A think-tank has called for outdated copyright laws to be rewritten to take account of new ways people listen to music, watch films and read books.
It is not the music industry's job to decide consumer rights, says IPPR
The Institute for Public Policy Research (IPPR) is calling for a "private right to copy".
It would decriminalise millions of Britons who break the law each year by copying their CDs onto music players.
Making copies of CDs and DVDs for personal use would have little impact on copyright holders, the IPPR argues.
Copyright issues have, in the past, been steered too much by the music industry, the report said.
IPPR deputy director Dr Ian Kearns said: "When it comes to protecting the interests of copyright holders, the emphasis the music industry has put on tackling illegal distribution and not prosecuting for personal copying, is right.
"But it is not the music industry's job to decide what rights consumers have that is the job of government."
According to research from the National Consumer Council, more than half of British consumers are infringing copyright law by copying CDs onto their computers, iPods or other MP3 players.
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Report author Kay Withers said: "The idea of all-rights reserved doesn't make sense for the digital era and it doesn't make sense to have a law that everyone breaks. To give the IP regime legitimacy it must command public respect."
Intellectual property laws are currently being reviewed by the government.
Chancellor Gordon Brown has asked chairman Sir Andrew Gowers to report his findings back ahead of the pre-budget report in November.
The IPPR is hoping to influence this with its report, entitled Public Innovation: Intellectual property in a digital age.
Its key recommendation is that any policy regarding Intellectual Property policy should recognise that knowledge is a public resource first and a private asset second.
The so-called knowledge economy is growing fast as the traditional manufacturing of goods is replaced by more intangible assets.
With it is a growing paradox in which intellectual property is both a commercial and cultural resource.
"The internet offers unprecedented opportunities to share ideas and content," the report says.
"Knowledge must, therefore, perform the roles of both commodity and social glue, both private property and public domain," it adds.
The report looks at how Digital Rights Management (DRM) technologies - which restrict the sharing of music or other intellectual property - are affecting attempts to preserve electronic content.
It argues that the British Library should be given a DRM-free copy of any new digital work and that libraries should be able to take more than one copy of digital work.
Ms Withers said: "We charge the British Library as being the collective memory of the nation and increasingly it has to archive digital content.
"More and more academic journals are delivered digitally but copyright laws aren't designed to deal with digital content."
She said there was often a conflict between DRM and accessibility technologies which needs to be addressed.
"Someone with poor sight may use a screen reader technology and may have to change the format of the content to use it but some DRM technology isn't sophisticated enought to take this kind of thing into account," she said.
The report also calls for the government to reject calls from the UK music industry to extend the copyright term for sound recording beyond the current 50 years.