Culture flat rates are a horrible idea

Culture flat rates are named both in the Netherlands and in Germany as a solution to the problem of copyright piracy.

The idea is to have everybody pay a set amount of money each month so that they can download all they want and redistribute that money among copyright holders to compensate them for their work.

This stems from the notion that copyright holders deserve some payment for their work and that the current repression being employed to uphold the dysfunctional copyright system, is unacceptable.

It is a horribly bad idea on a great many levels.

1. It cedes to the copyright industry that piracy is an actual problem. It is not. Current piracy does not in any way threaten the creation of new works and in many ways is expediting the switch to new ways of producing culture and new business models.

2. A (semi-)government run systems such as this one removes all entrepreneurship from the production of cultural products and in doing so also removes all innovation. The mediocre will be best served by such a system and those who want to go the extra mile or go into wholly new areas will be hurt.

3. A tariff system by its design works in favor of the old and not the new. New entrants will not have made their arrangements to participate and may never do so because of other inhibiting conditions. People creating wholly new cultural works (DJs, mashups, all manner of interactive experiences and games) may find themselves falling outside of the categorizations on offer. This while the old sit back and reap the rewards for efforts form the past.

4. What should be the most important consideration but is usually left as a detail to deal with later: organizing such a system is practically intractable. Who will compensate the Americans, the Chinese, the Japanese, the Brazilian underground movie industry, the bloggers for their writing and the musicians on Soundcloud for their music?

The current organizations tasked with redistributing these tariffs on music played on the radio or in cafes (BUMA/STEMRA in the Netherlands, SEBAM in Belgium) have proved themselves to be mostly corrupt, opaque, poorly organized and exclusionary. It is an illusion to think that a newly established organization will fair any better.

Update: After thinking it over a bit more and reading more misguided German business model ideas for creative production, I think the next three requirements could be used to make a culture flat rate work:

  1. Blanket. A culture flat rate would need to be truly blanket to solve a lot of problems. If it is not, the difference with Spotify or Netflix streaming is zero and it would seem odd to codify into law what is in fact just another business. On the other hand, if the goal is to solve the copyright problem for everybody, a flat rate scheme should ensure that I cannot be sued anymore for any copyright infringement. That was after all the problem to be solved. With current international intellectual property and trade treaties this seems unlikely to happen.
  2. Voluntary. A flat rate should be voluntary. I should not be forced to pay into a scheme I don’t want to or which is of no use to me (like the GEZ). Styled this way, the flat rate would be a kind of legislative insurance for users to prevent getting sued for nonsense and the funds collected could be used to support a couple of starving artists. Though there seem to be altogether too many of those in Germany. This approach would also demonstrate actual market fit of the scheme.
  3. Cheap. A hard requirement on any scheme would be that a flat rate needs to be cheap, cheaper even maybe than the current tv license. That is the only way to ensure incentives for creators to create new products and new business models. If the flat rate is set too high, it risks becoming a cash cow for a sick industry and further stagnate developments in an already conservative country.

Will any of those happen? Reading the proposed business models on an upcoming event, I’m rather pessimistic.

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