One plan is to charge a tax in exchange for rights to music online.

By ERIC PFANNER


PARIS - Two generations ago, the Isle of Man gave the world the Bee Gees. Now it says it wants to help the wounded music industry stay alive.

The island, a rainy outpost in the Irish Sea, is promoting an offbeat remedy for digital piracy, which the music labels blame for billions of dollars in lost sales. Instead of fighting file-sharing, the local government wants to embrace it? and it is trying to enlist a skeptical music industry’s help.

Under a proposal announced last month, the 80,000 people who live on the Isle of Man would be able to download unlimited amounts of music? perhaps even from notorious peer-to-peer pirate sites. To make this possible, broadband subscribers would pay a nominal fee of as little as ￡1, or $1.38, a month to their Internet service providers.

Ron Berry, director of inward investment for the Isle of Man, said the music industry needed radical approaches because of the“utter failure”of its current strategies. Global music sales have fallen nearly 25 percent since 2000.

Despite nearly a decade of campaigning against piracy, the industry’s international trade group estimates, 95 percent of tracks distributed online are pirated, generating no revenue for the recording companies.

“A lot of people in the business are concerned with how much money they are losing, but not with how much money they could make,”Mr.Berry said.

Under his proposal, the money collected by the Internet providers would be sent to a special agency that would distribute the proceeds to the copyright owners, including the record labels and music publishers. They would receive payments based on how often their music was downloaded or streamed over the Internet, as they now do in many countries when it is performed live or on the radio.

The Isle of Man did not invent this idea. The concept of a so-called blanket license to distribute music digitally has been discussed since the days at the turn of the century when Napster, before its rebirth as a legal service, defied the music industry.

There are precedents for such systems in Europe, where many countries have mandatory license fees for television owners to finance public broadcasting.

Several European countries also impose taxes on blank CDs as well as audiovisual and computer equipment; the money typically goes to support cultural industries.

In 2006, a French proposal similar to the one being discussed on the Isle of Man made it to Parliament, but it was rejected after fierce lobbying from copyright owners. The government later supported a new approach: requiring Internet service providers to disconnect persistent pirates.

That plan is still wending its way through the legislature, but it has drawn interest elsewhere, including in Britain. (While the Isle of Man shares a head of state with the United Kingdom? the queen? it has its own parliament and makes its own laws.) There, policy makers are dangling the threat of a system like France’s plan to disconnect pirates, to try to get Internet providers and the music companies to agree on ways to stimulate the development of legitimate digital music sales and to curb piracy.

Rather than adopting one-sizefits-all licensing terms, the recording companies say their preferred approach is to work with individual partners to increase digital revenue, which accounted for about 20 percent of the industry’s sales last year, according to the industry’s global trade group, the International Federation of the Phonographic Industry.

John Kennedy, chief executive of the federation, called plans like that of the Isle of Man effectively a“state-imposed tax that would be unworkable in practice and discriminate against consumers who want Internet access without music services.”

The island, perhaps best known as a tax haven? the government prefers“tax-efficient jurisdiction”? has taken an interest in digital music and other high-technology businesses as it seeks to diversify its economy beyond financial services.

Mr.Berry, the director of inward investment, said he had begun talks with music companies to try to gain support for his plan.

“Our size, demographics and history of innovation means that the island could be an ideal test bed,”he said.