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Archive for January, 2012

Started Out On Burgandy But Soon Hit the Harder Stuff: Google’s Drug Dividend

January 31, 2012 Comments off

Has Google ever declared a dividend?  The answer is not exactly.

The Wall Street Journal had an excellent follow-up story last week (“Sting that Cost Google Millions”) about Google’s drug sting and how responsibility for profiting from selling drugs went all the way to the top of the company’s executive team.  The sting was very well coordinated and revealing of Google employees knowingly advising advertisers of how to avoid getting caught selling ads for illegal drugs.  That obviously did not work out for Google although it worked out well for the people, and Google contributed another $500,000,000 to reducing the national debt (query whether that is more than they paid in income tax through the company’s tax havens.)

MTP readers will remember that Google Chairman Eric Schmidt (who was CEO at the time Google Drugs was in full swing) refused to answer Senator Cornyn’s erudite questions at the recent Senate Antitrust Subcommittee hearing that resulted in a referal to the FTC by Chairman Kohl and Ranking Member Lee calling for a full investigation of Google.

Two things about the Journal’s story caught my attention.  First, the story had an interesting quote from the brilliant professor Eric Goldman.  This is of note to me because of Professor Goldman’s prescient prediction made earlier when the no-indictment agreement first became news that Google’s stock price would take a hit if its senior executive team were to be indicted.

This quote was equally sharp:

“If Google were to adopt a much more restrictive definition of problematic advertisements, everyone would immediately notice a drop in their revenue,” said Eric Goldman, director of the High Tech Law Institute at Santa Clara University. (emphasis mine)

My immediate thought was that the professor once again was right on the money, so to speak, but I would wonder who he meant to include in “everyone” because I feel pretty confident that “everyone” would include stockholders but “everyone” would not include Google executives.

In the accompanying story about that sting, we found out that the drugs being sold were RU-486, human grown hormone and steroids through the site “SportsDrugs.net”.  Although RU-486 must be taken in a doctor’s office, Google executive approved ads saying “no prescription needed”.  Given the seedyness of the sting (which soon moved straight to oxycontin and the harder stuff), Professor Goldman is no doubt exactly correct again.

But the other thing that struck me about the story is that the reporters accepted as a given that Google was sitting on top of $45 billion in cash and paying a $500,000,000 fine was of no consequence to them.

I hope that I don’t ever get to the point that I think $500,000,000 is of no consequence.  But I thought, how in the world could Google be sitting on top of that much of the stockholders money–in cash.  Don’t they pay a dividend?

The Motley Fool gives this advice:

“Think of Google as you would an expert poker player. No doubt it’ll lose some big hands, but by investing heaviest when the odds favor success, it produces better-than-average returns on equity and invested capital.”

You mean like this?

Ah yes.  A poker player like Charles Nesson or Lawrence Lessig perhaps?

But here is the reality from Google’s investor relations site:

Does Google pay a cash dividend?         

No, we have never declared or paid a cash dividend nor do we expect to pay any dividends in the foreseeable future.

Well, aside from the sheer arrogance of that answer for executives who have to lease Moffet Field from NASA in order to have room for their fleet of jets, I would say that they do pay a cash dividend–for the benefit of their executive team when they are about to be indicted for violating controlled substances laws.

I started out on burgandy but soon hit the harder stuff…

From Just Like Tom Thumb’s Blues
Written and composed by Bob Dylan
Copyright © 1965 by Warner Bros. Inc.; renewed 1993 by Special Rider Music

On Highway 61 Revisited

Great News!! Google TV Will Only Transmit Licensed Programming!

January 28, 2012 Comments off

According to the Telegraph:

“Nikesh Arora, chief business officer at Google, said that the launch of internet-enabled TV would have the same effect on broadcasting as the launch of sites such as iTunes had on music.  ‘Disaggregation in TV is coming up,’ he said. Mr Arora said that people would use internet television services such as Google TV to decide when and what to watch. Broadcasters would therefore lose a lot of control on decision making.”

So if it has the same effect as iTunes, then all Google TV programming will be licensed and rightsholders will be paid!  Awesome!!

That must be what he means, right?  Surely he doesn’t mean that Google TV will allow pirate sites to connect to home TV and stream illegal copies while Google sells the advertising?

 

Guest Post: 8 Things Spotify Could Do Right Now to Show They Care About Musicians

January 27, 2012 Comments off

By Gavin Castleton, a songwriter and producer from Portland, OR.  Follow him on Twitter @gavincastleton.  Gavin’s Facebook is http://www.facebook.com/gavincastletonmusic and his excellent Tumblr commentary page is http://gavincastleton.tumblr.com

Copyright 2012 Gavin Castleton.  Used by permission of the author.

  • Promoting “Buy Now” links on album pages and next to individual tracks.
  • Allowing artists to edit their own profiles.
  • Displaying links to artists’ websites, FB pages, twitter profiles, etc.
  • Allowing users to “Like” and “Follow” an artist right from the Artist page.
  • Allowing users to sign up for artists’ email list from the Artist page.
  • Serving ads in a way that did not encourage users to interrupt their listening mid-album/playlist in order to listen to or do something else.
  • Paying independent artists the same rates as major label artists (One could argue that major labels should be paid lower rates than independents, since their overall revenue from Spotify is offset by an 18% share of the company).
  • Paying artists a flat rate for their streams, instead of tying their royalty rate to advertising revenue over which the artist has no control. Artists should not be taking on risk along with Spotify unless they’re also given stock options in the company. The current Spotify model treats artists like investors but without any [equity-type] long-term benefits.

Proudly Non-union Lobby Shop for Google and Wikipedia Targets “Union Thugs” With Dirty Tricks

January 26, 2012 Comments off

The Google-dominated NetCoalition lobbying group is run by this man:

This is Markham Erickson, who, in another life, might have auditioned for Paul Revere & The Raiders.  This time, though, Markham Erickson’s NetCoalition (backed by Google and Wikipedia) is distributing hate pieces on “union thugs”.  And yes, that is the same Markham Erickson who ran another Google front group, the Open Internet Coalition and who wrote many of the emails that got former Google lobbyist and former White House deputy CTO Andrew McLaughlin reprimanded and may have gotten him fired.  You can read these emails from 2010 here, but I’d suggest skipping over the Ben Scott (Free Press) emails where he makes suggestions for President Obama’s State of the Union speech.  Those were just citizen communications, not improper lobbying contacts, don’t you know.  But don’t bother trying to find a connection to Google in Opensecrets, it’s not there.

Here’s a few excerpts from the Erickson/McLaughlin emails:  “Meeting Victoria [Espinel, IPEC] this morning to discuss IP matters” at 9:57 am, then later the same day “Startling disturbing meeting, I wonder if we can chat?”  A couple weeks later, a helpful copy of Erickson’s letter to Victoria Espinel.  You get the idea.  Just staying in touch.  Chatting.  Coffee.

Update–According to the Wilshire to Washington blog, Mark Lindsay…I mean, Markham Erickson…issued a non-denial denial:

“Markham Erickson, the executive director the NetCoalition, issued a statement  on Thursday in which he said that the coalition ‘neither wrote nor approved’ the  blog post. But he said that one of its media consultants, Black Rock Group [the conservative lobby shop],  prepared the handout ‘in connection with an appearance before a conservative  organization [Americans for Tax Reform].’

‘This should never have happened and we are stunned and deeply sorry that it  did,’ Erickson said. ‘Throughout our efforts on piracy legislation, we have kept  our objections focused on policy rather than politics [you mean like threatening Paul Ryan in Reddit and Marsha Blackburn with primary challengers?]. We remain committed to  achieving consensus on legislation to address the issue of online piracy. We  recognize that consensus is achievable only when all the parties are treated  with respect. The events of yesterday have no place in that effort and we again  sincerely apologize for them.'”

The blog post all but leaves the impression that the legislation was a  Democratic-motivated effort to please the donor base in Hollywood, when  anti-piracy legislation traditionally has drawn bipartisan support and, in the  most recent case, has also incited bipartisan opposition. Rep. Lamar Smith  (R-Texas) introduced the Stop Online Piracy Act in the House and Sen. Patrick  Leahy (D-Vt.) was its chief backer in the Senate, while opponents ranged from  Rep. Darrell Issa (R-Calif.) to Rep. Anna Eshoo (D-Calif).”

Well, you know.  Kicks just keep getting harder to find, so to speak.  Markham Erickson didn’t do the hit piece, you see–someone who works for Markham Erickson did the hit piece and put NetCoalition’s name on it.  Wow, now that explains it, right?  You don’t suppose that this is part of Google’s rumored “Republican outreach, ” do ya?  Sureley conservatives know that 99% of Google thinks they are vile and dangerous people.  Even thugs.  But, not according to Markham Erickson–nothing to see here, move along.

Erickson’s puppetmasters must think that conservatives are so dumb that they will be deceived by a few pounds of red meat and believe that when Google is not selling advertising to push oxy to their kids, they will be lobbying to keep Gitmo open.  So if you think that Mark is off base, just make the musical statement that “I’m Not Your Stepping Stone.”

Do you presume to criticize the great and powerful Oz? Cloud Storage vs. Cyberlockers

January 25, 2012 Comments off

There already is an effort to characterize Megavideo as just a little external hard drive lost in the woods and to try to obfuscate the obvious in a particularly Googly attempt to focus the public on the bright and shiny object so you pay no attention to that man behind the curtain.  Here’s a couple thoughts about cloud services.

The most important thing to keep in mind about the Cloud is that it is the latest way that the consumer electronics companies have found to get to replace all our computers yet again.  CDs got nothing on them.  Do you really need the Cloud for data?  I can understand that carrying around all the music and films that someone downloaded from any one of a number of places can be a hassle, particularly if you are a collector and may have only watched the movie once or got it because you just wanted to have it.  I can also understand the lulz from having a pirated copy of the Encyclopedia Britanica for those few times when accuracy is important during arguments with Dad about the cultural importance of skateboarding.  But if you are going to be trusting someone with your personal data, it’s not just any old external hard drive.

It’s a special case of a storage facility that is a lot more important because of the rights that come with it, the protections you expect to have enforced and because it’s supposed to be a safe place free from advertising searches of your personal data.  For example, if you had a “free” cloud storage account that was add supported, and you suddenly started getting ads about cancer treatment centers and you were a cancer survivor, the idea that there was a connection between your medical record and advertising targeted at you might creep you out.  But no more than gmail.

1.  Don’t Get An Account Anywhere You Can’t Afford to Sue:  Most of the time, you want your storage to occur at least within the jurisdiction of courts in your own country.  That really should not be too hard to do.

2.  Read Your Terms of Service:  The less you pay for the account, the less likely it is that you are going to be able to negotiate the services agreement with your cloud provider, so you should actually read their click through agreement because that’s your deal and you are possibly giving the cloud provider your most personal and important data.

3.  What Happens if They Go Out of Business:  Pay particular attention to what happens if the company goes bankrupt.  If you were around for the Dot Bomb Bubble, then you likely experienced the well-funded digerati who ran the company into the wall at 100 mph then flipped the keys to the first bum on the street and disappeared.  We’ve seen very valuable data get wiped because someone didn’t pay their server bills and the co-lo facility wanted to use those servers for someone else.  Remember–unless you have a lot of leverage and were able to negotiate specific terms, you will likely be unable to stop a third party from either wiping your data along with everyone elses or selling the server with your data on it if the cloud company goes bankrupt or just shuts down.  (This is sometimes called “reprovisioning” the servers in geek speak.)  If your cloud company is run by Skippy Dotcom (or even Kim Dotcom), ask yourself if you could trust Mr. Skip to make sure that your medical records are protected.  Because you know what’s cool?  A billion.

4.  Force Majeure and Other Attacks of “GOD”:  The Google risk factors are actually helpful in understanding how little they intend to ever make good on any promise that induced you to sign up:  “Our systems are vulnerable to damage or interruption from earthquakes, terrorist attacks, floods, fires, power loss, telecommunications failures, computer viruses, computer denial of service attacks, or other attempts to harm our systems.”  And the result for you the unpowerful user?  Good luck.  Just about the same answer as if Megavideo got busted.

5.  Insurance:  Chances are that you will not be covered by insurance unless you buy it yourself.  Even then, remember that insurance companies exist to make you bear most of the risk of the insured loss most of the time.   The chances of a vendor (a) having a liability policy that would cover users and (b) that coverage extending to lost profits or harm from a privacy breach are both pretty unlikely.   So assume you are on your own unless you have an insurance certificate in your hot little hand.

6.  Security Breach:  Does your cloud provider have to notify you in case of a breach?  Or do you just wait until your identity is stolen?

So if you follow those suggestions, you will tend to narrow down the more obvious bad things.  And if you ignore them and decide to put your most valuable information on “external hard drives” in Hong Kong controlled by Kim Dotcom–well….

Like the man said, caveat emptor.

The MTP Interview: Indie Film Maker David Newhoff

January 24, 2012 Comments off

Film Maker David Newhoff sat down with MTP’s Chris Castle to talk about his experiences as a film maker and the threats to creators from rogue sites (like Megavideo) and those who support them.  He recently joined the call for Congress to do something about rogue sites in The Hill.  (The interview continues in the next issue of MusicTechPolicy Monthly, sign up for a free subscription in the subscription box.)

MTP:  Tell us a little bit about how you came to make your film Gone Elvis and a few of your experiences as a creator.

gone Elvis began when my wife saw an episode of Oprah that profiled homeless, female veterans.  We had discussed it as a short film, and then I tabled it while I worked on other things.  In the Spring of 2011, I decided I wanted to make a short in time to possibly get it into the FilmColumbia Festival in Chatham, NY, which is near where I live.  I was thinking something light and easy, but my wife reminded me about the homeless vet stories, and gone Elvis was the result.  I wrote the first draft of the script very quickly and sent it to Carla Duren to see if she would be willing to play the lead.  Once she agreed, I launched a Kickstarted campaign with the help of my friend Jeanne Veillette Bowerman, who agreed to act as executive producers on the project.  We raised about $9,000 in a little under 45 days and shot the film over a 4-day period in early July in Upstate New York.  The film did have its debut at FilmColumbia in October and is now available as a free stream via the website while we wait to hear from some other festivals.

[MTP: David's production diary is available here.]

MTP:  What technologies do you use in your craft?

I’m sure I use the same technologies as most folks.  On the capture side, I’ve worked with multiple formats, from film to video to HD digital.  I shot gone Elvis with the Arri Alexa [see discussion http://davidnewhoff.com/2011/09/18/arri-alexa-observations/ ]and am a huge fan of that camera now.  On the post side, I cut now with Final Cut but was among the earliest users of AVID in the New York market.  I don’t do AfterEffects but work with people who do.   Naturally, I use the web for communications, file distribution, and promotion.  I have three Facebook pages, a LinkedIn account, a Twitter account, two WordPress blogs, a company website (sort of), cloud storage, and a YouTube channel.

MTP:  How do you think the legitimate Internet could better serve an independent film maker?

That’s hard to say because I’m old enough to be cynical about predictions related to the Internet; we’ve seen a lot of forecasts come and go.  Still, I think there are several aspects of the Internet right now that help the independent filmmaker, or any artist, in tremendous ways.  The most obvious, of course, is self-promotion.  Part of selling anything is selling yourself, and the web enables literally anyone to do this because the cost of entry is zero.  I also think that some of the ad-supported models on YouTube, etc. create ways for some quality work to find audiences without the corporate filters that can dilute creativity.

When it comes to independent filmmaking, I think there’s a lot of dangerously vague, web-centric ideas out there based on the notion that creators need to forget about customers paying for the products themselves and should focus instead on free viewing as a vehicle to “make money in other ways.”  Many of these opinions, of course, are voiced by people who’ve never made a film and have no idea of the costs involved in even the most modest project.  It’s hard to believe anyone says these things with a straight face, but they’re repeating the mantra of web gurus a lot of which sounds like a broader agenda to abolish copyright in general.  If that’s really the goal of companies like Google, I don’t see how they’re a friend of independent artist over time.  On the other hand, Google could be the monopolistic distribution network we wind up complaining about in ten years.

MTP:  Do you think that the DMCA notice and takedown procedure is working well for independent film makers?  If not, why not?

DMCA seems workable when it’s used to respond to an individual or website that is not engaged in copyright infringement as a business.  When the infringing entity means no harm, then DMCA is a civilized approach to addressing casual or inadvertent infringement.  But DMCA is impractical, insulting, and costly for the entrepreneur who has to send out repeated notices to entities whose whole enterprise is content theft.  There is no other crime in the world that we treat with such kid gloves. I have to send a note out saying, “Please don’t steal from me,” and hope they agree?  If a starving person stole food from a supermarket, he wouldn’t be treated that gently.

[David's interview continues in MTP Monthly.]

See Also:  MTP Inteview: Indie Film Maker Ellen Seider on how US companies profit from piracy on rogue sites

See Also:  MTP Interview: Indie Film Makers Jason Stall and Topper McDaniel on Producing Indie Films in the Age of Google and Rogue Sites Legislation

Why did Wikipedia “go dark” (if you can call it that)? The story according to a “volunteer”

January 22, 2012 Comments off

Here’s a couple questions:  If Wikipedia takes copyright so seriously it actually monitors for copyright infringement and maintains an advanced state of copyright purity, then how is it that copyright infringement is not part of its function?  And exactly how did the “Wikipedia community” express its “stance” on rogue sites legislation?  Wasn’t it really more a question of “Jimbo’s” stance and decision?  Any ideas about who might have influenced that decision?

And isn’t this response really saying that Wikipedia acted in its own interest?  Sorry…the Wikipedia community, all 450 million users a month or so they say.  And exactly how was that interest measured?  Majority vote?

But of course, this “volunteer” doesn’t speak for Wikimedia/pedia, in order to get that you have to send a certified letter via snail mail.

On behalf of the Wikimedia community, please allow me to extend a sincere thank you for taking time out of your day to write to us.

First, let me assure you that Wikipedia respects copyright laws. We are one of the most advanced sites on the web in the matters of copyright purity. Our volunteers monitor almost all additions for possible copyright infringements and spend a great deal of time ensuring that all media files in use comply with both US and international law.

The problem with SOPA and PIPA is not that they allow fighting of copyright violations—we are strongly against copyright violations. The problem is that many of the formulations in the proposed bills are very flawed, and many procedures in the proposed bills can easily be abused and used for censorship. For a detailed explanation about the problems with the proposed legislation, please see a statement by our General Counsel, Geoff Brigham, at <http://blog.wikimedia.org/2011/12/13/how-sopa-will-hurt-the-free-web-and-wikipedia/> ["Imagine a world in which every single human being can freely share in the sum of all knowledge. Help us make it a reality!"].   The Wikipedia community took its stance on SOPA and PIPA because we believe the bills are dangerous and harmful to our mission. We have had no discussion regarding how piracy should be fought because that question does not directly affect Wikipedia’s function. Therefore, we do not propose any alternatives to SOPA.

I hope this helps to address your question, and thank you again for writing to share your thoughts with us.

Yours sincerely, Benn Newman

Disclaimer: all mail to this address is answered by volunteers, and responses are not to be considered an official statement of the Wikimedia Foundation. For official correspondence, please contact the Wikimedia Foundation by certified mail at the address listed on http://www.wikimediafoundation.org

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