Feargal Sharkey on three strikes… and after

A new deal for music fans?

Feargal on … building a digital music business

I try to reasonably optimistic about these things.

Are people going to stop being creative? Probably not. And if you try and stop them, for sheer belligerence as much as anything else they'll probably be more inclined to do it. And I quite buy into the idea of technology democratising creativity - that's fantastic.

Are people at the other end of the chain going to stop liking music, and wanting to consume music, and listen to it, experience it? Absolutely not - and there is a bigger demand for music has never been higher.

The bit we're trying to work out right now is the bit in the middle that joins the two together. So, if the statements made for Apple for example are true, you could not go out and run iTunes as a separate standalone business, because you're going to lose money.

It's simple - good businesses make money and bad businesses don't make money, in which case they're out of business very quickly. And that's the point I'm getting at. I'm not sure some of the gains technology has to offer a record company aren't offset by costs somewhere down the line. The reality is someone's struggling to create a business based on a 79p download. We're going to have to start exploring other ideas.

Feargal on... three strikes

Even within the past seven days there's been any number of conversations going on - and they're very sticky - with ISPs revolving around the ideal of how do we do this together. We need something which gives you some sort of commercial incentive as an ISP, but which also ensures we as the music industry have a financial model that can still keep signing artists and making records.

It's not a big mindshift right now. I have genuinely seen a huge mental shift in the past six months - that conversation wouldn't have taken place a year ago.

It is incredibly reassuring that if the government will stand up and say, if you can't come up with a commercial solution to something that's a commercial problem, then we will legislate. Personally I have concerns about that, based on my five years as the radio regulator of commercial radio. I'm acutely sensitive to the idea that kind of regulatory intervention does not necessarily provide you with a 100 per cent solution.

El Reg: What concerns?

Nobody in the music industry has any idea what it means when the Government says they're going to regulate.

El Reg: Is it the threat of legislation that's changed that - that's opened up negotiations with ISPs?

It's not the threat of legislation, it's the commercial environment. The set of problems ISPs are facing is totally different. You can only sell so many broadband connections to people in the United Kingdom, then you can't sell anymore. You can only sell so many mobile phones, then everyone's got one.

So they're looking at their business and thinking, "how can we grow this?" That drives you down the route of content and what extra services can you get out of them? What can you offer them that gets an extra fiver out of them?

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