French Government May Subsidize Music Downloads, Says EU

The European Commission has approved a French program to subsidize legal music downloads for young people.

The Carte Musique scheme gives €25 (US$35) to French residents aged 12 to 25 to spend on music downloads or subscription services. Young people can purchase a €50 card for just €25, with the balance paid by the state. There was concern that this might contravene the E.U.'s competition rules, but the Commission has ruled that this is not the case and the initiative will not distort the market.

The French government expects to launch the program in "the next few weeks," according to a statement from Minister of Culture Frédéric Mitterand. It will be later than President Nicolas Sarkozy envisioned in a speech in January. Then, he called for vouchers worth €200 to be handed out by the middle of the year.

European Competition Commissioner Joaquin Almunia praised the scheme and its aims.

"We welcome initiatives from member states to increase the availability of music online at a lower price for consumers and through legal distribution channels. Music online is certainly a driver for the success of the Internet and for economic development," said Almunia.

The Carte Musique is aimed at combating illegal downloads by getting young people into the habit of paying for music online through legal channels. Cards are limited to one per person, per year and the French government expects one million cards will be sold each year.

The scheme requires website operators to contribute a reduction in the price of the music, an extension of the duration of the subscription or a contribution to the cost of advertising the card. However as it caps the benefit each operator may draw from the scheme at €5 million there are concerns that the largest operators such as iTunes, FNAC and Amazon may not participate.