“Having failed to stop piracy by suing internet users, the music industry is for the first time seriously considering a file sharing surcharge that internet service providers would collect from users,” Frank Rose reports for Wired.

“In recent months, some of the major labels have warmed to a pitch by [consultant on digital strategy for three of the four major music labels] Jim Griffin, one of the idea’s chief proponents, to seek an extra fee on broadband connections and to use the money to compensate rights holders for music that’s shared online,” Rose reports. “‘It’s monetizing the anarchy,’ says Peter Jenner, head of the International Music Manager’s Forum, who plans to join Griffin on the panel.”

“Griffin’s idea is to collect a fee from internet service providers — something like $5 per user per month — and put it into a pool that would be used to compensate songwriters, performers, publishers and music labels. A collecting agency would divvy up the money according to artists’ popularity on P2P sites, just as ASCAP and BMI pay songwriters for broadcasts and live performances of their work,” Rose reports.

“In a 2004 white paper, the Electronic Frontier Foundation called for it to be applied to file sharing, but the Recording Industry Association of America immediately dismissed the proposal,” Rose reports.

“Things are different now. ‘The labels are beginning to like the idea of an access-to-music charge,’ says Jenner, who once managed Pink Floyd and the Clash, ‘because they’re increasingly aware that their current model is broken.’ U.S. music sales, which peaked in 1999 at nearly $15 billion, dropped to $11.5 billion in 2006. Last year’s figures are still being tallied, but with CD sales cratering and online sales overwhelmingly dominated by singles, the only question is how far they’ll fall.”

Full article here.

The music industry’s current model is not broken, it’s being fixed — by Apple. The old model was an illusion. The music cartels grew fat on artificially inflated profits from CDs because they overcharged for bundles (albums) for years.

Massive amounts of undeserved revenue is a broken, unsustainable model that the marketplace will eventually correct. Now that people can buy music a la carte and choose exactly what they want and not be forced to pay for music they don’t want, the music cartels think something is broken. The only thing broken is their stranglehold over consumers.

Now that they actually have to develop product that consumers want to buy, instead of forcing people to buy a load of stuff they don’t want in order to get a few good nuggets, they’re shocked. “Hey, where’d all of our free money go?!”

Well, too damn bad. That extra bundling cash is gone forever, boys. Now you have to work for your money. Imagine that.

Next up: The cable companies who massively overcharge consumers for bundles instead of allowing their customers buy only the channels they want. They’ll be shocked, too.

As for the main issue of this article: trying to correct the issue of the theft of music, should ISPs – meaning all of us – have to pay a surcharge for piracy?