Given Apple’s well-publicized announcement of its fully licensed cloud music service, the Google Music negotiation team must be under tremendous pressure to explain away their failure to close even one license. The latest revision of the narrative as dutifully reported is that Google offered the major labels (i.e., not the indies, independent artists or the songwriters) $100 million dollars for the rights to Google’s cloud music service. Although it’s impossible to tell from the reporting what rights were covered (why ask that question), this $100 million dollars apparently was for the artists and record companies for something like 5 million recordings.
Given that the narrative unquestioningly would have the public believe that (a) $100 million is such a pile of money, and (b) the “record labels” are greedy neanderthals who are harming their artists by trying to extract more money from Google and get assurances that Google will fight piracy aggressively, let’s take a look at what that $100 million really means.
–Google is reported to have spent $100 million in legal fees through the trial court in YouTube v. Viacom in defending their policy of screwing artists. So $100 million is the price of Google’s legal fees in one–one–of Google’s many, many lawsuits designed to undermine property rights to hurt creators. By comparison, I wonder how much they are spending on their illegal book scanning business and now on Google Art Project that is finally seeking to profit Google from visual fine artists, not to mention their many, many other lawsuits as they organize the world’s information against the world’s wishes (the most recent of which is defending separate lawsuits from Oracle and Paypal that Google “organized”–that is, stole–their technology, too).
–If the major labels include the customary clearance package, Google will clear about 5 million tracks for their $100 million. So that’s (an advance presumably, of) $20 a track, all in. Wow. Who’s buying dinner at Mickey D’s?
–Google has probably done what it usually does–have a big whiz bang front end with short shrift given to accounting to the artists and songwriters that make the trains run at the chocolate factory. Like building an automated grocery store with no cash registers or restocking. So that $100 million may be the only money we ever see.
–Google made $30 billion or so off of advertising last year. That’s $82 million a day. So Google makes that $100 million in 29 hours. Since the idea of advertising-free music is becoming a thing of the past, I wonder how long it will take for Google to recover that $100 million cash on cash from its ad inventory on illegal music sites? Any bets on 72 hours? What’s the over/under on a week?
–to be fair, Google reported only $5 million in lobbying against our interests in Washington DC. (That’s US federal-level lobbying only and does not include state-level lobbying or the company’s international lobbying for efforts like the Hargreaves Report.) Even if you extrapolate what they’re spending on influencing governments against our interests around the world, it’s probably only $50 million or so. But of course it’s hard to put a number on the value was of having their former worldwide head of lobbying working in the US government and the value of Rachel Whetstone in the UK all working feverishly against our interests. So that $100 million (which is likely an advance, so Google will get that money back) barely covers the money they spend lobbying against us for a year or so.
–Google’s executive chairman warns the representatives of the people not to pass “foolish” laws–meaning laws Google doesn’t like–and that Google will “fight” those laws. Everywhere. (Pretty much what the founder of the Swedish Pirate Party says, so may be an indication of what Lessig is advising in the background–see Lessig, “The Starving Artist Canard“.) First and foremost this means that Google will continue its unrelenting use of stockholder money to undermine the property rights system that creators and other working people rely on to feed their families. It is not surprising that the non-union Google has no interest in helping working people.
I was at a conference recently with one of Google Music’s wunderkind who announced that all he had to do was get the majors on board and the “residual” will follow. This is the kind of arrogance that has spelled failure for the Google negotiation team. It would be one thing if Google had actually accomplished anything in their year or so of failing to close their licenses–failure we predicted before they even started. Actually–I take that back. They have accomplished something. They have convinced anyone who has come into contact with them that we need to keep our hand on our wallets and check the china and silver after Google leave the building. And keep them off of WiFi while they’re in your offices.
In fairness to Google, they are no different than companies like American Express who want artists to endorse their credit cards, but then stab us in the back when they fulfill sales on rogue sites. But when Google’s lead negotiator says things like “We want to help them sell their artists’ music and have a lot to offer given the broad reach of Android and Google generally”, you have to just laugh. Until Google demonstrates–beyond dropping one app from the piracy-riddled Android market–that they view their proposed music service as anything but a smoke screen to hide rampant ad-driven theft that they profit from, you can only continue to laugh. Or prosecute.
So $100 million? Chump change. What should $100 million buy you?
A meeting. They had their meeting. The real story here is that the industry would prefer to deal with honest people when possible. And it’s possible.
Acknowledging they are paying us with $100 million derived from what Rep. Debbie Wasserman-Schultz called “aiding and abetting theft” might be a good way to get a second meeting.