EU and Article 13: The Dystopia That Never Was and Never Will Be

Authors: Stefan Herwig and Lukas Schneider. This  article originally appeared as Upload Filters: The Dystopia Has Been Canceled on the Frankfurter Allgemeine Zeitung here.  German language version here. Translated from German to English by Sarah Swift.
© Frankfurter Allgemeine Zeitung GmbH 2001 – 2019 All Rights Reserved. Reprinted with permission. 

The “Declaration of the Independence of Cyberspace“ published in 1996 by John Perry Barlow begins with the words “Governments of the Industrial World I come from Cyberspace, the new home of Mind. On behalf of the future, I ask you of the past to leave us alone.” One reading of this text entirely rejects the possibility that processes of making and enforcing collectively binding decisions – political processes – apply on the Internet. Another possible reading sees the Internet as a public space governed by rules that must be established through democratic process while also holding that certain sub-spaces belong to the private rather than the public sphere. The distinction between public and private affairs, res publicae und res privata, is essential for the functioning of social spaces. The concept of the “res publicae” as “space concerning us all”  led – and not only etymologically – to the idea of the republic as a form of statehood and, later, as a legitimate space for democratic policymaking.

On the Internet, this essential separation of private and public space has been utterly undermined, and the dividing lines between public and private spaces are becoming ever more blurred. We now have public spaces lacking in enforcement mechanisms and transparency and private spaces inadequately protected from surveillance and the misuse of data. Data protection is one obvious field this conflict is playing out on, and copyright is another.

The new EU Directive on Copyright seeks to establish democratic rules governing the public dissemination of works. Its detractors have not only been vociferous – they have also resorted to misleading forms of framing. The concepts of upload filters, censorship machines and link taxes have been injected into the discussion. They are based on false premises.

Upload filters as cogs in a censorship machine

What campaigners against copyright reform term “upload filters” are not invariably filters with a blocking function; they can be simple identification systems. Content can be scanned at the time of uploading to compare it to patterns from other known content. Such a system could, for example, recognize Aloe Blacc’s retro-soul hit “I need a Dollar.” Such software systems can be compared to dictation software capable of identifying the spoken words in audio files. At this point in time, systems that can identify music tracks on the basis of moderately noisy audio signals can be programed as coursework projects by fourth-semester students drawing on open-source code libraries. Stylizing such systems as prohibitively expensive or as a kind of “alien technology” underestimates both the dystopian potential of advanced pattern recognition systems (in common parlance: artificial intelligence) in surveillance software and similar use cases while also underestimating the feasibility of programming legitimate and helpful systems. The music discovery app “Shazam,” to take a specific example, was created by a startup with only a handful of developers and a modest budget and is now available on millions of smartphones and tablets – for free. The myth that only tech giants can afford such systems is false, as the example of Shazam or of enterprises like Audible Magic shows. Identifying works is a basic prerequisite for a reformed copyright regime, and large platforms will not be able to avoid doing so. Without an identification process in place, the use of licensed works cannot be matched to license holders. Such systems are, however, not filters.

How do upload filters work?

The principal argument of critics intent on frustrating digital copyright reforms that had already appeared to be on the home stretch is their charge that the disproportionate blocking of uploads would represent a wholesale assault on freedom of speech or, indeed, a form of censorship. Here, too, it is necessary to look more closely at the feasibility and potential of available options for monitoring uploads – and especially to consider the degree of efficiency that can be achieved by linking human and automated monitoring. In a first step, identification systems could automatically block secure matches or allow them to pass by comparing them against data supplied by collecting societies. Licensed content could readily be uploaded and its use would be electronically registered. Collecting societies would distribute license revenue raised to originators and artists. Non-licensed uses could automatically be blocked. In a second step, errors could be caught through a complaints handling system making decisions on whether complaints are justified on the basis of human analysis – this would represent a clear improvement on the current procedures used by YouTube and Facebook. What automated pattern recognition systems cannot do is determine the meaning of content items at the semantic level. This means that they cannot identify legitimate uses of protected works – in the context of parodies or mash-ups, say, or when an image is reproduced online in a piece of art criticism. In such cases, the identification system would report a “fuzzy”  match, stating for example that 40% of a given upload corresponded to a copyrighted file known from the database. To achieve a legally watertight result here, human judgment would be required. Humans can recognize parodies or incidental uses such as purely decorative uses of works in ways that that do not constitute breaches of copyright.

The process of analysis could be simplified further by uploaders stating the context of use at the time works are uploaded. Notes such as “This video contains a parody and/or uses a copyrighted work for decorative purposes” could be helpful to analysts. The Network Enforcement Act (NetzDG) in Germany provides a good example of how automatic recognition and human analysis can work in tandem to analyze vast volumes of information. A few hundred people in Germany are currently tasked with deciding whether statements made on Facebook constitute incitement to hatred and violence against certain groups or are otherwise in breach of community rules. These judgments are significantly more complex than detecting impermissible uses of copyrighted works.

Being obliged to implement human monitoring will, of course, impose certain demands on platforms. But those most affected will be the platforms with the largest number of uploads. These major platforms will have the highest personnel requirements because they can host content of almost every kind: music, texts, video etc. Protecting sites like a small photo forum will be much simpler. If only a modest number of uploads is involved, the forum operator can easily check them personally at the end of the working day. In that case, uploaders will simply have to wait for a brief period for their content to appear online. Or operators can opt to engage a service center like Acamar instead of adding these checks to their own workloads. Efficient monitoring is possible.

An additional misinterpretation propagated by campaigners against copyright reform is that platforms will have to take out licenses for all the content in the world from a near-infinite number of licensing partners. This, too, is inaccurate, since the transfer of liability to platforms only arises in cases in which rightsholders have specifically prohibited the unlicensed use of their works and had the works in question added to a database made available to platform operators through collecting societies. Visions of upload filters leading to dystopian censorship are, it follows, unfounded. This should be clear to anybody who has read the text of the directive and has even a basic working knowledge of informatics.

For a free Internet, we need copyright reform

The reform provides a basis for ensuring artists are fairly remunerated for their work and forces rightsholders to assist in the identification of works by registering their content in databases. Both effects are highly advantageous for users. Under the proposed regime, somebody who wants to use the Rage Against The Machines track “Killing In The Name Of”  on the soundtrack of a protest video will no longer have to worry about copyright and can simply upload the video to a platform. Works used will be identified, and the relevant collecting societies will distribute the licensing revenue they receive from the platform. If Rage Against The Machine has objections to the transformative use of their work, they can communicate them to the database. Once the directive has been transposed into national law, this procedure will become standard practice.

It will become possible to publish more content and easier to comply with the law. All of this will contribute to more freedom on the Internet – the kind of freedom that stems from having democratic rules rather than allowing tech giants with their community rules and automated decision-making processes to determine what content is permitted on their platforms and what they are prepared to pay for it.

Barlow overlooked what the author William Gibson had already recognized – that enterprises, when they make the rules, can become more powerful than states. The rejection of state-guaranteed democratic rules creates the power vacuum required for this to happen. This is the wider context that explains why copyright reform is but one battlefield in the struggle for political power on the Internet. YouTube should not be allowed to become the Internet for videos just as Google has practically already become the only filter for web searches. Amazon should not be allowed to evolve from a vendor in the market to the provider of the market and to dictate the earnings of parcel couriers. Rules in digital space must be created and weighed against each other by democratic means and not in an arbitrary fashion dependent solely on who wields the most market power. Artists and net activists should fight this battle together, because the Internet is not some abstract parallel dimension: its data flows determine our creditworthiness just as they supply us with holiday pictures and pervade every aspect of modern life. If we relinquish democratic control over this public space, we will become subject to the despotic rule of neoliberal tech giants, and not merely on the Internet.

Barlow’s manifesto ends with the words: “We will create a civilization of the Mind in Cyberspace. May it be more humane and fair than the world your governments have made before.” Copyright reform will take our society one step closer to this aim. The quasi-governments that must now be opposed are called Google, facebook und Amazon. Those who take the side of these giants in this controversy are opposed to the free Internet in the true meaning of the word.

Translation from German by Sarah Swift.

Authors

Stefan Herwig and Lukas Schneider jointly run a think tank, Mindbase, that tackles questions of Internet policy with academic rigor. Stefan Herwig works in the music industry and advises politicians and enterprises on digital policy issues. Lukas Schneider is an information science expert and a musician and is active in Germany’s Green party (Alliance ’90/The Greens).

Pledge 2019 EU Campaign: Old Wine in New Bottles

In summer 2018 the campaign platform Saveyourinternet.eu set up to fight against the EU copyright reform. The campaign was organized by C4C, which is mainly financed by the American CCIA and the Open Society Foundation. This was criticized at the time. The website Saveyourinternet was later “taken over“ by EDRi; C4C was out.

Now there is a new action platform Pledge2019.eu, which claims to be “independent“ and „without any support from Google or other web giants.”

pledge_1_eng

We need to look at this in more detail.

The Saveyourinternet.eu story
In the fight against the EU Copyright Directive, Saveyourinternet.eu’s campaign in summer 2018 was primarily responsible for the bombardment of MEPs with pre-written e-mails, automated tweets and arranged telephone calls, including discussion guidelines.

The campaign was organized by Copyright for Creativity (C4C) and its secretariat N-Square. The C4C has 42 members (EFF, EDRi, BEUC etc.) and, according to its own statements, is mainly financed by the Open Society Foundation (OSF) and the Computer & Communications Industry Association (CCIA). Members of this American industry association include Amazon, Cloudflare, Facebook, Mozilla, Google and Uber.

The page was registered in spring 2018 by the Belgian lobby company N-Square, which also works für Google. And today the registration data and the domain location are concealed by EURID and Cloudflare. The site does not have a legal imprint. There is only the notice that it is “managed” by the EDRi organization.

The new campaign page – Pledge2019.eu
The new campaign page is called “Pledge2019.eu” and is used to organize telephone calls to MEPs. The system connects the user either directly with an opponent suggested by the system or the user can select a time to speak with one of the proponents.

Epicenter.works from Vienna is responsible for the content. Legal notice and data protection declaration are, as very often is the case, borderline. But that is not the point.

pledge_Tab_1_eng

The site refers (as of 8.3.2019) to 17 organizations which are in some way connected to the site.
Besides EDRi, the current “manager” of Saveyourinternet.eu, there are 13 members of EDRi (3 of them “Observer”). Only three organizations do not belong to EDRi.

Ten of these 17 organizations are also listed at Saveyourinternet.eu. Saveyourinternet also links to Pledge2019.eu using the button “ACT NOW – CALL MY MEPs”.

The impression is that the creators of the old campaign (Saveyourinternet.eu) also operate the new action platform (Pledge2019.eu).

The donors
Pledge2019 emphasizes its independence on the homepage: “This is an independent campaign without any support from Google or other web giants”.

Who exactly pays the bills of the campaign cannot be verified by an outsider. A look at the groups involved is very revealing indeed. To what extent do they appear independent? Have they received money from “Google or other web giants” in the past?

Even a first glance at the transparency reports – some of them are good but often completely non-transparent (more on this below) – is significant.
Even those responsible (Epicenter.works) reported in the Transparency Report 2017 that Mozilla is supporting them with €21,630; which is just over 6% of annual revenues. Another big supporter is the Chaos Computer Club with €15,000. Membership fees are not shown, Epicenter is mainly financed by donations.

Mozilla, which receives its income primarily from Google, also supports other stakeholders, including the Dutch Bits of Freedom, EDRi and the Open Rights Group from the UK. At Bits of Freedom, Mozilla is the largest single donor (petabit-donateur) with more than €10,000 per year. How much was actually paid remains open. At the Open Rights Group, the Mozilla Foundation paid £6,900 in 2016.

Other Internet companies are also mentioned in the reports as donors, such as Leaseweb (often named in connection with piracy) with €5,000 for Bits of Freedom or Microsoft (€10,000) and Wikimedia Germany (€5,793) for EDRi in 2017.

But even Google appears as a direct donor, namely at the Polish Fundacja Panoptykon in 2017 with a four-digit amount and in 2016 with 57,190 Złoty (approx. €13,000) from Google Polska SA and at EDRi in 2016 with €23,000 and in 2015 without stating the amount.

pledge_3_eng
Figure: EDRi – Annual Report 2016, page 40 (in pdf page 43).

EDRi – The finances
Since Pledge2019.eu is mainly backed by EDRi members, it would be a good idea to take a closer look at the finances of EDRi.

In 2017, EDRi generated €728,816. There are hardly any contributions from members. With €39,941 only 5.5% of the revenues are „Members and observers fees“.
2017

EDRi – The finances
Since Pledge2019.eu is mainly backed by EDRi members, it would be a good idea to take a closer look at the finances of EDRi.
In 2017, EDRi generated €728,816. There are hardly any contributions from members. With €39,941 only 5.5% of the revenues are “Members and observers fees”.
2017
Mozilla appears in various positions with a total of €87,205 (Mozilla Corporation: €26,897, Mozilla Corporation: €4,000, Ford Mozilla Open Web Fellow: €34,327, Mozilla Advocacy Fund: €21,981). In total, this is almost 12% of the budget.
The largest donors of EDRi are three foundations:
– Open Society Foundation: €139,596
– Ford Foundation: €136,275
– Adessium Foundation: €131,016.
Their contribution to the financing of EDRi in 2017 was 55.8%.

pledge_4_eng

Figure: EDRi – Annual Report 2017, page 40 (in pdf page 43).

These three foundations also supported EDRi in 2016 with five- to six-digit amounts. The largest donor with €127,080 in 2016 was again the Open Society Foundation.

The importance of foundations
Among the 17 organizations on Pledge2019.eu are two with a budget of less than €2,500 (IT Politcal Association of Denmark, D3 – Defesa dos direitos digitais). The Bulgarian organization could not be examined due to the Cyrillic character set.
Four organizations (Apti, Hermes Center, Homo Digitalis and Xnet) do not disclose funding either on their website or in the EU Transparency Register. However, at least the Open Society has information on Xnet.

Of the remaining 11 organizations, only the Chaos Computer Club is almost totally funded by membership fees. The other ten all disclose donations from at least one of the three listed foundations. In nine cases the Open Society Foundation finances; in three cases the Adessium Foundation; in one case the Ford Foundation.
The Centrum Cyfrowe claims to receive €281,242 from international organizations in 2018. The Open Society Foundation reports a core support of US$240,000 to this organization for the years 2017 – 2018.

Whether all supporters were found remains to be seen. While the Ford Foundation offers a database with all grants, Adessium provides at least a list of the recipients. The Open Society Foundation, which was classified by Transparify as America’s most non-transparent think tank in 2016, is now presenting a database with data from 2016 onwards. However, not all organizations that claim to be financially supported by the OSF can be found there, possibly due to intermediary organizations.

Picture5.png

The Ford Foundation and the Open Society Foundation do not appear for the first time as lobbyists against Internet regulation. Both intervened on the subject of net neutrality:

„In areas where Google doesn’t spend the cash directly, it can rely on others to help. Foundations including […] Open Society Institute and the Ford Foundation align closely to Silicon Valley’s view on IP policy. The OSI funds a number of groups who style themselves as „civil society“ or „human rights“ (sic) outfits, including EDRI.“[theregister.co.uk]

Limited transparency
Some transparency reports are very detailed, at least in the years 2017 and 2016, such as EDRi or the Fundacja Panoptykon.

In other organizations, only single figures are disclosed, but the essentials are concealed. The epicenter is an example of intransparent transparency. It does show individual sums from donors amounting to €43,130 for2017. Ultimately, however, only 12.6 % of the funds received are declared. The rest is hidden in partly unexplained categories such as donations, sponsoring and grants, foundations.

A similar example of intransparent transparency is the Digitale Gesellschaft from Germany. The income in 2017is explained in only three positions:
– Membership dues, incl. sponsoring membership dues: €51,386.05 €.
– Grants received: €207,941.59
– Donations received: €14,930.26.
The rest you have to find yourself. With donations, which exceed €1,000 in the calendar year, one wants to publish names of the donors and the amount of the donations quarterly on the Website. Where on the extensive side remains unclear.
However, the call for donations in 2018 reports that funds were received from the Open Society Foundation as well as project-related donations from the City of Berlin, the Federal Office for Information Security (BSI) and the Federal Ministry of Justice and Consumer Protection (BMJV). According to the Digital Society, no funds have been received from companies.

But some are even less transparent. In some organizations, for example, only some donors are named, and no amounts are mentioned; e.g. Open Knowledge International.
Four of the 17 participants in Pledge2019.eu, namely Apti, Homo Digitalis, Hermes Center and Xnet, do not disclose any financing at all (or hide it perfectly on their pages).

It remains remarkable to what extent organizations from the USA (associations, foundations and companies) financially support European activists who are actively involved in legislative processes within the EU.

Jörg Weinrich, Volker Rieck

 

Volker Rieck is managing director of the content protection service provider File Defense Service (FDS), which works for numerous rights owners. The company also conducts studies on piracy and supports law enforcement agencies with its collected data. His articles occasionally appear on the FAZ, Tarnkappe.info, Webschauder and sporadically on the US blogs The Trichordist and Musictecpolicy. This is always about the various aspects of unregulated content distribution.

Jörg Weinrich is managing director of the „Interessenverband des Video- und Medienfachhandels in Deutschland e.V.(IVD)“.

 

Guest Post by Iain Baker of @jesusjonesband on the PledgeMusic Situation—MusicTechPolicy

[Used by permission of the artist.  This post is from a series of tweets by Iain Baker of Jesus Jones regarding both their experience being cut off by PledgeMusic and also the implications for the larger music business.]

The music business is fond of winning battles, and losing wars. The best example I can think of is squashing Napster – that victory was anything but – it didn’t hold back the tide of downloads, it merely hastened the rise of streaming.

Above all, it entrenched a generational shift in attitude towards the ownership and transference of digital content. So when the Pledge disaster began to unfold, my first thought was the battle in front of me. How could I get back the thousands of pounds I was owed?

How could Pledge survive, so that I could release more music, in the future, and replicate the successful campaigns we’d created thus far? But, as time passed, my emphasis shifted to the bigger picture, and the war, not the battle.

This was driven by one realisation: what if it happened again? If the site is saved, what’s to stop Pledge just doing it again? What’s to stop them getting another load of money in, and just losing it again? What could stop that? And the answer, sadly – not that much.

I wanted Pledge to be saved – but the chances aren’t high. They’ve apparently got unsustainable debts, huge liabilities, and a board of directors who are – at best – incompetent, and at worst – could possibly be open to allegations of dishonestly and fraudulent mismanagement of funds.

Companies like Pledge are held hostage by VC cash from investors. These investors don’t seem to care whether a struggling songwriter gets a chance to put out a great new record – they just want their investment back, with a profit on top. And I get that – that’s how business works.

But VC cash is flung around in the hope of finding the next big thing – and that need for success comes with a greater need to gamble, and a corresponding disregard for consequences. People poured a lot of money into Pledge, so that Pledge could go out and get more money.

The artistic endeavours that were at the core of Pledge became secondary to the pure profit that could be leveraged. I’m think this hope that investors would see returns is what was driving Pledge’s doomed efforts to grow, exponentially.

I can’t help but think that investing in something like a charity would have been regulated more tightly, ensuring that funds raised were managed effectively, that plans would be in place to ensure realistic growth, whilst still allowing benefactors to be rewarded.

This wouldn’t be an issue, if Pledge were selling biscuits, for example. Trying to sell a great new biscuit, and become the biggest and best biscuit retailer in the world…….

But Pledge was operating in the same way as a Bank, or a building society [or credit union]. They were the custodians of people’s hopes and dreams. In the same way that a bank would take the shoebox of money from under your bed, and say “don’t worry, when you need this, we’ll be there for you.”

But Pledge weren’t there, for anyone. People trusted Pledge, and Pledge didn’t show any of that trust, in return.

The Banking system is held together by trust, and by confidence. But since the financial crisis, it’s been vitally important to underpin that confidence with safeguards, and structures which ensure that banks are protected from contagion and shock to ensure that poor choices cannot threaten people’s trust and security. And this is what needs to happen if we’re going to save Pledge. We need to think about saving the idea of it, and not necessarily the site itself.

For marginalised, struggling artists – or for those who just need to have hope, when traditional lines of business seem closed – a site that offers a way to promote themselves effectively is a godsend.

But the trust which should have kept this system afloat was torpedoed by the very people who were charged with protecting it. We simply can’t let that happen again. We need the business model, but we don’t need the people who ran that business into the ground.

We need a new structure where top-down investment is replaced by community, trust and transparency, growing from the ground, upwards. We need financial safeguards, and guidelines to make sure everyone in the supply chain is protected.

The old model was quick, and easy – some of that simplicity may be lost. Consumer law, and contractual obligations may hamper initial progress, and make the path longer to travel.

But if we’re to try and maintain the vital business model we’ve all come to rely on, then we owe it to ourselves to try and make it work.

When it comes to actually defining this new plan – well, I don’t have the answers. I wish I did. All I know is that if we stick together, and share our communal knowledge, passion, and commitment, we’ll get there.

So – I don’t really know what’s next. If anyone can suggest a way forward, or a way to start putting this into action, I’d love to talk further. You know where I am.

Guest Post: The MTP Podcast: When is a Pledge Not a Pledge? The PledgeMusic crisis

 

Chris Castle discusses the current crisis with PledgeMusic payments.

SHOW NOTES

PledgeMusic: Once a Crowdfunding Haven For Artists, Now Owes them Thousands of Dollars–Billboard www.billboard.com/articles/busines…ds-late-payments

Digital Aggregator Deals: Is the New Boss Worse Then the Old Boss?

musictechpolicy.com/2012/02/01/read…n-the-old-boss/

What is the Difference Between Dischargeable and Nondischargeable Debts in Bankruptcy?

www.nolo.com/legal-encyclopedia…ts-bankruptcy.html

Which Debts are Discharged in Chapter 7 Bankruptcy?

www.nolo.com/legal-encyclopedia…-7-bankruptcy.html

Chapter 11 Bankruptcy for Small Business

www.thebankruptcysite.org/resources/ba…sinesses.htm

Secured vs. Unsecured Debt in Chapter 7 Bankruptcy

www.thebankruptcysite.org/resources/ba…7-bankruptcy

Bankruptcy in the UK

www.gov.uk/bankruptcy

Civil Investigative Demands

www.law.cornell.edu/uscode/text/31/3733

#HiHowAreYou Day in Austin, a Celebration of Daniel Johnston — Artist Rights Watch

Here’s a message from the #HiHowAreYou concert and related campaign.  If you’re not in Austin, you can stream the show from the links below, featuring Flaming Lips, Built to Spill, Gavin DeGraw, Bob Mould and many more.  Please consider showing your support as best you can.
January 22nd is Day – a celebration of the music and art of Daniel Johnston and a day of . We’re celebrating with a free livestream featuring , , Yo La Tengo + many more! Learn more at

Today is the day. We are all doing our part to upend the stigma around mental health issues. Our challenge to you is to connect with someone and actively listen. The conversation starter is easy, yup you guessed it, “hi, how are you?”. Learn more about how to get involved at hihowareyou.org
We’ve got an all-star line up and you’ll have the best the seat in the house. On Jan 22nd we’re live streaming Hi How Are You Day featuring special sets from Gavin DeGrawThe Flaming LipsBuilt to SpillBob Mould, and many more! Tune in for free and rock on for a cause. Check out the lineup and see what we have in store for you: hihowareyou.org#hihowareyou
Tonight, we’ll live stream the performances of , , , & many other artists invited to the concert. The FREE live stream will start at 8pm EST/5pm PST. Follow the link |

 

Guest Post: MTP Podcast: Why Artists Should Care About Data Center Lobbying

Guest post by Chris Castle from Music Tech Policy

Show Notes

Today’s podcast is about the impact on climate of the massive data centers operated in states outside of California and New York by Google, Facebook, Amazon and others.  I focus on Oregon and Nebraska, but there are many other locations.  These massive building projects enable Google to exercise its lobbying muscle in states you wouldn’t expect and on the federal senators and representatives of those states on issues familiar with our old adversary:  Artist rights, profit from human trafficking, drugs and brand sponsored piracy.

Carbon Clouds: Should Artists Ask Why Aren’t Google, Amazon and Facebook in the Green New Deal?

The Mother’s Milk of Algorithms: Google Expands Its Data Center Lobbying Footprint in Minnesota–Home to Senator Amy Klobuchar

Are Data Centers The New Cornhusker Kickback and the Facebook Fakeout?

What’s Up With @SenSasse’s Vicious Little Amendment on pre-72?

Here Comes the Shiv: Sen. Sasse to Move to Strike the CLASSICS Act and Screw Pre-72 Artists

Greenpeace “Dirty Data” research. www.greenpeace.org/archive-interna…-greenpeace.pdf

Nature magazine sums it up (www.nature.com/articles/d41586-018-06610-y):

“Upload your latest holiday photos to Facebook, and there’s a chance they’ll end up stored in Prineville, Oregon, a small town where the firm has built three giant data centres and is planning two more. [Hello, Senator Wyden.] Inside these vast factories, bigger than aircraft carriers, tens of thousands of circuit boards are racked row upon row, stretching down windowless halls so long that staff ride through the corridors on scooters.

These huge buildings are the treasuries of the new industrial kings: the information traders. The five biggest global companies by market capitalization this year are currently Apple, Amazon, Alphabet, Microsoft and Facebook, replacing titans such as Shell and ExxonMobil. Although information factories might not spew out black smoke or grind greasy cogs, they are not bereft of environmental impact. As demand for Internet and mobile-phone traffic skyrockets, the information industry could lead to an explosion in energy use.”

According to the National Resources Defense Council www.nrdc.org/resources/americas…ing-amounts-energy:

“Data centers are the backbone of the modern economy — from the server rooms that power small- to medium-sized organizations to the enterprise data centers that support American corporations and the server farms that run cloud computing services hosted by Amazon, Facebook, Google, and others. However, the explosion of digital content, big data, e-commerce, and Internet traffic is also making data centers one of the fastest-growing consumers of electricity in developed countries, and one of the key drivers in the construction of new power plants.

Google emits less than 8 grams of carbon dioxide equivalent per day to serve an active Google user—defined as someone who performs 25 searches and watches 60 minutes of YouTube a day, has a Gmail account, and uses our other key services.”

In Google-speak “less than 8” usually means 7.9999999999. So let’s call it 8. As of 2016 there were 1 billion active gmail users. So rough justice, Google acknowledges that it emits about 8 billion grams of carbon dioxide daily, or 9,000 tons. And based on the characteristically tricky way Google framed the measurement, that doesn’t count the users who don’t have a gmail account, don’t use “our other key services” and may watch more than an hour a day of YouTube.Upload today,

Don’t Get Fooled Again: Piracy is still a big problem-MusicTech.Solutions

Guest post by Chris Castle (from MusicTech.Solutions)

I know it’s not very “modern,” but music piracy is still a huge problem.  As recently as yesterday I had a digital music service executive tell me that they’d never raise prices because the alternative was zero–meaning stolen.  (This demonstrates the downward effect on prices from massive piracy that David has noted many times on the Trichordist.)

Very 1999, but also oh so very modern as long as Google and their ilk cling bitterly to their legacy “safe harbors” that act like the compulsory licenses they love so much.  Except the safe harbor “license” is largely both royalty free and unlawful.  Based on recent data, it appears that streaming is not saving us from piracy after all if 12 years after Google’s acquisition of YouTube piracy still accounts for over one third of music “consumption.”  The recent victory over Google in the European Parliament indicates that it may yet be possible to change the behavior of Big Tech in a post-Cambridge Analytica world.

It’s still fair to say that piracy is the single biggest factor in the downward and sideways pressure on music prices ever since artists and record companies ceded control over retail pricing to people who have virtually no commercial incentive to pay a fair price for the music they view as a loss leader.  The current thinking seems to be that streaming will save us by having more users subscribe to music services at a price that reflects the market distortion of massive piracy.  In other words, less is more–the revenge of Chris Anderson.  Except now we are to treat the head of the tail as though it were the long tail.

On the other hand, if the Googles of this world were living up to their ethical responsibilities that should be the quid pro quo for the profits they make compared to the harms they socialize, then you wouldn’t see numbers like this chart from Statistica derived from IFPI numbers:

The good news is that there is a solution available–or if not a solution then at least a more pronounced trend–toward making piracy much harder to accomplish.  It may be necessary to take some definitive steps toward encouraging companies like Google, Facebook, Twitch, Amazon, Vimeo and Twitter to do more to impede and interdict mass piracy in return for the safe harbor they love so much and misuse every day.

Private Contracts:  It may be possible to accomplish some of these steps through conditions in private contracts that include sufficient downside for tech companies to do the right thing.  That downside probably should include money, but everyone needs to understand that money is never enough because the money forfeitures are never enough.

The downside also needs to affect behavior.  Getting Google to change its ways is a tall order.  Witness Google’s failure to comply with their nonprosecution agreement with the Criminal Division of the Department of Justice for violations of the Controlled Substances Act.  When the United States failed to enforce the NPA against Google, Mississippi Attorney General Jim Hood sought to enforce Mississippi’s own consumer protection statutes against Google for harms deriving from that breach.  Google sued Hoodand he ended up having to fold his case, even though 40 state attorneys general backed him.

Antitrust Actions:  Just like Standard Oil, the big tech companies are on the path to government break ups as Professor Jonathan Taplin teaches us.  What would have been unthinkable a few years ago due to fake grooviness, the revolving door and massive lobbying spending all over the planet, in a post-Cambridge Analytica and Open Media world, governments are far, far more willing to go after companies like Google, Amazon and Facebook.  At least in Europe where fines against Google for competition law violations exceed $5 billion.

Racketeer Influenced and Corrupt Organizations Act Civil Prosecutions:  “Civil RICO” claims are another way of forcing Google, Facebook, Amazon & Co. to behave.  Google is fighting a civil RICO action in California state court.  Civil RICO may be a fertile solution against one or more of Google, Facebook and Amazon.

As we know, streaming royalties typically decline over time due to the fact that the revenues to be divided do not typically increase substantially (and probably because of recoupable and nonrecoupable payments to those with leverage).  At any rate, the increase in payable revenues is less than the increase in the number of streams (and recordings).

While it’s always risky to think you have the answer, one part of the answer has to be basic property rights concepts and commercial business reality–if you can’t reduce piracy to a market clearing rate, you’ll never be able to increase revenue and music will always be a loss leader for immensely profitable higher priced goods that artists, songwriters, labels and publishers don’t share be it hardware, advertising or pipes.

I strongly recommend Hernando de Soto’s Mystery of Capital for everyone interested in this problem.  The following from the dust jacket could just as easily be said of Google’s Internet:

Every developed nation in the world at one time went through the transformation from predominantly extralegal property arrangements, such as squatting on large estates, to a formal, unified legal property system. In the West we’ve forgotten that creating this system is what allowed people everywhere to leverage property into wealth.

What we have to do is encourage tech companies to stop looking for safe harbors and start using their know-how to encourage the transformation of the extralegal property arrangements they squat on and instead accept a fair rate of return.  My bet is that this is far more likely to happen in Europe–within 30 days of each other we’ve seen Europe embrace safe harbor reform in the Copyright Directive while the United States welcomed yet another safe harbor.

If we’re lucky, the European solution in the Copyright Directive may be exported from the Old World to the New.  And if Hernando de Soto could bring property rights reform to Peru in the face of entrenched extralegal methods and the FARC using distinctly American approaches to capital, surely America can do the same even with existing laws and Google.

Content Creators Coalition & MusicAnswers Applaud the Revision and Passage of the Music Modernization Act by the Senate Judiciary Committee — Artist Rights Watch

[A brief word–TheTrichordist and MusicTechPolicy are always there to provide a platform for the songwriters, artists, musicians and vocalists when grassroots needs to be heard.  We all have to thank the Content Creators Coalition, MusicAnswers and especially Maria Schneider for enduring the tactics used against them in their unwaivering fight for fairness and transparency for the creator community.  The good protective changes to MMA in Senate Judiciary are due to their efforts and the kind willingness of Senators Grassley and Feinstein to listen to compelling ideas presented by effective advocates.

We also thank all of our readers and supporters for helping to get the word out and taking action.  We would be nowhere without you.  If MMA passes, the collective’s operations will require hyperdiligence from the grassroots creator community around the world, so we commit to keeping the heat on for fairness, transparency and honesty.  In the end, the example set by these brave leaders C3, MusicAnswers and Maria teach us that community is the oversight.  We commit to doing our share of these future tasks and then some if called upon.  We invite you to do the same.]

PRESS RELEASE

[Washington, D.C.] – The Content Creators Coalition and MusicAnswers released today the following statement on the Senate Judiciary Committee’s vote in support of the Music Modernization Act.

C3 and MusicAnswers applaud the Senate Judiciary Committee’s vote to advance the Music Modernization Act, while incorporating key changes we had urged to make the legislation stronger, more transparent, and more equitable.

The MMA will strengthen the music ecosystem and all its participants, including songwriters, publishers, performing rights organizations, artists, record companies, music services and fans. It ensures digital music services will pay fair royalties for every song they stream, establish a better standard for determining royalty rates, and eliminate some out-of-date provisions of the PRO consent decrees. In return, digital music services get certainty, legal protection, and new streamlined tools to bring more music to more people at lower cost.

It’s a reasonable bargain, and, therefore, we have consistently and publicly supported the basic construct of the legislation.

We are especially grateful that the Senate Judiciary Committee, led by Chairman Chuck Grassley (R-IA) and Ranking Member Dianne Feinstein (D-CA), was willing to engage with our organizations on ways to improve the bill and include in the Managers Amendment approved today key protections for creators and the public.

As a result, the MMA now provides greater transparency, including rigorous audits to make sure that royalties are flowing to the correct parties, a commitment to educating all music creators about their rights and the royalties due them collected under the new Music Licensing Collective (MLC), a requirement to study and follow best practices in order to find the proper owners of unclaimed royalties, and increased clarity regarding who owns the data generated by the new system.

While we support the legislation and are proud of the changes we have achieved as artist and songwriter advocates, we continue to have concerns about three key issues: whether the entity that is designated as the MLC is being foreordained by the bill and precludes competition with the MLC; the composition of the Board of Directors of the MLC, which is unduly tilted towards major publishers; and the methods used to distribute royalties from works where even using best practices the authors could not be identified.  We urge the full Senate and the House to consider further improvements to those flawed provisions and we call on the Copyright Office to ensure in implementation of the final legislation that no stakeholder group can dominate the MLC and that all royalties are distributed in a fair and equitable and non-self-interested manner.

The process leading to this moment has been strong in many ways. But it has also included its fair share of divide-and-conquer tactics and efforts by powerful incumbent forces to crowd out grassroots organizations like ours and to divide the music community within itself.  We believe that we are strongest when we respect and support each other – a lesson too many in our business still have yet to learn.

We are deeply appreciative of the partnership c3 and MusicAnswers have forged. Together, we represent thousands of writers, producers, performers, and music business professionals, and over the past few weeks we have worked steadfastly to pursue improvements in the MMA. We look forward to future collaboration and welcome the involvement of other collaborative groups and individuals.

via Content Creators Coalition & MusicAnswers Applaud the Revision and Passage of the Music Modernization Act by the Senate Judiciary Committee — Artist Rights Watch

@soundexchange: SXWorks Announces New Services for Music Publishers and Songwriters — Artist Rights Watch

PRESS RELEASE

 

JUNE 12, 2018

SXWorks Announces New Services for Music Publishers and Songwriters

NOI Premium Expands on NOI LOOKUP Tools

WASHINGTON, DC – June 12, 2018 – SXWorks, a subsidiary of SoundExchange, today announced that it has developed two new services to expand upon NOI LOOKUP, the innovative new tool launched in January to help music publishers and songwriters search the more than 70 million address unknown Notice of Intention to Use (NOI) filings made with the U.S. Copyright Office.
NOI Premium Services, available beginning today from SXWorks, will give publishers and songwriters more opportunities to claim unpaid mechanical royalties from digital service providers (DSPs) and facilitate communication for creators with DSPs and the Copyright Office.

“Development of NOI Premium Services is a direct result of interest in our NOI LOOKUP service and the demand for more services from the publishers who use NOI LOOKUP,” said Michael Huppe, Chairman of the Board of SXWorks. “Since the introduction of NOI LOOKUP, songwriters and publishers have asked us to advance our efforts to help them get paid fairly and accurately.”

The new NOI Premium Services unveiled today are Works Claiming and Recordation.

Works Claiming helps publishers submit ownership claims and works shares to a digital service provider (DSP) for its use of a musical work. NOI Premium Services customers upload their works claims to SXWorks. SXWorks then sorts, formats and aggregates the uploaded file and forwards the rights owner’s claim and information to the proper contact at the DSPs identified by the publisher that filed NOIs for the musical work in question. A flat fee of $100 covers the cost of submitting up to three Works Claiming spreadsheets during a one-year period, each with up to 500 titles listed.

Recordation services take the Works Claiming tool a step further. If a songwriter or publisher requests the Recordation service, SXWorks will facilitate submission of the proper information and documents to the Copyright Office so the Office’s records are current and DSPs can locate a publisher’s contact information and ownership data. The recordation fee is $75 per submission plus fees charged by the Copyright Office.

“These new services represent the next step in the evolution of NOI LOOKUP. We know that giving publishers more control by creating new tools will help us chip away at the problem surrounding NOIs and unpaid royalties,” Huppe said. “It’s also important to note that NOI LOOKUP and NOI Premium Services represent the latest innovation – following our International Standard Recording Code (ISRC) Search and our new Music Data Exchange (MDX) program launched last month – to help publishers and songwriters by bringing transparency and efficiency to the music industry.”

To learn more about the new Works Claiming and Recordation services, read our FAQs here.

About SXWorks
SXWorks provides global services to music publishers to support multiple licensing configurations. SXWorks, a subsidiary of SoundExchange, is governed by a board consisting of leading music publishers and SoundExchange executives. SXWorks was created in conjunction with the 2017 acquisition of the Canadian Musical Reproduction Rights Agency Ltd. (CMRRA). CMRRA represents the mechanical rights of music publishers and administers the majority of songs recorded, sold and broadcast in Canada.

via @soundexchange: SXWorks Announces New Services for Music Publishers and Songwriters — Artist Rights Watch

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