Google has told two music industry trade groups it would have to charge a small fee to to help them track down pirated material more efficiently, reports CNET’s Greg Sandoval.
If The Price Is Right
Google said it could help – for a fee of $5 per 1,000 queries. At that rate, 1 million searches would cost $5,000 and 1 billion searches would cost $5 million. The Google product used in these queries would be Safe Search. Google would not charge to remove links to infringing content, but it would charge to search for those links.
Record labels happen to be in a better-than-usual negotiating position. According to a September 14 Billboard report, Google is working on a digital music store and service that would require more than the typical licensing deals from content owners. The pitch being given to labels described not only a standard download store but a music locker from which users could stream their music collections. Labels may be more likely to sign on with Google for such a service if they get a bit more help in dealing with piracy aided by the company’s search results. (CNET)
In Europe
France has an interesting approach to dealing with piracy: subsidies for music subscription services. The plan has won European Union approval. According to Reuters, French residents who purchase a card to download music from subscription-based music platforms will pay half the normal one-year price of €50 ($70). The French government will pick up the other half.
In USA
Let’s put aside the facts the French government is effectively setting prices in the music subscription market and giving a handout to music companies. The latter isn’t all that unusual, actually. Government handouts are common – just not in the creative industries. Recall the “cash for clunkers” and first-time home buyers credits offered by the U.S. government in 2009. The creative industries get copyright protection and assistance with fighting counterfeiting but tend not to get outright subsidies.
First, let’s look at the price. A lower price will help nudge this program forward. At $70 a year, the music services covered in this deal would be $10 more than a U.S. service’s PC-only streaming option that goes for $5 per month. In the U.S., the mobile option raises the price to $10 per month, which is far more than the prices given by Reuters. In France, for example, Spotify Premium (which includes the mobile option) costs €10 ($14) per month, which comes out to about $168 per year. But since the French government requires participating services to lower their rates, it’s possible $70 a year could cover a mobile option, too. So, French consumers could end up paying just $35 a year for a subscription service with a mobile offering. That’s big savings – if the services go along with the government’s desires for lower pricing.
Second, let’s consider the quality of the services being offered. The effectiveness of this program will depend not just on price but on the quality and desirability of the music services. Consumers won’t sign up for music services just because they get to pay half the normal price. Half of too much can still be too much to pay. And the quality of the typical subscription service is really the problem. They don’t have a value proposition that resonates with the typical consumer. Will a government subsidy change that?
In the end, government backing of subscription services will likely have some value through increased consumer awareness. The lower price will help.
Read on the full article here
