Late last month, Mark Zuckerberg wrote a brief post on Facebook at the conclusion of Yom Kippur, asking his friends for forgiveness not just for his personal failures but also for his professional ones, especially “the ways my work was used to divide people rather than bring us together.” He was heeding the call of the Jewish Day of Atonement to take stock of the year just passed as he pledged that he would “work to do better.”
Such a somber, self-critical statement hasn’t been typical for the usually sunny Mr. Zuckerberg, who once exhorted his employees at Facebook to “move fast and break things.” In the past, why would Mr. Zuckerberg, or any of his peers, have felt the need to atone for what they did at the office? For making incredibly cool sites that seamlessly connect billions of people to their friends as well as to a global storehouse of knowledge?
Lately, however, the sins of Silicon Valley-led disruption have become impossible to ignore.
Facebook has endured a drip, drip of revelations concerning Russian operatives who used its platform to influence the 2016 presidential election by stirring up racist anger. Google had a similar role in carrying targeted, inflammatory messages during the election, and this summer, it appeared to play the heavy when an important liberal think tank, New America, cut ties with a prominent scholar who is critical of the power of digital monopolies. Some within the organization questioned whether he was dismissed to appease Google and its executive chairman, Eric Schmidt, both longstanding donors, though New America’s executive president and a Google representative denied a connection.
Meanwhile, Amazon, with its purchase of the Whole Foods supermarket chain and the construction of brick-and-mortar stores, pursues the breathtakingly lucrative strategy of parlaying a monopoly position online into an offline one, too.
Now that Google, Facebook, Amazon have become world dominators, the question of the hour is, can the public be convinced to see Silicon Valley as the wrecking ball that it is?
These menacing turns of events have been quite bewildering to the public, running counter to everything Silicon Valley had preached about itself.
Spotify’s counsel Christopher Sprigman recently made the argument in Bluewater Music Services v. Spotify that the service isn’t required to pay mechanical royalties to songwriters because they aren’t really making copies except for those covered by “fair use” and “ephemeral” exceptions. This extremely aggressive argument seems to many (but not all*) music publishing experts to be dubious and more than a little “piratey.”
IMHO this is because piracy is in the DNA of Spotify. First Spotify CEO Daniel Ek made his first millions as founder of torrenting client uTorrent. Second, one of Spotify’s early investors Sean Parker of Napster fame declared “Spotify would finish what Napster started.” Third, until 2014 Spotify in the US operated as a peer to peer service copying and distributing millions of files using the devices of their customers (and BTW this completely undermines Sprigman’s copy argument).
Now there is this from Torrent Freak:
“Spotify Threatened Researchers Who Revealed ‘Pirate’ History”
It is very likely that we will hear about a move to make significant amendments to the Copyright Act at some point before the beginning of campaign season in 2018. There are a high number of copyright-related bills that have been introduced in the House of Representatives in the current session, so brace yourself for an “omnibus” copyright bill that would try to cobble them all together Frankenstein-style.
A Frankenstein omnibus bill would be a very bad idea in my view and will inevitably lead to horse trading of fake issues against a false deadline. Omnibus bills are a bad idea for songwriters and artists, particularly independent songwriters and artists, because omnibus bills tend to bring together Corporate America in attack formation.
[Editor Charlie sez: Mr. Ek, meet Commissioner Vestager….we’ve been hearing this from the “quiet angel” for a while now.]
While competition online starts the same way as that in offline markets, my research shows it often settles very differently online.
Both have seen lots of competitors emerge in a new area underpinned by new technologies. But online, consolidation ends in a high-stakes winner-takes-most “title fight” between the two strongest players.
In search this was AltaVista vs Google, in social media it was MySpace vs Facebook and in business networking Spoke vs LinkedIn. The result is that the victor at this critical juncture goes on to dominate their corner of the market and becomes almost unassailable in that space.
The evidence is mounting that Swedish music streaming company Spotify is on the verge of seizing the crown in music.
Pandora has been for some time the dominant real-time streaming service in the United States. Three years ago it had a clear lead but competition from Spotify appears to be stronger than ever. Pandora was a mass market pioneer in the online “radio” style streaming format where users pick stations and the music is compiled for them, whereas Spotify adopted an on-demand model which has prevailed.
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.
Well… this is awkward.
Last summer, MBW ran a widely-read story which blew the lid off the fact that Spotify’s platform was being deliberately clogged up with music by ‘fake’ artists.
We were told that Daniel Ek’s company was encouraging and even paying producers to create tracks under untraceable pseudonyms – within specific musical guidelines – which were then being drafted into key first-party playlists.
After some consideration, Spotify declined to comment.
On Friday (July 7), nearly a year after our article appeared, Spotify issued a fierce denial of such accusations.
“We pay royalties -sound and publishing – for all tracks on Spotify, and for everything we playlist.
“We do not own rights, we’re not a label, all our music is licensed from rights-holders and we pay them – we don’t pay ourselves.”
What’s essential to remember here: amongst Spotify’s indignant yet carefully-worded statement, you might have missed the bit where they deny that their service is littered with fake artists.
That’s because they can’t.
Spotify just can’t seem to catch a break in the artist community. A story broke on Vulture evidently based on a Music Business Worldwide post alleging (and I’m paraphrasing) that (1) Spotify commissions artists to cover hits of the day and (2) there’s a lot of sketchy material on Spotify that trades on confusing misspellings, “tributes” and other ways of tricking users into listening to at least 30 seconds of a recording. Which means that Spotify isn’t that different than the rest of the Internet.
Spotify of course has issued a denial that I find to be Nixonian in its parsing….