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.

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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.

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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)“.

 

Cloudflare: The Bad, The Worse and The Criminal? @GoldmanSachs @USTreasury #OFAC

Translated from German.  Original here.

Cloudflare: The bad, the worse and the criminal

In the US, a large technology company is about to go public. Cloudflare, a San Francisco-based company, wants to collect nearly $3.5 billion on the stock exchange in the first half of the year with the support of the investment bank Goldman Sachs. But there are dark shadows over Cloudflare. The spectrum of its customers ranges from credit card fraudsters and spammers, to sites that engage in copyright infringement as a business model, to terrorist sites. Even US embargos are undermined.

What is Cloudflare?

Cloudflare offers a content delivery network.

In simple terms, it provides a kind of turbo drive for web pages, allowing them to be delivered world-wide quickly and securely. Cloudflare places itself between, on one hand, the web page and/or servers of its customers and, on the other, the site visitor and/or user of the service. By enabling it to selectively control and distribute site traffic, it can offer increased speed and protection against network overload attacks (DDoS).

However, Cloudflare also offers another feature: anonymizing its customers.

By placing a virtual screen over the original web page and/or their server, Cloudflare makes the operator practically untraceable. Upon inquiry, Cloudflare will only provide its own data, hiding client information such as hosting service and IP address, making it impossible to take legal action against illicit sites and services.

Civil law inquiries are futile, because Cloudflare only provides the naming of the hosting services, which is worthless without the respective IP address. This is roughly equivalent to seeking info on an unmarked apartment with just the address of a high-rise building housing thousands of residents.

The Cloudflare problem is well known

This anonymizing feature from Cloudflare attracts a number of unsavory customers including, again and again, copyright infringers.  But it doesn’t stop there.
Since December 2018, the EU Commission has included Cloudflare on a watch list for counterfeiting and piracy. Most recently, the service received the dubious prize as the worst enemy of the creative community from the US blog TheTrichordist.

The listing of infringing market participants has a long history in the US.
The music association RIAA submits an annual list of the worst offenders to the US Department of Commerce. In 2017, 9 out of 20 violators could not be identified by the RIAA because Cloudflare effectively camouflaged them.
The US film association MPAA is also aware of the problems with Cloudflare obfuscation and names the company in its annual list of interferers.

In the relatively new piracy segment IPTV – the streaming of non-licensed TV signals – the company is also on the move. A study from Fall 2018 shows the role of Cloudflare both in camouflaging the sites that sell IPTV subscriptions and in concealing the origin of the streams.

In a survey of data centers comprising file and streaming hosts in 2016, 40% of the Top 10 and 47% of the Top 30 used Cloudflare.
The ECO, a German association, which obviously doesn’t care about anything

 

Cloudflare is a member of the German industry association ECO. The purpose of this membership is probably to get a discount for traffic at the Frankfurt (DE-CIX) internet node, which ECO operates through a subsidiary.
ECO has never seemed to care that providers who are very heavily involved in piracy, including Cloudflare, are members of the association. In any case, there was no reaction to corresponding reports that ECO members, including Cloudflare, are responsible for over 50% of piracy traffic in the film sector in 2014, with 45.2% of this activity accounted for by Cloudflare and around 6% by a further five members.

Cloudflare Picture1.png

Screenshot: Extract from the ECO member list, February 2018,

www.eco.de/ueber-eco/mitglieder/#C

Cloudflare in court

The reports of legal proceedings against Cloudflare are long and concern more than just virtual goods. For example, two manufacturers of bridal fashions filed suit for trademark and copyright infringements by plagiarizers who were made anonymous by Cloudflare. And, while a claim brought by adult entertainment provider ALS-Scan ultimately ended in settlement, the judge found that Cloudflare’s activities could significantly support copyright infringement by hosting cached copies of files (though the settlement precluded a final judgment on Cloudflare’s actions and liability).

Supporting Illegal Activity: Calculated or Coincidence?

In Fall 2018, Cloudflare made news by ending its business relationship with pirate hosts like Rapidvideo due to violating its terms of use. Such action begs the question: is the service being cleaned up in anticipation of the IPO or are these just insignificant and cynical platitudes? After all, before this,  Cloudflare had only voluntarily terminated its business relationship with US Nazi site the Daily Stormer in 2017.

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Screenshot Youtube Video with Cloudflare CEO Matthew Prince on Fox Business Network

Big Data brings it to light

The current Google Transparency Report offers a look at the actual extent of Cloudflare’s involvement in piracy.
In the report, Google lists all requests from rights holders for deletions from the Google search index that concern rights violations.

In order to understand the importance of Cloudflare to the market, the 5,000 domains that are inactive sites parked with companies such as Team Internet, Sedo or GoDaddy but still protected by Cloudflare have to be subtracted from the 5,000 domains.

This leaves 3,645 domains. Of these 3,645 right-infringing sites, 41.9 % run via Cloudflare. For their part, they are responsible for 44.7 % of the copyright infringements reported to Google.

If one were to extrapolate this proportion to the total number of domains listed in the Google Report for copyright infringements, one would come up with almost 670,000 domains protected by Cloudflare – a significant portion of the 2.2 million domains with requests for delisting from Google’s search engine.

 

Among Cloudflare’s customers are:

Torrentz.eu, Gosong.net, Share-online.biz, Catshare.net, Bitnoop.com, Deepwarez.org, Turbobit.net, Myfreemp3.eu, and Nitroflare.com.

Each of these websites received at least 3 million deletion requests from the Google search index.

Not only pirates love Cloudflare – also credit card fraudsters, phishing sites, extortionists, and terrorists

The Watchwebsite Crimeflare is a real treasure trove of information about Cloudflare, liisting650 credit card fraud sides alone, to which Cloudflare offers shelter.

 

Cloudflare also proudly deals in SSL certificates, providing sites like Phishingseiten the manufactured consumer security and confidence-building necessary to be successful. According to the German magazine Heise, hundreds of such certificates for cheats were issued by Cloudflare.

Of course, as Spamhaus reports, the spreading of Malware often takes place over Cloudflare.

With Cloudflare, extortion is also par for the course, which conveniently generates additional services. By providing anonymity and untraceability to sites threatening, for example, to bring a web page to a standstill through DDoS, Cloudflare can then sell the attacked site its protection services.
A truly special form of customer acquisition.

Cloudflare has also found good business in terror.

As far back as 2012, the news agency Reuters confronted Cloudflare with the fact that it maintained the websites of Hamas and Al-Quds, designated by the US as terrorist groups.
In 2015, a petition against Cloudflare in the US highlighted that the service offered shelter to about 50 websites attributed to ISIS.
And in 2018, terrorist organizations were still being supported, with Dutch security researcher Bert Hubert identifying at least 7 different terrorist organization websites that use Cloudflare.

The Huffingtonpost had these findings evaluated by Benjamin Wittes, Senior Fellow of the Brookings Institution:

“This is not a content-based issue. Cloudflare] can be as pure-free-speech people as they want – they have an arguable position that it’s not their job to decide what speech is worthy and what speech is not – but there is a law, a criminal statute, that says that you are not allowed to give services to designated foreign terrorist organizations. Full stop.”

As icing on the cake, the company even has customers who are on the official embargo list of the US (SDN list). For example, CENTRAL REPUBLIC BANK from the Donetsk region uses Cloudflare’s services.

Cloudflare Picture3

Screenshot: Collage of information from theUS Treasury’s Office of Foreign Assets Control
https://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx

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Screenshot: Whois record of crb.dnr.ru at February 18th2019

Do investors actually know what they are investing in?

Against the background of all these facts, two things are worth considering:

1) How has Cloudflare been able to obtain financing rounds from various investment companies in the past, including Google’s parent Alphabet?

2) Does Goldman Sachs actually know anything about the extent of its involvement in rights violations and its support of dubious “ventures,” even to the point of undermining US embargoes?

Risk management is one of the central parameters of investment banks when evaluating investments. Risks must be known and assessable in advance. Cloudflare’s considerable participation in dubious transactions is rare in an IPO and a huge risk. Particularly if, as in the ALS-Scan case, the company is faced with its own liability, or if criminal law is violated through the service’s business with terrorist organizations.

Goldman Sachs and current investors either lack moral standards, are naïve, or consider the risk of failure to be very low, which only shows how urgently we need government regulation of intermediaries on the Internet.

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.

EU Tech Lobbying: Tricks-Camouflage-Deception

 

<Editors note   Original German Version of this article here. http://webschauder.de/tricksen-tarnen-taeuschen/  We appreciate Volker connecting the dots for us in the increasingly murky lobbying campaign by Google against Article 13.  The counter-narrative has already started–Google is using cherry-picked facts to try to make Members of the European Parliament believe that they are being outlobbied by artists, songwriters and journalists.  This conveniently overlooks the millions Google has spent in Europe trying to influence public opinion and, of course, the Google revolving door.  It’s also hard to believe that Google’s lobbying on its competition law fines had no affect on its lobbying against Article 13.:>

Tricks – Camouflage – Deception

Facebook makes you sit up and take notice. The British former Deputy Prime Minister Nick Clegg, a new Head of Global Affairs for Facebook, was barely introduced when he made his first interesting public statements. “Regulation is not so bad,” Clegg told the Financial Times. As a former senior member of the government, presumably this comes naturally to Clegg because he simply knows it from his work.

Clegg made another surprising yet unsurprising statement on the subject of campaigns. In light of the possible influence of Facebook advertising on elections, Clegg promised that future campaigns on Facebook would be clearly labeled, for example, “Paid for by….”

Facebook is somewhat ahead of the EU in this respect, which is currently making efforts to do something about disinformation—especially in view of the EU election in May 2019.

This includes Brussels demanding monthly updates from Internet companies such as Google or Facebook, in which they must present what they have actually done to counter disinformation by, at a minimum, providing greater transparency. We will see whether this effort to promote greater transparency is successful, and one might be forgiven for having doubts based on past performance, but evolution is an agonizingly slow process.

Other tech lobby groups go the other way…

The Saveyourinternet.eu campaign takes a completely different approach masked in lack of transparency. As described in detail in earlier articles, the website played a central role in the attempted manipulation of EU parliamentarians by mail avalanches and Twitter storms in the summer of 2018.

The website was registered at the time by the lobby company N-Square from Belgium, which also does work for Google.

If you look at the current registration data for the website, you will see that the site is now anonymous. The French company Gandi SAS is used for this purpose, which conveniently and effectively disguises the true name and other data of the registrant.

 

Saveyourinternet.eu whois

Illustration: WhoIs of Saveyourinternet.eu at EURID

 

So it is not clear who is responsible for the page, because even a close examination of the page itself is anything but illuminating. There is a note indicating that the organization EDRi manages the site, but that does not meet the requirements of the E-Commerce Directive which requires a legal notice identifying a responsible person and address.

Edri management of the site .png

Illustration: Notes on the management of the site by EDRi

Family Business

One can only speculate about the reasons why EDRi has jumped into the breach here.

Maybe N-Square and its managing director, Caroline De Cock, wanted to get out of the line of fire after the response to its action against the MEPs from summer 2018.

However, presumably through oversight, the registration data for other websites involved in the campaign against the EU copyright reform have not been anonymized, although their look and feel is very similar to that of the Saveyourinternet site.

Fixcopyright.eu e.g. still has registration data of Ms De Cock and her parent company KDC Group and it may only be a matter of time before this page is also anonymized.

Fix copyright. eu registration.png

You also won’t find any necessary legal notice data on the FixCopyright site. If you follow their Privacy Policy, it forwards you to Create-Refresh, a commercial campaign site operated by the consulting company, Purpose Campaigns LLC from the USA. Create-Refresh has itself been incessantly banging the drum against the new EU Copyright Directive since the summer, including through the placement of banner ads on Twitter, for example.

And it also must be said that the partners of Create-Refresh parent company, Purpose Campaigns LLC, include, among others, Google and the Ford Foundation.

List of Partners at Purpose Campaigns LLC

Illustration: List of Partners at Purpose Campaigns LLC


Fixcopyright.eu therefore violates the E-Commerce Directive as well as saveyouinternet.eu!!

In addition, there are no data protection notices in accordance with the DSGVO, which has been in force in the EU since May 2018. Visitors to the site are redirected to the Twitter accounts of MEPs, for example, but they are not informed of this in any privacy notices, which of course also apply to so-called civil society groups.

In the end, however, these anti-Article 13 sites remain a kind of family business.

If one superimposes the financiers of EDRi and Copyright4Creativity, which is still managed by Caroline de Cock, or Purpose Campaigns, there are interesting intersections, be it the Open Society Foundation or the Ford Foundation. These two foundations alone accounted for almost 37% of EDRi revenues in 2017.

Even more exciting is the list of other EDRi donors.

One of them is Mozilla, who is known for financing Open Media, the company that via its subsidiary New/Mode provided the tools for the attack on the offices of members of parliament in the summer of 2018.

Open your wallets

Another donor is Wikipedia Germany.

Anyone who visits Wikipedia from October onwards will hardly be able to escape the appeals for donations. This was of course also the case in 2018.

wikipedia germany.png

Illustrations: Donation appeal from Wikipedia Germany in autumn 2018 as well as the thank you message, banner from the Wikipedia Germany page.

Wouldn’t it be more honest in the course of such appeals for donations to say that a large part of the money collected in Germany is thrown into the big pile of money that Wikipedia has in the USA and currently amounts to more than 120 million dollars?  (An amount for which one could probably finance the online encyclopedia for years to come.)

How this is compatible with Wikipedia’s non-profit status in Germany is another question that I will leave to another day.

Against this background, the statements made by John Weitzmann of Wikipedia Germany deserve further scrutiny. At a copyright congress in Berlin in November 2018, in front of roughly 250 people, Weitzmann declared that Wikipedia had never supported http://Saveyourinternet.eu . Apparently, he had, or has, a hard time distinguishing fact from fiction as this was clearly untrue. Or perhaps he was misled by Wikipedia and Saveyourinternet’s own disinformation campaign—a campaign itself rooted in obfuscation.

Of course, the picture of deception is incomplete without considering the role of Julia Reda, the only member of the Pirate Party in the EU Parliament. Ms. Reda has been very busy promoting a meme generator on Twitter apparently clinging to the myth that the directive restrict memes. Putting aside the fact that memes are not affected by the directive (and so every meme is compliant with the directive) it is highly instructive to observe the provenance of this CreateRefresh tool so favored by Ms. Reda! Part of the campaign is paid by Purpose Campaigns LLC, which as noted earlier, also lobbies for Google. So the circles are closing here as well.

julia reda tweet.png

Illustration: Screenshot of Julia Reda’s Twitter account

It will be interesting to see how the EU reacts to all these interconnected relationships.

Commissioner Mariya Gabriel was presented with comprehensive documentary evidence in Strasbourg at the beginning of December, which presents and proves the background of the non-transparent campaign against the EU, undertaken in conflict with the requirements of existing EU legislation.

Changes such as the changes to the Saveyourinternet.eu website indicate that the campaign operators are apparently becoming aware of the terrain they have entered and seems to be evidence they are distancing themselves.

It will be interesting to see how the EU reacts to all these events.
Commissioner Mariya Gabriel was presented with comprehensive documentary evidence in Strasbourg at the beginning of December, which presents and proves the background of the non-transparent campaign against the EU, undertaken in conflict with the requirements of existing EU legislation.
Revisions such as the anonymizing changes to the Saveyourinternet.eu website indicate that the campaign operators are apparently aware of the terrain they have entered.

Volker Rieck is managing director of the content protection service provider FDS File Defense Service, which works for numerous rights owners. The company also prepares studies on piracy and supports law enforcement companies with the data it collects.
Volker Rieck blogs regularly on Webschauder and from time to time on the US blog The Trichordist on various aspects of unregulated content distribution. His articles also appear on Tarnkappe.info and in the FAZ.

2018 Streaming Price Bible! Per Stream Rates Drop as Streaming Volume Grows. YouTube’s Value Gap is Very Real.

Here we go again. To see previous years, click [here].

This data set is isolated to the calendar year 2018 and represents a mid-sized indie label with an approximately 250+ album catalog now generating almost 1b streams annually. 2018 is the year we saw streaming truly mature as the dominant source of recorded music revenues.

In parsing the data provided we find that digital revenues are 86% of all recorded music revenues globally (RIAA Reports Digital Revenues as 90% of Total). Streaming is 80% (or more) of Digital Music Revenues. Downloads are about 20% of digital music revenues for the year, however if we isolate Q4, it would appear download revenues could be less than 15% of digital revenues. The transition from downloads to streaming is well beyond the tipping point and we wonder how long the major services (Apple, Amazon, Google) will continue to support the format.

As we dig down into the physical revenues much of the gross is eroded by manufacturing, shipping and inventory costs of both CDs and Vinyl. In short, the recorded music business is now the streaming music business. Whatever charm there is to vinyl, it is at best still a truly niche business in terms of meaningful net revenues.

Every year there are surprises in the data and this year is no exception. As always we present this data as a single sample, but one we feel is fairly representative of the state of the business. As such, we welcome comments from others with access to similar data to report on their findings. Some of the percentages may vary dependent upon the genre of music and the size of the label or artist. However, we generally don’t find trends that are completely contradictory to our sample where it matters most, in reporting on stream rates and relative marketshare.

We’ve also simplified the chart this year. Just one chart, and only the Top 20 streamers which represent  99.35% of all streaming dollars. The Top 10 streamers account for over 97% of all music streaming revenues. The Top 5 account for over 88% of all streaming dollars. What we see below is a maturing marketplace with a small number of dominant players. Anyone who thought the digital revolution would remove so called “gate keepers” are painfully wrong.

If you want to compare these numbers against the RIAA’s official report for the first half of 2018, click [here]. That data is for the USA and only through June of 2018. It’s hard to get “apples to apples” reporting, so everything should be taken as different perspectives on the overall business. If you are an artist or label, see how your own data compares.

The biggest takeaway by far is that YouTube’s Content ID, (in our first truly comprehensive data set) shows a whopping 48% of all streams generate only 7% of revenue. Read that again. This is your value gap. Nearly 50% of all recorded music streams only generate 7% of revenue.

 

The Spotify per stream rate drops again from .00397 to .00331 a decrease of 16%. Apple Music gains almost 3% for an total global marketshare of about just under 25% of all revenue.

Apple’s per stream rate drops from .00783 to .00495 a decrease of 36%. We need to state again, that 2018 saw a massive shift of revenues from downloads to streaming and no doubt this expansion of scale, combined with more aggressive bundling (free trials) as well as launching into more territories was bound to bring down the overall net per stream.

Apple Music still lead in the sweet spot with about 10% of overall streams generating 25% of all revenue (despite the per stream rate drop). Spotify by comparison has nearly triple the marketshare in streams than Apple Music but generates less than double the revenues on that volume.

The biggest takeaway by far is that YouTube’s Content ID, (in our first truly comprehensive data set) shows a whopping 48% of all streams and only 7% of revenue. Read that again. This is your value gap. Nearly 50% of all recorded music streams only generate 7% of revenue. Apple Music and Spotify combined account for just short of 40% of all streams and 74% of all revenue.

We don’t know how the powers that be at the major labels can continue to allow for this gross inequity. It will be interesting to see how YouTube Red numbers evolve over this year. YouTube Red, the newly rebranded version of the disastrous “Music Key” is off to a slow start in a competitive subscription music marketplace. One has to ask, what incentive is there really for Google/YouTube with the Red subscription service when they already benefit from service 48% of all streams while paying only 7% of the overall revenue?

In looking at the per stream rates for song and album, you might want to read this article by Billboard on the current calculation of how many streams equal and album for the purposes of charting. We don’t know if YouTube Content ID streams count towards charting, but they absolutely should not. The report states that, “The Billboard 200 will now include two tiers of on-demand audio streams. TIER 1: paid subscription audio streams (equating 1,250 streams to 1 album unit) and TIER 2: ad-supported audio streams (equating 3,750 streams to 1 album unit).”

In the coming year Amazon’s Unlimited Music service shows promise. We also wonder about Google Play. The payouts on Google Play are fair, but when bundled into the YouTube ecosystem is largely inconsequential in terms of both streams served and revenue. As smart home assistants grow there could be a larger market segment for paying subscribers to have streaming music catalogs available and on demand.


These numbers are from one set of confidentially supplied data for global sales. If you have access to other data sources that you can share, we’d love to see it.

  • HOW WE CALCULATED THE STREAMS PER SONG / ALBUM RATE:
  • As streaming services only pay master royalties (to labels) and not publishing, the publishing has to be deducted from the master share to arrive at the comparable cost per song/album.
  • $.99 Song is $.70 wholesale after 30% fee. Deduct 1 full stat mechanical at $.091 = $.609 per song.
  • Multiply the above by 10x’s and you get the album equivalent of $6.09 per album
[EDITORS NOTE: All of the data above is aggregated. In all cases the total amount of revenue is divided by the total number of the streams per service  (ex: $5,210 / 1,000,000 = .00521 per stream). In cases where there are multiple tiers and pricing structures (like Spotify), these are all summed together and divided to create an averaged, single rate per play.]

[royalties][streaming royalties][music royalties][royalty rates]

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,

Pro-Piracy Law Professor Appointed Justice Minister of Canada, Attorney General

David_Lametti,_Parliamentary_Secretary_to_the_Minister_of_Innovation,_Science_and_Economic_at_the_Creative_Commons_Global_Summit_2017_(33940702440)_(cropped).jpg

David Lemetti, pro piracy law prof now Canada’s Minister of Justice.  Photo by Wikimedia commons. 

You can’t make this shit up.

In cabinet shakeup Justin Trudeau has appointed David Lametti as Minister of Justice and Attorney General. We are very familiar with Lametti and this dude is very bad news for artists, authors, filmmakers and performers.

Lametti isn’t just a copyright skeptic he is for the legalization of piracy.   A quote from his 2011 paper The Virtuous P(eer): Reflections on the Ethics of File Sharing

“Sharing is thus a key practice linked to virtue, and not necessarily to vice. I shall make an argument, again particularly with regard to music, that such a sharing ethos has always been part of the way that music has been written, performed and appreciated. Finally, I shall argue that current normative structures ought to be adapted to reflect this more profound understanding of the impulse to share music.”

What he means by that all this is

  1. sharing is caring
  2. we should change the law to legalize piracy cause that’s what the kids are doing.

Oh but there is more. So much more. In the same paper, after making a half assed economic argument that file-sharing doesn’t cause much economic damage,  he says this:

“In addition to these economic arguments, I wish to bolster the argument that the sharing of music files is – if not absolutely justified in all circumstances – at least justifiable in many circumstances.”

Finally I’ll leave you with this little nugget on the  ethics of copyright infringement:

“Indeed, there is a sense in which one can even disregard, in principle, certain rules while remaining faithful to the law.”

Remember this is the #1 law enforcement officer in Canada now. He advocates breaking the law.

“War is Peace”

“Freedom is Slavery”

“Breaking the Law is remaining faithful to the law”

What a train wreck.  I genuinely feel bad for all Canadian artists.

 

 

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