Warner music proposes universities subsidise private record companies

Taking the ever-popular 'nice place you've got here, shame if something happened to it' usual background threat from the RIAA companies, Warner Music have developed a new model - suggesting to American universities that, if they bought a "licence" to cover anyone on their campuses who may or may not be downloading music, then they'll stop suing the universities.

You can see the attraction - Warners get more money than they could ever earn legitimately, the universities are out of pocket but no longer have to waste resources dealing with RIAA companies. Sure, it's effectively being made to hand over a large sum of cash to stop being bullied, but the record company line is 'what means more to you - keeping your lunch money or losing the threat of having your head pushed down the toilet'?

This, though, is just stage one: if they can persuade the universities that it's right and proper that record companies get cash in return for just the potential risk of downloaded pirate music, it will be a short step to arguing that anyone who logs on to the internet be treated in the same way. So, hey, perhaps the ISPs should pay a lets-not-call-it-a-tax for all their customers, right?

You'd have thought the labels might have quietly let this idea drop after the chilly reception it got years ago - especially since it seems to run contrary to the standard RIAA line. If people are covered by a blanket payment for downloading 'free' music, then doesn't that actually make it okay for them to take what, hitherto, have been unlicensed files? Doesn't it send that message - that music is free, not something to be paid for and cherished - that the RIAA has been trying to counter for the last decade?

And if it's fine for someone in Texas to download tracks with abandon, it follows that it must be fine for them to share the same tracks. How would the rest of the world's labels feel about the whole of America suddenly allowed to share their music online? Oh, sure, it might only be in America where the ISP tax allows the music to be sucked back down for free, but the creation of large pools of music online is going to be tempting for the French, the British, the Icelandic and everyone else.

Then you've got the likely reaction of services who have been working to create business models around legal music - who will want to listen to an ad-supported legal download if they're already paying for every tune they can think of free via the ISP tax? The music industry has been hoping for an iTunes killer for years; this would not just kill iTunes, but We7, SpiralFrog, Rhapsody, ZuneStore and anyone else who has tried to work with the RIAA companies.

Of course, there is one upside for the labels - if they're raking in money from a blanket agreement, they're not going to have to be quite so diligent in making sure these royalties flow to the artists. If someone buys an OMD track, time and money has to be invested in making sure Andy McCluskey gets his quarter cent; if the cash is flowing from a blanket payment, it's going to be much harder for artists to follow a trail from their music being downloaded to seeing payment.

A small advantage for the music industry, in the short term, but at the cost of completely destroying their own businesses. Only a suicidal business would embrace such a move. Does nobody in the RIAA have any ability to set aside their greed for gold, even in their own interests?