Joke of the Week: Sen @RonWyden Claims He’s Pro Artist

Sen Rony Wyden has just posted a medium blog in which he makes the rather astonishing claim he is helping artists.

Let’s look at how Ron Wyden has tried to “help” artists in the past:

  • He sponsored the Orwellian-named “Internet Radio Fairness Act” that would have slashed artists pay from digital services.  In some cases would have slashed artist royalties 70%.  The bill never got out of committee as it was so obviously a give away to Google, Pandora, Spotify and other digital services.
  • Ron Wyden opposed anti-piracy protections in the SOPA bill. Most people don’t understand SOPA.  They fell for the “don’t break the internet” bumper sticker slogan rather than looked at the details of the bill. Since the SOPA act failed in 2012, many countries including the UK have enacted similar but much stronger anti-piracy provisions. None of the dire consequences predicted by Wyden and his google funded anti-copyright fellow travelers ever emerged. Wyden has never acknowledged he was demonstrably wrong on the SOPA provisions that would have helped artists.
  • Ron Wyden has consistently opposed all sensible and bipartisan reforms to the whac-a-mole DMCA takedown notice routine that companies like Google exploit. Whac-a-mole because they allow infringing files to repopulate their servers within minutes.  Basically Google makes hundreds of millions if not billions of dollars by exploiting this loophole.  (Remember Ron Wyden’s home state of Oregon hosts vast data centers for Google).
  • Although he will deny it, Ron Wyden tanked TPP because it’s intellectual property rights provisions didn’t weaken copyright sufficiently. There is no other reasonable conclusion.  Ron Wyden will say he opposed TPP because it would hurt American workers, but if you look at the timeline, Wyden was a proponent of TPP until Google didn’t get what they wanted on copyright. Under mock pressure from astroturf Fight For The Future (an anti-copyright group led by a Google lobbyist) Wyden changed his  position.
  • Ron Wyden opposes the Classics Act which would fix the Pre-1972 loophole which allows digital services and billionaire owners to avoid paying the royalties to performers that had the misfortune to record before Feb 15 1972. Unequal protection under the law.
  • On top of that the “progressive” Senator has not acknowledged what is a pretty ugly and obvious truth: the pre-1972 loophole disproportionately harms African American artists.  Sad artifact of history, but a disproportionate share of songs were developed and popularized by African-American artists but the biggest hits were performances by white artists. The pre-1972 loophole freezes these unfair biases in place. For instance: Percy Sledge’s Sea of Love doesn’t get royalties; but Michael Bolton’s Sea of Love does. How can anyone with a conscience live with this?
  • Ron Wyden just proposed a bill called ACCESS (clever right?) It is essentially the Classics Act but it is laden with loopholes that would allow services like Google and likely even The Pirate Bay, to continue to exploit artists without pay. One clause requires the rights holder to notify the service they are infringing (like they don’t already know), and then allows the service 180 days to correct their behavior.  6 months of royalty free use?  WTF?  There are also impossible to fulfill recordation and notification requirements that create holes that again would disproportionately harm African American artists because they were more likely to record on small specialty labels without the legal and economic resources that the major labels enjoyed. There is a reason international treaties on copyright discourage registration formalities.  Onerous formalities (like Wyden’s) end up disenfranchising independent and less sophisticated artists. Do you think those are white kids in the suburbs of Portland?

But even all this doesn’t really give you a sense of the deceit Wyden is willing to engage in to protect companies that have data centers in his state.

So let’s take a closer look at his blog post   “A Better Way to Protect Artists”

The deceit starts with Wyden not explaining to the reader that all the protections he supposedly provides in his bill (ACCESS) are also in the Classics Act which he opposes.

“For absolutely every living artist who recorded before 1972, my bill would give you new rights and new revenue from digital streaming, while also creating a uniform copyright law across the whole country.”

This is what the Classics does.  What Wyden is not telling you is that he has basically cloned the bill and inserted  a  billion dollars worth of loopholes into the act. ACCESS to legacy artists wallets is more like it.

But Wyden continues.  Next he makes the spurious claim that the genuinely pro-artist Classics Act somehow “locks away” ideas.

Artists deserve to be compensated for their work, but at the same time, we shouldn’t lock up ideas for decades after the creator has passed away.

This is the #1 bogus argument that every anti-copyright dead ender makes. Seriously Senator, if there is one question you need to answer, this is it: How does paying artists for a stream of their performance lock away that work?  Huh?  We are waiting. I guarantee you that Wyden won’t answer because nothing is “locked up.”  As a general rule when ANYONE in politics says they are doing something to  “benefit the public” it almost always turns out that “the public” is a large corporation in their district. Quite progressive right.  Really looking out for the little guy there.

The second obfuscation the Senator engages in,is the notion that copyright protects ideas. I only bring this up because Wyden is extremely educated on this matter and he has to know he is engaging in a deception on this point. Copyright does not protect ideas. Copyright only protects unique expression. Huge difference. There are hundreds of court cases and hundreds of years of academic literature that clearly lay this out. Shameless demogoguery designed to whip up hysteria never goes out of fashion.

Wyden continues:

“That’s why researchers like the Library Copyright Alliance (which includes the American Library Association), the Internet Archive and the Society of American Archivists all have endorsed my ACCESS to Recordings Act.”

All of these orgs are Google funded or rely on Jonathan Band for policy positions.  Jonathan Band of course is one of the star academics in Google Academics Inc report. So, a bunch of orgs that effectively act as proxies for Google support your bill.  Oh and Google just happens to have large tax exempt data centers in Oregon sucking down cheap electricity subsidized by ordinary Oregon ratepayers. Nothing funny going on here. The Senator might also want to note that the Internet Archive thinks they have some duty to distribute copies of Dabiq the official ISIS propaganda magazine. Brewster Kahle and his fellow Internet maximalist ideologues at Internet Archive are the worst kind of pseudo-intellectual bubble dwellers. They don’t give a fuck what kind of mayhem results from their irresponsible actions.  (I’m from San Bernardino County I’d be glad to introduce the Senator to some people…) That’s a real winning coalition  Next time maybe the Senator can get slightly more sympathetic astro turfers to support his bill. See if big tobacco has any.

But it doesn’t end there.  Wyden continues with his corporatist oligarch friendly propaganda.

Wyden repeats the widely debunked claim that proposed Classics Act creates a 144 year copyright for sound recordings in 1923 that are covered by state copyright law. The 144 year copyright term, which applies to a very narrow class of sound recordings was created by the 1995 copyright legislation.  It has nothing to do with the Classics Act.  That ship has sailed long ago. Here Wyden seems to be engaging in The Big Lie tactic.  Repeat a false claim until people think it’s true.  And this is a sitting US Senator. Tellingly this line of attack was first trotted April 26th by Mark A. Lemley who was (is?) outside counsel for Google.

Rent-A-Senator™ Wyden?

Here are some more howlers:

“To be clear, I support one of the goals of CLASSICS, and the reason it is supported by artists — to open up the revenue from new digital streaming services to older artists. Due to pending litigation, or the threat of litigation, virtually all streaming services are making payments to the copyright owners — often record labels. But, without the safeguards in federal law, we don’t know whether or how distributions are being made to the artists.”

First.  Does Wyden really think it’s a good thing that artists had to sue to get their money?  It’s not like most artists have a couple hundred thousand dollars sitting around to file a federal lawsuit against Google or Sirius.  Does he think they do?   Wyden is such a corporate whore now he doesn’t even know when he’s saying completely tin eared shit like this. Dude get out of the bubble once in a while.

Second.  Most artists have not received their money because the digital services are still appealing the class action.  They won’t get their money for years. I expect that hundred of artists will pass away before the money is ever paid.

Third. This:

But, without the safeguards in federal law, we don’t know whether or how distributions are being made to the artists.

WTF? This is exactly what the Classics Act does.  Safeguards to ensure the artists are paid directly via SoundExchange.  You get it? He is opposing a bill that does exactly this.  It’s total bullshit. He is simply trying to hide the fact his ACCESS  Act simply inserts a bunch of safe harbors and loopholes into the Classics Act.  And these are loopholes that will absolutely save digital services hundreds of millions if not billions of dollars; will result in artists being paid less; and these artists will be disproportionately African American.

Wyden is absolutely not a friend of artists.  The record is clear.

Let’s Not Miss An Opportunity to Include Startups in the Music Modernization Act–MusicTechSolutions

By Chris Castle
(musictech.solutions)

Who took on the Standard Oil men
And whipped their ass
Just like he promised he’d do?
Ain’t no Standard Oil men gonna run this state
Gonna be run by folks like me and you

Kingfish, written by Randy Newman

If you’re one of the small group that has actually read the Music Modernization Act, I think you’d have to come away with the idea that this is legislation by the big boys for the big boys.  Nowhere is this unfortunate flaw more apparent than in the way that digital media companies “modernize” the way they treat themselves.  No wonder Digital Media Association (Amazon, Apple, Google, Pandora, Spotify) and the Internet Association (Amazon, Facebook, Google, Pandora, Spotify) love it so much–it’s just the same old story from Standard Oil or United Fruit.

But is MMA really intended for the biggest corporations in commercial history playing footsie or should we believe the sales pitch that it is intended for the innovative startups and new entrants?

It is not surprising that startups were apparently excluded from the legislative process that created MMA and are themselves silent–or silenced–observers.  Given that Google, Amazon, Apple and Spotify are on the other side, startups know which side butters their bread and what will happen if they voice any criticisms.  Like the python in the chandelier, nothing really need be said; startups know what happens if they challenge the big boys, particularly Google and Amazon who probably host their companies, serve their advertising or drive traffic to them.

The MMA permits these massive and aggressive incumbents to ultimately decide how much startups pay for access to the blanket license that we are told by DiMA’s CEO will unleash innovation and “fuel the next wave of creativity“.  Yet–if startups can’t afford to buy in to the license, it won’t do them much good, and as drafted the MMA allows their incumbent competitors to decide how much that buy-in will cost any startups or other of the much ballyhooed new entrants.  This all before a startup has to pay royalties to the collective–and in addition to any royalties.

How can this be fair?  It’s easy when your lobbyists write the rules.

The Congress delegates the government’s authority under the Music Modernization Act by creating two main bodies around the new government-mandated blanket license:  The “mechanical licensing collective” which is to represent those with songs to be licensed and the “digital licensee coordinator” which is to represent music users wishing to license those songs under the new blanket mechanical license.  Music users will answer to the “digital licensee coordinator,” presumably under some membership agreement yet to be drafted.

Both these bodies are supposedly approved by the Register of Copyrights (the head of the U.S. Copyright Office), but the Register has the unenviable position of being constrained to appoint certain types of entities or people by statutory criteria in the MMA.

One of those criteria is very majoritarian, if not downright oligopolistic–and I would suggest that for both the collective and the digital licensee coordinator the math alone limits the Register’s choice to one entity.  Here’s the relevant language for how the Register selects the collective:

“[The Register must choose an entity that] is endorsed by and enjoys substantial support from copyright owners of musical works that together represent the greatest share of the licensor market for uses of such works in covered activities, as measured over the preceding 3 full calendar years;”

And here’s the mirror version of the relevant language for how the Register selects the “digital licensee coordinator” (or “DLC”):

“[The Register must choose an entity that] is endorsed by and enjoys substantial support from digital music providers and significant nonblanket licensees that together represent the greatest share of the licensee market for uses of musical works in covered activities, as measured over the preceding 3 full calendar years”

So one thing seems true for both the collective and the coordinator:  They can only be entities enjoying “substantial support” by at least a plurality if not a majority of their respective markets on either side of the same coin.  I’m not quite sure how that definition presents a choice to the Register–more like it allows the biggest players to dictate the Register’s choice.  (How can there be two pluralities much less two or more?)

I would submit that this structure is a long-term recipe for disaster.

Others have and are writing about the conflict-ridden aspects of the collective, so I will focus here on the digital licensee coordinator which is equally, if not more, conflict-ridden than the collective.

By definition then, startups–who are potential music users most in need of the blanket license without having to pay minimum guarantees–are evidently excluded from any possibility of becoming the digital licensee coordinator.  The Congress effectively prohibits the Register from appointing one of them as the DLC, even if they were brave enough to raise their hand (see Yelp in the EU antitrust ruling against Google).

And don’t forget a main selling point of the MMA:  The music users (i.e., the “licensees”) pay an “administrative assessment” to cover the costs of running the mechanical licensing collective.  (An inherent conflict?)  The MMA authorizes the DLC to “equitably allocate the collective total costs across digital music providers…but shall include as a component a minimum fee for all digital music providers.”  (Although note that the assessment as a whole and perhaps the allocation ultimately has to be approved by the Copyright Royalty Judges–and good luck to startups being able to afford to appeal to the CRJs or a higher court.)

Plus the MMA authorizes the DLC to “[e]ngage in efforts to enforce notice and payment obligations with respect to the administrative assessment….”  AND the DLC also gets to set the “dues” payment for each “member.”

So if a startup wants the blanket licence, they have to pay a share of the assessment apparently determined by a representative of their biggest competitors PLUS a membership fee.  And then they get to pay royalties to the collective.  Note that this is a radical departure from the current law and adds another gatekeeper in between songwriters and their money.

If a startup fails to make all these payments, they can lose the blanket license even if they have paid all royalties on time.  No one can tell you what the minimum fee will be or the startup’s share of the assessment.  In fact, as new startups will likely enter the allocation for “membership” all the time, a real time percentage allocation for each “member” of the DLC will likely change pretty much constantly.  Plus the collective can enforce the blanket license royalties and the DLC can enforce the assessment payments and membership “dues” (aka rents).

“Modernization” legislation is an excellent opportunity to level the playing field for these companies that are no doubt afraid to challenge the incumbents like Google (known for being specially vindictive to any startup that challenges them–see Foundem and the European Union’s multi-billion euro antitrust litigation against Google).

It’s also important to realize that there is an exponential difference between the group of companies that the Register takes instruction from on the MLC compared to the group instructing the Register for the DLC.  Candidates for the DLC include Amazon, Apple, Google and Spotify–three of the biggest companies in commercial history plus the streaming platform that is easily the dominant actor in its relevant market both in the U.S. and many other countries.  This basically assures that no startup will ever be included as the DLC absent a government-mandated rotation.

The Music Modernization Act is a great opportunity to do something positive for the market rather than continue to reenforce the most dominant incumbents in history (see 60 Minutes, “The Power of Google“).  After all, it was their own carelessness and “permissionless innovation” that got us to this point.

Here’s some free advice to Congress:  Go wild.  Require appointing a startup or two or three as the DLC from time to time.  And since you’re dictating many attributes of the MLC’s board, if you really want to go truly off the reservation, require one of those startups to be from some place like Austin, Athens, Northern Virginia or Salt Lake–anywhere but Silicon Valley.  Wouldn’t that be real modernization rather than real entrenchment?

As a wise old Member of the Texas Congressional delegation once told me, they get to climb the ladder to the American Dream like everyone else.  What they don’t get to do is pull the ladder up behind them once they get to the top.

By limiting the choices of who can be the DLC, the government is mandating control to only the biggest of the big.  And giving them an antitrust exemption as the cherry at the top of the ladder.

 

Jonathan Taplin @ Forum on Internet Governance June 21st Washington DC

Jonathan Taplin will keynote the inaugural Forum On Internet Governance

The Forum on Internet Governance
June 21, 2018
Landmark E Street Cinema
555 11th Street N.W. Washington, D.C. 20004

From our friend Will Buckley Founder / Executive Director, FarePlay, Inc.

The Forum on Internet Governance is in response to the mounting call for internet reform from policy makers and the media. The Forum will explore the socio-economic challenges created when powerful internet companies are allowed to self-regulate.
After a long public love affair with the internet, things changed last fall as reports began to surface about Russian interference and false advertising during the presidential election. Washington was finally being forced to turn their attention to those internet companies who have been derelict in taking responsibility for what has been taking place on their platforms.

It came as no surprise when internet powerhouses Google, Facebook and Twitter were easily invaded by Russian hackers. After all, for decades they have been fighting off all attempts by legislators to put controls in place to address criminal and abusive activity on their platforms.

Now, with recent revelations about Facebook and Cambridge Analytica and legislative hearings with CEO Mark Zuckerberg, the discussion about the need for internet governance has come sharply into focus.
The Forum is a half day event (8:30 AM to 12:30 PM) bringing together a diverse group of thought leaders and experts to discuss their concerns about the most pressing problems on the internet and to make recommendations for addressing those problems.

Sessions will include discussions on privacy, transparency, user safety, fake news, safe harbor abuse, the lack of ethical practices, and other areas of public concern.
Jonathan Taplin, author of Move Fast and Break Things: How Facebook, Google and Amazon Have Cornered Culture and Undermined Democracy will be the keynote speaker.

–William Buckley Jr.

Tix here:

https://www.eventbrite.com/e/the-forum-on-internet-governance-tickets-5881468631

Agenda
 8.30 – 9.00 AM
Registration / Continental Breakfast

9:05- 9:35AM
Session 1: Keynote speech
Title: Is the internet breaking the creative eco-system?
Description: In his latest book, ‘Move Fast & Break Things – How Facebook, Google, and Amazon Cornered Culture and Undermined Democracy’, film producer and academic, Jonathan Taplin, documents the monopolization of the Internet by Google, Facebook and Amazon, and proposes a new future for musicians, journalists, authors and filmmakers in the digital age.
Speaker: Jonathan Taplin

9:45 AM – 10:45 AM Session 2
Panel Discussion Title: Whose Safe Harbor?
Description:
Safe harbors were meant to provide a balance between access to content and the liability of internet platforms. Yet, in the US, like in Europe, or Australia, safe harbors have essentially allowed digital service providers to build massive businesses with little accountability about the content that they provide access to. So who are these safe harbors really protecting? How can a better balance be achieved between the normal aspiration to access content and the rights of content providers? What are the key points for safe harbor reform?
This session will feature representatives from the creative sector who will discuss the impact of the safe harbor regime on their businesses and what’s needed to achieve better copyright protection in the digital eco-system.

11:00 AM – 12:00 PM
Session 3: Panel Discussion
Title: The call for Internet Governance
Description:
A couple of decades ago, the digital promise was to bring additional freedom and new ways to apprehend the world through connectivity and new tools. But have these promises been kept? What kind of environment did the digital revolution foster for mankind in general and the creative community specifically? Should the internet be more regulated? Academics and creative industry experts debate on the ethics of this brave new world.
Panelists will discuss what needs to happen to ensure the internet is a safe environment for users while providing a level economic playing field for non-internet companies and creatives.
Topics will include: Privacy, Fake News,Terrorism and Safe Harbor abuse and the role played by Google, Facebook, Amazon and other major internet platforms.

> 12:05 PM – 12:25 PM Closing 

On Classics Act Sen Wyden Taps Into Portland’s Peculiar Anti-Union Rich Man’s Progressivism


Sen Ron Wyden shown here when he was the trombone player for”The Shyllz” an early 80’s Palo Alto new wave band. 

A few months ago I came across an article on Portland, Oregon’s mixed history with labor unions despite it long being a bastion of progressivism. Andrew Bulkeley writing in Oregon Business in 2017:

“But even as social responsibility goes mainstream, organized labor remains an outlier among many [Oregon] companies that self-identify as progressive enterprises. To be sure, unions have something of a foothold in government and legacy industries — the grocers QFC and Kroger, manufacturers like Vigor Industrial and Daimler Trucks North America. Among many young companies and new business models, however, the union presence is tenuous at best.”

Portland’s Nike has long had its union problems. But it’s vague commitments to diversity and support of milquetoast social issues hardly make it a bastion of progressivism and is thus not the perfect case study.

Perhaps the more illustrative story of progressive Portland’s anti-unionism concerns the city’s beloved Powells Books.  In the 1990s the book shop management and progressive democratic owner Michael Powell fought a decade long battle against its employees efforts (and right) to unionize.  Even today Sontz the CEO of Powells Books still seems bothered by the fact her employees are unionized. In the same article in Oregon Business she says:

“[A union] slows you down,” Sontz says. “It makes you less entrepreneurial.”

Unions also tend to give workers a living wage so they can say support a family. Or own a home. Something increasingly difficult in Portland. Workers could easily argue that Powells books could be “more entrepreneurial” by paying its CEO less.  Use that money to invest in new technology. Ah ,but it’s always been so much easier to blame those pesky union workers for the company’s woes. Union bashing is usually the “look like you’re doing something” strategy when you don’t actually have a management strategy.

Sen Ron Wyden seems to be following in this peculiar Portland tradition.  He seems to have issues with pre-1972 performers (music workers) and the American Federation of Musicians and whether digital services (the bosses) have to pay them at all. And yes you read that right.

Specifically, Sen Ron Wyden is trying to sink a bill (The Classics Act) that is designed to plug a loophole in the interaction between state and federal copyright law that allows big companies like Google, Spotify, and Sirius to avoid paying royalties to performers and union side musicians that had the misfortune to record before Feb 15 1972. This is particularly galling because his opposition to the act would seem to benefit one company more than any other:  Sirius XM.

Sirius XM market cap is currently more than 30 plus billion dollars and last reported net profits running at 22% of revenue. This is a company with no other satellite radio competitors. It relies almost exclusively on licenses imposed on music rights holders by the federal government.  And the regulations that govern the setting of royalties actually mandates below market rates. Its net profit margins are quite extraordinary when you consider it is stagnant business.  Rent seeking and crony capitalism, two great tastes that taste great together!

And this is not Wyden’s first rodeo. He can’t be forgiven for not understanding the issues.  It is a pattern. This is his second attempt to cut pay to performers in a way that benefits digital services. The second time in less than a decade! In 2012 he proposed the Orwellian named Internet Radio Fairness act which would have slashed pay to performers up to 70%.   We’re not talking a minor adjustment to federally mandated rates.

But it doesn’t end there. Protecting the billionaires that own these digital companies is so important to Wyden, he has just introduced a kind of “poison pill” bill (ACCESS Act) that seems specifically designed to gut the CLASSICS legislation (Contrary to what Wyden claims It reduces existing copyright terms on many songs originally protected by state copyright laws).

I often wonder what it is Wyden has against musicians? Is it like that old SNL skit which “reveals” biographer Albert Goldman’s hatred of John Lennon and Elvis stems from the fact he’d once been The Beatles trombone player. (Spoiler Alert) Elvis came to a Beatles show and convinced John Lennon to fire him.

Finally referring to an organized multi-company effort to set performer prices at zero as a “loophole” is very generous to Wyden. It more like price fixing. (Where is that FTC investigation?)  Further there was no loophole in copyright law until Sirius and Pandora decided to stop paying the royalty in 2012.  They have litigated and appealed ever since to keep the loophole open. More ethical (and better run) companies like Apple continue to pay this royalty. I assume because like most reasonable people, they look at the law and see that congress never intended there be a “gotcha” loophole. It’s more likely Sirius and Pandora will lose their cases eventually.  So Wyden is not just for preserving a loophole, he’s trying to protect companies that are likely breaking the law, and screwing unions at the same time.

Now that’s a very peculiar kind of “progressivism” isn’t it? Welcome to Portland.

P.S. BTW does anyone know if all those Silicon Valley data centers out in The Dalles hire union workers?  Cause usually Silicon Valley is quite anti-union.  But boy do they love Ron Wyden! 

Goliath Never Learns: Watch Out for Music Choice Duping Artists for Music Modernization Act in Senate — Music Technology Policy

Remember when Blake Morgan called out Tim Westergren for sending emails to artists trying to get them to write their Member of Congress to support the Internet Radio Fairness Act (IRFA) and lower royalties for Pandora?  “Million-a-month” Tim really stepped in it that time because he didn’t expect the artists to figure out he was both pushing a deceptive deal on them and treating them like they were idiots. And that started the #irespectmusic campaign.

patrick stewart

So now there’s yet another email campaign targeting artists to act against their own interest.  This time it’s about preserving a subsidy for Music Choice’s cable music service.  If you still have cable, you’ll probably find Music Choice in the highest numbered channels.

Here’s how the subsidy works–which you should know because it’s paid with your money.  Music Choice (like Pandora) gets to take advantage of the statutory license created by the Congress in 1998 for the use of your recordings in “noninteractive” digital services.  This statutory license is a huge benefit for everyone who uses it as they can avoid individual negotiations, get streamlined royalty accounting to SoundExchange and never have to pay–clutching pearls–artist advances.

Because the license is statutory, the government also has to set the royalty rate you get through a process now conducted by the Copyright Royalty Judges.  The CRJs are supposed to set a market rate based on economic analysis and the services using the statutory license pay those rates.

But–some services are more equal than others.  Back in 1998, the Congress was trying to encourage investment in a new market for digital music services and so certain named services were given special treatment by the government to protect them from what’s called the “willing buyer/willing seller” standard that more closely tracks market rates.  This special treatment was to give certain services that were already up and running in 1998 a break on royalty rates–your royalty rates–through what is effectively a government subsidy that you finance.  This was because these “preexisting services” had started their businesses in reliance on the subsidized rates–and guess what, they kind of got to liking that subsidy.

Three of those preexisting services still exist today:  SiriusXM, Musak and Music Choice.  All three of these companies have enjoyed the break you gave them on your royalty rates for 20 years.  However–the reason to give them that break has long passed.

MTP readers will remember this issue came up with IRFA in 2012.  As we noted then, SiriusXM’s then-CEO Mel Karmazin told CNBC’s Jim Cramer in an interview about the merger of Sirius and XM Radio, both of which got the same subsidy as Music Choice:

Free cash flow is what enables you to buy back your stock, make acquisitions, pay down debt. And I believe free cash flow is an important metric. Our free cash flow now, is growing– it’s extraordinary. Before the merger we had negative free cash flow of $500 million. Negative free cash flow. This year we will have $700 million of free cash flow. We haven’t given guidance for next year. Analysts have us at a billion of free cash flow and continuing to grow. So it’s a great start.

The Music Modernization Act would switch these three subsidized services onto the same royalty rate as the thousands of other services that somehow seem to get by with the unsubsidized “willing buyer/willing seller” rates.  And Music Choice is leading the charge to keep that subsidy that you’re giving them, Musak and SiriusXM.  Presumably this is because Music Choice is more sympathetic than the cash-rich goliath SiriusXM.

To the point—Music Choice is evidently sending out an email to some artists (possibly through intermediaries like distributors) to lobby the Senate Judiciary Committee to preserve the Music Choice subsidy.  Why?  The Music Choice letter they want you to sign tells you:

Many of us have had our careers explode because of the exposure we got first on Music Choice which is critically important to the artist community.

Really.  That’s news to me.

And then there’s this:

Being played on just one Music Choice channel is like being played on every radio station in the country serving a particular music format.

No it’s actually nothing like that.

And here’s my personal favorite:

None of the streaming services provide anywhere near the level of promotion and support that we have received from Music Choice.

Exposure bucks, baby.  It’s so 1999–back to the future with Music Choice.  Where’s that flux capacitor when you need it?

Exposure Bucks

Preserving Music Choice’s subsidy would be a material change in the bill that might be enough to derail the coalition that backed it in the House and that was clearly influential on the Senate Judiciary Committee in the recent hearing.  Remember–the Senate version of the Music Modernization Act has to pass the Senate before it becomes law.  It also has to pass in essentially the same form as the House version which already passed the House unanimously.  Continuing the subsidy to these three services is a material change to the bill that could cause the whole bill to fail.  

Which, of course, would be just fine with Music Choice, SiriusXM and Musak because that would also preserve their subsidy.

So heads up–they’re running the old IRFA play all over again.  Don’t get duped.

But don’t let that stop you from supporting the Kickstarter campaign to buy a DeLorean DMC-12 for Music Choice so they can get back to the future in the style to which they have become accustomed.

Emails Suggest Long Time Google Advocate Behind “Gang of 40” IP Profs Letter Against Classics

The 9th Circuit was effectively told by Google counsel they were engaging in conspiracy theories. Then they were forced to produce documents by the court. Turned out court was right. #ConspiracyFacts

On the morning of April 25 less than 24 hours after the Music Modernization Act passed the House 415-0. Mark Lemley a professor at Stanford wrote the following letter to a group of IP Lawyers:

“I think this term extension is unnecessary. I am thinking of putting together a short professors letter arguing that if Congress is to create a sound recording digital public performance right, it should expire when a corresponding copyright would naturally have expired and should be subject to the same limitations and defenses as copyright law. If you are interested in helping put together such a letter, please let me know. Time is short. If you think I am misreading this for some reason, I’d like to know that too.”[1]

This is significant for two reasons. This email appears to be the basis of the “Gang of 40” IP professors letter in opposition to the Classics Act.  Opponents of the Classics Act (mostly Google funded EFF and Public Knowledge) have used this letter to try to block or gut the legislation, by shopping the debunked claim of copyright term extension to Senate staff.

Second according to the a court document commonly referred to in press as a “shill list” (Oracle v Google) Lemley has acted (continues to act?) as outside counsel for Google. He is a long time advocate for Google’s policy positions.  He also features prominently in the “Google Academics Inc”, report published by Google Transparency Project.  This report details Google’s funding for academic institutions and research, and notes how it appears to have predictable results on the research conclusions produced by academics. That is, the research conclusions generally support Google’s public policy positions. Some have criticized the inclusion of certain professors in this report, but Lemley’s inclusion appears uncontroversial. Lemley unlike many other professors does not seek to hide his connections to Google.

To be clear, Lemley is doing nothing illegal or unethical.  However if you put the Gang of 40 letter in the context of the greater public policy debate around The Classics Act this letter is extremely problematic for Google. For this letter appears when Google, through its trade policy group DiMA, was telling congress that they were negotiating in good faith with performers, songwriters and other rights holders. They held (and still hold) a public position in support of The Classics Act. Yet the letter appears to have been produced by Google outside counsel.  This would seem to imply negotiators for DiMA were unwittingly being undermined by their own side, or (more likely IMHO) negotiators were in on it and are continuing to play a double game.  That is not acting in bad faith, it is acting in terrible-fuck-you-extra-googley-bad-faith.  For a second time.

Senate Staff should look into this.

[1]This email was provided by multiple sources.  Further the published excerpt was verified by yet another recipient of the email.

Law Professor Opposing Classics Act Engages in some “SLAPP Stick” With Lowery

40 IP Law Professors wrote a letter to the US Senate opposing The Classics Act. Most of the claims in the letter have been previously debunked by Terry Hart here.   Google funded astroturf Public Knowledge has distributed the letter. This raised some eyebrows. Lowery was trying to get at least one of the 40 Law Professors to reveal who actually authored the letter.  Lowery was repeatedly stonewalled.  One of the signers Law Prof Aaron Perzanowski seemed to threaten Lowery with a defamation suit, for previously noting that Prof Perzanowski appears in the Google Academics Inc report.  Perzanowski (a lawyer) was clearly attempting to dissuade Lowery from pursuing this line of questioning.

From Wikipedia:

A strategic lawsuit against public participation (SLAPP) is a lawsuit that is intended to censor, intimidate, and silence critics by burdening them with the cost of a legal defense until they abandon their criticism or opposition.[1] Such lawsuits have been made illegal in many jurisdictions on the grounds that they impede freedom of speech.

BTW Lowery eventually found other sources that report the letter was proposed and organized by Google outside counsel Mark Lemley and Stanford Prof Phillip Malone.  It’s still not clear who wrote the text.

This isn’t some petty twitter dust up. There is an important public policy concern, because the U.S Senate was presented the letter as if it was a spontaneously organized letter by a group of independent IP Law Professors. The story seems to be much more complex.  If Google did have a hand writing this letter, or encouraging it, Senate staff should be advised.

 

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15 of the 40 IP Law Professors Opposing Classics Act Likely Benefitted from Google Funding

Public Knowledge is a well known Google astroturf group. They were also listed in a court document often referred to as “the Google Shill list”. Public Knowledge organized and submitted a letter to the US. Senate urging rejection of copyright reform language that would close the pre-1972 sound recording loophole that allows a small handful of companies to avoid paying royalties to pre-1972 performers. The loophole – if it is a loophole at all- came to public attention in 2012 when a handful of digital broadcaster simultaneously stopped paying royalties older performers (Apple and other “good” tech companies still pay this royalty). The loophole has subsequently been challenged in court. The US congress noting the arbitrariness of the pre-1972 distinction has proposed language to close this loophole.  To bolster their case against the closure of the loophole, Public Knowledge has manufactured an argument that claims a return to the status quo is somehow a copyright term extension. PK then they managed to somehow get their letter  signed by “40 IP law professors.”  That’s right 40 academics have decided to help a handful of tech billionaires to continue to stiff pre-1972 artists. Sadly this type thing has become all too common in academia.

We would like to note that 15 of these professors appear to have benefitted from or continue to benefit from  Google funding.

To be clear.  We are not saying they were all paid directly. But as money is fungible, significant funding from Google to their institution, center or non-profit likely helped support their work and contributed significantly to their academic career.

9 of these professors are named in the Academics Inc report by Google Transparency Project.

6 others work/worked for institutions that are/were significantly funded by Google. And I don’t mean a few dollars here and there. We are talking hundreds of thousands if not millions of dollars.

Let’s face it. Opposition to the Classics Act is being coordinated by Public Knowledge and a small group of professors that mostly have Google in common. Someone should ask why is that?  If Google won’t comment ask Michael Beckerman at the Internet Association. I bet he knows.

Here are the 16 professors.

Michael Carrier Rutgers Law School

Michael W. Carroll
American University Washington College of Law

Paul J. Heald
University of Illinois College of Law

Mark A. Lemley Stanford Law School

Mark McKenna
Notre Dame Law School

Aaron Perzanowski
Case Western Reserve University School of Law

Matthew Sag
Loyola University Chicago School of Law

Pamela Samuelson
UC Berkeley School of Law

Jason Schultz
New York University School of Law

Lawrence Lessig
Harvard Law School
(Vast sums donated by Google to associated foundations and non-profits)

Jessica Silbey
Northeastern University School of Law
(Berkman affiliated faculty, Berkman receives Google Funding,)

Rebecca Tushnet
Harvard Law School
(Berkman, Berkman receives Google Funding,)

Eric Goldman
Santa Clara University School of Law
(Santa Clara University School of Law received Google Buzz cy pres for Ethics Center )

Brian Love
Santa Clara University School of Law
(Santa Clara University School of Law received Google Buzz cy pres for Ethics Center )

Tyler T. Ochoa
Santa Clara University School of Law
(Santa Clara University School of Law received Google Buzz cy pres for Ethics Center )

40 Law Professors Stop Suckling at Federal Teat to Write Senate Letter Urging No Pay for Artists

Classics_Act_IP_Professors_Letter_5.14.18

This has gotten completely out of hand. Here is another letter using the same arguments against The Classics act that Terry Hart previously debunked.

http://www.copyhype.com/2018/05/no-the-classics-act-is-not-a-term-extension/

This makes my blood boil because many of these folks are paid (federally subsidized) salaries of over a quarter million dollars a year. To do what? Sit around and teach maybe a class or two every other semester.  Moan about how it’s so fucking unfair that the billionaire owners of various digital services might actually have start paying royalties to pre-1972 artists again cause their little crony capitalist loophole might get closed. Poor babies.

Remember when professors weren’t regressive crony capitalist ass lickers?

Here are the professors that want to keep the pre-1972 royalty loophole open.
Many of their salaries are publicly available. If you want to make your blood boil look em up.

Melissa B. Alexander
University of Wyoming College of Law

John R. Allison
McCombs School of Business at The University of Texas at Austin

BJ Ard
University of Arizona James E. Rogers College of Law

Derek E. Bambauer
University of Arizona James E. Rogers College of Law

Mark Bartholomew
University at Buffalo School of Law

Robert Brauneis
George Washington University Law School

Michael Carrier Rutgers Law School

Michael W. Carroll
American University Washington College of Law

Ralph D. Clifford
University of Massachusetts School of Law

Thomas Cotter
University of Minnesota Law School

Brian Frye
University of Kentucky College of Law

Kristelia A. Garcia
Colorado University Law School

Shubha Ghosh
Syracuse University College of Law

Jim Gibson
University of Richmond School of Law

Eric Goldman
Santa Clara University School of Law

Paul J. Heald
University of Illinois College of Law

Stacey Lantagne
The University of Mississippi School of Law

Mark A. Lemley Stanford Law School

Lawrence Lessig Harvard Law School

David Levine
Elon University School of Law

Yvette J. Liebesman
Saint Louis University School of Law

Jessica Litman
University of Michigan Law School

Lydia P. Loren
Lewis & Clark Law School

Brian Love
Santa Clara University School of Law

Glynn Lunney
Texas A&M University School of Law

Mark McKenna
Notre Dame Law School

Mike Mireles
University of the Pacific, McGeorge School of Law

Ira S. Nathenson
St. Thomas University School of Law

Tyler T. Ochoa
Santa Clara University School of Law

Aaron Perzanowski
Case Western Reserve University School of Law

Jorge Roig
Touro Law Center

Matthew Sag
Loyola University Chicago School of Law

Zahr Said
University of Washington School of Law

Pamela Samuelson
UC Berkeley School of Law

Sharon Sandeen
Mitchell Hamline School of Law

Jason Schultz
New York University School of Law

Lea B. Shaver
Indiana University McKinney School of Law

Jessica Silbey
Northeastern University School of Law

Kevin L. Smith
University of Kansas School of Law

Katherine J. Strandburg
New York University School of Law

Rebecca Tushnet Harvard Law School

Alfred C. Yen
Boston College Law School

 

 

Lessig is so Wrong on Classics Act He Should Retire

After yesterday’s epic piece on Lessig, I’m surprised to find myself blogging about him today. But the self described “copyright expert” clearly doesn’t understand copyright and the compulsory licenses so here I am again.  In a piece published in Wired magazine we find Lessig fear mongering about the proposed Classics Act:

Archives with recordings of music from the 1930s or 1940s would now have to clear permission before streaming their music content even if the underlying work was in the public domain.  Yet there is no registry anywhere.

Actually no. For non-interactive streaming there exists a compulsory blanket license for post 1972 sound recordings.  Non-interactive streaming services essentially notify the copyright office that they are going into the non-interactive streaming business and pay royalties through the federally established SoundExchange.  SoundExchange has a database it maintains.  ONCE CLASSICS passes user pre-1972 will be brought under this post 1972 compulsory licensing scheme.

Currently because pre-1972 recordings are in most cases protected by state copyright and state common law.  Federal copyright rules do not apply.  The compulsory blanket license for post -1972 recording is not available. Without the CLASSICS ACT a streaming service currently must go state by state and song by song to obtain a license.  And currently in some cases state copyright is perpetual, something that Lessig should really hate.

Lessig has the whole thing backwards. The Classics Act addresses and fixes the things he is complaining about.

Did he not bother to read the act?

There is so much more he doesn’t understand or incorrectly asserts in this article. Most of it seems to be the result of him not understanding that pre-1972 works are covered by a patchwork of State and common law. Harmonizing the rules under a single federal statute is actually a good thing for his beloved archives. You got to wonder if he just looked at someone’s twitter feed to get his “facts” about the Classics then wrote an article in Wired.

So sad.  The guy needs to retire.