LouFest 2014: Cake’s John McCrea Talks | MusicTimes

“As much as I hated major labels and indie labels, probably more than anyone I know, one thing you can say for them is that they were able to translate the success of one band and invest in a new band that no one knew about. And there is nothing currently that is actually doing that anymore. So that’s a structural problem. But you know who is going to fight to keep the current status quo are the tech companies that have grease running down their faces and hands from the fat of their plunder.”


‘Piracy sites don’t love music – they love money’ | Music Week

“A pilot scheme saw a 12% drop in advertising [on piracy sites] from major household brands, the kind of big names that lend legitimacy to illegal sites,” said Javid. “It’s a small first step. But over time the list, along with action taken by payment facilitators, will provide a valuable tool for making copyright infringement a much less lucrative business.

“And that’s the best way to stop the career copyright criminals… Copyright crooks don’t love music – they love money, and they’ve been attracted to the industry solely by its potential to make them rich. Take away their profits and you take away their reason for being.”

Read the Full Story at Music Week:

Sons of Anarchy’s Kurt Sutter Is A Rock Star for Creators Rights

We love Kurt Sutter’s unapologetic response to Google and Silicon Valley’s assault on creators. Below are links to Kurt’s two editorials that are essential reading for all creators to understand what the “internet economy” means for artists of all disciplines.

Kurt Sutter Attacks Google: Stop Profiting from Piracy (Guest Column) | Variety

Google is in the process of systematically destroying our artistic future, and more importantly, the future of our children and grandchildren. They’re spending tens of millions of dollars each year on eroding creative copyright laws. I believe that if the creative community doesn’t intervene now, and by now, I mean, fucking now — we will be bound to a multigenerational clusterfuck that will take 40 to 50 years to unravel.

The last time this happened was in the 1950s, when the tobacco industry spent millions to hide the truth, and convince everyone that smoking cigarettes wasn’t really dangerous to your health.

Earlier this year, Kurt took to writing a response in Slate to an editorial by Google Lobbyist Marvin Ammori (which lead to a later editorial disclosure of Mr. Ammori’s relationships).

Not-So-Zen and the Art of Voluntary Agreements | Slate

Every writer, producer, actor, musician, director, tech wizard, and fine artist working today needs to be aware of what this all means for our future—we will lose the ability to protect and profit from our own work. Every kid out there who aspires to be an actor or musician or artist: This is your future that’s at stake. More importantly, everyone who enjoys quality entertainment: This impacts you most of all. Content excellence cannot sustain itself if it loses its capacity to reward the talent that creates it. Consider this clunky analogy: If your local car dealership started selling your favorite luxury car for $1,000, then $100, then started giving it away, what do you think would happen to the quality of that vehicle? Before long, the manufacturer would be forced to let go of the skilled laborer, the artisan, and the craftsman, and eventually cut back on everything in the production process. And before long, that fabulous, high-end car you so enjoyed will be a sheet of warped plywood on top of two rusty cans.

Yep, it’s cheap, and it’s shit.

Among the arguments that Kurt brings to light are the use of Merchants Of Doubt tactics by Silicon Valley interests, the mechanics employed by Google and YouTube detailed by The Digital Citizens Alliance and the ability for creatives of all disciplines to join Creative Future for a unified voice against these forces of exploitation.

The Future Of Music According to Gene Simmons and Jaron Lanier…

Gene Simmons may not be the most sympathetic figure in conversations about artists rights in the digital age but there is something to be said when he and Jaron Lanier make essentially the same observations about the future of music and artist revenue streams.

Simmons is quoted in a new interview in Esquire Magazine, “Rock Is Finally Dead”:

“The masses do not recognize file-sharing and downloading as stealing because there’s a copy left behind for you — it’s not that copy that’s the problem, it’s the other one that someone received but didn’t pay for. The problem is that nobody will pay you for the 10,000 hours you put in to create what you created. I can only imagine the frustration of all that work, and having no one value it enough to pay you for it.

It’s very sad for new bands. My heart goes out to them. They just don’t have a chance. If you play guitar, it’s almost impossible. You’re better off not even learning how to play guitar or write songs, and just singing in the shower and auditioning for The X Factor. And I’m not slamming The X Factor, or pop singers. But where’s the next Bob Dylan? Where’s the next Beatles? Where are the songwriters? Where are the creators? Many of them now have to work behind the scenes, to prop up pop acts and write their stuff for them.”

Simmons goes on to state that music and culture have stagnated.  He asks what great bands and artists have emerged in the post internet era?

Jaron Lanier made essentially the same observation back in 2010 in an interview with The New York Times, “The Madness of Crowds and an Internet Delusion.

“…authors, journalists, musicians and artists are encouraged to treat the fruits of their intellects and imaginations as fragments to be given without pay to the hive mind. Reciprocity takes the form of self-promotion. Culture is to become precisely nothing but advertising.

It’s as if culture froze just before it became digitally open, and all we can do now is mine the past like salvagers picking over a garbage dump,” Mr. Lanier writes. Or, to use another of his grim metaphors: “Creative people — the new peasants — come to resemble animals converging on shrinking oases of old media in a depleted desert.”

It speaks volumes when two people of such different backgrounds and perspectives make the same observation.

Are Pandora’s Disclosures Deficient Regarding pre-72 Exposure to a Music Genome Shut Off?

Some readers noticed that we spotted an interesting defect in Pandora’s most recent quarterly filing with the Securities and Exchange Commission and asked how big a deal is this defect.  Our understanding is that Pandora has been paying royalties on pre-72 recordings since its inception, but recently stopped, following which they were sued in NY state court by a group of record companies.  (Remember The Turtles are suing Sirius for much the same reasons.)

The pre-72 lawsuit challenges Pandora’s use of pre-72 recordings without compensation or a license.  (If you are unfamiliar with the “pre-72″ issue, it is essentially that federal copyright protection only covers sound recordings released after 1972.  Based on Pandora’s use of these recordings in its service without a license or compensation, you might get the impression that the pre-72 recordings had fallen into the pubic domain.  Nothing is further from the truth as the recordings are protected by common law copyright and a variety of state unfair competition statutes.)

Not only is Pandora using these recordings as part of its service in violation of the copyright owners’ exclusive reproduction right and public performance right, there is a question as to whether the music genome itself misappropriates each featured artist’s right of publicity by marketing the Pandora service based on channels created using the artist’s name, an issue that recently came up in the lawsuit brought by Goldieblox against the Beastie Boys and by the Ministry of Sound against Spotify in the UK.  Not unlike a fingerprint, the music genome is a copy of the underlying sound recording in a mathematical expression as we understand it, and to our knowledge no aspect of the music genome has ever been licensed.  It certainly is not covered by the compulsory license in 17 USC Sec. 114 (the webcasting compulsory license).

So the pre-72 litigation against Pandora is important not only because of the alleged violations of state law, common law copyright and unfair competition statutes, but also because it could draw attention to potential artist-related violations may go to the heart of Pandora’s business for both pre 72 and post 72 recordings.

What Are Pandora’s Disclosure Obligations under SEC Regulations?

A public company such as Pandora is required to make a variety of filings with the Securities and Exchange Commission so that the Commission, the company’s stockholders and the public (including the financial press) can have an idea of how the company is doing and how to assess the risk of owning the company’s shares.  The way that this assessment is communicated to the company, at least in part, is in the company’s share price.  If stockholders rely on the company to properly disclose risk, especially downside risk, then they may not look beyond these disclosures such as finding a copy of the copyright owners’ complaint.

Relying solely on these disclosures instead of doing your own research is not something we would recommend for reasons that will become apparent.  Pandora is a good example of why it’s good to drill down on the company’s disclosures (and in the case of the SEC, we’re a bit surprised that the examiners at the Commission didn’t catch this).

One of the risk factors that the SEC requires public companies to disclose is pending litigation brought against the company.  This should come as no surprise, as litigation can be an existential threat to a company and to the value of stockholder’s investment.  The SEC has very specific requirements about what is to be disclosed about litigation, and those requirements can be found in Regulation S-K (17 CFR Sec. 229.103):

§ 229.103 (Item 103) Legal proceedings.

Describe briefly any material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which the registrant or any of its subsidiaries is a party or of which any of their property is the subject. Include the name of the court or agency in which the proceedings are pending, the date instituted, the principal parties thereto, a description of the factual basis alleged to underlie the proceeding and the relief sought. Include similar information as to any such proceedings known to be contemplated by governmental authorities.

The “Instructions” for Item 103 provide guidance for materiality regarding legal disclosures:

2. No information need be given with respect to any proceeding that involves primarily a claim for damages if the amount involved, exclusive of interest and costs, does not exceed 10 percent of the current assets of the registrant and its subsidiaries on a consolidated basis. However, if any proceeding presents in large degree the same legal and factual issues as other proceedings pending or known to be contemplated, the amount involved in such other proceedings shall be included in computing such percentage.

Given the scope of the pre-72 litigation, it is easy to understand why Pandora would have an obligation to disclose the claim based on materiality alone.  Then the question is did they?

Did Pandora’s Disclosure Comply With Its SEC Disclosure Obligations?

Here’s Pandora’s disclosure in its 10Q:

On April 17, 2014, UMG Recordings, Inc., Sony Music Entertainment, Capitol Records, LLC, Warner Music Group Corp., and ABKCO Music and Records, Inc. filed suit against Pandora Media Inc. in the Supreme Court of the State of New York. The complaint claims common law copyright infringement and unfair competition arising from allegations that Pandora owes royalties for the performance of sound recordings recorded prior to February 15, 1972.

Pandora’s disclosure does not seem to comply with the requirements of Regulation S-K because the company does not disclose, or does not disclose fully, “the relief sought” in the lawsuit.  There is a claim for money–“allegations that Pandora owes royalties”–and also a request for injunctive relief–not addressed in Pandora’s disclosure at all.  The injunction would order Pandora to stop using the pre-72 recordings.  The claim for money relates to both the public performance of sound recordings–“for the public performance of sound recordings recorded prior to February 15, 1972″–and also to the reproduction of those sound recordings as part of Pandora’s operations–not addressed in Pandora’s disclosure at all.

Pandora makes only a minimal disclosure of “the factual basis alleged to underlie the proceeding,” some might say a flimsy and self consciously limited disclosure.  Given the historic nature of this litigation, one would think that Pandora would spend time getting a little closer to the requirements of Regulation S-K and erring on the side of more disclosure than less.

So–Pandora seems to be treading in the grey area of its disclosure requirements at a minimum.  One can be ambivalent about whether Pandora met its obligations for discussion of the facts.  But what is clear is that Pandora did not disclose the copyright owners’ request for injunctive relief and a court order blocking Pandora’s use of the recordings.  One could read the disclosure and come away thinking that it’s just a dispute about money.  It certainly is that, but it’s not only that.

Maybe Pandora’s senior management team (including their CFO as CFOs are very involved with SEC filings) didn’t think there was anything material about the injunctive relief.  If successful, an injunction could have some obvious and not so obvious effects on Pandora’s business.  We view the injunction as the relief that is most likely to succeed because of Pandora’s untenable position that it does not have to pay royalties but gets to keep reproducing and performing the pre-72 recordings.  Even if you believe that there’s no performance right in pre-72 sound recordings, there’s a serious question of whether Pandora is reselling unauthorized reproductions.

Shutting off pre-72 recordings would have the obvious result of blocking Pandora’s use of the recordings. Given that Pandora’s music genome relies on looking up music that sounds like other music to build their barely compliant channels, if Pandora suddenly lost the ability to use all music genomes for pre-72 recordings that might seriously affect its business.  No mention of that, either.

Why Didn’t Pandora Fully Disclose?

You can attribute any manner of motives to Pandora for treating their filing obligations like a press release that they can shade and spin the way they do so many other communications.  You can also wonder about what the senior management team was thinking when they approved the risk factor.  One thing seems clear though–they wrote it they way they wrote because they thought they would get away with it.

Our Songs = Your Photos & Privacy : After a Week of “Whack-a-Mole” Reddit Bans Celebrity Photo Forums

So how’s that DMCA working now?

We’ve written about this before in our posts “My Songs = Your Instagram Photos” and “Two Simple Facts about Technology and Piracy : iTunes Vs. YouTube.” Now Reddit experiences what musicians have been dealing with directly for over a decade, the flawed arguments of ignoring consent online.

Reddit community manager Lisa Liebig, explains:

“We understand that the moderators did the best they could with the situation at hand, but having users purposefully try and circumvent the takedowns was starting to become a whack-a-mole game,” Liebig said, adding, “These factors led us to decide that the subreddit and many of its sister-subreddits were in violation of rule five of the site, ‘don’t…do anything that interferes with normal use of the site.’”

Make no mistake about it, this is about intent. Either we allow lawlessness as the norm, or we enforce the same rule of online as we do in the physical world. Consent is cornerstone of civilized society and mob rule should not be tolerated (not even for free music or celeb nudes).

The same mentality and arguments that make it acceptable to hack and post personal photos have been used as an excuse to ignore the massive, for profit, theft of personal copyrighted works for more than a decade. Neither is acceptable. As the future of music is tied to ad funded piracy, so is privacy tied to internet profits by the same lack of personal consent.

We applaud Reddit for not standing on a soapbox conflating personal rights, privacy and consent with some twisted notion of censorship and some nonsense about “breaking the internet.” Indeed, as we noted in our post “Principles for an Ethical and Sustainable Internet” technology may change but principles do not. It would seem that at least just for today, maybe the internet is growing up, just a little bit…

Read the Full Story at ReCode:
Reddit Bans Celebrity Photo Forums After a Week of “Whack-a-Mole”

Spotify’s Daniel Ek is Really Bad At Simple Math, “Artists Will Make a Decent Living Off Streaming In Just a Few Years”

The future of music for artist revenue streams seems more uncertain than ever. Digital Music News is reporting a quote from Spotify’s Daniel Ek on CNN Money which appears to show the failure of the companies CEO to perform simple math.

It should be noted that Daniel Ek was also the CEO of uTorrent, “the world’s most popular Bit-Torrent client” which is advertising funded.

Spotify CEO: “Artists Will Make a Decent Living Off Streaming In Just a Few Years” | Digital Music News

CNN: At what point can an artist survive on a Spotify income?

Ek: Well, I mean, the interesting thing here is that we’re just in its infancy when it comes to streaming. And we just last week had an artist announcement where we basically said if there would be 40 million subscribers paying for a service like Spotify, it would be more than anything else in the entire music industry, including iTunes.

We don’t want to say Mr.Ek is lying, but he does appear to be very bad at simple math and to be misinformed about the actual size of the record business and the revenue being generated by Apple’s Itunes.

Is anyone actually capable of doing simple math in a spreadsheet? Here goes. 40m Spotify Subs at $10 a month is only $3.3b in annual revenue to artists and rights holders at paying out 70% of gross. How is $3.3b “more than” the current $15b total annual global revenue or the $7b in domestic revenue in the US?

Here’s the simple math…

40,000,000 * $84 = $3,360,000,000

$84 dollars per subscriber annually is calculated at $10 per month per subscriber paying out 70% to Artists & Rights Holders or, $7 per month. $7 per month, multiplied by 12 months equals $84 per year, per subscriber payable to Artists and Rights Holders.

40m Subscribers x’s $84 per year = $3.3b in annual global revenue to artists and rights holders (assuming they really are paying out 70% of gross).

Simple math.

If you are an artist you might also read these links below:

Music Streaming Math, Can It All Add Up?

Venture Capitalist Admits Artists Can Not Make A Living On Streaming Royalties…

The Internet Empowered Artist? What 1 Million Streams Means To You!

Streaming Price Index : Now with YouTube pay rates!

It appears to us that music streaming can only truly be profitable to those with participating equity in the streaming company itself. Those with equity are leveraging their catalogs of assets against the potential revenue of an IPO (in which the catalog of assets is being leveraged for that equity). Thus far however, it appears that the artists and songwriters who have created those assets as the basis for that equity leverage do not participate in any profit sharing that the equity shares may earn.

So it’s not that music streaming can not be profitable, it’s just that it can not be profitable (or equitable) to artists.

Please tell us which artists are being compensated from the $3b sale of Beats music to Apple? Let’s see a show of hands… Bueller… Bueller… Bueller…

Remember when we were told that in countries where music streaming was the most successful that transactional sales also increased? We’ve got a bridge in Brooklyn to sell you too, and cheap. More food for thought below.

Streaming Isn’t Saving the Music Industry After All, Data Shows… | Digital Music News

Album Sales Hit A New Low | Billboard

No Surprise Here: Spotify Streams Soar While Track Sales Fall | Billboard


Pre-72 Red Herrings from Pandora’s Chris Harrison (and that’s not the IPO kind)

Pandora executives are still prancing around cashing out stock options while telling their stockholders that they are intentionally stiffing American artists on recordings released after 1972–well…sort of telling their stockholders.  If their stockholders are also copyright experts.  Because what Pandora doesn’t tell their stockholders is that not only is Pandora not paying royalties, Pandora’s position actually acknowledges that Pandora is still exploiting these pre-72 recordings without any rights.  This is exceptionally bizarre because if Pandora just paid the statutory webcasting royalties under the U.S. Copyright Act, they would at least have a fig leaf that they actually had some kind of license.  

By saying that the recordings are not subject to the compulsory license like all the other recordings Pandora exploits, they essentially have no license for the pre-72 recordings (but do have the compulsory license for the post-72 recordings).  So then they have to prove that when the Congress created the statutory license for webcasting and the royalty system for royalty payments, the Congress actually intended to exclude all sound recordings before 1972.  (The magic of 1972 is that is the year that the Congress first included sound recordings in the federal Copyright Act–sound recordings previously were covered by “common law copyright” not no copyright.)

According to Pandora’s latest Form 10-Q:

On April 17, 2014, UMG Recordings, Inc., Sony Music Entertainment, Capitol Records, LLC, Warner Music Group Corp., and ABKCO Music and Records, Inc. filed suit against Pandora Media Inc. in the Supreme Court of the State of New York. The complaint claims common law copyright infringement and unfair competition arising from allegations that Pandora owes royalties for the performance of sound recordings recorded prior to February 15, 1972.

The outcome of any litigation is inherently uncertain. Based on our current knowledge we believe that the final outcome of the matters discussed above will not likely, individually or in the aggregate, have a material adverse effect on our business, financial position, results of operations or cash flows; however, in light of the uncertainties involved in such matters, there can be no assurance that the outcome of each case or the costs of litigation, regardless of outcome, will not have a material adverse effect on our business. In particular, rate court proceedings could take years to complete, could be very costly and may result in royalty rates that are materially less favorable than rates we currently pay.

This risk factor is actually misleading–not only is Pandora being sued for money, the lawsuit also asks for the court to order Pandora to stop exploiting the pre-72 recordings altogether:

A preliminary and permanent injunction preventing, enjoining, and restraining Pandora and its respective agents, servants, directors, officers, principals, employees, representatives, subsidiaries and affiliated companies, successors, assigns, and those acting in concert with them or at their direction, from directly or indirectly infringing in any manner any right in any and all Pre-72 Recordings in which any Plaintiff owns or controls an exclusive right under statutory or common law, including without limitation by directly or indirectly reproducing and digitally publicly performing any of Plaintiffs’ Pre-72 Recordings….

Don’t you think that Pandora should have told their stockholders that they might actually lose the right to use pre-72 recordings altogether?

Now what is interesting about this is that Pandora chooses to take a position that hurts artists (and union players and singers) whose performances are on pre-72 recordings based on this arbitrary cut off date.  Somehow they seem to think that a recent Copyright Office study supports Pandora’s decision to screw artists.  Here’s what the Copyright Office actually said (on p. 129-130):

In reviewing the potential application of section 114 [Pandora's compulsory license] to pre-1972 sound recordings, the [Copyright] Office believes that section 114’s statutory royalty requirements should apply to nonexempt, noninteractive digital transmissions of those recordings [meaning Pandora], thereby providing an additional revenue stream for older artists and works….The [Copyright] Office thinks it is unreasonable for the age of a sound recording to dictate whether royalties are paid on public performances by means of digital audio transmissions, so long as copyright subsists in that sound recording. Bringing pre-1972 sound recordings within the scope of federal protection would subject them to the statutory license and provide online music services with an easy means to offer lawful public performances of those recordings while offering copyright owners and performers a reliable new source of income.

What Pandora’s Chris Harrison (or “Artist Enemy Number 1″ as he is known around the Trichordist) says about the lawsuit is that Pandora favors something called “full federalization” of the pre-72 sound recordings (or “the entire history of recorded music” as it is known around the Trichordist).

Harrison says that Congress made the decision not to include pre-72 recordings when it created the digital performance right for sound recordings in 1995.  We think this is actually false–many of the members of Congress who were on the House Judiciary Committee in 1995 are still on the committee, and none of them have acknowledged that it was a conscious decision of the Congress to exclude pre-72 recordings.  However, we’re looking forward to the conga line of congressmen linking up to take ownership of the decision to stiff old guys and dead cats and their heirs from webcasting royalties like Harrison wants to do.

Because…think about it.  Even if you were the man who fell to freaking Earth, would anyone in their right mind think that American elected officials would create a legal goodie in the form of a statutory royalty–which is actually fair compensation for rights the law takes away from artists and copyright owners in the compulsory license that is necessary to avoid a “taking” under the 5th Amendment–but these American officials would say but not for thee?  You American artists who gave the world the rich history of blues, jazz, rock, R&B before 1972, nothing for you, sorry.  That’s not only insane, it explains why there’s no legislative history evidence supporting Pandora’s position.

Harrison also equivocates when it comes to acknowledging this thievery:  “We’ll still pay the songwriter”.  Not the question being asked.  But Harrison tells us that the loophole is Congress’s fault.  No, it’s actually Pandora’s fault–they were paying until Harrison arrived on the scene.  We wonder what the confluence of these two events have to do with each other.  The reason that the RESPECT Act was introduced–which Pandora opposes–was to clarify this loophole, or the “Pandora loophole” as it’s known.  The RESPECT Act is really just a technical amendment and shouldn’t be opposed by anyone.

Yet Pandora rejects the RESPECT Act in favor of “full federalization” of sound recordings.  Why is this?  We think that this is one of those ice in winter situations where somebody dreams up a problem that they try to convince you that you somehow have, then wants you to give up something real in order to get them to relent.  Bullies are exceptionally good at this when they are holding on to your lunch money.  All you have to do is lick their boots and they promise to give your lunch money right back to you because they’re really only thinking of your nutritional well being.

The reasons Harrison gives for Pandora’s position start with the RESPECT Act unfairly targeting Internet radio, because Internet radio is the only one who would pay more.  If the RESPECT Act just included terrestrial radio, then that would be all better.  (That’s using the term “reason” rather loosely.)

This, of course, is the usual fallacious crap we hear from Harrison and Pandora.  The point of the RESPECT Act as told by the bill’s author Rep. Holding is a “rifle shot” solution to fix the the problem with the digital performance royalty that Pandora has created–to fix the Pandora loophole.  It has nothing to do with terrestrial radio–just like the 1995 change that created the digital performance right had nothing to do with terrestrial radio.

That’s the point.  So for Harrison to say that the problem is that the RESPECT Act only deals with Internet radio is like saying the antibiotic your doctor prescribed only dealt with the infection you have today, not the limp from the broken leg you got 10 years ago.

Harrison says that Pandora wants this full-federalization thingy for the protections built into the Copyright Act for copyright users like fair use, the ability of libraries to keep archival copies, rights of termination of transfers for artists–and of course the DMCA safe harbors.

The only problem with this list of supposedly high minded and pure souled desires of Pandora is that none of the issues Harrison identifies have anything to do with Pandora.  Pandora doesn’t rely on fair use because they get a statutory license, they’re not a library, they have proven quite unequivocally that they don’t give a rats ass about artists and songwriters, and they don’t rely on the DMCA.

Which is the revealing part–because you know who does care about most of that list?

Google cares.  This is why Pandora’s position on “full federalization” makes more sense as the position of the Digital Media Association.  Pandora’s “full federalization” position requires Pandora to take on considerable risk that is not in the interest of Pandora’s stockholders, especially compared to the ill-will, lawsuits and infringement exposure for Pandora stockholders from the decision by Harrison to stiff the old guys and the dead cats and their heirs–like Duke Ellington, The Beatles, Louis Armstrong, Roy Orbison, Johnny Winter and The McCoys.  The dominant member of the DiMA is–Google.  And Google robs artists every day with ad-sponsored piracy alone.  Not to mention the incompetent CMS and Content ID.  This smells like inside Washington back scratching to us.

And Google controls all the advertising on Pandora through DoubleClick thanks to the Antitrust Division of the Department of Justice that permitted the Google’s acquisition of DoubleClick–which gives Google such leverage over Pandora that Doubleclick has its own risk factor in Pandora’s SEC filings:

 We rely upon an agreement with DoubleClick, which is owned by Google, for delivering and monitoring our ads. Failure to renew the agreement on favorable terms, or termination of the agreement, could adversely affect our business.

We use DoubleClick’s ad-serving platform to deliver and monitor ads for our service. There can be no assurance that our agreement with DoubleClick, which is owned by Google, will be extended or renewed upon expiration, that we will be able to extend or renew our agreement with DoubleClick on terms and conditions favorable to us or that we could identify another alternative vendor to take its place. Our agreement with DoubleClick also allows DoubleClick to terminate our relationship before the expiration of the agreement on the occurrence of certain events, including material breach of the agreement by us, and to suspend provision of the services if DoubleClick determines that our use of its service violates certain security, technology or content standards.

If we’re wrong about this, we are looking forward to Chris Harrison’s explanation of exactly why all these “full federalization” issues are in the best interests of Pandora stockholders, particularly when compared to the potential downside of being found an intentional infringer under common law copyright, unfair competition and possibly some state criminal statutes.

But he can leave out his hearts and roses serenade about how much he cares about artists and songwriters getting the termination right for common law copyrights.  We can take care of ourselves without his “help” thank you very much.

Blake Morgan on How Google Alerts Drive Traffic to Pirates and Hurt Indie Artists and Labels

Originally posted on MUSIC • TECHNOLOGY • POLICY:

After our post yesterday about how Google drives traffic to pirate sites through Google Alerts (also supported by Facebook and Twitter), I got a chance to speak to Blake Morgan of ECR Music Group.  (MTP readers will remember Blake from the #IRespectMusic campaign, still going strong.)

Blake had the same experience with his label mate Janita (whom we interviewed about her experiences in Washington, DC supporting the #IRespectMusic campaign).

nadler(L-R Tommy Merrill, Rep. Jerry Nadler (D-NY), Blake Morgan and Janita)

The point of this is that Google knows how many DMCA takedown notices it has received for certain sites.  Janita’s record was also pirated by myfreemp3 a site for which Google has received over 4,000,000 takedown notices just for Google search links.  How do we know this?  Google publishes the information in its “Transparency Report” (and for those who read this slide yesterday…

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Musicians POV: Spotify Isn’t Good for You – Full Post

Originally posted on The Trichordist:

Mikey’s Not Here

If you remember the old “Life” cereal ads, they featured kids who didn’t want to eat Life cereal because it was “good for you” so who would like that?  Test it out on “Mikey”, the hyper critical eater—”Give it to Mikey, he hates everyhing!”  And surprise, surprise, Mikey likes it.

So it is with Spotify.  Mikey may eat it, Mikey may even proselytize about its wonders of valuation, but Spotify is not only not good for you, it’s actually bad for you.  The good news is (maybe) there’s something every artist can do about it.  Unless, of course, they listen to “Mikey”.

Here’s the proposition:  From a financial point of view, Spotify’s payable royalties are neglibible–marginally better than a pirate site.   (See “Streaming Price Index“) Spotify is, of course, a licensed service and it is encouraging to see investment pouring in to its coffers.  Make no mistake–we’re…

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