With A Choice Between $100 Million In Cash & Fantasyland, The Labels Choose Fantasyland
from the revenue-vs.-piracy dept
I keep having the same conversation over and over again with people in the recording industry. A few days ago, I met with the head of a record label that is doing all sorts of cool and innovative experiments (both on the business model and with technology) and he still kept saying "but we gotta stop people from stealing." The problem, as always, is that they seem so focused on infringement that they miss the bigger picture: What does it actually mean for revenue? These are two separate questions, and the labels seem to prioritize the wrong one. They want to stomp out infringement at any cost, even if the net benefit is minimal.If record labels were given a choice whereby they could support a new revenue stream that would bring in, say, $100 million without them having to do anything... vs. getting no such revenue and playing whac-a-mole with a few more "pirate sites," just making them move elsewhere and not actually get anyone to buy anything, they'd have to be crazy to not go with the $100 million option.
It appears they're crazy.
Google was clear, when it launched its Google Music, that it wanted to do much, much more, but that the things it wanted to do required licenses from the labels. However, the terms the labels offered were completely unacceptable. Now it's being reported that Google offered $100 million to the labels, and a key sticking point was that the labels wanted Google to wave a magic wand, figure out who was "pirating" music, and stop it. In other words, $100 million vs. Fantasyland. And the labels went with Fantasyland.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Filed Under: licenses, music lockers, streaming
Companies: google
Reader Comments
Subscribe: RSS
View by: Time | Thread
[ link to this | view in chronology ]
Re:
[ link to this | view in chronology ]
Re: Re:
[ link to this | view in chronology ]
Re:
Which is exactly why the movie industry is trying to kill netflix. Even though netflix offers a legal alternative to piracy. Given the choice of netflix making money or losing sales on piracy, the movie industry will chose the lost sale.
[ link to this | view in chronology ]
The carriage makers will starve...
[ link to this | view in chronology ]
Re: The carriage makers will starve...
[ link to this | view in chronology ]
Re: Re: The carriage makers will starve...
[ link to this | view in chronology ]
Re: The carriage makers will starve...
[ link to this | view in chronology ]
Re: Re: The carriage makers will starve...
[ link to this | view in chronology ]
Re: Re: The carriage makers will starve...
[ link to this | view in chronology ]
Re: Re: Re: The carriage makers will starve...
[ link to this | view in chronology ]
[ link to this | view in chronology ]
And they want tech solutions
[ link to this | view in chronology ]
Re: And they want tech solutions
[ link to this | view in chronology ]
Google does nothing because it is in Google's interests to do nothing.
Do you really not remember this story?
http://www.nytimes.com/2010/11/28/business/28borker.html?_r=1&hp
Google got criticized because they were promoting popular retailers in their search results who were mistreating customers. Within ONE WEEK they reworked their search method to incorporate an "algorithmic solution".
http://googleblog.blogspot.com/2010/12/being-bad-to-your-customers-is-bad-for.html
How long has piracy been a problem on Google? What attempts have they made at an "algorithmic solution"?
Google enjoys promoting piracy because the law doesn't force them to do otherwise, and promoting piracy makes them money.
Pretending it is a technological problem is ridiculous. It would be a technological problem to block all piracy. But the overwhelming majority of piracy is so blatantly out in the open, you could hit it algorithmically easier than the broad side of a barn.
The top 50 pirate sites aren't even remotely ambiguous about what they are "sharing". They're clear as day. That's why they're so popular.
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
Do you think they would go away if they didn't show up in search results? Do you really think piracy depends on Google or any other search engine?
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
There is no threat of their credibility being compromised with pirate sites. Moreover why would they take the time to block them off? The law is clear, it's not Google's issue; the record labels keep crapping on Google so why are they going to try to help them?
[ link to this | view in chronology ]
Re: Re: Google does nothing because it is in Google's interests to do nothing.
Oh, I get the point exactly. And it seems so do you. Google is doing what is best for Google. Piracy is good for Google's business.
[ link to this | view in chronology ]
Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
They blocked the word "torrent" from autolink. There's nothing in an autolink that actively stops a person from searching for what they intend to search for. That can be the word "bit torrent", The Pirate Bay, or Your mom.
If Google actively blocked words, not actions, from their search do you know how much of a censorship stink would be raised?
Stop wasting time with frivolous BS. People know the word torrent. They know the Pirate Bay exists. Put two and two together, in that people will go to the Pirate Bay when they want to.
And get out of the fantasy that Google owns the internet enough to wave a magic wand and stop people.
[ link to this | view in chronology ]
Re: Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
Even with searching for bittorrent software or content available through bittorrent, that content might be legitimate:
Ubuntu 11.04 torrent
[ link to this | view in chronology ]
Re: Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
The point of an algorithmic approach is it uses a HEURISTIC to detect what is appropriate to promote and what is appropriate to demote. It is the same approach Google uses to demote Content Farms and Spam websites.
No keyword filtering is required.
[ link to this | view in chronology ]
Re: Re: Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
And judging from the recent sessions, it's really fruitless to arbitrarily promote/demote sites like that.
First, who would deem a site a pirate site? The AG as proposed in the PIPA legislation? That's been in Korea for a while. How has that turned out?
Wouldn't the better alternative be to, ya know, put up your own copyrighted work and compete?
Seriously, Google gives so much to working on preventing people from using bittorrent that I'm sure it's going to bite them in the end.
Finally, just think about the wrongful takedowns of Youtube because you have the OPENID system in place. It's utterly dumb for little return when the better way of doing business is to focus on what you and your company do best.
[ link to this | view in chronology ]
Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
Are you the same Anonymous Coward that last week said that most "regular" users weren't pirating and sharing music?
For the sake of argument, let's say that piracy is good for Google's business (no idea if it really is or not, and you can't know for sure either). Doesn't it follow that piracy is not limited to just a few tech geeks? That the average user is more than likely participating in the sharing of culture? That your views that more copyright is always good is not the view of the majority? That suing and alienating the majority of your customer base is a bad thing?
How much cognitive dissonance can you really stand before your head explodes?
[ link to this | view in chronology ]
Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
They look after their own self-interest, yes. So does every business on the face of the planet.
It's not Google's job to make record labels money, especially not when the recording industry makes such a big production out of villainizing Google.
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
[ link to this | view in chronology ]
Citation needed...
[ link to this | view in chronology ]
Re: Citation needed...
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
You're so dumb that you don't even understand that changing their Algorithm would be a technological change to how the site works... Get a damn education.
[ link to this | view in chronology ]
Re: Google does nothing because it is in Google's interests to do nothing.
The simple fact of the matter is that you need to change, because you cannot force everyone else to do so for you. That isn't how the world works.
[ link to this | view in chronology ]
root problem
The problem is, of course, that even if they (by some miracle) manage to "solve" the problem of piracy, it won't stay that way. It's not a one-and-done kind of problem. Within days of most any "solution", the collective internet can and will have found some sort of way around it. Or else they'll invent a new method.
If you're sticking your fingers in your ears like the labels and don't recognize that fact, suddenly their efforts seem more ... well, not well thought out, but less crazy at least. Even if it cost them a few billion in sales to stop it now, if they manage to "stop it" for good all they have to then do is artificial scarcity to bring all of that money back to them.
[ link to this | view in chronology ]
Re: root problem
Glad I don't live your world.
[ link to this | view in chronology ]
Re: Re: root problem
Or are you trying to draw a parallel whereby copyright infringement is interchangeable with murder?
What am I thinking ... of course you aren't comparing copyright infringement and murder ... you would have to be FUCKING RETARDED to make that comparison.
You're not FUCKING RETARDED are you?
[ link to this | view in chronology ]
Re: Re: root problem
We're all about (rightly) punishing murderers. But I seriously doubt the laws are there with any real intent on prevention. The main two types of people who would murder a) feel no qualms about it, so if they don't mind murdering someone they don't care about some arbitrary law made by a government they likely don't care about, and b) do it because of some momentary emotional or mental overload (they get extremely angry, paranoid, etc) and aren't able/willing at that particularly moment to worry about the law anyways.
Having said that, there's not much in there related to my point. I mean, if you want to go that route, I could say that the RIAA doesn't go after potential aliens who might exist and might be listing to music that sorta kinda sounds like it might be similar to something created by a human, during a drunken college party, so since the aren't suing the alien asses off those Plutonian Pirates for all of their Plutonian dirty money, the RIAA really doesn't care about stopping piracy. And we all know that's the trtuh, cause the RIAA is all about peace, love, and screwing others over. Amirite?
[ link to this | view in chronology ]
Re: Re: root problem
Glad I don't live your world.
So now infringement not only equals theft but murder? Glad I don't live your world.
[ link to this | view in chronology ]
Well, after all the bad will they have generated, I am more than happy to watch them implode. How long do you think successful artists will WANT to be with them if they are turning down 100 million in revenue and refusing to license their music?
[ link to this | view in chronology ]
Re:
That hundred million will be eaten up with administrative fees, and other fees, and fees for collecting fees, and investments in ongoing anti piracy efforts.
[ link to this | view in chronology ]
Re: Re:
That's a huge lie. They get paid a ton when they sign with a label. It's called an advance. They use the money to live on and pay to make their album. It gets paid back via record sales.
Which they can't do as well because you rip off music.
And them.
[ link to this | view in chronology ]
Re: Re: Re:
[ link to this | view in chronology ]
Re: Re: Re: Re:
[ link to this | view in chronology ]
Re: Re: Re: Re:
[ link to this | view in chronology ]
Re: Re: Re: Re: Re:
I'd lean toward A, since humans can't even agree on which comments are stupid. However, if you would like to filter out all Anonymous Coward comments, or all comments by any list of users, you can use this script:
https://docs.google.com/document/pub?id=1_DWYEIhgMK54_sBDMj5UnuW0bHmdADnCY3099_9ffFg
[ link to this | view in chronology ]
Re: Re: Re: Re: Re: Re:
[ link to this | view in chronology ]
Re: Re: Re: Re: Re: Re: Re:
[ link to this | view in chronology ]
Re: Re: Re:
http://www.nydailynews.com/gossip/2011/05/31/2011-05-31_lady_gaga_i_went_bankrupt_and_was_3_mi llion_in_debt_after_extending_my_monster_b.html?r=gossip
Please explain how piracy is to blame for this? The dam thing grossed over 220 + million.
[ link to this | view in chronology ]
Re: Re: Re: Re:
This might be part of the problem
Oh, and the fact that her label gets a 360 deal on her licensing. She does all the work, they get all the profit. Truly stunning...
[ link to this | view in chronology ]
Re: Re: Re:
So saying that artists get payed a ton when they sign with a label is like me saying my bank gave me my house when I signed the mortgage. It's a half truth, though it is expected from the recording industry.
[ link to this | view in chronology ]
Re: Re: Re: Re:
Of course.
No artist in their right mind would sign a deal where they only got 10%.
You people don't seriously think that by lying about record labels you justify your stealing, do you?
[ link to this | view in chronology ]
Re: Re: Re: Re: Re:
The recording companies keep 90%, they get 10%.
[ link to this | view in chronology ]
Re: Re: Re: Re: Re:
James Brown, Michael Jackson, Lady Gaga, ALL of them had to deal with that as a "price to pay" for stardom?
Where have you been the last 30-40 years?
[ link to this | view in chronology ]
Re: Re: Re: Re: Re:
but yet i still see people working
the thing is its the only way to work in this country legally
[ link to this | view in chronology ]
Re: Re: Re: Re: Re:
Now does this justify piracy? It depends on who you ask since each person only needs their own level of justification. Me personally.. I just started listening to music licensed under Creative Commons. Why don't we talk about that more often here?
[ link to this | view in chronology ]
My view is that piracy is the by-product of them trying to explain why didn't they make more money or diverting blame from themselves. If piracy were eliminated they move on to radio saying that people aren't buying our music when they can listen to it for free. So lets charge radio even more money. They will keep moving to the next thing till the they come back to the first thing and keep going around.
[ link to this | view in chronology ]
Re:
> saying that people aren't buying our music when
> they can listen to it for free. So lets charge
> radio even more money.
They're already trying to charge radio for money.
They've all but killed Internet Radio.
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Re:
[ link to this | view in chronology ]
Re:
[ link to this | view in chronology ]
Re:
Get your bad guys straight, please. It seems you've gone from "BUT, BUT PIRACY!" to "BUT, BUT MUSIC LICENSES!"
[ link to this | view in chronology ]
Re:
As it is, they turned down the money because of pride and jealousy, not business acumen. These are decisions that should get people fired. These are decisions, based solely on stubbornness that work directly against share holders j- they are faith-based beliefs that have no place in business.
The fact that someone in such a high position in a corporation can keep their job while making decisions that actually go against making money because of what they *want* to be true is dishonest to the people whose money they are losing.
[ link to this | view in chronology ]
Re:
Your choice is take their money and show you can play in the modern age, or let others continue to eat your lunch.
[ link to this | view in chronology ]
Re:
So, despite all the supposed harm of piracy to their industry it's still in the billion range? Talk about high-level griping.
[ link to this | view in chronology ]
What we really need to do...
[ link to this | view in chronology ]
Re: What we really need to do...
Why would you want these morons working for you? All the executives are under contract as well possibly owning stock options. It might cost you more to get rid of them then what the asking price would be and to top that off the slim bags would probably group back and tell the artists how to get outta there contracts and sign up with their new hell spawn they would create after leaving Google.
[ link to this | view in chronology ]
Re: Re: What we really need to do...
How about this: buy the labels, including all the copyrights. Send all the executives home. Keep paying them if they don't want their contracts bought out, just don't let them work (this might still be cheaper than dealing with the labels as they are now). Disband the RIAA. Sell the music for 10 cents per song. Don't worry about piracy. Profit.
to top that off the slim bags would probably group back and tell the artists how to get outta there contracts and sign up with their new hell spawn they would create after leaving Google.
I don't see how that would hurt Google. If some artists are really dumb enough to want to sign up with these guys after everything we've seen them do, then let them. Google can't protect musicians from themselves.
[ link to this | view in chronology ]
Am I Missing Something
[ link to this | view in chronology ]
Re: Am I Missing Something
[ link to this | view in chronology ]
Re: Am I Missing Something
Because they operate under the assumption that you need to have 100% control of the product pre/post sale. If you don't someone can out maneuver you and come up with new and innovative ways for people to get what they want. That's what Google is trying to do.
[ link to this | view in chronology ]
Re: Am I Missing Something
Forgot to answer this part and simple to answer. They don't want spend(or justify) money on something that's not going to directly make them money. Why spend a million dollars going after these sites if you can take that money and give it to some lobbyist so they can get our government to make stupid laws and spend tens of millions of dollars to do their dirty work. Since we all know government money is free money why not use it.
[ link to this | view in chronology ]
Re: Am I Missing Something
Somewhere in the vast interwebs was a story which reported that the labels accepted that there would be a large amount of copying in the digital era - sneakernet, Direct Connect hubs in dorms, etc. What the labels say they can't live with is easily searchable unauthorized downloads, where the unauthorized copy becomes easier to find than the authorized copy. (I'm passing along a distant memory of Big Content's point of view, remember.)
"Can anyone tell me why these industries are not putting their efforts into going after the actual infringers?"
Because they number in the millions and chasing that swarm is not cost-effective. It's also really bad public relations.
[ link to this | view in chronology ]
LMAO
Sure they wanted to give people options that made sense to the consumer and build up brand loyalty. Instead of jamming all types BS down people throats with there take it leave it approach.
[ link to this | view in chronology ]