Archive for November, 2012

The Artists, United, Can Never Be Defeated

November 29, 2012 Comments off

Yesterday on Capitol Hill did not quite go the way that the Internet Radio Fairness Coalition had in mind.  At all.  More about that will be written.  Mr. Chaffetz–more about him later, too–had asked Mr. Goodlatte for a hearing on the so-called Internet Radio Fairness Act, and a hearing he got.  I would say mostly a “listening” but that’s good, too.  The hearing was scheduled for 11:30 am and in a brilliant move, David Israelite of the NMPA scheduled a performance by five of our community’s top songwriters in an adjacent meeting room just prior to the IRFA hearing.

The writers were Lee Miller performing his song “You’re Gonna Miss This” (as recorded by Trace Adkins), Kara DioGuardi performing “Sober” (as recorded by Pink), BC Jean performing “If I Were a Boy” (as recorded by Beyoncé), Desmond Child performing his song “Livin’ on a Prayer” (as recorded by Bon Jovi), and Linda Perry performing her song “Beautiful” (as recorded by Christina Aguilera).

Of course there was a masterful political element to the timing and messaging of these songwriters, but first think about this–these writers performed their songs with a single instrument accompanying them.  Just one instrument and the voice, about the simplest instrumentation you can have.

And of course–the song.  These songwriters reminded the audience comprised of Members and staffers of the importance of the songwriter, and they did it by letting the songs speak for themselves.  By performing these songs–not with the vast instrumentation and production values of the recordings that interpreted the songs, they really and truly demonstrated conclusively that which every record company executive knows that is not a hype, not a self interested spin–it really and truly does all start with the song.

The combined Pandora earnings for these songwriters in the first quarter of this year was $587.39.  For over 33 million spins.

And Tim Westergren wants to pay them less.

It’s too bad that Tim wasn’t there for the sing along that Desmond Child led on the chorus of Living on a Prayer.  Since he used to play in a band and all, you would have thought that Tim would naturally gravitate to hanging out with his own kind.

I guess Tim was too busy to show up for a reminder of the investment that these writers are making in his company by giving him a break on royalty rates that all songwriters richly deserve.

When Pandora, and the NAB, and David Pakman and Google complain about royalty rates, remember that’s just about greed.  By handling themselves the way they have, all these people have demonstrated once and for all that they just don’t get it.

That’s OK, they are not our friends.  We don’t have to be friends with everyone we do business with.

But here’s the real deal: Without great songs there are no great records and without great records there is no Pandora.

And that’s the fact.

For Those Who Think the FTC Investigation of Google Doesn’t Implicate the Music Business

November 28, 2012 Comments off

When you read about the Federal Trade Commission’s investigation of Google, you may think this is just another example of Google’s getting away with it through crony capitalism.  You may think that it only involves maps, yelps, finance, and other products by companies that Google is ripping off and then jamming down in search.

Does this directly involve music and movies?  Yes, because Google is extending its search monopoly to video search by subsidizing YouTube with Google’s monopoly profits.  I’ve written about why Google should be forced to divest YouTube for this reason alone, and I still think that is a solid issue.

But think about all the problems that we have with Google search.  We have had these problems for years now and for years Google has either stonewalled us entirely or hidden behind the design defect they have built into search that perpetuates the theft of our music and movies on the one hand, and allows Google to drive the price down on the identical goods in the legitimate side of their business.

But what is most striking about the way Google continually fails to live up to even their own promises is the arrogance of the monopolist.  Think about the most recent promise to push illegal results down in search.  Fail.  Remember the many promises that Google’s General Counsel made to the House Judiciary Committee after COICA?  Fail.

Why does Google continue to float these sanctimonious plans for how they will do better this time?  Because it allows them to squirt out a smokescreen that so far has been effective.  Why do they continue to fail to live up to any of these announced plans?

Because they can.

This is the kind of abuse of their dominant positions that the FTC and the European Commission need to know about.  Because Google is doing everything they can to get out of being sued by the FTC and also having to live under a consent decree.

In other words–get out of any liability.

And as we all know, nothing says Internet Freedom like getting away with it.

IRFA Hearings: In Which Our Friend David Pakman Ignores Herds of Elephants in the Room

November 28, 2012 Comments off

If silence was golden, you could not raise a dime
Because your mind is on vacation but your mouth is working overtime.
By Mose Allison

I like David Pakman, he’s a good guy.  So, sorry, buddy, I just couldn’t let this pass.

In his testimony tomorrow at the House Judiciary Committee Subcommittee on Intellectual Property, Competition, and the Internet,  David is unfortunately going to engage in the jive of false causality.  There’s a bunch of it in his prepared remarks, but let’s focus on this bit here:

The digital music business is one of the most perilous of all internet businesses. We are skeptical, under the current licensing regime, that profitable stand-alone digital music companies can be built. In fact, hundreds of millions of dollars of venture capital have been lost in failed attempts to launch sustainable companies in this market. While our industry is used to failure, the failure rate of digital music companies is among the highest of any industry we have evaluated. This is solely due to the over-burdensome royalty requirements imposed upon digital music licensees by record companies under both voluntary and compulsory rate structures. The compulsory royalty rates imposed upon internet radio companies render them non-investible businesses from the perspective of many VCs….Yet the actions of the RIAA seem counter to this very goal [of a strong digital music market]. They have appeared on the opposite side of every issue facing digital music innovators, opposed to sensible licensing rates meant to achieve a healthy market. Regretfully, and perhaps most upsetting to all of us, the artists are the ones who suffer most. They depend on the actions of their labels to encourage a healthy market to grow and have little influence on the decisions of the RIAA.

First of all–and we’ll leave this to one side–notice what he did.  He started out talking about “over burdensome royalty requirements imposed…by record companies under both voluntary and compulsory rate structures.”  Then he switched to compulsory rates.  And then…big finish…he went after the RIAA.  This is soooo 1999.

Repeat after me:  The RIAA does not license anything.  Why talk about the RIAA in discussion about rates and licensing?  Remember–the RIAA doesn’t license anything.

Next, David is entirely oblivious to the impact of independent labels–those would be the labels that supported his eMusic company and do to this day.  I don’t quite understand how he could speak to the Congress on this important issue without even mentioning the indies both in the US and around the world.

But no discussion about profitability of digital music, and indeed the music business in general, can be taken seriously without mentioning the massive breakdown in private property rights resulting from piracy.  Any capitalist like David should be freaked out about this elephant because it goes to the heart of a market system that David would have you believe is failing because of licensing costs of licenses that the RIAA doesn’t issue.

There can be no market failure without a market and there can be no market without property rights that can be enforced at a market clearing price.  If the government has a history of failure in the music business, it is the failure to enforce the law in the face of massive and unprecedented online theft.  The Obama Administration and IPEC Victoria Espinel have done a great job playing catch up and should be commended.  But they are digging out of a deep hole.

So I have to say that there are so many elephants running through David’s testimony that it’s hard to understand what he’s actually trying to say.

Keep an eye on NYSE: P today.  This kind of testimony can’t help.

Canadian Writer’s Union Conducts a Little Direct Action–the Unmasked Remix

November 26, 2012 Comments off

The Writers Union of Canada visited a meeting of Canadian community college academics (whom I believe are all paid for by Canadian taxpayers) and tried to have a discussion about how the Canadian copyright law was being interpreted to deny writers substantial income from the use of their works in academia.

Here’s where thing got confusing–nobody was wearing a mask, so naturally the writers were asked to leave.  A word to the wise–if you want academics to engage with you, you need one of those white masks.  Or maybe a metaphorical sheet if none are available.

The “Free Culture” Book Report Redux: Terry Hart’s Part 1 on why the RSC “paper” really wasn’t ready for primetime

November 23, 2012 Comments off

Some of you may have heard about the “policy paper” that was posted on the website of the Republican Study Conference (which as near as I can tell is a kind of conservative caucus in the Congress) written by a Georgetown law student–and then promptly withdrawn by the RSC.  Why was the paper withdrawn?  As quoted in Variety (and many other outlets) the RSC spokesman said:

“On issues where there are several different perspectives among our members, our Policy Briefs should reflect that,” spokesman Brian Straessle said. “This Policy Brief presented one view among conservatives on U.S. copyright law. Due to an oversight in our review process, it did not account for the full range of perspectives among our members. It was removed from the website to address that concern.”

I’d put it a bit more bluntly: The report reads more like a book report on Free Culture rather than a bona fide policy paper.  For example, it omits many important issues that a government sponsored paper should take into account–such as the effects on our treaty obligations of the paper’s recommendations.

Terry Hart who writes the Copyhype blog has an excellent treatment of the paper:

Many on the internet were quick to declare the paper the absolute most stunningly brilliant paper history has ever produced. Techdirt’s Mike Masnick lamented the fact that, having read the paper, he will no longer be able to enjoy future papers, for they will only pale in comparison.

So not only are the usual suspects spinning about this startling deficient work product worthy of a Washington shillery like the CCIA or the Internet Radio Fairness Coalition (which of course may assume facts not in evidence) but we can’t help noticing that it is timed with the effort by Representative Zoe Lofgren (D-Google) to roil up the bots on Reddit to crowd source copyright reform…or something like that.

As Terry Hart says:

[A]ny debate or dialogue should begin with sound premises. This policy brief doesn’t. Instead, like an unfortunate strand of copyright skepticism, it runs from reality, rewrites history, and hides from logic.

How the paper got onto the RSC website, whether the author was in contact with a Google “evangelist” (which sounds like a lobbyist to me) apparently in violation of House rules and federal lobbying ethics laws, and why the typical outlets jumped so quickly onto a paper that only saw the light of day for a few hours late on a Friday afternoon all are questions to be answered in the fullness of time.

Google Ignores @carolynbmaloney and @janehamsher and Sells Ads for Russian Brides Sites

November 22, 2012 2 comments

MTP readers will remember the scandal over the Android Utoopi escort app that prompted Representative Carolyn B. Maloney to seek assurances from Google that the app would be removed from the Android Market (Apple never allowed it to be distributed in the App Store).

Not only did Representative Maloney call out Google about Google’s “sex club” app, but she also sent Google CEO Larry Page a bi-partisan letter with Representative Marsha Blackburn about Google’s predatory practices on human trafficking.  Given that there seems to be a never ending trail of prostitution busts from Craigslist, and other online advertisers, it should come as no surprise that Google’s Adsense also profits from this vertical in their human misery operation.

A casual Google search for “russian brides” reveals that not only does Google deliver search results for these sketchy sites, they also sell the ads.  They profit from human misery all day every day in countless ways.

Let’s understand something about Google–they will do anything for money and they really don’t give a rats patootie about the law, elected officials or the nation state.  And so far, why should they?  No one ever does anything about their debased business practices or would ever consider–arresting somebody.

Some Animals Are More Equal Than Others: Citizens Against Government Waste Opposes Internet Radio Fairness Act

November 21, 2012 Comments off

Have you seen the little piggies crawling in the dirt?
Always have clean shirts to play around in….
In their eyes there’s something lacking, what they need’s a damn good whacking…

Piggies, by George Harrison

The Council for Citizens Against Government Waste–home of the “Swineline”–announced its opposition to the so-called Internet Radio Fairness Act.  Yes, the publisher of the Congressional Pig Book took issue with a rasher of issues on the porcine legislation:

According to the Daily [Hog] Caller:

Council for Citizens Against Government Waste, a government watchdog group…joined in on the opposition [to IRFA] with a letter to the Senate Judiciary Committee  and the House Subcommittee on Intellectual Property, Competition and Internet on  November 16.

Council for Citizens Against Government Waste president Thomas  Schatz argued that the bill would bring Internet radio services under a  standard developed in the 1970s.

“The result is to move nearly 1,800 entities that currently operate under the  market-based standard down to the below-market standard, instead of moving the  three grandfathered entities up to the market-based standard,” he said,  referring to satellite radio providers SiriusXM and Musak, and cable music  providers like Music Choice.

And the bill proposes a new, political, presidentially appointed board that  will maximize the lobbying potential of the recipients of the government  subsidy,” said Schatz.

The Inmates Are Restless: @zoecello’s excellent idea meets the fog of trolls and the Bundler’s Dilemma

November 21, 2012 Comments off

I always say that the great thing about the Internet is that it brings people together who would otherwise might never have met.  The bad news is that regardless of the Internet, the place they would likely have met is prison.  Who are these people?  You know–The Trolls.  Often corporate backed attackers leaving pre-digested bits of astroturf in the comments on well-meaning and heartfelt blog posts.

And so it is with Zoë Keating’s excellent point about data.  What has brought out the trolls this time is something more commercially debased than just copyright–it is that Ms. Keating has pulled back a little corner of the curtain that conceals the Great and Powerful Oz.

Let’s be honest–for the Great Troll Google, every aspect of their business is about collecting data.  This has held true from the Wi-Spy debacle, to the debacle of Google’s near-indictment for profiting from the sale of illegal drugs, to YouTube.  And since Google presents the Federal Trade Commission with the classic Bundler’s Dilemma (how does a Presidential appointee prosecute a company whose executives have raised millions for the appointee’s boss and who provided the data crunching for a successful campaign?), it is unlikely that anything will stop the Great Troll Google.  And Google is a good proxy for the other services, because the other services know that all they need do is let Google fight that one for them.

And if Google don’t share their data with the US Government–we assume–then does anyone think Google will share their data with an artist?  Even if that data solely concerns her fans and her music?

In a word–no.  Not voluntarily, anyway.  To paraphrase Arthur Jensen (in Network), you are meddling with the primal forces of nature, Ms. Keating, and you will atone.

And that is reason alone for The Man 2.0 to send in the gangs of Straw Men, the Categorical Imperatives and other members of the intimidation squad.  And of course no one knows this better than the Head Trollette herself, Jill  Hazelbecker–at least according to the New York Times.  (When Ms. Hazelbecker was caught trolling on New Jersey Democratic Party websites on behalf of her Republican candidate.) That would be the same Jill Hazelbecker, now the Head Trollette of Google a/k/a Google’s Director of Corporate Communications and Public Affairs.  I wonder what Google found most compelling about her qualifications?

So we should not be surprised that Ms. Keating has been slashdotted and trolled–that’s actually confirmation that she has a startlingly brilliant idea that will send a shiver down the backs of incumbents.

You know–disruptive.

Critiquing The “Free Culture” Book Report or “The Copyright Education of Mr. Khanna”

November 20, 2012 Comments off

Forbes Magazine commentator Scott Cleland has an interesting blog post regarding the Republican Study Committee’s withdrawn book report on Free Culture…sorry, “policy paper” on copyright reform written by a committee staffer and boosted almost immediately by a number of Google Shill Listers.  In fact, Mr. Khanna’s LinkedIn bio–one does wonder where they find these guys–reveals the comforting assertion that Mr. Khanna advises (or advised) the Secretary of Defense on the important issue of cyber security.  (Did the Secretary know?)

Cyber-Security Policy Adviser

DoD Defense Science Board on Cyber-Security

March 2012– Present (9 months) Washington, DC

The Defense Science Board for the Secretary of Defense includes leading academics, scholars, visionaries (including Vint Cerf) and field experts in the scientific field to provide expertise to the Department of Defense.

I advise and present recommendations to the Secretary of Defense relevant to cyber-security.

A very serious person–unless you ask his section mates at Georgetown who may have a different view.

But I can’t help noticing the reference to Vint Cerf.  Who might he be, you may ask?

MTP readers will no doubt remember the torrid correspondence between Mr. Cerf and one Andrew McLaughlin, the former worldwide head of lobbying for Google who became the (unconfirmed) White House Deputy Chief Technology Officer for a brief time (Andrew, we hardly knew ye):

 or this one:

Violate the Presidential Records Act much?  MTP readers will remember that Mr. McLaughlin was shown the White House door over email correspondence with Googlers like Mr. Cerf.  A word to the wise for social climbing young Capitol Hill staffers.

McLaughlin drew heat earlier this year when it was discovered that he used his personal Gmail account to consult with former colleagues at Google — a breach of the ethics pledge initiated by President Barack Obama that prohibits White House employees from directly engaging their former employers and clients for at least two years.

McLaughlin was reprimanded for the incident, but the White House has maintained that the limited number of e-mails had no influence on any federal policy decisions.

Ah, right, because if Mr. Cerf did “influence federal policy decisions,” that would be a whatchamacallit…a crime.  McLaughlin left, nothing happened to Mr. Cerf.

Now…would it be meanspirited to think it was an issue that Mr. Cerf might have had communications with Mr. Khanna about his paper outside of official channels?  Only if Mr. Khanna was a “covered legislative branch official”.  You know, like someone who works for the Congressional leadership and is so important that he advises the Secretary of Defense.  But would Mr. Cerf be a mere “lobbyist”?

Yes, Vint Cerf is the Chief Internet Evangelist for Google.  (An new way to describe lobbying?)  Shocking, yes, I know, but Mr. Khanna seems to have been brought under the wing of Google.  You don’t think that there’s a connection between Mr. Cerf and the Google Shill Listers picking up on Mr. Khanna’s “policy paper” so quickly?  Nah….they all monitor the RSC’s website 24/7 dude.

Now who else’s thoughts echo through the “policy paper”?  Someone else whose pet projects got millions from Google?  Professor Free Ride himself?

For 14 years, a copyright owner would need to do nothing to receive the full protection of copyright law. But after 14 years, to receive full protection, the owner would have to take the minimal step of registering the work with an approved, privately managed and competitive registry, and of paying the copyright office $1.

This rule would not apply to foreign works, because it is unfair and illegal to burden foreign rights-holders with these formalities. It would not apply, immediately at least, to work created between 1978 and today. And it would apply to photographs or other difficult-to-register works only when the technology exists to develop reliable and simple registration databases that would make searching for the copyright owners of visual works an easy task.

I see.  Mr. Khanna evidently only wishes to punish American works of authorship and leave the other folks alone.  Yes, Mr. Khanna seems to want to disarm American intellectual property unilaterally–because I find it very hard to believe that any other countries that are signatories to the Berne Convention will agree to this proposal.  They’re not idiots.  Lessig’s plan was to change the US law then try to impose the radically shorter 14 year terms on the rest of the world.  You know who would be a good person to ask about this?  Chairman James Sensenbrenner.  I’m sure he could enlighten Mr. Khanna in a jiff.

Oh, that will go over so well. 

Here’s what I would like to know–I’d like to know the names of all the Republicans who intend to sign up to this “plan” of penalizing just the Americans.  Oh yes please–step right forward ladies and gents.  Raise your hand and take the pledge.

But while you’re waiting for that line to form, give a read of Mr. Cleland’s The Copyright Education of Mr. Khanna.  Unfortunately, this one doesn’t have a nice picture of Mr. Khanna to accompany it.

Something about copyright I think.

Why is Houston Congressman @repgenegreen Co-Sponsoring Union Busting IRFA?

November 20, 2012 Comments off

In a startling discovery, Rep. Gene Green (D-TX) has signed on to co-sponsor the union-busting so-called “Internet Radio Fairness Act.”  As MTP readers will remember, the union-busting bill is opposed by the AFL-CIO, and for good reason–it undermines the protections of assembly and expression guaranteed to unions under the Wagner Act (aka the National Labor Relations Act).

IRFA is not just a threat to artists, it’s one of those “if they can do that, they can do anything” pieces of legislation.  Rep. Green has enjoyed substantial support from union members in his district  including the Carpenters & Joiners Union, the Communication Workers of America, the International Longshoremans Association, the International Brotherhood of Electrical Workers, the Ironworkers Union, the Laborers Union, the Machinists and Aerospace Workers, the Operating Engineers, the Plumbers & Pipefitters, the Sheet Metal Workers and the United Steelworkers of America.

So why would Rep. Green support a bill that is so clearly designed to undercut the rights of union workers–to even speak out in opposition to Sirius and the National Association of Broadcasters–and is opposed by the American Federation of Musicians and the AFL-CIO itself.

Oh…Rep. Green is also supported by IFRA coalition member, the National Association of Broadcasters.  And you know how threatening that can be.  If you don’t, just read Section 5 of IRFA.

If you have a question for Rep. Green, you can tweet him @repgenegreen


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