Factiness EU Style: A Dedicated Group of Like Minded People Carpet Bombs The European Parliament–MusicTechPolicy

 

EU Hackathon is right! Google’s sleazy EU lobbying firm at the center of the controversy over spam email, robo call, and twitter bot campaign against MEPs supporting articles 11 and 13 of copyright directive. 

I am republishing this from the MusicTechPolicy blog as this is completely relevant to our coverage of information warfare style tactics used to overwhelm communications channels with MEPs on copyright directive. See here, here and here.  Much of this activity came from groups associated with Google and appears to have been controlled and directed by Google’s lobbyist N-Square.  This should be investigated as the use of these tactics will likely increase as Google now faces a steep antitrust fine from the EU.

 

by Chris Castle

As MTP noted in Fair Copyright Canada and 100,000 Voters Who Don’t Exist back in 2009, the legitimate desire by governments to use the Internet to engage with the governed is to be admired.  But there have been incredible and probably illegal uses of the Internet to overwhelm elected officials with faux communications that reek of Google-style misinformation and central planning in the hive mind of the Googleplex.

We saw this again with the Article 13 vote in Europe last week with what clearly seems to be a Google-backed attack on the European Parliament for the purpose of policy intimidation.  That’s right–an American-based multinational corporation is trying to intimidate the very same European government that is currently investigating them for anticompetitive behavior and is staring down a multi-billion dollar fine.

Vindictive much?

Advocacy against Google’s interests on artist rights and copyright issues (not to mention human trafficking, advertising illegal drugs and counterfeit goods) can no longer be just about making a good argument to policy makers.  It has to anticipate that Google will pull these DDOS-type stunts capitalizing on what seems to be the element of surprise.

Except there shouldn’t be any surprise.

There is a real problem with policy-by-DDOS governing.  For example, Cass Sunstein, then the Administrator of the Obama Office of Management and Budget, issued a memo in 2010 to the heads of executive branch departments and regulatory agencies which dealt with the use of social media and web-based interactive technologies.

Specifically, the Sunstein memo warned that “[b]ecause, in general, the results of online rankings, ratings, and tagging (e.g., number of votes or top rank) are not statistically generalizable, they should not be used as the basis for policy or planning.”  Sunstein called for exercising caution with public consultations:

To engage the public, Federal agencies are expanding their use of social media and web- based interactive technologies. For example, agencies are increasingly using web-based technologies, such as blogs, wikis, and social networks, as a means of “publishing” solicitations for public comment and for conducting virtual public meetings.

The European Parliament would do well to take a page from Sunstein’s thinking and limit the amount of anonymous contact that anyone can have with MEPs when the European Parliament is suffering a DDOS-style attack.

But the most important thing for the European Commission to take into account is that a company that is the target of multiple investigations is using the very market place monopoly that caused the competition investigations to intimidate the European government into bending to its will on Article 13.  (That, of course, is the biggest difference between the Europeans and Article 13 and the Americans and SOPA–the US government had dropped the US antitrust investigation into Google and it had unparalleled access to the White House.  So the two are really nothing alike at all.)

The European Commission needs to launch a full-blown criminal investigation into exactly what happened on Article 13, particularly since there is another vote on the same subject coming in September.  Properly authorized law enforcement acting swiftly can set sufficient digital snares to track the next attack which surely is coming while they forensically try to figure out what happened.

Advocates need to understand that Google is a deadly force and this is the endless war.  Good arguments are clearly not enough anymore, particularly as long as the government and law enforcement do nothing to protect democratic values from bully boy tactics.

Are Data Centers The New Cornhusker Kickback and the Facebook Fakeout? — Music Technology Policy

In case you were scratching your head about why Nebraska Senator Ben Sasse decided to stick his beak into trying to continue discrimination against recording artists who had the misfortune to record before 1972–here’s a possible explanation.  Maybe he was just getting his beak wet?

Remember, Senator Sasse introduced an amendment to the Music Modernization Act in the dead of night the day before the markup of MMA in the Senate Judiciary Committee. While Senator Ron Wyden–another data center beneficiary of Amazon, Facebook and Google–was at least trying to dress up his complicity in a Chanel suit and Louboutin shoes.  Senator Sasse went the more direct route:

Now why might Senator Sasse be so interested, particularly given Nebraska’s musical history?  It turns out that there is quite the competition between Nebraska and Iowa for Silicon Valley’s data center business, particularly given the renewable energy profile of each state (wind is 37% of Iowa’s electricity production and about 20% of Nebraska (including hydro).  That checks the box for Silicon Valley.

Of course, as we see from Senator Sasse’s tone deaf foray into copyright lobbying, Silicon Valley thinks they can play the rubes in return for building data centers in their state, just like they did with Senator Ron Wyden and the people of Oregon.  What does stiffing pre-72 artists have to do with data centers?  Nothing.  What does it have to do with playing footsie with royalty deadbeats like Google and Facebook?

Everything.

And rumor has it that there is a deal in the wings for a new Google data center in Nebraska.  Which also explains a lot.

But somehow, Facebook knows that its Silicon Valleyness may not be that popular with the rubes.

According to the Data Center Dynamics site, Facebook has been going to great lengths to hide its involvement in massive data centers being built in Nebraska, which gives “Cornhusker Kickback” (or Facebook Fakeout) a whole new meaning:

Operating under the alias Raven Northbrook, Facebook has its eyes on Nebraska, DCD can exclusively reveal.

Late last year, local council officials granted approval for a large data center project in Sarpy County, Nebraska, but the company behind the huge facility was kept a secret.

Now, DCD can confirm that the corporation hoping to build four 610,000 square foot (56,670 sq m) data center halls at the Sarpy Power Park is Facebook.

You can run servers, but you cannot hide them

SHOW FULLSCREEN

Raven Northbrook, certificate of authority, Facebook

Source: Nebraska Secretary of State

Sarpy County documents reveal that the company, which is publicly represented by infrastructure engineering and design solutions company Olsson Associates, goes by the name Raven Northbrook.

So maybe the Sasse sledgehammer amendment to discriminate against pre-72 artists is easily explained–just another swamp dweller swamping up the cash.

Read the post on Data Center Dynamics

 

Here Comes the Shiv: Sen. Sasse to Move to Strike the CLASSICS Act and Screw Pre-72 Artists With the MMA Bait and Switch— Music Technology Policy

Trichordist readers will not be surprised to learn that Senator Sasse is circulating an amendment to strike the CLASSICS Act from the Senate version of the Music Modernization Act. The amendment appears to have been drafted by the Google Shills at Public Knowledge–bringing the bait and switch right on cue.

This is, of course, the classic back stabbing we have come to expect from Public Knowledge, so is par for the course.  What that means, of course, is that Google gets to screw the pre-72 artists and get their new reachback safe harbor that the songwriters and publishers gave up.

We need to move on this quickly.  If you can call your Senator and ask them to oppose the Sasse amendment to the Music Modernization Act (bill number S. 2823), that would be great.  You can look up your Senator’s information on Phone Congress at this link.  Choose “Any Other Topic Not Listed Here” on the pull down “Topic” menu.

via Here Comes the Shiv: Sen. Sasse to Move to Strike the CLASSICS Act and Screw Pre-72 Artists — Music Technology Policy

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.

 

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.

 

<Gif deleted>

 

Head of Justice Dept Antitrust Division to Speak At Publisher Conference–can end of ASCAP/BMI Consent Decrees be coming?

Really great news!  It was recently announced that the head of the Justice Department’s Antitrust Division will speak at the National Music Publishers Association annual meeting in June!

This year’s keynote will be presented by United States Department of Justice (DOJ) Assistant Attorney General for the Antitrust Division, Makan Delrahim.

As David said a few weeks ago before this announcement, Mr. Delrahim is reviewing hundreds of DOJ consent decrees that have accumulated over the decades to see if these government orders should be continued.  This review includes the ASCAP and BMI consent decrees that Mr. Delrahim specifically mentioned in an address at Vanderbilt Law School earlier this year.  He seems to have come to this idea all by himself.

What’s really great about this is that it could mean the end of consent decrees in a relatively short period of time.  Since it’s never happened before, we don’t know exactly how the end of the consent decrees would impact ASCAP and BMI, but presumably the impact would be positive and quick. Goodbye rate court!  The smart money would probably be on existing rate court cases continuing, but disallowing new cases.  (Mr. Delrahim has been clear that the enforcement side would remain in place, meaning we guess that actual antitrust law violations would be dealt with case by case, just no ongoing regulatory oversight by unelected rate courts.  Example would be Global Music Rights awesome antitrust case against the broadcasters after the broadcasters brought one against GMR.)

It could possibly open the door to both organizations getting into the mechanical licensing administration business in competition with whatever comes of the collective established by the Music Modernization Act (which permits voluntary licenses outside of the collective).  In fact, BMI has already said they intend to pursue licensing outside of performances because their consent decree allows them to do so unlike ASCAP’s:

BMI is also evaluating the option of licensing beyond the performing right. We have long believed our consent decree allows for the licensing of multiple rights, which is why four years ago we asked the DOJ to amend our decree to clarify that ability, among other much-needed updates.

Of course, the last thing that anyone would want is for the DOJ to end the consent decrees, just to be replaced by some other bunch of regulations or bureaucracy.  For once, broadcasters will just have to suck it up.

So it’s a great idea that NMPA is inviting Mr. Delrahim to speak to the publishers who are most in the position to take advantage of a new dawn in songwriter freedom.  Many if not most of the NMPA members will be in the voluntary licensing category under MMA and outside the collective.  They would be in a fantastic position to support a one-stop shop for performance and mechanical licensing from ASCAP and BMI in line with what SESAC/HFA can offer, and presumably GMR could do as well.

@christycrowl: The Music Modernization Act Creates A Database — Is It A Landmark or Landmine for Music Creators, Producers, and Performers? (Part 1) — Artist Rights Watch

From what we have gathered, on May 15, the Senate [held a hearing] on the Music Modernization Act (which now includes the Classics Act and the AMP Act). It’s flying through the walls of government faster than anything we’ve ever seen. Some call it unprecedented. Some say it’s been a long time coming. The music member organizations are touting this as if we are finally getting our moment in the sun. But are we really?

ASIDE FROM CREATING A DATABASE — IS THE MMA A LANDMARK OR LANDMINE FOR MUSIC CREATORS, PRODUCERS, AND PERFORMERS?

There are arguments on both sides from within the music creator community, and it is hard to know who is “right.” All we know is that all of the “member” organizations that directly impact how musicians and music creators get paid (the AFM, ASCAP, BMI, SoundExchange) have communicated to their members to support this bill, to sign numerous petitions to Congress to ensure it passes, etc., without much member discussion on what the cons are of the legislation. In addition, the advocacy organizations (NARAS, SONA, NSAI, the SCL) have also trumpeted support without much point by point member discussion or debate, which to us is deeply concerning.

Is the MMA truly a landmark win for ALL music creators? Will money start flowing to the “little guy” who doesn’t have a publishing deal and plans to utilize streaming services to distribute his/her music, who is totally DIY, who doesn’t understand/care about the inner workings of the music industry and what the difference is between AFM, SAG-AFTRA, ASCAP, BMI, SoundExchange, and Advocacy-only groups such as NARAS, SONA, and NSAI? (This, by the way, is the majority next generation DIY musicians who upload millions of tracks into the streaming services every year.) What will REALLY change for that DIY music creator, producer, or performer? Can he/she plan to retire off of the whopping increase in earnings that passing the MMA will provide? Will they be able to figure out how to register to get their windfall in time before the publishers who are behind the MMA claim it?

If the MMA legislation is so much of a windfall moment for all music creators, producers, and performers — why is it so hard to find a concrete example (or have the advocacy groups even CREATE an example to relate to) of a DIY music creator and how the MMA will help him/her earn more income for their music (or musical contribution) from streaming? Why haven’t the member organizations provided examples of “if you wrote this, recorded this, produced this, and/or released it on a streaming platform, this is how passing the MMA will improve your music creator/producer/performer life” as a part of their non-stop rally of support for this bill? And what about the musician unions? If they want musicians to support the MMA, why haven’t they provided any examples of how a session musician (or lead singer) who played/sang on a track that is now released on a streaming service will benefit?

YOU HEARD IT HERE FIRST: THE “LANDMARK” DATABASE WILL MAKE OR BREAK THE MMA’S (THE MLC’s) SUCCESS

Read the post on Medium

 

No MMA Bait and Switch #irespectmusic: @terrencehart: No, the CLASSICS Act is not a “term extension”

Lemley Google Transparency

Mark Lemley’s record from Google Academics.

Artist Rights Watch

[Editor Charlie sez:  As David Lowery has posted, it’s looking like the Senate version of the “Music Modernization Act” may not include the CLASSICS Act which would require royalty deadbeats at the Digital Media Association, SiriusXM and Pandora to pay their fair share of performance royalties for our legacy artists who recorded before 1972.  This loophole has been exploited and defended by the head of the Digital Media Association while he was formerly at SiriusXM and Pandora.  David caught him promoting a position from Google shills Public Knowledge and now Terry Hart has called out Professor Mark Lemley for trying to pull the bait and switch from the House bill to the Senate version of MMA (which means “Music Modernization Act” not “Make More Algorithms”).  Professor Lemley has plenty of entries in the “Google Academics” database, a handy tool for tracking Google’s influence.]

On April 25, the U.S. House…

View original post 293 more words

@mikehuppe: “We are Making Major Progress on Music Licensing Reform – Together” #irespectmusic — Artist Rights Watch

While several pieces of music legislation have been introduced in the Senate, there is not a single comprehensive package yet. We are encouraging our Senate allies to bring these many issues together into a single, comprehensive Music Modernization Act, like the bill passed in the House.

via @mikehuppe: “We are Making Major Progress on Music Licensing Reform – Together” #irespectmusic — Artist Rights Watch

Guest Post Marc Ribot: The Red Ink Beneath Streaming’s “New Dawn”

Marc Ribot. Photo ©Barbara Rigon All Rights Reserved

Guest Post from the legendary guitarist Marc Ribot. One point that Mr. Ribot makes we would like to further emphasize at the outset: without DMCA reform there is no “market” for Copyright Royalty Judges to set rates under the MMA. This comes on the heels of a paper from Stan Liebowitz at the University of Texas.  The Liebowitz study clarifies how the safe harbor, contrary to its intended purpose, creates an inefficient and unfair advantage for UUCs when bargaining with copyright owners, meaning that UUCs either do not pay for copyright permissions or, if they pay something, they pay less than the market rate.

____________________________________

The following article examines the effect of ECM’s switch to Spotify – and the larger, tectonic shifts in the industry of ECM’s move is part –on indie jazz labels and artists: and suggests a course of action.

The Red Ink Beneath Streaming’s “New Dawn”

 “structural” failure, “not viable” “we’re fucked”

The Music Modernization Act (MMA) , creates a mechanism for setting of rates and payment of royalties to publishers by streaming services,  while insulating the services from liability for  claims outside its structure. It is widely seen as clearing the way for Spotify’s long awaited IPO.

This, in turn, is seen as a harbinger of the coming of Age Of Streaming.

I don’t think there’s been so much unanimous celebration of a “new dawn” since Joseph Stalin grew a mustache.

The MMA will indeed, if adopted with the changes proposed by Music Answers and others in the indie world, hopefully expand collection and distribution of songwriter royalties for interactive streaming. But even at the most optimistic outcome, streaming is simply not viable for the majority of indie recording musicians and labels.  [1]

And it never will be viable, as long as internet giants like Google/YouTube can profit from copyright infringement with impunity by hiding behind the “safe harbor” clause of section 512 of the DMCA.[2] [see glossary of acronyms at the end of the article].

Until then, for the majority of indie artists, the MMA will at best re-arrange the deck chairs on the Titanic, and at worst, weaken the coalition that might have made a real solution possible.

In genres such as jazz, where clusters of small labels have been able to survive the already devastating effects of bit torrent/piracy and YouTube et al’s legal infringement (60% collapse of industry revenue) by creating niche markets based on physical object sales and legal downloads, the signs are already clear that this consolidation/rationalization of streaming (of which the MMA is a component) will drive many of  the current labels out of business.

What does “not viable” mean? It means that where once revenue received from the sale or licensing of a recording  amounted to more than the cost of producing it,  now, it doesn’t.

“Our issue with streaming is so much greater than just whether an organization like A2IM can double the payout from Spotify from $0.004 per stream to $0.008 per stream. The issue is more structural cause we’re fucked at either payout rate.”

(Yulun Wang, co-owner Pi Recordings).

The problem isn’t just that streaming rates aren’t viable, its that they are displacing forms—cd’s, vinyl, and legal downloads—that are (or were).

I’m an indie artist who has lost money on three of the last four cds I’ve made. What made them possible at all was the investment of record companies like Pi, whose co-owner is quoted above.

Since its founding in 2001, Pi Recordings has released important recording in and around the jazz idiom by Henry Threadgill, Steve Coleman, Muhal Richard AbramsArt Ensemble of ChicagoJames Blood UlmerVijay IyerWadada Leo Smith, and many others.

(Pi happens to specialize in jazz: the economics for indie labels in rock, classical, or other niche markets are similar).

After an initial attempt to distribute through Spotify resulted in receipts of less than $200 — for the entire catalogue!— Pi withdrew.

Pi’s experience with Spotify is typical of small labels on other streaming platforms as well.

John Zorn’s Tzadik label has been a central institution of NYC’s Downtown New Music scene since the early 90’s . Recently, the entire Tzadik catalogue  was (accidently, and against John’s specific instructions) placed on Google’s streaming network for 6 months.  When John found out about this, he immediately withdrew the catalogue: his 6 months of streaming had produced over 250,000 streams,  generating: $300 in total for the entire catalogue.

Tzadik’s total annual budget for recording is c/a $60,000usd. [3]

You don’t need a supercomputer to see what the $300 dollars in 6 months “Age Of Streaming” will do to Tzadik.

That’s what “not viable” means.

What has enabled Pi and other small Jazz labels to survive outside the streaming world thus far has been the existence of a market for CDs and downloads. What in turn kept that market viable was that other important jazz labels, notably ECM, had also withheld their catalogues  from Spotify. This meant that a significant jazz buying public participated in the CD/vinyl economy: ie: they owned cd players and turntables, and acculturated to going to stores, visiting Bandcamp, Amazon, or label websites, to order their music.

Below is the reaction from Yulun Wang, one of the two co-owners of Pi Recordings to news that ECM had finally capitulated to Spotify:

“ECM embracing streaming so wholeheartedly feels like a dagger to the heart – We had long felt that they were part of some informal bulwark of independent jazz labels who were the final holdouts from the streaming platforms. With them falling, it just makes it more difficult for us to continue hold out…

Of course this past weekend it was announced that Cuneiform, a fine jazz label that has been around for over three decades, has decided to take time off to reconsider their future.

I hate to be so dark, but it’s just looking so bleak. [4]

Yulun isn’t an engaged artist rights activist. In fact he tended to be fairly apolitical on these issues…until recently.

“Structural” Failure, “Not Viable”  “We’re Fucked”

This isn’t just a problem for labels.

It costs me as an artist 5-15 thousand to make a record: and months to years of work.

On a recording I released with a label other than Pi that did stream with Spotify, I made c/a $260 from Spotify for the first 18 months—the prime sales period.

When I asked what passage of the MMA would really mean, a trusted insider to MMA negotiations (and an MMA supporter) told me:  “you know those artist checks you get from Spotify? Well, now you’ll get another one for publishing.”

If the rationalization of streaming further displaces the physical object and legal download market that used to pay for my recordings and leaves me with $520 for a  $10,000 expense…?

That’s what “We’re Fucked” means.

If, for Taylor Swift, streaming was a bad deal, for indie artists and their labels, particularly those catering to emerging artists, or to niche markets like Jazz, Classical, and experimental, the damage is often terminal.

Whether the MMA will make that deal more beneficial for small songwriters rests heavily on the degree to which indie songwriters advocates like Music Answers succeed in amending it.

http://www.musicanswers.org/the-music-modernization-act-we-can-must-do-better/

But its beneficiaries will in either case not include most indie labels or non-songwriting recording musicians. [1]

The root cause of the damage is not Spotify per se. Spotify is, first of all, legal: unlike YouTube or the pirate sites, its business model is not dependent on the mass violation of artists’ copyrights.  I see no reason to disbelieve Spotify’s claim that they are charging consumers, and maybe even paying artists, as much as the market will bear.

The underlying problem is that there IS no market…nor can there possibly be one, so long as YouTube and pirate sites make our work available, without our consent or remuneration, for free.

And YouTube et al will continue to do so as long as section 512 of the DMCA  gives them a special privilege “safe harbor” protection from liability for the damage we suffer when they do.

The “grim” reality faced by Pi and other indie labels or the musicians whose recordings they finance[d] isn’t going away until YouTube et al’s special privilege “safe harbors” are made contingent on their adopting real measures[2]  for stopping mass infringement. The technology already exists for doing so—without hurting “fair uses”.[3]  The legal framework for protecting start-ups or “small business” OSPs[4], or ANY business for which adoption poses a problem is already written into the DMCA.

Section 512 reform wouldn’t “force” anyone to do anything.

But if major corporate online platforms specializing in the distribution of content (like YouTube) fail to take reasonable action to address infringement, including through the use of readily available technologies to avoid providing access to clearly infringing materials, they would lose their special privilege Safe Harbor protection from normal liability.

If section 512 reform passes, we get a market back. If it doesn’t we don’t.

All the rest is hype:  NO industry can survive in competition with an open Black Market making its products available for free.  Sadly, ours is no exception.

SO WHAT CAN WE DO?

The real practical solutions to the current market failure have already been written: The Music Community Response to the Copyright Offices inquiry on section 512 of the  DMCA.[5]

In order for there to be a market in recorded music, these solutions now need to turned into law.

And in order for that to happen, we’re going to need all the Music Community signatories to commit their full energy and resources to reforming section 512.

Make no mistake: Google, YouTube, and others making billions annually in ad-based and data mining profits on infringing content do not like 512 reform.  They’re going to fight it tooth and nail…and they have the sharpest teeth and nails that money can buy.  Any realistic chance that such powerful opposition can be overcome lies in the hope that the Music Community’s power can be expanded – for example by mobilizing the memberships of its mass organizations – not reduced.

The coalition which drafted and signed that “Music Community” document, including the  AFM, SAG-AFTRA, A2IM and, (after negotiating amendments) SGA, have stuck together to endorse the MMA,  even though their non-songwriting or small songwriting memberships will benefit only marginally, if at all, from the bill’s passage.

Its time for those “Music Community” coalition organizations whose members will benefit from MMA—NMPA, SESAC, ASCAP and BMI –to return the favor by demonstrating in some tangible form their commitment to fighting for 512 reform now.

Some trustworthy advisors have warned that failure to pass the  MMA  would kill the chance for ANY pro-artist legislation—including section 512 reform—for at least 10 years.

Others have claimed that making the MMA’s passage contingent on section 512 reform is simply not realistic.

But “realism” cannot mean participating in the rationalization of our own extinction.  Drowning under 3 feet of water instead of four is not an acceptable compromise.

If the MMA’s “Grand Bargain” being negotiated by our leaderships paves the way for streaming to kill cds and downloads,  leaves us with $500 to pay $10,000 bills,  drives labels that used to fund our records out of business, and splits the coalition that would have enabled meaningful reform,  then why should we care whether it passes?

The large majority of my union’s recording members are indie musicians.
What good does it do us to read from a distance of the gleaming benefits and protections of a union contract while, like the urban slum dwellers of Blade Runner, our real lives consist of scavenging to self-finance recordings in the wreckage of the recording economy (or doing sessions for equally cash starved indie labels or artists subject to the same impoverishment)?

And what good will it do any AFM or SAG AFTRA member if, as some have predicted, the Major labels – which DO pay scale – are only backing the MMA to pave the way for Spotify’s IPO, after which they can cash in their equity, write golden parachute contracts for their chief executives, downsize into distribution offices for their back catalogue,  and cease (directly[6]) funding new recording?[7]

Beneath the unanimity of the Music Community’s support for the MMA, there is deep dischord, with many quietly pushing for amendment behind the scenes; and many others (including trusted artist advocates David Lowery, and atty Chris Castle opposing the bill outright.

My union, the AFM, supports the MMA. But my AFM Local, 802, has quietly urged the AFM to support Music Answer’s proposed amendments.

Having attended an open meeting on the MMA at local 802, I can tell you that even such conditional support was contentious among rank and file union members.

If the MMA’s backers want to keep simple narratives of unanimous musician uplift and support in the public eye,  if NMPA, ASCAP,  and BMI want to deliver the MMA’s substantial benefits to their big publisher and major songwriter members, and if their Music Community union allies want to avoid a rank and file revolt, then I would advise all the above to take immediate steps to ensure inclusion of Music Community section 512 reform in Senator Goodlatte’s proposed comprehensive reform bill.[8]

If such attempts prove impossible to achieve, the Music Community organizations—ALL OF THEM– should present tangible proof that they are willing to develop, FUND, and commit to a campaign to fix the real problem: 512 of the DMCA.

Maria Schneider and  Chris Castle’s opposition to the MMA has focused on the ways the bill’s fine print undermines some of the gains for songwriters advertised as it goals.  Other pro-artist groups—SGA, SONA, and Music Answers – have pursued the bill’s amendment, rather than its defeat, because, while acknowledging many of the same critiques as the bill’s opponents, they believe that its aggregate effect, if amended, would be beneficial for songwriters.

But while feverishly guarding the castle walls against the MMA’s hidden effects on songwriters, we may have permitted the real Trojan horse to pass through the main gate unopposed: and that  horse is strategic: the undermining of the basis for unity of the ONE coalition – the “Music  Community”[9] which up till now has included major labels, major publishers, and major songwriters– that can achieve section 512 reform.

It is my strong suspicion that if indie artists/musicians wait till after the MMA passes to try to get the Music Community to win or commit to 512 reform, we— and small songwriters– are going to be left with about as much negotiating power to achieve that goal as the Trojan women[10] after their city’s defense was breached.

I want to be clear that I consider payment of royalties to songwriters — the stated intention of the MMA–  entirely justified and fair. And I’m grateful to Hakim Jeffries, Bob Goodlatte, and the MMA’s other congressional supporters for their efforts to redress this longstanding injustice.

But the economic survival of the majority of working recording musicians[11] and the labels which finance them  is dependent on 512 reform. That statement is true today, and will be radically more true in the future streaming economy that the MMA will help create. [12]

Our representatives can address our grave concern by acting to put their budgets and political leverage where their USCO policy statements[13] are. We need an actionable plan to win section 512 DMCA reform NOW—while united action is still possible. “Call us after the MMA is passed” won’t do.

Because if the MMA means that our realistic hopes for section 512 reform are being sold,  then as far as I’m concerned: Spotify can keep its $260 spare change, and, to paraphrase Johnny Paycheck,  they, and Google, and ALL the powerful organizations which have signed on to it can ‘take this “Grand Bargain”… and shove it.’

A GLOSSARY OF ACRONYMS:

A2IM American Association of Independent Music: the indie label trade organization.

AFM American Federation of Musicians: the musicians union

DMCA: Digital Millenium Copyright Act of 1997-98: the US law governing copyright on the internet.

MMA: Music Modernization Act.

NMPA  National Music Publishers Association: representing large publishers

RIAA, Record Industry Association of America: the major label trade organization.

SAG-AFTRA Screen Actors Guild—American Federation of Television Radio Artists: the union representing vocalists and actors.

SGA, Songwriters Guild of America, an indie song writers organization.

SONA Songwriters of North America: an indie songwriters organization

USCO – U.S Copyright Office

Footnotes

[1] This matters for several reasons.

  1. Jobs: although the indie sector is a minority of market share, it provides the large majority of work.
  2. Culture: every single current pop genre began as a niche market. If you kill the cultural goose, no more golden omelettes.

[2] > end special privilege ‘safe harbor’ protections for corporate Online Service Providers (OSPs) with ‘red flag’ knowledge of mass infringement.

>end  the game of whac-a-mole: reform the DMCA so that  a single take-down notice effects the take-down of all identical files on a site…permanently.

> The technology to protect our rights – without harming freedom of speech or genuine ‘fair uses’ — exists now: and should be made standard (Standard Technical Measures, or STM’s) for all major hosting platforms specializing in the delivery of content. No “Safe Harbor” for for major corporate Online Service Providers (OSPs) which fail to adopt STM’s.

[3] See Audible Magic’s 2016 submission to the Copyright Offices inquiry on Section 512 of the DMCA

[4]  The figure cited by a PRO-artist advocate for defining “small” was capitalization of 30 million usd or less.

[5] The  full  report can be found by searching  for “American Association of Independent Music et al (“Music Community) first round comments https://www.regulations.gov/docketBrowser?rpp=25&so=ASC&sb=title&po=0&s=music%2Bcommunity&dct=PS&pd=ALL-07%7C01%7C16&D=COLC-2015-0013

The bullet points in footnote 6 are consistent with its recommendations.

[6] The practice, already begun, of licensing  non-union indie recordings would no doubt continue.

[7] And what good will it do our culture and economy? Back catalogue sales are great: but we didn’t become a world emulated cultural model or a major exporter of  music by funding the dead.

[8] https://www.tennessean.com/story/money/2018/02/21/goodlatte-unveil-sweeping-music-copyright-reform-package-next-month/354500002/

[9] op cit see footnote 9

[10] suffice it to say that 3000 years after the sacking of their city, the word Troia still means prostitute in Italian.

[11] including small songwriters who will receive some benefits under the MMA. Songs large and small don’t produce income if they’re not brought to market in the form of a recording.  We all rely on section 512 reform to restore a healthy market for recording.

[13] Music Community Response to the USCO Inquiry in section 512 ibid.

[1] note: although indie artists’ work accounts for a minority of market share, it represents a large majority of employment in the industry, and we represent an even larger majority of working artists.

[2] http://www.cisac.org/Newsroom/News-Releases/Copyright-safe-harbours-distort-digital-market-profit-tech-giants-and-harm-creators-new-economic-study-finds

[4] I’ve heard similar expression from other indie labels and musicians, but it rarely finds its way into the media. Then again, no major conglomerate is paying the publicists who might put it there.

Not only does the move to streaming favor the large-back- catalogue Majors against their indie competitors, but the Major Labels all have equity in Spotify, whose coming IPO would not benefit from the amplification of voices such as Yulun’s.