Special Report: Music Industry’s Lavish Lobby Campaign For Digital Rights

The music industry has spent tens of millions of dollars to lobby government officials worldwide during the past decade, but whether or not the initiative has helped to shape a viable legal and commercial framework is a subject of debate.
According to a Center for Responsive Politics analysis based on data collected from the United States Secretary of the Senate Office of Public Records (SOPR), the recorded music industry and the Recording Industry of America (RIAA) have spent over $90 million in lobbying efforts in the United States alone since 2000.
The total represents money spent after CD sales began to see steep declines in revenue as file sharing became more common. The music industry spent $4.0 million in lobbying in 2000, a figure which rose significantly to $17.5 million in 2009, according to the Center for Responsive Politics. The industry also has actively lobbied officials with the World Intellectual Property Organization (WIPO) and affiliated organisations, although data indicating how much it spent for these groups is not readily available.
The sum spent on lobbying efforts to enforce copyright protections reflects an effort to thwart file sharing that is more ambitious in scale compared to other media industry groups in the United States. The motion picture industry, for example, spent less than half of what the music industry invested in lobbying during the 2000-2010 period, according to the Center for Responsive Politics’ statistics. The RIAA and recording industry players have also spent over $50 million in legal fees for the industry’s lawsuit campaign intended to thwart illegal file sharing, according to tax filings and estimates by attorneys involved in the litigation.
“The music industry is spending more than other media groups,” said Dave Levinthal, communications director for the Center for Responsive Politics. “They have accelerated their spending to a much bigger degree.” There are some industries, such as health and pharmaceuticals, or automobiles, that have spent more on lobbying during that time but the music industry’s investment is unprecedented in media.
The music industry has also actively lobbied legislators in Europe to help influence digital file protection laws, although it is difficult to determine its total spending there since the information is not as publicly available as it is in the United States. Legislators in France and United Kingdom, where recording companies Vivendi and Virgin are based, respectively, have sought aggressive enforcement policies intended to limit or ban user accounts that are allegedly used for illegal file sharing.
Under the pending legislative groundwork for a graduated response initiative in the UK, alleged infringers would receive warning letters and could see disruptions in their internet access. Under France’s Hadopi law, a government organisation has reportedly begun to contact customers warning them that their internet access could be suspended if their ISP accounts are used to share media files without authorisation.

Lobbying has taken many different forms in the United States, while rules and ethical mandates represent a complex legal framework to work through, which is the case for other industries in the United States.
“I think that ethics reforms should prevent too much direct wining and dining,” says Sherwin Siy, deputy legal director, and a Kahle/Austin Promise Fellow at Public Knowledge. “A lot of that money goes into salaries, ad buys, travel, and the occasional party or event where some of that wining and dining takes place on a more distributed level, though again, ethics rules restrictions apply.”
While such far-reaching legislation such as the Digital Millennium Copyright Act (DMCA) and the Copyright Term Extension Act were drafted prior to 2000 in the United States, laws and mandates advocated by the music industry have become stricter since then, Siy said.
“There’s been a steady push for increased penalties for infringement, as well as presumptions built into the law to make it easier to win cases against alleged infringers,” Siy said. “New causes of action [for plaintiffs in US courts] have been passed, too, including an anti-camcording statute built into federal law.”
The US Higher Education Opportunity Act passed in 2008, for example, mandates that colleges and universities actively take measures to monitor for and limit file sharing by students as a condition to receive federal aid money, Siy noted.
“So there’s probably a fair bit that’s gone on even in the absence of something quite as flashy as some of the better-known efforts [such as the DMCA and the Copyright Term Extension Act],” Siy said.

New laws intended to protect and enforce digital music copyright as well as the music industry’s high-profile litigation campaign receive considerable attention and have generated significant controversy, yet the measures are but one part of an initiative to help the music industry make the transition to the digital age, proponents say.
“The music industry is responding to the digital environment in three basic ways: licensing repertoire in new ways that respond to what the consumer wants, public education to explain copyright laws and highlight legal services, and copyright enforcement to protect our rights,” said Adrian Strain, director of communications for the International Federation of the Phonographic Industry (IFPI).
“All three of these strategies are crucial, and it’s safe to say that we wouldn’t even have a digital business or be able to offer an answer to piracy if we hadn’t responded with all three,” Strain said. “However, none of these strategies can solve the problem of digital piracy by itself.”
New business models the music industry has developed during the past few years include new subscription models and access to digital music that is free for consumers, Strain said.
“Our digital business is way ahead of other creative industries, with 30 percent of music sales coming from digital channels,” Strain said. “But none of this commercial activity and innovation can succeed unless there is proper protection of music rights and effective intellectual property enforcement.”
However, copyright laws that enforce protections on a global scale are still necessary, but in parallel, more viable alternative business models need to be developed to collect royalties, said David Stopps, director of copyright and related rights for the Music Managers Forum UK.
“The music industry has moved too slowly in its attempt to create new business models,” Stopps said. “We need to make it much easier for new business models to get off the ground and to prove themselves.”
Major record companies licence digital services, but the terms involved are difficult to build a viable business model around, especially for startups, Stopps said. “You have to have a lot of money to do it and you have to have a lot of time. You would need a couple of years to license [the songs] and a couple of million in the bank,” he said.
“New startup businesses should be able to access all content under a compulsory licence for a period of, say, six months,” he added. “We have to make it easier for new business models to get access to content.”
Meanwhile, for some digital rights proponents, any kind of heavy-handed legal enforcement intended to limit content sharing between consumers is destined to fail, while alternative business models have been more than inadequate.
“The very first time a major music industry executive heard about Napster and got nervous, they turned left and went down and talked to their lawyers instead of walking out of their office and turning right and heading down to the business section,” said Corynne McSherry, intellectual property director [corrected] for the Electronic Frontier Foundation. “That was the fundamental mistake.”

Bruce Gain - ip-watch.org