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Google’s European Campaign Contributions on Article 13

August 24, 2018 Comments off

RITTER

They want what every first term administration wants…a second term.

From A Clear and Present Danger, written by Tom Clancy (novel), screenplay by Donald Stewart, Steven Saillian and John Milius.

MTP readers will recall that both the Times of London and Frankfurter Allgemeine Zeitung have confirmed the efforts by Google to influence the vote on copyright reform in the European Union.  We called for that investigation on MTP and were mocked for doing so by the usual suspects.

Getting mocked by the usual suspects is how you know you’re onto something big, by the way.

But we owe a big thanks to the really stellar investigative work of Volker Rieck and David Lowery that exposed how Google uses astroturf front groups to “push its views” and for which it no doubt pays well.

Dj_qcYOW4AAfyRy.jpg-large

There is, of course, a political dimension to this exposé that has not been examined thoroughly yet.  It’s an important dimenstion because the Members of the European Parliament must stand for election next year, less than a year away.  And the Member of the European Parliament who certainly appears to be as close to Google as 1 is to 2 is the lone Pirate Party representative.

The Pirate Party is a creature of proportional representation, an interesting practice in Europe (and other places) that allows political parties with very small constitutencies to field candidates and sometimes get elected to legislative bodies such as the European Parliament.  The Pirate Party has one European Parliament representative elected from Germany, which is interesting because Google has also dropped a pile of influence-peddling cash in Germany according to the Google Transparency Project.

First, Google’s academic influence program in Europe has gone beyond funding existing academic institutions, as it does in the United States, to helping create entirely new institutes and think-tanks in key countries like Germany, France and the United Kingdom. In those countries, executives from Google’s lobbying operation have helped conceive research groups and covered most, or all, of their budgets for years after launch.

Google policy executives have acted as liaisons to steer their research priorities and host public events with policymakers.

For example, Google has paid at least €9 million to help set up the Alexander von Humboldt Institute for Internet and Society (HIIG) at Berlin’s Humboldt University. The new group launched in 2011, after German policymakers voiced growing concerns over Google’s accumulated power.

The Institute has so far published more than 240 scholarly papers on internet policy issues, many on issues of central importance to Google’s bottom line. HIIG also runs a Google-funded journal, with which several Google-funded scholars are affiliated, to publish such research.

The Institute’s reach extends beyond Germany, or even Europe. HIIG previously managed, and still participates, in a global Network of Internet and Society Research Centers [Silicon Valley’s answer to the Confucious Institutes] to coordinate internet policy scholarship. Many are in emerging markets where Google is trying to expand its footprint, such as India and Brazil.

So it must be said that when Google was caught with its hand in the cookie jar on Article 13, that astroturf effort must be viewed as part of a larger Google policy laundering operation that may include influencing elections.  Certainly in a post-Cambridge Analytica world, one cannot simply ignore these dots and all are worthy of investigation for compliance with Europe’s campaign finance laws if nothing else.

For a minority political party representative of one in need of a message in the face of an imminent election, it simply cannot be ignored that garnering the finanical support of Google and Facebook’s astroturf operation for a campaign that directly or indirectly benefits a candidate may be welcome.

Getting Silicon Valley’s billions focused on motiviating the electorate around a particular issue of benefit to such a multinational bloc of monopolists might help motivate voters and guide them to the “right” candidate.  As one of the usual suspects noted:

When the European Commission announced its plans to modernize EU copyright law two years ago, the public barely paid attention. This changed significantly in recent months.

Which was perhaps one of the electoral objects of the astroturf exercise.

Considering that political campaigns in Europe are typically of quite limited duration compared to the US (sometimes as short as 25 days before polling day), coming up with a an issue campaign that a political candidate–especially an incumbent–can leverage to increase their profile has got to be golden–particularly if that campaign may not rise to the level of a restricted political contribution or electioneering has got to be disclosed.

If that issue campaign can draw funding and support from U.S. based multinational corporations like Google and Facebook leveraging their user networks and advertising clout, all the better for a vulnerable candidate.

Because in the end, what every incumbent wants is another term.  The Pirate Party already faces declining relevance and may lose the one seat they have in the European Parliament elections in a few months time.  Especially if the the Pirate Party already struggles to field a winner.  Faced with such an existential threat, who knows what compromises may get made and who knows what in-kind donations may surface.

Undisclosed compromises and in-kind donations.

Hey Alexa, Regift Yourself: Google Overtakes Amazon in Biometric Data Acquisition Tools — Artist Rights Watch

August 20, 2018 Comments off

google2.png

According to the Canalys research outfit, Google has taken the lead over Amazon for the first time in the acquisition of biometric identifying data–aka “smart speakers”.  It should come as no surprise that Google is vastly more interested in acquiring “phonemes” by which to identify users and track them through a variety of means.

The “smart speaker” is the latest step in government contractor Google’s long running campaign to track users and build speech-to-text and speech recognition tools.

The program goes back to at least 2007 when Marissa Meyer said of “GOOG-411”:

The speech recognition experts that we have say: If you want us to build a really robust speech model, we need a lot of phonemes, which is a syllable as spoken by a particular voice with a particular intonation. So we need a lot of people talking, saying things so that we can ultimately train off of that.

So who do you think the customers are for speech-to-text and speech recognition tools to whom government contractors like Google and Amazon might be selling your biometric data?  The biometrics harvesting tools allows Big Tech to connect your voice print and maybe your fingerprints to all the other data that they have already harvested about you from other means.  And of course when you add in facial recognition or iris recognition it’s game, set and match.

Think about that when you enable your fingerprint, iris or facial recognition authentication or talk to Alexa or your Google Home Mini.   Or you could just ask the Shoe Gazer at the Internet Association.

“Hey Alexa, re-gift yourself.”

 

Facebook’s Campbell Brown Demonstrates the Ontological Smugness of the Ship Jumper

August 15, 2018 Comments off

Emporer zuck

We’ve all experienced the sneering smugness of the executives at YouTube, Vimeo, Facebook and Amazon looking down their noses at artists and labels (especially independents).  (Never a problem with Apple in my experience, by the way, gee I wonder why.)

But the ontological definition of smugness is often found in the smuggest of the smug–former executives from a business in one of the copyright categories who quisling their way into a job defending surveillance capitalism at one of the big social networks.  There is no better example than Campbell Brown.  Yes, that Campbell Brown, formerly of CNN.

Ms. Brown, you see, is now Facebook’s “global head of news partnerships” or something like that.  She’s the one that Facebook sends out to try to convince news organizations that Mark Zuckerberg isn’t out to destroy or at least censor them and their readers.

750px-zuck_xijinping

According to multiple reports, in The Australian, The Sun, The Guardian and others, Ms. Brown is quoted as telling a group of Australian news media executives (this from Olivia Solon in The Guardian):

“We will help you revitalise journalism … in a few years the reverse looks like I’ll be holding your hands with your dying business like in a hospice,” she said, in comments corroborated by five people who attended the meeting in Sydney on Tuesday.

Now ask yourself this–how many times have you heard this exact kind of thing coming from Big Tech executives?  I know I’ve been hearing it since at least 1999 if not before.  That stuff is really, really getting old.

But wait, there’s more of the same.

During the four-hour meeting, Brown also talked about the company’s decision to prioritise personal posts from family and friends over journalistic content within the news feed. The move has hit some publishers who rely heavily on referrals from Facebook hard.

“We are not interested in talking to you about your traffic and referrals anymore. That is the old world and there is no going back – Mark wouldn’t agree to this,” said Brown.

Of course, the real problem is that because of a variety of safe harbors, it is difficult for news organizations to cut off “journalistic content” from Facebook altogether which is exactly what they richly deserve.  If you’re going to the hospice anyway, wouldn’t you rather go to that big news conference in the sky on your feet than on your knees?

And here’s the height of smugness from Ms. Brown:

The Australian also reported that Brown said that Facebook’s chief executive, Mark Zuckerberg, “doesn’t care about publishers but is giving me a lot of leeway and concessions to make these changes”, although both Facebook and Brown vehemently deny this comment was made, referring to a transcript they have from the meeting.

Facebook would not release the transcript from the meeting.

Of course they wouldn’t.  They have all the data in the world that they sell to anyone with a pulse, but they’re not going to release that transcript.  Presumably this is on the advice of Facebook’s soon-to-be-departed general counsel, the eponymous Mr. Stretch, he of the Dickensian name.

The upshot of the story would appear to be self-aggrandizement by Campbell Brown–who many would have thought better of–that your business is dying unless you deal with me because Mr. Big is too big for you but has deputized me to throw you some scraps.

Even though Ms. Brown and Facebook deny the event ever happened that way, I have to say that it all rings very true to me.  I think it will ring true to anyone who has dealt with those who jump ship but then go sell themselves based on their past work experience to a buffoon like Zuckerberg (who kowtows like Bozo to authoritarian regimes, literally).  Amazing what a few stock options will do to elevate one’s opinion of oneself.

All that’s missing is for the journalist trades to hail Ms. Brown’s expertise and deal making ability simply because she was once a passenger on the ship she jumped from.  That would complete the ontological smugness of it all.

 

 

 

 

Factiness EU Style: A Dedicated Group of Like Minded People Carpet Bombs The European Parliament

July 17, 2018 Comments off

ALEX

Viddy well, little brother. Viddy well.

from A Clockwork Orange, written by Stanley Kubrick based on the novel by Anthony Burgess

As we noted in Fair Copyright Canada and 100,000 Voters Who Don’t Exist back in 2009, the legitimate desire by governments to use the Internet to engage with the governed is to be admired.  But there have been incredible and probably illegal uses of the Internet to overwhelm elected officials with faux communications that reek of Google-style misinformation and central planning in the hive mind of the Googleplex.

We saw this again with the Article 13 vote in Europe last week with what clearly seems to be a Google-backed attack on the European Parliament for the purpose of policy intimidation.  That’s right–an American-based multinational corporation is trying to intimidate the very same European government that is currently investigating them for anticompetitive behavior and is staring down a multi-billion dollar fine.

Vindictive much?

Advocacy against Google’s interests on artist rights and copyright issues (not to mention human trafficking, advertising illegal drugs and counterfeit goods) can no longer be just about making a good argument to policy makers.  It has to anticipate that Google will pull these DDOS-type stunts capitalizing on what seems to be the element of surprise.

Except there shouldn’t be any surprise.

There is a real problem with policy-by-DDOS governing.  For example, Cass Sunstein, then the Administrator of the Obama Office of Management and Budget, issued a memo in 2010 to the heads of executive branch departments and regulatory agencies which dealt with the use of social media and web-based interactive technologies.

Specifically, the Sunstein memo warned that “[b]ecause, in general, the results of online rankings, ratings, and tagging (e.g., number of votes or top rank) are not statistically generalizable, they should not be used as the basis for policy or planning.”  Sunstein called for exercising caution with public consultations:

To engage the public, Federal agencies are expanding their use of social media and web- based interactive technologies. For example, agencies are increasingly using web-based technologies, such as blogs, wikis, and social networks, as a means of “publishing” solicitations for public comment and for conducting virtual public meetings.

The European Parliament would do well to take a page from Sunstein’s thinking and limit the amount of anonymous contact that anyone can have with MEPs when the European Parliament is suffering a DDOS-style attack.

But the most important thing for the European Commission to take into account is that a company that is the target of multiple investigations is using the very market place monopoly that caused the competition investigations to intimidate the European government into bending to its will on Article 13.  (That, of course, is the biggest difference between the Europeans and Article 13 and the Americans and SOPA–the US government had dropped the US antitrust investigation into Google and it had unparalleled access to the White House.  So the two are really nothing alike at all.)

The European Commission needs to launch a full-blown criminal investigation into exactly what happened on Article 13, particularly since there is another vote on the same subject coming in September.  Properly authorized law enforcement acting swiftly can set sufficient digital snares to track the next attack which surely is coming while they forensically try to figure out what happened.

Advocates need to understand that Google is a deadly force and this is the endless war.  Good arguments are clearly not enough anymore, particularly as long as the government and law enforcement do nothing to protect democratic values from bully boy tactics.

Are Data Centers The New Cornhusker Kickback and the Facebook Fakeout?

July 9, 2018 Comments off

In case you were scratching your head about why Nebraska Senator Ben Sasse decided to stick his beak into trying to continue discrimination against recording artists who had the misfortune to record before 1972–here’s a possible explanation.  Maybe he was just getting his beak wet?

Remember, Senator Sasse introduced an amendment to the Music Modernization Act in the dead of night the day before the markup of MMA in the Senate Judiciary Committee.  While Senator Ron Wyden–another data center beneficiary of Amazon, Facebook and Google–was at least trying to dress up his complicity in a Chanel suit and Louboutin shoes.  Senator Sasse went the more direct route:

Sasse Amendement

Now why might he be so interested, particuarly given Nebraska’s musical history?  It turns out that there is quite the competition between Nebraska and Iowa for Silicon Valley’s data center business, particularly given the rewewable energy profile of each state (wind is 37% of Iowa’s electricity production and about 20% of Nebraska (including hydro).  That checks the box for Silicon Valley.

Of course, as we see from Senator Sasse’s tone deaf foray into copyright lobbying, Silicon Valley thinks they can play the rubes in return for building data centers in their state, just like they did with Senator Ron Wyden and the people of Oregon.  What does stiffing pre-72 artists have to do with data centers?  Nothing.  What does it have to do with playing footsie with royalty deadbeats like Google and Facebook?

Everything.

And rumor has it that there is a deal in the wings for a new Google data center in Nebraska.  Which also explains a lot.

But somehow, Facebook knows that its Silicon Valleyness may not be that popular with the rubes.

According to Data Center Dynamics, Facebook has been going to great lengths to hide its involvement in massive data centers being built in Nebraska, which gives “Cornhusker Kickback” a whole new meaning:

Operating under the alias Raven Northbrook, Facebook has its eyes on Nebraska, DCDcan exclusively reveal

Late last year, local council officials granted approval for a large data center project in Sarpy County, Nebraska, but the company behind the huge facility was kept a secret.

Now, DCD can confirm that the corporation hoping to build four 610,000 square foot (56,670 sq m) data center halls at the Sarpy Power Park is Facebook.

You can run servers, but you cannot hide them

SHOW FULLSCREEN

Raven Northbrook, certificate of authority, Facebook

Source: Nebraska Secretary of State

Sarpy County documents reveal that the company, which is publicly represented by infrastructure engineering and design solutions company Olsson Associates, goes by the name Raven Northbrook.

Read the post on Data Center Dynamics

@scleland: The Huge Hidden Public Costs (>$1.5T) of U.S. Internet Industrial Policy — Artist Rights Watch

April 16, 2018 Comments off

[Editor Charlie sez: Scott Cleland takes an excellent deep dive into the “leechonomics” of the safe harbors afforded to the special people who are members of the Internet Association and the Digital Media Association. This corporate welfare was most recently replicated in the punitive Music Modernization Act retroactive safe harbor bolstering profits from copyright infringement for the special people which passed the House Judiciary Committee on the same day that the Congress cut back the CDA 230 safe harbor for many of the same special companies and cut their profits from sex trafficking.]

via @scleland: The Huge Hidden Public Costs (>$1.5T) of U.S. Internet Industrial Policy — Artist Rights Watch

@TaylorSwift13 Thinks Outside the Stream to Bridge the Value Gap

November 25, 2017 Comments off

There are several myths about streaming, but none so prevalent as the “savior” trope, which streaming services are doing their best to splice into the DNA of the music business.  Without streaming, we are told, then piracy: “Streaming stops piracy”.  Piracy, of course, is a constant, and is factored into sales these days as a limiting factor.  Also factored in is the cost of the faux legality of piracy on DMCA-protected services which also must be managed in order for windowing to work.

Streaming is now baked into the charts, which is the first step to becoming a self-fulfilling prophecy: “Streaming is radio”.  Artists must stream or be lost:  “Windowing punishes fans” (just like selling albums “punishes” fans).

All these myths ignore the basic proposition that windowing, exclusives and other contract based rights are simply ways to divide up our property rights–no more, no less.  And contracts take two to tango–if the deal is bad, no one will take it which undermines the myth.  And like all myths that fall apart when reality diverges from dogma, the curia fights back.

Given Spotify’s monopoly, or certainly dominant, position in their streaming market, it should not surprise that they push all of these myths, and they seem to do it like clockwork whenever Taylor Swift releases a new album.  Why?  Because Taylor Swift has four–count ’em–four albums that sold over one million copies in their first week of US release.  And–she’s the only artist ever to have done so.  And–she windowed every one of them, pre and post Spotify’s US launch.

Title Year Sales
Reputation 2017 1,290,000
1989 2014 1,287,000
Red 2012 1,208,000
Speak Now 2010 1,046,000

Let’s be clear–any distributor getting a Taylor Swift record in the fourth quarter sure makes up for a multitude of commercial sins in their year.  At least that’s true of profit-making companies whose executives actually have consequences for commercial sins.  Loss-making companies, on the other hand, are not motivated by pesky things like profits if they are on the “get big fast and exit” track.  You may say, oh, that’s so 1999, surely they have learned their lessons from the Dot Bomb debacle.

Nah.

The exit is still the thing for these venture backed tech companies.  The problem with exits is that the people who are only in it for the money move on to self-driving cars, climate default swaps, bitcoin or whatever.  People who are in it because they love it are stuck with the consequences.  The music business will be picking up the pieces from the streaming exit for decades because of a simple logic:  You cannot take away something that sold at a $10 price point and replace it with something that “sells” at a $0.005 price point and expect to have a business.  Remember–the trendline since 2008 is predominantly flat so while streaming may be a bigger piece of the pie, the pie itself is not growing much.  That’s cannibalization.  We’ll see how much that trend changes this year–and how much of that change is Taylor Swift.

Recorded Music 1973-2016

Source: RIAA

It must be said that there’s a real question of how many Taylor Swifts the business will sustain going forward if we don’t listen to the lesson she is teaching for those who care to pay attention and think outside the stream.

Remember that salted in the 1,290,000 units that reputation sold in week 1 are quite a few units that were sold as a fan package on an exclusive–there’s that word again–at a higher price point than the general release CD.  That should mean that the gross revenue to the distributor conservatively averages around $8 after discounts or something like $10 million in distributor gross for the week (in the US alone).

Producing that amount of streaming revenue would require approximately 2,000,000,000 streams in a week depending on whose average streaming royalty you buy into.  “Call It What You Want”, Taylor’s first single from reputation, entered HITS song revenue chart at #4 with 9,259,698 streams earning $66,186 (a chart with revenue metrics I have a quibble with due to averaging of free/sub streaming revenue, but that’s another subject).

Regardless of the underlying math, you can see that there is no way that streaming is going to put much of a dent in the revenue from the physical release.  If you are in a future oriented profit making business and not an exit oriented loss making business, you like those numbers.  Why?

Because it tells you that you could probably keep doing this for a while.  That’s called a career, and it’s what managers were supposed to foster.

How was this received at the dominant streaming platform?  Spotify hired the former Lady Gaga manager, Troy Carter, as its “global head of creative services” reporting to one Stefan Blom.  (Mr. Blom was formerly chairman at EMI Nordic, but songwriters will recognize Mr. Blom as the Spotify executive who can’t seem to find millions of songwriters despite Spotify’s vast technical abilities and signs Spotify’s “address unknown NOI” filings with the Copyright Office denying royalties to millions of songs.)

Mr. Carter did not take well to Taylor Swift’s decision to hold the reputation album off of Spotify (notwithstanding reports of Spotify’s recent agreement to accept windowing as a condition of closing its Universal license).  Variety reports:

Taylor Swift’s decision to keep her new album “Reputation” off streaming services like Spotify will drive people back to piracy, said Spotify’s global head of creator services Troy Carter at the Internet Association’s Virtuous Circle Summit Monday morning. [The Internet Association is antagonistic to artists as a general proposition.]  “A lot of it is going to be pirated,” he said. “It kind of sets the industry back a little bit.”

However, Carter also said that he understood Swift’s decision: “Taylor is super smart. We are not mad at her for the decision she made,” he said. Swift and Adele, who sold millions of copies of her “25” album while waiting seven months to release it to streaming services, are among the few artists who can withhold an album from such platforms without significantly impairing its exposure.  [Emphasis mine–note the “among the few” rationalization of the “streaming is inevitable” narrative.  If you shame everyone away from windowing, how will you ever know that it’s a “few”?]

Carter, who managed artists including Lady Gaga and Meghan Trainor before joining Spotify in 2016, was also critical about the music industry’s past business model. “We screwed over consumers for years,” he said, arguing that consumers were forced to buy highly priced albums for years that only included one or two songs they wanted. Carter drew a direct line from this attitude to exclusives on streaming services.

So we have Mr. Carter trotting out several myths at once here–although it must be said that Mr. Carter’s former employer from 2007-2013 is herself not without experience in the rarified air of the First Week Million Club–Lady Gaga herself has one record in that group with her 2011 release, Born This Way.  Of course, with its May 23, 2011 release, Lady Gaga did not have to address the Spotify new release windowing issue as the service had not yet launched in the US at that time.

Even though Mr. Carter was clearly wide of the mark with his advice to Taylor Swift, his messaging was a vast improvement over Daniel Ek’s mansplaining to Taylor on 1989 which was one of the more bizarre public encounters between an artist and a retailer in history.  Can you imagine Tower Records chief Ross Solomon saying any of these things in public?

I still hold the view that the windowing issue changes depending on whether the artist concerned has a fan base that wants their physical record.  If they do, then streaming services become like record clubs.  Nobody ever wanted the clubs to get their record until they’d had at least a 90 day holdback, more frequently 6 months or even a year.  So it is with streaming services, including Spotify.

The bigger questions are what effect windowing has on the ability to sell physical at all.  I’m still waiting to see the consumer research suggesting one drives the other, and based on industry revenues over time, it seems far more likely that streaming cannibalizes physical.  Another question is how much elasticity is there in the subscription price?  If we are expected to welcome low margin streaming as a replacement for higher margin physical and downloads, please don’t tell me that the answer is we’ll make it up on volume, t-shirts or touring.

For now, we have to acknowledge that for artists who anticipate large sales of physical and permanent downloads, singles-only streaming releases combined with physical sales is probably the principal way their distributor can afford to breach the value gap and send enough DMCA notices to keep the album off of YouTube.

 

 

 

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