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News from the Goolag: What if You Make a Deal with Spotify and It Turns Out to Be With YouTube?

August 31, 2015 Leave a comment

We’ve all heard from numerous sources that Spotify is in the middle of renegotiating their license agreements with at least the major labels.  What has gotten less attention is YouTube’s interest in buying Spotify.  Spotify’s exit to an IPO is getting cloudier by the day as another tech bubble bursts in Wall Street alongside a volatile stock market, one should not rule out an acquisition of Spotify and who better to do it than Google’s wholly-owned YouTube subsidiary.

Remember that we saw this July 21, 2014 story in Re/Code by the highly credible tech journalist Kara Swisher:

Omid Kordestani, who has just temporarily replaced Nikesh Arora as chief business officer of Google, is joining the board of Spotify, according to people with knowledge of the situation.

In addition, sources said, one of the search giant’s former execs, Shishir Mehrotra, will become a special adviser to CEO Daniel Ek and the company’s management.

The move is a fascinating one, especially since sources inside Google said that new YouTube head Susan Wojcicki has expressed interest in acquiring the popular online music service if it were for sale. It is not currently and there are no such discussions going on between the pair about such a transaction.

YouTube is so disinterested in buying Spotify that Ms. Swisher was evidently asked to revisit that July 21 story on July 22 to clarify the reference to Google’s potential purchase of Spotify–only.   She wrote:

…Spotify co-founder and CEO Daniel Ek has indeed met with Google execs about various and substantive commercial deals at YouTube, Google Play and Android.

“There has not been a single conversation about Google’s interest between the two,” said one source, reflecting many others. “There was never a price, never a negotiation, never anything.”

Like most truths in business, that will be true until it’s not.

Does YouTube have the money?  That’s hard to tell because of the total lack of transparency about YouTube’s earnings in Google’s already opaque balance sheet.  However, Morgan Stanley analysts have broken out an estimate of YouTube’s earnings revealing an astonishing profit margin and revenue growth:

They clearly have–or can get–the money.  Given the paltry royalty that YouTube pays to artists, songwriters, labels and publishers, a Spotify acquisition would put the proverbial fox in the henhouse.  And like all of Google’s other efforts, that means the already pathetic Spotify royalties could go into a nose dive.

So you have to ask yourself–what protections are built into the soon-to-be renegotiated Spotify deals to allow copyright owners to pull out of a license if involves getting further into the Google grasp?

Now that’s a special relationship

August 25, 2015 Leave a comment

According to the New York Times:

President François Hollande of France on Monday awarded the Legion of Honor, France’s highest award, to three Americans and a Briton for their role in stopping a gunman on a high-speed train traveling to Paris from Amsterdam on Friday.

The three Americans — Airman First Class Spencer Stone, 23; Alek Skarlatos, 22, a specialist in the Oregon National Guard; and their friend Anthony Sadler, 23 — received the honor in the gilded halls of the Élysée Palace, where they were joined by Chris Norman, 62, a British consultant….

A French citizen who was the first to tackle Mr. Khazzani but who has declined to be identified will receive the honor at a later date, as will Mark Moogalian, 51, a passenger with dual French and American citizenship who struggled with the attacker and is recovering from a bullet wound….

Mr. Norman, speaking in French to reporters after the ceremony, said he felt honored by the distinction. “I did what I had to do,” he said. “It wasn’t heroism, it was what needed to be done in a situation of survival.”

The three Americans did not speak publicly on Monday, but at a news conference on Sunday at the American ambassador’s residence, they brushed aside suggestions that they were heroes.

Right.  They were just there when the wheel went round.  But it did go round and they were there.

 

Spotify Apologizes for Using Your Music To Spy on Your Fans

August 24, 2015 Leave a comment

Digital Music News reports again today on the latest Spotify debacle, this time data mining from pretty much everything users do on the service including mining their contacts.

In our new privacy policy, we indicated that we may ask your permission to access new types of information, including photos, mobile device location, voice controls, and your contacts.

Let’s be clear–there’s really no reason for anyone to have a Spotify account if they’re not coming to the service because of some artist’s music.  So how they treat fans is very important.

Explain to me exactly why Spotify needs your fans’ contacts when you’ve already created the motivation to send the fan to Spotify in the first place?

And even if they could get the data mining into some socially acceptable format, do you think they are doing this for free or are they selling the data out the back door?

Why is the New York Times Coverage on Artist Rights So Oddly Inconsistent?

August 23, 2015 1 comment

If you read the New York Times Sunday Magazine (which probably means you’re over 40 or live inside of the Acela corridor), you may have noticed a story last week titled “The Creative Apocalypse That Wasn’t“.  This piece is another of these “Sky is Rising” type things bankrolled by the Computer & Communications Industry Association, aka Google.  I’m not accusing the author of being on anyone’s payroll (except perhaps the Times itself…more about that later), but I can’t help noticing the similarities.

Here is the author’s thesis:

But starting with [Lars] Ulrich’s [2000] testimony [in the Napster case and hearings], a new complaint has taken center stage, one that flips those older objections on their heads. The problem with the culture industry is no longer its rapacious pursuit of consumer dollars. The problem with the culture industry is that it’s not profitable enough. Thanks to its legal troubles, Napster itself ended up being much less important as a business than as an omen, a preview of coming destructions. Its short, troubled life signaled a fundamental rearrangement in the way we discover, consume and (most importantly) pay for creative work. In the 15 years since, many artists and commentators have come to believe that Ulrich’s promised apocalypse is now upon us — that the digital economy, in which information not only wants to be free but for all practical purposes is free, ultimately means that ‘‘the diverse voices of the artists will disappear,’’ because musicians and writers and filmmakers can no longer make a living.

Not surprisingly, this thesis leads to the following conclusion:

But just because creative workers deserve to make more money, it doesn’t mean that the economic or technological trends are undermining their livelihoods. If anything, the trends are making creative livelihoods more achievable. Contrary to Lars Ulrich’s fear in 2000, the ‘‘diverse voices of the artists’’ are still with us, and they seem to be multiplying. The song remains the same, and there are more of us singing it for a living.

The thrust of the article is essentially just because there is a lot of anecdotal evidence that artists are hurting in the post-Napster era doesn’t mean that they are.  And we can “prove” that by looking at government data sets.

The author notes:

The problem with the [Labor Department] data is that it doesn’t track self-­employed workers, who are obviously a large part of the world of creative production. For that section of the culture industry, the best data sources are the United States Economic Census, which is conducted every five years, and a firm called Economic Modeling Specialists International, which tracks detailed job numbers for self-­employed people in specific professions.

You know, rather than cherry picking data, there’s another good way to find out about how self-employed artists are doing–why don’t you ask them?  Case in point:  The Austin Music Office commissioned a study that did just that.  You can read Texas Monthly’s coverage on it.  Somebody at the Times might want to read it–and the data collected from 4,000 respondents from the artist, music business worker and venue owner communities.  The Census data drove the conclusion, and not the other way around.  I don’t think it supports the conclusions in the Times–conclusions that were all derived from inside a library by the look of it.

It’s interesting that the author starts with Napster and then largely restates and extends the narrative crafted by Napster’s litigation PR team.  You know:  Fire good, Napster bad.

Because the thesis in the Times dances around a narrative that’s straight outta 1999:  Blame the victim.  It seems carefully crafted to lead to the desired conclusion apparently driven by a number of factors.

1.  Omit Any Reference to Brand Sponsored Piracy:  The author’s basic argument about piracy is straight out of the CCIA playbook–yes, piracy is bad, but the artists make it up on live music.  This substitution argument allows the author to sidestep the entire issue of who profits from piracy, who drives traffic to pirate sites, in fact, the whole income transfer that is essentially at work in online piracy across all copyright categories.  And you know, some of the companies benefiting from piracy are the same people who sell advertising on the New York Times website and drive traffic to it.

Even if the author wanted to avoid mentioning they who must not be named (Google), he could at least have noted the big box brands that benefit from advertising cheaply to pirate sites that attract the same demographic as do more costly and less populated music sites.  I’m not really joking about not mentioning Google’s name–it only comes up once.

2.  Discuss Independent Bookstores with No Reference to Amazon:  Here’s the treatment for independent bookstores:

This would be even more troubling if independent bookstores — traditional champions of the literary novel and thoughtful nonfiction — were on life support. But contrary to all expectations, these stores have been thriving. After hitting a low in 2007, decimated not only by the Internet but also by the rise of big-box chains like Borders and Barnes & Noble, indie bookstores have been growing at a steady clip, with their number up 35 percent (from 1,651 in 2009 to 2,227 in 2015); by many reports, 2014 was their most financially successful year in recent memory. Indie bookstores account for only about 10 percent of overall book sales, but they have a vastly disproportionate impact on the sale of the creative midlist books that are so vital to the health of the culture.

This is a carefully worded paragraph.  Maybe I missed it, but I don’t see a cite for the number of independent bookstores.  I also note that the name “Amazon” doesn’t appear, nor the fact that Borders filed for bankruptcy and Barnes & Noble has been running on fumes for years (most recent evidence is that Barnes & Noble reportedly stopped paying its Marketplace sellers this month).

The author would have us believe that “the Internet” was only a contributing factor rather than Amazon being at least a significant cause for the demise of both indies and big box even prior to 2007, the year that Amazon launched the Kindle.  Amazon did what Amazon does best–use other peoples’ bricks and mortar stores as show rooms while offering the same goods at a lower price.  (Partly by dodging state sales tax.)  People didn’t stop buying books, they just stopped buying them from local booksellers.

Another major issue the author skipped is the brisk market for pdfs of pirated books on Torrent sites.  But why expect that level of nuance from someone who clearly can’t even see the boulder in his own eye.

3.  Everything is Awesome!  The author treats us to this list of glittering generalities:

And just as there are more avenues for consumers to pay for creative work, there are more ways to be compensated for making that work. Think of that signature flourish of 2000s-­era television artistry: the exquisitely curated (and usually obscure) song that signals the transition from final shot to the rolling credits. Having a track featured during the credits of ‘‘Girls’’ or ‘‘Breaking Bad’’ or ‘‘True Blood’’ can be worth hundreds of thousands of dollars to a songwriter.  (Before that point [which point?], the idea of licensing a popular song for the credits of a television series was almost unheard-­of.) 

Oh really?  And what is that statement based on exactly?  First the money–Maybe–maybe–if he’s talking about a major composer commissioned to write and record a  main title theme and score for a big series.  But end titles?  I think not.  I personally have licensed recordings for many, many television programs throughout the 1990s and 2000s and I know of plenty of “popular songs” that were in the end titles and none of them got “hundreds of thousands of dollars” for the songwriters.

Video-­game budgets pay for actors, composers, writers and song licenses. There are YouTube videos generating ad revenue and Amazon Kindle Singles earning royalties, not to mention those emerging studios (like Netflix and Yahoo) that are spending significant dollars on high-­quality video.

Here’s a hot tip–unless you’re bringing personality rights to a video game, music license fees have been in a steady state of decline since I did the first videogame sound track license for Road Rash 3DO where all the artists got a per-unit royalty on the game that A&M passed through to the artists on a non-recoupment basis.  It’s a cold day in hell that any videogame company pays a royalty for music (with the possible exception of Guitar Hero-type games).

Of course, video game budgets do pay for a bunch of employment.  Glad he brought that up.  So do record company and music publisher advances.  But we don’t see much discussion about the benefits of their demise.  The kind of discussion you might have if you did something like…oh, interview someone from a record company or music publisher.

Ad revenue from YouTube is a joke–even more confirmation that the author did no original research for the story.  It is certainly true that Netflix, Amazon and Yahoo are spending money on original programming having learned from the YouTube tsunami of shite.  That parenthetical is one of the few unquestionably true statements in the article.

Filmmakers alone have raised more than $290 million on Kickstarter for their creations. Musicians are supplementing their income with instrument lessons on YouTube. All of these outlets are potential sources of revenue for the creative class, and all of them are creatures of the post-­Napster era. The Future of Music Coalition recently published a list of all the revenue streams available to musicians today, everything from sheet-­music sales at concerts to vinyl-­album sales. They came up with 46 distinct sources, 13 of which — including YouTube partner revenue and ringtone royalties — were nonexistent 15 years ago, and six of which, including film and television licensing, have greatly expanded in the digital age.

The reward based crowdfunding is a real thing that I support, and the Patronism.com and Patreon models have appeal for musicians.  However, these crowdfunding models do not make up for the consistent investment in production, marketing and promotion spend from record companies or the sustaining advances from music publishers.  And please don’t tell me that the huge hit to musicians is going to be offset by music lessons on YouTube.

I find it odd that the author had the brass to mention the Future of Music study.  Here’s what FOMC had to say about their New York Times experience:

Earlier this month, the New York Times Magazine reached out to Future of Music Coalition with regard to a forthcoming feature. We like to help out with this sort of thing, because we know that music business structures and practices can be quite complicated, and think it’s important that journalists get the facts and context as correct as possible, whatever narrative they’re advancing. Last week, fact-checkers from the magazine followed up with FMC staff. There was a good deal of back and forth as we were provided short paragraphs, and later, individual sentences, from the article and asked to verify whether they were “true.” (Unfortunately, we weren’t provided with much context.)

Alas, what ended up running was rather disappointing. NYT Magazine chose to publish without substantive change most of the things that we told them were either: a) not accurate or b) not verifiable because there is no industry consensus and the “facts” could really go either way.

4. The Most Offensive Part:  As MTP readers will recall, we’ve been using the tag line “Your Survival Guide to the Creative Apocalypse” for a good long time.  Personally, I think that’s a lot cooler than “All the News that Fits” or whatever the NYT slogan is, I forget now.  So when we saw an article using “The Creative Apocalypse” attached to such an agenda driven post, it was particularly offensive.  Get your own damn title.

So…the real question is not what this author was up to.  The answer to that is not much.  Another example of what we’ve all come to expect.

The real question is what is the New York Times up to.  On the one hand we have great reporting at NYT by journalists like Ben Sisario who has some of the best music business writing out there.  He takes the time to actually talk to people, get both sides, and so some first rate analysis.  Trying to get at the whatchamacallit..you know, that truthiness thing.  This is what we expect from the New York Times, the newspaper of record.

But to have factcheckers cherry pick issues presented “how long have you been beating your wife” style and then to not even use the information in a side bar is really hard to understand as being anything other than agenda driven.   How difficult would it have been to run a companion piece saying that people disagree?

I’ve been reading the Times so long I can’t remember when I didn’t.  But this–this is really hard to understand.

If you find it incomprehensible as well, feel free to write to the Times public editor and let her know what you think:

Margaret Sullivan public@nytimes.com

DMN: Spotify’s New Tracking Terms Shows The Interlocking Influence of Google’s Seat on Spotify Board

August 21, 2015 Leave a comment

Digital Music News has excellent reporting on Spotify’s new terms of use controlling everyone’s use of the service.  The headline says it all: Spotify Is Now Tracking Your ‘Online Activity’ Even When You’re Not Using Spotify.

You’re now being tracked even when you’re not on Spotify, often through Spotify ‘business partners’.

Spotify TOSNow remember that we saw this July 21, 2014 story in Re/Code by the highly credible tech journalist Kara Swisher:

Omid Kordestani, who has just temporarily replaced Nikesh Arora as chief business officer of Google, is joining the board of Spotify, according to people with knowledge of the situation.

In addition, sources said, one of the search giant’s former execs, Shishir Mehrotra, will become a special adviser to CEO Daniel Ek and the company’s management.

The move is a fascinating one, especially since sources inside Google said that new YouTube head Susan Wojcicki has expressed interest in acquiring the popular online music service if it were for sale. It is not currently and there are no such discussions going on between the pair about such a transaction.

Google Adsense is one of the companies that Spotify uses to sell advertising:

Some of our advertising partners may use cookies and web beacons on our site. Our advertising partners are listed below:
– Google AdSense – Commission Junction – Adbrite – Widget Bucks – Kontera – Clickbank – Azoogle – Chitika – Linkshare – Amazon

And Spotify’s privacy policy says this:

We may use third-party vendors, including Google, who use first-party cookies (such as the Google Analytics cookie) and third-party cookies (such as the DoubleClick cookie) together to inform, optimize, and serve ads based on your past visits to our websites, including Google Analytics for Display Advertising.

Is anyone really surprised?

Google Glass Addiction: What Did They Know and When Did They Know It

August 20, 2015 Leave a comment

MIKE WALLACE
Fame has a fifteen minute half-life, infamy lasts a little longer.

From The Insider written by Eric Roth & Michael Mann, based on The Man Who Knew Too Much by Marie Brenner

The Insider is a very important film about Jeffrey Wigand, a scientist at Brown & Williamson tobacco company, whose whistleblowing formed the basis for the mass tobacco litigation brought by Mike Moore, then Attorney General of the State of Mississippi.  That case resulted in a $246 billion settlement for the participating states, including $4.1 billion for Mississippi.  (Moore is the predecessor of Mississippi Attorney General Jim Hood.)

One of the main themes of the story is that the tobacco companies not only knew tobacco was addictive, but they designed their product to enhance its addictive properties.  Mr. Wigand was forced to sign a nondisclosure agreement as a condition of his employment–which he breached despite significant legal pressure and anonymous threats against him and his family should he blow the whistle.

What becomes obvious from the tobacco case is that when a company puts a consumer product into commerce, the company typically will engage in a degree of testing to make sure the product meets safety standards, assuming there are any.  In the rush to modernity with “wearables”, most prominently Google Glass, we have to wonder whether and to what extent Google conducted tests to determine what affect Glass would have on users.

Particularly addictive effects.

I Asked You For Water, But You Gave Me Gasoline

You may well have wondered about the addictive properties of the Internet generally.  How many times have you seen people repeatedly check their smartphones for email, Facebook posts or likes, Tweets, and so on?  While the phone has other uses, Glass is a delivery system that puts this compulsive checking directly into your brain.  Kind of like a cigarette delivering nicotine directly into your blood stream.

Think that’s far fetched?  Let’s have a look at the Diagnostic and Statistical Manual of Mental Disorders (DSM-5), the shrink’s bible.  What does DSM-5 say about it?

In the fifth edition of the Diagnostic and Statistical Manual of Mental Disorders (DSM-5), Internet Gaming Disorder is identified in Section III as a condition warranting more clinical research and experience before it might be considered for inclusion in the main book as a formal disorder.

A New Phenomenon

The Internet is now an integral, even inescapable, part of many people’s daily lives; they turn to it to send messages, read news, conduct business, and much more. But recent scientific reports have begun to focus on the preoccupation some people develop with certain aspects of the Internet, particularly online games. The “gamers” play compulsively, to the exclusion of other interests, and their persistent and recurrent online activity results in clinically significant impairment or distress. People with this condition endanger their academic or job functioning because of the amount of time they spend playing. They experience symptoms of withdrawal when pulled away from gaming.

This means that the editorial board of DSM thought there was enough of an issue with Internet Gaming Disorder to warrant including it in DSM-5 with the suggestion that the phenomenon deserved further study with an eye toward including it as a formal disorder.

A closely associated phenomenon is “Internet Addiction Disorder” which is the more generalized version of Internet Gaming Disorder.   “IAD” like “IGD” has not been designated a formal disorder by DSM, but is a subject of interest.

So what does this have to do with Google Glass?

In a search of relevant peer reviewed articles at the National Institutes of Health, I came across this title written by a number of doctors:

Internet addiction disorder and problematic use of Google Glass™ in patient treated at a residential substance abuse treatment program.

The abstract describes the findings:

INTRODUCTION:
Internet addiction disorder (IAD) is characterized by the problematic use of online video games, computer use, and mobile handheld devices. While not officially a clinical diagnosis according to the most recent version of the Diagnostic and Statistical Manual of Mental Disorders (DSM), individuals with IAD manifest severe emotional, social, and mental dysfunction in multiple areas of daily activities due to their problematic use of technology and the internet.

METHOD:
We report a 31year-old man who exhibited problematic use of Google Glass™. The patient has a history of a mood disorder most consistent with a substance induced hypomania overlaying a depressive disorder, anxiety disorder with characteristics of social phobia and obsessive compulsive disorder, and severe alcohol and tobacco use disorders.

RESULTS:
During his residential treatment program at the Navy’s Substance Abuse and Recovery Program (SARP) for alcohol use disorder, it was noted that the patient exhibited significant frustration and irritability related to not being able to use his Google Glass™. The patient exhibited a notable, nearly involuntary movement of the right hand up to his temple area and tapping it with his forefinger. He reported that if he had been prevented from wearing the device while at work, he would become extremely irritable and argumentative.

CONCLUSIONS:
Over the course of his 35-day residential treatment, the patient noted a reduction in irritability, reduction in motor movements to his temple to turn on the device, and improvements in his short-term memory and clarity of thought processes. He continued to intermittently experience dreams as if looking through the device. To our knowledge, this is the first reported case of IAD involving problematic use of Google Glass™.

What Did Google Know and When Did They Know It?

The study begs the question what did Google know about the potential addictive properties of Google Glass?  Has the company performed any testing of Glass on human subjects?  If they did, what did they find?  And when?

While I haven’t done exhaustive research on the topic, I have yet to find any acknowledgement by Google that the company conducted any human testing of Glass at all.  It seems incomprehensible that Google never tested Glass on humans, so there surely must be some internal testing memos or other correspondence assessing the risks associated with putting a consumer product into contact with humans–particularly Glass, a system that delivers the Internet directly into the brain.

Of course, just like Brown & Williamson, any such testing is no doubt subject to one of Google’s famous nondisclosure agreements–not to mention the threat that Mr. Wigand faced, which is that “you’ll never work in this town again” for one reason or another

The chances that the users of Google Glass will ever find out what these studies demonstrated, should they exist, has a probability in the limit.

But you know who can find out?

I’m Shocked, Shocked: Payola on Spotify?

August 20, 2015 Leave a comment

RICK

How can you close me up? On what grounds?

RENAULT

I am shocked, shocked to find that gambling is going on in here!

CROUPIER

Your winnings, sir.

RENAULT

Oh. Thank you very much.

From Casablanca, written by Julius J. Epstein, Phillip G. Epstein and Howard Koch.

Can you imagine–someone in the music business is trying to buy their way into the charts.  Shocking, I know.  Totally unpredictable.  Who could ever have anticipated that move?

What about the payola laws, you say?  Good point.  The payola laws are supposed to protect the public from undisclosed payments received by disc jockeys (remember them?) and program directors from people trying to buy their way onto radio stations playlists.

Why would anyone want to buy their way onto a station’s playlist?  Chart position and sales.  The economic principle at work is competition for a scarce resource, in this case an “add”, as in getting added to the station’s playlist.

Why would an add be a valuable resource?  Two reasons:  The “Top 40” playlist format and the “Hot 100” Billboard chart.  Both of these institutions create scarcity where there was none and simultaneously create a very strong incentive for shenanigans.

When Billboard created its largely meaningless “consumption chart”, it baked number of streams into the new chart largely replacing radio airplay in a rush to modernity.  And by allowing itself to get caught up in the streaming bubble, Billboard created a giant incentive to dodge the payola rules.

The Federal Communications Commission established the payola rules for FCC licensees (meaning broadcasters) to require disclosure of payments and it is this nondisclosure that is what makes it illegal.

For broadcasters.

Not for Pandora (although there’s an open question about that given how hell-bent Pandora was to buy a radio station and become subject to payola laws).  Not the monopolist music subscription service Spotify or the other streamers.

So yep–the penny dropped.

If you can control the playlists on a streamer you can control the charts which will help your sales and marketing team, make the artist more attractive to promoters, agents, publishers.

And there’s no payola laws getting in the way because there’s no FCC jurisdiction.

As Pandora’s brilliant Washington, DC lawyer David Oxenford tells us:

“The payola statute, 47 USC Section 508, applies to radio stations and their employees, so by its terms it does not apply to Internet radio (at least to the extent that Internet Radio is not transmitted by radio waves – we’ll ignore questions of whether Internet radio transmitted by wi-fi, WiMax or cellular technology might be considered a “radio” service for purposes of this statute).  But that does not end the inquiry.  Note that neither the prosecutions brought by Eliot Spitzer in New York state a few years ago nor the prosecution of legendary disc jockey Alan Fried in the 1950s were brought under the payola statute.  Instead, both were based on state law commercial bribery statutes on the theory that improper payments were being received for a commercial advantage.  Such statutes are in no way limited to radio, but can apply to any business.  Thus, Internet radio stations would need to be concerned.”

Here’s a link to one of the few extensive articles on the subject.

It should come as no surprise then that Billboard now reports that labels paying for placement on influential playlists on services like Spotify.

Labels are incorporating playlist ­promotion into their overall marketing strategies with the knowledge that discovery through a list favored by, say, music supervisors can lead to synch licenses for a new artist. Radio stations also often use streaming data to inform their own spin cycles, with the rock and pop formats in particular looking to “see what’s bubbling up and amplify it,” says one digital music executive. “Stations don’t want to be behind what’s online.”

Like social media, playlists are viral in nature: A track’s streams will spike after it’s added to a popular playlist; listeners will add the song to their playlists; their friends will do the same. Getting a song onto a hot playlist almost ensures awareness will spread from one social network to another.

But–as Washington insider David Oxenford tells us, even if the FCC can’t get  jurisdiction over Spotify, state attorneys general may be able to investigate under applicable state law commercial bribery statutes.  So let’s not cast the net too narrowly here.  Just because Spotify isn’t an FCC licensee doesn’t mean that there’s not commercial bribery going on.  And that’s the kind of thing that can ruin your whole day.

Billboard noted that another Washington insider, Jonathan Prince, now Spotify’s head of communications said:

In a statement to Billboard, Spotify head of communications Jonathan Prince says its new terms of service, hitting the United States next week, prohibit selling accounts and playlists or “accepting any ­compensation, financial or otherwise, to influence … the content included on an account or playlist.”

Yet policing, let alone enforcing, these terms could be difficult. Spotify can investigate when allegations arise, and in the case of violations, delete a playlist or remove the user from the service. But there are loopholes.

This is kind of like user-generated content services saying in their terms of service that they don’t support copyright infringement.  They really really don’t.  Seriously, they don’t.  Not them.  Nope.  No way.  They don’t support it.  Which may be just a misprint.  It supports them.

What would be more interesting would be to know what is prompting this sudden attention to an issue that has been around for years?

Of course, Spotify board member Google has decided that any state AG with the brass to investigate them is just trying to impose what passes for “censorship” in the Google online echo chamber, so you can expect Spotify to sue any law enforcement officer with the temerity to start sniffing around.

You know…because The Internet.

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