Here’s a jarring statistic: in the past three years music industry lawyers have sued more than 23,000 music fans for filling their hard drives with free songs and sharing them with the world. But as almost any music executive will tell you, suing your customers is an unsustainable strategy. The negative PR and lingering ill will the suits instil in music fans is just too high a price to pay. Thus, while the lawsuits continue today, litigation against individual uploaders (and downloaders) is destined to become as anachronistic as the 8-track tape.

As Hilary Rosen, a former chief executive of the Recording Industry Association of America, recently acknowledged, it’s time to stop suing fans. "For the record, I do share a concern that the lawsuits have outlived most of their usefulness and that the record companies need to work harder to implement a strategy that legitimises more p2p [file-sharing] sites," she wrote on Huffington Post last month.

If Rosen, the architect behind the industry’s aggressive legal campaign against file-sharing networks, is blogging about the short-sightedness of suing fans, what then can we expect from music industry attorneys in the near future?

The answer was revealed in troubling fashion last week in separate pronouncements from the British Phonographic Industry and a trade group representing independent recording executives, songwriters, musicians and their managers. According to these groups, there will be a new scapegoat in the war against piracy: the internet service providers.

The BPI started the witch hunt by accusing Tiscali and Bulldog, to name just two British ISPs, of turning a blind eye to customers who use their broadband connection to access peer-to-peer networks. The BPI insisted that the ISPs should cut off the offenders. Tiscali responded testily, stating that the BPI failed to provide sufficient evidence, and saying that next time it should get a court order.

Making an enemy out of the ISPs is a doomed legal approach. They, according to Europe’s e-commerce directive, are considered "mere conduits," a crucial legal defence. Just as BT is not complicit in a bank heist plotted over the phone by its customers, ISPs cannot be held accountable for its file-sharing customers. "The law is pretty clear. If a person is using a network to infringe copyright, you have to go after the infringer," says Struan Robertson, a solicitor for Pinsent Masons who specialises in technology law.

What the BPI was hoping for was the creation of a new, unprecedented level of cooperation between the ISPs and the music labels – one that would see the ISPs police their own networks and cut loose the bad seeds without requiring the music companies to get a court order first. But, what the BPI received instead was a blunt lesson in customer relations. Namely, the ISPs will always prioritise their customers – a point that is apparently still lost on much of the music industry.

If the BPI’s naming and shaming tactic is misguided, then the announcement by a coalition of independent labels, composers and musicians that they want to recoup lost revenues by imposing a tax on ISPs "that profit extensively" from file-sharing is simply foolhardy. Interestingly, the BPI is staying well clear of this initiative.

Let’s assume for a moment a world where ISPs are required to pay a levy – something the music industry group calls a "value recognition right" – for providing customers access to P2P networks. According to some legal experts, such a payment scheme would actually weaken the industry’s anti-piracy stance. That is because consumers would likely be able to copy all they want from file-sharing networks – as long as that individual did not then sell his downloads to a friend – because, the rights holder would be compensated – in this case, by the ISP.

The European Copyright Directive states that an individual is free to copy media onto a blank disk (in this case, a hard drive) as long as he or she pays a levy. (It would be doubly problematic in the UK and Ireland, where an individual cannot make a private copy, but, consequently, there’s no levy on blank media in those countries.) By creating a blanket levy to cover file-sharing, consumers could happily fill their hard drives, with impunity.

The Association of Independent Media, one of the leading proponents of the plan, counters that the levy it is devising would be levelled against the ISP, not the customer, and thus the copyright directive protections would not be extended to the consumer’s file-sharing habits. Here’s another lesson in customer relations, music industry: a tax like this would absolutely be passed on to the consumer.

"It’s such a stupid distinction," Robertson says. "Of course the fee would be reflected in the price the intermediary charges the individuals."

The shift in strategy from targeting consumers to targeting broadband providers is little more than sleight of hand by the music industry. From a PR standpoint, waving a big stick at the likes of BT, Sky or Tiscali may seem more desirable than suing a 13-year-old kid, but in the long run, it will be much more costly – for all.

Bernhard Warner is a former Reuters internet correspondent in Europe and senior editor for The Industry Standard Europe. He writes about technology, the internet and media industries and can be reached at techscribe@gmail.com

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