@scleland: How the Google-Facebook Ad Cartel Harms Advertisers, Publishers & Consumers

How much smoke and fire must there be, and how many people must get burned, before the fire department will investigate and put out a forest fire?

Apparently, a lot, if the forest fire is in the digital ad market that Google and Facebook dominate, and U.S. antitrust authorities are the firefighters.

Where’s the fire here?

Google and Facebook, which don’t directly compete in search and social, together dominate over 70% of the digital advertising market. They also dominate about 80% of online referral traffic, the online oxygen upon which every Internet publisher depends for survival.

After fiercely competing directly with each other in search and social in 2013 and 2014, Google and Facebook abruptly and quietly stopped competing against each other in 2014 with no explanation.

Since then, Google and Facebook have accelerated their capture of almost all digital ad revenue growth and profitability, exposing that Google and Facebook have become a de facto cartel that has illegally divided up the digital advertising space.

In 2014, Google and Facebook apparently decided they could each optimize their growth and profitability by colluding as dominant market complements to each other, rather than competing head-to-head as less efficient search-social competitors.

The economic motivation behind Google and Facebook’s apparent illegal market division is this.

Google takes more share of advertiser demand for lead generation and local business visibility – Google’s special dominance. And Facebook takes more share of advertiser demand for brand awareness and interactivity with consumers – Facebook’s special dominance.

The consumer specialization rationale behind Google and Facebook’s apparent illegal customer allocation is this.

Google takes more share of consumer demand focused on search for local, state, and national news, and the news verticals for business, technology, and job postings. Meanwhile Facebook takes more share of the news and content focused on social subjects like entertainment and lifestyle.

What’s the harm in Google and Facebook efficiently dividing up their markets and allocating customers — besides being per se illegal under antitrust laws?

Read the post on Precursor

@consumerWD: Amazon Prime or Amazon Slime?

[Editor Charlie sez:  Another good reason to link to local retailers for vinyl and CDs and not to a data lord.]

Two Consumer Watchdog reports show that Amazon is deceiving its customers by putting fake crossed-out prices next to its products. It’s a deceptive marketing ploy meant to trick consumers into thinking they are getting a deal for the products they are purchasing when they are not.

Read the post on Consumer Watchdog

@hshaban: Google spent the most it ever has trying to influence Washington: $6 million

[Editor Charlie sez:  Another reason why Google is getting the Register or Die database safe harbor from Sensenbrenner, no doubt.]

Google spent the most it ever has in a single quarter trying to influence elected officials in Washington, according to lobbying disclosures made public late Thursday. The past three months have also seen record spending on lobbying by several other major tech companies, including Amazon, Apple and Uber.

Google Inc., according to the disclosure forms, spent $5.93 million between April 1 and June 30, more than any other corporation in the second quarter. That’s about 40 percent more than it had spent during the same period last year. The only three entities that doled out more money were large business organizations: the U.S. Chamber of Commerce ($11.68 million), the National Association of Realtors ($10.92 million), and Pharmaceutical Research and Manufacturers of America ($6 million).

Since the 2016 election, the tech industry has had to navigate not only a Republican-controlled Congress, but an administration whose decisions have often cut against Silicon Valley’s business interests and generally progressive outlook.

“Some tech companies have only existed in a world when a president [Obama] has largely aligned with them,” said Julie Samuels, the executive director of Tech: NYC, a group that represents New York-based tech firms. “So a lot of people are grappling with how to live in a space where there is tension there.”

Read the post on the Washington Post

 

The Shiv Act: Google’s MIC Coalition Attacks Songwriters with New Back Door Version of Orphan Works Legislation Safe Harbor

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[Editor Charlie update:  Here is a copy of the bill]

Google’s MIC Coalition is at it again.  As predicted, the MIC Coalition is bringing orphan works through the back door with a new bill introduced in the dead of night under the misleading title “ Transparency in Music Licensing Ownership Act” or as we call it, The Shiv Act.

The bill hasn’t been introduced yet so we don’t quite know how bad it truly is, but here’s the summary:

Some of the key provisions of the Transparency in Music Licensing Ownership Act include:

  • Require the Register of Copyrights to establish and maintain a current informational database of musical works and sound recordings while granting the Register authority to hire employees and contractors, promulgate regulations, and spend appropriated funds necessary and appropriate to carry out these functions

  • Ensure that the database is made publicly accessible by the Copyright Office, in its entirety and  without charge, and in a format that reflects current technological practices, and that is updated on a real-time basis

 

Limit the remedies available to a copyright owner or authorized party to bring an infringement action for violation of the exclusive right to perform publicly, reproduce or distribute a musical work or sound recording if that owner/ authorized party has failed to provide or maintain the minimum information required in the database.

That last point is where we get the shiv in the back.  This is essentially saying what Google, Lessig and their fellow travelers have been saying for years–if you don’t observe the formality of registration, then you lose your rights to sue for infringement.

Note that this “register or lose it” approach is soft-pedaled in both the press release

This legislation really puts the “compulsory” in “compulsory licensing” with a vengeance and essentially undermines the very system it purports to “fix”–plus it is an obvious trojan horse for an orphan works regime that Big Tech lusts after behind some librarians–their human shields.  (But see Google and the Myth of Universal Knowledge: A View From Europe by Jean-Noël Jeanneney, the former president of the Biblioteque nationale de France, and Google’s Book Search: A Disaster for Scholars by Geoffrey Nunberg.)

If you have any doubt of what these people are up to, you need only look to the royalty-free 45 million mass NOIs that have been filed already using the registration system that does exist right now.  The idea that the Copyright Office can handle setting up this unicorn database for the benefit of Big Tech at taxpayer expense is kind of a joke–until you realize that there was a “copyright coup in Washington” and the Google-backed Librarian of Congress is likely intending to appoint her own head of the Copyright Office unless the Senate passes S. 1010 the Register of Copyrights Selection and Accountability Act of 2017.

Whatever the discussions have been in the music community about the need for a “global rights database”, nobody ever said “And what we really need is a use it or lose it system that allows Big Tech to question every lawsuit based on whether a work was registered under the right title by the right people at the right time….” and so on and so on and so on.

This legislation has all kinds of potential international implications as did the taxpayer debacle known as the Fairness In Music Licensing Act, which benefited MIC Coalition members but has cost the U.S. taxpayer millions of dollars as a result of treaty violations. The MIC Coalition is back with more crony capitalism asking for another taxpayer funded even safer harbor, a legislated knife to stick in the backs of songwriters and artists.

 

 

@repjerrynadler: Reps. Nadler, @DarrellIssa Pre-1972 Copyright Fix with Introduction of CLASSICS Act

[Editor Charlie sez:  Here’s a link to the bill on Rep. Issa’s page.]

[PRESS RELEASE]

WASHINGTON, D.C. — Today, Ranking Member Jerrold Nadler (D-NY) and Chairman Darrell Issa (R-CA) of the House Judiciary Subcommittee for Courts, Intellectual Property and the Internet introduced bipartisan legislation to close a long-standing gap in federal copyright law. The Compensating Legacy Artists for their Songs, Service, and Important Contributions to Society Act (the CLASSICS Act), H.R. 3301, resolves uncertainty over the copyright protections afforded to sound recordings made before 1972 by bringing these recordings into the federal copyright system and ensuring that digital transmissions of both pre- and post-1972 recordings are treated uniformly.

The CLASSICS Act serves as an update to the “pre-72 treatment” of the Fair Play Fair Pay Act – a broader music licensing bill introduced by Chairman Issa and Ranking Member Nadler earlier this Congress – and represents a broad consensus from a variety of stakeholders across the music landscape.

Congressman Jerrold Nadler: “For years, we have been working to ensure royalty payments for artists who recorded many of our great musical classics before 1972. The Fair Play Fair Pay Act set down a clear marker on the need to resolve the dispute over pre-72 music, as we worked toward a long-term solution that benefits multiple stakeholders. The bill we are introducing today updates this Pre-72 provision, once and for all guaranteeing royalty payments for our great legacy artists while providing certainty for digital music services. Hopefully, this new measure will serve as an example of the consensus that can be reached between the creators and distributors of music as we work to comprehensively update our music licensing laws. Many of these older musicians are past their working years and have no other way to make ends meet. I’m thankful to the supporters of this bill for recognizing that pre-72 recordings have value and that those who create it should be paid regardless of their age.”

Congressman Darrell Issa: “This an important and overdue fix to the law that will help settle years of litigation and restore some equity to this inexplicable gap in our copyright system. It makes no sense that some of the most iconic artists of our time are left without the same federal copyright protections afforded to their modern counterparts. This bill is the product of a great deal of work to build consensus across party lines and varying interests all-over the music and entertainment landscapes on how to best resolve this long-standing problem. I’m very proud of the work we’ve done here. It will go a long way helping bring music licensing laws into the twenty-first century.”

The bill is introduced with the support of stakeholders across the music and entertainment industry including American Association of Independent Music, the Recording Industry Association of America, Pandora, musicFIRST, the Internet Association, the GRAMMYs, SoundExchange, Screen Actors Guild‐American Federation of Television and Radio Artists, American Federation of Musicians, the Content Creators Coalition, the Future of Music Coalition, the Rhythm and Blues Foundation, and the Living Legends Foundation. The bill is also supported by several noted artists, many of whom spoke out in support of the CLASSICS Act.

In addition to Chairman Issa and Ranking Member Nadler, Representatives John Conyers (D-MI), Marsha Blackburn (R-TN), Tom Rooney (R-FL), and Ted Deutch (D-FL) joined as original co-sponsors to the legislation.

BACKGROUND INFORMATION AND ADDITIONAL RESOURCES:

Congress made sound recordings eligible for federal copyright protection with the Sound Recording Amendment of 1971, but the law as passed only applied to works created on or after February 15, 1972. Sound recordings made before 1972 were excluded from federal copyright protection

This gap has meant that different recordings made before 1972 have been subject to an inconsistent patchwork of different laws, creating significant uncertainty for rights holders music creators, and distributors, including digital streaming services, who wish to be able to fairly compensate artists and utilize these recordings.

The differing treatment of pre and post 1972 was an inexplicable and arbitrary oversight on the part of Congress. The U.S. Copyright Office has expressed their bewilderment with the decision, writing in their recent report on federal copyright protections for pre-1972 sound recordings that “Congress did not articulate grounds for leaving pre-1972 sound recordings outside the federal scheme and there is very little information as to why it did so.”

This gap has meant that updates to copyright law and new protections extended to sound recordings under the Copyright Act of 1976 and the Digital Millennium Copyright Act have excluded pre-1972 recordings. The most significant of these being the ‘safe harbor’ provisions for online piracy and ‘compulsory licenses’ made available for internet and satellite radio streaming.

Quotes of praise for the CLASSICS Act:

“This is a great step forward for legacy artists. Thank you to Representatives Issa and Nadler for recognizing that music made before 1972 is just as important and valued as post-1972 music.” — Mary Wilson, The Supremes

“I am overjoyed and extraordinarily grateful for Congressmen Issa and Nadler’s bipartisan relentless efforts to correct an inequality in the law that discriminates against myself and my peers– the legacy artists who recorded our hit records prior to 1972. It is has been unfair and outrageous that the artists, such as myself, who recorded some of our country’s most iconic music, have been forced to resort to lawsuits in order to get paid for the commercial use of their recordings. It is phenomenal that finally there is light shining at the end of this very long tunnel we’ve been looking at for so long. Knowing there is a consensus agreement to resolve any portion of this outrageous problem makes me proud and furthers my hope that I will still be alive to see the other issues Reps. Nadler and Issa have championed in the Fair Play Fair Pay Act come to similar positive bipartisan resolution and conclusion.” — Sam Moore

“I have found so much inspiration in the songs of the past, the songs I grew up with. The least – the very least – I could do is show them respect and honor them by urging Congress to fix the law so that they can get paid by digital radio. That’s why this bill is so important.” — Melissa Etheridge

“Every artist making music today stands on the musical shoulders of those who came before them. I would not be doing what I do if it weren’t for the heritage acts I grew up listening to, idolizing and trying to emulate. The fact that these amazing artists are not getting compensated for their indelible work and profound influence is simply unfathomable to me, and must be fixed. I am grateful to the sponsors of this bill for finally trying to even the scales, as there is no future in music without honoring the past.” — Dave Koz

“It’s a travesty that artists who shaped our creative minds and inspired us to want to play music in the first place are not being  acknowledged and compensated for the music they gave us.  I’m hopeful this important legislation will address this issue for all time.” — Carlene Carter, Singer-Songwriter, Daughter of country music legends June Carter Cash and Carl Smith, stepdaughter of Johnny Cash, and granddaughter of “Mother” Maybelle Carter of the original historic Carter Family

“The fact U.S., copyright protection does not apply sound recordings made prior to February 15, 1972 makes absolutely no sense.   Early rockers like me and my peers are on heavy rotation these days on popular oldies channels and on digital radio services.  And unlike many other platforms, we’re not compensated for it. How is that fair? It’s our music that attracting listeners and thus we should be paid.   I’m grateful for the leadership of Reps. Issa and Nadler and their efforts to fix this enormous injustice with this important bill.” — Steve Cropper, legendary guitarist, songwriter and producer

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@musicscribeLA: In Quincy Jones Trial, Expert Critiques Pitbull’s Version of Michael Jackson’s ‘Bad’

Pitbull is no Michael Jackson.

That was the gist of the expert testimony that highlighted the fourth day of the trial that pits legendary producer Quincy Jones against the Michael Jackson estate, with Jones claiming that the late King of Pop’s estate breached its contract with him and owes him millions of dollars in royalties from works that include songs from the albums Thriller, Off the Wall, This Is It and Bad.

Jones had sued the Jackson estate and Sony Music Entertainment in 2013, alleging that songs such as “Billie Jean,” ”Thriller” and “Don’t Stop ‘Til You Get Enough” were re-edited to cut him out of royalties and a producer’s fee. The suit also claimed that Jones’ contracts gave him the first opportunity to re-edit or alter the songs, partly to protect his reputation.

On Friday, Jones’ legal team called Michael Fremer, editor of AnalogPlanet.com, to the stand, in hopes of establishing that some of Jackson’s posthumously released remixes — issued without Jones’ permission — had diminished Jones’ reputation due to their mediocrity.

Read the post on Billboard

@musictechpolicy: Hey Alexa, Where’s My Money? Address Unknown Update Courtesy of Paperchain

We get an update this week on the total “address unknown” mass NOIs filed with the Copyright Office for the royalty-free windfall loophole.  This time we have to thank our our friends at Paperchain in Sydney for doing the work of decompressing the massive numbers of unsearchable compressed files posted on the Copyright Office website.  As you can see, there’s been an increase of approximately 70% since January 2017.   (For background, see my article.)

As you can see, Amazon is still far and away the leader in this latest loophole designed to stiff songwriters, followed closely by Google.  However, Spotify is moving on up.  Spotify does get extra points for starting late in March 2017, but they are catching up fast filing over 5,000,000 as of last month.

Read the post on MusicTechPolicy