Month: March 2023

@musicbizworld: Spotify’s Mission Statement is Preposterous. Its latest announcements prove it.

[Chris sez: It is not enough for a Silicon Valley company to have a good idea or a compelling product or service. No, no–like Elizabeth Holmes the convicted felon, or Google, who probably should be convicted felons, these people have to convince themselves that they are saving the world. Literally. This is true no matter how ordinary their accomplishments. 

Like the self-hypnotist, they convince themselves that their powers of commerce are transcendent and otherworldly. History begins with them. Never should their revelatory accomplishments be compared to building a better mousetrap.

Spotify is no different, and they will damn well prove that their mission statement has no less than the predictive power of the oracle of Balaam. But of course they fail, flesh and blood being what it is in this time before the Singularity. 

Tim Ingham fries up Spotify’s “mission statement” in this must read expose. (Read the post on Music Business Worldwide.) But realize this–you can rest assured that if Daniel Ek didn’t write this claptrap himself, he definitely must have approved it. So if you ever wondered whether Ek had a grip on reality, it appears that his grip is weak. But you know, in the beginning was the word, et cetera, et cetera.]

In Spotify’s words, Loud & Clear exists for one reason above any other: “[To] provide a valuable foundation for a constructive conversation”.

Thing is, it’s not the surface-level data on Loud & Clear – the data that Spotify wants you to pay attention to – that makes for the most “constructive conversation” about the music industry and where it’s headed.

To get to the good stuff, you’ve got to dig a little deeper than that….

Taken at face value, these figures point to the ever-widening base of artists earning decent payouts from the world’s largest subscription streaming platform.

Spotify obviously likes that narrative a lot. As its Loud & Clear site boasts: “More artists are sharing in today’s thriving music economy compared to the peak of the CD era.”

Thing is, any half-credible analysis of these numbers has to take into account how they’ve changed over time.

And when we start treading this path, these figures begin to take on a different nature – one that flies in the face of Spotify’s wonderfully earnest, but laughably silly, mission statement.

Read the post on Music Business Worldwide

by trichordist

Fans and Trust and Trust by Fans Are Essential for AI to Succeed

By Chris Castle

[This post first appeared on MusicTechPolicy]

We are told that artificial intelligence is a powerful tool that may end up being either the end of humanity through automated super soldiers making autonomous decisions regarding their own AI devised rules of engagement, or life saving medical procedures and diagnostic tools like House meets HAL. As usual–both outcomes are probably equally likely if humanity doesn’t keep the deus in the machina. We really don’t want them thinking “Hell is other machines.”

The question I have is how will we keep humanity around when companies like Google are hell-bent on achieving the Singularity ASAP. This is particularly true of creators–let’s not kid ourselves that the Google Books project was some altruistic motivation to build the digital library of Alexandria rather than a massive digitization project to build a large language model to train artificial intelligence through corpus machine translation.  And still is. As Kurt Sutter (show runner for Sons of Anarchy) taught us about Google, “[t]he truth is, they don’t give a shit about free speech, and are the antithesis of their own mantra, ‘Don’t be evil.’” That was 2014 and boy was he right. And he still is. It’s not just Google, but Google is emblematic of Silicon Valley.

One of the lessons we learned from the 1990s is the calvary is not coming. We have to take our own steps to work both cooperatively and defensively against a tech threat. The Human Artistry Campaign and its AI Principles effort is a hopeful indicator that the creative community and its partners are coming together to get ahead of both the threat and the promise of AI.

Let’s not forget that it’s not just about us, it’s also about the fan, our “consumers” if you will. The biggest threat to creators in my view is destroying the relationship of trust that exists between fans and creators. If AI can allow a machine to impersonate a creator, that deception harms the creator, surely. But it also harms the fan. 

One of the AI principles from the Human Artistry Campaign jumped out at me as addressing this vital issue:

  • Trustworthiness and transparency are essential to the success of AI and protection of creators. 

Complete recordkeeping of copyrighted works, performances, and likenesses, including the way in which they were used to develop and train any AI system, is essential. Algorithmic transparency and clear identification of a work’s provenance are foundational to AI trustworthiness. Stakeholders should work collaboratively to develop standards for technologies that identify the input used to create AI-generated output. In addition to obtaining appropriate licenses, content generated solely by AI should be labeled describing all inputs and methodology used to create it — informing consumer choices, and protecting creators and rightsholders. 

Informing consumer choices. For a moment forget the artistic integrity, forget the human intervention, forget the free riding, just for a moment because these are all vital issues, too. At the core of the AI problem is deception and that issue is as old as time. You can’t essentially deceive fans about the origin of a work and you certainly can’t build a machine that does this all the livelong day and pretend you didn’t.

In Book 2 of Plato’s Republic, he uses the legend of a magic ring that turns the bearer invisible to illustrate a dialog on the nature of justice. The ring turns the wearer invisible so that they are capable of doing all manner of things while invisible–or anonymous–that would clearly be both unjust and punishable without the ring. Plato asks if an act is unjust solely because you get caught or is it unjust regardless of whether you are hidden from sight or apprehension. Yep, those Greeks were onto this early.

Deception is not genius. At the core of our concerns about AI is keeping them honest to protect our fans and the bedrock of the creator-fan relationship. Consumers should be able to rely on the reality of what appears to be an artist’s work that it actually does come from that artist. 

We do this with almost any other product or service that is placed into commerce, so why not with creative works? After all, artist rights are human rights.

We were happy to endorse the AI principles and encourage you to find out more about it at the Human Artistry Campaign or Artist Rights Watch and sign the petition.

by Trichordist Editor

Press Release: Human Artistry Campaign Launches, Announces Artificial Intelligence Principles to Sustain Artists

40+ groups representing artists, performers, writers, athletes & more launch campaign for AI that supports human creativity and accomplishment

WASHINGTON, DC / AUSTIN, TX (March 16, 2023) – A broad coalition announced the launch of the Human Artistry Campaign to ensure artificial intelligence technologies are developed and used in ways that support human culture and artistry – and not ways that replace or erode it. With more than 40 members including major unions, trade associations, and policy experts representing individual creators and rightsholders from across the entire tapestry of creative endeavor, the Human Artistry Campaign is positioned to be a leading voice in the rapidly unfolding debate over the costs and benefits of different forms of AI.

The group outlined principles advocating AI best practices, emphasizing respect for artists, their work, and their personas; transparency; and adherence to existing law including copyright and intellectual property. 

The campaign urges supporters to sign a petition to advance these fundamental principles.

The launch was announced at SXSW in Austin today at an event featuring voice actor and prolific songwriter Dan Navarro, GRAMMY-nominated singer-songwriter Jessy Wilson and UT Austin professor and immersive technology expert Erin Reilly – and moderated by Rob Levine, Billboard’s Deputy Editorial Director.

Core Principles for Artificial Intelligence Applications in Support of Human Creativity and Accomplishments

  1. Technology has long empowered human expression, and AI will be no different.

For generations, various technologies have been used successfully to support human creativity. Take music, for example… From piano rolls to amplification to guitar pedals to synthesizers to drum machines to digital audio workstations, beat libraries and stems and beyond, musical creators have long used technology to express their visions through different voices, instruments, and devices. AI already is and will increasingly play that role as a tool to assist the creative process, allowing for a wider range of people to express themselves creatively. 

Moreover, AI has many valuable uses outside of the creative process itself, including those that amplify fan connections, hone personalized recommendations, identify content quickly and accurately, assist with scheduling, automate and enhance efficient payment systems – and more. We embrace these technological advances. 

  • Human-created works will continue to play an essential role in our lives. 

Creative works shape our identity, values, and worldview. People relate most deeply to works that embody the lived experience, perceptions, and attitudes of others. Only humans can create and fully realize works written, recorded, created, or performed with such specific meaning. Art cannot exist independent of human culture.

  • Use of copyrighted works, and use of the voices and likenesses of professional performers, requires authorization, licensing, and compliance with all relevant state and federal laws.

We fully recognize the immense potential of AI to push the boundaries for knowledge and scientific progress. However, as with predecessor technologies, the use of copyrighted works requires permission from the copyright owner. AI must be subject to free-market licensing for the use of works in the development and training of AI models. Creators and copyright owners must retain exclusive control over determining how their content is used. AI developers must ensure any content used for training purposes is approved and licensed from the copyright owner, including content previously used by any pre-trained AIs they may adopt. Additionally, performers’ and athletes’ voices and likenesses must only be used with their consent and fair market compensation for specific uses.

  • Governments should not create new copyright or other IP exemptions that allow AI developers to exploit creators without permission or compensation.

AI must not receive exemptions from copyright law or other intellectual property laws and must comply with core principles of fair market competition and compensation. Creating special shortcuts or legal loopholes for AI would harm creative livelihoods, damage creators’ brands, and limit incentives to create and invest in new works.

  • Copyright should only protect the unique value of human intellectual creativity.

Copyright protection exists to help incentivize and reward human creativity, skill, labor, and judgment -not output solely created and generated by machines. Human creators, whether they use traditional tools or express their creativity using computers, are the foundation of the creative industries and we must ensure that human creators are paid for their work.  

  • Trustworthiness and transparency are essential to the success of AI and protection of creators. 

Complete recordkeeping of copyrighted works, performances, and likenesses, including the way in which they were used to develop and train any AI system, is essential. Algorithmic transparency and clear identification of a work’s provenance are foundational to AI trustworthiness. Stakeholders should work collaboratively to develop standards for technologies that identify the input used to create AI-generated output. In addition to obtaining appropriate licenses, content generated solely by AI should be labeled describing all inputs and methodology used to create it — informing consumer choices, and protecting creators and rightsholders. 

  • Creators’ interests must be represented in policymaking. 

Policymakers must consider the interests of human creators when crafting policy around AI. Creators live on the forefront of, and are building and inspiring, evolutions in technology and as such need a seat at the table in any conversations regarding legislation, regulation, or government priorities regarding AI that would impact their creativity and the way it affects their industry and livelihood.

About the Human Artistry Campaign: The Human Artistry Campaign was launched at SXSW 2023 for open dialogue and guidance from the united creative community in shaping the AI debate. Visit HumanArtistryCampaign.com to join.

Members include: AFL-CIO; American Association of Independent Music; American Federation of Musicians; Americana Music Association; American Photographic Artists; Artist Rights Alliance; Artist Rights Watch; ASCAP; Association of American Publishers; Authors Guild; Black Music Action Coalition; BPI; Christian Music Trade Association; Church Music Publishers Association; Concept Art Association; Department of Professional Employees, AFL-CIO; European Composer and Songwriter Alliance; Folk Alliance International; Future of Music Coalition; Georgia Music Partners; Global Music Rights; Gospel Music Association; Graphic Artists Guild; IFPI; International Federation of Actors; #IRespectMusic; Living Legends Foundation; MLB Players Association; Music Artists Coalition; Music Managers Forum – US; Music Tech Policy; Music Workers Alliance; National Music Publishers’ Association; News Media Alliance; NFL Players Association; NHL Players’ Association; Professional Photographers of America; Recording Academy; Recording Industry Association of America; Rhythm & Blues Foundation; SAG-AFTRA; SESAC, Songwriters of North America; SoundExchange and The Trichordist.

***

www.HumanArtistryCampaign.com

contact@humanartistrycampaign.com

by Trichordist Editor

Save the Date: Artist Rights: The Future of the Copyright Royalty Board for Songwriters Webcast 4/7/23 at 1:45pm CT

More information here https://utcle.org/studio/ZAQ23/ and register here https://utcle.org/conferences/ZAQ23/order-form/

We are excited announce that Chris Castle will be moderating a panel on the future of the Copyright Royalty Board for songwriters (the “Phonorecords” proceedings) as part of the University of Texas School of Law Continuing Legal Education Artist Rights series.

The panelists are Mitch Glazier, RIAA, Clark Miller, Clark Miller Consulting, and Abby North of North Music Group.

The panel will be assessing both voluntary and statutory changes to make the Phonorecords process more representative and efficient and reprises the topic that David and Chris spoke on for the “Smartest People in the Room” series.

by theinvisiblestagehand

The Attack of the StubHub Future Bots: @davidclowery asks the Georgia Legislature when is a Georgia concert ticket a “security”?

By Chris Castle

Silicon Valley’s answer to Charles Ponzi may be called StubHub or its parent company Viagogo. I’m sure you’ve run into the StubHub grift. A band releases tickets for a show, the bots descend and having grabbed the best seats turns to StubHub and its ilk to resell the ill-gotten tickets at ever higher prices. Everyone denies they did anything wrong, they had no idea where their tickets were coming from. Instead of being prosecuted for wire fraud and other bad juju, these ticket scalpers allow reselling of botted tickets on a grand scale. All the while decrying bots as an illegal practice while leaving out the “but we make money together” part. See Better Online Ticket Sales Act (“the BOTS Act”), 15 U.S.C. § 45c.

However vile is this grift, it’s kind of an old story. The only thing that’s breaking news about a Ponzi scheme is not the ghost of Charles Ponzi. Rather, its when smart people–you know, your betters–fall for it yet again. But StubHub revealed yesterday in the Georgia Legislature that they actually thought they would put one over on a wiley old committee chairman who just didn’t buy the huge helping of Smarm by the Bay when the Silicon Valley lobbyists oiled their way into the Georgia House of Representatives Regulated Industries Committee. You have to get up pretty early in the morning to fool and old fox and Valley Boys are not early risers.

The Chairman caught onto the con very quickly, and David Lowery helped to highlight the scalper scam. But the thing you always have to remember about our brilliant friend David is that he’s been known to pick up his pen and write the song that struggled to be written or the song that was not well received, but five years later be promoted as his best work. That’s why he’s got so many loyal fans. David takes know your customer to a whole new level, so was the perfect subject matter witness for the committee. 

So here’s the new twist. What if you didn’t have a ticket but thought that you could get one, no problem once they went on sale–thanks to your friendly neighborhood ticket bot farmer. But what if StubHub made a market for people to buy the opportunity to buy a ticket at some point in the future. That’s right–selling the botted ticket itself isn’t enough for these people. 

Now they want to sell bot futures.

The seller could not sell the ticket yet because there was no ticket available. But why leave money on the table? 

The seller of these future contracts was confident enough to make a contract with someone of unknown business acumen or sophistication who they convince that the seller would have a ticket available by the time the underlying tickets went on sale. As a market maker, StubHub would bring buyers and sellers together in a supposedly arms length transaction–I guess, I mean how would you really know how arms length it was–and the seller sold the buyer a contract to deliver a future ticket. Let’s call these contracts “futures” or “naked call options”. Or perhaps we should call them “securities.”

So just like short sellers have to cover their shorts, when the tickets get released somebody has to come up with the real tickets. Somebody would have to be confident they could get the very ticket described in the option contract–like you would be if you were the beneficiary of botting. Which, as StubHub will tell you, is illegal. So I’m probably just being cynical.

Technically, “botting” is circumventing “a security measure, access control system, or other technological control or measure on an Internet website or online service that is used by the ticket issuer to enforce posted event ticket purchasing limits or to maintain the integrity of posted online ticket purchasing order rules.”

Personally I think it’s worth asking if the act of selling the futures contract is itself a violation of the BOTS Act as a circumvention of various elements. StubHub may have a legal opinion telling them this is outside the BOTS Act, but let’s ask the FTC, shall we?

On the other hand, if StubHub is selling securities, there’s a whole different regulatory agency that should be examining their business, or it could just be Silicon Valley’s answer to hawala.

So when is a ticket a security? One way we can determine this is through a U.S. Supreme Court case that gives us a pretty clear test. One way—and it’s just one way–that an option on a ticket might be regulated as a security is if it is determined to be an “investment contract” under the test in SEC v. W.J. Howey Co.[1]   

The Howey test asks if:

1. there is an investment of money or some other consideration,  [Yes]

2. in a common enterprise, [yes]

3. with a reasonable expectation of profits, [oh, yes]

4. to be derived from the efforts of others. [Mos Def]

So that’s pretty inclusive criteria.  Before anyone brushes aside the possibility that the SEC could determine a futures contract to buy tickets to be a security, take a close look at those criteria because how the basic question is answered is one to discuss thoroughly with your securities litigation lawyer (or engage one). That advice may be a good idea whether you are either an issuer or an endorser of at the ticket or ticketing platform..

One might say that a one-off sale of a unique product—which is truly “nonfungible” in the sense that there is only one of the product in existence—may be less likely to be determined a “security” under the Howey test. But while any one ticket is a one-off, there are many tickets available to many shows as a general rule, so tickets probably are pretty fungible.

You really do have to get up early in the morning to put one over on a wiley old Georgia committee chairman. You can tell just by looking at the body language that he believes what another wise old bird told me as a youngster. If something feels illegal, it probably is.

[1] SEC v. W.J. Howey Co., 328 U.S. 293 (1946).

by Trichordist

@davidclowery: Written Testimony to Georgia Legislature Against StubHub’s Bill

GEORGIA HOUSE OF REPRESENTATIVES

COMMITTEE ON REGULATED INDUSTRIES

ADAM POWELL, CHAIRMAN

WRITTEN TESTIMONY OF DR. DAVID C. LOWERY ON HB 398

My name is David Lowery and I thank the Committee for allowing me to testify today on the StubHub legislation. By way of introduction, I am the founder of the musical groups Cracker and Camper Van Beethoven and a lecturer at the University of Georgia at Athens Terry College of Business.  I have filed amicus briefs in the U.S. Supreme Court in the cases of Google v. Oracle and Frank v. Gaos, testified before Congress on the topic of fair use policy[1] and I am a frequent commentator on copyright policy at the U.S. Copyright Office.  I advocate on artist rights in a variety of outlets, including founding and hosting the Artist Rights Symposium at the Terry College of Business (in its fourth year), my blog at TheTrichordist.com as well as Politico, the New York Times, Hypebot and other publications. Most notably I led the successful songwriter class action lawsuit against Spotify for failing to properly license and compensate self-published writers. Finally, I am a recipient of the National Music Council’s prestigious American Eagle Award “in recognition of his longstanding dedication to protecting the rights of music creators.” With this award I am in the company of such American music luminaries as Quincy Jones, Dizzy Gillespie and Stephen Sondheim.

In the interests of full disclosure, my wife has been a talent buyer at the iconic 40 Watt Club in Athens for many years and now works for LiveNation in a senior capacity.  My testimony today is my own based on my own experiences over many decades in the music business with my bands and my own research into ticketing.  My testimony today will focus on the effects of automated ticket scalping on Georgia’s many artists and resilient music ecosystem, but much of my concerns apply to all ticketed events from sporting events at taxpayer funded venues, to nonprofit fundraisers or even pledge drives for public broadcasting stations.

The Artist-Fan Social Contract Suffers When Bots Attack:  Artists and their fans enjoy a kind of social contract.  The vast majority of fans are small-dollar contributors that sustain their favorite artists.  Artist do not price their tickets at a face value that captures the present value of all revenue the artist will make on a single show.  Tickets are priced with the idea that the costs of sustaining the artist, paying the road crew, gasoline, sound, lights and vehicle equipment rental, housing, and promotion and marketing for an entire tour is amortized over an entire tour or leg of a tour. 

Pricing tickets must be decided so as to allow current and potentially new fans to see the band live which is the railhead of the artist-fan relationship and is one of the most delicate touch points of that relationship.  We do not want to price out loyal fans or new fans.

Ticket scalping has long been a problem that interfered with that social contract.  Like many other areas of our lives, when bots attack, humans suffer.  Companies like StubHub appear to allow or even welcome bot swarms as part of their business model and for all their Silicon Valley know-how, this Big Tech company seems to be unable to control their platform to avoid inflicting this suffering on fans and artists. 

Unlike the careful decision-making that goes into setting ticket prices for a tour in the pre-StubHub era, ticket prices set by these online market makers seem to play an arbitrage game that attempts to extract the maximum price that ticket traders are willing to pay for that one essential artist with the best seating and a well-heeled clientele, rather than the small dollar donor to the artist’s sustenance.  This arbitrage (some would say illegal market cornering) allows StubHub to free-ride on the artists reputation, marketing and other investments in their brand as well as the particular concert.

Ticket scalping has largely become another Silicon Valley racket in my view.  It is virtually impossible for artists to compete and it is impossible for all but the richest fans to get the tickets they want to see the artists they love at a price they can afford. I have come to the realization that it is impossible for artists and fans to fix the problem because it has become a free-rider problem. StubHub isn’t operating because of “fan freedom” or other feel-good bromides. They are drawn to the business for one reason.

StubHub wants to take a skim off the artist’s value and the fan’s love and enthusiasm by commoditizing this exchange at scale. StubHub’s platform is not that different than a commodities exchange; the good could be a Cracker show, a Bulldog’s football game, or a pork belly.  StubHub doesn’t seem to care; they do it for the money and just for the money.

Is StubHub Selling Securities as an Unlicensed Broker Dealer in Violation of the General Solicitation Rule?  I call the Committee’s attention to a phenomenon I discovered in my research for today’s hearing: StubHub appears to be making a market in selling opportunities to buy tickets, i.e., a commodity, that have yet to go on sale. In other words, StubHub appears to be selling an option to buy a ticket in the future that does not yet exist and that the seller doesn’t own. The careful wording of their boilerplate disclaimers is a little too clever, and suggests they are aware of this practice. (Please see Exhibit A that details the author’s purchase of what appears to be the promised delivery of a ticket in the future, rather than the purchase of an already existing ticket).

This practice appears to be selling an option to buy a commodity in the future by an unlicensed broker dealer in a general solicitation to the public without complying with applicable federal or state securities laws.

Paying it Forward: Resale Royalties for Scalpers:  StubHub may refuse to police itself but the State of Georgia can recover some of the value of StubHub’s free riding by establishing a resale royalty to be distributed to artists and venues for transactions occurring in Georgia. California already has a similar law on the resale of fine art. This is a very intriguing idea that would essentially force scalpers to return some of the value they have extracted from the artist’s brand to the state in which the transaction took place. I speak of the resale royalty as returned to artists and venues, but I am program-agnostic. The payment should also be returned to the performers, universities, or taxpayer funded venues around the state.

The resale royalty could be a way to continue to support communities that were hard hit by COVID and venues that survived based on the Save Our Stages funding.  It would be better to fund this support from parasitic free riders than from hard working Georgia taxpayers.

Anticorruption Protections:  When observing the amount of money and the number of high value transactions fixed by StubHub and other online marketplaces—effectively in cash—I am struck by the potential for bad actors to use the platform to hide cash transfers.  I see no reason why StubHub should be treated differently than a bank in reporting these transactions to authorities such as the Georgia Bureau of Investigation or the Department of Revenue.

I would encourage the Committee to work with these agencies to determine the need for more detailed reporting of the origin and destination of higher dollar transactions, such as $10,000 in a single deal or series of deals closed by StubHub and its progeny. It is also apparent that the Georgia Department of Revenue is not likely receiving proper short term capital gains reporting from StubHub.

Conclusion:  If this seems that these recommendations seem to advance the heavy hand of government, I will dispute that—these recommendations allow StubHub an opportunity to fix its own wagon.  As Judge Patel told Napster in 2001, you created this monster, now you fix it. Further as StubHub has come before this august body to urge legislation that would regulate the practices of its market competitors, artists and venues it’s only fair that StubHub receive the same treatment.

[1] See The Scope of Fair Use: Hearing before the Subcomm. on the Courts, Intellectual Property and the Internet of the H. Comm. on the Judiciary, 113th Cong. (Jan. 28, 2014) (statement of David Lowery) [hereinafter Scope of Fair Use].

by Trichordist Editor