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Movie and record labels are overjoyed at the support they're receiving from the British government

Late in October DailyTech reported on the new three strikes piracy legislation proposed in the United Kingdom by Britain's majority Labour Party.  Under the legislation those caught pirating would receive two warnings, then would be cut off from the internet.  The real headache, though, is how to police the traffic and enforce the provisions on ISPs and consumers.

Despite mass objections from telecoms, citizens, electronics experts, law enforcement officials, and members of the minority conservative and socialist parties, Labour Party officials have blazed ahead with a framework to allow the legislation to be enforced.

According to Labour Party leaders, the government is planning on handing the expense of the Digital Economy Bill down to taxpayers.  That expense is estimated to be approximately £500M (approximately $800M USD).  On average, that works out to more than £25 more a year ($40 USD/year) per internet connection.

And that's considering that the government is counting on the bill reducing piracy enough to increase media revenues by £1.7B ($2.72B USD), leading to £350M ($560M USD) extra in VAT tax revenue.  If that increase isn't realized, British taxpayers could find themselves on the hook for over $1B USD in enforcement expenses.

The initial letter writing campaign is predicted to cut off 40,000 citizens from the internet and cost £1.40 ($2.20 USD) per subscription.  The government appears to have purposefully neglects to include possible economic losses based on citizens being taken offline in its estimates.

Charles Dunstone, chief executive of Carphone Warehouse, whose subsidiary TalkTalk is the biggest consumer provider of broadband in UK, is flabbergasted at how the punitive bill is gaining so much traction.  He states, "Broadband consumers shouldn’t have to bail out the music industry. If they really think it’s worth spending vast sums of money on these measures then they should be footing the bill; not the consumer."

Still the media industry is cheering the British government's decision to obey their commands, despite the taxpayer expenses and objections.  Writes the Department for Business, Innovation and Skills, an industry trade group, "The overall benefits to the country far outweigh the costs."

They argue that movies like X-Men Origins: Wolverine and Star Trek have been pirated millions of times, amounting to millions in lost revenues.

And it certainly helps their argument that in the UK, like in the U.S., the media industry spends enormous sums on legal representation and government lobbying efforts.  As the growing conflict in Britain is proving, if there's one lobbyist power in the UK and U.S. that's perhaps greater than telecommunication firms, it's the media industry trade groups.

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Recording industry vs. movie industry
By Targon on 12/30/2009 7:05:22 AM , Rating: 2
The biggest problem with these things is that it lumps music together with movies, and there are HUGE differences between them.

The recording many people does it take to make a recording compared to a movie? Yes, sound rooms DO require an investment, and the engineers necessary DO earn their money. You then have the artists, being the ones who really deserve the bulk of net revenues from sales.

Movies on the other hand require a MUCH larger investment, both in terms of people, special effects, etc. The costs are HUGE for making a movie.

Now, when it comes down to it, just from these two basic glances at the industries, the movie industry REALLY needs to see more money in terms of revenues just to break even. It makes SENSE that the movie industry needs all the income it can get just to break even for some movies, plus to help keep enough money around to survive if they have several flops.

From an ISP standpoint, movies take more bandwidth to download as well, so it makes sense to try limiting online movie piracy. For music though, for one song it takes what, 3-6MB? That is so little and is done so quickly, it doesn't HURT ISPs nearly as much.

Really, the recording industry just can't really justify the costs of going after individuals in the home, and it is only the commercial pirates who need to be stopped. With all the fraud on the part of the record labels, claiming ownership of music they have no rights to and such, it is really difficult to feel any sympathy there.

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