Copyright Business

'Long Tail' author Chris Anderson, and Duke University law professor James Boyle, discussed the economics of 'free' and the merits of the Creative Commons, in a BBC Radio programme yesterday evening. But to find out why the headline, I'm afraid you'll have to read the whole article.

Anderson, who uncovered how digital economics means that selling a large catalogue of niche products in small volumes can be profitable, has a new theory. That businesses can give up to 90 per cent of their products and services away free, and still make a profit.

Taken at face value, Anderson's theory will cause apoplexies among music and entertainment industry executives. But when you think about what he says more carefully, he is

A report from the management consultancy firm Booz and Company says that the losses to the telecoms industry from a 3 strikes / graduated response measures, would be much higher than any potential gains to the music industry.

The report, entitled Digital Confidence, securing the next wave of digital growth, carries out a calculation for a hypothetical scenario of terminating internet access to persistent filesharers in the UK (I stress it is a hypothetical scenario, because the UK government has not said it has plans to implement the 3rd strike - termination of access).

The report says:

"One aspect often overlooked in public discussions on the merits of "three strikes" is the damage to the overall digital economy as the result of disconnecting significant numbers of users from the Internet. Implications of "three strikes" would need to be understood more holistically. A high-level sensitivity calculation, for the

Brian Eno, the British musician who came to fame with the 1970s rock band Roxy Music, has accused the music industry of being 'lazy' in respect of the Internet, and still hanging on to old ways of doing things instead of moving forwards. Speaking on the Today Programme on the BBC's Radio 4, he also said that young musicians understand perfectly how to use Internet-based services to promote their music and are comfortable with doing so.

I put these comments here simply because policy-makers are frequently proffered elderly musicians who plead that the Internet is ruining their careers and reducing their royalties on which they depend for a pension. Those who are getting on with it and adapting their ways, are unheard at a political level - but they are the ones whose voice should be heard.

Mr Eno is a highly-respected music industry insider - and considered by many to be an 'elder' of the rock music industry - who is speaking out. He is also putting his money where his mouth is and releasing his new music on the Internet first - before putting out a CD.

His comments also illustrate how the music industry is divided between those who welcome the Internet and the opportunities it brings, and those who still seek to protect their 20th century business models. It is also important for policy-makers to recognise this division, and seek to create policies that help the industry as a whole to move forward.

Report from the ISP Future Content Models and Enforcment Strategies Summit 2008, Kensington, London

The Motion Picture Association (MPA) - the Hollywood trade association - has weighed into the debate around an Internet levy to pay for publicly-funded entertainment with a clear 'no'. Speaking at the ISP Future Content Models and Enforcement Strategies Summit 2008, Ted Shapiro, MPA legal counsel, warned against "turning the Internet into one big compulsory licence". Expanding on what he meant, he said "you pay your ISP a few Euros per month and we all get a cheque.

The possibility of a levy on the Internet is being quietly floated by a number of people as an option to deal with file-sharing, and to generate money for content production. I have mostly heard it from members of the rights-holder community, such as the British music industry, and the French cultural lobby. The people more likely to oppose it, are the ISPs themselves - and that could make for an interesting partnership option for the MPA.

The Walt Disney Co, one of the leading lobby-ists for 'riposte graduee' in the EU and in France, has had a "fantastic quarter" for the first three months of 2008. According to Reuters. Disney outperformed the analysts expectations, with a a 17 per cent rise in operating income, and a 22 per cent rise in profits. Its broadcasting arm, ABC, has claimed a 'double digit' rise in advertising income. The company was rewarded by the markets with a 1.6 per cent rise in the share price on the day the results were announced.

Analysts are even saying that Disney is "recession resistant" and is showing more signs of a going through a boom market than a troubled one.

The question for the legislators should therefore be whether such a firm really needs political support like the French 'riposte graduee' proposals, to underpin it, especially to the extent of changing some fundamental European legal principles such as data protection and mere conduit?