[Editor Charlie sez: royalty deadbeat Facebook is making friends all over.]
When Facebook Inc. wants to try something new, one of its first calls is to CNN. It was a key partner when Facebook introduced its news-reading app, Paper, in 2014. When the social network shuttered Paper soon after, transmogrifying it into a series of fast-loading News Feed stories called Instant Articles, CNN remained on board. And last year, when Facebook began focusing on hosting live video, CNN was one of the few parties to which it paid a nominal fee to produce clips of, say, election results being projected on the Empire State Building.
But strain is showing in the relationship. Facebook’s latest pitch to publishers such as CNN is for them to provide a regular stream of TV-quality, edited, original videos that will give Mark Zuckerberg’s company a chance to compete with YouTube to siphon some of the $70 billion pouring into TV ads each year. In exchange, the publishers can share some of the revenue for ads that roll in the middle of the videos. Facebook will control all the ad sales.
It’s getting tougher for CNN and others to view these arrangements as mutually beneficial. “Facebook is about Facebook,” says Andrew Morse, general manager of CNN’s digital operations. “For them, these are experiments, but for the media companies looking to partner with significant commitments, it gets to be a bit of whiplash.” Morse says the financial compensation Facebook offers isn’t enough to convince him that working directly with the social network will be worthwhile in the long term.
Jason Kint, chief executive officer of the industry trade group Digital Content Next, was more blunt. “Media companies are like serfs working Facebook’s land,” he says. [Editor Charlie sez, “Aren’t we all?”]
Read the post on Bloomberg
The European Union imposed a 2.4 billion euro ($2.7 billion) fine on Google last Tuesday for manipulating its search engine results to favor its own comparison shopping service. It is just the latest institution to recognize the increasing monopolization of the technology industry.
Google has about a 90 percent market share in searches, while Facebook has a penetration of about 89 percent of internet users. Economists have a fancy name for this phenomenon: “network externalities.” In traditional product markets, one customer’s choice (for example, a particular car tire) does not directly affect other individuals’ preferences for that product, and competition generally ensures that consumers enjoy the best products at the lowest possible price.
In the market for social media, by contrast, when one customer uses Facebook over Myspace, it has a direct (and positive) impact on other customers’ preferences for the same social network: I want to be in the social network where my friends are. These markets naturally tend toward a monopoly.
Read the post on the NY Times
[Editor Charlie sez: Insightful must-read artist rights interview with Mike Huppe, the CEO of SoundExchange.]
During the following interview, held at the Omni Hotel in Nashville, we covered a variety of topics such as what Huppe calls the AM/FM Artist Loophole, the DMCA Safe “Ocean,” internet enabled auto dashboards and the organization’s new ISRC online searchable database. Read On…
NEKST: Do you expect SoundExchange’s distribution growth will continue?
Mike Huppe: We’ve had unbelievable double digit growth for the past 7 or 8 years which won’t continue forever, but we are on track to have another up year in 2016. We paid out about $803 million last year and should be in the mid-$800s this year. It will naturally level out as we get bigger and the market matures.
Read the post on Nekst.biz
After reading Ari Herstand’s tirade against Universal Music Publishing Group (and other rights owners by association) several thoughts came to mind. In fact, many of those same thoughts have been voiced by several others in the comment threads following that article.
While Ari is typically a great advocate for artists, he has this one wrong and just plain backwards.
Read the post on Digital Music News.
Two vastly wealthy multinational media companies are exploiting a copyright law loophole to sell the world’s music without paying royalties to the world’s songwriters. Why? Because Google and Amazon–purveyors of Big Data–claim they “can’t” find contact information for song owners in a Google search. So these two companies are exploiting songs without paying royalties by […]
via Google and Amazon Leverage Copyright Loophole to Use Songs Without Paying Songwriters — MUSIC • TECHNOLOGY • POLICY
But Facebook is unlicensed and uses the “compulsory DMCA license”….
Within the past few weeks, the social network has quietly initiated talks with music labels about licensing a limited amount of songs that users can upload to, say, summer vacation videos or birthday parties, sources said.
The idea, if it comes to fruition, would be a way to keep music labels happy at a time when they’re frustrated about the volume of unlicensed user-generated content at YouTube.
Facebook late Sunday confirmed it was testing a new product, called Slideshow, that includes music from Warner Music Group to help users create “soundtrack options.”
“We are always testing ways to help people better share their stories with friends,” a spokesperson for the Menlo Park company said in a statement. “Slideshows are a new way for people to share photos and videos in a creative and succinct way. To date, we’ve been using Facebook-owned music to accompany these slideshows, we will now be testing the use of a limited amount of music from Warner Music Group as soundtrack options.”
Facebook’s music offensive, aimed at keeping user-generated content inside its walls, emerges just days after Jeff Bezos’ Amazon announced it would launch Prime Video Service as a new hub for amateur and professional videos of all kinds.
To be sure, Facebook’s efforts in the music space have been limited — and YouTube’s head start and entrenched leadership position put in question just how many eyeballs any rival can steal away from the mega-popular video-streaming brand.
While Facebook once held talks about a possible acquisition of music industry-owned Vevo, it hasn’t made great strides in the revenue-rich video arena.
Read more on NY Post.