News from the Goolag: There’s vapor in that cloud: Google Music on Tornado Watch–no deals with publishers

Tornado Watch:  The year-end spin machine is in motion on the Google Music front.  Business Insider reports that “Google is ready to write huge checks for Google Music” (which ran on SF Gate). 

What’s a “huge check”?  “Tens of millions.”  Wow.  On an industry-wide basis?  Golly, that’s so much money, what would we ever do with it all?

And then there’s this spin we spotted in the Tornado Watch:

“Google has not really started to negotiate with music publishers, who own a different set of rights for most music recordings–part of the insane complexity of music licensing. That will increase costs further.”

There’s some solid objective reporting–“insane complexity of music licensing”.  I wonder if that came straight from the talking points?

So think that through:  “Google has not really started to negotiate with music publishers.”  So what does “really” mean?  The rumor is that Google is going around to visit publishers and instructing them as to what their deal will be for the privilege of participating in Google Music, and if they don’t like the terms, Google then gives them a power point show of exactly how Google will do what they want to do anyway, and lays out all their legal defenses.

And in case you haven’t noticed, Google spent $100 million fighting the Viacom-NMPA case against Google over YouTube.  Not to mention running roughshod over music publishers’ print rights in the Google Books fiasco.  So once again, it appears that Google is offering up an insulting situation relying on their market dominance in search.

And then the Business Insider spinner disdainfully refers to publishers as “further” increasing the costs of launching the service.  Here’s a hot tip–the publishers and songwriters control the songs.  You know, the thing that drives the whole machine.  So they are not a “further” cost, they are probably the most important cost, and if not they are certainly equally important.  And if my guess is correct, the major publishers will take the position that $10 million gets Google a meeting and then we’ll talk about a deal.

Here’s another hot tip for the journalistically challenged:  Not having the publishing cleared is your lead

No publishing, no service.

What is never mentioned in these stories is Google’s lack of understanding of the independent labels.  There is no reason why the indies always have to be an afterthought, particularly because time after time indies punch above their weight in online sales.  Pandora is a great example of this phenomenon.

I also love this part of the Business Insider story: “[A]t least three groups were fighting for control of Google Music and couldn’t agree on how to proceed.”  That tells me a couple things. 

First, Google is planning on doing to music what it’s done to other niche markets in search–using its market dominance to crush competition.  See the Wall Street Journal’s story Rivals Say Google Plays Favorites and Web Companies Fear Google’s Reach in the Washington Post.  Nobody inside Google is likely to care much about selling music as music, certainly not enough to have an internal turf war over it.

What is much more likely is that an internal struggle would break out over “non-display” uses of music–and the associated metadata, fingerprints, samples, previews.  All of which Google does not plan on paying a penny for (as they would have you believe that the fair use defense was created for multibillion dollar multinationals, not political commentary).  But all of the metadata, samples, previews, fingerprints, can be used to further train its search algorithm to further cement its place in search.

These non-display  uses are much closer to Google’s core mission of organizing the world’s information whether the world likes it or not.  Another thing that could get Google excited is that mixing up search results from illegal sites (a rumored $500 million source of revenue for them) would make it more likely that they could continue including search results from The Pirate Bay, Isohunt, et al and selling popup ads on Megaupload.

And these are the kinds of thing that could get Googlers excited, unless you think that these guys are people who secretly wish they were Barry in “High Fidelity”.  They’re not.

How many times have digital services been told over the years that the major labels didn’t want to create another MTV, that the services were building a business “on our backs”, digital cannibalized sales, and so on.  If any of that were true, where does handing over your catalog and your metadata to Google fit in that meme?

If Google Books is any guide, a deal with Google will make the cost of creating another MTV a rounding error on the paperclip budget—unless that deal is excruciatingly careful about issues like mixing illegal search results in with legal ones instead of filtering out the bad, as well as either a prohibition or compensation for non-display uses that Google can make of songs, sound recordings and music videos and their associated metadata in the background.  Not to mention the more obvious points.

So here’s the question that we in the music business have to ask ourselves.  In our haste to try to create a counterbalance to iTunes (a motivation I frankly do not understand given that Apple has such a long history of embracing creatives), are people actually thinking that Google is a savior?  At the same time as Google is fighting the music publishers in the YouTube case with amnesia, missing laptops and $100 million in legal fees raised from the public markets?

That is simply insane.