The Time to Hesitate is Through: Amazon’s Thievery Requires Decisive Action

Emmanuel Legrand reports in his excellent newsletter that:

Music industry trade group the Recording Industry Association of America (RIAA) has asked the US government for tougher measures against infringers, in particular in the online marketplace. The proposal was part of a submission to the US Department of Commerce, as part of its request for comments on the state of the state of counterfeit and pirated goods.

You can read the RIAA’s submission here.

Counterfeiting and pirating of physical music products facilitated by online platforms continues to cause harm to our members. In 2019, we conducted two studies to identify the amount of counterfeit offerings of music CDs on popular online platforms, including a study on the prevalence of high quality counterfeit box sets on certain platforms and a study on the prevalence of high quality counterfeits for a broad sample of current and evergreen album titles released by the major U.S. record labels. As further discussed below, each of these studies showed significant counterfeit activity on the noted online platforms, including findings that:

  • A recent sample purchase program found 100% of new high quality box sets offered for sale through eBay or AliExpress in the U.S. were counterfeit; and
  • A recent sample purchase program found 11% of new CDs offered for sale on Amazon were counterfeit, and 16% of new CDs sold on eBay were counterfeit.

    For the study on box sets of music, we identified and made test buys on eBay and AliExpress’s U.S. platforms of 10 well known artist box set titles released by major U.S record labels. Each purchase was made after a search for “brand new” box sets of the titles selected, and a purchase of the 4 lowest priced box sets on each platform, without regard to seller location. We then examined the products that were shipped to us. On both eBay and AliExpress, 100% of the test buys of the box sets were counterfeit. This is of particular concern as box sets are premium physical music products designed for the superfan that often contain the most significant sound recordings in an artist’s repertoire.

The conclusion is:

Trafficking of counterfeit and pirated goods, whether in the form of physical CDs, box sets or artist merchandise, as well as online infringement of music and music videos in digital form, continues to significantly impact the music industry. We believe more can be done, including implementation of voluntary measures as well as governmental action, to deter and reduce such activity, and create a healthier online ecosystem where all can thrive.

Amazon apparently was the only one of the bootleggers who responded, and did so with the usual non answer and deflection:

Our customers expect that when they make a purchase through Amazon’s store—either directly from Amazon or from one of its millions of third-party sellers—they will receive authentic products. Amazon strictly prohibits the sale of counterfeit products and we invest heavily in both funds and company energy to ensure our policy is followed. We work with and empower brands through programs like Brand Registry, Transparency, and Project Zero to ensure only authentic products are sold in our stores. We investigate any claim of counterfeit thoroughly, including removing the item, permanently removing the bad actor, pursuing legal action or working with law enforcement as appropriate.

Sound familiar?  Kind of like how YouTube responds to the community flagging?  Investigating after the illegal goods are being sold is not the point.  Getting caught is not the point.  The point is stopping the illegal goods from getting onto the platform in the first place.

The reason this drivel from Amazon sounds like tired crap is because it is tired crap.  And crystalizes that they think the problem is getting caught and that what they really want is to keep getting away with it.

And this is where I disagree a bit with RIAA–the time for voluntary measures has passed.  Someone needs to go to jail–someone high up who almost invariably knew what was going on (for example, grand jury documents told the U.S. Attorney for Rhode Island “Larry Page knew what was going on“).

Then we can talk again about voluntary measures to keep their butts out of the slammer–not their pathetic little “Project Zero.”  I got your project zero right here.

Remember the great continuum that has driven homo sapiens for millennia:

FEAR <———> GREED

We need Jeff Bezos closer to the FEAR end than the GREED end.

Remember that data is the new exposure, streaming is the new physical and that both these tropes have something in common–artists are being driven to substitute away from low to no margin streaming and away from sustainable margins on physical like CDs with no revenue replacement.  (Unless you’re in the 5% of tracks that account for 90% of streaming revenue in the hyper efficient market share distribution of streaming revenue.)

Against that background, we find that the online platforms like eBay, Alibaba and Amazon are going even further toward evil and doing little or nothing in their rush to drive physical retail out of business to stop the sale of counterfeit CDs delivered to your door by Amazon Prime or Ali-express.  And most honest business folk would probably think they are pretty shameless about it and ask how could they get away with sucking up the revenue from counterfeits into their maelstrom of cash?

But before you go down that rabbit hole, you need to understand an important fact about the mind set of Silicon Valley–and it’s the same mindset that gave us both Google and Theranos.  It’s not that they made a choice to do evil.  It’s that they don’t understand there is a choice about doing evil.  It’s how these little soulless people sit in front of Congress and lie and feel good about themselves.  The Internet is their Ring of Gyges and they are unconcerned about justice because their thing is getting away with it, not getting caught and getting richer than Croesus.

russia_medvedev_facebook_zuck

Somewhere in their development they lacked the normative guide–or “sherpa” in their case–that should have developed a self-governing code to map their behavior.  Parents, pastors, priests, rabbis, teachers, all failed to make a dent.  These are the kind of people who don’t stop when the European Commission fines them billions.  They don’t care how they treat their employees as long as they’re the richest man in the world.  They don’t care about ripping off artists.  Their reaction to getting caught is not fixing the problem, their reaction is to buy the shillery and try to make us look greedy for expecting them to behave.

If a $5 billion fine didn’t work, how about $50 billion?  Let’s try that.  But even in the Silicon Valley dual class system, the corporate royalty might start thinking about offering up an executive to save the company.

This is why the solution probably isn’t voluntary.  It probably has a lot more zeros on it than any normal person  would think reasonable, or is a court order for very specific behavior, or simply prison.

 

 

@rachelrwithers: Amazon Owes Wikipedia Big-Time

is-wikipedia-a-reliable-source-of-information

When you ask Amazon’s Alexa, “What is Wikipedia?” it’ll tell you this: “Wikipedia is a multilingual, web-based, free encyclopedia based on a model of openly editable content.” Alexa took this line directly from Wikipedia’s entry on Wikipedia, as it does with many of its answers. Perhaps what it should have said was this: “Wikipedia is the source from which I take much of my information, without credit, contribution, or compensation.”

That’s about to change. Or is it? Amazon recently donated $1 million to the Wikimedia Endowment, a fund that keeps Wikipedia running, as “part of Amazon’s and CEO Jeff Bezos’ growing work in philanthropy,” according to CNET. It’s being framed as a “gift,” one that—as Amazonputs it—recognizes their shared vision to “make it easier to share knowledge globally.” Amazon also noted the ability for users to easily donate to Wikimedia through the Alexa Donations feature, with the voice command “Alexa, donate to Wikipedia.”…

But it’s not just the fact that this donation is, in the scheme of things, paltry. It’s that this “endowment” is dwarfed by what Amazon and its ilk get out of Wikipedia—figuratively and literally.

Read the post on Slate.

YouTube/Amazon Fight: Tone Deaf Google acts like it’s their videos

Your margin is my opportunity.  Now bend over.

Inspired by Jeff Bezos

If a record company pulled your music from a retailer because of a commercial dispute that had nothing to do with you or the label itself, how would that make you feel?  If you ran to your contract to see if you could stop them, do you think anyone would have ever thought to negotiate protection against anything so philistine? This little life parable shows you why you should never underestimate the highly innovative monopolists forcing their way into our lives.

According to Bloomberg:

Alphabet Inc.’s Google pulled support for its YouTube video service from Amazon.com Inc.’s streaming-media devices, citing the internet retailer’s failure to make Amazon Prime Video available through Google’s gadgets and the recent halt of the sale of some Nest products on its website.

What’s interesting about YouTube’s behavior is that you would think that YouTube actually owned the videos on YouTube.  Which in probably 99% of the cases, they do not.  (It’s unclear if the Amazon boycott includes Vevo, the premium content provider co-owned by Google, but I would assume it does.)  I’m no fan of Amazon, God knows, so I’m not suggesting that YouTube’s move here is hard on Little Jeffie, the destroyer of worlds.

I’m suggesting that it is hard on artists and is not something that any other distributor would think they could get away with.  And the fact that YouTube exists to screw artists and songwriters doesn’t excuse YouTube’s tone deaf wielding of other people’s property to gain a commercial advantage against Amazon accruing almost entirely to Google.  So what did Google do, exactly?  Bloomberg tells us:

Google blocked YouTube access via the Echo Show, Amazon’s smart speaker with a touchscreen, on Tuesday and will stop supporting YouTube on Amazon’s Fire TV set-top box on Jan. 1. In a statement, a Google representative said it’s taking the action because the YouTube apps on Amazon products aren’t made by Google, like the YouTube app on the iPhone is, and the retail giant doesn’t sell some Google products, such as Chromecast and Google Home.

“We’ve been trying to reach agreement with Amazon to give consumers access to each other’s products and services,” Google said in a statement. In its own statement, Seattle-based Amazon said its gadgets now send users to the YouTube website, and the company hopes to resolve the dispute as soon as possible.

In other words, Amazon stopped carrying totally unrelated Google products and Google responded by blocking your videos from Amazon devices.  Did anyone ask you if that was OK?  According to the Verge:

Three months ago, YouTube pulled its programming from Amazon’s Echo Show device — the first skirmish in what is apparently an ongoing war. Shortly after, Amazon stopped selling the Nest E Thermostat, Nest’s Camera IQ, and the Nest Secure alarm system. Two weeks ago, Amazon got YouTube back on the Echo Show by simply directing users to the web version, a workaround that left a lot to be desired. But even that version won’t be available after today.

In other words, this boycott of the billionaires has nothing to do with any YouTube artist or Vevo artist, but all are being harmed by it for reasons they have no control over.  You might, however, be able to file a complaint with the Federal Trade Commission against Google and possibly both Google and Amazon by clicking here.

@AlanWolf_TWICE: Let’s Get Physical: Amazon and Google embrace brick-and-mortar

Wasn’t too long ago that pundits predicted the end of physical storefronts.

Now, in an ironic twist, the very forces of digital commerce that were supposed to do in brick-and-mortar have become hot for commercial real estate.

Two of the biggest proponents are smart-home contenders Amazon and Google. The e-tailer has opened bookstores, pop-up shops and in-store Kohl’s sections across the country, while the search engine giant is plying its proprietary Home products via temporary holiday stores in New York and Los Angeles.

TWICE visited two of these physical manifestations, which provide further proof that the corner store is here to stay.

Read the post on TWICE

@scleland: Why Amazon Buying WholeFoods Will Attract Serious Antitrust Scrutiny

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 statingthe 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.

Read the post on the Precursor Blog

@plagiarismtoday: Amazon Has a Serious Copyright Problem

Every web host and service provider online has some sort of copyright problem. Whether it’s YouTube’s battles with Content ID, Twitter being accused of not removing infringing materials or just hosts like GoDaddy and Hostgator dealing with run-of-the-mill copyright notices, the problem is always there.

However, Amazon’s problem may trump them all.

Amazon may want to be the world’s marketplace but it’s failing to ensure that it’s creators, not scammers and infringers, who are being rewarded. Unfortunately, unless Amazon can fix that, it’s going to be a cancer eating away at Amazon’s soul and its bottom line.

Read the full post on Plagiarism Today.