Content and Control: Assessing the Impact of Policy Choices on Potential Online Business Models in the Music and Film Industries

Abstract:     
The online environment and new digital technologies threaten the viability of the music and film industries' traditional business models. The industries have responded by seeking government intervention, among other means, to protect their traditional models as well as by developing new models specifically adapted to the online market. Industry activity and public debate have focused on three key policy areas related to copyright holders' control of content: technical interference with and potential liability of P2P services; copyright infringers' civil and criminal liability; and legal reinforcement of digital rights management technologies (DRM).

This paper seeks to support policymakers' decision making by delineating the potential consequences of policy actions in these areas. To do so, it assesses how such action would impact relevant social values and four business models representative of current and emerging attempts to generate viable revenues from digital media. The authors caution that government intervention is currently premature because it is unlikely to strike an appropriate balance between achieving industry goals while supporting other social values, such as consumer rights, the diversity of available content, and technological innovation.

Keywords: Copyright, digital media, peer to peer (P2P), DRM

JEL Classifications: K29, K33, K42, L82

Working Paper Series