U2 Band Manager: Piracy Has Made Tech Companies, ISPs Rich

Paul McGuiness says that the free content illegal file-sharing has made possible is part of an overall “commercial agenda of powerful technology and telecoms industries” who are making “vast profits” at the expense of copyright holders.

For years now Paul McGuiness, longtime band manager for the famed rock group U2, has argued that ISPs share in the blame for the damage illegal file-sharing has done to the music industry, and that more importantly, they’ve been rewarded handsomely over the years at the music industry’s expense.

He’s said that although ISPs claim to be “neutral bystanders,” they’ve contributed to the “spectacular devaluation of music and the consequent turmoil in the music business” by refusing to aggressively sanction illegal file-sharing customers.

It’s an argument he reiterated recently in article for GQ magazine.

McGuiness points out the fact that ever faster connection speeds, for which ISPs can increase subscription rates, are really only needed by those who illegally download copyrighted material like music, TV shows, and movies.

“Do people want more bandwidth to speed up their e-mails,” he asks “or to download music and films as rapidly as possible?”

He says that the way to deal with the problem of piracy is to first challenge the myth of “free,” the notion that “free content is an inexorable fact of life brought on by the unstoppable advance of technology.”

McGuiness says that free content is part of a “commercial agenda” of powerful technology companies and ISPs that need content to fuel demand for their products and services.

“Look at the figures as free music helped drive an explosion of broadband revenues in the past decade,” he says. “Revenues from the “internet access” (fixed line and mobile) business quadrupled from 2004 to 2009 to $226bn. Passing them on the way down, music industry revenues fell in the same time period from $25bn to $16bn. Free content has helped fuel the vast profits of the technology and telecoms industries.”

It’s actually a fairly reasonable argument in a way for several reasons.

The first is that the memory storage capacity of most portable music players, the iPod in particular, is quite large. A simple 8GB iPod Touch would require upwards of $2000 worth of legally purchased music. The 64GB requires $16,000 worth! Nobody is spending that much money on music to fill it. They’re downloading it illegally online or sharing music libraries with friends and family. Apple has to know this, but still insists on increasing the memory storage capacity so it can charge customers more.

The second is that ISPs do make a habit of advertising ever faster connection speeds for which they are able to charge you more. Most people just use their connection to surf the web, check their email, or stream music and the occasional YouTube clip. For all these tasks a simple 256 kbit/s connection is fine and not the top tier 2Mbit/s. It’s really only illegal file-sharers that need the faster connection speed, especially with HD and Blu-Ray content available online these days.

McGuiness thinks the solution is for govt’s to enact legislation that forces ISPs to fight illegal file-sharing on their networks as has happened in countries like South Korea, France, the UK, and most recently, New Zealand.

“I am convinced that ISPs are not going to help the music and film industry voluntarily,” he says.

And he’s right. The only problem is trying to place the blame on ISPs for the inability of copyright holders to adapt to a new business model.

Stay tuned.

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