Major Labels Claim Copyright Over Public Domain Songs; YouTube Punishes Musician

from the not-cool dept

We've talked in the past about how YouTube's ContentID system fails at fair use and the public domain -- whereby it is unable to distinguish public domain material. That has resulted in ridiculous situations, often where large companies with huge catalogs end up shutting down perfectly legal content. Sometimes it's crazy stuff like taking down a video because of birds chirping in the background, but other times it can result in public domain music being pulled down.

Musician Dave Colvin appears to be dealing with the latter, as he noted in a frustrated Facebook post about how the publishing arms of the major labels keep claiming copyright on public domain cover songs that he's been recording and posting to YouTube. The end result is that, even though all of these claims are bogus, YouTube is threatening to take away his ability to monetize his account, and have already disabled it on a public domain song.

I am fed up with YouTube. Several times I have provided evidence that my video "O Little Town of Bethlehem" is a Public Domain song and each time I get an email saying the song is owned by either Warner Chappell or UMPG or Sony. Now they have disabled my being able to earn any money for the number of times the video is viewed. We are only talking about pennies but no one "owns" a Public Domain song.

They now have threatened to totally disable my account from monetizing any of my videos because of multiple "false" claims of ownership. Since there is no way to speak to a human being directly, there will never be a way to convince them of the error of their ways....Fed up!

(And just to cut this argument off before it even begins: you can absolutely make money from public domain material, you just can't stop others from doing the same thing). Again, this isn't the first time we've seen this kind of thing, and it's a situation that YouTube really needs to figure out a solution to.

Filed Under: business models, contentid, copyfraud, dave colvin, monetization, music, public domain
Companies: google, sony music, universal music, warner chappell

Paramount Thinks That Louis CK Making $1 Million In 12 Days Means He's Not Monetizing

from the does-anyone-take-these-people-seriously? dept

One of the more annoying things about debates on copyright law, is that when we talk about alternative business models that do not rely on copyright, some people feel the need to insist that this means making less money -- or, even, making no money at all. There is just this assumption that an alternative business model means something along the lines of "give it away and pray," when nothing could be further from the truth. Yet this kind of thinking is so ingrained, that even in stories of artists making a ton of money, some maximalists simply assume that they're not making any money. We saw this recently in the comments to one of our recent posts about Jonathan Coulton which talks about how he made $500k last year -- at which point, someone said that such examples are useless since no one will pay.

It appears that Paramount's "Worldwide VP of Content Protection and Outreach" Al Perry also fits into the same unthinking mode. We've already discussed Perry's recent talk to Brooklyn Law School, but there was one section that caught my eye and deserves a separate post. It comes right at the beginning:

Perry opened by noting that one has to articulate a problem before seeking to solve it, and he refers to the problem as “content theft.” He pointed out that copyright law gives creators the right to monetize their creations, and that even if people like Louis C.K. decide not to do so, that’s a choice and not a requirement.

Now that seems bizarre and totally unsupportable. Remember, Louis CK made over $1 million in just a few days -- an amount that he admits was much higher than what he would have received just for a straight up performance. In what world does going direct-to-fans, building a good relationship, automatically mean no money made at all? Not the one we're based on.

Filed Under: al perry, jonathan coulton, louis ck, monetization
Companies: paramount

Attention! Monetizing Spotify Apps Is The Same As Monetizing Music

from the now-that-I-have-your-attention... dept

Recently Spotify launched its app platform, a significant step into a future where music licensing can function like an API. Which of course should have been made possible a long time ago, but corporations' loss of control was preventing that until they finally found a way to out-leverage the indies - or maybe that's just a coincidence.

So recently we've been seeing a phenomenon I like to call the Rage Against The Stream, where artists & labels have been pulling their content from services like the aforementioned. I probably don't have to point out that in a reality where everyone is competing with free, attention has become more scarce and valuable than ever before and thus the categorical dismissal of access models such as subscription services is unlikely to pay off in the long run (p.s. I love understatements).

The day after Spotify launched its platform, articles started popping up, commenting on the fact that it's impossible to 'monetize apps' and there thus being "no clear upside to developers." And that's where I grab my BS-defense-stick and start drawing the line.

No, you can't put ads in your app.
No, you can't charge for the app or create in-app purchases.
No, Spotify doesn't give you part of the revenue of music streamed through your app.
So?

It's the same lack of creativity of coming up with innovative business models that can be seen in other parts of the music industry... what's new is that this time it's coming from the tech side. What it comes down to is the same as competing with free - and saying you can't compete with free is saying you can't compete period.

Want to make money by building a Spotify app? Build one that uses Facebook Connect for user registration, focus on building a great experience that's non-obtrusive, make it easy to share this experience and funnel that back to your main platform (that's outside Spotify) - focus on discovery and then sell the premium. The SongKick app is a good example, but it can be applied in many more ways. Since it's going to be primarily power users and music geeks using the apps for now, items like vinyl copies come to mind. Focus on gaining & holding the attention - which is scarce, then build your way towards monetization by doing something that Spotify is not.

Spotify Apps are highly monetizable, you just have to be creative. Just like with music.

Filed Under: business models, monetization, platforms

Did The Recording Industry Really Miss The Opportunity To 'Monetize' Online Music?

from the basic-economics-time... dept

There's been a lot of talk in the last year or so about the fact that the recording industry supposedly "missed an opportunity" to "monetize" online music a decade ago when it failed to come to an agreement on licensing with Napster. The idea was that Napster could have been iTunes, and people would be paying for music. That claim is made, yet again, in a CNN article about the decade since Napster, with a Forrester analyst claiming:

"That four-year lag [between Napster and iTunes] is where the music industry lost the battle," said Sonal Gandhi, music analyst with Forrester Research. "They lost an opportunity to take consumers' new behavior and really monetize it in a way that nipped the free music expectation in the bud."

That implies that if the industry had simply licensed its music online in 1999, rather than 2003, the dollars spent on recorded music would have remained propped up. I don't buy it. This ignores the fundamental economics of what's happening in the industry -- but, thankfully, some folks are noticing this. Matt Yglesias points out how wrong the claim by Forrester is, by noting that the market for recorded music was due for a correction just based on fundamental economics:

Music industry executives can tell themselves that as long as they want. But under conditions of perfect competition, the price of a song ought to be equal to the marginal cost of distributing a new copy of a song. Which is to say that the marginal cost ought to be $0. That's not a question of habit, you can look it up in all the leading textbooks. Of course real businesses rarely operate in circumstances of perfect competition, and record companies have a variety of political and legal tools they can deploy to try to protect monopoly rents. But this is hard to do. I think the real story with the iTunes store is that over time competitive pressure has impelled it to largely drop DRM and over time I expect we'll see that the CPI-adjusted price of songs declines.

Tim Lee, who pointed us to this piece in the first place, tacks on the point that "the economic argument for free music is unrelated to 'piracy.'" This is, indeed, a key point and one we've tried to make in the past, but one that sometimes gets lost in the shuffle. The basic economics of music suggest that it was going to face downward pricing pressure all along. That has little to do with unauthorized access to music or whether or not the major record labels sucked it up and did licensing deals with Napster. It was just where the market was going to head one way or the other -- because, over time, more and more people would begin to realize that free music was an excellent promotional tool for other things, and that would drive more business to those other areas. That, in turn, would lead more and more musicians and their business partners to recognize the benefit as well. In fact, we're seeing that happen today. The fact that unauthorized access to files online may have helped push that realization forward doesn't change the fact that those pressures were going to come one way or the other.

The recording industry may have missed a chance to slow down the decline in recorded music sales, but it hardly could have kept the numbers as artificially inflated as they used to be.

Separately, the CNN article is incredibly weak in that it makes the mistake of implying that the recording industry is the entire music industry. It completely ignores the fact that the overall music industry has actually been growing as sales of recorded music have dropped. People have just shifted their spending habits, and that likely would have happened whether or not any licensing deal had been worked out in 1999.

Filed Under: business models, economics, monetization, music, napster

Social Networking Sites Still Struggling With The Whole Monetization Thing

from the underpants-gnomes dept

The history of social-networking sites has largely been dominated by two trends: first, no matter how popular a site seems to be at any given moment, it's probably living on borrowed time. Second, no matter how much traffic a site pulls in, it's going to have a really hard time monetizing it. While the likes of Facebook and MySpace have resisted the former thus far, the latter remains a big problem -- as it has been for some time. Given this history, it's hardly surprising to see an NYT story this week about how little success marketers are having on sites like Facebook. They're finding that banner ads get ignored (again, unsurprising), while their efforts to do "social advertising" aren't bearing much fruit. The article mentions the Facebook page for Procter & Gamble's 2x Ultra Tide laundry detergent, which has attracted 471 fans, and 9 responses thus far to the question "Your Favorite Place to Get Stained?" It's hard to imagine what the P&G marketers expected, but it really doesn't seem surprising that people wouldn't flock to affiliate themselves with some laundry detergent. While some brands do attract that kind of attention, overall, the evidence says that people don't necessarily have a lot of interest in using social-networking sites to interact with brands, while many social-media efforts by companies aren't trusted and are seen as little more than shilling.

This is a big problem for social-networking sites as they continue to struggle to justify their massive valuations with real revenues. Part of the problem seems to be the marketers' mindset and how they see social networking or blogging as some magic sauce that will instantly boost sales and gloss over bad products. The challenge facing Facebook and its ilk is twofold. The sites need to better develop their marketing offerings beyond ineffective banner ads, but do so in a way that doesn't annoy users and trample their privacy, as they'll end up doing more to damage their advertisers' brands than boost them. But the bigger challenge is changing marketers' mindsets and getting them to understand how best to interact with users online. While the sites might see their role solely as selling advertising space, they must be the ones to take a leadership role and help educate and enlighten marketers, if only to help ensure their own survival.

Filed Under: ads, monetization, social networks
Companies: facebook, myspace