Tag: Chris Castle

MTP Interview: We ask @Creators_ECSA President @Helienne Lindvall to Explain the European Parliament’s Streaming Economy Report from the Committee on Culture and Education

This post first appeared on MusicTechPolicy by Chris Castle.

The Culture and Education of the European Parliament issued an important report on the state of the creative economy. Our friend Helienne Lindvall, President of the European Composer and Songwriter Alliance, gives us some insights into the report and the context.

I know ECSA was involved in testifying for the EU cultural diversity report, can you tell us a little about the report, what prompted it and how does it help or hurt?

Streaming and the amount of issues it brought with it has been at the top of the agenda for European songwriters since the launch of Spotify. As an Ivors Academy Board Director, I was part of the inception of the UK #FixStreaming campaign which resulted in the UK Government calling for a complete overhaul of music streaming, and for the creation of music industry working groups to fix these problems. Meanwhile, similar lobbying efforts have been applied in Brussels by music creators across Europe. The EU has a fine history of promoting, supporting and protecting culture – in 2019, legislators proved it by adopting the DSM Copyright Directive. Now we need it to step up to help create a sustainable streaming environment. 

Rapporteur Iban Garcia del Blanco and his fellow CULT MEPs took their time to really listen to and understand the reality that music authors (ie songwriters and composers) face, and our proposed remedies, and I think the report reflects that.

Is the report designed to shape future legislation or rulemaking in the EU?

We look forward to seeing the European Commission work on such a strategy and take concrete actions to build a fair and sustainable music streaming ecosystem for all music creators.. 

MEP Garcia del Blanco said at the press conference that he would prefer if the industry stakeholders could sit down and fix these problems without further legislation, but judging from our experience in the UK, certain areas are easier to get a consensus on than others. The UK metadata working group has set parameters for improvements, which I believe can easily be adopted across Europe and beyond. However, when it comes to remuneration and making it fairer for songwriters and performers, we have met with resistance from labels and platforms – unsurprisingly, perhaps. Getting increased transparency has also proved more difficult. If this resistance remains we will keep pushing for Government intervention and legislation. 

The report calls for a comprehensive and ambitious strategy based on independent data and a structured dialogue with all stakeholders, and we stand ready to work with the entire music value chain towards a fairer distribution of revenues, and we support the establishment of a European Music Observatory to collect and analyse data.

I noticed this language in the report calling on EU parliament:  “Calls for action to be taken at the European Union level to guarantee the visibility and accessibility of European musical works, considering the overwhelming amount of content constantly growing on music streaming platforms and the lack of Union rules to regulate them in a harmonised manner”.  and algorithmic dominance? 

It may come as no surprise that American and major label records still dominate on streaming platforms.

Is this designed to keep local language artists from being overwhelmed by English language tracks due to algorithmic bias or Spotify’s stream discrimination plans?

The short answer is: yes. During our stakeholder testimonials in the EU Parliament, Spotify claimed that streaming has increased diversity. And, yes, it may be true that some European countries have seen plenty of local acts in their local charts, though by no means all countries have experienced this, but on an international level there’s still a huge dominance of Anglo-American repertoire. Then we have the issue of the dominance of legacy artists and catalogue albums, such as ABBA, Fleetwood Mac and Elton John. 

In a post-Brexit reality, does the report have any effect on the UK?

The EU doesn’t have any legislative powers when it comes to the UK, due to Brexit, but as streaming is cross-border, as is the music industry, an improvement in either would have an impact on both. Some EU members have already implemented their own versions of equitable remuneration, such as Belgium and Spain – and France is establishing a streaming tax to support local music – but we would like to see solutions and changes that help ALL music creators, in particular songwriters, who currently are at the bottom when it comes to their share of the streaming royalty “pie”, and are finding it next to impossible to survive on their music, despite getting millions of streams. 

Given the attention that the Bad Dog story is getting, would the metadata accuracy proposals in the report help to stop outright fraud and impersonation? 

Yes, it would. Overall, we need more transparency, accountability and accuracy to deal with fraud. These are all words that get thrown around the industry willy-nilly but are rarely truly abided by. In this industry, companies rarely make an effort when it comes to accuracy unless there is an incentive for them to do so. What is the incentive for distributors and platforms to clean up their act and make an effort to prevent bad actors from profiting from fraudulent streams when they still get a share of those streams? I make the comparison to physical stores: If a supermarket sold counterfeit products, they’d be in trouble with the law. Why not these platforms and distributors? And this is before we even get into what’s happening on TikTok, which is the wild west when it comes to unlicensed usage. 

Does the metadata accuracy help to enforce “know your customer” type minimum indentifiable data requirements?

Accurate metadata is vital for so many reasons. Not only because more than 20% of all song revenue is unallocable and won’t go to the rightful recipient, but it will help in the fight against fraud. The way I put it to legislators is: You wouldn’t be able to buy a tuna sandwich in the supermarket without being able to read EXACTLY what is in it on the package, or the trader knowing who to pay for those ingredients. So how can it be legal for streaming services to accept, display and charge for recordings without knowing who created the underlying composition? How can they collect money without having any information on who to pay it to? And, as we’ve discovered with cases such as the Bad Dog story and Swedish criminal gangs using Spotify streams to launder money, that money could even be funding drug and weapons trafficking. 

Anything else you think is important about the report? 

The report calls for action when it comes competition issues and the dominance of a handful of labels and platforms, issues that we believe suppresses our bargaining power. It also stresses that authors, performers and other rights holders should be allowed to reserve and license the rights for the use of their work for AI training, and it acknowledges that this requires transparency. Overall it’s an important report that aims to correct the imbalances that have led to the unsustainable situation music creators find themselves in, and to build a sustainable, thriving and diverse cultural future. It couldn’t come soon enough. 

by Trichordist

I Grift Therefore I Am: Jared Polis Supports Silicon Valley’s “Speculative Tickets” Grift in Colorado

If you had a chance to watch the CLE panel that David Lowery, Mala Sharma and Chris Castle did for the University of Texas School of Law CLE last week, you’ll remember that the panel spent a good deal of time talking about “speculative tickets”. In fact, the title of the panel was “When is Ticketing Like Pork Bellies?” which was a direct reference to the similarities between speculative tickets and commodities futures contracts (like pork bellies).

The way this grift works is that somebody (or some thing in the case of bots) offers to sell a promise to sell a ticket in the future. The trick is that the ticket is not yet on sale anywhere but certain dates have been announced so it will be on sale. This could be any ticket, like a concert tour or a sporting event like the Super Bowl, the Rose Bowl, the World Series, and so on.

This is actually worse than a pork belly contract, because you know that the pork bellies exist when you buy the contract, you just don’t know the price. Market events could cause the price to fluctuate, but there will be some pork belly available somewhere. So to even call it a ticket is a misnomer. It’s a promise to sell something that may exist to get all Cartesian about it.

The grifter prices the speculative ticket promise at a premium, naturally. Some of them actually promise an actual seat, some promise a certain section or block of seats. They then list that ticket on a ticket reseller market place like Stubhub which was most definitely lobbying in force for the nonsensical Georgia ticketing bill that failed and which we assume is behind all these bills that keep popping up like syphilitic warts.

After the ticket is listed, a fan buys the speculative ticket promise and waits to get their actual tickets. And this is the really insidious part. As David noted on our panel, the grifter’s transaction is like covering on a naked short in short selling. Naked shorts are a very risky thing because unlike with speculative tickets, the market enforces the trade. You will pay on that bet unlike speculative tickets where there is no market enforcement except the occasional prosecution by a state attorney general or the FTC.

It seems impossible for the speculative ticket short seller to obtain the actual tickets without using bots. Plausible, perhaps, but seems very unlikely. Thanks to Senator Marsha Blackburn and Richard Blumenthal and their BOTS Act, federal law prohibits using bots, but again, it’s a science of getting caught. Senator Blackburn recently complained quite rightly that the FTC is not sufficiently enforcing the BOTS Act.

If the grifter cannot come up with the tickets, it is apparently very rare that the fan gets their money back. The fan will be offered all manner of things other than cash or maybe the grifter just slithers off into the night. Awful stuff, right?

The grifter is preying on the buyer’s love of the artist or the team (or the family member of the buyer) which is so great that they are willing to spend the money because they are made to believe they have a sure bet that will pay off with a real ticket. What kind of a heartless dickweed would do that to someone?

And here’s where Jared Polis comes in. If you’ve never heard of him, Jared Polis is the governor of Colorado. The Colorado legislature recently passed SB60 that would have joined other states in banning speculative tickets. But–on June 6, 2023 Jared Polis vetoed the bill.

So how did StubHub get to Jared Polis? Remember, Jared Polis is a 99er who made a fortune on the Internet before the Internet repriced itself. He also founded TechStars, so he’s a VC, too. So he knows all about grifters and could not give a rip about artists–as he has demonstrated many times. But his veto letter is worth reading because of its complete head up the ass approach to speculative tickets.

Polis goes through the “if you only had a brain” analysis saying there are some good things in SB60 which he could support but then there are the bad things which he, Polis the Lawmaker, simply cannot abide–like a prohibition on speculative tickets. Except he doesn’t call them speculative tickets like the Federal Trade Commission does, or the Attorney General of New York. Oh, no. In his veto letter, he calls them “innovative products that address existing market failures, such as online ticket waiting services“.

Wait a minute–are we talking about the same thing here?

The bill prohibits anyone that “Advertises, offers for sale, or contracts for the resale of a ticket unless the person has possession or constructive possession of the ticket and the person has an agreement with the rights holder.”

Somehow the bill language got transformed from protecting consumers against speculative ticketing to a whole new thing, an innovative product that a VC might invest in and even take that company public. Or could have in 1999.

Sure seems like Polis is in on the grift, don’t it? You can’t call it a conspiracy theory because there’s nothing theoretical about it.



by thetrichordist

Should the Compulsory License be Re-Upped?

By Chris Castle

[This post first appeared on MusicTechPolicy]

The wisest of those among you learn to read your portents well
There’s no need to hurry, it’s all downhill to Hell…

Don’t Stand Still, written by The Original Snakeboy, performed by Guy Forsyth

Congress is considering whether to renew The MLC, Inc.‘s designation as the mechanical licensing collective. If that sentence seems contradictory, remember those are two different things: the mechanical licensing collective is the statutory body that administers the compulsory license under Section 115. The MLC, Inc. is the private company that was “designated” by Congress through its Copyright Office to do the work of the mechanical licensing collective. This is like the form of a body that performs a function (the mechanical licensing collective) and having to animate that form with actual humans (The MLC, Inc.), kind of like Plato’s allegory of the cave, shadows on the wall being what they are.

Congress reviews the work product of The MLC, Inc. every five years (17 USC §115(d)(3)(B)(ii)) to decide if The MLC, Inc. should be allowed to continue another five years. In its recent guidance to The MLC, Inc. about artificial intelligence, the Copyright Office correctly took pains to make that distinction in a footnote (footnote 2 to be precise. Remember–always read the footnotes, it’s often where the action is.). This is why it is important that we be clear that The MLC, Inc. does not “own” the data it collects (and that HFA as its vendor doesn’t own it either, a point I raised to Spotify’s lobbyist several years ago). Although it may be a blessing if Congress fired The MLC, Inc. and the new collective had to start from scratch.

But Congress likely would only re-up The MLC, Inc. if it had already decided to extend the statutory license and all its cumbersome and byzantine procedures, proceedings and prohibitions on the freedom of songwriters to collectively bargain. Not to mention an extraordinarily huge thumbs down on the scales in favor of the music user and against the interest of the songwriters. The compulsory license is so labyrinthine and Kafka-esque it is actually an insult to Byzantium, but that’s another story.

Rather than just deciding about who is going to get the job of administering the revenues for every songwriter in the world, maybe there should be a vote. Particularly because songwriters cannot be members of the mechanical licensing collective as currently operated. Congress did not ask songwriters what they thought when the whole mechanical licensing scheme was established, so how about now?

Before the Congress decides to continue The MLC, Inc. many believe strongly that the body should reconsider the compulsory license itself. It is the compulsory license that is the real issue that plagues songwriters and blocks a free market. The compulsory license really has passed its sell by date and it’s pretty easy to understand why its gone so sour. Eliminating the Section 115 license will have many implications and we should tread carefully, but purposefully.

Party Like it’s 1909

First of all, consider the actual history of the compulsory license. It’s over 100 years old, and it was established at a time, believe it or not, when the goal of Congress was to even the playing field between, music users and copyright owners. They were worried about music users being hard done by because of the anticompetitive efforts of songwriters and copyright owners. As the late Register Marybeth Peters told Congress, when Congress created the exclusive right to control reproduction and distribution in 1909, “…due to concerns about potential monopolistic behavior [by the copyright owners], Congress also created a compulsory license to allow anyone to make and distribute a mechanical reproduction of a nondramatic musical work without the consent of the copyright owner provided that the person adhered to the provisions of the license, most notably paying a statutorily established royalty to the copyright owner.”

Well, that ship has sailed, don’t you think? 

This is kind of incredible when you think about it today because the biggest users of the compulsory license are those who torture the bejesus out of songwriters by conducting lawfare at the Copyright Royalty Board–the richest corporations in commercial history that dominate practically every moment of American life. In fact, the statutory license was hardly used at all before these fictional persons arrived on the scene and have been on a decades-long crusade to hack the Copyright Act through lawfare ever since. This is particularly true since about 2007 when Big Tech discovered Section 115. (And they’re about to do it again with AI–first they send the missionaries.)

If the purpose of the statutory scheme was to create a win-win situation that floats all boats, you would have expected to see songwriters profiting like never before, right? If the compulsory was so great, what we really needed was for everyone to use Section 115, right? Actually, the opposite has happened, even with decades of price fixing at 2¢ by the federal government. When hardly anyone used the compulsory license, songwriters prospered. When its use became widespread, songwriters suffered, and suffered badly.

Songwriters have been relegated to the bottom of the pile in compensation, a sure sign of no leverage because whatever leverage songwriters may have is taken–there’s that word again–by the compulsory license. I don’t think Google, a revanchist Microsoft, Apple, Amazon or Spotify need any protection from the anticompetitive efforts of songwriters. Google, Amazon, Apple, Microsoft, Spotify are only worried about “monopolistic behavior” when one of them does it to one of the others. The Five Families would tell you its nothing personal, it’s just business. 

Yet these corporate neo-colonialists would have you believe that the first thing that happens when the writing room door closes is that songwriters collude against them. (Sounding very much like the Radio Music Licensing Committee–so similar it makes you wonder, speaking of collusion.) 

The Five Year Plan

Merck Mercuriadis makes the good point that there is no time like the present to evolve: “In the United States, we have a position of stability for the next five years – at the highest rates paid to songwriters to date – in the evolution of the streaming economy. We are now working towards improving the songwriters’ share of the streaming revenue ‘pie’ yet further and, eventually, getting to a free market.” The clock is ticking on the next five years, a reference to the rate period set by the Copyright Royalty Board in the Phonorecords IV proceeding. (And that five years is a different clock than the five years clock on the MLC which is itself an example of the unnecessary confusion in the compulsory license.)

What would happen if the compulsory license vanished? Very likely the industry would continue its easily documented history of voluntary catalog licenses. The evidence is readily apparent for how the industry and music users handled services that did not qualify for a compulsory license like YouTube or TikTok. However stupid the deals were doesn’t change the fact that they happened in the absence of a compulsory license. That Invisible Hand thing, dunno could be good. Seems to work out fine for other people.

Let’s also understand that there is a cottage industry complete with very nice offices, pensions and rich salaries that has grown up around the compulsory license (or consent decrees for that matter). A cottage industry where collecting the songwriters’ money results in dozens of jobs paying more in a year than probably 95% of songwriters will make, maybe ever. (The Trichordist published an excerpt from a recent MLC tax return showing the highest compensated MLC employees.) Generations of lawyers and lobbyists have put generations of children through college and law school from legal fees charged in the pursuit of something that has never existed in the contemporary music business–a willing buyer and a willing seller. Those people will not want to abandon the very government policy that puts food on their tables, but both sides are very, very good at manufacturing excuses why the compulsory license really must be continued to further humanity.

The even sadder reality is that as much as we would like to simply terminate the compulsory license, there is a certain legitimacy to being clear-eyed about a transition. (An example is the proposals for transitioning from PRO consent decrees–ASCAP’s consent decree has been around a long time, too.) There would likely need to be a certain grandfathering in of services that were pre or post the elimination of the compulsory, but that’s easily done, albeit not without a last hurrah of legal fees and lobbyist invoices. Register Pallante noted in the well-received 2015 Copyright Office study (Copyright and the Music Marketplace at 5) “The Office thus believes that, rather than eliminating section 115 altogether, section 115 should instead become the basis of a more flexible collective licensing system that will presumptively cover all mechanical uses except to the extent individual music publishers choose to opt out.”  An opt out is another acceptable stop along the way to liberation, or even perhaps a destination itself. David Lowery had a very well thought-out idea along these lines in the pre-MLC era that should be revisited.

X Day

However, while there is a certain attractiveness to having a plan that the dreaded “stakeholders” and their legions of lobbyists and lawyers agree with, it is crucially important for Congress to fix a date certain by which the compulsory license will expire. Rain or shine, plan or no plan, it goes away on the X Day, say five years from now as Merck suggests. So wakey, wakey. 

That transparency drives a wedge into the process because otherwise millions will be spent in fees for profiting from moral hazard and surely the praetorians protecting the cottage industry wouldn’t want that. If you doubt that asking for a plan before establishing X Day would fail as a plan, just look at the Copyright Royalty Board and in particular the Phonorecords III remand. Years and years, multiple court rulings, and the rates still are not in effect.  Perseveration is not perseverance, it’s compulsive repetition when you know the same unacceptable result will occur.

But don’t let people tell you that the sky will fall if Congress liberates songwriters from the government mandate. The sky will not fall and songwriters will have a generational opportunity to organize a collective bargaining unit with the right to say no to a deal. 

Who can forget Sally Fields in Norma Rae?

The closest that Congress has come to a meaningful “vote” in the songwriting world is inviting public comments through interventions, rule makings, roundtables and the like–information gathering that is not controlled by the lobbyists. Indeed, it was this very process at the Copyright Royalty Board that resulted in many articulate comments by songwriters and publishers themselves that were clearly quite at odds with what the CRB was being fed by the lobbyists and lawyers. So much so that the Copyright Royalty Judges rejected not only the “Subpart B” settlement reached by the insiders but the very premise of that settlement. Imagine what might happen if the issue of the compulsory license itself was placed upon the table?

Now that songwriters have had a taste of how The MLC, Inc. has been handling their money, maybe this would be a good time to ask them what they think about how things are going. And whether they want to be liberated from the entire sinking ship that is designed to help Big Tech. And you can start by asking how they feel about the $500 million in black box money that is still sitting in the bank account of The MLC, Inc. and has not been paid–with an infuriating lack of transparency. Yet is being “invested” by The MLC, Inc. with less transparency than many banks with smaller net assets.

This “investment” is another result of the compulsory license which has no transparency requirements for such “investments” of other peoples’ money, perhaps “invested” in the very Big Tech companies that fund the The MLC, Inc. That wasn’t a question that was on the minds of Congress in 1909 but it should be today.

Attention Must Be Paid

Let’s face facts. The compulsory license has coexisted in the decimation of songwriting as a profession. That destruction has increased at an increasing rate roughly coincident with the time the Big Tech discovered Section 115 and sent their legions of lawyers to the Copyright Royalty Board to grind down publishers, and very successfully. That success is in large part due to the very mismatch that the compulsory license was designed to prevent back in 1909 except stood on its head waiting for loophole seekers to notice the potential arbitrage opportunity. 

The Phonorecords III and IV proceedings at the Copyright Royalty Board tell Congress all they need to know about how the game is played today and how it has changed since 1909, or the 1976 revision of the Copyright Act for that matter. The compulsory license is no longer fit for purpose and songwriters should have a say in whether it is to be continued or abandoned.

We see the Writers Guild striking and SAG-AFTRA taking a strike authorization vote. When was the last time any songwriters voted on their compensation? Maybe never? Voting, hmm. There’s a concept. Now where have I heard that before?

by thetrichordist

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

By Chris Castle

[This post first appeared on MusicTechPolicy]

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

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

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

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

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

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

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

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

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

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

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

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

by Trichordist Editor

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

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

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

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

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

by theinvisiblestagehand

Artist Rights Symposium III at @TerryCollege at UGA, Keynote by @MMercuriadis of @HipgnosisSongs

We’re back! David Lowery hosted the third annual Artist Rights Symposium at the University of Georgia’s Terry College in Athens on November 15 as an in-person event. The Symposium is an all-day event that allows students in the Music Business program to participate and interact with panelists as part of the music business program.

Our keynote speaker was the inspiring Merck Mercuriadis, long time songwriter advocate, manager and music industry veteran who founded and runs the Hipgnosis Songs Fund. Merck is an active songwriter advocate around the world, particularly with the recent inquiry into the music streaming economy by the UK Parliament’s Digital Culture Media & Sport Committee and the UK Competition and Markets Authority. As Kristin Robinson reported on Billboard

Merck explained why he feels the industry is in the “age of the songwriter.” “There has been a massive paradigm shift,” he said. “Forty years ago, the power was in the artist brand,” but now, most songs that top the Billboard charts are written by a larger number of songwriters than ever, meaning the demand has never been higher for good hitmakers. “But songwriters have to have a place at the negotiating table now,” he said, citing that in the United States, rates for mechanicals are set by the government’s Copyright Royalty Board, barring “free market” negotiations. “Let’s face it, [the government controlling rates] is insulting to songwriters.”

This year’s symposium topic was “The Future of Authorship and the US Copyright Office” and Merck and the stellar panelists had a lot to say about the many advocacy issues facing contemporary songwriters.

Fortunately, thanks to Terry College the symposium is available on YouTube at no charge and you can watch it in its entirety.

Welcome/Opening remarks

9:00 AM -9:10 AM David Barbe, Director, Terry College Music Business Program

Georgia Legislative Overview and Agenda 9:10 AM- 9:30 AM

Panel 1: Libraries vs Authors: The Internet Archive’s “Controlled Digital Lending” and Fair Renumeration for Authors. 9:35 AM- 10:50 AM

Panelists

Janice Pilch.  Rutgers University
John Degen:  Writer, Head of Writers Union Canada.
Stephen Carlisle: Copyright Officer Nova Southeastern University,Florida
Mary Rasenberger, CEO, Authors Guild and Authors Guild Foundation.

Panel 2 Managing a longer Table at the Copyright Royalty Board 11:10 AM to 12:25 PM

Dr. David C. Lowery Moderator
Rick Carnes, Songwriters Guild of America
David Turner, Penny Fractions, SoundCloud
Crispin Hunt, Songwriter, Ivors Academy, #BrokenRecord

Lunch and Fireside Chat with Merck Mercuriadis 12:45– 2:00 PM

Panel 3 #DoubleStat: The Future of Compulsory Rates 2:20 PM – 03:35 PM

Chris Castle Moderator, Founder Christian L. Castle, Attorneys, Austin and MusicTechPolicy blog
Richard Burgess, CEO of the American Association of Independent Music (A2IM)
Helienne Lindvall, President, European Composers and Songwriters Association
Samantha Schilling, Songtradr, IAFAR

Metadata, Matching and Claiming at the MLC 3:55 – 5:10 PM

Moderator Abby North, North Music Group
Erin McAnally, Artist Rights Alliance
Helienne Lindvall President, European Composers and Songwriters Association
Melanie Santa Rosa, Word Collections, The MLC

Please leave a comment if you have any questions!

by Trichordist Editor

Will the Copyright Royalty Board approve Big Tech’s attempted cover-up? 

By Chris Castle

[This MusicTechPolicy post appeared on Hypebot]

There’s an old saying among sailors that water always wins. Sunlight does, too. It may take a while, but time reveals all things in the cold light of dawn. So when you are free riding on huge blocks of aged government cheese like the digital music services do with the compulsory mechanical license, the question you should ask yourself is why hide from the sunlight? It just makes songwriters even more suspicious. 

This melodrama just played out at the Copyright Royalty Board with the frozen mechanicals proceeding. Right on cue, the digital services and their legions of lawyers proved they hadn’t learned a damn thing from that exercise. They turned right around and tried to jam a secret deal through the Copyright Royalty Board on the streaming mechanicals piece of Phonorecords IV. 

To their great credit, the labels handled frozen physical mechanicals quite differently. They voluntarily disclosed the side deal they made with virtually no redactions and certainly didn’t try to file it “under seal” like the services did. Filing “under seal” hides the major moving parts of a voluntary settlement from the world’s songwriters. Songwriters, of course, are the ones most affected by the settlement–which the services want the CRB to approve–some might say “rubber stamp”–and make law.

To fully appreciate the absolute lunacy of the services attempt at filing the purported settlement document under seal, you have to remember that the Copyright Royalty Judges spilled considerable ink in the frozen mechanicals piece of Phonorecords IV telling those participants how important transparency was when they rejected the initial Subpart B settlement.  

This happened mere weeks ago in the SAME PHONORECORDS IV PROCEEDING.

Were the services expecting the Judges to say “Just kidding”? What in the world were they thinking? Realize that filing the settlement–which IF ACCEPTED is then published by the Judges for public comment under the applicable rules established long ago by Congress–is quite different than filing confidential commercial information. You might expect redactions or filings under seal, “attorneys eyes only,” etc., in direct written statements, expert testimony or the other reams of paper all designed to help the Judges guess what rate a willing buyer would pay a willing seller. That rate to be applied to the world under a compulsory license which precludes willing buyers and willing sellers, thank you Franz Kafka. 

When you file the settlement, that document is the end product of all those tens of millions of dollars in legal fees that buy houses in the Hamptons and Martha’s Vinyard as well as send children to prep school, college and graduate school. Not the songwriters’ children, mind you, oh no. 

The final settlement is, in fact, the one document that should NEVER be redacted or secret. How else will the public–who may not get a vote but does get their say–even know what it is the law is based on assuming the Judges approve the otherwise secret deal. It’s asking the Judges to tell the public, the Copyright Office, their colleagues in the appeals courts and ultimately the Congress, sorry, our version of the law is based on secret information.

Does that even scan? I mean, seriously, what kind of buffoons come up with this stuff?  Of course the Judges will question the bona fides and provenance of the settlement. Do you think any other federal agency could get away with actually doing this? The lawlessness of the very idea is breathtaking and demonstrates conclusively in my view that these services like Google are the most dangerous corporations in the world. The one thing that gives solace after this display of arrogance is that some of them may get broken up before they render too many mechanical royalty accounting statements.

To their credit, after receiving the very thin initial filing the Judges instructed the services to do better–to be kind. The Judges issued an order that stated:

The Judges now ORDER the Settling Parties to certify, no later than five days from the date of this order, that the Motion and the Proposed Regulations annexed to the Motion represent the full agreement of the Settling Parties, i.e., that there are no other related agrements and no other clauses. If such other agreements or clauses exist, the Settling Parties shall file them no later than five days from the date of this order.

Just a tip to any younger lawyers reading this post–you really, really, really do not want to be on the receiving end of this kind of order.

Reading between the lines (and not very far) the Judges are telling the parties to come clean. Either “certify” to the Judges “that there are no other related agreements and no other clauses” or produce them. This use of the term “certify” means all the lawyers promise to the Judges as officers of the court that their clients have come clean, or alternatively file the actual documents.

That produced the absurd filing under seal, and that then produced the blowback that led to the filing of the unsealed and unreacted documents. But–wait, there’s more.

Take a close look at what the Judges asked for and what they received. The Judges asked for certification “that there are no other related agrements and no other clauses. If such other agreements or clauses exist, the Settling Parties shall file them no later than five days from the date of this order.”

What the Judges received is described in the purportedly responsive filing by the services:

The Settling Participants [aka the insiders] have provided all of the settlement documentsand, with this public filing, every interested party can fully evaluate and comment upon the settlement. The Settling Participants thus believe that the Judges have everything necessary to “publish the settlement in the Federal Register for notice and comment from those bound by the terms, rates, or other determination set by the” Settlement Agreement, as required under 37 C.F.R. 351.2(b)(2). The Settling Participants respectfully request that the Judges inform them if there is any further information that they require.

Notice that the Judges asked for evidence of the “full agreement of the Settling Parties”, meaning all side deals or other vigorish exchanged between the parties including the DSPs that control vast riches larger than most countries and are super-conflicted with the publishers due to their joint venture investment in the MLC quango.

The response is limited to “the settlement documents” and then cites to what the services no doubt think they can argue limits their disclosure obligations to what is necessary to “publish the settlement”. And then the services have the brass to add “The Settling Participants respectfully request that the Judges inform them if there is any further information that they require.” Just how are the Judges supposed to know if the services complied with the order? Is this candor?

It must also be noted that Google and the NMPA have “lodged” certain documents relating to YouTube’s direct agreements which they claim are not related to the settlement to be published for public comment. These documents are, of course, secret:

[And] are not part of the settlement agreement or understanding of the settling participants concerning the subject matter of the settlement agreement, and do not supersede any part of the settlement agreement with respect to the settling participants’ proposed Phonorecords IV rates and terms. Further, the letter agreements do not change or modify application of the terms to be codified at 37 C.F.R. 385 Subparts C and D, including as they apply to any participant. Rather, the letter agreements simply concern Google’s current allocation practices to avoid the double payment of royalties arising from YouTube’s having entered into direct agreements with certain music publishers while simultaneously operating under the Section 115 statutory license.

You’ll note that there are a number of declarative statements that lets the hoi polloi know that the Data Lords and Kings of the Internet Realms have determined some information involving their royalties is none of their concern. How do you know that you shouldn’t worry your pretty little head about some things? Because the Data Lords tell you so. And now, back to sleep you Epsilons.

So you see that despite the statements in the group filing to the CRB that the “Settling Participants” (i.e., the insiders) claim to have provided all of the settlement documents required by the Judges, Google turns right around and “lodges” this separate filing of still other documents that they think might be related documents with some bearing on the settlement that should be disclosed to the public but they apparently will not be disclosing without a fight. How do we know this? Because they pretty much say so:

Because the letter agreements are subject to confidentiality restrictions and have each only been disclosed to their individual signatories, each such music publisher having an extant direct license agreement with Google, Google and NMPA are lodging the letter agreements directly with the Copyright Royalty Judges, who may then make a determination as to whether the letter agreements are relevant and what, if anything, should be disclosed notwithstanding the confidentiality restrictions in each of the letter agreements.

Ah yes, the old “nondisclosure” clause. You couldn’t ask for a better example of how NDAs are used to hide information from songwriters about their own money.

The Judges noted when rejecting the similar initial frozen mechanical regulations that:

Parties have an undeniable right of contract. The Judges, however, are not required to adopt the terms of any contract, particularly when the contract at issue relates in part, albeit by reference, to additional unknown terms that indicate additional unrevealed consideration passing between the parties, which consideration might have an impact on effective royalty rates. 

So there’s that.

What this all boils down to is that the richest and most dangerous corporations in commercial history are accustomed to algorithmically duping consumers, vendors and even governments in the dark and getting away with it. The question is, if you believe that sunlight always wins, do they still want to hide as long as they can and then look stupid, or do they want to come clean to begin with and be honest brokers.

As Willie Stark famously said in All the King’s Men, “Time reveals all things, I trust it so.”

by Trichordist Editor

The @CMAgovUK UK Competition and Markets Authority’s Missed Opportunity: Reaction from @MrTomGray #BrokenRecord

The literature suggests that in the presence of…positive feedbacks [from the Get Big Fast strategy], firms should pursue an aggressive strategy in which they seek to grow as rapidly as possible and preempt their rivals. Typical tactics include pricing below the short-run profit-maximizing level (or even below the cost of goods sold), rapidly expanding capacity, advertising heavily, and forming alliances to build market clout with suppliers and workers and to deter entry of new players. Intuitively, such aggressive strategies are superior because they increase both industry demand and the aggressive firm’s share of that demand, stimulating the positive feedbacks described above.

Limits to Grown in the NEw Economy: Exploring the Get big Fast strategy in ecommerce https://scripts.mit.edu/~jsterman/docs/Oliva-2003-LimitsToGrowthInTheNewEconomy.pdf

By Chris Castle

You may have seen that the UK Competition and Markets Authority released a report on music streaming in the UK. Of course, because the same players dominate the UK market like they do in France…sorry, I meant Germany…sorry I meant Canada…sorry I meant Sweden…sorry I meant the United States…how different could the competition issues be for US artists and songwriters? You have the biggest corporations in commercial history (Apple, Amazon, Facebook and Google) and the “get big fast” wannabes like Spotify (and Pandora in the US) on one side, the three major labels and the music publishing affiliates on the other side and the artists, songwriters, indie labels, indie publishers and especially the session musicians and vocalists squeezed in the middle.

Plus you have all of the biggest of Big Tech companies as well as wannabe Get-Big-Fast acolytes like Spotify and Pandora setting almost identical price points and freezing them there for a decade while refusing to exercise pricing power and nobody finds that just a trifle odd? Then in the grandest of grand deflections passing this off as the “pie” that everyone should look at instead of acknowledging that it’s the poptart served at the kid’s table in the nursery instead of the feast at the adult’s table in the dining room where the gravy bowls of shares of public stock are handed out dot-bomb style with a side of advertising barter. All while singing an apologia for payola and consumer welfare based on cheapness? You know there’s another way to get really, really cheap goods for consumers that ain’t quite so well received in history.

And yet somehow the Competition and Markets Authority passes this off as good for the consumer? With no meaningful discussion of the Malthusian and anticompetitive effects of the pro-rata model and pretty much summarily ignoring the actual revenue earned by “successful” artists in the beggar-thy-neighbor pricing and revenue charade. Not to mention the complete failure to discuss the supervoting stock at Spotify, Google and Facebook and all the other accoutrements of power that give Daniel Ek, Martin Lorentzen, Tim Cook, Sergey Brin, Larry Page, Mark Zuckerberg and Jeff Bezos control over the global music industry–pale males one and all and also looking pretty stale around the edges the singularity notwithstanding. And then there’s Bytedance and Tencent.

The logic of the CMA in avoiding these issues rivals the Warren Commission’s Single Bullet Theory. But makes total sense as the triumph of the lobbyists for the biggest corporations in commercial history. And sometimes you just might find you get what you need.

We will continue to dig into this latest report and its methodology as will others like Tom Gray, the dynamic founder of the hugely effective #BrokenRecord campaign that led to this investigation which is not over by a long shot. Tom had this reaction to a what’s next question and we take his guidance:

The CMA’s initial findings are:

the music market doesn’t have much competition;

the actions of the Majors and DSPs actively reduce that competition;

artists and songwriters are mostly, if not entirely, doing badly out of it;

but they accept the status quo using the narrowest paradigm of competition and its value to the consumer. It doesn’t go near the fact that the Majors used market power to create the very ‘norms’ the report resigns us to.

A difficult read: one which points to the weakness or indifference of national ‘authorities’ in the face of the gross expansion of multi-nationals unfettered by regulation. Monopolies should be broken to protect citizens and workers, not only to defend consumerism’s need of a saving.

What’s most ironic is you could take the CMA’s findings to a different authority with a more progressive outlook and get a completely different result. They simply don’t seem to have considered it their job to care about the hugely visible negative consequences of concentrated power on musicmakers.

If you would like to tell the Competition and Markets Authority what you think about their statements they want to hear from you.

by Trichordist

San Antonio Musicians: Texas Public Radio Presents the Music Artist Forum TODAY

Get more info and materials here

TPR Music Artist Forum | In Partnership with SLATT Management

Musicians of all ages are invited to a networking workshop and panelist discussion dedicated to understanding the future of music technology, copyright law, entertainment law, obtaining royalties, and navigation of music streaming services.

Address:

321 W. Commerce St, San Antonio, TX 78205

Doors open at 6:30pm. 

Panelist discussion will take place at 7:00pm.

Guest Panelists:

Ondrejia Scott | 7:00pm – 7:10pm

Chris Castle | 7:10pm – 7:20pm

Krystal Jones | 7:20pm – 7:30pm

Dr. Steven Parker | 7:30pm – 7:40pm

Linda Bloss-Baum | 7:40pm – 7:50pm

Food and drinks will be provided.

Musicians are welcome to submit an original track to be featured on our TPR Music Artist Forum playlist:

Professional headshots will be offered free of charge by Oscar Moreno.

We will be ending out the night with a special live performance by J. Darius live in the Malú and Carlos Alvarez Theater.

RSVP here to reserve your spot for this free event!

by theinvisiblestagehand

Save the date: A2IM Indie Week Panel with @musictechpolicy on the Impact on Indie Labels of Unfreezing Mechanicals

If you are coming to Indie Week, Trichordist readers might enjoy a panel Chris Castle is on to discuss the impact on indie labels of the Great Unfreeze! 

Entitled How the CRB’s Rejection of Frozen Mechanicals Will Affect Your Label?, the panel goes off at 10:30 am ET on Wednesday, June 15 at the New York Law School.

Speakers are Victor Zaraya: Concord (Moderator), Danielle Aguirre: NMPA (National Music Publishers’ Association), Glen Barros: Exceleration, and Chris.

If you want to read up on the issues that caused the Copyright Royalty Board to reject the failed settlement, here’s some background:

Copyright Royalty Board’s Rejection of NMPA, NSAI, Sony, Warner, Universal settlement

Copyright Royalty Board’s Reaction to Second Settlement Proposal by NMPA, NSAI, Sony, Warner and Universal

Survey Results from Songwriter Survey on Frozen Mechanicals

Comments:

Rosanne Cash

Helienne Lindvall, David Lowery, Blake Morgan

David Poe

Abby North, Erin McAnally, Chelsea Crowell

Kevin Casini

NMPA, NSAI, Sony, Warner, Universal Comment with Copy of MOU4

Chris will post about the panel afterward.

by Trichordist