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Copyright

What the 1984 Betamax ruling did for us all – latimes.com.

It had no precedent and while Sony’s Betamax format lost out to VHS this groundbreaking US Supreme Court ruling, 30 years ago today, in favor of Betamax is why we can rejoice about much of the technological innovation we benefit from today.

There is much talk today about how the US Supreme Court is set to hear the Aereo lawsuit brought on by broadcasters and the many parallels to the Sony Betamax case.  As Aereo CEO + Founder, Chet Kanojia, stated in the company blog:

“This case is critically important not only to Aereo, but to the entire cloud computing and cloud storage industry. The landmark Second Circuit decision in Cablevision provided much needed clarity for the cloud industry and as a result, helped foster massive investment, growth and innovation in the sector. The challenges outlined in the broadcasters’ filing make clear that they are using Aereo as a proxy to attack Cablevision itself and thus, undermine a critical foundation of the cloud computing and storage industry.

“We believe that consumers have a right to use an antenna to access over-the-air television and to make personal recordings of those broadcasts. The broadcasters are asking the Court to deny consumers the ability to use the cloud to access a more modern-day television antenna and DVR. If the broadcasters succeed, the consequences to consumers and the cloud industry are chilling.

What many may not realize is how the Betamax ruling influenced the birth of the digital music industry and helped a little known company, Diamond Multimedia, defeat an RIAA lawsuit against its Rio MP3 player.  The year was 1999 and the way we consume music has never been the same since.

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Knock knock.  Who’s there?  Spotify.  Spotify who? Right, did you spot who’s got my royalty check!

If you’re a recording artist looking for a payout from music streaming services like Spotify, Pandora, Grooveshark, Last.fm, MOG, Rdio, iTunes Radio (in the works) and the list goes on — have you heard of Soundhalo, that’s the UK start-up Thom York & Nigel Godrich ditched Spotify for? — and you’ve only now begun to complain about the lack of dollars on your royalties checks, then I’ve got one simple question for you: Where the fuck have you been?

Bye bye Thom and Nigel… What’s that Mr. Lowery (of Camper Van Beethoven & Cracker fame), you don’t like the internet “exploitation economy”?  Come again Pink Floyd, Pandora’s founder TIm Westergren is deceitful because he wants to cut Pandora’s royalty rates!!!

Dave, Roger, Nick WTF you’re Pink Floyd, what’s wrong with you guys? I realize you’re just a tad removed from your progressive heyday but that’s no reason to shit on Westergren because the poor bastard is trying to run a business against entrenched radio titans like Clear Channel and Cumulus, who by-the-way (in case you didn’t know) still do not pay a dime of royalty to the artists performing the songs on their airwaves, let alone to the labels.  Did you know the US is the only industrialized nation that does not have a terrestrial broadcast performance right for sound recordings?  This puts us in the same league as Cuba, Iran and North Korea.  I know you think nothing of charging $1,000+ for a concert ticket today and that it’s because of your demi-god status that Pandora should have split its IPO raise 50/50 with you to justify Pink Floyd’s presence on their service, but c’mon!!!

The National Association of Broadcasters (NAB) recently took out newspaper advertisements claiming having to pay performers when playing their music is “bad for radio, bad for artists and bad for listeners.”  Pandora’s operating at a loss of $36MM for last year and Spotify has shelled out over $500MM since launch.  So where is all this money from streaming services going if not in your artist pockets?

It’s paying to maintain this broken, antiquated, lardish, myopic industry starting with the labels, who this time said we’re getting paid no matter what, and the artists, well, fuck the artists… we (the labels) working in cahoots with our PRO (Performance Rights Organization) partner, SoundExchange, are going to make sure this piggy gets fed right and first… and the artists, well fuck them!  But the industry failing doesn’t stop with the labels.  If a home purchased by Pandora’s CTO is news, then when are the gluttonous salaries of label, music publisher, and PRO Presidents & CEOs going to be news?  The entire edifice is crumbling because no one wants to change.  ASCAP, BMI & SESAC are supposed to be not-for-profit PROs for crying out loud, at the service of their songwriters & publishers membership, yet their collective enforcement power is clearly in NAB’s pocket and they too like radio programmers must be bought.

Artists, when are you going to start talking about boycotting radio and pulling music from the terrestrial airwaves so you’re finally and fairly compensated by an industry that has been milking you dry, sucking at your teet for decades?  Don’t you see the problem isn’t solely Spotify, or Pandora or any of these other streaming services?  When are you going to ask the labels to provide you with transparent accounting so you can see how much they’re skimming from the top?  When are you going to have the guts to say “Fuck this” and find ways to connect with your fans directly and once-in-for-all disintermediate this flailing music industry instead of sending off lame-ass tweets like “It’s up to streaming providers to come back with a better way of supporting new music producers..” (Nigel Godrich)?  In fairness to Godrich this tweet is part of a series in which he points to the salacious behind the scenes deal making major labels did with Spotify to both own a piece of the company and get more favorable royalty rates, but still.

Until that time, do not complain until you’re actively doing something to personally shake up the status quo, and enjoy the simple fact that your music can now be heard by millions more people because Spotify, Pandora and others are actually carrying it.

Copyright Royalty Board To Set Mechanical Royalty Rates For Digital Music Services | Billboard.biz.

I love the hyperbole of this story.  Leave it to music industry trade organizations to call this a major settlement.  What a crock of sh*t!  After years of acrimonious wranglings, posturing and petulance, all these industry dinosaurs could come up with to bring some semblance of sanity to the digital music licensing process was to rely, again, on the legislative intervention of the Copyright Royalty Board (CRB)…… sigh!

I prefer the frankness of Digital Music News when referring to this ‘historic’ accord:

That said, something did happen here – even if it was in a licensing corner.  In a nutshell, pre-existing mechanical licensing structures related to paid downloads, subscription services like Spotify, and ringtones will largely remain the same, with newer rates established for emerging platforms like mixed-format bundles, locker services, and concepts like Muve Music.  Most involved ‘greater than calculations’ and a rash of complicated percentages and formulas.

Thanks Paul.  In short, if you’re a music publisher, you’re doing better.  Everyone else, get in line, maybe you’ll see some ducats.

How many of you have heard of Muve Music by Cricket Wireless?  Launched in January 2011, this phone bundled with an all-you-can-eat music service topped 500,000 subscribers one year later and they’re adding over 10,000 subscribers a week.  Granted the music is stuck to your phone, but you get millions of song, all readily and easily accessible to play back via the phone.  At $65/month for unlimited talk, text and music playback that’s a good frickin’ deal.  I pay twice as much with AT&T and have no music service in my plan.  The beauty of the Muve Music service is how Cricket Wireless knows exactly what you’re downloading, listening to and how often.  The customer details they have are a gold mine and I hope they’re leveraging that information to keep their costs down when negotiating with labels directly.

It would be so much easier if Cricket Wireless had access to the ToBeDigital exchange I proposed in my previous post.  It’s going to take some time before artists and songwriters trust themselves enough to collaborate on gaining fans and dollars chaordically, however, now that they’ve finally recognized there’s gold in tending directly to them copyright fields they’re much likelier to exploit their copywares by themselves.  A similar idea comes from Ian Rogers, the CEO of Topspin Media, who proposed the construction of a machine-readable, rules based content registry into which content owners can easily opt-in or out after having set up the rules and the prices for the different use of their content.  As Rogers says very eloquently:

The upside to the industry as a whole is massive, developers willing to play by the rules can integrate media into their apps (and pay for the rights to do so) simply, and a true digital marketplace for content governed by market forces, not gatekeepers of large catalogs of content. I strongly believe the net of this will be more money to content owners more quickly than the current course we’re on today. We keep hearing “digital music needs to get to scale quickly for the music industry to succeed”; why wait for one player to scale when you could scale an industry of players?

By “players” he means you artists, you songwriters, you who actually create AND own something.  So what are you waiting for???

In the Battles of SOPA and PIPA, Who Should Control the Internet?

Every now and again a great article, like this one in this month’s Vanity Fair, springs forth from the cabals of cultural journalism to adroitly and accurately summarize what’s in play when it comes to the Internet.  More importantly this is the first time I hear of the forces of Organized Chaos being up against the forces of Order & Disorder.

While some may find this way of framing the battle for the Internet as overly simplistic, I have long argued artists have the best chances for success when they collaborate and cooperate to embrace the chaotic forces of the Internet.  This is how a Chaordic Organization functions as defined by the CEO Emeritus of Visa, Dee Hock:

By chaord, I mean any self-organizing, adaptive, nonlinear complex system, whether physical, biological, or social, the behavior of which exhibits characteristics of both order and chaos or loosely translated to business terminology, cooperation and competition.

* Dee W. Hock “The Chaordic Organization – Out of control and Into Order – 1998

In his amazing book, Birth of the Chaordic Age, Hock provides a blueprint for all artists to follow, one that requires artists to get away from music being sold solely as a product to one that emphasizes the importance of music being consumed as a 24/7/365 global service: A service that does away with sovereignty, drowns out piracy, respects privacy and provides security.  How?

Just like Hock convinced Bank of America to give up ownership and control of their BankAmericard credit card program and turn it into a non-stock membership corporation equally owned by all of its member banks eventually called VISA, I am suggesting all artists worldwide give up on sovereign copyright protectionism and embrace a global copyright exchange, called ToBeDigital, equally owned by all of its copyright bearing members be they artists, labels, songwriters or publishers.

Just like VISA facilitates EFTs (electronic funds transfers) throughout the world, ToBeDigital would facilitate ERTs (electronic rights transfers) granting immediate, redeemable access to music to fans on any playback device once they’ve paid a nominal interchange fee + the value of the music purchased set by the merchant.

For a fraction of what artists pay out today to Performing Rights Organizations (PROs) around the world, not only would artists get paid much faster on what they sell, they’d get paid on everything they sell and do away with weightings which are employed by PROs to assign a greater or lesser monetary value to music performances in broadcast media.

And for music fans there would be nothing but complete clarity, total ubiquity and pure enjoyment.

If you’re serious about the business of music, then do yourself a favor and read Don Passman’s book, All You Need To Know About The Music Business.  It is THE music business playbook, the best book out there for artists bar none.  Passman’s book is all about the details, definitions, nuances and everything in between.  He’s on his 7th Edition © 2009 and he’s got tons of info on the digital state of things in this Information Age we now live in.

Note, the only thing missing from Passman’s book are the “tasty bits”, that is real world examples of the actual contracts & financial statements – be it Recording Agreement, Publishing Agreement, royalty statement, PRO statement, etc. – all the things Don gets paid handsomely to negotiate for you.

SoP plans to remedy this by offering for download and review as many contracts and statements as we can get our hands on so we’re talking not just in the abstract but also looking at concrete examples of what’s really going on.

In the meantime, READ THIS BOOK, and familiarize yourself with the jargon because you’re going to see plenty of it here.