Saturday, July 10, 2004

Making P2P work for artists?

According to this story on ABC, peer-to-peer network providers are discussing giving revenues to artists whose music is driving P2P popularity.  From the article:

 "As the progression of the litigation [against P2P companies] moves on ... there will in fact be a return of profits to artists . . ."

". . . certain actions that are already providing a return of profits to artists. There are funds established, there are distribution methods being explored for moving profits back to artists."

 "In addition to that, there's obviously the potential for digital rights-managed content to be injected into search strings of users to choose those particular files, through which a direct relationship is established between the label, the artist and the fan."

Since major P2P software providers make their profits by selling advertising and bundling software shopping products (among other things) with their free software, it makes sense that a certain percentage of those revenues could be reserved for the artists that are driving users to use the software.  This, of course, does not address revenue sharing for film studios and software manufacturers, but once the precedent is set, it will be hard to stop the flood of people with their hands out.

The article sites that P2P software providers would also be looking to Internet service providers and Internet hardware manufacturers for contributions to the artist revenue fund because, they claim, that the demand for P2P services is what is driving the demand for service and hardware products.  I find it hard to believe that the ISPs or hardware manufacturers would be willing to give up any of their revenues, and if they were mandated to do so, I am sure that those additional costs would be passed right on to the consumer with a profit markup attached.

Assuming that payouts proceed (or are currently actually happening) it begins to beg the question of the validity of the RIAA lawsuits: If the artists are being compensated and the RIAA is suing on behalf of the artists, then what is the problem?

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