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Is YouTube The Lyor Show?

June 21, 2018 Comments off

MIKE

Christof, let me ask you, why do you think that Truman has never come close to discovering the true nature of his world until now?

CHRISTOF

We accept the reality of the world with which we’re presented. It’s as simple as that.

from The Truman Show, written by Andrew Niccol

You’ll hear a lot of trash talk about Lyor Cohen, but credit where it’s due–he gave an interview that interested me about how he sees his role at YouTube.  I actually think he’s got some old school ideas that may be fundamentally sound, but are not connected to the Google reality.

I submit that his problem is that either he’s getting paid so much money he doesn’t need to be attached to reality or he doesn’t understand that Google does not give a rip about us.  Or maybe it’s a little of both.

Lyor’s main problem is that he either doesn’t understand or chooses to ignore Google’s exploitative business model.  MTP readers will recall a prescient 2008 book review of Nicholas Carr’s The Google Enigma (entitled “Google the Destroyer“), by antitrust scholar Jim DeLong that gives an elegant explanation of Google’s mindset:

Carr’s Google Enigma made a familiar business strategy point: companies that provide one component of a system love to commoditize the other components, the complements to their own products, because that leaves more of the value of the total stack available for the commoditizer….Carr noted that Google is unusual because of the large number of products and services that can be complements to the search function, including basic production of content and its distribution, along with anything else that can be used to gather eyeballs for advertising. Google’s incentives to reduce the costs of complements so as to harvest more eyeballs to view advertising are immense….This point is indeed true, and so is an additional point. In most circumstances, the commoditizer’s goal is restrained by knowledge that enough money must be left in the system to support the creation of the complements….

Google is in a different position. Its major complements already exist, and it need not worry in the short term about continuing the flow. For content, we have decades of music and movies that can be digitized and then distributed, with advertising attached. A wealth of other works await digitizing – [music,] books, maps, visual arts, and so on. If these run out, Google and other Internet companies have hit on the concept of user-generated content and social networks, in which the users are sold to each other, with yet more advertising attached.

So, on the whole, Google can continue to do well even if leaves providers of its complements gasping like fish on a beach.

And that was the truth in 2008 and its still true of Google ten years later because that’s their business model.  So when Irving Azoff says of Google that YouTube doesn’t pay artists and songwriters adequately–even the top songwriters in the world who are members of Irving’s Global Music Rights–that’s entirely consistent with the predatory business model Jim DeLong identified.

And when Lyor tries to flatter and deflect his way around Irving’s criticism, he’s missing the point entirely which is not surprising given that he works there.  But it doesn’t change the fact that Irving is right—Google is built on an exploitative business model that depends on using the DMCA safe harbor to undermine basic private property concepts and complete one of the biggest income transfers of all time to the great detriment of artists and songwriters.

MTP readers will also remember my 2007 post, The DMCA is Not an Alibi, now called “the value gap.”  That was the one that really started criticisms that I had a Google problem.  I can’t tell you the number of times that people have come up to me and confessed that they didn’t see what I was driving at until years after.  Not that it matters, but important years were lost when people in positions to marshal resources to combat them simply failed to do so.

Nothing has changed since Jim and I wrote those pieces and nothing will change until there are tectonic shifts in how Google is permitted to operate and the loopholes it relies on.  We’re thankful of the victory in Europe, but as one loophole closes in Europe, another opens in the US through the Music Modernization Act’s inexplicable and likely unconsitutional reachback safe harbor.

In a recent Billboard interview, Lyor said:

“Prior, [YouTube would] make a deal with the industry, go away for a few years and then come back. And that, to me, is where misunderstandings happen,” he explains. “It’s really hard to find an artist and break that artist — I mean, it’s almost impossible. So if Google and YouTube understand how difficult it is, maybe they could think about ways to improve that part of the business….”

How did you alleviate the disconnect between YouTube and the music industry?

Just going back to back with them. Demystifying our intent. Understanding how hard it is to break artists and to go to work on behalf of the creative community and the labels.

I think Lyor is essentially correct in his old school assessment of Google’s “new boss” problem, but he’s treating the wrong symptom.  It’s not that Google doesn’t understand anything, they understand just fine how hard we think it is to break an artist in the music business.  They just don’t care and to the extent they think about it at all, they think that we don’t understand because they think they “break” YouTube “stars” when those “stars” get corporate sponsorships.

And that is because their business model is based on manipulating loopholes and not on “breaking artists,” if “breaking artists” means establishing artists as able to have successful careers apart from YouTube.  And that dependency has become clearer in the years since Jim wrote his “flopping on the beach” post which makes Google’s commoditization even more insidious.

So while we’re happy that the Europeans have seen the light on the “value gap,” the DMCA is still not an alibi–unless the U.S. government continues to fail to address the underlying cause of the new algorithmic Darwinian music business that is gradually asphyxiating artists and songwriters.

And while we can appreciate Lyor’s old school view of his role in the Google Nation, no one should be persuaded that his approach will change anything as long as one of the largest corporations in commercial history is allowed to weaponize the DMCA safe harbor.  The artists Lyor is focused on “helping” aren’t just flopping on any beach, they are flopping on Google’s beach, one way or another.

Big Tech Going to Capitol Hill to Explain How they Profit from Terror

January 17, 2018 Comments off

Facebook’s Monika Bickert, YouTube’s Juniper Downs and Twitter’s Carlos Monje will testify today at the U.S. Senate Commerce Committee to explain how their company’s profit from terror groups using their platforms.  The hearing, Terrorism and Social Media: #IsBigTechDoingEnough? at 10 am ET today.

As Ranking Member Senator Bill Nelson noted, the hearing is the first time that all three of Facebook, Google and Twitter have deigned to appear before the Commerce Committee at the same time:

[T]heir appearance is long overdue.  These social media platforms – and those of many other smaller companies – have revolutionized the way Americans communicate, connect and share information.

But, at the same time, these platforms have created a new – and stunningly effective – way for nefarious actors to attack and harm our citizens and our nation.  Frankly, it is startling that today, a terrorist can be radicalized and trained to conduct attacks all through social media.  And then a terrorist cell can activate that individual to conduct an attack through the internet – creating in effect a terrorist drone controlled by social media.

I look forward to hearing from our witnesses about what their companies are doing to make sure their platforms are not being exploited and manipulated by terrorists and criminals.

Using social media to radicalize and influence users is not limited to extremists.  Nation states, too, are exploiting social media vulnerabilities to conduct campaigns against this nation and interfere with our democracy.

We know that Russian hackers—at Vladimir Putin’s direction—attempted to influence the 2016 presidential election through cyberattacks and spreading propaganda and disinformation through paid social media trolls and botnets on Facebook and Twitter.

And, we also know that Putin is likely to do it again.

In its January 6, 2017 assessment, the U.S. intelligence community said that Putin and his intelligence services see the election influence campaign as a success and will seek to influence future elections, right here in the United States, and abroad.

This should be a wake-up call to YouTube, Facebook, Twitter and to all Americans, regardless of party. This was an attack on the very foundation of American democracy and we must do everything in our power to see that it never happens again.

It would be interesting if Senator Nelson could ask Facebook, Google and Twitter if they could run a quick tape to tell the people how much they made, give or take, on selling ads against terror recruiting videos.

 

 

Must Read from @schneidermaria: Thoughts on “Net Neutrality” From Down Here in the Coal Mine – Guest Post Maria Schneider

December 6, 2017 Comments off

Maria Schneider is a 5-time GRAMMY-winning composer/bandleader in jazz, classical and for her work with David Bowie. An outspoken advocate for the rights of musicians, she has testified before Congress, and teaches and performs throughout the world. 

When Google really really wants something, it’s a marvel to watch how it hides its own greedy motives, while using surrogate groups, political polarization, and their own power over information networks to whip up a national outcry – all as Google feigns concern for the “public good.” Google has now orchestrated just such a public outcry over the vague phrase “net neutrality.” It’s a phrase that has most of us, including John Oliver (see John Oliver’s piece), biting hook, line, and sinker. I smell something rotten.  As musicians, we’re the canaries in the proverbial coal mine. We’ve long been taken on this ride by the world’s biggest data lord, and we’ve developed a keen nose. We’ve been coughing up blood down in this damn mine for too long to not take notice when new wafts of rotten stench make their way down here – especially when we look up the dark shaft and see rainbows spelling the word “Google” beneath radiant blue skies.

So I figured it was time to dig into this phrase “net neutrality” and see what it’s all about. And sure enough, as I’ll explain below, this appears as just another typical Google scam where they systematically create mass hysteria that the little guy is going to somehow be hosed. I’m afraid to say, the public is being duped.

Read the post on The Trichordist:  Thoughts on “Net Neutrality” From Down Here in the Coal Mine – Guest Post Maria Schneider — The Trichordist

The Information’s Expose on Google’s Hostile Work Environment is a Cry for Corporate Reform

December 1, 2017 2 comments

“All animals are equal, but some animals are more equal than others”

Animal Farm: A Fairy Story by George Orwell

The Information has conducted an extensive review of Google’s apparently hostile work environment and one thing is clear–all the stories we heard about Google’s headman, Eric “Uncle Sugar” Schmidt really have had the predictably corrosive effect.

The romantic relationships within the walls of Google made ideal fodder for gossip columns and magazine profiles.

Co-founder Larry Page dated Google lieutenant Marissa Mayer in the company’s early days, and co-founder Sergey Brin later drew attention for dating Amanda Rosenberg, a younger colleague. CEO Eric Schmidt dated publicist Marcy Simon when she did work for Google. The stories had sex, money and power against a backdrop of one of the world’s largest tech empires. It was like something out of a rebooted soap opera—Dynasty 2.0.

But an examination by The Information found that those interoffice relationships, and others featuring some of the company’s top leaders, have for years been a flashpoint of frustration and anger among Google’s employees. The relationships often violated at least the spirit of a company policy that prohibits superiors from secretly dating subordinates. But employees noted that there had been no apparent repercussions for the powerful, mostly male, leaders who had such relationships.

As a result, many Google employees expressed the opinion that the company’s culture appears to tolerate, or even endorse, such workplace relationships. In interviews with nearly 40 current and former Google employees, many said the issue had tainted the perception of women who earn promotions, created uncomfortable encounters at off-site events and had raised concerns over whether human resources would address inappropriate conduct. Some described their own experiences with sexual harassment at the company.

And it goes on from there.  While you may ask, where was the board, the Google board of directors was actually exactly where Uncle Sugar wanted them to be:  In the words of the Rolling Stones’ classic, under his thumb.

of-all-the-ceos-google-interviewed-eric-schmidt-was-the-only-one-that-had-been-to-burning-man-which-was-a-major-plus

Eric “Uncle Sugar” Schmidt at Burning Man

The Roman dictator Sulla is credited with originating the practice of decimatus from which we derive the word “decimation”.  The practice was military in origin and was a punishment meted on a Roman cohort often for the dishonor of the unit such as mutiny or abandoning the line.  The cohort (about 500 men) was divided into groups of 10 and each group drew lots to identify a single soldier to be killed by the others, usually clubbed to death.

Google practices a kind of reverse decimation as the three Google insiders Eric Schmidt, Larry Page and Sergei Brin are the only Google stockholders who are allowed to hold a class of stock that gives them 10 votes for each share.  And extending the Roman motif, holding this 10:1 voting power over other Google stockholders affords them a kind of co-emperor status–for you Roman Empire fans, think Diocletian and Maximian.  I guess you could say that Schmidt is the senior co-emperor and Page and Brin are the junior co-emperors.

But co-emperors they are indeed with a 10:1 power to decimate the lesser stockholders who dare challenge them.

The futility of stockholder votes at Google is obvious at Google stockholder meetings where ordinary stockholders are routinely decimated by the 10:1 voting power of the co-emperors.  The predictable results of the voting are often announced by David Drummond, the company’s head lawyer, who is himself implicated in The Information’s report.

So when you are reading The Information’s report on the internal workings of Google, just remember that not only were the employees captive to the Google culture, the perpetrators also had complete control of their board of directors.  In addition to the other takeaways from this sorry episode, it should be obvious that not only should Google be broken up, but the Google method of insider control needs to be thoroughly investigated.

Guest Post by @schneidermaria: Google’s Self-driven “Carma”

May 17, 2017 1 comment

Maria 17

[Editor Charlie sez: We’re pleased to publish this guest post written by Maria Schneider, a five-time GRAMMY-winning composer and bandleader, a board member of the Council of Music Creators, and an active supporter of MusicAnswers.org. Her GRAMMY awards including two 2016 GRAMMY Awards, Best Arrangement, Instruments and Vocal for “Sue (Or in a Season of Crime)” recorded by the Maria Schneider Orchestra and David Bowie, and Best Large Jazz Ensemble Album for “The Thompson Fields”.  Maria’s posts on MTP can be found here.]

Written by Maria Schneider

It’s the height of irony that Google finds itself in court suing Uber over the piracy of documents and creative works it believes should be protected as its intellectual property (IP).  The lawsuit is a battle royale between two mean-spirited data lords, each wrestling to secure its world domination over self-driven cars.

My short summary of their self-driven car case goes like this:  Google offered Anthony Levandowski a whopping 120 million dollars to head their self-driving car development.  Loyalty not being his strong suit, Lewandowski left Google after a few short years, and not before pirating 14,000 drawings, plans, and other creative works Google had spent a ton of time and money to create.  He then used those 14,000 stolen digital files to start his own company, Otto.  Within a year, Uber made Levandowski insanely rich when it bought Otto from him for 680 million dollars.

Google alleges that Uber and Levandowski have “illegally downloaded” Google’s creative works and distributed them to others.  Google is outraged to find its valuable IP in the hands of hundreds of Uber engineers and employees, none of whom have any obligation to Google.  Realizing that their valuable creations will now surely spread to others and devalue Google’s investment even further, Google’s attorney, Mr. Verhoeven, insists that the damage to Google is “irreparable,” exclaiming, “you really can’t put the toothpaste back in the tube!”

Ah yes, karma is a bitch.

Whatever sting Google is feeling, it’s but a mosquito bite compared to the wounds Google has inflicted upon creative artists: composers, songwriters, recording artists, authors, filmmakers, journalists, cartoonists, photographers, the list goes on.  It’s an incalculable number of individual livelihoods, deeply damaged, if not destroyed by IP theft, not only in the United States, but worldwide, all at Google’s greedy hand.

If Google’s claims come to bear in court, Levandowski could go to jail.  Uber’s attorneys and managers could be fired for buying what was obviously “hot merchandise.”  And Google’s attorneys and management will surely be reprimanded for not having better protections in place to protect Google’s valuable IP.  But should anything about all of this surprise Google?  The highly coveted, wildly overpaid man-boy, Levandowski was just a bad apple that didn’t fall far from the tree.  He was only paying forward the general culture Google itself created – a culture Google has imposed on the entire world through its monopoly on information, its massive market power, and its incessant lobbying to destroy others’ intellectual property rights for its own financial gain.

Let’s go back to 2006.  Back then, Google was kicking the tires of YouTube, trying to decide if Google should acquire it.  In trying to make that decision, these following statements were made by Google’s management:

“I can’t believe you’re recommending buying YouTube . . . they’re 80% illegal pirated content.”

YouTube is a “rogue enabler of content theft.” 

YouTube’s business model is completely sustained by pirated content.”

Even armed with that corporate knowledge, Google gave a big thumbs-up to what they clearly recognized as theft, and went ahead and bought YouTube for 1.65 billion dollars.  And since then, Google has ridden the YouTube train, loaded with its massive cargo of stolen goods, to become the most powerful company the world has ever known.

Google’s culture of disrespecting and exploiting other people’s IP is finally coming home to roost.  With some sort of perverse poetic justice, Levandowski has now done unto Google what Google has done unto others.

Buddha offers the world very powerful words about bad karma: “One who previously made bad karma, but who reforms and creates good karma, brightens the world like the moon appearing from behind a cloud.”

It’s time for gargantuan data lord companies like Google to turn away from darkness and reform, to generate a different karma that brightens the world around them.  It’s time for these companies to stop enabling piracy, to stop making revenue off it, and to stop making revenue off of terrorism, pornography, and fake news, as well.  It’s time they pay a fair amount to acquire content, and pay fair taxes on the valuable data they extract from their billions of worldwide users.  It’s time these companies accept responsibility for the daily crimes that occur on their platforms, instead of hiding behind their weaselly, “we’re not accountable under the DMCA” approach.

It’s high time these companies stop “moving fast and breaking things,” and start driving a little slower and more respectfully, obeying the basic rules of the road.  It’s time for them to make a complete U-turn on our information highway, and steer in the direction of nurturing an internet community based on respect and fairness.  More than needing judges, regulators, lobbyists, lawmakers, or even “moonshots” like self-driving cars, what companies like Google most need, is a shiny brand new karma.

_________

To see more of Maria Schneider’s writing, go to Advocacy for Musicians at Maria Schneider’s Wikipedia page.

Funny How that Works: @edchristman reports: Irving Azoff, Top Radio Groups Reach Temporary Licensing Agreement

December 27, 2016 Comments off
mic-coalition-rmlc

The MIC Coalition

When two rational actors are economically interdependent on one another, disputes tend to get solved at a market clearing price.  So it is with Global Music Rights and the goliath Radio Music License Committee that itself is a member of the even bigger goliath MIC Coalition.  (My bet is that the Google-backed MIC Coalition is behind the bizarre push for 100% licensing by soon-to-be-former head of the US Department of Justice Antitrust Division, but that’s another story.)

As Ed Christman reports in Billboard:

While the Radio Music Licensing Committee and Global Music Rights continue to pursue anti-trust litigation against each other, the boutique performance rights organization started by Irving Azoff is offering temporary licenses that will allow radio stations to continue playing GMR songs without worrying about copyright infringement lawsuits.

According to a statement issued on behalf of GMR by lawyer Dan Petrocelli of O’Melveny & Myers, representing the PRO in the antitrust litigation; and a letter to RMLC members from RMLC chairman Ed Christian, radio stations have until Jan. 31 to sign an interim license agreement with GMR, which will cover them for playing the PROs songs through Sept. 30, 2017.

Each station willing to enter into the interim license has to contact GMR to see what their fee will be. However, the interim licensing agreement will leave each party the right to seek a retroactive fee adjustment, which could be based on a future licensing agreement subsequent to the interim license; the outcome of the antitrust litigation between the RMLC and GMR; or a possible rate settlement between the RMLC and GMR….

In fact, some music from songwriters in the Who, the Eagles, and by John Lennon and Drake, are no longer covered by ASCAP or BMI, and radio has been playing that music all along during 2016. But people familiar with GMR say they had no intention of suing for copyright infringement as long as RMLC was negotiating rates with the PRO.

Instead, they claim, the RMLC ambushed them with an antitrust lawsuit filed on Nov. 18  in the U.S. Eastern District of Pennsylvania Court by the law firm of Latham & Watkins. GMR filed its own anti-trust lawsuit, via O’Melveny & Myers, against the RMLC in California Federal Court on Dec. 6.

The songs at issue appear to be for GMR writers who left ASCAP in the last couple years, but arguably remain covered by ASCAP (and BMI) agreements expiring at the end of 2016–you know, next week.

What this comes down to, of course, is the one thing that the MIC Coalition doesn’t seem to think songwriters are much entitled to–property rights.  As my old law and economics professor Armen Alchien has written:

A property right is the exclusive authority to determine how a resource is used…One [attribute of private property] is the exclusive right to the services of the resource. Thus, for example, the owner of an apartment with complete property rights to the apartment has the right to determine whether to rent it out and, if so, which tenant to rent to; to live in it himself; or to use it in any other peaceful way. That is the right to determine the use. If the owner rents out the apartment, he also has the right to all the rental income from the property. That is the right to the services of the resources (the rent).

Finally, a private property right includes the right to delegate, rent, or sell any portion of the rights by exchange or gift at whatever price the owner determines (provided someone is willing to pay that price). If I am not allowed [or not required] to buy some rights from you and you therefore are not allowed to sell rights to me, private property rights are reduced. Thus, the three basic elements of private property are (1) exclusivity of rights to choose the use of a resource, (2) exclusivity of rights to the services of a resource, and (3) rights to exchange the resource at mutually agreeable terms….

Private property rights do not conflict with human rights. They are human rights. Private property rights are the rights of humans to use specified goods and to exchange them. Any restraint on private property rights shifts the balance of power from impersonal attributes toward personal attributes and toward behavior that political authorities approve. That is a fundamental reason for preference of a system of strong private property rights: private property rights protect individual liberty.

Or as Gloria Steinem put it, artist rights are human rights.  A host of human rights documents are consonant with this view, starting with Article 27 of the Universal Declaration of Human Rights (which, incidentally, was itself the inspiration for MTP):

Everyone has the right to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author.

The MIC Coalition routinely runs over the rights of recording artists to fair compensation for the use of their recordings, so it’s a fair assumption that they are used to riding rough on creators and intend to do so with GMRs writers.  We can all be thankful that GMR is both standing up for their songwriters and acting reasonably to allow business to get done.  Hopefully, mega media corporations will decide that their resources are better spent paying a fair royalty to the songwriters that drive their business rather than unproductive litigation.

 

@jonathantaplin: Forget AT&T. The Real Monopolies Are Google and Facebook. — Artist Rights Watch

December 13, 2016 Comments off

The proposed merger of AT&T and Time Warner has drawn censure from both sides of the political aisle, as well as a Senate hearing that looked into the potential for the combined company to become a monopoly. But if we are going to examine media monopolies, we should look first at Silicon Valley.

via @jonathantaplin: Forget AT&T. The Real Monopolies Are Google and Facebook. — Artist Rights Watch

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