Austrian Rights Holder Group Wants To Hit Cloud Services With A 'You Must Be A Pirate' Tax

from the cloudy-with-a-chance-of-rent-seeking dept

Thu, Dec 13th 2012 8:23am — Tim Cushing

Another "YOU ARE ALL PIRATES" levy is being proposed by Austrian rights holders group Autoren. In addition to the fees already paid by consumers on blank CDs and DVDs, IG Autoren is pushing even further. And it's not just interested in physical media.

Consumers in Austria already pay levies on blank CDs and DVDs. Rights holders have been advocating to expand these kinds of fees to hard drives and other forms of storage media as well, and apparently aren’t just thinking about local storage. In its newspaper, IG Autoren wrote:

“We not only want a hard disc levy, we also want a levy for the usage of the cloud.”

Hardware makers have pushed back, calling these proposed levies what they really are: double dipping. Consumers already pay the levy on blank media and now, Autoren wants to tax the computer, the hard drive and the cloud it connects to. With the dropoff in sales of blank media, IG Autoren's got to make up the income somewhere, right? This is what passes for "fairness" in the eyes of rights holders. If one form of media dies out, along with its associated fees, it must be replaced with another. Rather than face the fact that a business model that predicates itself on the assumption that piracy is the main reason people purchase CDs, DVDs, hard drives and cloud storage is a thoroughly flawed model, IG Autoren would rather push for additional levies -- all in the name of the artists, of course.

One would think that if levying taxes on storage was such a money maker, artists would be better off selling blank CDs at their merch tables if they could collect the levy directly, rather than through a third party. In fact, for those further down on the sales chart, it just might be, considering the "trickle down" effect continues to rain dollars on the most successful artists while leaving the other 95% with mere pennies.

Not that IG Autoren is interested in approaching this logically. To defend its rent-seeking, it points to Germany, the country with some of the most screwed up concessions to rights holders' demands.

Rights holders on the other hand point to Germany, where levies are already in effect. German consumers currently pay €13.65 ($17.66) for every PC and between €7 and €9 for external hard drives. However, there is no fee for cloud storage services in Germany.

The European Commission is currently considering reforms to copyright law to better apply it to the digital age. IG Autoren apparently believes means this means it should be able to apply its levies, ones that began back in the analog age of cassettes, to cloud services and any other technology that could conceivably hold an mp3. And it's not just IG Autoren. As reported back in October, a coalition of rights holders sent a submission stating that they were "entitled" to remuneration for personal copies. Fortunately, the commission's paper pointed out that cloud services actually reduced the number of copies made, making a private copy levy "less appropriate."

If the past is any indication, these rights holders will likely be granted a levy on hard drives and other storage devices, but cloud services may be a tougher battle. Considering many services offer limited free accounts and are likely unwilling to foot the bill for a €7-9 levy, this means these services won't be available (at least not the free option) in countries collecting this fee. The end result of this rent-seeking is fewer options for the public simply because a handful of rights holding organizations feel they're "owed" a cut from anything that can conceivably hold copied files.

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Filed Under: austria, cloud computing, copying, copyright, levies, taxes

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fogbugzd (profile), 13 Dec 2012 @ 7:35am

One reason it is often easy for rights groups to get this kind of legislation passed is that the people who are hurt are so not have any type of lobbying organization to fight the measure. In this case the collection society is stepping on the tires of companies like Google and Amazon. I am sure they would not like to see this type of thing started in Australia and have them be a model for the rest of the world.
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jameshogg (profile), 13 Dec 2012 @ 8:29am

I don't even trust that my data on DropBox is always going to be there anymore, so I make backups. Who knows what government will swoop on it and shut it down, cutting me off from my legitimate files.

But apparently, just like this tax proposal, I am a facilitator of piracy and not any kind of true victim whatsoever.
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Killer_Tofu (profile), 13 Dec 2012 @ 8:32am

If I am levied ...
I would consider it a free license to download as much as I want from anywhere I want. After all, if I have to pay for it, then I sure as heck am going to get it.
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Anonymous Coward, 13 Dec 2012 @ 8:33am

So does this mean...
Austrians will be able to download the shit out of everything, since they're paying for it? Or will they still be labeled Pirates?
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Anonymous Coward, 13 Dec 2012 @ 8:38am

From the Copyright Industry.
We have attitude that we own all of culture, and therefore we should be able to gather in as much money as possible. Note these are not fees to allow sharing of culture, but compensation to the top artists for the copying we do not detect. We still reserve the right to claim every all your money if we detect you indulging in piracy.
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ASTROBOI, 13 Dec 2012 @ 8:38am

What happens if somebody in Austrailia buys blank dvds from the US where there is no tax? Is this forbidden? Or just pointless because of shipping cost?
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Anonymous Coward, 13 Dec 2012 @ 8:41am

Or will they still be labeled Pirates?

You need to ask this question?

Please don't take this as a snide remark. Customer = pirate to these parasites. If you downloaded something and put it on any form of media capable of storing it, you must have pirated it. These parasites don't see anything other than pirates.
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Zakida Paul (profile), 13 Dec 2012 @ 8:47am

Question
With all these levies, will it be ok to download whatever you want from where ever you want since, you know, rights holders are getting paid?
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Anonymous Coward, 13 Dec 2012 @ 8:56am

oopyright holders trying to justify theft of cloud user's money by pretending to be victims of theft themselves.

I would say I'm shocked but this is par for the course for maximists so I'll just go with disgusted
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Anonymous Coward, 13 Dec 2012 @ 9:03am

Let's just ignore the fact that 'the cloud' has to be stored somewhere and that if hard drives have the levy that hardware has already had the levy assessed for it. This just seems like a scheme to get multiple levies for the same shit over and over and over. Also to drive up operations costs for any remote storage which they like because if they drive those costs up enough fixed media will look more attractive by comparison.
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John Fenderson (profile), 13 Dec 2012 @ 9:07am

Re:
What happens if somebody in Austrailia buys blank dvds from the US where there is no tax?

The US does have such a copyright tax. It's 3% of the price of the initial sale of the media.
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Anonymous Coward, 13 Dec 2012 @ 9:08am

Re:
What does Australia have to do with anything?
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Anonymous Coward, 13 Dec 2012 @ 9:10am

Re: Question
rights holders are getting paid
Where on earth did you get this ridiculous idea?
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Anonymous Coward, 13 Dec 2012 @ 9:10am

Re: From the Copyright Industry.
Well, no. See, the tax is really just for what you might do, but if you don't do what you might do and instead do something else, you have to pay for it and get taxed again. Fair is fair.
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Anonymous Coward, 13 Dec 2012 @ 9:14am

Re: Re: Question
Must have been asleep the past few years
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The Real Michael, 13 Dec 2012 @ 9:17am

Re: So does this mean...
The content industries can't have it both ways. They can't be handed a handsome paycheck on a levy to act as compensation for internet users accessing copyrighted works, then turn around and sue those same users for copyright infringement.
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Anonymous Coward, 13 Dec 2012 @ 9:19am

Re: Re: So does this mean...
Can't have it both ways? You underestimate the corruption inherent in corperations being in bed with goverment.
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Beech, 13 Dec 2012 @ 9:19am

The Levy doesn't seem to new there to compensate for piracy, their stated intent is to be compensated for your own personal copies that you could legally make.
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Zakida Paul (profile), 13 Dec 2012 @ 9:20am

Re: Re: Question
Taking the rights holders group at their word because we all know that they are fine and honest in everything they do and the rest of us are just criminals.
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Zakida Paul (profile), 13 Dec 2012 @ 9:20am

Re:
Funny, that's what I thought buying the content was for. How stupid am I?
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The Real Michael, 13 Dec 2012 @ 9:26am

Re:
"Let's just ignore the fact that 'the cloud' has to be stored somewhere and that if hard drives have the levy that hardware has already had the levy assessed for it. This just seems like a scheme to get multiple levies for the same shit over and over and over."

Double-dipping -- even triple-dipping -- is nothing new to the content industries. Consolidating wealth from the bottom to the top is habitual behavior for the content industries. I wouldn't be surprised if over half of our deficit was wrought by corporate subsidies.
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Anonymous Coward, 13 Dec 2012 @ 9:26am

Re:
Absolutely nothing...since we're talking about Austria
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Anonymous Coward, 13 Dec 2012 @ 9:28am

Ok people...
Austria = Country in Europe were Arnie was born. Relevant to the story.

Australia = Island continent where they value beer, cricket, rugby and/or Aussie Rules Football. Not relevant to the story.
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Anonymous Coward, 13 Dec 2012 @ 9:33am

Re: Ok people...
You mean hitler wasn't born down unda?!
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Anonymous Coward, 13 Dec 2012 @ 9:39am

Re: Re: Ok people...
Might have been better if he was. Blitzkrieging New Zealand isn't exactly easy (since... the whole water in the way thing. Plus the sheep would fight back).
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Mr. Applegate, 13 Dec 2012 @ 9:50am

So let me get this straight...
If I pay the levy when I buy my PC then I am free to download all the copyrighted stuff I want for free (pirate). After all, I have already paid the pirate tax!

Now you know exactly how well this plan will limit piracy, it will enable it and make people feel justified in doing it.
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ASTROBOI, 13 Dec 2012 @ 9:55am

Re: Re:
Sorry, my bad; Austria!!! But still, any tax or levy in the US is considerably less than elswhere and according to the most knowlegeable source on Earth (Wikipedia) we have the following:

"17 U.S.C. � 1008 bars copyright infringement action and 17 U.S.C. � 1003 provides for a royalty of 2% of the initial transfer price for devices and 3% for media.[12] The royalty rate in 17 U.S.C. � 1004 was established by the Fairness in Music Licensing Act of 1998. This only applies to CDs which are labeled and sold for music use; they do not apply to blank computer CDs, even though they can be (and often are) used to record or "burn" music from the computer to CD. The royalty also applies to stand-alone CD recorders, but not to CD burners used with computers. Most recently, portable satellite radio recording devices contribute to this royalty fund.[13]

Thanks to a precedent established in a 1998 lawsuit involving the Rio PMP300 player, most MP3 players are deemed "computer peripherals" and are not subject to a royalty of this type in the U.S."

So buying from the US and importing would still be a workaround providing it isn't forbidden or too expensive due to shipping or maybe custom duties.
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out_of_the_blue, 13 Dec 2012 @ 10:04am

Yes, the innocent always pay for criminals.
It's difficult to get pirates, who pride themselves on how much they rip off, who put great efforts into avoiding paying -- to the extent of writing peer-to-peer apps, VPNs, The Onion Router, who are every day right HERE defending their theft and dodging practices -- it's DARN difficult to make them pay, Captain Obvious.

So what's your point here?
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Anonymous Coward, 13 Dec 2012 @ 10:11am

Re: Yes, the innocent always pay for criminals.
Except pirates have been shown to be heavy buyers. Why do you keep repeating such a blatent lie?
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Cory of PC (profile), 13 Dec 2012 @ 10:14am

Re: Yes, the innocent always pay for criminals.
Blue... you're an idiot.

Think for the moment that in order for these things to get online, how did they? Someone went out of their way to buy these things, made a digital copy, and then set it free onto the Internet for others to make copies of. These are the "pirates" you're speaking of, and they do have the money! Not to mention for the likes of us who are at least a bit more logical than you are that download do return the favor by paying.

So, I'll just keep on repeating: why should we take you seriously? You're an idiot.
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Anonymous Coward, 13 Dec 2012 @ 10:20am

Lets just admit it, the government thinks we're all evil criminals, so lets rename our taxes to reflect that.

Taxes for military and defense related stuff for example can be renamed "You must be a terrorist" tax, why else do they need to spy on us? They didn't get serious about thinking that way (In the US anyway) until after 9/11.
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Anonymous Coward, 13 Dec 2012 @ 10:23am

Re: If I am levied ...
Then you would get sued far into hell. The levies are levees to keep money in the "entertainment-industry".
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Checkmate, 13 Dec 2012 @ 10:25am

What? I thought the cloud service stored my data on a hard drive which was already taxed and accounted for. Did they really store my data on those cloud up the sky?
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Zakida Paul (profile), 13 Dec 2012 @ 10:26am

Re: Yes, the innocent always pay for criminals.
What's your point, moron?

The only people who will be 'punished' by these levies are the legitimate users and providers. The 'pirates' will just avoid the levies by avoiding cloud services.

Do you see, now, why these levies are a bad idea or do you need a big purple dinosaur to explain it in a way 2 year olds can understand it?
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Anonymous Coward, 13 Dec 2012 @ 10:30am

Re: Re: So does this mean...
Well, the levies are officially branded as compensation for the copyright exemptions in place, like making it legal to share with your family and take a single copy for backup. I wonder how much we pay for those rights. I would guess it is about the same as a few legal CDs each month. For some of us, that is more than we spend on music. That almost none of it goes to the artists is just good business...
Levies are not branded directly as compensating for piracy, which is the reason they are there and growing like a tumour.
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Anonymous Coward, 13 Dec 2012 @ 10:42am

Re: Re: Re:
Think custom and think KirtSaeng case. Both would burn you hard for respectively not paying the taxes and levies on an imported good and for importing without the consent of the original producer. The first one is a fact. The second one is a claim in a court.

Both would make it illegal to import it without paying the taxes and levies. Now, if we are talking personal use and therefore no reselling it would be legal, but it is hard to justify a trip to the states and back unless you have more things on the shopping list than just a few CD burners, 200 blank CDs etc.
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Anonymous Coward, 13 Dec 2012 @ 10:44am

Re:
Next thing you know they will want a levy on electricity, to compensate them for all the times their content is played.
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Anonymous Coward, 13 Dec 2012 @ 10:53am

Re: So let me get this straight...
You are correct if only the levies were labeled as that. They are not. Only ones to label them as piracy-taxes are Mike Masnick and crew. In Europe they are justified by the european copyright exemptions making it legal to make a backup and making it legal to share with the close family. In reality they are completely wasted in administration.
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Anonymous Coward, 13 Dec 2012 @ 11:03am

I remember when I stayed in London I had to take the train everyday at lunch time, the master of the station was never there and I asked a lovely lady that was passing by what I should do she told me to just go thru, well I felt bad anyways and when I arrived at my destination I got to ask a security guard how would I pay for a ticket I didn't had, he pointed me and I got on a long line just to pay that train ticket, funny though that same week at my station of origin I was stopped and asked for a return ticket, maybe I am just paranoid, well I like to do the right thing always.
The one thing I will never do however is give money to ASCAP, MPAA, RIAA, BPI or BSA supporters, I rather go to jail. So I pirate when I need something from those people and I don't feel bad, specially when I see the jerks trying to get free money, without having to work for it as if they are entitled to it, never mind my abhorrence to granted monopolies.
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Shadow Dragon (profile), 13 Dec 2012 @ 11:14am

Re: Yes, the innocent always pay for criminals.
So what's your point? I'm guessing you're a copyright abolitionist because you make the side you supposedly support look bad and undermine their argument from within.
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Magnus, 13 Dec 2012 @ 11:21am

A small correction
Please note that the tax is not on hard drives, but on EXTERNAL hard drives. This is how it works in Sweden and Germany.

It's obvious really: Anyone who buys a NAS (file server) with a pre-installed hard drive is a filthy thief. Someone like me, on the other hand, who buys the box and drive separately, and installs himself, is an upstanding citizen, who would not dream of ripping his entire DVD collection so he can watch it on his tablet.
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Anonymous Coward, 13 Dec 2012 @ 11:33am

Re: Yes, the innocent always pay for criminals.
So you theory is that not only did pirates create The Onion Router (and the other technologies you sited), but they are also the only ones who use it?

So by you theory, the CIA, and other law enforcement agencies (just to make one sector) are pirates.

Guess its true that your type believe everyone is a pirate.
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Anonymous Coward, 13 Dec 2012 @ 11:38am

Re: Re: Yes, the innocent always pay for criminals.
Make = name....hate auto-correct almost as much as Mafiaa shills.
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Anonymous Coward, 13 Dec 2012 @ 1:08pm

Re:
'the people who are hurt are so not have any type of lobbying organization to fight the measure'

Silly me. I thought that's what we had the Congress for.
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Zakida Paul (profile), 13 Dec 2012 @ 2:20pm

Re: A small correction
"It's obvious really: Anyone who buys a NAS (file server) with a pre-installed hard drive is a filthy thief."

So, just about every business on the planet with backup plans for their data?
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Anonymous Coward, 13 Dec 2012 @ 2:28pm

This is simply ridiculous, and makes me want to vomit. This is an excellent example of the corruption caused by lobbyist.
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Anonymous, 13 Dec 2012 @ 2:35pm

PIRATE AND PROUD!
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Anonymous Coward, 13 Dec 2012 @ 3:18pm

Don't forget
Don't forget RAM! And ethernet cables, routers, USB hubs and ports... the MP3s all go through them.

Legal or not, anyone paying a fee to store the media is going to be a lot less inclined to pay for it in the first place.
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John Fenderson (profile), 13 Dec 2012 @ 4:35pm

Re: Re: So let me get this straight...
They're talking from the US perspective, where it's legal to make such copies irrespective of the levy. But we have a levy anyway that was passed specifically to offset losses due to piracy.
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Anonymous Coward, 17 Dec 2012 @ 5:08pm

Next: pay tax to use the Internet because it stores "pirate content".
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