Martin Mills is Chairman of the Beggars Group, home to some of the best known brands in the music business–4AD, XL, Matador, and Rough Trade, as well as the Beggars Banquet catalog.  In addition to his companies, Martin is a leading advocate for independent record companies around the world.  He’s also a fine example of what used to be called a “records man”, a term you won’t find in Wikipedia.

Martin’s companies have a long history of finding and developing some of the most compelling artists in our business including Adele, Friendly Fires, Jack White, Radiohead, Thom Yorke, Atoms for Peace, Sigur Rós, The National, Interpol and Iron and Wine to name a few in no particular order.

I attended Martin’s keynote at Canadian Music Week on Thursday, and he gave me permission to reprint his speech.  Given the current attention devoted to copyright issues in the U.S. thanks to Chairman Bob Goodlatte and Register of Copyrights Maria Pallante, I’m going to post it in two parts.  Today’s post is actually the second part of Martin’s speech concerning the DMCA safe harbors, a topic that was the subject of a recent IP Subcommittee hearing in the House of Representatives.

We’ll post the first part about commercial balance in a coming discussion of commercial negotiations with online retailers.

This part will address the problems that Martin has with interpretations of the DMCA and notice and takedown-type statutes in various countries.  These interpretations, particularly by Google, go to the lack of respect for music and creators demonstrated by Google and in particular by YouTube.

Out of Balance: DMCA Abuse

I’d like to take a little time to say a few things.

I’m often asked what I actually do day to day, now that I have a company of 150 people taking care of things, and it’s not an easy question to answer.

But the answer is – balance.

I maintain many different balances, and that can be a subtle and delicate process.

Balance in personal relationships in the business.

Balance between the four labels in my family.

Balance between commercial needs and artistic integrity.

Balance between promotional opportunity and the need to maintain the value of our artists rights.

But we operate in an industry today that is out of balance. And we need a balanced industry like we need a balanced diet.

Imbalance in the Safe Harbors:  YouTube and Grooveshark Rely on Distorting the DMCA

[An] imbalance I want to talk about is the safe harbour provisions, and similar terms in other countries. They were introduced, with some foresight, by the legislators in the USA framing the DMCA, to provide a notice and take down procedure for unlicensed content. But the legislation has been distorted into a protective wall behind which cyberlockers and torrent sites, and companies such as YouTube and Grooveshark, operate.

The original intent was to protect reasonable people acting reasonably from falling foul of the law, to enable the digital economy to grow without “ gotcha “ law suits against ISP’s who had no idea that their networks were being used for infringement. They were not intended to provide fortress walls behind which companies could build billion dollar businesses on content that had not been cleared. They were never intended to become a de facto “ licence “.

To draw an offline analogy, these provisions would allow someone to burgle your house and remove its contents, with their only risk being that if you caught them, they’d have to return them – and maybe apologise. And then do it again. And again. And again.

Copyright is meant to allow you to control your own work. That is totally undermined when another law says that people in effect can ignore it with impunity. Would we consider a safe harbour law allowing small restaurants to ignore food hygiene laws ? Or a safe harbour for personal data being inappropriately used ? Of course not.

YouTube’s Distortion of Safe Harbors Harms the Indies Most

As you might imagine, policing the YouTubes of this world for infringing content is a herculean task, one beyond all but the largest of companies. For my community, the independents, it’s a game of whack-a-mole they can only lose.

These provisions are being abused. Many of the companies taking advantage of them are not start-ups that need a break, they dwarf everyone in this room. They’ve been in business long enough to now be able to identify that content. They know what it is.

They should not need that protection any more. Those provisions hobble creators, and they give those that use them an unfair competitive advantage over companies such as iTunes, Spotify, Amazon and Rdio who DO pre-licence content. Google says that safe harbours have been crucial not only to them but also to every other internet company. That’s not true. And Youtube says it’s paid out a billion dollars to music rights owners – but so has Spotify, from one thirtieth as many users. That economic discrepancy is because of the unreasonable economic advantage Youtube has over its digital service competitors because of its use of the safe harbour provisions.

Notice and Staydown:  US Copyright Reform Should Address DMCA Abuse and Restore Balance

The American government is increasingly looking at reforming copyright laws. As long as that reform creates a balance between strengthening copyright and allowing investment in the creative world, and adapting it to a world never envisaged, I support that intention. But I believe part of that change must be to remove the safe harbour loophole.

We are at the point at which notice and take down must become notice and stay down.

To conclude, whilst thanking you all again, I would like to quote from one company’s evidence to Australia’s Communication Ministry a few months ago.

 “ We believe there is significant, credible evidence emerging that online piracy is primarily an availability and pricing problem “

Whereas that might have been true ten years ago, today, in an era with myriad licensed services (and Australia has more than most ), and with streaming services with free tiers, I think that’s, frankly, rubbish.

Who was it from ? Google, the parent of YouTube, one of the companies that have made billions on the back of a statutory provision intended to protect ordinary people acting innocently.

Thank you.