How Britain's Pirate Finder General is trying to save the Analog Economy at the Digital Economy's expense

My latest Guardian column looks at Peter Mandelson's new "Digital Economy Bill," a sweeping piece of proposed British legislation that would give Mandelson broad powers to act as the Pirate-Finder General, with the implausible aim of reducing UK file-sharing by 70 percent in one year.

Mandelson argues that Britain's Digital Economy will be based on the contrafactual premise of a steady decrease in computer speed, drive capacity, technical competence, network versatility and network ubiquity. Of course, the real digital economy is in those British companies that figure out how to thrive whether or not copying occurs - companies that use networks to reduce their costs, reach larger customer bases, and provide services whose demand and profitability grow with network use, companies such as Last.fm or Moo.com.

These companies' businesses are inconceivable without the net, but they also risk being collateral damage in Mandelson's war on the British internet. Just increasing the liability for copyright infringement (and creating a duty to police user-submitted files for infringement) could bankrupt either company overnight. How would Moo sell business cards with your personal photos on them if they could be sued into oblivion should those photos turn out to infringe copyright?

Mandelson is standing up for the Analogue Economy, the economy premised on the no-longer-technically-true idea that copying is hard. Companies based on the outdated notion of inherent difficulty of copying must change or they will die. Because copying isn't hard. Copying isn't going to get harder. This moment, right now, 2009, this is as hard as copying will be for the rest of recorded history. Next year, copying will be easier. And the year after that. And the year after that.

Why does Mandelson favour the Analogue Economy over the Digital?