesting, I have only recently realised how bad Itunes's near monopoly has been for the music business.
This music surcharge is another step in the wrong direction by an industry that never learnt to embrace technology.
Hope this does not come through
I'd support a $10 tax if it applied to _all_ copyrighted materials. This shtick of "just certain media" isn't going to fly, and is inherently discriminatory.
This would be horrible for all the people who don't care about downloading music...it would be like a cigarette tax on people who don't smoke...
If the finsky did not go to the recording industry, and somehow could be fairly divided by all of the artists, then I might be okay with this idea. Otherwise, this is bollocks.
no1 gonna accept it not every1 downloads
If this $5/month surcharge goes through, I think it would be the first tax ever charged that was designed solely to fill private companies' coffers. Actually it's similar to Microsoft's 'pay for a Windows license whether you install it or not' deal with the PC manufacturers. That sure went down fine with the feds.
Good luck on the labels fending off not only the feds but the class actions suits from internet subscribers who refuse to pay because they don't download music online.
The record label execs have their heads stuck so far up their asses that they can't think straight anymore from breathing all that methane.
Excellent idea!
I want Vivid and Penthouse to push for a $5 tax next! Unlimited access to all known prOn?
I'd never leave the basement!
Then, for those inevitable 'down times', how about a $5 tax for unlimited access to all known books.
Then, give me a $5 tax for all known video games.
Where does it end?
How do you decide who get the money? This kind of crap makes me feel like Nazi Germany 1932 although I'm not 100% sure why.
Why don't the content providers come up with 1 DRM(or none at all) and just charge people a monthly fee to unlock the DRM or just be legal. You can't force this on everyone or get the government involved. This could be $5 a month then you would pay for what ever is your favorite supplier of the content(itunes, napster...).
The real problem is who is getting the money and can the ENTIRE music or movie industry get together? The indies woudl have to be included and the bigger boys would have to work with them and I don't see that happening anytime soon.
I buy CDs, so there is nothing at all generous about coercing $5 out of my pocket.
I thought only governments could legislate "taxes".
Oh, you mean the RIAA is a government agency ?
/sound of Daffy Duck "dee thpick abbbbb ul"
@fastm3driver: A little too early for Godwin's law. We'll ignore the first part of your comment because bashing this dumbass "tax" is fun.
Matt has it right. Who gets what percentage of the dough from this "tax" would be near impossible to figure out - which usually means the major labels/publishers get most of it.
The artists get screwed as usual.
@jibbly: Yes. Why haven't they sued the RIAA for taking all their money?
i wouldnt mind, i personally dont like every song on a cd so i would only download the ones i like...and it would be great only if the songs didnt have viruses on them! i wouldnt mind at all though
If they don't distribute or market music anymore, why should they get paid? I cannot stand this industry's sense of entitlement. They no longer add value, goodbye. Goodbye!
@pradster: I'm trying to understand the regurgitated logic in your post. How exactly is Itunes a monoply? Everyone can go to the local target, best buy, mal-wart,etc... and pick up music. I'm not an apple fanboy, I typing this from an HP laptop. People need to understand that the music industry got lazy, and steamrolled by technology. I do use Itunes though, its probably the best program i've used for cataloging the music I purhcase at the local indie retailer. Itunes the store is excellent for singles... and thats pretty much it. Can we stop with this lame "Apple destroyed the music industry" logic. Its not true, its a lie.... and F the RIAA....
@ANoel:
::rotates beak to correct side of head::
Or, how about this instead: Fuck Warner Music.
It's an interesting idea. But given the industry it'll be done in the most evil way possible. "dee thpick abbbbb ul" indeed.
So if this goes through, what happens to something like EMusic? I subscribe now, but clearly I wouldn't need that subscription anymore if that $5 covered anything I wanted to download.
Oh they can just shove it up where I think. There's no way I'm paying that much just so they can offer more mediocrity and whine about eviiiiiiil piracy
Will the end the fine/tax on blank CD's?
@chucklebuck: 1 of 2 things would happen to EMusic
1. They get a cut to cover their business expenses.
2. (The more likely) They'd get shut down from lack of business within a few years. EMusic and other companies of the like would suffer a crippling financial defeat, RIAA wins and suggests to boost the fee to a Hojillion Dollars a month onto your internet fees instead.
@jibbly: @fastm3driver: "How do you decide who get the money?" "The artists get screwed as usual."
Actually, this is artist-friendly. The model for distributing the money is based on the current ASCAP/BMI system. ASCAP collects licensing fees from radio stations, restaurants, clubs, and stores (hence those "ASCAP" stickers you see everywhere). Then, ASCAP tracks what music is actually played and distributes the money proportionally. So, for example, if your song is played a lot on the radio, you get a bigger portion of the pie.
The music internet tax system would similarly distribute proportionally based on traffic. If you wrote a song and lots of people downloaded it in one month, that would be tracked through traffic sampling, and you would get a bigger piece of the music tax pie that month.
To make it fair, there should be some kind of opt out feature so that if you don't download any music, you don't pay, but if you do, there's a threshold that triggers the $5/month tax.
I wouldn't be surprised if, with increasingly sophisticated filters implemented by ISPs (whether we like it or not), this kind of thing is inevitable, and not just for music but for all content distributed over the internets.
The only reason this makes sense is because they take a Lincoln from the people that have no desire to download music. Granted this is almost guaranteed to never see the light of day, they (the record co's) really aren't helping their image by thinking they are important enough to need a "tax". Why not make a legitimate attempt at working with technology instead of just piggybacking a tax onto what is already there?
Wait, so were this to be applied, would I then have to pay a $5 monthly surcharge for both my cable modem AND the "unlimited internet" access I have on my phone?
So if I pay twice as much, how the hell do I get twice as much "unlimited" music for download?
Oh, if I had my way, when the revolution comes, the RIAA will be the first against the wall.
@frigg: I don't know about artist friendly. Maybe signed artist friendly. For those of us who produce and distribute our own music (and do get revenue from places like iTunes and eMusic, et al.) I don't see this working out at all for indie acts.
1) Smacks of desperation
2) Discriminatory in the extreme
3) In most counrties completely against the law, how can someone be taxed on a potential.
Thats like saying 'you might buy a car one day so start paying the insurance now'
or worse if they are saying its to stop illegal downloads as thats the equivalent of saying 'you might steal someday so your gonna do 5 years now'.
What is this, fucking minority report. Stick it Sony.
So, they charge us to download tracks first. Then, they charge us through the internet connection used to DOWNLOAD those tracks??
I'm sorry, but double taxation is not the way to fix your F'ING industry!! All it does is piss us all off. Stop relying on an archaic system and just suck it up and find something NEW! The Artists don't need the stupid MAFIAA to support the record labels that take most of their record sales these days. Just make it available for direct purchase or download and you'll be able to keep your money.
Death to the MAFIAA!!
Nah. I am fine with the current route: bankrupting the music industry until all the major labels close shop, then setting up a market-based pricing model. It seems to working so far, why stop?
Sorry meant to say Warner. Ahh screw all of them.
@Jurisprudence: "1) Smacks of desperation"
Yeah, that means we're starting to win...finally...
What's wrong with finding an album you like and buying it? All the labels have to do is make that possible, and instead they choose to go for subscription services and DRM.
No wonder they're forced into trying shit like this when the pirates offer a better service than they do.
@BigDanInTX: @BigDanInTX: I'm gonna go on an extra-special torrent spree tonight just cause of that.
Not downloading NIN Ghosts or anything from the new model, just outta respect, and I think they deserve the oney for the cool tunes.
making money off people who don't even download music. brilliant.
Is Warner being run by communists now?!?
Any legislator that introduces this on the state or federal level seriously needs to be voted off the island.
We have a capitalistic, free enterprise system. People in our system get to choose to do business with people or companies based on free will, MFs!
Just like any other business, if you find that you're not making enough money to support your operations, you need to change your business model, bitches, not intentionally harm consumers.
Why would the music business be any different from other businesses/industries? Oh, look, I have a business that no one uses. I'd like to suddenly charge a tax even if people don't use my services or products. If the music industry gets to do it, then I should be able to do it, too.
And besides, if we the people get taxed for music, then we the people get to choose everything about where and how the money goes (at least in principle). And the companies would then be even more irrelevant. Do they really want to turn their revenue stream over to the government?!? These people are idiots.
It's almost funny that these cry babies are too stupid or too lazy to figure out a solution other than FORCING people to pay them for crap they don't want.
You have become irrelevant. Do us all a favor and GTFO.
To all music artists: please, please, please DO NOT sign any contracts with these people. Other, perhaps, more established artists are blazing the trails that you can follow to distribute your own music via the internet. It works. If the artists will only follow suit, we can all finally put the last nail in the music companies' collective coffin.
@BigDanInTX: umm, no. if you actually read what it says, they want to flat rate *everybody*, whether you download or not a $5 "tax" which would give unlimited access to everything in their catalog. it does *not* say charge per track/album PLUS $5 a month on your isp bill.
reading is fundamental.
either way it's a crappy idea.
Oh darn. And I used to like Warner Bros. Oh well.
Okay...admittedly I only just now read the article. I just read the title and saw RED and started typing.
The concept isn't terrible, but that means my grandparents would have this charge on their internet service and they can barely download email attachments...
Don't penalize 90% of the population just because you're losing money in an archaic distribution method.
Of the 66 Million DSL subscribers ([www.internetworldstats.com]) if even 50% of those either don't download music at all, that's still $165 million dollars they SHOULD NOT HAVE.
The MAFIAA claims it's protecting its artists. They should do it in a different manner than paying off lawmakers.
They make me Mad Panda...
I'd be all for this if it was opt-in program. I would voluntarily pay a monthly subscription for all you can eat music downloads that i can put on my f-ing ipod.
But, if you FORCE me to pay it, that just pisses me off.
Non story, this will never happen.
That has to be the cutest stickup in history.
As far as a music tax goes, there is no way this is, in ANY way, constitutional:
Section. 8. The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
How exactly does this A) provide for the general welfare, or B) tax everyone uniformly (as you're taxing those who don't utilize the service they're being taxed for?)
Ah the poor poor music industry, trying to fend off their inevitable and impending death.
In Denmark similar organisations already successfully imposed a tax on blank media, like cd-roms and are creaming their pants at the prospect of a tax like this.
Artists should realize they can make much more money by selling their music DRM-free online, completely bypassing the bloodsucking bastards, shutting down this farce once and for all.
Greed does crazy things to people. This will never work in a million years. If the RIAA is delusional enough to think they're "protecting artists", then the record industry will go down in flames even faster than it already is.
screw the record labels. sound shouldnt be copyrighted to begin with. all digital music should be free. if an artist is truly an artist he would just want his music heard, artists should only get money from concerts, and the record labels should all die.
@dwarfgoat: "I don't know about artist friendly. Maybe signed artist friendly. For those of us who produce and distribute our own music (and do get revenue from places like iTunes and eMusic, et al.) I don't see this working out at all for indie acts."
If well implemented, it could actually be better for you, and help indies level the playing field against the majors. Internet traffic is label-agnostic. If your song became a popular download, you would receive a larger share of the pie whether you were signed to a traditional label or not. Much like the ASCAP system in which composers who don't have publishing deals simply register as self-publishing, there's nothing stopping this system from allowing you to register as your own label, or not require a so-called label at all.
However it shakes out, it's obvious that the function of a traditional label is radically shifting. If you want to essentially hire a label to perform tasks for you that you yourself don't want to or can't perform in return for a share of your profits, that's your prerogative and the prerogative of any label that wants to sign you. But if you have no need for that, or no interest from a label, and become popular anyway, this system wouldn't discriminate against you just because you haven't signed a contract with a 3rd party to handle promotion, make t-shirts, make coffee, and do whatever else labels wind up doing in the future.
As an independent, this is the very best way for you to profit from your recorded music, because it allows you to distribute as much as you possibly can without some flawed or prohibitive charging system getting in between you and your fans. A 3rd party tracking systems takes care of that automatically. All you would have to do is produce great music and get it moved around the net as much as possible to get paid.
hell no. i'll go back to illegal dl's if my digital purchases are taxed
The cable companies choked on the $0.61 per user/per month extra fee that the NFL Network wanted them to charge all subscribers in order to get on the basic tier. I'm pretty sure that a $5 per user/per month extra fee that the cable/DSL providers would have to explain to their customers (many of whom don't know HOW to download music, legally or illegally) is an idea that would get chuckles in the Comcast, Verizon and Time Warner board rooms.
Till they start thinking how they can turn it into some kind of tiered-pricing scheme, that is.
All I know is that if this does fly, which I'm pretty sure it won't, they better give the option for people to opt out of this BS idea. I mean seriously....what's next... PepsiCo imposing a $5 tax on tap water and give you unlimited Aquafina? For Shame.....
Some clarifications are in order here. The "$5" they're talking about is an arbitrary placeholder, not a set amount. There is also talk of having it be opt-in -- If you didn't want the content you wouldn't pay the fee, or you could choose the ad-sponsored version. It is not a "tax" by any stretch of the definition.
This is really about trying to capture a fraction of the illegal downloads, which positively dwarf those of the iTunes store. They can do this if they make a legitimate easy to use service with unlimited selection, at a nominal cost. Under such a scenario, why would anyone waste time looking for virus-laden stuff of questionable quality on torrents if you could pay a small fee and get it legally? Shifting even a small percentage of downloads from the "dark side" of P2P would generate a huge pot of money that could actually make it to artists at all levels.
@ph15h: "hell no. i'll go back to illegal dl's if my digital purchases are taxed"
that's the whole point! They wouldn't be illegal if you were taxed at the ISP. Download as much as you want... the tax makes it legal, and the artists get a piece of the action.
@frigg: Yeah, that's good for those who actually DOWNLOAD music, but for those that don't, this is a big problem! I'm all for protecting people like my older relatives who have internet for emails, VOIP, and online games only (simple stuff).
It might be time to start throwing our CDs into the harbor. MAFIAA Tea Party style... ;-]