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How YouTube “Monetizes” Your Songs to Sell Illegal Goods

April 17, 2013 Comments off

Monetize, monetize, monetize.  This is the constant mantra from YouTube to all copyright owners but especially to songwriters.  YouTube gives all kinds of assurances about how they can block songs, recordings and movies with their superduper “ContentID” and “Content Management System.”  While these proprietary Google technologies get all kinds of props in the no-nothing press, anyone who uses these systems routinely knows that it requires a staff at each content owner in order to manage all the glitches and mistakes in ContentID and CMS–in order for either of these systems to function properly.

Why?  Because at the end of the day, running a large content database that involves registering content requires human intervention.  Costly human intervention.  One customer service call can destroy profits.  And YouTube has essentially outsourced this expensive part of their business to copyright owners.  If you work at a major publisher, you know exactly what I mean.  If you are an independent songwriter you probably don’t because you have resigned yourself to YouTube’s screw ups.

And this from a company that won’t let you audit?

Case in point–here’s a video from what appears to be an illegal pharmacy site that was uploaded to YouTube before the Google drugs case (see the 2011 nonprosecution agreement between Google and the Criminal Division of the US Department of Justice by which Google avoided being indicted for violations of the Controlled Substances Act by paying a $500,000,000 fine and promising good behavior).

Note three things:  The video is “user generated content” (“user” in this context means a YouTube user not a drug user.  We think.)

Second, the video has a music bed.  Ironically, it is “Teardrop” by Massive Attack which is also the theme from the House television show.  I seriously doubt that Massive Attack has any idea that their song is being used to sell drugs through this sketchy video.

We know that YouTube knows the song in the video because they have a link to it by name on Google Play.

Finally, the video is monetized–ads are playing on the page, pre-roll before the video, and inside the video–in fact, the same ads are in each, so the campaign is coordinated.

YouTube Drugs Montana

This ad is for Southwest Montana–the State of Montana is buying ads to promote a drugs site and Google.  These ads are served by Google–note the credit “Ads by Google”.

YouTube Drugs Eakin

And then there’s this ad for Eakin Kia in Killeen, Texas.  I doubt seriously whether Mr. Eakin has any idea that he’s promoting the sale of drugs on YouTube.

Not to be outdone, Google itself advertises its Google Chrome product, probably due to the keyword “tablet”.

Chrome Drugs

Why is it that Massive Attack, the House television program and Eakin Kia are in this situation?

Because YouTube doesn’t give them the choice to block individual video uses.  And this video has been in place for 3 years.

Because YouTube wants to make the money–even when it involves practices that nearly put the company’s top executives in jail, was the subject of a lengthy grand jury investigation and for which Google shareholders paid $500,000,000.

They can pay $500,000,000 in punishment to the government, but they can’t quite manage to find a way to tell advertisers or songwriters that their songs or ads are being used to push drugs to YouTube’s young audience.

See also “What are you authorizing when you allow YouTube to monetize your songs?

Digital Music News: British ISPs Orderd to Block File Sharing Websites (including H33T, advertising partner of @united)

March 5, 2013 Comments off

Helienne Lindvall’s column in Digital Music News tells us that:

Late last week BSkyB, BT, Virgin Media and three other UK broadband providers were ordered by the high court to block access to the music and movie file-sharing websites Kickass Torrents (KAT), H33T and Fenopy. As the ISPs named in the court order account for about 94 percent of the market, this means these sites will be unavailable to the vast majority of the British population.

Of course, MTP readers will remember Willard’s little friends at H33T:

u2unitedh33t-21

I guess United Airlines will have to find someplace else to advertise.  Do you think this court order might convince them that H33T are bad guys?

The Fallacy of “Incremental Revenue” Part 1

March 3, 2013 1 comment

Dante’s 9 Circles of Hell by the gifted folks at Cinco Design cincodesign.com/blog2010/wp-content/uploads/2010/04/9levels_rgb.jpg

When you have a hit record, everyone is your friend.  And they all have figured out how to use your hit record in a new and innovative way.  No matter how revolting the innovation, no matter how philistine the approach, the commoditizers (aka “special markets”) press ahead.

And when it comes to compensation, no matter how little money you make from the obscene commerciality of the commoditized use, you know that the reason they are asking is because they are making more money than your artist or you one way or another—free riding on someone else’s hit record while doing little to contribute to its success.  Either they are building a catalog that they will sell one day (and in which you will not participate like YouTube’s $1.65 billion sale price), they are getting a fee or other benefit that your artist does not participate in, or something.

Two examples:  Tampon premiums and YouTube. 

Back in the days of the “international hit record”, there was a record called “Everything I Do, I Do it For You.”  Let’s take an anecdote from the life of that record because the anecdote really happened and those huge records don’t come along every day, Lil Poopy notwithstanding.  (Plus it’s far enough in the past that it’s easier to keep the example from revealing too much.)

In those days, I had to deal with incoming “special markets” requests from other labels (and eventually from our own distributor which was really maddening).  I had all the incoming special markets requests put in a special file.  That made it easier to burn them later.  My strategy with special markets was to negotiate by attrition—meaning that if you just ignored the request, the important ones would result in a phone call.  Why?  Because we were busy signing artists, making records, and selling those records to fans.  This is the “real” revenue and “incremental” revenue from the typical sources will always cannibalize front line sales and bring home pennies on the dollar the “incremental” income incrementally destroys.

That special markets phone call almost always started out with this kind of argument directed at me:

[Laughing/yelling/Vomiting] is not a response to a request for a [horrendously offensive] license request because while you may not like the request, your job is to make money for the artist [and the special markets division] and however much you [laugh/yell/vomit] over the license request it results in [BIG FINISH] INCREMENTAL REVENUE for you.  It is money you would not have had but for the genius of the innovative use proposed.

Right.

For example, during the middle of the 8 week or so period that “Everything I Do” was #1 on the worldwide radio charts, I got a request to let a special markets department manufacture a cheap cassette (which they would make money on manufacturing) that would be put in millions of boxes of tampons like a charm in a box of Cracker Jack.

And sure enough, I got a call from the oily cretin at the special markets department  complaining—complaining—that I did not understand my job.  But he did, you see.  My job, you see, was to create incremental revenue for the company (and, of course, for him).  To which I replied that he misunderstood my job.

My job was to sell lots of records by happy artists.  My job was to keep people like him from whoring our artists.  And the reason I didn’t give a damn about the supposed “incremental revenue” is because there never would be enough money to pay our artist—who we had spent millions in promoting and cultivating over years and years—to do something truly vile.

So we said pass, and the use wasn’t made.

Remember that—we passed and the use was not made.  This is how an orderly market works.  God help us all if special markets departments ever qualify for the DMCA safe harbor.

If you are an artist, what should be apparent to you from this exchange is that there are people–rarely the people who sign you–who sit around and dream up ways to whore you out.  I can tell you that the worst of these people frequently come labels that have a poor front line A&R strategy—the reason they want our hits is because they have few to none of their own.

Where are these people?  The 10th circle of Hell.  But wait, you say–there were only 9 circles of Hell in the Inferno.  Right, but so they’d have somewhere to go after commoditizing Circle 9, Dante would have to create a 10th Circle of Hell for these people where they could walk around in circles chanting “incremental revenue”—sponsored by Brylcream.

Enter YouTube

To be continued….

Shocker: Ad Networks Profit from Piracy

March 1, 2013 2 comments

Now here’s an interesting article in AdExchanger, a site apparently targeting the ad network trade.  (Lest we be accused of speaking of that which we do not have direct knowledge, it’s perhaps best to seek confirmation from a knowledgeable source.)  It is quite remarkable in the blitheness with which it acknowledges that big brands are funding pirates (or what used to be called “rogue sites,” if you remember that one).  To wit:

A big factor in play is that these categories [that is, the piracy categories] toward lead gen[eration] and other performance driven metrics. In other words, they’re inherently less focused on adjacency issues.

Ah, “adjacency issues.”  Of course.  Sounds so insignificant, doesn’t it?  What exactly would constitute focusing on “adjacency issues”?

“I would guess that the CMOs of many companies do not actually understand that they are appearing on some of these sites to the extent that they are and do not understand the amount of dollars they are putting in the pockets of these guys,” Will Luttrell, CTO and co-founder of advertising data provider Integral, told AdExchanger. Integral, formerly known as AdSafe, releases semi-annual reports analyzing the online advertising environment, including high-risk inventory.

I see, massive world wide piracy is just some guys selling “high risk inventory”.  High risk of what, exactly?  Getting caught, maybe?

“It’s difficult to advertise online at scale and not wind up on pirated content, at some point, as you’re buying through various exchange and remnant inventory sources,” Luttrell said. “It’s bad for the entire industry to shame companies who are not knowingly trying to advertise on these sites, but may just be caught up in this.

So because it’s difficult to know you’re paying Vladimir and Constantine to pirate software, music and movies instead of…oh, say, selling land mines to terrorists…then there’s nothing defective about the ad exchanges or anything.  No, no, it’s bad for the industry because the brands are just “not knowingly” advertising.  It’s not like they cared enough to find out they were helping launder money…I mean “caught up” in…”this.”  Whatever “this” is.  These guys seem to know exactly what the “this” is they are “caught up in”, however.

Luttrell also agreed with self-regulation, saying, “Washington is not very good at regulating Silicon Valley. Self-regulation can work. It’s a much slower process [slower than Congress not passing legislation they have no intention of enforcing?] and the key is to cut off funding [what is slow about that?] and that means figuring out ways to stop the advertising from appearing on these sites.” He highlighted how, in the past, ad networks and advertisers worked to keep their ads off of pornography sites, and noted that the same thing can be done on the piracy side.  [Especially now that Professor Taplin is naming the offenders maybe just maybe?]

The smug callous obliviousness to the harm these people are causing is really rather breathtaking.  But wait for it…

For the ad networks and exchanges, he added, it can be a painful process because ads on the piracy sites do drive revenue for these companies as well. “But ultimately, if an advertiser is telling the networks, ‘you will lose our business if we find out you are placing our ads on these sites,’ then they will comply,” Luttrell said. “It’s really about awareness and getting the CMOs involved in making this an issue.”

A “painful process”?  You mean, like watching your life’s work be stolen every minute of every day?  Painful like that?  And if the networks will comply if the brands tell them to stop, then would now be too soon for that call?  But note the qualifier: The usual Big Tech standard–“if we find out” meaning if we get caught.

“If we find out”?  Well, there’s the problem.

In order to “find out”, someone would have to look.

And let’s all remember–according to the Megavideo indictment, Kim Dotcom made his substantial millions in part from selling his advertising inventory through which ad networks?  Google Adsense and Adbright.  After the “Mega Conspiracy” lost another appeal today in New Zealand, that information got a little closer to being thoroughly litigated in a criminal case.  I wonder who’s paying his legal bills.

The Google Shill Listers will no doubt say nothing to see here, move along.  But if that were true, why would these ad network folk quoted in AdExchanger confirm the nature of the problem, the scope and the solution?

Sharing is Caring: What is Google’s Position on Data Sharing with Artists?

February 25, 2013 2 comments

While it remains to be seen exactly what the contours of a deal might be, Zoë Keating‘s advocacy of data sharing with artists by online music retailers is getting some traction.  Beats is making positive noises in that direction and I would expect others to follow shortly.  This is something of a privacy law challenge, but it could be something as simple as a “sign up here” button for the artist’s email list next to the “buy here” buttons to buy the artist’s downloads or CDs.

I’m willing to be educated otherwise, but it seems that an email opt in would be unlikely to present a greater privacy issue at all for the retailer.  This is because the fan would be in control of the opt-in decision, and any privacy rules applicable to the email list would live at the artist site and would (or should) already be in place regarding the existing artist email list.

However–this is a good moment to bring up a subject we have banged the drum about at MTP for years now:  Nondisplay uses of music.  Meaning uses that are made by a Big Data company like Google of information about music use, consumption, sales, distribution (or whatever) that are (1) not reported to the artist, (2) are covered in the cracks of the Big Data user privacy policy, and (3) that are sold, resold, and sliced and diced by the Big Data company like there is no tomorrow, now and forever amen.  And of course–none of the revenue derived from nondisplay uses goes to anyone other than the Big Data company–in this case, Google.

It is very, very unlikely that a Big Data company like Google is interested in a music platform just because they really want to be in the music business and make their cut of subscription, download or webcasting revenue.  No, the real cash cow for Big Data is Big Data.  That’s not a tautology–it was confirmed as recently as last week by the Financial Times (with the hysterically funny title, “Google Looks to Beat Music Rivals“):

Google is in talks with big music labels to launch a streaming service to compete with companies such as Spotify and Deezer, as it looks to expand into one of the fastest growing areas of the music market.

The discussions reflect the technology company’s ambition to extend its influence into new business areas and diversify away from advertising, which accounts for 95 per cent of its revenues.  [Good thinkin’, Dob….]

[But, wait, not so fast…there’s more….] Advertising executives also speculated that by scrutinising consumers’ listening habits, Google could build a valuable database for advertisers.

“It will be another piece of the puzzle for understanding consumers,” said Christophe Cauvy, European head of digital at advertising agency JWT. “This will be very interesting for brands where purchases are emotionally or status driven.”

So…think about that.  Where’s the real value going to lie…so to speak…for Google?  Making a tiny vig off of music, or collecting a bunch of information about fans that can be used in other Google products?  Hmmm?  As Ben Sisario identified it in the New York Times, which of the Two Googles are we talking to?  Aaron or Roy?

The Financial Times is even fuzzy on this issue as their article starts like they think that Google intends to get further into the music business because they want to make money off of streaming.  Given what we know about artist royalties from streaming, that seems highly unlikely.

What seems more likely is that Google Play gets consumers to put a Google entertainment center in their home and then Google monitors them all the live long day to serve advertising to the fans.  Maybe not while the fans are listening to a no-advertising subscription service, but when the fan leaves that environment and uses Google for something else.

Of course, Google will add this information from non-display uses to the data that it has already collected from serving ads to pirate sites offering the identical music, movies and books.

Do you think for one second that Google (or any other Big Data company) would share that information with the artists whose music gave it value?  Much less share it for free?

Hello, Roy.  I thought that was you.

14 Million Flies Can’t Be Wrong: The Chilling Significance of Google’s Two Sided Antipiracy Failures

February 22, 2013 Comments off

 

IAGO

By Janus, I think no…

Othello, Act 1, Scene 2, by William Shakespeare


Information Wants to be Monetized

In an excellent analysis, Ben Sisario of the New York Times almost puts his finger on Google’s problem with professional artists.  He identifies both sides of what would appear to be a kind of split personality at Google, but like Edward Norton’s riveting portrayal of the good “Aaron” and evil “Roy” in Primal Fear, these are actually two faces of the same really smart, but really sick puppy. AKA The New Boss or as we know them, The Man 2.0.

(Sisario’s article is an important read, see “For the Music Industry, A Story of Two Googles“)

Sisario observes:

In August, Google said it would take into account notices of copyright violation — of which the music industry files thousands each week — in determining a site’s search rank. The implication was that infringing sites would fall into obscurity and consumers would “find legitimate, quality sources of content more easily,” as Amit Singhal, a senior Google executive, wrote in a company blog post at the time.

We have been hearing about these “measures” that Google is taking for years now, and no matter when these utterances occur, they all have one thing in common:  Nobody seems to implement the measures, they are ineffective, Google keeps driving traffic to pirate sites and Google keeps profiting from piracy.  Oh, and more recently, Google has been shooting up the squid ink of Google Play and Rightsflow, Google Fiber and YouTube to give themselves the appearance of being team players.  They have even managed to pick off a few people from the music business to dress up this charade, but it doesn’t change anything.  But like Operation Bodyguard, these are largely grand deceptions.

Why would I say that these are deceptions?  YouTube itself is not a deception, clearly.  YouTube exists and is a triumph of infringement in the Age of Google.  YouTube itself isn’t the deception.  Like Norton’s character in Primal Fear, the deception is that there will ever be a time when Roy isn’t calling the shots.  When it comes to Google, Roy is not going anywhere.

14 Million Flies Can’t Be Wrong

The RIAA, which is one of the few organizations left in the music industry that can fund this kind of study, determined what we already knew would be the case–Google was full of it.  As Sisario puts it:

But the recording industry association, which is controlled by the major record companies, said that after testing Google’s searches, it still found plenty of infringing sites. “Six months later, we have found no evidence that Google’s policy has had a demonstrable impact on demoting sites with large amounts of piracy,” the report said.

At one point in the 15-page report, for example, the R.I.A.A. says that for many popular music searches, sites for which Google had received more than 1,000 copyright complaints were “almost eight times more likely to appear in the top 10 search results than a well-known, authorized music download site.” The report also shows, however, that sites for which Google has received more than 10,000 copyright removal requests appear less frequently than those which have received more than 1,000.

Is anyone surprised?  Clearly not at the Cato Institute, which offered its usual brand of bulletproof analysis:

sanchez

Let’s drill down on that erudite commentary, however, and think about the implications of the report in context.

As we noted here on MTP, Google has been desperately trying to keep Roy in check for some time now.  For example, Roy popped out when Google was nearly indicted for selling prescription drugs online in violation of a variety of drug laws.  Joseph A. Califano, Jr. (former Health and Human Services Secretary under President Carter) appealed to Google’s Eric Schmidt in 2008 to stop advertising illegal drugs that could (were and are) easily bought by children online.  When Aaron said, don’t be evil, Roy didn’t care.

When Google got the idea that the US Government was going after infringers in a big way, despite Google planting their own man Andrew McLaughlin in the White House, they came out with a major burst of ink vowing to be well behaved.  None of it happened, we saw the return of Grooveshark, and Roy still ruled the roost at the Googleplex.

Then came the Utoopi sex club app (Android only) that confirmed the worst suspicions of Congresswomen Carolyn Maloney and Marsha Blackburn voiced to Larry Page in the context of the Village Voice Media debacle over profiting from human trafficking ads.  Despite assurances from Google to Maloney and Blackburn, Roy still managed to get the Utoopi app in place to pimp out teens.

In a notable failure of Google’s “conservative outreach” at places like Cato, conservative blog RedState actually broke the story about the Utoopi app (“Google Profits from Sex Trafficking” by Breeanne Howe), followed closely by Firedoglake  (“Google Pulls Sex App Marketed to Students From Google Play” by Jane Hamsher).

Roy said “Waaaah.”

Can We Stop Pretending Google isn’t Intentionally Defective?

So the bottom line is this:  If a company makes a product that causes as much random harm as Google, at some point it stops being “disruptive” and starts being “mayhem”.  Perhaps willful mayhem.  This is particularly the case when a company keeps distributing a product it knows to be defective because it profits them to do so.

When Ford made the Pinto, did the law find that exploding gas tanks were “disruptive”?  Did society allow Ford to escape liability for any exploding gas take because Ford made a lot of them?

Let’s stop kidding each other, please.  Roy is running the tables at Google.  And here’s how you know–whether its profiting from piracy from ad sales or search, the Google response is always a nondenial denial because Roy doesn’t want to get caught.  It’s no fun if you get caught.  What’s fun is “catch me if you can”–you know, the DMCA.

In response to the report, a Google spokesman said in a statement: “We have invested heavily in copyright tools for content owners and process takedown notices faster than ever. In the last month we received more than 14 million copyright removal requests for Google Search, quickly removing more than 97 percent from search results.

In addition, Google’s growing partnerships and distribution deals with the content industry benefit both creators and users, and generate hundreds of millions of dollars for the industry each year.”

But Google can’t quite say they don’t do it–14 million flies can’t be wrong.  Like Norton’s character in Primal Fear, Aaron may make excuses for Roy’s bad behavior, but Roy comes in at the end and reminds creators not to jack with him or he’ll cut off the trickle of money that is increasingly keeping them alive.

And just wait until Google is driving traffic to 3d printing files ripping off the same products being advertised by the Fortune 500 companies that are Google Adsense clients buying advertising inventory from the very same pirate sites.  Very disruptive!

Don’t be evil, ya’ll.

Deep Thoughts from SF Music Tech

February 21, 2013 Comments off

The SF Music Tech conference ended this week, an excellent platform for Zoë Keating, more later about her ideas for online music services sharing fan data with the artists they exploit.  It was refreshing to see SF Music Tech continuing the theme started last year by David Lowery.  The usual old school “Deep Thoughts” kumbaya of the Barlow crowd is gradually being balanced out by real Bay Area artsts like Zoë Keating and East Bay Ray with real ideas about real issues.

Because if there is one thing that Big Tech’s brushes with the legal system tells us it’s that information wants to be anything but free.

The crotchety old school members of the Google Shill List are still partying like it’s 1999, however–and this live tweet from the conference by The Trichordist says it all:

T quote SF Music Tech

Yes, that’s exactly right–the money is there, it’s just going to “different places”–like brand sponsored piracy, for example.

lyrics007 adele pepsi

Rut roh…

It’s too bad that David Lowery wasn’t on a panel with Zoë Keating and East Bay Ray, that would have been quite a conversation.

PS Attention Australian readers, Zoë is coming your way next week.  You MUST see this artist.

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