Music Technology Policy

I think we’ve all known people who have an obsession. In my business, it’s usually substances or sex. The causes of your own obsessions are usually hard enough to discover, and finding out why someone else has obsessions is next to impossible outside of the professional setting. Manifestations of obsessive behavior, however, are usually pretty easy to spot. Recall the times you described someone you knew as having a wild hair somewhere. You usually reach for that kind of description to explain otherwise inexplicable behavior.

So it is for me with The Lessig. I read his analysis of important issues of the day if you are someone who makes their living from creating music, for example, and I keep asking myself what did we do to him? We must have done something to deeply offend him, because he sure does have it in for us. I’m not sure I’ll ever know what it was, but it was definitely some deeply penetrating encounter that has cemented a wild hair firmly in place in young LL.

The problem with this is that in his zeal to really screw up my business and my friends, Lessig frequently glosses over obvious—I would think—criticisms of his argumentation, or, worse yet—facts. Now facts are nasty little things that come back to bite, and bite hard. It’s very important to deal with facts that cut against you when you’re engaging in this argumentation thing.Orphan works is one of these. I would suggest that the lynchpin of Lessig’s orphan works arguments is his contention that it is hard to find copyright owners. This comes up again and again and again in his various arguments in favor of his benefactor Google, particularly his apologia for Google Print. Of course, it’s not that hard to find copyright owners, people have been doing it for years, and a cottage industry has developed around finding copyright owners, particularly for books.

Lessig NEVER mentions this. These are the facts and they are indisputable.It’s very easy for someone outside or with an adjunct relationship to the academy to be critical of professors as living in ivory towers. That would be an easy criticism of Lessig. Which may also have the benefit of being true, which is always nice. I would suggest that in this case it is precisely because he is in the ivory tower that we should have a greater expectation of his scholarship and argumentation, because he gets millions of dollars—well, not HIM, but his projects, as far as I know—from his corporate benefactor Google (among others) to write this stuff. One would expect that an intellectually interested and honest person in academia to say to himself that he had to deal with the obvious to be taken seriously, if not to avoid looking like a boob.

In fact, I think it’s fair to say that the fact that the Thompson & Thompson company exists, or that there is such a thing as a Brylawski Report, or that movie studios research copyright in great detail to make sure they are acquiring rights from the right person, or that the Copyright Office records are searched every day by people trying to find a copyright owner for a variety of reasons—shall I go on?—are all facts that we can expect a researcher to discover with the most idle and trivial inquiry.

In the case of books, The Lessig argues that it’s impossible to find out who owns the copyright in out of print books which he casually describes as “orphans”. Don’t miss that. In reality (remember that?) an out of print book is simply a book that was in print before the publisher stopped making copies, or stopped making copies in a particular country. The book could have been in print yesterday, and is taken out of print today. According to The Lessig, once a book is taken out of print—POOF—can’t find out who owns it anymore. Now physical books are very traditional things. A book published today doesn’t look that different than a book published ten years ago, 100 years ago, and maybe even 1,000 years ago. There is one person who is interested in having a certain piece of information travel with that book—the author. Oh, most definitely. So you can almost always find out who wrote a book if you have—as Google does—a physical copy of the book. There’s this thing called a title page and if you look at that page you will know the author’s name in, I would submit a guess, 99.99% of the cases.

If the particular book you are looking at was published any time in the last few hundred years, just turn that first page over and—drum roll—you will very likely find a copyright notice. And if the book is still in copyright, there is a high degree of certainty that you will be able to find the publisher from that copyright notice or somewhere else in the first couple pages—conveniently searchable courtesy of Google Print—and you can probably call New York or London directory assistance and track down the publisher. If the book has been assigned in a catalog sale or some other transaction and the publisher has gone out of business, a quick Google search will probably yield some information about what happened to the publisher. If that fails, a Lexis Nexis search might do it, and if that fails you can hire Thompson & Thompson for a few hundred dollars to find it for you or get the best information you can.

If you find the publisher, you can call the rights department and they’ll tell you whether they still own it, and if they don’t, who they think does. They may take a minute to answer that question, or you may have to write a letter, but you will eventually get your answer, and probably in weeks and not months.

In fact, Internet search engines have been a boon to those searching for information on chain of title, a search that is done on every title every time a catalog of copyrighted works changes hands (except in the unusual case where a quitclaim is accepted, and even then some rudimentary diligence is usually performed to avoid buying a pig in a poke). So for Google’s greatest defender to argue that it’s just too hard to find this information is kind of funny.To say that you simply can’t find the owners of these works is really hogwash. Or to say that it is too hard to do is also hogwash as it is done every day. To believe otherwise is to have such a low tolerance for work that you expect to have an instantaneous response to every question you might ask. That would be nice, but the cost of doing it would likely be prohibitive—or someone would have done it already.

The problem is that when The Lessig makes these statements he does so most frequently in controlled setting—his favorite. This would be a setting where he is either surrounded by his fans who are ignorant of the business he seeks to crush and only to glad to savage anyone who would deign to oppose the Godlike one (see the passage from Free Culture quoted in Children of a Lessig God for his professor envy). Now there’s some academic freedom for you.When it comes to music and movies, it’s even easier to get some information about a work, particularly if you know the work involved. ASCAP, BMI, SESAC all have online searchable databases for songs, and SoundExchange has something close to that for sound recordings.

What irks me about this is that The Lessig MUST know about these search services. I can’t imagine it’s possible that he is that sheltered. I also believe that there is no reason why his students would know about these things. Students rely on their professors to steer them right, correctly or incorrectly. What stumps me though is that I can’t understand how either professor or student doesn’t know about copyright notices in books, but having dealt with the instant gratification crowd, I can easily imagine that they would not want to go to the trouble of using the industry standard search service utilized by careful lawyers who want to properly advise their clients of their rights.

The question that Lessig doesn’t answer—or anyone else for that matter—is what doyou do when you don’t know what a work is. For example, if you encountered a sound recording that had the following lyric, what would you search for?

There’s something happening here
What it is ain’t exactly clear
There’s a man with a gun over there
A-telling me I got to beware
Stop, children what’s that sound, everybody look what’s going down.

I can tell you that you could try to tease out a search term of any lyric in that song to put into any database and you would fail. That’s because the song has a title that is only abstractly related to the “hook” and is called “For What It’s Worth” and was originally recorded by the Buffalo Springfield.

So if you’re going to search for that song—or a recording of that song—you’d be hard pressed to do it unless you were able to get down into the “DNA” of the recording and search for the audio fingerprint of the recording by making an audio fingerprint of the recording you are researching. When you actually set about looking for a true orphan work—a work that is not being coyly characterized as “orphan” so that Lessig can coquettishly feed his obsession with bringing down the music industry—it’s not so simple. The typical search services won’t help you because they all presuppose that you either know or have a pretty good idea of what you are looking for.

So you have to ask yourself the question, why are we engaging in this exercise? Is the world waiting for what will be a very expensive database of audio fingerprints for sound recordings? Can’t Google look at the copyright notices in the books it’s scanned? What about photographs, illustrations, movies and the like? How on earth can you scan for these things? I would submit to you that a large part of the orphan works “dilemma” is a false dilemma—we have made it through hundreds of years of copyright without this issue ever coming up in any meaningful way. However, if you are trying to find more and more ways to break down private property rights, copyrights, media companies, and ultimately artists and songwriters, this is not a bad angle of attack and could well be one of the thousand cuts.

Because if you can argue that a work is an “orphan” just because a books is out of print as Lessig states in one of his communications from the madrassah, then that is a gigantic hole in the armor through which Lessig will seek to bury his sword in some obsessive retribution for an unknown wrong done to him.

A few months ago, I speculated that Google was using its interpretation of the DMCA as a tool to shakedown content owners tired of the pain of chasing infringing videos off of YouTube. There is a news story today that gives some insight into Google’s negotiations with Viacom: Google will only agree to protect copyrighted works from YouTube if you make a deal with them, likened to a “mafia shakedown”. (Note that I kind of skip over the fact that the deals are with YouTube, and fair enough, Google is keeping YouTube at a distance, a safe distance they think. However, it is so patently obvious that Google is trying to set precedent with YouTube that Google will enjoy, it’s almost not worth mentioning the Mallrats Go to Ft. Knox.) So—even though they could filter (or so they say), they won’t unless you give them a deal. We have a word for this where I come from, but we are just simple country folk unskilled in the complexities of the big city life.

Shakedown.

It’s funny, when you see Sergei and Larry out about town, they look like your average socially inept geeks. They clean up well, but they don’t look that different than many other ring dingers you see around the Valley, having breakfast at Buck’s and so on. They don’t look like mobsters or con artists.

Shakedown. No, actually—“mafia shakedown”.

I don’t seem to be able to find that word or concept in the legislative history around the DMCA. Funny, that—it’s just not there. I also am wondering what Judge Patel would have said in the Napster case if Napster had taken the position that they could filter but wouldn’t filter unless the copyright owner made it worth their while. I guess it’s different spanks for different ranks in the Google Nation.

So here’s a slightly revised version of my rendering of Google’s new interpretation of the DMCA now that there is confirmation that Google is using the DMCA as a shakedown tool—correction—a “mafia shakedown” tool:

Step 1: You create the art;

Step 2: Google steals it from you;

Step 3: Google makes you chase them to take it down;

Step 4: If you can afford to chase Google to try to make Google take it down and Google does take it down, the work Google stole will suddenly reappear—unless you make a deal with Google that allows them to exploit your art work, and then they will give you access to their filtering techniques—which it is not in their interest to have work any too well (but of course they already have you in a contract);

Step 5: See Step 3;

Step 6: See Step 4;

Step 7: See Step 3;

Step 8: See Step 4;

Step 9: See Step 3;

Step 10: See Step 4;

Step 11: See Step 3;

Step 12: See Step 4;

Step 13: Tired of this yet?

Step 14: See Step 3;

Step 15: See Step 4;

Step 16: Tired of this yet? Got any money left?

Step 17: See Step 3;

Step 18: See Step 4;

Step 19: Now if you’re tired of this, or you don’t have any money left (and since we are billionaires) what we could do little artist is give you a share of the advertising revenue we are/could be selling on the pages with your artistic works. Approval over advertisers? Oh, no, we don’t do that. And of course we will do whatever we want to try to commercialize your name, likeness, song titles, genres, and the clothes that you wear. And that revenue share? We’ll decide what’s fair because we are Google and we do no evil And if you don’t make our deal, we will not filter your content out of our systems.

Now there’s no need for name calling, we certainly don’t think we’re philistine cretins with as much appreciation for art as a stuck pig. We’re Google and we do no evil.

The DMCA is designed for people to behave reasonably—it is not an alibi. What we should have learned from observation is that there is a certain element of the Web 2.0 crowd who has no intention of behaving reasonably, and fully intends to steal from us to profit themselves. Their name is Google, and they are hiding behind the DMCA notice and takedown provisions to do it.

And don’t believe that “do no evil” bunk—they do evil all the live long day, they just have a singular inability to examine their own hearts and actions over there in Jonestown at Mountain View. It’s kind of what you’d expect from people who think the Leland Stanford Junior University Marching Band is cool after the first sixty seconds.

If you don’t believe me, see step 19.

The math is actually quite simple and consists of the following bright and shiny objects: Revenue, Costs and Profits.

The general idea is to keep revenue high, costs low and profits at least in line with your industry or preferably better. This is also known as the “hey, idiot” school of business or the 5 second MBA: buy low, sell high. (Nothing against MBAs, I have one, but I try to keep it in perspective.)

Revenue: Revenue in its purest form (before all the Enron accounting tricks) is simply what you make when you sell goods or services. In the record business, it’s the total of all the sources of money, like record sales, master licenses for film and TV, advertising, compilations, and so on. It can also include things like gains from selling a catalog, settlements or judgments for copyright infringement lawsuits, and other one-time payments to the record company.

When people say the industry is down 20% on the year, this is the number they’re talking about as a general rule.

This is the number you can’t play with very much because you either have it or you don’t, and it’s either going up or it’s going down. When you have hits, it’s high. When you don’t, you live off your catalog. It’s really very simple.

Revenues are also a way to measure the performance of the company’s managers. It’s not the only way, because it’s also important what you do with Revenues once you get them. But it’s a very important metric, because if that Revenue line isn’t growing, or worse yet if it’s declining, that means that the people making the decisions about what to do with the corporation’s assets are screwing the pooch as the pilots say. And sharply declining revenues eight years in a row are probably a textbook definition of pooch screwing.

Costs: Costs include A&R expenses (our R&D), marketing, promotion, tour support, royalty payments, mechanical royalty payments, salaries and benefits, rent, and—travel and entertainment. Costs are what produce Revenue. You can’t have Revenue (or at least you can’t have growth in Revenue) without Costs. You’ve heard this around the dinner table, or some other place where children learn business lessons in the form of the old chestnut: You Have to Spend Money to Make Money. Again, the 5 second MBA.

In this environment, you hear a lot about “cutting costs”. Sounds good, doesn’t it? Lots of testosterone in that phrase, lots of phallic imagery. Don’t put that cost up here, I’ll it cut off, you wimp. We’re tough guys, we will cut [everyone else’s] costs.

There is no greater human cost to the record company organization that cutting costs, which almost always means cutting people. And eventually you have cut so many people that if you even managed to stumble into a hit accidentally, or, God forbid, more than one hit at the same time, you wouldn’t have anyone to work the records. If you run a record company and you take a product manager who was responsible for ten records and did a great job, and give them 40 records only to find that they suck, don’t blame them. Not unless you’re already working for $1 a year.

Profits: What’s left from Revenues after you deduct Costs. In public companies this is often expressed as “earnings per share”, and a lot of analysts focus on this number—but it’s just one metric for measuring performance. “Profit” and “Earnings” sound like a good thing, and certainly it’s true that on balance it’s better to make money than lose money. But—if Revenues decline and you cut costs to boost profits and tell your stockholders that things are great because Profits are up, that’s not really very honest, is it? Particularly if your bonus is tied to—Profits.

Profits are really the only thing that marginally talented executives who have inherited the work product of generations of artists and record men can futz with in order to make it appear that they know what they’re doing. It’s also the kind of “buy low, sell high” concept that you can get your mind around in that golden hour between the time that last night’s hangover wears off and you start drinking at lunch (on the company, of course), before you go out drinking after what passes for “work” in certain circles. It’s easy.

And after a number of years of artificial “profits” pumped up by cutting Costs, don’t be surprised if there’s not much left in the organization that looks like a record company. Oh, and also don’t be surprised if no one with any talent wants to work for you or sign with you, no matter what your last lap dance told you.