The Nature of Collective Licensing

Music Technology Policy

The main reason why it is profitable to establish a firm would seem to be that there is a cost of using the price mechanism. The most obvious cost of “organising” production through the price mechanism is that of discovering what the relevant prices are. This cost may be reduced but it will not be eliminated by the emergence of specialists who will sell this information. The costs of negotiating and concluding a separate contract for each exchange transaction which takes place on a market must also be taken into account.  Again, in certain markets, e.g., produce exchanges, a technique is devised for minimising these contract costs; but they are not eliminated. It is true that contracts are not eliminated when there is a firm but they are greatly reduced.

The Nature of the Firm by R.H. Coase, Economica (1937) 386 at 390-91.

Buy Low, Sell High

Maybe you’ve…

View original post 2,038 more words

by thetrichordist

Trichordist Office Betting Pool: How Many Days Until Google and EFF File Amicus Briefs in “PopcornTime for Music” Lawsuit

IMG_6937

 Google and EFF amicus brief betting pool is being organized at the Trichordist offices in California. 

Yesterday major labels filed suit against the unlicensed music downloading service Aurous,  The company has been called “Popcorn Time for Music” because of the ease with which it allows users to download music from bittorent tracking sites.  More accurately Auros is simply an unlicensed Spotify. That is it provides exactly the same service that Spotify provides but it doesn’t bother getting licenses or paying artists.

Now in the past when we see cases like this, usually within a matter of weeks we see Google and EFF file amicus curiae  briefs on behalf of the defendants.   In fact this blog has rarely seen a piracy case in which Google and EFF haven’t weighed in on behalf of the infringing site.  Now we always expect this serial enabling of artist exploitation sites from the EFF.  Because let’s face it, the EFF has become an anti-civil rights organization.  The EFF seems to always find commercial websites have “rights” that supersede those of the individuals they abuse. No matter how heinous these sites. That’s why the EFF  stoops to defending REVENGE PORN websites (a form of sexual assault) as a form of “speech.” What’s next EFF, child porn sites?

But Google should be cool right?   I mean they are our partners right?  They have Google Play and YouTube. They love musicians, film makers and other creators.   We’re all on the same side right guys?

Nope. Nope. Nope. Nope. etc etc etc

Any questions? What’s that I can’t hear you entertainment industry?   Oh I understand, it’s kind of hard to speak clearly with that Google brand knife in your back. How did that get there?

++++++++++++++++++++++++++++++

So the count down begins.  How many days till Google and EFF file their amicus briefs in this case?   Since October has 31 days the pool will work using modulo 31 math.  For civilians that means we will roll over to 1 at day 32.   The pot is currently up to $24 dollars! You know about the size the typical check from a legal streaming service.

Finally, why is it that none of the streaming services like Spotify or Pandora file amicus briefs on behalf of rights holders and artists?  I mean Aurous competes directly with both of these services.  It seems like they have as much at stake.  And we are friends right?  Perhaps it’s because they aren’t really our partners at all?   That indeed they don’t give a shit about artists and rights holders?   I’d love to see one of the labels ask their partners Daniel Ek or Tim Westergren this question.

by Dr. David C Lowery

The Truth About Vinyl And Streaming – And It Is Not Pretty…

vinylcu

There’s a romanticism about vinyl, and we share that enthusiasm of the format for obvious reasons. However it should be noted that the romanticism that surrounds vinyl, is largely that- romanticism. Below we’ve assembled a number of recent editorials and reports about the state of vinyl production to shed some light and much needed perspective on this subject.

There several important take-a-ways from our friends who are on the front lines of vinyl production that are also noted in the reports below.

1) Vinyl revenues are grossing more than free streaming receivables. This sounds impressive at first but said another way it means that free streaming is just not generating a lot of revenue in the aggregate of the total business (not a surprise, free streaming is a big problem).

Second, and more sadly is the fact that vinyl production is very expensive and miscalculations on selecting a title or the pressing quantity almost certainly will create a loss in thousands of dollars (if not tens of thousands) per title. In other words NET PROFITS on vinyl are pretty small in relationship to the GROSS REVENUE generated at retail due to the excessively high manufacturing costs.

2) Turn around times to make vinyl have been pushed out in excess of six to nine months on most indie label titles.  If the major labels want to dominate the presses then they should invest in helping to create more pressing plants and overall pressing volume. There are only so many titles that can survive a demand curve that extends more than half a year from when there was initial excitement. This means titles that could have sold through their pressings often end up as excess inventory.

3) Good test pressings are fewer and farther between. Many test discs are often inferior and unlistenable. Problems range from pops and clicks, and surface noise to outright skipping. Getting an acceptable pressing can often mean rejecting two or three test pressings before all sides of an album are approved. A CD length vinyl release requires four vinyl LP sides that must be approved before the album can be commercially pressed. Each rejected side adds four to six weeks to the overall production timeline.

4) Colored novelty vinyl sucks as a listening experience. So much of the custom vinyl being released on colored vinyl and specialty blends sound completely horrible. These are purchased by consumers more or less as merchandise (we hope) more than they are audio products. There are a lot of not great sounding new vinyl releases, but hey if it’s on rainbow splatter glow in the dark vinyl who cares, right?

All of this is to say that if anyone thinks that vinyl is the solution to the economic exploitation artists are facing from free streaming models, then they just don’t understand the mechanics of the contemporary vinyl marketplace.

Read on…

Pressed to the Edge: Why vinyl hype is destroying the record | FACT
“There are only two companies worldwide that produce lacquers. One of these companies is a one-man operation in Japan run by an old man who produces the lacquers in his garage. It’s excellent quality, but who knows how much longer he can and especially will want to continue to do this. When we are in contact with him, we attempt to order as many lacquers as we can in order to stock up as much as possible. You don’t really know when you will reach him again. The other company is in the USA and serves a large portion of the market. It is practically a monopoly. This is not good for business.”

How Independent Artists and Labels Are Getting Squeezed Out by the “Vinyl Revival” | Noisey – Vice
“But the law of supply and demand is not necessarily applicable in this case, as within the same time frame, the number of facilities producing vinyl has remained static, at roughly 20 active pressing plants nationwide. These facilities can in no way meet the current demand for vinyl. “
…
“I currently have a release at United [pressing plant] and it’s been over two months, and I still don’t even have a test pressing yet. I put in a re-order [a re-pressing of a previously pressed album, usually necessitating less turnaround time than a new release due to fewer steps in the production process to create the vinyl] for back catalog releases and I was told it would be at least 16 weeks. Sixteen weeks! Four months for a re-order!”

No, vinyl sales have not overtaken music streaming revenues | Telegraph UK
“A mid-year report from the Recording Industry Association of America (RIAA) found that US consumers spent $226m (£149m) on vinyl albums and singles in the first half of the year, surpassing $162.7m in revenues from ad-supported streaming.
…
What that means is that the amount Americans were willing to spend on vinyl records was higher than the amount the music industry made from the streaming services those consumers weren’t willing to pay for, such as Spotify’s free service and YouTube. “

Indie Labels Say Major Labels “Constipate” Pressing Plants for Record Store Day | Digital Music News
“There are currently no copies of Spectres’ album ‘Dying’ on vinyl in the shops because the repress is somewhere towards the back of the queue after some Foo Fighters studio scrapings, a host of EPs by The 1975 and about a million heavyweight ‘heritage rock’ reissues that no-one really needs.”

Hey Record Store Day, Face the Facts. You’re Hurting Indie Labels. | Digital Music News
“If the majors want to start pressing lots of records again they’re more than welcome to, but perhaps it would be better received if they invested some of their capital into building new pressing plants to lessen the strain.”

“It’s unfortunate, but it seems like every year our vinyl schedule gets delayed by months for some *limited* Dave Grohl or Jack White single.“

Have We Reached Peak Vinyl? | Stereogum
“Stewart Anderson has had enough. The frontman for noise-pop veterans Boyracer and head of likeminded label 555 Recordings has been releasing music on vinyl since 1991. But the well-documented manufacturing delays that have gone hand in hand with the format’s unlikely resurgence have finally pushed the artist/entrepreneur to the point of wanting to break it off with analog discs.

by Trichordist Editor

The problem is the music-streaming companies | The Hill – Paul Williams

Songwriters have a number of allies in the ongoing fight to update our nation’s horribly outdated music licensing laws. But after reading the recent post by CALInnovate’s Mike Montgomery (“Songwriters are fighting the wrong fight,” 10/5/15), it’s clear that he is not one of them. On what grounds can Montgomery, who represents technology industry interests, claim that he speaks on behalf of songwriters?

As a songwriter elected to represent the interests of ASCAP’s more than 550,000 music creator members, I find Montgomery’s arguments absurd and grossly misleading.

READ THE FULL STORY AT THE HILL:
http://thehill.com/blogs/congress-blog/technology/256247-the-problem-is-the-music-streaming-companies

by trichordist

“Complaining is not a Strategy:” The MMF Tour Blames the Victims on Streaming

Screen Shot 2015-10-08 at 6.13.42 PM

“Complaining is not a strategy?” The MMF has found its inner robber baron.  By this logic those who protested against child labour or unfair pay in the last great industrial upheaval were “complaining” and lacked “a strategy.”  The cynical implication is that the blame lies with the victim.  The weak and the poor have failed to innovate or legislate their way out of this.  Instead they just “complain.”     Sad, the once great MMF/FAC is now simply a mouthpiece for the robber barons of  the 21st century.  Much the way the Hearst family owned news papers apparently the streaming industry funds these forums now (see: https://thetrichordist.com/2015/06/30/breaking-source-claims-spotify-google-fund-independent-music-managers-forum-and-featured-artist-coalition/)

Here are some of the “balanced” and “informative” comments from panelists at the NY forum:

“Spotify is the best product ever.”
“It’s so frustrating that artists don’t understand [how great Spotify is].”
“It’d be a shame if sensationalized media stories about low royalty payments stopped people from subscribing to streaming services like Spotify, which is so awesome.”

In NY at least Tommy Silverman was honest about what is really going on. Our sources reports Silverman said “The question is will artists be willing to take a short term loss for long term gain.”  That’s right.  Artists are currently subsidizing these services with below market rates on their songs and recordings.  The problem is there is no reward for our risk taken.  There is nothing for us “in the long term.”  As we have demonstrated streaming rates are actually trending lower. And unlike many managers we didn’t end up with equity in Spotify.  This is one of the reasons we can’t wait for the Spotify IPO.  We believe that the disclosure of ownership shares may cause some legal trouble for certain individuals.

Here is Blake Morgan’s report on the goings on at the NY meetings.   BTW you still have time to show up at the Austin meeting(hint hint).

 

by Dr. David C Lowery

Transparency Starts Upstream for Streaming Royalties | HuffPo – Chris Castle

We’ve often noted that if the economics at the top of the waterfall are near zero dollars (in microcents) then what trickles down will not get any better…

We’ve seen stories recently about various successes for artists in negotiations with major labels about “transparency” in the payment of the artist’s share of streaming royalties received by record companies. This is great news of course, but the new buzz word “transparency” should be understood in context. There is nothing the digital services would like more than to deflect the ire of artists and songwriters who are enraged about minuscule royalties away from the services and onto record companies or music publishers.

Creators need to be alert that they are not being duped into a false deflection because even in the best case, record companies can only pay on the royalties they receive from services.

READ THE FULL STORY AT THE HUFFINGTON POST:
http://www.huffingtonpost.com/chris-castle/transparency-starts-upstr_b_8238934.html

by trichordist

Jimmy Iovine says, “YouTube is 40% of music business volume and 4% of music business revenue. That’s a problem!” ‪#‎vfsummit‬

‘Freemium’ music streaming

“This whole thing about freemium, it’s a shell game. These companies are building an audience on the back of the artist, and it really bugs me.”

On YouTube and music

“Here’s a little statistic … they are 40% of consumption of music and 4% of the revenue. That’s a problem! … They know that doesn’t work. But do they care? I have no idea.”

READ THE FULL STORY AT THE LA TIMES:
http://www.latimes.com/business/technology/la-fi-tn-jimmy-iovine-20151007-story.html

by trichordist

What is the Intention of Justice? Notice and Stay Down is the Government’s Responsibility

Will Buckley at FarePlay has created a petition to support “Take Down, Stay Down” at http://www.takedownstaydown.org/ Read more about this important issue below and at Music Tech Policy.

Music Technology Policy

ARTHUR

Let’s get back to justice…what is justice?  What is the intention of justice? The intention of justice is to see that the guilty people are proven guilty and that the innocent are freed.  Simple isn’t it?  Only it’s not that simple.

From …And Justice for All, written by Valerie Curtin and Barry Levinson.

There is a new term in our lexicon:  Notice and stay down.  What does it mean?

It is a way of encapsulating a distortion of the law that large multinational corporations are using to their immense profit by middlemaning the theft of other people’s property in the weaponized Internet.

In the late 1990s, the large ISPs had a legitimate concern.  If they are providing ways for the many to connect with each other over the Internet by means of a technology that also enabled them anonymously to send digitized property by means of that technology–such as…

View original post 1,043 more words

by Trichordist Editor

MegaUpload (MegaVideo) Smoking Gun? Did the site illegally charge for Streaming Movies?

With Kim Dotcom getting his day in court, this is timely.

The Trichordist

These screen shots appear to show that Kim Dotcom’s Megaupload was selling streaming movies that it did not have the rights to sell.

Megaupload was allegedly paid uploaders per stream from files they uploaded to Megaupload. That is why there were so many links that Google autopopulated Megavideo after you entered Star Wars in the search field.

Then Google estimated that there were 4.3 million web pages that had the words “star wars megavideo” on them.  Legitimate file locker sites like Dropbox, don’t allow any public links to copyrighted content.  In fact Dropbox just banned Boxopus, a torrent tool from using its API.

Megavideo let you play the first 45 minutes of Star Wars and thousands of other movies for free (after they had served you and profited from dozens ads) . . .

But then, to watch past 45 minutes, you had to enter your credit card and pay…

View original post 83 more words

by Trichordist Editor

Bloomberg Reports “The Fake Traffic Schemes That Are Rotting The Internet”

Uh oh… Is internet advertising just a house of cards?

Late that year he and a half-dozen or so colleagues gathered in a New York conference room for a presentation on the performance of the online ads. They were stunned. Digital’s return on investment was around 2 to 1, a $2 increase in revenue for every $1 of ad spending, compared with at least 6 to 1 for TV. The most startling finding: Only 20 percent of the campaign’s “ad impressions”—ads that appear on a computer or smartphone screen—were even seen by actual people.

“The room basically stopped,” Amram recalls. The team was concerned about their jobs; someone asked, “Can they do that? Is it legal?” But mostly it was disbelief and outrage. “It was like we’d been throwing our money to the mob,” Amram says. “As an advertiser we were paying for eyeballs and thought that we were buying views. But in the digital world, you’re just paying for the ad to be served, and there’s no guarantee who will see it, or whether a human will see it at all.”

READ THE FULL STORY AT BLOOMBERG:
http://www.bloomberg.com/features/2015-click-fraud/

by trichordist