Britain’s Digital Economy Act is symptomatic of the entertainment industry’s flawed business model.
A little over a month ago, Britain’s Digital Economy Act was set into place; one of the major ramifications being the disconnection of internet access of households suspected of illegally downloading content. The reaction, of course, has been met with great protest by the many and heralded by the mighty.
The basis of the act is, of course, to protect copyright infringement and recover the entertainment industry to old profit margins. However, Cory Doctorow recently discussed why the war on downloading approach will not work:
Because disconnection for downloaders will only serve to alienate entertainment industry customers (remember that the most avid downloaders are also the most avid buyers – “most avid” being the operative word here – the 20% of customers who account for 80% of sales, downloading, concert tickets, box-office revenue, DVDs, T-shirts, action figures, etc). And because those who download most avidly will simply change tactics.
What are these new tactics Doctorow suggests? The act looks to exploit a loophole in the torrent/downloading community, whereby users’ ip addresses are not hidden and easy to track. The solution is easy for users encrypt/hide your ip address. While this has been previously a more expensive/tricky task, the number of free or cheap anonymizing services continues to grow.
This leads us back to the entertainment industry’s copyright/copy infringement business model. What the entertainment industry fails to understand is that technology changes social activities, ruling some activities outdated. (How many of us ride a horse to work?) Downloading and streaming is an activity that will continue to grow in future generations. As opposed to spending their time trying to save an old business model, they need to think about how they can exploit downloading technology and sharing to bolster a new revenue stream.
Image via ModernHumorist.com