Why a Music Tax Is a Bad Idea 194
An anonymous reader writes with a followup to the story posted last week about Warner Music's plan for a music tax for universities. "There's been some debate about this plan and Techdirt has a detailed explanation of why a music tax is a bad idea, noting that it effectively rewards those who failed in the marketplace, punishes those who innovated and sets up a huge, inefficient and unnecessary bureaucracy. Meanwhile, plenty of musicians who are experimenting with new business models are finding that they can make more money and appeal to more fans. So, why stymie that process with a new bureaucracy that simply funds the big record labels?"
a new bureaucracy that simply funds the big record (Score:5, Interesting)
You answered your own question:
"a new bureaucracy that simply funds the big record"
If you were a big record company that is the greatest solution ever. They have to do nothing and roll in the cash at the government and end users expense. Straight to step 4) profit.
Why our governments are even considering it is a question we should ask every law maker out there.
Why the nation of the Boston Tea Party is even considering it? Is an even greater question.
Here's a better question (Score:4, Interesting)
Why would any self respecting university volunteer itself for this?
I know my alma mater would never put up with this and I suspect most other universities have the same sense of dignity. This plan cannot possibly succeed.
"The Art of Taxing" (Score:5, Interesting)
I read in "The Economist" a while back, that the "Art of Taxing," is like plucking a live goose for feathers.
You want to get the maximum amount of feathers, with the minimum amount of fuss.
So, try to sneak in a small tax, that nobody notices, or can do anything about. Or pick on a small minority, and whack them with a big tax.
Here we have Warner asking for a small "taste" from everybody.
I prefer to "eat alone."
Should be tagged... (Score:2, Interesting)
Re:While we're at it... (Score:5, Interesting)
Funny thing is in my neighborhood you can frequently hear some birds chirping like they're reciting car alarm tones and the most hilarious part is they memorized the entire alarm cycle and will do so in the exact order on common alarms.
I'm sure birds in other places have done the same thing, but in order to find out requires actually going outside. :)
so $50 /m for all the movies and games that you wa (Score:3, Interesting)
so $50 /m for all the movies and games that you want? Does that void laws about taking cams to the movies I payed the forced tax so how can I fined for braking the law? OR going to a bast buy taking a game and just paying $5 $10 for cost of game media and seeking it out of the store? I not shoplifting I just paying $5 $10 to have the game now and not have to download 4GB or more of the game for free under the tax.
Here's one (Score:5, Interesting)
He's been on an independent label since 2000 (he's co-owner of it now I think) and in that time he's sold maybe 300,000 units total. Is that a lot compared to artists on major labels? No, but he makes $7 per CD sold and lots more money doing live shows. He said in an interview that he was offered $150,000 to make an album for a major label and he turned them down.
He's not making nearly as much money as Jay Z or some other big name rapper, but he has full control over his production and full control over his music, something he says is more important than money. I'll leave you with a piece from an interview:
Lots of people, not just the record labels, told me that this wasn't going to be lucrative or that no one was going to care, but I was fortunate enough to believe in myself and say, listen, I'm going to do whatever I want, with or without the express permission of other people. There's no gatekeeper for me. I don't need somebody to co-sign me to put me on.
Anyone who has supported me has never been because I twisted their arm, it's been out of the goodness of their own heart because they felt the truth in the music. So I think in terms of marketing myself, I don't need to create a rap persona, or a different personality in order to sell records. For me, it's just as simple as getting the word out and getting the music to people. The music sells itself, and the message sells itself.
...
I definitely would like people to purchase The 3rd World in stores and purchase it online, but I think it was more of a way for me to express my frustration with the music industry. I can't believe they have the audacity to call anybody else a thief. As much money as they steal from artists, as much as they don't have a health care program for any of their artists, and I look at stuff like that and I'm disgusted. They go to these conferences and tell kids, "How can you steal a record?" I'm like really?
Full interview [wordpress.com]
Re:Money for a failing industry (Score:3, Interesting)
The "music business" isn't a viable business any longer. Period. There is no "adapt". You can't adapt to a situation where the sale of your product is undercut by distributors passing it out for free. So any idea of selling recorded music has got to go.
What could possibly compensate artists? Patronage is a bad idea that was stamped out with the death of feudalism. Doing it for ego-reasons - because the artist feels it has to be done - doesn't feed the children or pay the rent. Any sort of tax is going to run into massive fraud and evasion. Trying to give the music away and sell T-shirts or hope for huge concert sales only helps a very few artists. Most artists and performers are going to be playing bars and clubs for pocket change and drinks. And that is the way it is going to be, because music is now free.
Any semblance of value in recorded music has pretty much been destroyed. Partly by record companies deciding what to market based on what was selling last year. Partly by really awful bands commanding the same prices as top performers. Partly by piracy exerting really strong negative pricing pressure. Might as well face up to it, you can't compete with free and win.
That seems to be the open source message, right?
Re:a new bureaucracy that simply funds the big rec (Score:4, Interesting)
No, they were protesting against a tea monopoly run by the East India Company that the British Government was trying to force on them. They only lowered taxes to force their competition out of business so they could raise them again later.
This music tax is remarkably similar to what the Boston Tea Party was in protest against.
Possibly Incorrect Assumption (Score:5, Interesting)
Re:More reasons why it's a bad idea (Score:5, Interesting)
Re:Possibly Incorrect Assumption (Score:3, Interesting)
Yes they would, because even with some sort of taxpayer-supported system the only fair way to get it done is to have some sort of tracking. Otherwise what's to stop me--a person with absolutely no musical talent--from banging a spoon on a pan for 3.5 minutes, chanting some nonsense and calling it music to not only get an ill-gotten share of the pot, but to dilute actual, talented artists' shares as well? And how do we determine how much more (if any) Artist A with 50 songs registered with the copyright office gets than Artist B with 1? Would it matter if all 50 of them were pot-spoon-bang-chanting and the other one was one of those songs that pervades a culture?
Moreover, unless the copyright registrations become free it's entirely possible that good, popular artists would never make their money back without such a system of tracking. There's only so much money going into the pot; the more ways it has to be split, however that is determined, the less there is for everybody. I could pretty easily see it being less than $45/song it looks like it would currently cost to register. And who gets the money, anyway? If I write the song and copyright the lyrics, do I get a share of the pot from somebody else recording it or do they buy it from me?
Once you introduce any sort of tracking system, which I hope you'd agree would be a requirement, the need to get exposure to a wider audience (aka marketing) is just as strong as before. Digital music essentially eliminates DISTRIBUTION costs of music, but other things still cost money. Even if production and marketing cost less than before--and they may or may not, depending on what we're talking about--they're still just as important.
It's not that I'm morally against an idea like this, but I can't think of a fair implementation. Whenever I run through the list of problems in my head and try to come up with a solution, it's essentially a market-based one. That's basically what we've got now; rather than taking every taxpayer's money and completely changing the system, perhaps we'd be better off trying to come up with ways to make the problems we're having today disappear. Start with disbanding the RIAA; all the major record labels banding together for ANY purpose smells fishy to me, legally speaking. Since they've been charged with (and convicted? or did they settle?) price fixing a number of times as well, it's pretty clear they ARE conspiring together.
Beware! (Score:2, Interesting)
Re:and a bigger why.... (Score:3, Interesting)
Why can't we just agree that taxes in general are a bad thing?
Because that just is not the case; it is an oversimplification. From the rest of your post I take it you live in the US. A lot of US-ians never take the time to see if their mantra of "This Is The Best Country In The World" is actually correct by comparing their own country to other countries. When you compare the US to other countries you will see:
Why am I bringing all of this up in a taxes related context? The end of Soviet Russia has proven that too much tax (everyone gets the same, in theory) did not work. There was not enough incentive. The total opposite, having as little tax as possible, which you sort of see in the US, is also not working correctly.
A lot of the countries that are higher on the happiness list (or lower on the crimes etc. lists) have way higher taxes than the US. This allows for instance the authorities here in NL to prevent or counter-act ghetto-forming by opening up 'buurthuizen' (neighborhood houses) in which people can follow courses etc. This leads to less crime and more people doing something useful in our society.
Is the government as productive with money as a private business? No. But there are things better left to government. Do I like paying tax? No. Would I rather pay less and live in a less pleasant environment? No. So I pay tax and I am glad for the system we have here in the Netherlands. But then again, our politicians seem to be a lot less corrupt ("campaign donations" here are frowned upon) and we have to reach consensus because we do not have a winner-takes-all system like in the US.
The bottom line: please look beyond your own country to see how taxes can add to the welfare of people paying those taxes. And then: please try and change your political system in a way that taxes are put to better use. Sorry if I seem to be patronizing, but I rather see the US turn into something good that something worse; and that makes me care.
Re:and a bigger why.... (Score:4, Interesting)
It's not just the music tax that would be bad, it's almost all of them.
That's strange. In Denmark, if you work full time at minimum wage, you're paying at least 40% of what you earn in taxes. Get a well-paid Code Monkey position and you're looking at something like 50-60%. On top of that, there's 25% sales tax added to everything (meaning 20% of what you pay for goods is sales tax). And there's heavy charges added to certain goods, such as cars.
Yet, we:
If taxation is bad, how come Denmark is such a great place to be?
Re:and a bigger why.... (Score:4, Interesting)
In my experience, the government tends to handle resources at least as well as private corporations. It's just that failure to do so is often more obvious when it's the government (exceptions exist, such as the current meltdown). Prominent examples include health care, energy, public transport, banks, pretty much all manufacturing industries.
Seriously, it's ridiculous how poorly most "free market" corporations handle their affairs, and how corrupt they are. This whole "government is evil, free market is good" idea just doesn't work if you look at the actual reality.
You're missing the point. The problem isn't that government is especially inefficient. The problem is that there is no economic pressure on the government to improve the product. Computers are a good example. An IBM PC cost about $5000 in 1981 when it was released. Today you can get a laptop that far exceeds the original PC for 1/10 that price, and that doesn't even account for inflation. The market exerted pressure to improve the product. They're not made in the US anymore, and they aren't made of armor-plate steel like the old PC, but that's not what makes a computer useful. If it were the government making PCs, we'd probably have 386's about now, still in the same heavy case, and still costing $5000. Keeping the cost at $5000 despite inflation would be hailed as a hallmark of "business-grade efficiency", but you can plainly see it would really be a dismal failure to innovate. Things the government does just don't improve like market-driven things do. The government is just as inefficient as business, but it continues to back the same horses forever, no matter how much they lose. In this day when soldiers are issued polypropylene long underwear and polyester fleece jackets, we still have wool subsidies based on the value of wool as a resource for national defense! I won't even start on the repeated bailouts of various domestic auto manufacturers...
Re:More reasons why it's a bad idea (Score:3, Interesting)
Aside from violating the law, there isn't much we can do because politicians were never in it for us; they're in it for themselves and will do anything they can to make more money and stay in office.
Just as the parent said; I violate the law because I do not agree with it. I have written my congressmen numerous times and copyright is still at 90 years and I still can't download software from defunct companies or break copy protection on legally purchased software. Until things change, I will violate all I please. I do purchase movies, music and software from companies who don't take advantage of their customers but I have no qualms of stealing an EA game, for example.