Major Online Businesses are Unregulated Monopolies : Jon Taplin USC Lecture Chapter 4 [Video]

The USC Lecture Serialized Into Chapters for easier viewing. Chapter 4, Major Online Businesses are Unregulated Monopolies.

Read The Blog Post Here:
https://medium.com/@jonathantaplin/sleeping-through-a-revolution-8c4b147463e5

Watch the Full Lecture Here:

Techno-determinism and Internet Fundamentalism : Jon Taplin USC Lecture Chapter 3 [Video]

The USC Lecture Serialized Into Chapters for easier viewing. Chapter 3, Techno-determinism and Internet Fundamentalism.

Read The Blog Post Here:
https://medium.com/@jonathantaplin/sleeping-through-a-revolution-8c4b147463e5

Watch the Full Lecture Here:

5 Reasons The Major Labels Didn’t Really Blow It With Napster | Hypebot

Whatever the reason, it’s bullshit. The major labels were right not to compromise with Napster. I was VP of Electronic Music Distribution at Sony Music at the time, dealing with these issues day to day. Understandably, some people may think, what does it matter if the majors were right or not? They lost. But I think its important to understand the various facets and history of these events, if only to provide perspective for issues the industry is still dealing with today.  So, at the risk of being unhip, here are Five Reasons Why The Major Labels Didn’t Blow It With Napster.

READ THE FULL POST AT HYPEBOT:
http://www.hypebot.com/hypebot/2015/05/five-reasons-the-major-labels-didnt-blow-it-with-napster.html

Spotify is the Problem, Not Labels. (Well, Mostly…)

There is a narrative that keeps getting repeated by Spotify apologists and propagandists. It goes something like this, “The problem is not that Spotify pays too little to artists it’s that record labels are not paying the artists their fair share of royalties from Spotify.” Ha! When the gross payable is half a cent or less we think this has a lot more to do with Spotify than labels.

But this idea that labels are the problem pretty much means that Spotify ignores or otherwise feels that any artist not signed to a major label is unimportant in this conversation and that’s too bad.

We don’t know how many artists and small DIY indie labels aggregate to Spotify via Tunecore and CDBaby for example but we suspect it’s literally THOUSANDS of artists that are not signed to major labels (or ANY label). These are artists who are collecting either 100% of their Spotify royalties directly (Tunecore) or collecting those royalties after a 9% dist fee (CDBaby).

When Spotify shifts the blame for low royalties they are ignoring and invalidating all of the artists not signed to major labels, or any label. There are no industry middlemen taking Zoe Keating’s royalties from Spotify. The per stream rate is just incredibly, horribly bad. 

There are high profile artists such as Zoe Keating and others who echo the sentiments of artists across all strata’s of the business. The economics of Spotify are just unsustainable from the top down at present rates.

Everyone knows that record labels advance massive amounts of money to develop the careers of those artists signed. These advances are recouped from monies earned in royalties. One can argue about the recoupment mechanics but it doesn’t change the fact that with so little money being generated by Spotify the problem is much greater then the labels.

It’s also interesting that in all the talk of democratization and empowering musicians how little of it appears to be actually happening.

99.9% of Tunecore Artists Make Less Than Minimum Wage…

If the Internet is working for Musicians, Why aren’t more Musicians Working Professionally?

We’ve detailed numerous times how at the top end of the food chain, the Spotify math just doesn’t work and would require more subscribers paying $9.99 a month then any other mature premium subscriber business has achieved to date.

Here’s some context for the chart above. Netflix only has 36m subscribers in the US, no free tier, and massive limitations on available titles of both catalog and new releases. Sirius XM, 26.3m in the US as a non-interactive curated service installed in homes, cars and accessible online. Premium Cable has 56m subscribers in the US paying much more than $10 a month and also with many limitations. Spotify… 3m paid subscribers in the US after four years. Tell us again about this strategy of “waiting for scale.” Three Million Paid… Three…

* 3m Spotify Subs Screen Shot
* 26.3m Sirius XM Subs Screen Shot
* 36m Netflix Subs Screen Shot
* 56m Premium Cable Subs Screen Shot
* $7b Music Business Screen Shot

And, just so everyone is clear, we’re not giving the labels a free pass either. But Spotify’s divisive punt to blame the labels for their own bad business model isn’t fair. We’ve reported on the 18% equity stake the labels took as part of their licensing agreements. That’s an 18% equity stake that we’re pretty sure the artists won’t participate in at the time of an IPO or sale (should there be one).

The larger issue in this conversation however is that if Spotify and on demand streaming services can not generate the same or more revenue then transactional sales, then the model is a net negative for artists.  This has nothing to do with labels and everything to do with a flawed business model. Removing the free Ad-Supported tier after a limited time is probably the first, best and most obvious immediate solution but not the only one that should be addressed.

Spotify can not hide behind their bad math by shifting blame to labels when so many artists are getting their royalties from Spotify directly without labels.

 


 

Spotify Must “Adapt Or Die” : Pricing For Sustainability

 

Five Important Questions For Spotify from Artists and Managers

 

Streaming Is the Future, Spotify Is Not. Let’s talk Solutions.

 

Dead Kennedys’ East Bay Ray: The ‘Free Internet’ Will Not Set You Free | NY Observer

These Internet theorists also invariably fail to distinguish between the profound moral difference between sharing something with a friend and distributing, without permission, other people’s files for profit. It’s a crucial distinction.

One of the reasons that this distinction is not brought up is because the Internet corporations don’t want you to see much discussion about the enormous riches being made on the Internet from both the consensual and nonconsensual selling of your information to advertisers, as if it didn’t matter. The advertising system has money and money is power. Ask yourself: Are you gaining real power over your destiny from the Internet, or just stuff?


If Streaming is the “Solution” to Piracy, What Happens When Piracy is Streaming? Rot Oh… #sxsw

A big talking point of streaming, particularly of the Spotify variety has been that streaming is a solution to piracy, and that “access over ownership” models are the future.

Well… ok… but that assumes that piracy (of the corporately sanctioned, ad funded variety) remains a download business, while consumers migrate to the easier more accessible (free tiered, ad funded) music streaming models.

We’re told that the ad-supported free tier is the only way to attract consumers from piracy to legality. To be clear we’re not opposed to free trial periods. Free trials of 30 days, maybe even 60 days should give the consumer the ability to fully experience the value a streaming service offers. We just don’t see how the economics of ad-supported free streaming can create a sustainable revenue model for musicians and songwriters.

But here’s the bigger question. What happens when the pirates migrate to streaming over storing? Now we’re back to square one. A decade ago iTunes and later Amazon provided an legal solution to piracy that was superior in every way except one, price.

Why would anyone think that streaming would combat piracy any better than transactional downloads? Well, for the same reason piracy is, was and remains the primary source of music consumption, price. So the conversation and controversy over streaming is not one about the method of distribution, or technology. The conversation is the same as it has been for a over a decade, price.

Essentially Spotify appears to be designed to model ad-funded piracy whereby the company who can capture the largest market share would have ability to legally devalue music by delivering it to consumers for free. This math just doesn’t work. We can’t even see where the math on paid subscriptions will ever get to scale or revenue at a price point of $9.99 a month per subscriber.

So the inevitable question becomes if streaming is the solution to piracy, what happens when piracy is streaming? There are already multiple applications that are available or in development that reportedly enable users to stream music directly from BitTorrent as opposed to the need to download files to a local hard drive.

So explain to us again exactly how streaming is a solution to essentially the same service? Oh, they both need to compete on the same price point, which is free. Well, guess what, ad-supported free distribution of music is not sustainable.

YouTube is the largest free ad-supported free streaming distribution platform and it can not create the type of revenue required for the sustainability of the recorded music business. If we believe what they say, YouTube isn’t even a profitable business for Google!

So here’s the bottom line. Spotify, YouTube, Pandora and other ad-supported free streaming services are a side show to take the conversation away from the core problem, piracy. Internet piracy is big business and these side shows distract the conversation away from the fundamental truth of our economic reality… Free doesn’t pay. It’s just common sense and it’s just math…

 

Spotify Doesn’t Kill Music Sales like Smoking Doesn’t Cause Cancer…

 

BUT SPOTIFY IS PAYING 70% OF GROSS TO ARTISTS, ISN’T THAT FAIR? NO, AND HERE’S WHY…

 

Apple Announces Itunes One Dollar Albums and Ten Cent Song Downloads | Sillycon Daily News

 

 

 

 

 

 

 

 

Zoë Keating Publishes Google/YouTube Transcript : Clarity | Zoë Keating Blog

With friends like these…

If i wanted to just let content ID keep doing it’s thing, and it does a great job at and i’m totally happy with it and i don’t want to participate in the music service, is that an option?

That’s unfortunately not an option.

Assuming i don’t want to, then what would occur?

So what would happen is, um, so in the worst case scenario, because we do understand there are cases where our partners don’t want to participate for various reasons, what we basically have to do is because the music terms are essentially like outdated, the content that you directly upload from accounts that you own under the content owner attached to the agreement, we’ll have to block that content. but anything that comes up that we’re able to scan and match through content ID we could just apply a track policy but the commercial terms no longer apply so there’s not going to be any revenue generated.

Wow that’s pretty harsh.

Yeah, it’s harsh and trust me, it is really difficult for me to have this conversation with all of my partners but we’re really, what we’re trying to do is basically create a new revenue stream on top of what exists on the platform today.

PLEASE READ THE ENTIRE POST/TRANSCRIPT AT:
http://zoekeating.tumblr.com/post/109312851929/clarity

Involuntarily Distribution Business Subsidies | East Bay Ray

One of the talking points that various tech company commentators, academics and bloggers have used to try to justify companies exploiting an artist’s work without consent (a loophole in safe harbor) is that it would lessen the barrier for tech companies to start up. The idea is that creators should be required to give something up to facilitate this goal. Business start-ups are all well and good, but to require anyone to involuntarily subsidize a business, internet or otherwise, with something they have put time, effort, money, and skill into is extremely problematic.

Would these same people advocate that landlords and utility companies also give up income and the right of consent to help internet companies? That would also make it easier for them to start. But no one has suggested that.

It could be ruinous for creators to be required to be involuntarily involved in start-ups that may or not succeed, tying them to businesses that the artists has no way to vet to see if they even know how to distribute competently or honestly. If they are to survive, artists need to examine their licensees and distributors. I’ve seen many artist’s careers die prematurely from incompetent, greedy or dishonest businesses. (Compulsory licenses that are a last resort to negotiation, rather than the first resort to eliminate negotiation, is an alternative that has for decades shown itself to ensure artist’s sustainability.)

To put it into personal terms, I shouldn’t be forced, or any person for that matter, into being a lab rat for some click bait experiment. And then if the experiment is successful, none of the content creators share in any of the IPO rewards. A bit un-American I’d say and bad policy, it does not allocate rewards according to risk.

History has shown that exploitation of another person’s work with little compensation or without their consent to insure an enterprise’s survival is fraught with ethical and moral issues. If internet companies can not make money selling a product or service on merit and integrity, and treating the people that supply their “product” justly and with respect, something is not right. No matter how well intentioned by well meaning people, economic philosophies that ignore consent or fair compensation, rarely turn out good for society.

– – –
East Bay Ray is the guitarist, co-founder and one of two main songwriters for the band Dead Kennedys. He has been speaking out on issues facing independent artists—on National Public Radio, at Chico State University, and on panels for SXSW, Association of Independent Music Publishers, California Lawyers for the Arts, SF Music Tech conferences, Hastings Law School and Boalt Hall Law School. Ray has also met with members of the U.S. Congress in Washington, D.C. to advocate for artists’ rights.

Wondering Sound: “David Lowery Has Become Most Important Spokesperson for Artists Rights In Digital Era”

‘In the last three years, David Lowery has become perhaps most the important and ardent spokesperson for artist rights in the digital era. Who is he?’

Balanced, funny and in depth profile of fellow Trichordist writer David Lowery.  Must read.

READ THE FULL STORY AT WONDERING SOUND:
http://www.wonderingsound.com/feature/david-lowery-digital-music-cracker-interview/