Tuesday, July 26, 2016

Beatport 'dramatically improves profitability'... by dropping streaming

Written by Music Business Worldwide — SFX Entertainment has confirmed that it now has no plans to sell digital music service Beatport, having turned its finances around.

After SFX fell into bankruptcy earlier this year, the sale of Beatport looked to be only a matter of time.

As recently as April, we were being told that a Beatport sell-off process was making progress.

However, in May, SFX postponed the Beatport sale, reporting that while it continued to consider offers, the dance music platform was officially no longer on the block.

That decision now appears to be a permanent one.

In a statement, an SFX spokesperson said: “Our renewed focus on the Beatport Store, following our announcement of platform changes in May, 2016, has been well-received and successful. The changes we implemented have laid a strong foundation for Beatport that have dramatically improved its profitability.

“As a result of these improving trends, SFX has determined that retaining ownership of Beatport is in the best interest of the Company and has withdrawn its motion to sell Beatport through the Chapter 11 process.”



So what changes, exactly, could have lead to Beatport ‘dramatically improving its profitability’?

Simple: the company quit music streaming two months ago, reverting to becoming a download-only store.

Turns out, if you want to make money from digital music, that’s all you have to do.

None of the industry’s current dominant forces in streaming – including Spotify, Apple Music and TIDAL – are believed to be profitable entities.

Even YouTube, with a billion users, is understood to break even or post a negligible profit each year as a standalone business within Google/Alphabet.

Meanwhile, Beatport parent SFX says its plan to emerge from bankruptcy in the US is moving ahead.

“We look forward to emerging from Chapter 11 in the next few months, as strong and vibrant business, positioned to pursue both organic and strategic growth options,” it said.

“The dedicated Beatport management team is committed to continuing to serve our core DJ customer base and enhancing the quality of our customer experience.”

Click here to read from this article's source.

Monday, July 25, 2016

Inside the politics of music at the GOP and Democratic conventions

Written by Dan DeLuca — Musicians get political when they seek to change the world around them. Politicians turn to pop music to pump up a crowd with communal spirit and underscore their message, loud and clear. It's often an unhappy marriage.

Preachy pop stars risk being seen as hectoring and lecturing when they make music that aims to do more than entertain. (Exhibit A: Bono.)

And when presidential candidates - particularly Republican ones - pick songs for rally sound-tracks and emphasize their populist appeal, they frequently face blowback from artists whose political sympathies lean to the left. Queen, for instance, objected to Donald Trump's use of "We Are the Champions" during his dramatic, smoke-filled, WWE-like entrance at the Republican National Convention in Cleveland last week.

Democrats usually have an easier time with pop stars lending their support, as demonstrated by the star-studded Bruce Springsteen-Dixie Chicks-Pearl Jam Vote for Change shows that tried to unseat President George W. Bush in 2004, and will.i.am of the Black Eyed Peas' "Yes We Can" anthem that enlisted Herbie Hancock, Scarlett Johansson, and John Legend in boosting Barack Obama in 2008.

And when the DNC comes to Philadelphia on Monday, there will be plenty of big-name acts eager to be associated with Hillary Clinton's race for the White House.

Most of the performances are not open to the public. Alicia Keys, a founder of the We Are Here social-justice organization, will play a Monday-evening invite-only party sponsored by Politico at Commerce Square on Market Street in Center City.

Pop-funk powerhouse Janelle Monae headlines House Democratic leader Nancy Pelosi's opening-day party Monday and is rumored to be playing other events later in the week. Idina Menzel and Cyndi Lauper are doing a Women's Tea afternoon event the next day.

And Fergie - Black Eyed Peas bandmate of will.i.am - will headline a Wednesday-night gala for the nonpartisan entertainment lobby the Creative Coalition.

Weed-loving rapper Snoop Dogg is at the Electric Factory on Thursday for a closing-night event sponsored by three super PACs. And the "Camden Rising" concert Thursday afternoon at the BB&T features Lady Gaga, Lenny Kravitz, and Jazzy Jeff.

It's cohosted by South Jersey power broker George E. Norcross and is open to convention delegates and invitees, with the Clintons and Obamas on the guest list. If Hillary is still working on her speech, Bill can get down to Kravitz's version of "American Woman."

Never fear, you can get in somewhere without a laminated badge. The Truth to Power multimedia art event presented by Rock the Vote at 990 Spring Garden St. is open to the public and will put on DJ and acoustic acts Monday through Wednesday, as well as My Peoples, a talk show hosted by Rosario Dawson with artists and activists. Opening-night talent includes Philadelphia rapper Freeway, rising classic soul vocalist Andra Day, and DJs Active and Jabair. A closing party will be held on Wednesday at the Fillmore with said-to-be-bigger-name talent.

Although converging conventioneers and media will most likely be gone by Friday, there are events for those who still want more, like Philadelphia rapper and producer Lushlife's Run DNC after-party Friday night at Johnny Brenda's.

In comparison to the Democrats, the GOP confab in Cleveland was a low-wattage affair. But it attempted to use pop music to get its message across.

Trump, of course, has used rock-and-roll at his raucous rallies since kicking off his campaign for the Republican nomination more than a year ago. He has incurred the wrath of many musical acts that object to having their songs played, including the Shangri-Las ("Leader of the Pack") and Neil Young ("Rockin' in the Free World").

Plenty of acts have complained about their music being used by candidates they don't support. Prominent instances include Springsteen's "Born in the U.S.A.," evoked by Ronald Reagan in a speech in Hammonton, N.J., in 1984, and George W. Bush's use of John Mellencamp's "R.O.C.K in the U.S.A."

Usually, when requested, the campaigns cease and desist. But Trump's flouting of conventional campaign rules has extended to his use of music. As the Associated Press reported this year, in general, artists cannot legally stop candidates from playing a song if the political organization or the venue has paid a "blanket license" fee for use of the artist's catalog.

So the Rolling Stones can't stop Trump from playing "Start Me Up." Nor could they keep him from inscrutably playing "You Can't Always Get What You Want" when announcing that Indiana Gov. Mike Pence was his first choice as running mate.

Cleveland is the home of the Rock and Roll Hall of Fame, currently hosting a joint exhibit with the Newseum in Washington called "Louder Than Words: Rock, Power and Politics." It has exhibits focused on Bob Dylan, John Lennon, and Pussy Riot.

Seeking some Ohio synergy, the GOP's convention logo featured a red Republican elephant standing on the neck of a blue (Democratic?) guitar. And Trump promised a "showbiz" convention, even after second-tier attractions like guitarist Joe Walsh canceled a Cleveland gig upon realizing it was an RNC kickoff event.

Anyone keyed into gavel-to-gavel coverage noticed that Saturday Night Live's G.E. Smith led the RNC house band, a skilled unit that had many wondering about their motives when they played a six-minute version of David Bowie's cocaine-referencing "Station to Station."

The media postmortem of Monday's opening night at the RNC was all about Melania Trump's plagiarism of Michelle Obama's 2008 Democratic convention speech.

But the rock-and-roll moment on Monday came when the nominee made his entrance to Freddie Mercury roaring, "We are the Champions" with imagery that seemed borrowed from WWE wrestler Undertaker.

The outcry was immediate from both surviving members of Queen, who called it an "unauthorised use at the Republican convention against our wishes." RNC spokesman Sean Spicer said the convention paid to license use of the song in the arena.

Queen fans, pointing out the irony of the conservative GOP rallying behind a song sung by a flamboyant, gay non-American art rocker who died of AIDS, were outraged. But Trump's use of the song was canny.

Pop songs and their meanings aren't controlled by their creators. Listeners decide what they mean. Springsteen may not have meant "Born in the U.S.A." to be a flag-waver, but plenty of people heard it that way. "We Are the Champions" - along with its similarly stentorian 1977 B-side, "We Will Rock You," - is a song for self-satisfied winners to sing at football stadiums.

And, as America has learned throughout this campaign season, no one likes to talk about what a winner he is more than the Republican nominee. Freddy Mercury may well have been rolling over in his grave, but when he wrote that line about "no time for losers," he gave Donald Trump words to live by.

Click here to read from this article's source.

A list of singers who want Trump to stop the music

Written by Yolanda Young — Here’s a list of those who don’t want Trump playing them.

1. The late Beatle, George Harrison

As if speaking from the grave, the Twitter account of George Harrison, which is controlled by the late Beatle’s heirs, issued this statement:

“The unauthorized use of #HereComestheSun at the #RNCinCLEis offensive & against the wishes of the George Harrison estate.”

2. O’Jays

Walter Williams and Eddie Levert, founding members of Rock and Roll Hall of Fame vocal group the O’Jays said the following in a statement objecting to the use of the RNC playing their 1973 hit “Love Train.

“Our music, and most especially, ‘Love Train’ is about bringing people together, not building walls…I don’t appreciate being associated with Mr. Trump and his usage of our music without permission,” said Williams.

“I don’t agree, whatsoever, with Trump’s politics,” added Levert.

3. Earth, Wind & Fire

After the RNC played Earth, Wind & Fire’s “September,” the Hall of Famers tweeted a statement nearly identical to an earlier tweet from the British group, Queen:

“Another unauthorized use (‘September’) at the Republican Convention, against our wishes.”

4. Rolling Stones

The Rolling Stones told Time Magazine through a spokesman:

“The Rolling Stones have never given permission to the Trump campaign to use their songs and have requested that they cease all use immediately.”

5. R.E.M.

“Go f— yourselves, the lot of you — you sad, attention-grabbing, power-hungry little men,” was the advice R.E.M. lead singer Michael Stipe gave Trump. “Do not use our music or my voice for your moronic charade of a campaign.”

6. Adele

Adele was a bit more subtle when her spokesman Benny Tarantini told CNN:

“Adele has not given permission for her music to be used for any political campaigning.”

Click here to read from this article's source.

Friday, July 22, 2016

So... do new artists really need to sign to a record label?

Written by Tim Ingham — “The old model is on the way out. I’m building the new music industry structure.”

Kobalt boss Willard Ahdritz has never been shy about proclaiming his company’s model – that of artists and writers holding onto their own copyrights – as the future of the music business.

Now a new film from The Economist delves into the pros and cons of musicians disregarding the traditional label deal – ie. receiving advance money in exchange for a lifelong portion of their royalties.

Nick Raphael, President of Capitol UK, makes the case for the defense of major record companies in the mini-movie, part of a series called The Disrupters.

Says Raphael: “We invest millions upon millions trying to find the next superstar, the next brilliant artist… ultimately, the songs that will make the soundtrack to your lives.”



He adds: “We make all the investment, in terms of skillset and money…. and we take the risk.”

In the past couple of years, UMG’s Capitol UK has broken Sam Smith and Five Seconds Of Summer to multi-platinum success worldwide.

Raphael sums up the strongest argument against the ‘artist services’ model that Kobalt offers: that it is yet to truly develop a global new superstar.

“What Kobalt, in my opinion, offer is for artists/writers who do not need advances [or] development,” says Raphael.

“That’s great for the privileged few that can afford it. But actually if a new writer comes along and needs development, time, money and nurturing… that’s not their strongest point.”

Unsurprisingly, not everyone agrees with him.

Sam Winwood, SVP of Creative at Kobalt, comments: “That whole idea of owning your own records and getting someone to market and distribute it for you is the biggest threat to traditional major record labels.

“We’ve said to people… ‘You don’t have to give away your rights to earn money. In fact, you’ll earn more money if you don’t give away your rights.'”

His point is at least partly backed up by Jacob Whitesides, the YouTube star from Knoxville, Tennessee, who boasts over 2m followers on Twitter, 1.5m on Instagram and 1.6m on Facebook.

Whitesides last year launched a joint label with BMG that saw him maintain ownership of his copyrights.



“The fans are more powerful than most any label or bit of promotion you can buy,” says Whitesides in the documentary.

“They post my music, they find other people searching for new music and send them my [tracks]. People pay hundreds of thousands of dollars to get that kind of promotion.

He adds: “A lot of artists don’t need deals; if they can establish a solid touring foundation, they can make money, pay their bills; the fans you’ve already capture create that freedom. I feel a lot of artists lose that when they jump straight to a major label.”

“I have 100% creative control. That’s the one thing I wanted, and that’s not a popular thing in most deals… [BMG] saw the leverage I had and that I didn’t necessarily need them – that it was a partnership.

“The most important thing was going in [to the deal negotiation] with something instead of nothing.”

Ed O’Brien from Radiohead – a band now signed to XL/Beggars but who for years were on the Parlophone/EMI roster – appears to recall his own major label contract with some anger.

“Artist contracts were so weighted in favour of the record companies [in the past] – it was just hugely unfair,” he says.

“I don’t think anyone in the record companies would dispute that… they might [say] we’ve put in lots of investment. Yeah, you have, but let’s talk about [a deal structure] that’s truly fair.”



That opens the door for Kobalt’s Willard Ahdritz to kick the majors – and make the pitch for Kobalt’s sterling reputation when it comes to the technological management of an artist/writer’s income.

“I have never liked bullies,” says Ahdritz. “I don’t see why bullies should [be able to] walk around and make other people’s lives bad.”

He adds: “Kobalt has a big mission… it’s simple, but a big mission: to take the music industry into the digital age with transparency and trust. ”

Other music biz figures featured in The Disruptors episode include Moby, who snaps: “Major labels thought they were more important than the artists, and they never were.

“Now, as the artists leave, they’re clearly seeing that in the world of music, nothing is bigger than the music itself.”

Elsewhere in the video below, you’ll spot Snow Patrol’s Jonny Quinn, Sony Music UK’s VP of Strategy Fred Bolza and Brian Message from Courtyard/ATC management – who discusses Radiohead’s controversial pay-what-you-want release with In Rainbows in 2007.



“If you were in the camp of being excited by innovation and change, you loved it,” recalls Message.

“Clearly, within the recorded music business there’s a lot of people who are not that way, and are still not that way.

“That kind of change is a little bit of a threat.”

Click here to read from this article's source.

Thursday, July 21, 2016

Sony Music Investigated by Rdio for Alleged Collusion in Streaming Music

Written by Eriq Gardner — The music major responds that the suggestion of antitrust violations are "nothing but speculation and conjecture" and pretext for avoiding $17 million claims plus allegations of fraud.

When Rdio declared Chapter 11 bankruptcy in November 2015, the event marked a blight on the music industry's transition from downloads to streams. Losing $2 million each month, Rdio announced it would be selling its key assets to Pandora for $75 million. Distribution of the proceeds has been contentious. Sony Music is still grumbling about what happened on the brink of Rdio's bankruptcy and believes it is being shortchanged. Now, Rdio wants to put Sony on the defensive.

The Hollywood Reporter has learned that Rdio has retained the prominent law firm of Winston & Strawn to investigate Sony on the antitrust front. Rdio has recently told a bankruptcy judge it has "potentially highly valuable claims" against Sony for allegedly colluding with Universal and Warner Bros. in the streaming music market. If Rdio moves forward with an antitrust lawsuit as currently being envisioned, it would be raising similar issues explored in the Justice Department's lawsuit against Apple and book publishers over the way that "most favored nation" clauses in contracts can enforce pricing floors for the licensing or sale of content.

The investigation — which entails how the major labels have communicated with each other with respect to licensing negotiations — will do nothing to settle the simmering bad blood between Rdio and Sony, which exploded in April.

That month, Sony sued Rdio's three top executives, alleging that before Rdio declared bankruptcy, the streamer made misrepresentations, false statements and concealments in order to avoid millions of dollars in payments that had come due as well as win the right to continue exploiting sound recordings from artists including Michael Jackson, Bruce Springsteen, Beyonce and others. In court papers, Sony also has hinted at possibly suing Pandora, too, for its own involvement in the alleged fraud.

Rdio responded by pushing a judge to issue a preliminary injunction on the Sony lawsuit. On Wednesday, though, U.S. Bankruptcy Judge Dennis Montali issued a ruling denying any restraining order.

Meanwhile, as the spoils of the Rdio asset sale get divided, Sony wants more than the five percent it has been earmarked under a reorganization plan. Sony alleges that the bankruptcy has been set up to enrich insiders like Rdio chief executive officer Anthony Bay. With a $12.4 million claim, Sony is Rdio's largest unsecured creditor. Additionally, Sony subsidiary Orchard, which specializes in digital licensing for independents, has a $4.5 million claim and is Rdio's third-largest unsecured creditor. Sony aims to leverage its $17 million stake to block the plan for distributing the Pandora money.

Rdio is fighting back. The debtor not only asserts that Sony's claims for "unearned" minimum guarantees under the streaming licensing deals are unwarranted, but Rdio's lawyers are now looking to possibly sue Sony.

"In particular, the Debtor believes that Sony and Orchard have engaged in anticompetitive conduct to fix and control prices and unreasonably restrain trade for the licensing, marketing, and use of music by services, like the Debtor, for the digital streaming of music to consumers worldwide," states a Rdio motion aimed at compelling the production of documents from Sony. "For example, one of the Debtor’s preliminary antitrust theories relates to what are commonly known as Most Favored Nations clauses ('MFNs') which play a major role in Sony’s agreements with Rdio and in Orchard’s agreements with Rdio."

The bankruptcy judge is told that antitrust enforcement agencies and courts are applying greater scrutiny to MFNs, which guarantee that parties in contracts get industry-best rates. Rdio nods towards a law review article discussing the DOJ's lawsuit over the e-book market. There, Apple was alleged to have organized book publishers into rebelling against Amazon.com with higher prices enforced through MFNs. In return, Apple got a percentage of sales. In June 2015, the 2nd Circuit Court of Appeals agreed that under the right circumstances, MFNs can be misused to anti-competitive ends and can facilitate horizontal coordination and reduce a company's incentive to deviate. Rdio is now probing whether Sony is misusing MFNs "under a collusion theory."

Sony is cooperating to some extent, offering to search the files of its key streaming negotiators and produce its licensing agreements with Spotify, Amazon, Apple, Google, Rhapsody and Microsoft, but Rdio wants more. Among the documents being sought are wide-ranging communications between the labels and with their trade associations as well as any depositions and witness interviews conducted by the FTC, the Justice Department, the European Commission and other regulatory bodies.

Rdio says that Sony has "cherry-picked categories of documents which they know will likely offer little-to-no evidence of collusion" and adds that Sony is stone-walling on documents relating to possible government investigations. The court papers report: "During the June 21, 2016, meet and confer, rather than confirm or deny the existence of any such investigation, Sony’s counsel pressed Debtor’s counsel to identify for Sony the governmental investigation into Sony to which it was referring. But these governmental investigations by their very nature are non-public; and, thus, the demand that Debtor identify for Sony the responsive and relevant governmental investigations into Sony’s conduct — investigations that could, in fact, be highly probative of Debtor’s claims — is absurd."

(No known investigation into the streaming market is happening. Back in 2015, the Justice Department was reported to be looking into Apple for allegedly forcing Spotify into ending free tiers, but according to one source, the investigation closed without any adverse finding.)

On Tuesday, Sony filed opposition documents that characterize Rdio's potential antitrust claims as "nothing but speculation and conjecture."

According to Sony, the MFNs being agreed upon by various entities have material differences (like whether premium tiers on the streaming platform trigger per stream minimums) that are inconsistent with a price-fixing theory, and that the law recognizes that MFNs are widely used in the entertainment industry and "typically are entirely proper."

"The MFN in the Sony Music/Rdio agreement requires Rdio (the buyer) to give Sony Music (the seller) an overall deal that is at least as good as it offers anyone else," states Sony, being represented by eight attorneys at three law firms including Munger, Tolles & Olson. "Debtor has not cited a single case finding that this type of MFN leads to anticompetitive collusion. And for good reason: This type of MFN cannot prevent any record company from providing Rdio or any other audio subscription streaming service a lower price."

Addressing the law review article that discussed the DOJ's case against Apple and the book publishers, Sony says that entailed a "completely different type of MFN — an MFN in which a seller promises to give a buyer the best price it offers anyone else."

Sony says that to comply with the discovery requests would cost millions of dollars and consume months of employee and outside counsel time. It suspects that the debtor is merely attempting to stop Sony from voting to block the distribution of money to Rdio's other creditors. As evidence, it points to settlements that Rdio has made with Universal and Warner Bros. where the debtor got very little to release antitrust claims. "So why is Debtor seeking to impose a multi-million dollar burden on Sony Music if it knows its antitrust claim is meritless?" asks Sony. "The answer is transparent: It seeks to force Sony Music to drop its legal claims."

Click here to read from this article's source.

Wednesday, July 20, 2016

6 Real Problems in Music Business the DOJ Should be Investigating

Written by David Lowery — Songwriters are perplexed by the attention that the Department of Justice Antitrust Division has given to a rather obscure facet of the public performance licensing of songs. 97% of the market is already completely regulated by the ancient (1941) and outdated DOJ consent decrees that govern BMI and ASCAP. Specifically the DOJ antitrust division process sets the public performance royalties for 97% of the songs in existence. There is no legislative basis for this regulation. Most living songwriters were not born when the consent decrees were enacted and thus never gave their consent to have their rights limited. Nor has their ever been any proper due process. This is simply the executive branch gone wild.

Regardless a relatively small amount of songwriters have managed to escape this unconstitutional and overbearing regulation by joining small performing rights organizations like SESAC and GMR not subject to consent decrees. Unfortunately the DOJ’s novel “reinterpretation” of the 70 year old consent decree brings the last of the free songwriters under their control by mandating that any prices for songs co-written with BMI and ASCAP songwriters should be 100% priced by consent decrees and not fractionally priced as is often mandated by existing private contracts and international treaties. This creates absolute chaos in the music licensing system by introducing a host of administrative and payment issues; additional constitutional rights violations; the specter of wholesale withdrawal of publishers/songwriters from the songwriter performing rights organizations; and appearance of impropriety by a former Google lawyer now working in the DOJ as the one entity it clearly benefits is YouTube/Google.

And you might also wonder “how is this even an antitrust issue?” We are wondering that as well. The DOJ has indicated that it views the fact that a tiny percentage of songwriters can refuse to license their songs to monopoly digital services as an existential threat to competition in the digital music marketplace.


This is some spectacular through-the-looking-glass thinking right there. The kind of mass-hysteria-groupthink you can only get when the entire government is run by lawyers that all went to one of four elite copyleft law schools. It takes a special kind of arrogance that only a Harvard, Stanford, Yale or Berkeley law degree gives you to not ask: Aren’t the monopoly digital services actually the real threats to competition? And hasn’t the DOJ by forcing virtually all songwriters to license their songs to these services at below market rates created monopsonies that are driving consolidation among music publishers? Aren’t the actions of DOJ antitrust lawyers killing competition rather than enhancing it?

But that all presupposes that the Department of Justice is in the business of meting out justice and protecting the little guy rather than protecting a few politically favored corporations. To illustrate I’ve come up with 6 real pressing problems that a Department of Justice that was interested in justice would pursue.

Online advertising fraud

The online advertising industry is riddled with fraud. Bots and related fraud ensure that advertisers are paying for ads that no one sees. Ad Week estimates it is costing advertisers 7 Billion dollars a year. Where is the DOJ investigation? Do you think the fact that Google/Facebook control 70% of the online ad market has anything to do with the DOJ’s blind eye? After all these two companies are some of the biggest campaign contributors to Obama/Clinton campaign coffers. The executive branch is lousy with former Google lawyers including Renata Hesse in the antitrust division who appears to be pushing the 100% licensing rule. So how exactly does ad fraud impact musicians? Most digital music services rely on ad revenue. Ad revenue per spin, per click and per view has been falling rapidly because advertisers have lost faith in the entire online advertising system. Hence revenue per spin is rapidly falling. Midia consulting reports YouTube’s per spin rate has been halved in the last year.

Ticket Master/Live Nation/Secondary ticket markets

When most people focus on Live Nation invariably their concern is Live Nation’s share of concert promotion business. This is a misplaced concern. The real problem is that Live Nation owns Ticketmaster which has a near monopoly on ticket sales. This allows Live Nation to extract a “vig” on concerts it doesn’t even promote. It also raises concerns of a data monopoly, whereby Ticketmaster has the biggest and best pool of data on who is likely to buy a Luke Bryan ticket in Buffalo New York. This makes it extremely hard for an upstart to compete against TicketMaster. But the most pressing issue is that billions of dollars of live music revenue is not going to artists. Instead it is going to “scalpers” and ticket resellers. A cursory and unscientific review of the StubHub indicates that most of these tickets are coming from Live Nation/Ticketmaster events. Granted Live Nation/Ticketmaster has a dominant market share, but I find it curious that there are so few tickets sold through TicketFly finding their way to StubHub.

Unlicensed songs on streaming services

What if 25 percent of the CDs in the biggest music chain store were bootleg and no royalties were being paid to songwriters? You would think the DOJ would investigate. Right? Yet Billboard reports that as much as 25% of the royalties payable to publishers/songwriters are not being paid. Meanwhile Senator Warren (hmm another Harvard professor) is urging the antitrust division to investigate alleged anti-competitive practices by Apple on behalf of Spotify. You would think smart Harvard professors would realize not paying 25% of your songwriters gives Spotify an unfair competitive advantage.

Abuse of the DMCA Safe Harbor by YouTube

YouTube is clearly abusing the DMCA safe harbor to extract the most favorable royalty rate from rights holders. It is essentially using piracy by its users as the “broken window” in a protection racket shakedown. How is it that the antitrust division manages to ignore this anticompetitive practice? Fuck that, how is this not a RICO violation? This is why it’s so important that we remove former Google lawyers like Renata Hesse from the antitrust division. This sort of illegal and anti-competitive behavior will never be investigated while Google exercises influence at the DOJ.

Harry Fox Agency/Spotify mail fraud

As I have detailed here, The Harry Fox Agency on behalf of Spotify has been sending many songwriters fraudulent “Notices of Intent” to obtain a compulsory license. Since these notices are not in fact valid compulsory licenses (they have clearly been backdated) they are misleading songwriters into thinking they no longer have a right to negotiate a potentially more beneficial direct license. That is a kind of fraud. I’m not a attorney but the fact these are sent through the US mail this seems to meet the criteria for mail fraud, which is a RICO predicate. Where is that investigation?

The DOJ Antitrust Division Litigation Section III

The Office of the Inspector General of the Justice Department should investigate whether the Renata Hess violated ethics rules by not disclosing work for Google in her official DOJ bio. and pushing through an “interpretation” of the consent decree that clearly benefits her former client. More on how she violated ethics rules right here.

But more important is the big picture on the DOJ Antitrust Litigation Section III. As evidenced by this very article, Litigation Section III which oversees the entertainment industry has not just failed to do its job, its actions have dramatically decreased competition. The entire section is corrupt or incompetent. It should be disbanded or at the very least reorganized.

Click here to read from this article's source.

Tuesday, July 19, 2016

Queen: Trump's Use of 'We Are the Champions' at RNC Was 'Unauthorized, Against Our Wishes

Written by Joe Lynch — Despite being under pressure from Queen not to use their anthemic "We Are the Champions" for his presidential campaign, Donald Trump was all "don't stop me now" and went ahead and used the Queen classic during Day 1 of the Republican National Convention in Cleveland.

This isn't the first time Trump has used the song, and it's not the first Queen has cautioned him against it. Reiterating guitarist Brian May's statement from June 2016 -- where he said "permission to use the track was neither sought nor given. We are taking advice on what steps we can take to ensure this use does not continue" -- Queen's official Twitter account confirmed the band wants to break free from any association with Trump as he plays the game.

"An unauthorised use at the Republican Convention against our wishes," they wrote on Twitter.

Following the RNC's first night, which found star speaker Melania Trump plagiarizing part of Michelle Obama's 2008 speech, Adam Lambert -- frequent frontman of the U.K. band -- tweeted the following meme regarding the association of Queen with Republicans and Trump.

Update: Queen's publishing company, Sony/ATV Music Publishing, has issued an official statement against Trump and the Republicans:

Sony/ATV Music Publishing has never been asked by Mr. Trump, the Trump campaign or the Trump Organization for permission to use “We are the Champions” by Queen. On behalf of the band, we are frustrated by the repeated unauthorized use of the song after a previous request to desist, which has obviously been ignored by Mr. Trump and his campaign.

Queen does not want its music associated with any mainstream or political debate in any country. Nor does Queen want “We are the Champions” to be used as an endorsement of Mr. Trump and the political views of the Republican Party. We trust, hope and expect that Mr. Trump and his campaign will respect these wishes moving forward.

Click here to read from this article's source.

YouTube Claims Music Industry Happy With Content ID - Music Industry Begs To Differ

Written by Emma Woollacott — Google, long under fire from the music industry over YouTube’s Content ID system, has published a report claiming it’s paid out more than $2 billion to rights holders since its launch in 2007.

The controversial right management system is designed to automatically recognise copies of copyrighted material and allows content owners to choose whether to report, block, or monetize the content.

Google claims that most copyright owners choose the cash, implying that they’re happy with the way the system works.

“The music industry chooses to monetise more than 95% of their claims, opting to leave the content up on the platform – half of the music industry’s YouTube revenue comes from fan content claimed via Content ID,” the company’s senior policy counsel Katie Oyama writes.

“Thanks to Content ID, YouTube is also the only platform that gives partners an automated way to directly monetise background/incidental use and covers.”

The company claims that as much as half the music industry’s YouTube revenue comes via Content ID from fan content such as covers, remixes and dance versions.

She adds that the company has also been making efforts to fight piracy by eliminating pirate sites from its ad network; since 2012, it’s blacklisted more than 91,000 sites, Oyama says.

However, rights holders complain that YouTube isn’t paying a fair price for music, as it has them effectively over a barrel.

“Our member record companies’ experience demonstrates that Google’s Content ID tool is ineffective in preventing infringing content appearing on YouTube. Record companies and publishers estimate that Content ID fails to identify 20-40% of their recordings,” says the International Federation of the Phonographic Industry (IFPI) in a statement.

The IFPI also claims that Google’s search engine is still directing people to unlicensed music on a large scale.

“Well over 300 million de-list notices have been sent to Google by IFPI national groups worldwide,” it says.

“Despite this, the amount of traffic to infringing sites from typical music search queries sent to Google is now higher than it was before Google changed its search algorithm to supposedly address levels of piracy.”

And, they say, the Digital Millennium Copyright Act (DMCA) needs reform. Last month, 180 performers and songwriters - from Taylor Swift to Sir Paul McCartney – called for the removal of its ‘safe harbor’ provision, which protects YouTube and similar sites from the infringing actions of their users, as long as they respond to takedown notices from rights holders.

Earlier this week, rights owners took their case to the European Commission, asking it to order YouTube to pay artists more. They are also asking for royalties like those paid by radio stations to be extended to the likes of Spotify and Netflix.

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Monday, July 18, 2016

Apple, in Seeming Jab at Spotify, Proposes Simpler Songwriting Royalties

Written by Ben Sisario — In the music industry’s streaming battles, the fight extends to even the minutiae of copyright.

Apple, in a government filing on Friday, proposed simplifying the highly complex way that songwriting royalties are paid when it comes to on-demand streaming services like Apple Music, Spotify and Tidal.

According to Apple’s proposal, made with the Copyright Royalty Board, a panel of federal judges who oversee rates in the United States, streaming services should pay 9.1 cents in songwriting royalties for every 100 times a song is played. This formula would replace the long passages of federal rules for streaming rates, which often leave musicians bewildered about just how the money flows in streaming music.

But even in this seemingly innocuous proposal, which was not made public but was obtained by The New York Times, Apple’s target is clear: Spotify, its archenemy in streaming music. The proposal would significantly raise the rates that Spotify pays, and the filing includes lines that are clearly directed at Spotify and its so-called freemium model.

“An interactive stream has an inherent value,” Apple wrote, “regardless of the business model a service provider chooses.”

A spokeswoman for Apple confirmed the filing but declined to comment further.

Apple’s streaming service, Apple Music, was introduced a year ago, and it has earned the support of many power players in the music industry — including Taylor Swift — because it does not offer a free version, but instead charges about $10 a month. Spotify, begun in Europe in 2008, has both free and paid versions. This has led to a tense relationship with record companies and music publishers, who say the service’s free tier does not pay enough in royalties and devalues their music across the board.

The battle over free music has extended to YouTube, which the music industry has been campaigning against for months, arguing that the service does not pay enough in royalties and that the availability of so much free music on the site has hampered the growth of paid services. Both Spotify and YouTube counter that they have paid billions of dollars to the music industry.

Last month, Apple said that Apple Music had 15 million subscribers, and Spotify reported that it had 30 million paid users and another 70 million who listen free, with ads.

Although Apple Music has a three-month free trial period, the company has stood staunchly by its model of paid music. “We agree 100 percent with artists that they should have the right to decide where their content is available — whether it’s free or when it’s free, when it should be paid or how much it should cost,” Eddy Cue, Apple’s senior vice president of internet software and services, said in an interview this week with The Hollywood Reporter.

Apple’s filing was made as part of a proceeding by the Copyright Royalty Board to set statutory rates for downloads and interactive streaming services from 2018 to 2022. Spotify, Google, Pandora, Amazon and the Recording Industry Association of America were all expected to file their proposals by Friday, but the panel has not yet made the filings public.

Although the bulk of Apple’s proposal with the Copyright Royalty Board is confined to three brief paragraphs, it would have wide implications if it were adopted. Songwriting rates paid by interactive streaming services like Spotify are now governed by a byzantine system that includes a division between what are known as mechanical and performance royalties for the same songs. Apple’s proposal would cover all songwriting royalties with the same rate. (Royalties for recordings are accounted separately.)

What Apple does not say in its filing, however, is that the statutory rates it proposes would not apply to its own services. When the company introduced Apple Music last year, it struck direct deals with music publishers at rates that are slightly higher than usual.

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Friday, July 15, 2016

The 3 Sources Of Publishing Royalties

Written by Bobby Owsinski — Regardless of the era, the songwriter and publisher have made money, and continue to make money in three primary ways:

1. Mechanical royalties are paid whenever a song is digitally downloaded, a song is streamed from an on-demand service, or a physical CD or vinyl record is sold.

2. A performance royalty is paid whenever a song is played on radio, on television, or streamed over the Internet.

3. A synchronization fee is paid when music is used against picture.

This payment mechanism hasn’t really changed all that much in Music 4.1 from previous music eras, although it’s managed to become even more complicated than it was. What has changed is that during this period in which music sales are far less than half of what they were at their peak, publishing is the one area of the music industry that has held its own. How does that happen when sales, and therefore mechanical royalties, are down, you ask?

While it’s true that mechanical royalties are not nearly what they used to be now that CD sales are so low and downloads have decreased, they’re offset by the tremendous increase in performance royalties because music is now played on so many more broadcasts than before. The 500-channel cable and satellite television universe, along with satellite and Internet radio, provides more opportunities for music to be played, and as a result, more performance royalties are generated.

That said, music publishing income is derived from more sources than you think, and while some of it doesn’t appear significant by itself, it can all add up to a nice royalty check. Here’s an excerpt of a chart from the latest edition of my Music 4.1 book that shows a simple breakdown of when publishing royalties occur, how it’s collected, and the royalty rate.

As you can see, many of the royalties and fees are variable. Synchronization fees consist of an upfront fee which is usually negotiated by the publisher, and a performance royalty whenever the piece containing the music airs on television.

With a movie, the upfront fee is the only one that’s paid for any showings in the theater, but a performance royalty is paid whenever the movie is played on television afterwards.

Likewise, both printed sheet music and digital use of sheet music or lyrics are subject to negotiation. Ringtones are still a source of income not to be overlooked even though the market for them is far below what it was during their peak.

Publishing royalties come from more places than you think, but the rates are different over a wide range of scenarios, which makes it a very complicated subject.

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