"iPod Tax" to Combat Online Piracy

What an asinine idea.

MP3 Player Tax Considered in the NetherlandsA new law is being considered in the Netherlands, the so-called "iPod tax", that would be added to the cost of purchasing any digital music player. The assumption is, some music on every portable MP3 player is illegally downloaded, therefore, the music industry should be compensated.

What a great way to piss off customers and encourage massive file sharing. Quite frankly, if I was forced to pay for assumed P2P activity, I would immediately take advantage of such services to meet all my music needs.

The approach being considered is similar to that taken in the 1970's, when a tax was created for blank audiocassettes. Of course, such cassettes were made specifically for the purpose of duplication. MP3 players, however, host both legitimate and illegitimate media.

The tax law is gaining interest in the UK as well. A similar law was proposed in Canada last year, but was shot down. At least Canadians "get it."

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Comments

This is very interesting! In one sense, I do understand the idea behind it, and it's kind of like, "well, if people are doing the illegal activity, and we know that, why not get some sort of reimbursement for it?" One might argue that if there is a deterent placed on something which allows illegal activity, then perhaps it will discourage that illegal activity enough so that the tax will eventually be lifted--tax is gone, illegal activity ended--all are happy.



Then again, even if, for some strange reason, the tax discouraged illegal downloading, instead of encouraged it, would they ever lift a tax like that because of that? They might lift it if sales plumetted, or people protested, but lift a tax because it was effective in achieving its goal? Has that ever happened?



So then what is the point of the tax in the long run? Besides to give money back to whoever it actually gives the money to? As it is more than a mere tax (it's a punishment of sorts), it should have an ultimate goal in mind (and if ending pirating is not going to happen, then what?).



It's also bringing up the issue of a mass punishment for something not everyone is doing. Is that fair to do? No...but it's done all the time. Even grocery stores warn you that if you leave the carts in the parking lot (instead of in the little closed-in area meant for returned carts), some may become damaged and the store consequently will have to increase prices. "Keep prices lower--return your carts."



Even if we were to say this tax made sense, we were for it, whatever--where does the "tax" money go to? If it's the musicians ultimately who are suffering, then how would the tax money be distributed to them? Or is it going back to the large pool of "music industry" anyway? And what is that? And where is this pool going? What companies? How are they compensating the artists? And would they only compensate artists in their own country, even if a large portion of pirated music is from another country?



Having said all that, you, Mike, raise the issue that would see the most direct and immediate effect of this tax. Many people would feel justified to download music illegally. People who download illegally would continue to so so(why would they stop now?), and people who never did before, might now feel the ethical right, having "paid their dues" to finally download illegally also. After all, it doesn't seem so illegal, if you've already paid for it, in a sense. Kinda like you bought a subscription package right as soon as you purchased your ipod and paid that extra $235 for your mp3 player. (yeah, i thought the tax you were talking about might be like $5 or something, but when I realized it was talking hundreds of dollars, that made it even more of an issue)

Jenny,
You raise many good points. I would bet that the tax income generated would be split up among major record labels based on some kind of market share calculation. Many massive dispersions of revenue resulting from lawsuits are handled this way by the RIAA, representing record labels, and The Harry Fox Agency, representing music publishers.

The point you raise regarding artists is a great one. I'm not sure if any of the tax money would ever make its way to artists. In fact, I would wager they do not. Record labels would probably argue that it would be too complex and too costly to itemize, assign, and pay out tax royalties based on industry performance and individual agreement terms, and they'd be somewhat right. It's an unfortunate fact.

Thanks for your great comments, Jenny.

-M

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