Good post, Derek. A couple of possibilities:

* Apportionment could be driven by volunteer Nielsen families, an API that the clients talk to, random spidering, all according to some formula. What’s more, this undoubtably thorny technical problem is a place that’s ripe for innovation and commerce: if all those over-capitalized DRM vendors turned their attention to this instead of tilting at the copy-restriction windmill, I’m sure we’d get a whole suite of good answers to the problem (and conversely, part of the reason that there is no good answer to this problem today is that there’s no reason for a technologist or entrepreneur to attempt to tackle it, absent a compulsory license)

* Not every ISP would have to subscribe. ISPs could differentiate themselves from their competition by offering the ability to lawfully download — what’s more, lawful downloading systems could use measures that are vulnerable to legal attacks, like super-peers and optimistic cacheing, which will substantially offset the costs of offering the service, since it minimizes the amount of non-local traffic. What’s more, the ISPs that opt into this will have their legal burdens — responding to takedown/spy/disclosure notices — substantially reduced, because it will be legal for their customers to share files. One consideration in calculating the sum of the levy could be to make it as close to the savings in bandwidth and legal hassles as possible, so that it comes out as a wash.

* The worry about freeriders is just knee-jerk stuff. I have an Earthlink DSL subscription, but I manage my own email through a hosted service somewhere else, and so I don’t need the POP or SMTP service Earthlink offers. Nevertheless, I pay for it, because switching it off on a case-by-case basis and rebating my pro-rated share of the service cost would add infrastructure and accounting costs to the services offered by Earthlink that would exceed the savings. IOW: it’s cheaper to support the freeriders with @earthlink.net email addresses than it is to *not* do so. If I wanted to, I could find another ISP that doesn’t offer email or web-storage, but those ISPs aren’t any cheaper than Earthlink as it turns out.

Great job analyzing the post and bringing more information to the discussion. I think the most important thing is that you both recognize that the most important thing is to continue to explore these issues to figure out what should be done.