Just a Word About Thom Yorke and Bit-Torrent…

We’ve been here before. We know how this story ends as it did previously for both NIN and Radiohead. We remember those experiments too and we remember what was said after that fact.

Let’s be clear:  Bit Torrent Bundles is taking advantage of an installed base of 170 million plus users that they obtained for one reason and one reason only–they have a product that they have perfected into the best tool for piracy in history.  And understand, this is not just some kid in a dorm room who came up with some software.  This is a commercial company that improves and perfects its product and has done so for 13 years.  There’s nothing spontaneous about this company that suddenly are shocked, shocked that there is piracy going on with their application.  Check out Andrew Keen’s interview with Bit Torrent founder Bram Cohen and Cohen’s unconvincing regurgitation of the Lessig excuses for stealing from artists.

Bit Torrent has been struggling for years to commercialize that installed base whether it’s through selling over 5 billion ads a month in the uTorrent browser or now by a supremely innovative business model–selling downloads.  Selling downloads was perfected by iTunes over 10 years ago and selling ads to profit from piracy is as old as Google Adsense.  So what’s innovative about Bit Torrent Bundles?

What’s innovative is that having stolen the audience from a vast number of creators, be they artists, film makers, authors, photographers, illustrators, free lancers and others, and from investors in creators, be they record companies, music publishers, book publishers and others, Bit Torrent now wants to sell the distribution channel it stole back to those who are solely responsible for creating it.

This is a form of blackmail, pure and simple.  This is why there are unfair business practice laws to protect the public from people like Bit Torrent.

If the artists participating in the Bit Torrent Bundles program are able to overlook Bit Torrent’s history, that is their decision.  If they can sleep at night knowing they are profiting from the massive theft of other peoples creations, then bully for them.  If they think it’s good logic to compromise themselves for the opportunity to sell to a mailing list of shoplifters, then we’re also looking forward to their solution for 2 plus 2 equals -5.  Please show the work.

And most importantly:  If these artists think that it’s a good idea to legitimize Bit Torrent without requiring the company to do something about the massive theft they support, then so be it.  We get it.

These type of “experiments” generally only work if the artist is someone who has had the benefit of more than a decade of marketing and promotion paid for by a multinational corporation spending millions and millions of dollars.  Which is why these artists are also the top tracks being stolen using the Bit Torrent application.  If there is logic to this, please let us know.  It just looks like the typical Big Tech shakedown.

Why?  How much money has Bit-Torrent invested in Radiohead’s career? Zero. But hey, they have distributed hundreds of millions of copies of the bands catalog to consumers without compensating the band a penny. Not one cent. Ev-er.  And now they have the brass to charge artists a distribution fee for Bit Torrent Bundles?  If Bit Torrent gave the artists the service for free, that would at least make some kind of sense.  But as usual, Big Tech just heaps insult on injury on insult.

When BitTorrent takes care of the 99.7% of infringing material they distribute, that will be cause for celebration.

RELATED:

BitTorrent, “Not Designed For Piracy”… Really? Seriously? 99% Infringing…

BitTorrent 99% Infringing, 100% Disinformation… now with Ads.

BitTorrent’s Dictator Problem. Belarus is Worse than Russia, Why Does Bittorrent Operate Development Center in Minsk?

While Artists are Bitching About Spotify Royalties… Google, YouTube and Grooveshark are in the Getaway Car…

While artists bitch about low payments from Spotify royalties,  YouTube,  Grooveshark and The Pirate Bay pay artists less or even nothing.  The reason Spotify pays so little is because it’s forced to compete with illegally operating, unlicensed sites who pay nothing at all. Artists need to focus on the big picture.

Spotify has become the symbol of inequity for artists in the digital age, and we’re not saying artists are wrong to focus on the Spotify royalty payments as an example of this inequity. We’ve written our own criticisms of Music Streaming Math and our doubts that Spotify could ever actually scale to be a sustainable business for both artists and labels.

Whatever the criticisms we may have of Spotify it is important to note that they are legal and licensed with secured rights.

The truth is that Spotify is only a symptom of a much larger disease.  The actual cause of the inequity is mass scale, enterprise level, corporate sanctioned piracy for profit. Ad Funded Piracy is the primary mechanism by which the work of artists and musicians has been devalued to fractions of cent and here’s how it works.

Imagine creating a business where you could profit by attracting every fan of every musician and band.

Imagine not requiring any licenses or permission from any of the musicians and bands.

Imagine selling advertising based on not only the overall popularity of the musicians and bands, but also from providing free streaming and/or downloads to the music of the musicians and bands.

Imagine not having to pay musicians and bands and keeping all of the advertising (and/or subscription/access fee) money.

GOOGLE:

One of the most accessible points of piracy starts at Google search and they can absolutely do more to assist legal and licensed businesses that pay artists. Digital Music News recently reported that “Google Receives Its 100 Millionth Piracy Notice. Nothing Changes…” As we’ve seen with Google’s swift retribution to Rap Genius, search can very effective to discourage or remove bad actors from the legitimate marketplace (When it is in Google’s business interest to do so!). Google is also tracking over 200,000 known domains engaged in active piracy. This seems like an easy problem to solve.

Not only did a series of research studies by the USC Annenberg Innovation Lab identify Google as one of the primary companies feeding advertising to pirate sites, but there is actually a longer darker history of Google assisting illegally operating business online.

Artists don’t get paid anything from pirate sites profiting from advertising revenue. This is the big one, those who pay nothing at all but distribute the most music at the highest volumes.

YOUTUBE:

YouTube is a company that was intentionally founded and designed to profit by ripping off artists, musicians and creators. These practices are well known from court documents published by sources such as Daily Finance.

It appears that much of the music on YouTube may still be generating profit for YouTube but not so much for musicians. East Bay Ray of the Dead Kennedy’s details the state of things here on NPR.

Even when YouTube is paying, they are paying half as much (or less) than Spotify on a per play basis.

GROOVESHARK:

We’d love to hear from artists (musicians and songwriters) who actually have their music legally licensed on Grooveshark. And, for those who do, we’d love to see what some of those royalty statements look like. We can’t imagine that Grooveshark is paying better than Spotify and that’s only for those artists who may actually have a valid license from Grooveshark.

As of this writing Grooveshark is still embattled in a number of lawsuits, which at one time included every major label. Essentially Grooveshark designed their business to be like an audio and music only version of YouTube. We detailed their practices in the post “Grooveshark, Notice and Shakedown”.

We don’t know how much money Grooveshark is making, but it’s enough to put the companies founders on the Forbes 30 Under 30 List… It seems that it is the (new boss) gatekeepers controlling the money and once again it is the artists themselves getting screwed.

PANDORA:

As of this writing Pandora has abandoned it’s ill conceived attempt at legislation that would have reduced artists royalties by 85%. But let us not forget that the arguments used by Pandora for attempting that move were also motivated by the downward economic pressure placed on artists whereby the majority of music consumption is happening with no compensation at all due to various forms of Ad Funded Piracy.

Welcome to the Exploitation Economy.

We suggest that artists focus on the disease that is creating the symptoms of businesses like Spotify.

RELATED:

Google, Advertising, Money and Piracy. A History of Wrongdoing Exposed.

Lou Reed and Dead Kennedys Go Public Against Ad Funded Piracy with Facebook Posts


The music industry may be streaming towards a cliff | Business Spectator

In August the cellist Zoe Keating published a spreadsheet of her earnings from various streaming sites. In the first half of 2013 she scored 232,000 streams, for which she was paid $906.41.

I used the word “legitimate” above because by far the biggest “publisher” of music is BitTorrent, which is simply the internet protocol for enabling peer to peer sharing of files, and the foundation of Napster’s many successors. Some people I know have zettabytes of music and movies they have downloaded; BitTorrent has been estimated to account for as much as 70 per cent of all global internet traffic.

READ THE FULL POST AT THE BUSINESS SPECTATOR:
http://www.businessspectator.com.au/article/2013/10/9/information-technology/music-industry-may-be-streaming-towards-cliff

Thom Yorke, Trent Reznor and a Chorus of Artists Speak Out For An Ethical and Sustainable Internet

Perhaps 2013 will be the year that we see as the tipping point in artists rights advocacy for an ethical and sustainable internet. There have been more artists speaking up vocally this year than we can remember over the last decade. The hangover from an excess of hope that the internet would empower musicians has begun to set in as the evidence of more, and worse exploitation becomes increasingly obvious every day.

Radiohead’s Thom Yorke noted his realization about Google and other big tech companies.

“[Big Tech] have to keep commodifying things to keep the share price up, but in doing so they have made all content, including music and newspapers, worthless, in order to make their billions. And this is what we want?

“We were so into the net around the time of Kid A,” he says. “Really thought it might be an amazing way of connecting and communicating. And then very quickly we started having meetings where people started talking about what we did as ‘content’. They would show us letters from big media companies offering us millions in some mobile phone deal or whatever it was, and they would say all they need is some content. I was like, what is this ‘content’ which you describe? Just a filling of time and space with stuff, emotion, so you can sell it?”

Nine Inch Nails frontman Trent Reznor has also been outspoken this year commenting first on streaming services, and then later on the value of music.

“I know that what we’re doing flies in the face of the Kickstarter Amanda-Palmer-Start-a-Revolution thing, which is fine for her, but I’m not super-comfortable with the idea of Ziggy Stardust shaking his cup for scraps. I’m not saying offering things for free or pay-what-you-can is wrong. I’m saying my personal feeling is that my album’s not a dime. It’s not a buck. I made it as well as I could, and it costs 10 bucks, or go fuck yourself.”

Jerry Cantrell of Alice In Chains refused to play new songs in the bands live set until the new album is released to protect the integrity of the bands work.

“Well, in the old days – if you start out with ‘in the old days,’ you’re totally an old f–k – you were able to play a lot more stuff live,” Cantrell tells Spin magazine. “But with the advent of the Internet and sharing and shit going everywhere, you can’t do that anymore. We really haven’t been playing anything off the new record that’s not out yet. We’ve been playing ‘Hollow‘ and ‘Stone,’ and now that it’s going to be released, we’re thinking about whipping out ‘Phantom Limb‘ and maybe a few more.”

Quincy Jones discussed his legacy and the challenges presented for new artists in an environment of unprecedented piracy.

What’s sad is that there is 98 percent music piracy everywhere on the planet. It’s just terrible. What if these kids (who download music illegally) worked for me for two months and then I said, “I’m not going to pay you.” That’s just not right.

Aimee Mann brought a lawsuit against a digital distributor.

Guy Marchais of the band Suffocation showed fans how to buy a CD and explained the importance of supporting artists with legal purchases.

Marc Ribot of Ceramic Dog (and sideman for Tom Waits) took up the battle against Ad Funded Piracy.

We don’t know what the ultimate solution is — but we know it isn’t the impoverishment of musicians and defunding music. And we know it isn’t pretending that no-one is being hurt. Corporations are making huge profits from the ads on ‘free’ sites, from selling the hard and software that make illegal downloading possible.

Austin band Quiet Company noted their disappointment after an internet marketing partnership experiment.

““After everything, I’m not sure there is a new model. The old model is still the model, it’s just that the Internet made it way worse.”

East Bay Ray of the Dead Kennedys noted who is making money and who is not at SF Music Tech.

“There’s opportunists on the Internet that have taken advantage of the artists, [they’re] giving a free ride on a carnival horse, but they’re starving the horse.”

Zoe Keating spoke to the NY Times about how artists in certain genre’s such as classic and jazz maybe condemmed to poverty in the new digital economy without better mechanisms in place.

“In certain types of music, like classical or jazz, we are condemning them to poverty if this is going to be the only way people consume music.”

Blake Morgan went public with an email exchange between him and Tim Westergren over Pandora’s attempts to reduced already low royalties to artists.

I hear you when you say you’re “seeking a balanced structure that allows musicians to generously participate in the business.” But respectfully –– and this is quite important –– musicians are what your business is built on.

Without us, you don’t have a business.

Victoria Aitken wrote about the effects of piracy on EDM artists.

“The Internet pirates have made me, and thousands of other musicians, walk the plank. We now have to swim in shark-infested waters where the big fish gobble up our dues and the pirates laugh their way to the bank.

I believe this basic injustice must be remedied – Internet pirates are white-collar criminals. They should pay the royalties they have stolen or be answerable to the law, like looters, burglars, and fraudsters.”

Pink Floyd expressed their feelings about Pandora and digital royalty rates for the next generation of musicians.

It’s a matter of principle for us. We hope that many online and mobile music services can give fans and artists the music they want, when they want it, at price points that work. But those same services should fairly pay the artists and creators who make the music at the core of their businesses.

Martha Reeves also explained the importance to continue to work towards fair royalties for artists in the new digital economy.

Musicians should be paid a fair value for their work and all digital services should play by the same rules. These are just common sense ideas, and once Congress adopts them as law, future generations will wonder why we ever struggled over them. But that’s why we must keep struggling – until justice is done.

Shawn Drover drummer for Megadeth responded to a question asking if the band had been effected by piracy.

Of course it is. We are certainly thrilled to have a #6 record on Billboard in America and #4 in Canada, but sales are way down for the entire music industry right across the board, which is a real drag. Internet piracy, torrent sites and all that are the reason why. Concert attendance for us is still great around the world, so we are definitely happy about that.

Thom Yorke Vs Spotify : Why Doesn’t Spotify Speak Out Against Ad Funded Piracy?

Thom Yorke’s announcement to boycott Spotify is just the latest public acknowledgement that the pay rates and business models of streaming services need to adapt and evolve to pay sustainable rates to artists and rights holders. We’ve previously offered our own point of view on Spotify whereby we believe that current streaming based models are fundamentally flawed at the level of their pay rates and are especially devastating to developing artists.

Both Thom Yorke of Radiohead and Trent Rezenor of Nine Inch Nails were two of the first artists to explore and experiment with potentially new music business models on the internet. However, the realities of those experiments have become apparent this year as Thom Yorke spoke out about Google and Trent Reznor against music streaming services being unfair to artists.

But it’s also important to remember that despite our disagreements over the revenue distribution models of Spotify and Pandora these are legal and licensed services. The primary reason that these streaming businesses even exist is in response to a decade plus of infringing and illegally operating business who pay nothing at all, zero, zilch, nada.

Let’s get really real for one second… One of the primary reasons Spotify pays so little is because so many more pay nothing at all. Google alone is tracking millions and millions of infringement notices to over 200,000 known illegally operating businesses.

For those who unaware, Ad Sponsored Piracy is the mechanism by which illegal and infringing online businesses get paid to display advertising on their sites. These sites do not license any of the music they distribute nor do they share any of this revenue with artists or rights holders. In other words Silicon Valley corporate interests pocket 100% of the money and pay artists nothing.

Simply put, ad supported piracy is the practice whereby ad networks like Google’s Adsense profit by placing ads on pirate sites like www mp3skull com.

Brand $$$-> Ad Agency $$$-> On Line Ad Services $$$-> Ad Exchanges $$$-> Illegal and Infringing Sites Profit from Ad Placements.

Any legally licensed, legitimate internet music business has to acknowledge that mass scale, enterprise level, commercial infringement of music only harms their business. The devaluation of advertising inventory on infringing sites harms both the legitimate businesses ability to grow, and the ability to pay sustainable rates to musicians.

So why doesn’t Spotify join with artists by insisting on better controls and regulation of online advertising? Spotify’s existence alone is not the solution as the payments to artists and rights holders simply do not scale as we have previously pointed out (also note how much less YouTube pays than Spotify – more on this later).

Music Streaming Math, Can It All Add Up?

Maybe we’re missing something. If streaming is the future how does $2.5b in revenue from a massively successful Spotify replace the loss of $8.3b in annual earnings?

Solutions for Artist Rights must include the acknowledgement that the mathematical facts of streaming services is that they are unsustainable at current rates (see chart above). Therefore, there must be regulatory enforcement to protect artists and other creators (authors, filmmakers, etc) from Ad Sponsored Piracy.

We have previous identified over 50 Major Brands Supporting Illegal and Infringing online businesses here:

Over 50 Major Brands Supporting Music Piracy, It’s Big Business!

See more Corporate Advertising Funded Exploitation of Artists:
Tom Waits * Neil Young * Aimee Mann * Neko Case * U2 * Ben Gibbard/Death Cab For Cutie * East Bay Ray / Dead Kennedy’s * Billy Corgan/Smashing Pumpkins