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Its not good because a site there can be shut down simply based on copyright infringement.
The Internet is in no way ready to be interfered with by the government. It's still developing and by putting pressure on it now, the progress it's making now with the vast social networks and increases in software will be limited.
There aren't very many countries that have a distinct "internet identity". Maybe two. The premise of such laws is intended to protect copyright and copyright use and has little to do with governing over the cultural habitat and development of some independent British "internet", as though the internet was intended to become some sort of outlet for nationalist practices.
In practice, these laws are generally used to protect the market share of established industries and deny the ability of competition to enter the marketplace, such as it has developed, of online and digital media and distribution. We're only now seeing the music industry start to shift after over a decade of mp3s and the experiments of how to distribute them. It should have shifted almost immediately toward an apple-type system if big record labels wanted to compete and preserve some market share in this brave new world. Instead they stalled just like radio executives did in the 30s and 40s with the coming of TV. Newspapers and news magazines did the same thing; balked at the importance of the internet share of media consumption to their future in the mid 90s. Look where many of them are now. All the government interventions do to "resolve" this problem is slow it down and further aggravate consumers and new competing business models.
Yea but every site has some form of copyright infringement on it. If Napster didn't come out, iTunes wouldn't of been established. The problem is that the music executives are old-timers and old-school. They aren't keeping-up and still think magazines are very effective. They don't push online marketing.
Survival of the fittest. If they can't keep-up with technology and fight back, then they shouldn't be around.
Itunes is a completely different business model and operation than peer-to-peer networks, focused on what was ultimately the driving method of distributing music in a digital way. Sell songs individually that people want at a market price and drive them toward other songs that they may also prefer, sometimes in unique or unexplored markets. The effect of this was that music consumption (in real dollars) has risen considerably, even as the market share of former record label dominance has diminished.
The threat of piracy, in the form of Napster, did nothing to force those record labels to adapt and form a new business model. In fact they have spent most of their time and energy trying to protect their market share through "copyright infringement" rather than using digital distribution as a tool for marketing and advertising, as itunes amounts to doing. Look when Napster came out and then look when itunes did. They have also resisted apple's dominance of the digital distribution methods at every twist and turn, for example by trying to insist on their own prices rather than market established prices that people were willing to pay, to no avail.
It is true if they can't keep up with technology and fight back they shouldn't be around. But they do indeed "fight back". Digital copyright laws are usually one of their weapons. Simply because there's a new and superior market to the old manner doesn't mean that the old manner will evaporate automatically. In the absence of overt government interference it might. In the real world, it usually sticks around for too long because of the government sticking itself into the scene and trying to extend old, traditional business practices onto the new mediums.
However, that's England. I don't get why England is even putting a bill out there like this when they haven't really developed an Internet identity of their own yet.
I am not a British subject so I will leave any opinions up to them. However, I would be suspect of any law that would restrict the use of the Internet by any government. People should control their government . . . NOT the other way around.
Just my not-so-humble opinion. B)