Staff picks from Semaphore Music
1. Jess Moskaluke (Langenburg, Saskatchewan) “Catch Me If You Can” @jessmoskaluke
2. Storm Queen (Brooklyn) “Look Right Through”
3. St. Spirit (Crystal Palace) “Pigeon” @stspirituk
4. Axis Of (Port Stewart) “We Dine on Seeds” @axisof
5. Life Size Maps (Brooklyn) “Weird Luck” @lifesizemaps
We’ve been banging the table about the changing scope of the term recording artist agreement and the various state laws that regulate talent agents for about 10 years now. Erin Jacobson’s excellent article “360 Deals and the California Talent Agencies Act: Are Record Labels Procuring Employment” published in the ABA Entertainment & Sports Lawyer is a must-read for anyone who practices in this area.
Thanks to Erin for providing these important insights.
In his continuing quest to undermine the interests of copyright owners, Professor Lessig is at it again with his op-ed: Lucasfilm's Phantom Menace in which he takes on Lucasfilm and George Lucas for the rules they established for allowing users to “remix” some Star Wars footage with other works. Lucasfilm takes the not unreasonable position that in consideration for letting people have access to Star Wars, Lucas owns the results. Lester Lawrence Lessig III doesn’t like this. Lucas should give up copyright ownership to those creating derivatives from some of the most valuable motion pictures of the 20th Century--or 21st for that matter.
And wait for it…according to LLL III, Lucas should pay these users for anything they create that Lucas wants to use.
Trip Lessig starts picking through the end user license from Lucasfilms and goes off on an anti-lawyer jag just like someone who’s never worked with an artist would. According to the Tripster, it’s the HOLLYWOOD LAWYERS who have fought innovation and lead little directors like George Lucas around on a leash.
Schmuck—it don’t work that way. Does Lessig think no one asked Lucas what he thought about who could own his property? Does Lessig also think that if there was something really cool and usable that got created as a result of permitting users to get their hands on Star Wars that the players involved would rely on a freaking click through end user license agreement as their grant of rights? Maybe these things happen in the world of the confused Creative Commons--which must be like being at the executive session of the board of directors of a lemonade stand--but in the bigs it is highly unlikely.
In the world outside of Stanford, things like this typically do not happen. Someone would find the user, make a deal, and pay them off. Or they wouldn’t use it.
I love this line from the Tripster: “How better to revive a 30-year-old series than by enlisting armies of kids to make the content interesting again?”
Ah yes. How better to "revive" the franchise than to allow an "army of kids" to get into the act. Lessig must think that Star Wars is in dire need of resuscitation. That 2005 opening weekend of Revenge of the Sith conclusively demonstrates that the franchise is in deep wookie chips. That would be the $108 million weekend that was then the second biggest opening EVER in the US and the biggest opening EVER outside the US. Another little datapoint for the Tripster: Revenge passed $300 million in global box office faster than any movie in history.
(Lessig also describes these “armies of kids” as free labor, and uses the highly offensive term “sharecroppers” to describe our little suburban friends Corky and Muffy playing with Star Wars “remixes” on their cozy side of the digital divide safe in their Stanford dorm room. Considering the source, I'm willing to believe he just doesn't know how insulting this is. But then he probably claps on the 1 and 3, too.)
Here’s a newsflash for the Stanford madrassah: It’s not like Lucas needs help with selling the Star Wars franchise. $2.6 BILLION in box office alone. Rumor has it that a chunk of Star Wars net profits goes to support the USC film school (not quite as rich as the Google/Stanford relationship, but we Hollywood types have to stumble through life somehow.)
So Lucas has been supporting "remixing" for quite sometime, albeit in the controlled environment of the excellent film school at USC in sharp defiance of L3III obsession with letting all amateurs have a crack at other peoples property (so well described in Andrew Keen's The Cult of the Amateur, an excellent book.) Of course film schools honor copyright and create new generations of professional creators, but unbridled "remixing" by amateurs destroys copyright, and de-incentivises new generations of professional creators. One gives us greatness the other gives us...YouTube. Which shouldn't be surprising given that Google is the benefactor of Professor Lessig's business unit at the Stanford Law School. [Editor Charlie says: Remember this was written in 2007--YouTube recently announced it was spending $150 million in the US and millions more in the UK to develop premium channels for YouTube. Only a handful of the "YouTube stars" are participating--which probably says more about Google's ulterior motives in subsidizing the YouTube data collection honeypot than it does the work of the YouTube artists.]
Once again a major media organ gives Lessig a megaphone for what is simply gibberish. I really wish they’d check their facts before they publish this kind of thing. I know it’s not as interesting as watching Farting in Public on YouTube, but I thought it was called journalism.
So yes Lucas wants to own anything created with his work. Yes it’s supposed to be fun for fans. And yes, life would go on if no one ever “remixed” a thing.
Like any good wannabe demagoogle, Professor Lessig likes to speak for “armies of kids” to create the impression he has a mob of “sharecroppers” in the wings.
What a joke.
Here’s a little experiment: Try using Google Adwords “keywords tool”–a program that suggests Google Adwords matched to keywords you enter. Meaning, if you want to buy an Adword because you are selling, for example “harry potter movie”, it will tell you the most popular Adwords you can buy.
Just to cut to the chase, try searching for “free harry potter movie” and see what happens. Let me save you the trip (it requires CAPTCHA):
“free harry potter movie” gets 90,500 global monthly searches (up from 60,500 a year ago when we first tried this experiment).
But “free movies”? Holding steady at 45,500,00 global monthly searches (right next to “free movie for free”).
“torrent” had 226 million global monthly searches
“torrent movie” had 6.12 million.
A keyword search based on the website www.grooveshark.com revealed some interesting opporunities with over 30,000,000 global monthly searches, and of course that old chestnut www.thepiratebay.org pushed global monthly searches for certain keywords over 500,000,000.
You get the idea. How would Google ever know it was profiting from Adwords advertising for illegal goods until the creators track down all their torrents?
This is a video of a great panel at the Creators Conference including a keynote by Robert B. Levine and our friends Rick Carnes and Helienne Lindvall, as well as many other thoughtful speakers. This is about an hour long, but you should watch the whole thing if you can.
COMPLAINT (Summons Issued); jury demand; against Nikesh Arora, Sergey Brin, L. John Doerr, Google, Inc., Paul S Otellini, Larry Page, Patrick Pichette, Eric E Schmidt, K. Ram Shriram, Shirley M Tilghman ( Filing fee $ 350, receipt number 34611064016). Filed by Patricia M McKenna. (bw, COURT STAFF) (Filed on 8/29/2011) (Entered: 08/30/2011)
Summons Issued as to Nikesh Arora, Sergey Brin, L. John Doerr, Google, Inc., Paul S Otellini, Larry Page, Patrick Pichette, Eric E Schmidt, K. Ram Shriram, Shirley M Tilghman. (bw, COURT STAFF) (Filed on 8/29/2011) (Entered: 08/30/2011)
“The Internet allows messages to be better focused on particular groups of potential customers. With that ability comes the growing possibility that the Justice Department will view search engines as more than mere passive conduits of information, and instead as potentially active participants in conduct that may violate the law.”
For every lawyer who argued with me when I forbade them board memberships. It’s not a gym.
Staff Picks by Semaphore Music
1. Jessie Baylin (Los Angeles) “Hurry Hurry” @jessiebaylin
2. Atlas : Empire (Glasgow) “At the Edge of the Ravine” @atlasempireuk
3. Forest Fires (Aberdeen) “Best Intentions” @Forest_Fires
4. Frankie Rose (Brooklyn) “Soma” @missfrankierose
5. Keyboard Kid (Seattle) “Breathe In” @keyboardkid206
[A blast from the past, first posted Oct, 2010.]
Felix “BYOB” Oberholzer-Gee take note–nobody believes you.
Check out Mike Lombardo Music and follow @mikelombardo
Patronism.com (and @patronism) allows artists to create a patron-type relationship with their fans and give their fans steady access to the artist’s music. Each artist decides how to structure that relationship, how much to give and how much to charge. The site is the brainchild of Austin artist John Pointer, truly one of the most gifted performers and vocalists I’ve ever heard (or seen).
Not a surprise–Patronism is not trying to be all things to all people and there is an A&R process to being able to participate in the site. We like that–no get big fast here, just get good faster.
Although I’ve heard a lot of claims for “new income streams”, Patronsim may actually be a completely new income stream that doesn’t “cannibalize” any others.
When Kim Dotcom partied down at his ill-fated 38th amongst the exotic game and other toys at Xanadu Dot Com in New Zealand, he naturally invited his head of advertising sales, Finn Batato–which made the arrests that much more convenient. Mr. Batato subsequently was allowed to post bail and is now awaiting extradition in New Zealand having been afforded a lot of time to think about it, relatively speaking.
Based on his job description, I would suggest that Mr. Batato is probably the most interesting of the bunch of defendants, at least if you want to understand the breadth and scope of the what the indictment calls the “Mega Conspiracy” and how far it goes outside of Megavideo.
Down to a Sunless Sea
I began thinking about this over the last few days when it became apparent that a new meme had surfaced with the Google surrogates. (Watch how messaging later adopted by Google in its many legal scrapes begins to surface online and from which sources. You will get an idea of who these people are.)
The new narrative is that shutting down Megavideo accomplished nothing to stop piracy so why bother? It’s all just whack a mole after all so what justifies the law enforcement resources spent on extradicting the Mega Conspirators? Yes, and if that’s true, how about that assault, battery, rape, murder, burglary and theft? Talk about whack a mole! What’s up with that!
So how would you know the utility of spending law enforcement resources (the cost) without also knowing the losses due to piracy on Megavideo (the absence of which would be a benefit)? Trying to calculate lost sales inevitably makes for argument and can lead to people like the Government Accountability Office suggesting that policymakers should take into account the positive effects of crime in these calculations. Yes, it’s true.
But another good way to calculate these losses might be with reference to how much someone else made off of the sale of stolen goods–in the case of copyright from the theft of the reproduction and distribution rights (or the making available rights) reserved to copyright owners. This measurement would be at least a starting place for the number of infringing copies and at least someplace tangible to start a statutory damages calculation. Because it is possible to calculate exactly how much adserving companies and the pirate customers made from trafficking in stolen property. Particularly with a subpoena and a badge.
Ad-driven streams, torrents or downloads are, after all, frequently monetized on sites like Megavideo even though they are unauthorized. Advertising on pirate sites is not what either the advertiser or the copyright owner bargained for or even wanted, but were monetized nonetheless.
And the good news is that most of that money was made through credit card accounts or advertising sales so are on some level trackable. So as Google has suggested on numerous occasions–follow the money.
Following the Money
The Mega Conspiracy indictment tells us (at paragraph 18):
“Before any video can be viewed on Megavideo.com, the user must view an advertisement. Originally, the Mega Conspiracy had contracted with companies such as AdBrite, Inc., Google AdSense, and PartyGaming plc for advertising. Currently, the Conspiracy’s own advertising website, Megaclick.com, is used to set up advertising campaigns on all the Mega Sites. The high traffic volume on the Conspiracy websites allows the Conspiracy to charge advertisers up-front and at a higher rate than would be achieved bythe percentage-per-click methodology used by other popular Internet advertising companies. The popularity of the infringing content on the Mega Sites has generated more than $25 million in online advertising revenues for the Conspiracy.” (emphasis mine)
“Originally” in the case of Megavideo was about 2005. The indictment also states that:
On or about May 17, 2007, a representative from Google AdSense, an Internet advertising company, sent an e-mail to DOTCOM entitled “Google AdSense Account Status.” In the e-mail, the representative stated that “[d]uring our most recent review [as opposed to earlier reviews?] of your site [Megaupload.com,]” Google AdSense specialists found “numerous pages” with links to, among other things, “copyrighted content,” and therefore Google AdSense “will no longer be able towork with you.” The e-mail contains links to specific examples of offending content located on Megaupload.com….
AdBrite, Inc. (AdBrite.com) is an online advertising network based in San Francisco, California. AdBrite, Inc. provides advertisements for over 100,000 Internet sites and is believed to be amongst the top ten advertising networks on the Internet. From on or aboutSeptember 2, 2005 until on or about May 24, 2008, AdBrite paid at least $840,000 to the MegaConspiracy for advertising….
PartyGaming plc is a company based in the United Kingdom that has operated PartyPoker.com since 2001. PartyPoker.com has more than 3 million visitors annually and is one of the largest online poker rooms. PartyGaming’s advertising contract with the members of the Mega Conspiracy was initiated on or about November 12, 2009 and has resulted in payments of more than $3,000,000 to the Conspiracy. This contract was still active as recently as on or about March 18, 2011.
These three supporters of Megavideo would on the surface have little to do with each other. And maybe they don’t. But never underestimate the interconnectedness and influence of Silicon Valley VCs and luminaries. (If you ever doubted it before, you should not doubt it at all after the Google Spring which gave a handy roadmap for future use.)
For example, AdBright and Google are both Sequoia companies. MTP readers will no doubt remember Partygaming–this is the company whose co-founder, Anurag Dikshit, made big contributions to Creative Commons through his Kusuma Trust charitable foundation, and also to the U.S. Treasury when he made a plea deal for $300 million after violating the online gambling laws of the United States. (See Poker Money and the Ethics Professor) The Kusuma Trust also funds the Centre for Internet and Society in India which looks remarkably similar to the Center for Internet and Society at Stanford–another Stanford operation founded by guess who and funded by–Google. The common theme? Guess who. Does it prove anything? Time will tell.
Of All the Cyberlockers in all the World, She Walks Into His
So you may well ask yourself, of all the companies in the world that might advertise on Megavideo, how is it exactly that the big one that helped get Megavideo in business was Partygaming? What are the odds of that? Probably better than 649,740 to 1, which the Poker Prof will no doubt recognize as the odds of being dealt a royal flush. How in the world did Megavideo and Partygaming find each other? Perhaps a handy introduction in furtherance of the enterprise?
Another strange coincidence is that even though it would appear that Google Adsense terminated at least one Megavideo account for copyright infringement in 2007–two full years after it appears from the indictment that Google, Adbright and Partygaming helped Megavideo get in business–there is documentation that Google was still serving advertising in connection with illegal content from Megavideo cyberlockers. (See extensive research on this by Ellen Seidler at Popup Pirates.)
For the adserving companies, if AdBright paid $840,000 to the Mega Conspiracy as the indictment alleges, then Adbright pocketed a good chunk off those transactions itself–probably a like amount. And continued to do so well after Adsense terminated at least the account that they were writing about as quoted in the indictment.
“And all should cry: ‘Beware! Beware!’”
And this will always be true–the site operator arrested in Operation Fake Sweep allegedly had at least one Adsense account. The TVShack operator currently being deported from the UK to stand trial in New York is alleged to have made £150,000 in advertising revenue from selling unauthorized copies of other people’s work. Whatever these customers of adserving networks made, it is likely that the adserving network, such as Adsense in the case of Operation Fake Sweep or in the Mega Conspiracy, made a like amount.
So I can’t wait to hear the Googley legalistic explanations of how Google doesn’t profit from piracy. (Unlike the way Google profited from violating the controlled substances laws.)
But one thing is certain–who knows what evil lurks in the hearts of adserving companies.
Only Finn Batato knows.