This week PRS for Music’s chief economist Will Page released a co-authored paper suggesting some approaches for tackling online piracy which are radically different from those currently proposed by the Digital Economy Act. The paper is complex but we think it’s fair to summarise its main message is thus: “Rather than targeting individual file-sharers and seeking to punish them, instead let’s look at ways in which we can monetise illegal music use at the ISP level.”
It was little surprise that most media outlets ran with the paper’s most juicy suggestion that a levy could be charged on ISPs for the amount of illegal media use on their networks. This proposal takes its cue from the existing requirement of the new Digital Economy Act that illegal activity will be monitored and measured at the ISP level, then presented to Ofcom and the Secretary of State on a quarterly basis. ISPs, Page and Touve set out, could therefore be charged for that illegal use, with charges dropping if they found ways to tackle and reduce the piracy measured on their networks. Less prominently reported was the paper’s other suggestion that ISPs could be brought into the fold via compulsory licensing, as has been the case in South Korea. All internet users would make payments for their music use to their internet provider, with the accumulated pot of money being distributed to rights holders according to the traffic which is measured.
There are some interesting suggestions in this paper. We’re always in favour of market-based solutions to tackling piracy. But are these genuinely market-based? They rely after all on the legislation of the Digital Economy Act, yet they suggest a totally different use of that legislation than that which has been proposed. If PRS for Music envisaged a radically different solution to piracy than that which was contained within the Digital Economy Bill, why is it proposing it now after the Bill has become legislation? Another problem with these suggestions is that they would seem to require additional legislation in order to be implemented. So are they not therefore being voiced rather too late? Is there a subtext which says that PRS for Music is deeply unhappy with the DEA as it currently stands?
We found the timing of this paper strange. Less than a week after BT and Talk Talk launched a legal bid to challenge the Digital Economy Act, PRS for Music launches a paper which suggests placing an even greater burden on ISPs than the measures they currently object to. We wonder how this could cause anything other than greater friction between ISPs and rights holders? Meanwhile, some tech commentators have reacted quite negatively to this report. One key argument raised against an ISP levy is that it could end up punishing those ISP customers who don’t engage in piracy. Others question whether ISP-based monitoring of internet traffic can ever be accurate enough to form the foundation of a levy-type ‘punishment’ model.
From our perspective, we have to wonder what exactly PRS for Music was trying to achieve with this report. We’re all in favour of discussion and debate but if this was a simple think piece, it seems to have had a much deeper impact than intended. To us it reads rather as a sideways condemnation of the Digital Economy Act. And we wonder, if it is no more than a discussion piece, why was it so prominently-branded by PRS for Music and actively promoted to media? PRS for Music is one of the main funders of lobbying organisation UK Music, but seems to be engaged in separate lobbying which doesn’t necessarily fit neatly alongside it. Regardless of the quality of the research or suggestions in the report, its manner of release was in our view poorly-timed and potentially damaging to the wider industry, a great shame when we’re sure that the intention was to create a positive impression.
Friday, July 16, 2010
Monday, July 12, 2010
Google talk music at BPI AGM
This year’s BPI AGM was remarkable for an enlightening and challenging keynote speech from Google’s president of global sales operations and business development Nikesh Arora. Respect is due to the BPI for securing a keynote speaker who was so eagerly awaited and who produced so many talking points.
Arora cut a considerable swagger at the BPI AGM, presenting via radio mic in typically-informal tech style. He started off in friendly terms, describing some excellent heckling he’d heard whilst sitting at the back of the auditorium. He soon made it pretty clear however that he was appearing to tell the music industry how things are, not the other way around. He’d already made this apparent when a few days before the AGM he tweeted "Going to talk to the British music industry this week. Thoughts from all of you on what to enlighten them about?"
It’s hard not to feel hostile when confronted by such comments from a representative of a company which arguably does no more than the law insists on when it comes to protecting and respecting copyright. Nevertheless, Arora had plenty of interesting things to say. He noted that pretty much the entire population of the developed world is now connected to the internet and that the reshaping of industries by the internet in a revolution which will only increase its effect. Devices are now driving change, he said, not only giving us always-on connection, but also acting as tools of production. Technology is empowering consumers to destroy the bundles traditionally served by media – be that albums, newspapers or TV subscriptions. What entertainment companies should be doing and aren’t so good at, is to respect the consumer’s desire to create their own bundles and service that. “Why can’t I buy my friend’s playlist on iTunes or Amazon in the same way that I could buy an album? We have to get out of that mode of thinking,” he said.
Arora provided some staggering stats. 16 times more data was created in 2009 than in all time up to 2005. “The amount of digital content is phenomenal”. Technology performance is crucial to business success, he argued, noting that when Amazon serer issues cost 100 milliseconds in reduced speed, the company saw a 1% decline in its revenues. People expect instant gratification, he said and we’d better provide it if we want to say in business.
One of Arora’s key points for the music industry was that it needs to reconsider a licensing model which he sees as antiquated. “With technology national borders mean less and less.” When pressed to provide a timeline for the launch of a Google music service he said “designing the service is not the hard part of launching a music service. Navigating the copyrights is extremely complex and getting global rights to a piece of content is a nightmare”. He urged music companies to simplify the model.
It was no surprise that all delegates were keen to hear Arora’s thoughts on piracy. It is beyond doubt that Google’s search engine is a facilitator of piracy. That’s not to say that the company itself can be deemed responsible for that piracy, as the recent Viacom court ruling showed. But equally it can’t (and admittedly doesn’t) claim not to be involved at all. Arora’s responses on the subject were what we’d describe as slippery, both acknowledging and avoiding hard questions. “I understand the passion about blocking piracy”, he said, before underlining that it’s not Google’s responsibility to stop it. “We believe content has value and without it we can’t be in the search business,” he said. What Arora would not give, even when specifically pressed by RotD, was any indication of Google’s moral and political stance on online piracy. Instead he sought to underline that the company was doing everything required by the law to comply with anti-piracy legislation and to act quickly on takedown notices as well as looking to improve how quickly it processes these. He threw the ball back to the industry, calling for “compelling ways” to access content and collaboration with Google to find “new processes and ways to deal with it”. What he did promise – and we believe this is a truly significant and encouraging promise – was that Google would work with the music industry as it has with other sectors to find ways to ensure that legal content gets ranked higher in search results. Considering the fact that currently it’s very often illegal content that ranks highest on Google, such a development could be hugely beneficial for music companies. It might not be a clear ant-piracy policy, but it’s an initiative that is well worth the industry collaborating with Google to achieve.
What were Google’s main messages to the industry? At risk of oversimplifying, we’d say they were: “sort your licensing out”, “improve your legal services”, “empower the customer’s desire to create their own products and don’t dictate products to them”, plus “don’t look to us to provide your silver bullet in the fight against piracy”. Some of this sounds quite reasonable. We do feel however, that if other companies have managed to deal with an admittedly complex licensing framework, why can’t Google? Is it instead evidence of a company that is seeking to backward engineer copyright legislation using the stick of its enormous market influence and the cherry of promising to provide hugely mass market legal music services? Online licensing does undoubtedly need to be simplified however, and the industry would do well to place significant emphasis on working towards this admittedly distant hard-to-achieve goal.
We’re still not convinced by Google’s claims of respect for copyright but what really counts is future progress on this issue. We wouldn’t be at all surprised if there aren’t yet more legal challenges to Google’s position on piracy, perhaps under UK law. Nevertheless, if Google does make good on its promise to promote legal music services over illegal ones, this is to be welcomed as nothing less than a massive step forward. As ever caution is required. The music industry must work with Google and try to understand its position – it is probably now the single most important gatekeeper of our content. On the other hand, we can’t afford to roll over and give up the value of our copyrights when confronted by such an impressively powerful beast. What we do have as our ace is amazing content that real people want. Surely that’s a strong enough basis to form a collaborative future relationship with Google?
Arora cut a considerable swagger at the BPI AGM, presenting via radio mic in typically-informal tech style. He started off in friendly terms, describing some excellent heckling he’d heard whilst sitting at the back of the auditorium. He soon made it pretty clear however that he was appearing to tell the music industry how things are, not the other way around. He’d already made this apparent when a few days before the AGM he tweeted "Going to talk to the British music industry this week. Thoughts from all of you on what to enlighten them about?"
It’s hard not to feel hostile when confronted by such comments from a representative of a company which arguably does no more than the law insists on when it comes to protecting and respecting copyright. Nevertheless, Arora had plenty of interesting things to say. He noted that pretty much the entire population of the developed world is now connected to the internet and that the reshaping of industries by the internet in a revolution which will only increase its effect. Devices are now driving change, he said, not only giving us always-on connection, but also acting as tools of production. Technology is empowering consumers to destroy the bundles traditionally served by media – be that albums, newspapers or TV subscriptions. What entertainment companies should be doing and aren’t so good at, is to respect the consumer’s desire to create their own bundles and service that. “Why can’t I buy my friend’s playlist on iTunes or Amazon in the same way that I could buy an album? We have to get out of that mode of thinking,” he said.
Arora provided some staggering stats. 16 times more data was created in 2009 than in all time up to 2005. “The amount of digital content is phenomenal”. Technology performance is crucial to business success, he argued, noting that when Amazon serer issues cost 100 milliseconds in reduced speed, the company saw a 1% decline in its revenues. People expect instant gratification, he said and we’d better provide it if we want to say in business.
One of Arora’s key points for the music industry was that it needs to reconsider a licensing model which he sees as antiquated. “With technology national borders mean less and less.” When pressed to provide a timeline for the launch of a Google music service he said “designing the service is not the hard part of launching a music service. Navigating the copyrights is extremely complex and getting global rights to a piece of content is a nightmare”. He urged music companies to simplify the model.
It was no surprise that all delegates were keen to hear Arora’s thoughts on piracy. It is beyond doubt that Google’s search engine is a facilitator of piracy. That’s not to say that the company itself can be deemed responsible for that piracy, as the recent Viacom court ruling showed. But equally it can’t (and admittedly doesn’t) claim not to be involved at all. Arora’s responses on the subject were what we’d describe as slippery, both acknowledging and avoiding hard questions. “I understand the passion about blocking piracy”, he said, before underlining that it’s not Google’s responsibility to stop it. “We believe content has value and without it we can’t be in the search business,” he said. What Arora would not give, even when specifically pressed by RotD, was any indication of Google’s moral and political stance on online piracy. Instead he sought to underline that the company was doing everything required by the law to comply with anti-piracy legislation and to act quickly on takedown notices as well as looking to improve how quickly it processes these. He threw the ball back to the industry, calling for “compelling ways” to access content and collaboration with Google to find “new processes and ways to deal with it”. What he did promise – and we believe this is a truly significant and encouraging promise – was that Google would work with the music industry as it has with other sectors to find ways to ensure that legal content gets ranked higher in search results. Considering the fact that currently it’s very often illegal content that ranks highest on Google, such a development could be hugely beneficial for music companies. It might not be a clear ant-piracy policy, but it’s an initiative that is well worth the industry collaborating with Google to achieve.
What were Google’s main messages to the industry? At risk of oversimplifying, we’d say they were: “sort your licensing out”, “improve your legal services”, “empower the customer’s desire to create their own products and don’t dictate products to them”, plus “don’t look to us to provide your silver bullet in the fight against piracy”. Some of this sounds quite reasonable. We do feel however, that if other companies have managed to deal with an admittedly complex licensing framework, why can’t Google? Is it instead evidence of a company that is seeking to backward engineer copyright legislation using the stick of its enormous market influence and the cherry of promising to provide hugely mass market legal music services? Online licensing does undoubtedly need to be simplified however, and the industry would do well to place significant emphasis on working towards this admittedly distant hard-to-achieve goal.
We’re still not convinced by Google’s claims of respect for copyright but what really counts is future progress on this issue. We wouldn’t be at all surprised if there aren’t yet more legal challenges to Google’s position on piracy, perhaps under UK law. Nevertheless, if Google does make good on its promise to promote legal music services over illegal ones, this is to be welcomed as nothing less than a massive step forward. As ever caution is required. The music industry must work with Google and try to understand its position – it is probably now the single most important gatekeeper of our content. On the other hand, we can’t afford to roll over and give up the value of our copyrights when confronted by such an impressively powerful beast. What we do have as our ace is amazing content that real people want. Surely that’s a strong enough basis to form a collaborative future relationship with Google?
Google scores landmark court victory over Viacom
Large corporations can now show blatant disrespect for copyright and get away with it. That seems to be the message coming from the Southern District Court of New York, which this week delivered a defeat to Viacom in its long-running litigation with Google/YouTube. Viacom had alleged that YouTube built the value and user base of its business based on copyrighted works used without permission, and that YouTube consistently and deliberately dragged its heels when it came to removing infringing material. Google claimed that it acted absolutely within the conditions of the US Digital Millennium Copyright Act (DMCA), following all guidelines for dealing with piracy on its service.
Like any court judgement, this one is based on certain specific questions. The court’s key finding was that Google had acted within the rules of the DCMA and as such, could not be found liable for copyright claims on its service. The ruling accepted of Google’s claim that it always complied with specific and correctly-delivered takedown notices but could not be held generally responsible for identifying and removing pirated material from its site. The court also – rather surprisingly to our mind - accepted Google’s claim that it did not receive a financial benefit from the use of pirated material.
This ruling seems to fly in the sense of common sense. Does the court really believe that YouTube gained the $1.65bn value which Google paid for it based solely on user-uploaded videos of dogs chasing their tales? And that the company has never derived financial benefit from illicit clips of music, TV, sport? The main problem here is that the DMCA seems to be open to some interpretation and has provided protection to a business that in our view profited from the misuse of others’ copyrights, whilst providing no protection to the wronged copyright holders.
This week we learnt that the BPI has submitted new copyright infringement claims to Google, where it identified not just specific URLs for infringing material, but also entire website URLs such as http://megaupload.com/ and http://mediafire.com/. Interestingly this story broke before news of the ruling in the Viacom case. But clearly the BPI had an inkling that the DCMA was going to be found lacking in terms of providing enough protection. These new infringement claims open two new possible avenues: one being that Google might in future be found liable for piracy for linking to entire infringing sites, not just specific links. Indeed the IFPI has now also written to Google with similar claims, asking it to remove links to The Pirate Bay.
What these claims also prepare the way for is a possible action fought not under the US law, but the new, untested UK Digital Economy Act.
We’re nervous of any anti-piracy moves which seek to criminalise or punish individuals whose piracy is insignificant on an economic scale. But we don’t feel the same way about companies which at the very least display a corporate ambivalence to piracy on a massive scale, but might even be accused of being engaged in a strategy to profit from piracy. We absolutely agree that the BPI and IFPI should make unerring and determined efforts to ensure that Google treats copyright with more respect, and that specifically it must stop providing easy linking access to infringing material.
What’s really bizarre about all this is that Google is apparently planning to launch its own legal music services. A company which appears to show blatant disregard for music copyright also wants to become a legitimate player. Isn’t it time that Google decides where it stands on online copyright infringement? The legislation may allow room for manoeuvre, but the general issue is actually quite simple. Either Google is committed to fighting piracy, or it turns a blind eye. So which is it?
Like any court judgement, this one is based on certain specific questions. The court’s key finding was that Google had acted within the rules of the DCMA and as such, could not be found liable for copyright claims on its service. The ruling accepted of Google’s claim that it always complied with specific and correctly-delivered takedown notices but could not be held generally responsible for identifying and removing pirated material from its site. The court also – rather surprisingly to our mind - accepted Google’s claim that it did not receive a financial benefit from the use of pirated material.
This ruling seems to fly in the sense of common sense. Does the court really believe that YouTube gained the $1.65bn value which Google paid for it based solely on user-uploaded videos of dogs chasing their tales? And that the company has never derived financial benefit from illicit clips of music, TV, sport? The main problem here is that the DMCA seems to be open to some interpretation and has provided protection to a business that in our view profited from the misuse of others’ copyrights, whilst providing no protection to the wronged copyright holders.
This week we learnt that the BPI has submitted new copyright infringement claims to Google, where it identified not just specific URLs for infringing material, but also entire website URLs such as http://megaupload.com/ and http://mediafire.com/. Interestingly this story broke before news of the ruling in the Viacom case. But clearly the BPI had an inkling that the DCMA was going to be found lacking in terms of providing enough protection. These new infringement claims open two new possible avenues: one being that Google might in future be found liable for piracy for linking to entire infringing sites, not just specific links. Indeed the IFPI has now also written to Google with similar claims, asking it to remove links to The Pirate Bay.
What these claims also prepare the way for is a possible action fought not under the US law, but the new, untested UK Digital Economy Act.
We’re nervous of any anti-piracy moves which seek to criminalise or punish individuals whose piracy is insignificant on an economic scale. But we don’t feel the same way about companies which at the very least display a corporate ambivalence to piracy on a massive scale, but might even be accused of being engaged in a strategy to profit from piracy. We absolutely agree that the BPI and IFPI should make unerring and determined efforts to ensure that Google treats copyright with more respect, and that specifically it must stop providing easy linking access to infringing material.
What’s really bizarre about all this is that Google is apparently planning to launch its own legal music services. A company which appears to show blatant disregard for music copyright also wants to become a legitimate player. Isn’t it time that Google decides where it stands on online copyright infringement? The legislation may allow room for manoeuvre, but the general issue is actually quite simple. Either Google is committed to fighting piracy, or it turns a blind eye. So which is it?
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