Archive for November, 2014

Music Fan Survey Preliminary Results

November 18, 2014 2 comments

As some of you may have noticed, we are conducting a casual survey of music fans.  While we are still collecting data, here’s an interim look at a couple of the results.

I have to say that I’m not surprised by any of these results, but it is worth noting that some are wildly opposite to what some companies would have you believe (Pandora, Google, Sirius, Spotify).

Primary Source Interim


Monthly Streaming Spend Interim

streaming spend

Artists on Social Media Interim

social media detail

Public Citizen’s List of Examples of “Third Party” Groups to Which Google Provides Support

November 17, 2014 1 comment

As we know, Google spends hundreds of millions every year to extend its influence through government, academia and the media.  (Although sometimes with the media it extends its influence through theft wrapped in a bunch of excuses).

The venerated good government group Public Citizen released a comprehensive report entitled “Mission Creep-y” that measures many dimensions of Google’s influence in the US.  (“In the US” is an important qualifier–Google does much the same in major economies.)    In addition to the campaign contributions and lobbying spend that are largely public record, Public Citizen also focused on a largely unseen element of this influence–so called “third party” influence groups (often non-profits) that end up on Google’s side most of the time.  (See SOPA.)

Tax exempt nonprofits disclose their income on an IRS Form 990, but the one schedule that would be meaningful in evaluating the nonprofit’s bona fides is confidential.  That’s Schedule B to the Form 990 that lists big contributors.  For example, do you feel differently about Creative Commons knowing that Google gave the organization $1.5 million that we know of?

Creative Commons 2008 Schedule B

Or would you feel differently about Free Press if you knew that the organization had convened a meeting of interested tech folk at the San Francisco home of David Drummond to discuss how to pursue their agenda–with Professor Lawrence Lessig (himself the founder of Creative Commons and the Center for Internet and Society at Stanford which itself got $2 million from Google).  See the pattern here?

free press invitation 3

So Public Citizen has provided us with a list of the many organizations that Google gives money to in hopes of receiving favorable treatment.  See how many you recognize?

AARP Gay & Lesbian Victory Institute
Access Now George Mason University Law School Law and Econ. Center
American Action Forum Global Network Initiative
American Antitrust Institute Global Voices
American Association of People with Disabilities Heritage Action
American Conservative Union Heritage Foundation
American Constitution Society for Law and Policy Human Rights Campaign
American Council of the Blind Information Technology and Innovation Foundation
American Enterprise Institute for Public Policy Research International Center for Law and Economics
American Foundation for the Blind Internet Education Foundation
American Library Association Institute for IP and Social Justice at Howard Law School
Americans for Tax Reform iKeepSafe
Asian American Justice Center Joint Center for Political and Economic Studies
Asian Pacific American Institute for Congressional Studies The Latino Coalition
APAICS Leadership Network Leadership Conference on Civil and Human Rights
Aspen Institute League of United Latin American Citizens
American University Program on Information Justice and IP Mercatus Center
Boys & Girls Clubs of America National Association for the Advancement of Colored People
The Brookings Institution Nat’onal Assoc. of Latino Elected and Appointed Officials
California State University Northridge Foundation National Association of the Deaf
Capital Factory National Center for Missing & Exploited Children
CATO Institute National Consumers League
Center for a New American Security National Congress of American Indians
Center for American Progress Action Fund National Council of La Raza
Center for Democracy and Technology National Cyber Security Alliance
Center for the Rule of Law National Federation of the Blind
Center for Strategic and International Studies National Hispanic Media Coalition
Committee to Protect Journalists National League of Cities
Common Sense Media National Network to End Domestic Violence
Competitive Enterprise Institute National Taxpayers Union
Congressional Black Caucus Foundation National Urban League
Congressional Black Caucus Institute New America Foundation
Congressional Hispanic Caucus Institute Searle Center on Law, Regulation, and Economic Growth
Congressional Hispanic Leadership Institute PEN American Center
Congressional Institute People for the American Way
ConnectSafely Progressive Policy Institute
Constitution Project Public Knowledge
Consumer Action Reporters Without Borders
Consumer Federation of America Ripon Society
Council of Better Business Bureaus Inc. R Street Institute
Creative Commons Small Business Majority Foundation
Digital 4th TDI
Electronic Frontier Foundation TechFreedom
Engine Advoacy Technology Policy Institute
Enough is Enough Transparency International
Family Online Safety Institute U.S. Black Chamber Inc.
Federalist Society U.S. Conference of Mayors
Free State Foundation U.S. Hispanic Chamber of Commerce
Freedom House Washington Legal Foundation
Future of Music Coalition Wired Safety
Future of Privacy Forum Women’s High Tech Coalition

Timing is Everything: Sirius May be Barred from Appealing California Loss to Turtles #irespectmusic

November 15, 2014 1 comment

Rut ro.  For those of you following along, remember that Flo & Eddie won a tremendous victory against SiriusXM on a motion for summary judgement in federal court before U.S. District Judge Philip Gutierrez in California in a putative class action on behalf of all pre-72 recordings.

Sirius appealed the Turtles case.

Also recall that the major labels filed a separate case in California state court before California Superior Court Judge Mary H. Strobel.  The labels essentially won that case when California Judge Strobel followed similar reasoning to federal Judge Gutierrez .  However, the California judge handed down her opinion after Sirius filed its appeal in the federal case applying California law.

So because Sirius lost both cases, the Turtles may be able to stop the Sirius appeal in the band’s federal court case if they can rely on the decision in the major label State court case.

Two parallel cases in two different court systems, both interpreting California law.

Here’s where it gets interesting.

Before federal Judge Gutierrez decided the Turtles federal case, California Judge Strobel in the major label case issued a preliminary ruling that looked like the court was going to rule against the major labels.  Lucky for them, the artists got a favorable decision first, and lucky for everyone except Sirius, the California Judge Strobel in the major label case reversed her preliminary ruling tilting against the labels and adopted federal Judge Gutierrez’s argument as a matter of California law.

But–in its appeal, Sirius is essentially asking the 9th Circuit for rule on what the California law would be–except that after Sirius filed its appeal, we got California Judge Strobel ‘s ruling.  So we now know what the California law is in fact, after the appeal was filed with federal Judge Gutierrez, but before he ruled on the appeal.

Law360 explains further:

“The ‘tentative’ ruling in the [labels’] case which Sirius XM claimed reached an ‘opposite conclusion’ had ceased to be tentative and, more importantly, had ceased to be opposite,” the [Turtles] filing said.

“Sirius XM claimed not to know about the falsity of its representations when it filed its motion. However, even under its own explanation, it knew within minutes of its filing — and it also knew that the false statements were the foundation for its motion,” The Turtles said. “Yet, rather than withdrawing its motion, Sirius XM insisted on proceeding with it even though it had no factual basis and even less of a legal basis”….

To win an immediate appeal of that decision, Sirius is going to have to prove more than just a judicial conflict over the issue. It’ll also have to show that such a move would be likely to speed up the case — another hurdle The Turtles said [in their filing] that Sirius couldn’t meet.

“Although their music is timeless, the artists who created pre-1972 recordings are aging and depend on the royalties from a marketplace that has been ravaged by piracy,” the filing said. “The artists who hope to benefit from this litigation are necessarily going to suffer tremendously from the delay that would result from an interlocutory appeal.”

The split between Judge Gutierrez’s decision and the tentative ruling weeks prior from Judge Strobel was initially a kind of silver lining for Sirius after the sound defeat in federal court. That changed on October 15th, when Judge Strobel heavily cited Judge Gutierrez’s decision in reversing course.

So Sirius may not be able to appeal the ruling against them by Judge Gutierrez and may have to move on to the damages phase of the case.  (Sirius may be able to appeal later on a different basis.)  More intrepid lawyering by Henry Gradstein and Harvey Geller.  And when you find Google Shill Listers referring to Flo & Eddie as “the company that owns the Turtles recordings”, i.e., spinning a holding company solely owned by Mark Volman and Howard Kayman rather than acknowledging an artist victory, you know that artists are winning.

Also realize that Gradstein and Geller also sued Pandora on the same issues in the same federal court where they had just won a favorable ruling from federal Judge Gutierrez.  And it’s all just a brilliant bit of lawyering.

Why is Sirius continuing this scorched earth policy against old guys and dead cats?  Time to settle your case folks.

Also recall that SoundExchange backed the RESPECT Act that will almost certainly be reintroduced in the next Congress (i.e., after Congress returns in January).  The RESPECT Act would fix the pre-72 issue for digital performances.  Sirius and Pandora had both opposed the RESPECT Act on the bizarre grounds that the Congress intended to screw the creators of our legacy of recorded music out of royalties for webcasting and simulcasting.

Of course the most Orwellian part of especially Pandora’s opposition to the RESPECT Act is because they wanted to help artists.  Yes, that’s right.  They wanted to help artists with something called “full federalization”.  Well, they got full federalization alright, just not in the location they were expecting it.

As a great drummer used to say, it’s all in the wrist.

Here are links to the documents:

Turtles Opposition to Sirius Appeal CA 031120007391

Flo Eddie v Pandora

#irespectmusic Turtles Win in New York pre-72 Case Against SiriusXM

November 14, 2014 1 comment

More to follow, but the Turtles win another one for all pre-72 artists in federal court in New York applying New York state copyright law.  Yet more intrepid lawyering by Henry Gradstein and Harvey Geller who also won the Turtles case in California.  Brown shoes don’t make it, baby.

Turtles NY Memorandum and Order Denying Defendant’s Motion for Summary Judgement

See also:

Timing is Everything: Sirius May be Barred from Appealing California Loss to Turtles #irespectmusic

Mission Creep-y: @Public_Citizen Report Shows Google Uses Its Data Dominance to Become the Most Politically Powerful Corporation in the World

November 13, 2014 Comments off

The venerable Public Citizen organization has released a very scary report about Google’s political contributions and influence called “Mission Creep-y: Google Is Quietly Becoming One of the Nation’s Most Powerful Political Forces While Expanding Its Information-Collection Empire”  (get a free copy here).

The mind boggling amount of data that Google collects on anyone who touches their services from YouTube to search, Gmail to Google+, Google Apps for Education to Nest can easily be turned to Google’s advantage and the advantage of any candidate the company chooses to back.  And as the report proves, Google’s “soft power” allows it to influence elected officials–“Google’s soft power allows it to have its way with policy makers and other elites.”

Political spending is just one way Google influences policy makers. Another is through what has been termed “soft” power.327 Through having employees enter high positions in the federal government, hosting events for elites, and funding and supporting a diverse array of non-profits, Google accrues influence in ways that are much less visible and less regulated than through conventional lobbying and electioneering expenditures.

The phenomenon of former government employees becoming lobbyist for industries and businesses is commonly called the “revolving door.” Somewhat less publicized is the “reverse revolving door,” in which industry officials take positions in the government. These positions are typically in the highest echelons of government, often for relatively short-term appointed positions.

Many of the White House’s most prominent tech-related positions in recent years have been filled by former Google executives and employees.

As we noted in “Government Capture and Google’s Crony Capitalism Assault on America,” the list of Google employees in the executive branch is long and distinguished.  Here’s a handful:

President’s Council of Advisors on Science and Technology: Eric Schmidt (call sign “Uncle Sugar”)

Director of Google Ideas (and co-author with Uncle Sugar of The New Digital Age): Jared Cohen (formerly a member of the Secretary of State’s Policy Planning Staff and as an advisor to Condoleezza Rice and later Hillary Clinton).

Director of United States Patent and Trademark Office: Michelle Lee (formerly Google’s Head of Patents and Patent Strategy)

U.S. Chief Technology Officer: Megan Smith (formerly at Google[x])

Deputy U.S. Chief Technology Officer: Alexander Macgillivray (formerly Google’s point man on orphan works)

Director of Google Advanced Technology and Projects Group: Regina Dugan (former director of DARPA)

Director of U.S. Digital Service aka savior of (in case you couldn’t tell): Mikey Dickerson (former Site Reliability Manager at Google)

Special Assistant to Chairman, FCC: Sagar Doshi (Google Product Specialist)

YouTube Global Communications and Public Affairs Manager:  Chelsea Maugham (former U.S. State Dept. Chief of Staff)

Google Lobbyist: Katherine Oyama (former Associate Counsel to Vice President Joseph Biden)

Google Head of Global Development Initiatives: Sonal Shah (Advisory Board Member, Obama-Biden Transition Project)

Deputy U.S. Chief Technology Officer (White House): Nicole Wong (former Google Vice President & Deputy General Counsel)

And then there are dozens if not hundreds of former Hill staffers now working for Google’s DC shillery.

How does Google get away with it?

Google also has been adding to its soft power by courting influential national figures, such as by hosting an elite, unpublicized Google conference at a Sicilian resort, nicknamed by “the Davos of the summer” by a reporter for The New York Times. Google declined to comment to the Times on the exclusive summit, also known as “the Camp,” which attracted executives from politically active companies like Goldman Sachs, Deutsche Bank, Spanish banking giant Santander, as well as prominent members of the media, including Huffington Post founder Arianna Huffington, and investors and technology luminaries.

Google also earns a kind of soft political power from the nonprofits it funds through in- kind donations in the form of advertising, customized YouTube channels and website analytics, as well as funding fellowships for the groups.

This is a very well written and researched report by a highly credible organization that has devoted itself to the public interest for a very long time (since 1971).  Public Citizen doesn’t participate in political activities or endorse candidates, accepts no government or corporate money and relies on funding from a 300,000 membership and foundation grants.
I strongly recommend that anyone in the music business that touches Google read at least one section: Combining User Information Collected by Different Products.  It is through combining data harvested from all of Google’s products including search and YouTube that Google has achieved data dominance–control over so much data that no one can catch up to them.  And Google’s privacy policy expressly allows them to do it and the policy applies to all Google products.

One of those products is YouTube.  If you do business with YouTube, drive traffic to YouTube or post videos on YouTube or embed videos from YouTube then you are helping Google create data profiles on your fans including children.  Data profiles they combine with other data on those individuals collected from other places.

If you participate in Google’s Music Key product, then not only will they collect this data from users, they will be able to tie it to credit cards, mobile phones or Google accounts and combine that with all the other data it has collected on these individuals and identify them by name.

Face it–this is way beyond beyond “boxers or briefs.”  It’s way beyond letting MTV build a business on our backs. How much more dangerous do these people have to get before you wake up?

Think about that.

Slate Misses the Point on Google’s Data Domination

November 12, 2014 Comments off

Jordan Weissmann in Slate offered this explanation to explain what happened when Google’s ad servers “went down”:

As Napier Lopez succinctly put it on the blog of TNW during the outage, “It’s likely affecting millions of advertisements across the Web and could cause advertisers to lose a whole lot of money collectively.”

The company controls slightly less than a third of all digital advertising dollars but is probably even more dominant when it comes to serving display ads for online publishers (I haven’t been able to track down specific market-share data on that front). This isn’t necessarily a bad thing. Having an absolutely giant marketplace where websites and advertisers can buy and sell ad space makes the business more efficient. But if something goes wrong with Google’s hardware, the company apparently turns into the world’s most powerful ad blocker. [emphasis mine]

What do most people do when they pay for something that the supplier screws up?

Ask for a refund, maybe?

I don’t know advertising contracts, but I assume they have some kind of force majeure/massive failure/uptime loophole that Google would try to wriggle through.  Even so, if I’m an advertiser that spends a bunch of money with Google, or an ad agency like WPP, I want a make good or a refund.  Naturally, the little advertiser will be SOL, but then that’s Google.

However–it has to be a triumph of Google’s “catch me if you can” culture that the first thing that gets reported when Google screws up ad delivery is that the advertisers lose money.

And Weissmann misses the point entirely with his monopoly worship.  More efficient.  Is it also more efficient for one company to collect so much data that they have dominance over that space, too?

Much more efficient for the NSA, so that’s a good thing, right Mr. Weissmann?

#irespectmusic Blake Morgan on his CNN Interview and the Latest Spotify Debacle

November 11, 2014 Comments off
MTP: I watched your CNN interview with Poppy Harlow and you made some significant points that don’t get picked up much.  Let’s start with the last one:  Spotify could be the next Myspace.  I think we all remember when Myspace was viewed as the Second Coming and then one year it just evaporated.  I was trying to remember the CEO’s name. What about Spotify reminds you of Myspace?
Blake Morgan: The false idea that Spotify is inevitable and gargantuan. In fact, if they don’t evolve, they may find themselves more like Goliath. And we all know what happened to Goliath, right? If you don’t, just ask MySpace. Streaming is not itself in question here, any more than MySpace’s failure called the idea of social media into question. It didn’t. Its failure was a reflection on MySpace, and its model. Same thing here. Streaming may or may not be a viable future, but it won’t be if the people who make streaming services’ only product––music––don’t get paid fairly. It’s not a question of inevitability, it’s a question of a particular business model’s viability. Hence the cautionary comparison.
MTP: It seems like both were commoditizers.  It could be music or any other mass market good that is digitizable.  And Google the Great Commoditizer, the destroyer of worlds, was all up in Myspace and they’re all up in Spotify.  Maybe that tells us something about Spotify’s future?  Do you think they think Google actually cares whether Spotify is selling music or YouTube-style sex tourist home videos?
Morgan: I think Spotify has a lot of masters (pardon the recording-jargon pun), and Google being one of them does not surprise me. I think they’ve also drunk a lot of their own Kool-Aid over at Spotify. At the private artists-only meeting with them in NYC a few weeks ago I was at, the Spotify execs constantly pointed at YouTube and the people using YouTube as the bad guys. One exec said, “our competition is from people right-clicking on YouTube music videos and taking the audio.” I answered, “well then why don’t you call your buddies over at Google and have them just disable that function.” Response? Silence.
MTP: Another point you made that was especially compact was the break-even analysis for iTunes compared to Spotify.  I’m always amazed at how the business media or business school critics just completely ignore MBA 101 type break even analysis.  Want to go over the example you gave of recouping recording costs?
Morgan: Sure. So it’s common for a middle-class recording artist like myself to make a new record for around $15,000. On iTunes, that would mean you could sell 2,000-2,500 albums and break even. iTunes pays 70 cents for a 99 cent download, and $7.00 on a $9.99 priced album. The Spotify break-even equivalent, and this is even if you accept their per-stream estimate of half-a-cent-per-stream (it’s usually much lower), would be between 3,000,000 and 3,500,000 streams. Jason Aldean, a #1 Country Music artist, got a reported 3,000,000 total streams for his new album his first week on Spotify. That’s what it would take. Oh…by the way, he just pulled his new record from Spotify yesterday (insert smiley-face emoticon).
MTP: Do you think that straight news journalists know enough about the music business to be able to unpack the press releases they get?  I noticed that Ms. Harlow read a Spotify press release in the lead to your segment that started out stating that Kobalt earned more from Spotify in Europe than they did from iTunes.  That story line somehow expanded from a story about a publisher with a stable of writers who include some of the biggest songs of the current era that made more as a publisher from Spotify than they did as a publisher from iTunes into a story that sounded like Spotify paid more in royalties than iTunes.  Which we know is simply mathematically impossible.  I felt like Ms. Harlow, a very smart journalist, was getting conned by Spotify simply because she doesn’t understand the complexities of the music business.
Morgan: You know, so much of what’s changing in the current movement and groundswell from music makers about all this stuff is the understanding that winning the hearts and minds of music lovers is central. That’s what I’ve really tried to focus on myself, with #IRespectMusic. Congressmen and Congresswomen are music lovers. Legislators are music lovers. Teachers, radio hosts, club owners, guitar makers––they’re all music lovers. Journalists and news anchors are too, and Ms. Harlow was really clear, on the air and in the interview, that she too loves music. She, along with many others, are just now learning how music makers are paid (and not paid) for their work. She generously thanked me for presenting the arguments in a way she could, in fact, understand and learn from. So I think we’re on the right track…we just have to keep going.

MTP:  And none of them think that Spotify would just lie, right?  Like that royalty rate that Spotify released.  It’s frequently cited as “Spotify says” not “Spotify says and I asked these four artists who all said it was bullshit.”

Morgan: That’s true. But I also think that the idea that artists are business savvy and smart is (sadly) still a new one. That we would question the information coming out of a giant corporation about their rates––and be right––is a new concept. But I think that’s changing now too.
MTP: No thanks to Bob Lefsetz, by the way.  How has the reaction been to your interview in the #irespectmusic community?.
Morgan:  It has been just like it’s been throughout this entire year. People are celebrating. They’re energized. Motivated. Appreciative of everyone and anyone who is stepping forward. They’re standing together, respectfully and joyously, to fight and win for music and the people who make it. Onward!
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