Can entertainment embrace the e-revolution?

Matthew Tagg

Entertainment industry bodies such as the International Federation for the Phonographic Industry (IFP) and the Motion Picture Association of America (MPAA) have clamped down heavily on individuals using peer-to-peer networks to acquire digital downloads of music and movies. They have resorted to suing consumers who use these channels to get entertainment content, and have used their might to shut down companies such as Napster that promote file sharing.

The industry has taken these steps in the name of copyright protection in a bid to safeguard the revenue of content creators. Many commentators have also seen this as the industry's attempt to retain control over distribution channels and launch times to different markets.

The fact is that consumers' behaviour patterns are evolving. People want to view content on their terms via a medium that suits them - and it is unlikely that this will change. Rather than fighting the tide, there is an opportunity for the entertainment industry to embrace digital developments and find a way to make it work.

Enforcing restrictions

The entertainment industry's anemic response to the e-revolution has been to implement Digital Rights Management (DRM). DRM is a combination of hardware and software that works together to restrict users' ability to copy content, although it can extend to restrictions such as how many times a video can be watched etc.

Consumers, however, have rejected DRM because of the complications and additional hurdles it makes legitimate users jump over due to poor implementations. Cost aside, DRM creates more headaches for end users than unencumbered peer-to-peer content so the choice is clear.

As is often the case with developments in technology, the internet is playing a role in shaping the way we think and our behaviour patterns. Because of the global nature of the Internet, consumers are no longer satisfied with being told when they can view content. It is natural then that most are opting for file sharing instead of DRM-encumbered content because it is more accessible and they can get the content on their terms.

Restrictions cause piracy

A recent study in Australia revealed that the primary reason that Australians pirate content is not the cost but the restrictions placed on them by the entertainment industry. According to the research, delays in broadcast times are one of the major factors driving Australians to use internet-based peer-to-peer networks to download programmes illegally from overseas prior to their local broadcast. These findings debunk the myth that file sharers are criminals.

Need for constructive engagement

A number of options are on the table for a constructive engagement between the entertainment industry and Internet users. One approach would be to embed advertising in the content, providing an additional advertising revenue stream. Another would be to consider a licence-based approach where users would pay a fixed amount per month to download music and movies. This would be similar to a satellite TV model where users are paying a premium for premium content.

Yet another approach would be to impose a content tax on Internet Service Providers (ISPs). ISPs could provide stats on what was being viewed, and a percentage allocated to that content provider. For example, if the latest episode of Prison Break counted for 2% of total views, Prison Break content creators would receive 2% of the content tax.

Finding the happy median

Perhaps the answer lies in one or a combination of these approaches, but the fact remains that there needs to be a constructive engagement between the entertainment and Internet industries. What is not constructive is the entertainment industry's attempt to restrict digital downloads, nor its suggestion that ISPs clamp down on peer-to-peer networks. Firstly, the Internet was built on open standards and it is not the ISPs' role to police what users are doing with their connections. Secondly, much of the content exchanged on these networks is legitimate and shutting them down would not serve anyone.

The reality is that the Internet will continue to shape and change how we interact with media, and the answer is not to be overly protective and litigious. The entertainment industry should rather focus its efforts on forging alliances with ISPs and finding business models that will work for Internet users and content creators.