Pandora’s founding CEO Tim Westergren, who returned to the top job just last year, intends to step down as the streaming service’s leader in the near future. According to Recode, which cites “people familiar” with the plans, Westergren won’t go anywhere until a replacement has been found and is in place.
In proposing to buy WholeFoods for $14b, Amazon has surprisingly invited unwelcome serious antitrust investigation into, and public discussion about, Amazon’s core conflicted retail/MarketPlace business model and the many alleged predatory, discriminatory, and unfair standard Amazon business practices, that Amazon commits, not only in the grocery business segment, but in all other retail segments.
In stating “the parties expect to close the transaction in the second half of 2017,” that means Amazon expects no serious antitrust investigation of whether the transaction “substantially lessens competition,” and thus no “second request” from antitrust authorities requesting more information and questions to answer.
If a “second request” comes, which is likely, there is no way the companies can continue to “expect” the deal will be approved in 2017. That’s because such an investigative process effectively does not have any deadline for the reviewing authority, DOJ or the FTC, to either: approve, approved with conditions, or challenge the deal….
The combination of: the likely multiple alleged anticompetitive behaviors; the likely number of complaints and complainants; the online-offline complexity of investigating the complaints; the importance of this case as an online-offline antitrust merger precedent; the exceptional size, scope, reach, speed and non-transparency of Amazon’s online business; and the expected high-public profile of this transaction; all would auger for the reviewing authority to err on the side of caution and investigate the transaction fully.
Let me be clear here about what I am saying and not saying.
First, what’s obvious here is that the transaction will attract a lot of concern in private and publicly in multiple dimensions. That’s precisely because of the many serious implications this “Everything Store” proposed transaction will have for the future of competition in many markets, which in turn will delay Amazon’s transaction timetable.
…[M]ost of the antitrust concern will come with the exceptional market power that Amazon wields online, combined with the under-appreciated conflict in its business model where half of its retail revenues come directly from consumer-customers, and the other half of its retail revenues come from its MarketPlace offering where Amazon is the mall and gatekeeper for around 15 of its top 20 grocery competitor-customers, that have had to capitulate to Amazon’s market power and operate on Amazon Marketplace in order to reach all their offline customers online.
In layman’s terms, the problem Amazon’s retail intermediary model causes competitors is that it simultaneously is a direct retail competitor overall, at the same time it is the dominant online broker that has disintermediated its competitors from their customers when they are in the online world, and in that broker role, they are routinely criticized as not being an “honest broker” or as being a “non-neutral platform,” that routinely self-deals anti-competitively, because Amazon has market power to extract it with impunity, and no antitrust or regulatory accountability to speak of – to prevent it.
[T]his transaction review is the first genuine opportunity and powerful legal process for those alleging anti-competitive harm by Amazon to have antitrust authorities’ full ear in a confidential process where warranted.
[Editor Charlie sez–oopsie! Now there’s a safe harbor! Looks like Google didn’t “fix” their rev share deals with ISIS. Remember this one?]
Britain’s three main political parties pulled out of YouTube last night after The Times revealed that their campaign adverts were promoted next to videos of Islamic extremists.
The decision, taken less than 48 hours before the general election, came after the adverts were found playing before YouTube videos of hardline preachers such as Khaled al-Rashed, a Saudi cleric who appears to have called for Allah to “eliminate” non-Muslims.
Election adverts for Labour and the Lib Dems also ran on a YouTube channel created by a supporter of Islamic State. Tim Farron, the Liberal Democrat leader, was pictured above the supporter’s profile picture, an image of the terror group’s black flag.
YouTube removed the profile only when contacted by this newspaper.
While Spotify’s technocrats may be breathing a sigh of relief after the company’s most recent multimillion dollar settlement with songwriters, it is well to remember that the company is probably not anywhere close to out of the woods. As others have learned the hard way, once you replace the rights of songwriters and artists with your own lust for IPO riches, the lawsuits can go on for a very long time indeed. You would think that after nearly 20 years of massive infringement online, the obvious answer would suggest itself to the “get big fast” group: Don’t use music you don’t have rights to use.
Yes, that’s right. Just say no.
The typical reason given by interactive services about why their need to offer unlicensed music exceeds their desire to offer only licensed music is because of competitive pressure from YouTube. Why do they feel this competitive pressure? Because their investors tell them at every board meeting that they should feel it. But let’s be clear–I doubt that Tim Cook gets Eddie Cue in a headlock over the issue over at the Infinite Loop. If you agree, then that kind of narrows it down.
But entertain that idea for a moment, however ill founded. Why is YouTube able to sustain this competitive position that supposedly makes otherwise licensed services soil themselves with fear of being undercut and overrun by YouTube?
That’s right–the “DMCA license”, or YouTube’s absurd use of the “safe harbors” granted to them under the U.S. Copyright Act which YouTube likes to think makes them bullet proof. (Which is also what Cox Communications thought until they weren’t and is probably what Facebook thinks, too.)
So get that straight–some would say that The Golden Child (aka Spotify) is to be allowed to limp their way to the increasingly inexplicable goal of some kind of big financial reward (or “exit”) in an IPO of whatever stripe while we are all asked to look the other way and allow them the same shite arrangements that YouTube enforces through lobbying, litigation and unprecedented monopoly position (aka crony capitalism).
And you thought it was all about the “Value Gap”? Apparently not.
‘Patreon doesn’t solve every problem. But it’s well positioned to help boost better content online because it rewards creators’ ability to stir passion and interest among their audiences.’ (from Want a Better Web? Here’s an Idea: Pay for It)
Yeah, yeah, yeah, another brilliant paradigm that is going to save us from ourselves.
Once again, I am tempted to mix dry analysis with existential feeling because it is the easiest way to understand how we ended up in this mess.
Beauty of begging, sold to us as something romantic and newly brilliant: We are back to the Middle Ages where creative professionals–um, troubadours–were whores and marginalized individuals. Except now, between the troubadour and the generous peasants, there is a clever middleman who makes money on bulk.
And of course, said middleman says that it’s an actual business model. And fine. If the service were sold to us a financial tool getting a cut, and a financial tool only, it would be fair enough. But all the fuzzy language, all the treacherous branding, my God, I am going to come!
Canadian artist Miranda Mulholland articulated the common reality that we hear every day from artists around the world. Thankfully she gave her clear-eyed assessment of reality at the Economic Club of Canada–it would be great if we could get a comparable audience for artists around the world. Here’s an excerpt:
In 2014, a senior manager at Google Canada provided his opinion on this to Parliament’s Standing Committee on Canadian Heritage:
“The challenge is that the skills that are required to succeed have radically changed. Some are doing a better job at adapting than others because it’s just a completely different environment they’re operating in.”
Okay, thank you for the update on my challenges in the landscape that you created and perpetuate. So that leads me to this – a word that is very important to me.
Well, let’s look at the current situation and who is accountable for the devaluation to which we are forced to adapt. We now have 13 competing paid subscription streaming platforms in Canada, among them Spotify, Apple Music and Google Play, and over 400 legal digital services worldwide.
Picture each shiny new streaming platform as a shop window. Our content – at fire sale prices – fills their shop window, giving them credibility while creators of this content are asked to do the advertising. They give us – the creators – lists of “Best Practices” to get more of our hard-won fans to use their services. If we are not getting on playlists then it is our fault for not engaging with our fans enough. But in reality, it is becoming increasingly difficult for independent artists to land songs on their “curated playlists” in what is emerging as a 21st century version of payola.
The formula is much the same on the ad-based services. Except they price our work even lower!
Let’s look at the biggest music service in the world – YouTube. Did you know that 82% of YouTube users use it for music? It is supported by advertising and it is based on user uploaded content. But wait. Running a commercial site based on unauthorized uploading of copyrighted music is illegal, right?
YouTube says, it isn’t our fault – we are just the shop window. We didn’t put the items in the window, so we are not accountable for them. We are a passive intermediary. We are not liable for this massive copyright infringement.
But – once again – wait. A top brass at Google just bragged that “80% of all watch time is recommended by YouTube.” He explained that “Everybody thinks that all the music that’s being listened to and watched is by search.” But it isn’t, and in his words, “that’s a really important and powerful thing.”
This means that YouTube actively directs consumers. This doesn’t seem all that passive to me. Zero accountability.
And when asked about the problem of low payments to artists, a Google executive said:
“It’s important to note that on the concerns that have been flagged, there’s no consensus even amongst the artistic community about the impacts of streaming and what they actually think about it or what they don’t think about it. Every single time I hear a newspaper article about the reduction in royalty rates they’re getting from streaming, I’ll see another artist who basically says, “well, actually my royalty rates are pretty good”, and/or “to me it’s a really powerful discovery service, I’m actually making more money from X, Y, and Z”.
Well here’s a consensus. Your rates are the lowest in the world! Your revenue is built on the backs of other people’s talent and work and you refuse to acknowledge it.
Read the fine print: “Of the 1,007,741,143 takedown requests received, 908,237,861 were removed from search results.” So Google did not remove 99,503,282 infringing links.
I wonder how much traffic Google derives from a billion takedowns? Or the 99,503,282 they don’t take down? This is how Google messages their pathetic record on piracy…”but we took down 90%!” Don’t be deceived by Google duplicity.
As the biggest provider of search results on the Internet, Google receives a constant barrage of requests to remove content from its results. Some of those requests come from governments, but the majority are submitted by copyright owners very keen to stop their work from being pirated.