Is now the right time to tinker with HADOPI Mr Hollande?

Political change has come to France and the impact of the switch to a socialist president, following the election of François Hollande earlier this month, could be felt by the music industry. Hollande has begun looking at reforming tough anti-piracy measures despite claims from the music industry that targeting file sharers is beginning to generate increased interest in the legal digital sector.

In the build up to the election, Hollande promised voters that he would take a fresh look at the HADOPI legislation brought in and championed by the former president Nicolas Sarkozy. HADOPI is the antipiracy body, as well as the nickname for the country’s Creation and Internet Law, which is responsible for sending out warning notices to accused file sharers. Although Hollande did not make any promises to repeal HADOPI, the likelihood is he will try and soften the image of the anti piracy setup and bring in alternative deterrents to cutting off an Internet user’s access.

In May, Hollande appointed Pierre Lescure, the former Chairman and CEO of pay TV service Canal Plus, to review HADOPI. Reports in France suggest the appointment was broadly welcomed by rights holder groups, which had supported the tough anti-piracy measures, but are also concerned about alienating music buyers.

Is now the right time to start changing things?
In April, HADOPI published a progress report in which it described the positive effects on illegal file sharing and the current state and outlook of online cultural supply. According to the report a number of studies covering all of the sources available showed “a clear downward trend in illegal P2P downloads.” Moreover, the report stated that the wide range of legal content offers were “gaining visibility and some offers have posted excellent progress.”

The report said that between October 2010 and December 2011, 95% of the 755,015 Internet users that were sent their first warning notice stopped using P2P networks. Of the 5% that did not change their ways after receipt of the first warning notice, 92% did so after receiving a second notice. For the third and final warning notice, 98% stopped file sharing. Based on these figures, just 60 Internet users did not stop file sharing after the receipt of three warning notices.

So far, no one in France has been brought before a judge to explain why they chose not to stop file sharing. If the truth be known, legal action against individuals is probably the last thing HADOPI wants to do. The agency is always keen to promote the fact that it is not all about cutting Internet access. HADOPI operates a website that provides a variety of information on legal digital services and copyright and the importance of intellectual property. HADOPI also runs education campaigns through the website

Impact on legal sales
Those that campaign against tough legal action point the fact that music sales are continuing to fall. That is certainly the case in France. According to the trade association SNEP, total trade revenues in the first three months of this year were down 5%, to €115.7 million, from €121.8 million in the first three months of 2011. Trade revenues from physical sales fell 13%, to €83.1 million, but digital sales rose 23.9%, to €32.6 million. Digital accounted for 28.2% of the total recorded-music trade revenues in the latest three month period, up year-on-year from 21.6%.

The link between tough action and music sales is only one part of the argument and stopping a consumer from file sharing may not make them buy music. But music companies have distribution agreements with a growing number of digital-music services. Regardless of what impact file sharing has on legal sales, it is up to music companies to decide how their content is distributed and who by. No individual has the right to make available a music company’s repertoire and if they think otherwise, then they must accept the consequences, in France at least.

If the evidence presented by HADOPI is anything to go by then the level of file sharing in France is on the decline. Moreover, the number of digital-music services and the range of business models offering new ways to consume music are going in the opposite direction. Cutting an Internet subscriber’s access is the last resort in the fight against online piracy, but watering down measures that appear to be achieving their original intention could throw a spanner in the digital works, just at a time when digital sales in France are really starting to make their mark.

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