Blank media levies: record once, pay thrice

Targeting the humble PC?

Also, the humble business PC has so far not been targeted, but easily could be. The 400m PCs sold each year (increasingly becoming media friendly and portable) might also be levied. The rate favored for this in Germany and France is €30 ($36). So that would add a nice €12bn ($14bn) to the pile if this was a global system, used everywhere and taking in all forms of portable storage.

At the moment the amount of money levied on 32MB memory cards is just a mere €0.34 (40 cents) in France. But devices are expected next year to come out with 1GB cards. Does that mean an €11 ($13) levy?

If so, what will happen as cards like this go into every camera, videocam, portable playing device and mobile phone that uses high density flash memory? That would put another 3bn into the levy pool. And as capacities in memory cards double every year, will the levies follow suit?

So how will this all be resolved? In Canada the levies on blank media have been frozen for the next two years. There is much lobbying between Canada and the US. In the US the content businesses prefer suing their 12-year-old customers, while in Canada they prefer a practical solution that would surely be a disaster if it was anything other than temporary.

There is a direct contradiction in 179 countries signing the World Intellectual Property treaty, and promising to enact legislation similar to the US Digital Millenium Copyright Act, but at the same time charging levies.

And the contradiction is not lost on consumers. It seems to us that even if the industry can bring watertight DRM into play over the next two years or so, that it will take a huge concerted push to eliminate levies, with the effort mostly coming out of the US through the World Trade Organization and through institutions like the World Intellectual Property Organization.

Levies are embedded into century-old institutions, and even after their function is dead and buried, with the onset of strong DRM, they will not go without a fight. But it’s a fight that has to be fought.

© Copyright 2004 Faultline

Faultline is published by Rethink Research, a London-based publishing and consulting firm. This weekly newsletter is an assessment of the impact of events that have happened each week in the world of digital media. Faultline is where media meets technology. Subscription details here.

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