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The Time to Hesitate is Through: Amazon’s Thievery Requires Decisive Action

August 28, 2019 1 comment

Emmanuel Legrand reports in his excellent newsletter that:

Music industry trade group the Recording Industry Association of America(RIAA) has asked the US government for tougher measures against infringers, in particular in the online marketplace. The proposal was part of a submission to the US Department of Commerce, as part of its request for comments on the state of the state of counterfeit and pirated goods.

You can read the RIAA’s submission here.  Note that everyone who participates in a recording is screwed by counterfeits including artists, producers, songwriters, musicians and vocalists.

Counterfeiting and pirating of physical music products facilitated by online platforms continues to cause harm to our members. In 2019, we conducted two studies to identify the amount of counterfeit offerings of music CDs on popular online platforms, including a study on the prevalence of high quality counterfeit box sets on certain platforms and a study on the prevalence of high quality counterfeits for a broad sample of current and evergreen album titles released by the major U.S. record labels. As further discussed below, each of these studies showed significant counterfeit activity on the noted online platforms, including findings that:

  • A recent sample purchase program found 100% of new high quality box sets offered for sale through eBay or AliExpress in the U.S. were counterfeit; and
  • A recent sample purchase program found 11% of new CDs offered for sale on Amazon were counterfeit, and 16% of new CDs sold on eBay were counterfeit.For the study on box sets of music, we identified and made test buys on eBay and AliExpress’s U.S. platforms of 10 well known artist box set titles released by major U.S record labels. Each purchase was made after a search for “brand new” box sets of the titles selected, and a purchase of the 4 lowest priced box sets on each platform, without regard to seller location. We then examined the products that were shipped to us. On both eBay and AliExpress, 100% of the test buys of the box sets were counterfeit. This is of particular concern as box sets are premium physical music products designed for the superfan that often contain the most significant sound recordings in an artist’s repertoire.

The conclusion is:

Trafficking of counterfeit and pirated goods, whether in the form of physical CDs, box sets or artist merchandise, as well as online infringement of music and music videos in digital form, continues to significantly impact the music industry. We believe more can be done, including implementation of voluntary measures as well as governmental action, to deter and reduce such activity, and create a healthier online ecosystem where all can thrive.

Amazon apparently was the only one of the bootleggers who responded, and did so with the usual non answer and deflection:

Our customers expect that when they make a purchase through Amazon’s store—either directly from Amazon or from one of its millions of third-party sellers—they will receive authentic products. Amazon strictly prohibits the sale of counterfeit products and we invest heavily in both funds and company energy to ensure our policy is followed. We work with and empower brands through programs like Brand Registry, Transparency, and Project Zero to ensure only authentic products are sold in our stores. We investigate any claim of counterfeit thoroughly,including removing the item, permanently removing the bad actor, pursuing legal action or working with law enforcement as appropriate.

Sound familiar?  Kind of like how YouTube responds to the community flagging?  Investigating after the illegal goods are being sold is not the point.  Getting caught is not the point.  The point is stopping the illegal goods from getting onto the platform in the first place.

The reason this drivel from Amazon sounds like tired crap is because it is tired crap.  And crystalizes that they think the problem is getting caught and that what they really want is to keep getting away with it.

And this is where I disagree a bit with RIAA–the time for voluntary measures has passed.  Someone needs to go to jail–someone high up who almost invariably knew what was going on (for example, grand jury documents told the U.S. Attorney for Rhode Island “Larry Page knew what was going on“).

Then we can talk again about voluntary measures to keep their butts out of the slammer–not their pathetic little “Project Zero.”  I got your project zero right here.

Remember the great continuum that has driven homo sapiens for millennia:

FEAR <———> GREED

We need Jeff Bezos closer to the FEAR end than the GREED end.

Remember that data is the new exposure, streaming is the new physical and that both these tropes have something in common–artists are being driven to substitute away from low to no margin streaming and away from sustainable margins on physical like CDs with no revenue replacement.  (Unless you’re in the 5% of tracks that account for 90% of streaming revenue in the hyper efficient market share distribution of streaming revenue.)

Against that background, we find that the online platforms like eBay, Alibaba and Amazon are going even further toward evil and doing little or nothing in their rush to drive physical retail out of business to stop the sale of counterfeit CDs delivered to your door by Amazon Prime or Ali-express.  And most honest business folk would probably think they are pretty shameless about it and ask how could they get away with sucking up the revenue from counterfeits into their maelstrom of cash?

But before you go down that rabbit hole, you need to understand an important fact about the mind set of Silicon Valley–and it’s the same mindset that gave us both Google and Theranos.  It’s not that they made a choice to do evil.  It’s that they don’t understand there is a choice about doing evil.  It’s how these little soulless people sit in front of Congress and lie and feel good about themselves.  The Internet is their Ring of Gyges and they are unconcerned about justice because their thing is getting away with it, not getting caught and getting richer than Croesus.

Somewhere in their development they lacked the normative guide–or “sherpa” in their case–that should have developed a self-governing code to map their behavior.  Parents, pastors, priests, rabbis, teachers, all failed to make a dent.  These are the kind of people who don’t stop when the European Commission fines them billions.  They don’t care how they treat their employees as long as they’re the richest man in the world.  They don’t care about ripping off artists.  Their reaction to getting caught is not fixing the problem, their reaction is to buy the shillery and try to make us look greedy for expecting them to behave.

If a $5 billion fine didn’t work, how about $50 billion?  Let’s try that.  But even in the Silicon Valley dual class stock system, the corporate royalty might start thinking about offering up an executive to save the company rather than pay truly appropriate fines.

This is why the solution probably isn’t voluntary.  It probably has a lot more zeros on it than any normal person  would think reasonable, or is a court order for very specific behavior, or simply prison.

You Furnish Alexa, and He’ll Furnish the War

February 10, 2019 Comments off

When Hearst Artist Frederic Remington, cabled from Cuba in 1897 that “there will be no war,” William Randolph Hearst cabled back: “You furnish the pictures and I’ll furnish the war.”

Time Magazine

Many artists I speak to have a serious moral problem driving their fans to YouTube knowing that the artists are simply feeding Google’s data bombing with collateral damage in the form of their music and their fans.  Yet Google’s beachhead in the data apocalypse is nothing compared to Amazon–as far as I know, which I hesitate to say too categorically given that it’s Google.

But Amazon’s super groovy Alexa comes with many Intelligence Community connections that on balance are more destructive to society than the carbon footprint of Amazon trucks creating the inverse of the efficiency of the shopping center, brutalizing employees or destroying small retailers.

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What does Amazon do with your fan’s Alexa data (or your data for that matter)?  Belle Lin reports in the Intercept:

At the beginning of October [2018], Amazon was quietly issued a patent that would allow its virtual assistant Alexa to decipher a user’s physical characteristics and emotional state based on their voice. Characteristics, or “voice features,” like language accent, ethnic origin, emotion, gender, age, and background noise would be immediately extracted and tagged to the user’s data file to help deliver more targeted advertising.

The algorithm would also consider a customer’s physical location — based on their IP address, primary shipping address, and browser settings — to help determine their accent. Should Amazon’s patent become a reality, or if accent detection is already possible, it would introduce questions of surveillance and privacy violations, as well as possible discriminatory advertising, experts said.

The civil rights issues raised by the patent are similar to those around facial recognition, another technology Amazon has used as an anchor of its artificial intelligence strategy, and one that it controversially marketed to law enforcement. Like facial recognition, voice analysis underlines how existing laws and privacy safeguards simply aren’t capable of protecting users from new categories of data collection — or government spying, for that matter. Unlike facial recognition, voice analysis relies not on cameras in public spaces, but microphones inside smart speakers in our homes. [Emphasis mine]

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What’s the connection to the Intelligence Community?  It’s all in the cloud, baby–according to Frank Konkel writing in The Atlantic:

The intelligence community is about to get the equivalent of an adrenaline shot to the chest. This summer, a $600 million computing cloud developed by Amazon Web Services for the Central Intelligence Agency over the past year will begin servicing all 17 agencies that make up the intelligence community.

And of course the next step after the old IC is the largest employer in Crystal City.  According to many sources, Amazon is competing to win a $10 billion–that’s with a  B–contract from the Department of Defense to provide cloud services to the entire U.S. military, called the Joint Enterprise Defense Initiative or “JEDI”.  (Oh, please.)  The Pentagon, by the way, is essentially next door to Amazon’s HQ2 site in Crystal City/Alexandria.  There are many interesting twists to this particular Amazon grab at the taxpayer’s money, but one story that caught my eye is Reuters’ reporting that Google dropped out of the competition–why you may ask?

Alphabet Inc’s Google said on Monday it was no longer vying for a $10 billion cloud computing contract with the U.S. Defense Department, in part because the company’s new ethical guidelines do not align with the project, without elaborating.

Google said in a statement “we couldn’t be assured that [the JEDI deal] would align with our AI Principles and second, we determined that there were portions of the contract that were out of scope with our current government certifications.”

Yes, that’s right.  Too corrupt even for Google.  (And CNN reports that Amazon is being investigated by the Pentagon for illegal government contracting practices.)  That’s right–Jeff Bezos, JEDI master, wants those big bucks from John Q. Public.

Amazon is looking more and more like Halliburton, and Jeff Bezos is looking more and more like the Charles Foster Kane of the data apocalypse.  YouTube looks tame by comparison, which tells you how bad it really is.

And then there’s this braying about Amazon’s “Rekognition” AI-driven facial recognition application:

Amazon Rekognition today announces three new features: detection and recognition of text in images, real-time face recognition across tens of millions of faces, and detection of up to 100 faces in challenging crowded photos. Customers who are already using Amazon Rekognition for face verification and identification will experience up to a 10% accuracy improvement in most cases.

And who among us will find it useful to use this tool for “detection of up to 100 faces in challenging crowded photos”.  Well…depends on who you mean by “us” as Ava Kofman reports in The Intercept:

Police in Lancashire, a county in northwest England, have rolled out a program to broadcast crime updates, photos of wanted and missing people, and safety notifications to Amazon Echo owners. Since February, the free app has been available to those using Alexa, a cloud-based voice assistant hooked up to the Echo smart speaker. The first of its kind in the U.K., the program was developed by the police force’s innovations manager in a partnership with Amazon developers.

The program marks the latest example of third parties aiding, automating, and in some cases, replacing, the functions of law enforcement agencies — and raises privacy questions about Amazon’s role as an intermediary. Lancashire County will store citizens’ crime reports on Amazon’s servers, rather than those operated by the police.

And once Amazon uses Alexa to collect this biometric and other data, who do you think has access to it, hmmm?  And then there’s Ring, but what happens when Ring meets Alexa is a story for another day, or perhaps an Amazon Prime original series.

So are you still sure you want to promote Alexa penetration?  Just ask “her”–“Alexa, deliver my file” and see what happens.

 

 

Guest Post: How Amazon’s Twitch.tv Cheats Music Creators

August 1, 2018 1 comment

Guest post* by Erin M. Jacobson, Esq.

[This article was first posted on Forbes.com and previously on themusicindustrylawyer.com.]

Music creators (songwriters and performing artists) and rights’ owners (music publishers and record labels) are not collecting a new and substantial source of income – and most of them are not aware they are not collecting it. Enter Twitch, the website exploiting creators and owners without paying for a single cent of music usage.

What is Twitch

Twitch, a subsidiary of Amazon, is a live-streaming video platform that has “over two million broadcasters and 15 million daily active users.” Anyone can become a Twitch “broadcaster,” meaning users set up their own channels and live-stream various content, which includes, but is not limited to, video-game play, card games, pranks, craft tutorials and more.

The broadcasts start out as live streams and are saved on the channel for re-broadcasts and on-demand watching. Watching videos and channels on Twitch is free and publicly accessible to anyone with an Internet connection. Anyone can become a Twitch broadcaster for free and earn money directly from viewers. Broadcasters that contract with Twitch to become a partner or affiliate will earn money from Twitch directly, as well as from viewers. All revenue streams are described in the next two sections.

Income Earned by Twitch and Twitch Partners/Affiliates

  1. Ad Revenue: Twitch serves ads on all video content, which includes video-on-demand and pre-rolls, and collects ad revenue from showing these ads.
  2. Subscriptions: Viewers can subscribe to a particular broadcaster’s channel at pricing tiers of $4.99, $9.99, and $24.99, with these charges recurring monthly. These subscriptions allow viewers to support broadcasters and use special emotes (chat icons like emojis) that are accessible only to subscribers of a particular broadcaster’s channel.
  3. Bits: Viewers can contribute “bits” to a broadcaster during a stream. Bits are a digital currency within Twitch bought by users for real money, and contributing these bits to a broadcaster is basically like adding money to that broadcaster’s tip jar.
  4. Amazon Prime: Because Twitch is owned by Amazon, Prime members can use “tokens” from their Prime membership to subscribe to broadcaster channels on Twitch. Tokens renew every month, so a Prime member can re-subscribe to a broadcaster’s channel on a monthly basis using Prime tokens.

Twitch and the broadcaster split all income from subscriptions, bits, and Prime tokens, usually on at least a 50/50 basis.

Income Earned Directly by Broadcasters

  1. Donations: Viewers can contribute money directly to a broadcaster through third party services like StreamLabs, Muxy or StreamElements without buying bits.
  2. Media Share: Viewers can make “media share requests” through StreamLabs  and StreamElements, meaning viewers can request a broadcaster to play a certain song, YouTube video, or other media within a live stream (hereinafter “Media Share(s)”). Prices for Media Shares are set by the broadcaster, and some broadcasters will start their pricing at $5 per request.

A Twitch Broadcaster’s Earnings

Twitch’s most popular broadcaster is 26-year old Tyler Blevins, known on Twitch as “Ninja.” Ninja reportedly earns over $500,000 per month on Twitch revenue alone, not counting his recent sponsorship deals by Red Bull and Uber. A recent Forbes article reported Ninja’s earnings calculation: “160,000 subscribers at a higher $3.50 rate per sub means he’s pulling in $560,000 a month from that revenue stream alone. Not counting Twitch bits. Not counting donations. Not counting 4 million YouTube subscribers.”

Ninja and most other broadcasters also use music in their streams. None of this music is licensed and none of this money is going to the music creators or rights’ owners.

Music Licenses Required

Platforms with user-generated audiovisual content require performance licenses for the compositions from performance rights organizations ASCAP, BMI, SESAC and GMR. Music users must obtain synchronization and master use licenses from the music publishers and record labels, respectively, along with paying negotiated fees to “synchronize” the audio with the visual elements. Also, rights’ owners may share in ad revenue in addition to or in lieu of those fees.

It should also be considered whether a broadcaster who repeatedly uses a particular song as a theme song or channel staple (like when Ninja does a victory dance at every game win to the song, “Pon Pon Pon”, performed by Kyary Pamyu Pamyu) is implying an association with or (false) endorsement by an artist, similar to when political candidates use certain songs in their campaigns.

First, there is no evidence that Twitch has valid performance licenses in place from ASCAP, BMI, SESAC, or GMR (although they may be working on it). Therefore, Twitch is not paying for the repeated performances of music to audiences of millions.

Second, it is not known that any broadcaster using music on Twitch obtains synchronization or master use licenses, or pays any fees for the use of music. Also, neither Twitch nor the broadcasters are sharing ad revenue with rights’ owners.

Third, Twitch does not have its own content ID system like YouTube to track and claim uses of music. Twitch leverages Audible Magic to track audio uses after a live stream is over and will mute infringing content in the on-demand re-broadcasts, but not all content is recognized and removed. Also, there is no system to flag these infringing uses or mute them during a live stream.

All of the money earned by Twitch and its partner/affiliate broadcasters for subscriptions, bits, and Prime membership is retained entirely by Twitch and its partners/affiliates, and money earned from donations and Media Share song requests is kept entirely by the broadcasters. None of these funds are allocated to music creators and rights’ owners whose music is being used in these broadcasts.

Current State of Affairs

On June 22, 2018, the Twitch community received a shock when a group of its most popular broadcasters were banned from Twitch for playing a leaked version of a new song by rapper Juice Wrld that was initiated via Media Share song requests. Interscope Records issued DMCA takedown notices, and per Twitch policy, each infringer was banned for 24-hours.

This incident has shed a light on the use of uncleared music by Twitch broadcasters, but many have either continued with playing uncleared content or will not include certain music in the broadcasts. Ninja has turned off music content so he can then repost videos to YouTube in order to avoid YouTube claims by rights’ owners and keep his YouTube ad revenue. Ninja has publicly stated, “I’ve already reached out about getting rights to music … you can still get screwed over for playing music that doesn’t belong to you. … It’s such a nightmare, that it’s just not worth it.”

Interscope later supposedly stated the DMCA takedowns were an accident and Juice Wrld apologized to the Twitch broadcasters, saying “I will do what I can to prevent it from happening again.”

The National Music Publisher’s Association (NMPA) is rumored to be in negotiations with Twitch for licensing, but has not confirmed or commented as to the details.

Furthermore, Twitch isn’t the only site on the market. There are other, similar sites such as Mixer (owned by Microsoft), Facebook Gaming, YouTube Gaming, and Caffeine. There are also other music-centric sites, like Smule, using music in audiovisual content purportedly without permission or payment. More of these websites, as well as phone apps, with user-generated content, continue to emerge and the rate at which more new platforms are introduced is unlikely to slow due to the prevalence of streaming.

The Real Problems

First, rights’ owners are not enforcing their rights and making sure they receive payment for uses of their content. As stated at the beginning of this article, many creators and rights’ owners do not even know about these infringements. Those rights owners’ that are aware, like Interscope, have allowed the rumors of “accidental” takedowns to be the last word on the subject instead of taking a stand to protect their rights.

Second, Juice Wrld is an example of at least one artist condoning the Twitch broadcasters’ unauthorized use of his work instead of getting paid. Artists and songwriters can and should benefit from these uses, and condoning the infringing behavior allows for more of it, as well as a further loss of income to the creators and rights’ owners.

Third, streamers are often ignorant of how to obtain permission. Noah Downs, a video game lawyer at McDonald, Sutton & DuVal in Richmond, VA observes, “Some broadcasters reach out to artists directly, thinking that if the artist tweets ‘Sure, use my music!’ then it must be okay to use. It does not matter if a broadcaster has that kind of permission from the artist – generally the decision is up to the label.”

Fourth, many streamers feel entitled to play music without permission under the belief they are actually helping artists by giving them exposure. Famous artists and songs do not need free promotion from Twitch broadcasters – they are already famous. While exposure might be helpful for new artists to gain fans, it still doesn’t need to be for free. For example, music service Pretzel Rocks and music company Monstercat have agreements with artists allowing music to be played legally on Twitch broadcasts with compensation being paid to the artists and songwriters.

In an ironic twist, Twitch viewers and broadcasters frequently use and repurpose clips of other Twitch broadcasters’ content without permission. The broadcasters complain about this practice and will submit content claims when their content is used without permission, but they fail to realize that they are doing the same thing to music creators and rights’ owners. Downs agrees, stating, “In many ways, broadcasters and musical artists are the same, and both deserve to be paid fairly.”

The bottom line is that all creators and rights’ owners need to be properly compensated for uses of their work. Rather than ignoring or condoning infringing behavior, creators and rights’ owners need to keep up with new uses of music and take a stand to protect the value of their music and their livelihoods.

It’s time creators stopped feeling entitled to steal from and deprive each other of the fruits of their labor. It’s time people realized that using music without permission or payment not only cheats the creator or performer, but also impacts everyone that works for them or with them. It’s time the culture of all creators shifts to one of respecting one’s own work enough to get paid for it and respecting the work of others enough to get the proper permissions and pay the proper compensation. It’s time that everyone gets serious about valuing music.

*This article does not constitute legal advice.

Erin M. Jacobson is a practicing attorney, experienced deal negotiator, and a seasoned advisor of intellectual property rights who protects musicians, songwriters, music publishers, and other music professionals.   Ms. Jacobson’s clients include Grammy and Emmy Award winners, legacy artists, and independent artists and companies. She handles all types of music industry agreements, with an emphasis on music publishing.

Ms. Jacobson also frequently represents legacy clients and catalogues, as her knowledge of both classic music and current industry practices places her in a unique position to protect and maximize opportunities for older catalogues.  She is a frequent author and speaker, and has been featured in Forbes and Music Connection.  Ms. Jacobson has also been named a Super Lawyers Rising Star and one of the Top Women Attorneys in Southern California.

For more information, visit www.themusicindustrylawyer.com.

 

@vahn16: Popular Twitch Streamers Temporarily Banned For Playing Copyrighted Music — Artist Rights Watch

July 13, 2018 Comments off

[Editor Charlie sez: It’s about time that these royalty deadbeats began understanding the meaning of “repeat infringer policy” which Twitch (owned by Amazon) does not seem to have in place at all.]

If you’ve watched any Twitch streams at all in your life ever, this might come as a surprise to you. After all, pretty much everybody on Twitch uses music. Sometimes it’s royalty-free, but it’s not uncommon to hear familiar hits during big streamers’ shows. Some streamers have playlists going in the background for the entirety of multi-hour streams. Others—Kotaku’s own channel included—put on some chill music before a stream is about to start, to let viewers know it’s time to tune in. To account for this, sometimes Twitch auto-mutes audio in portions of stream archives. Otherwise, people don’t usually get in trouble for it.

That doesn’t mean they can’t get in trouble for it, though.

via @vahn16: Popular Twitch Streamers Temporarily Banned For Playing Copyrighted Music — Artist Rights Watch

Big Tech’s Latest Artist Relations Debacle: Mass Filings of NOIs to Avoid Paying Statutory Royalties (Part 1) — Music Tech Solutions

September 29, 2016 Comments off

Google, Amazon and MRI are reportedly filing “millions” of NOIs with the Copyright Office after buying data out the back door of the Library of Congress–all to avoid paying statutory royalties.  This takes “carpet bombing NOIs” to a whole new level of hurt for songwriters, and forces the Copyright Office to be complicit in the wholesale rip off.

via Big Tech’s Latest Artist Relations Debacle: Mass Filings of NOIs to Avoid Paying Statutory Royalties (Part 1) — Music Tech Solutions

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