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?
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