DailyDirt: Styli Are Getting Better

from the urls-we-dig-up dept

Microsoft's new tablet computer was announced with a bit of fanfare -- and curiously, a stylus. When Apple introduced its touchscreens (not counting the Newton), Steve Jobs dismissively tossed away the idea of using a stylus and said the finger is the best pointing device around. Well, stylus technology is getting better all the time, and here are just a few examples of some styluses/styli that might beat the finger.

• The Collusion iPad pen isn't just a piece of plastic in the shape of a pen. This pen-like device uses an ultrasound system instead of the iPad's built-in touchscreen to provide better accuracy. Plus it comes with collaboration software and handwriting recognition, so you can share your drawings and notes with other users. (NB: This Kickstarter project hasn't ended yet.) [url]
• The Cosmonaut is a big stylus that is designed to mimic a dry erase marker. This *was* a Kickstarter project, and now it's currently selling for about $25 (shipping not included). [url]
• The PressurePen is an open hardware stylus for the iPad (and Android platform) that gives users a pressure-sensitive way to draw on a touchscreen. Okay, so how many Kickstarter stylus projects are there?!? LOTS. At least this one is open source.... [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post.

Filed Under: collusion, cosmonaut, finger, hardware, hmi, input device, ipad, pen, pressurepen, steve jobs, stylus, tablet, touchscreen
Companies: apple, kickstarter, microsoft

Author Tells DOJ The Authors Guild Doesn't Speak For Him & Amazon Is The Only Company Encouraging Competition

from the questions-to-ponder dept

Author Joe Konrath has written a fantastic letter to the Justice Department to counter letters sent by the Association of Authors' Representatives and the Authors Guild (and some others), complaining about the DOJ's antitrust lawsuit against certain publishers and Apple to collude to keep ebook prices high. As Konrath notes, these groups don't appear to actually represent authors, but do seem to be representing the best interests of the legacy gatekeepers.

I’m writing to tell you that these organizations did not solicit the views of their members, that they in no way speak on behalf of all or even most of their members, and that (as I imagine is obvious) they are motivated not by what’s best for consumers, but by what they see as best for themselves.

I recognize that the heart of the DOJ’s suit is collusion, not high prices. But it’s clear that the legacy publishing industry’s strategy is to keep the prices of ebooks high so as not to cannibalize high-margin hardback sales. If the prices of legacy published books are kept artificially high it could be argued that my lower-priced self-published books are made more attractive by comparison, but I believe that a regime of higher-priced books is bad for the industry overall because it slows the growth of the global book market, which indeed hurts all sales. I also believe it’s obviously bad for consumers, especially lower-income consumers, who could buy more of the books they loved if those books weren’t priced so high.

The whole thing is a worthwhile read, and certainly raises questions about who gets to represent whom when such issues come up. For years, we've seen bogus claims that the RIAA represents "musicians" or that the MPAA represents "filmmakers," when nothing could be further from the truth. In this case, though, it's even more egregious, in that these organizations directly claim to represent authors. But, for the most part, they seem to be only be representing the interests of authors already successful under the old system -- and going against every other author (and potential author) out there. In other words, their focus is on protectionism for established players, not what's best for authors as a whole or the consumers they serve with their writing. That's unfortunate.

Filed Under: authors guild, collusion, doj, joe konrath, publishing
Companies: amazon, apple

Breaking: U.S. Sues Apple, Publishers Over eBook Price-Fixing

from the fresh-news dept

Ever since the Justice Department announced that they were investigating Apple and several publishers over allegations that Apple's agency model for ebook pricing violates antitrust law, we've been waiting for the other shoe to drop. Last night, Reuters reported that a lawsuit was imminent, and now Bloomberg has the news that the government has filed a lawsuit against Apple, Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster in New York district court.

Details are still scarce, but sources say Apple and Macmillan refused to participate in settlement talks while some of the other publishers are still hoping to avoid a drawn out legal battle, and may settle soon. Update: Bloomberg is now reporting that S&S, HarperCollins and Hachette have settled. It will be interesting to see what kind of defense Apple brings, because the evidence of collusion doesn't look good for them at all. Despite Authors Guild president Scott Turow's self-serving claim that this will somehow hurt culture, this is good news for readers: busting Apple's and the publishers' iron grip on ebook prices will likely reduce them across the board.

Here is this the government's complete filing (pdf and embedded below).

Filed Under: agency, antitrust, collusion, ebook, publishing
Companies: apple, hachette, harpercollins, macmillan, penguin, simon & schuster

SoundExchange & A2IM Sued For Antitrust Violations By Sirius

from the sirius-charges dept

Well, well. Last fall, we discussed how Sirius XM was aiming to cut out SoundExchange and try to do deals directly with labels for performance rights. There's some history here. SoundExchange was set up and spun out of the RIAA specifically to collect performance royalties from Sirius XM and emerging internet streaming offerings. Radio doesn't pay performance rights to musicians (they just pay mechanicals to songwriters/publishers), and while the RIAA has wanted that to change for years, it used the "newness" of satellite and the internet to suddenly claim that this extra tax must be paid there, and then set up SoundExchange to collect it. The "rate" was a statutory rate set by the Copyright Royalty Board (CRB), which involved a huge fight, with SoundExchange basically demanding a significant cut of everyone's revenue. The CRB eventually agreed to a sliding rate starting at 6% and moving up to 8% over time -- much, much lower than what SoundExchange wanted (there was an even more intense fight over internet rates, but that is a separate issue).

Even with this "lower" rate, Sirius XM provides a huge chunk of SoundExchange's revenue -- around $200 million last year alone. Realizing that the deal that set up SoundExchange noted that it was "nonexclusive," Sirius sought to cut SoundExchange out of the loop and go direct to labels. Obviously, Sirius's goal is to pay less in royalties, and that led some to wonder why a label would want to do it, since the royalty rate would be lower. Except, it's a little more complex than that.

Sirius notes that in cutting out the middleman, you avoid SoundExchange's (hefty) administrative fee, as well as its notoriously opaque payment process which has left many labels scratching their heads. SoundExchange provides little information as to why artists get paid what they're paid, leaving open significant concerns that the money is not being accounted for properly. Similarly, SoundExchange has been notorious for having "difficulty" finding artists -- though I will say that they've definitely been improving a lot on that front, and really have made a huge effort to reach out to artists. Still, there certainly could be benefits for labels to go direct. Cutting out the middleman, having more relevant and accurate data, as well as more timely payments could certainly be worth it. In fact, Jeff Price at TuneCore explained how indie artists who were their own labels would almost certainly benefit by going direct.

However, the wider industry flipped out and closed ranks, with SoundExchange, the RIAA and A2IM (like the RIAA but for indie labels) all urging labels not to have anything to do with direct deals. Sirius XM looked at all of this and saw a clear antitrust violation as it certainly feels like the entire industry colluding against it. To that end, it has sued SoundExchange and A2IM for antitrust violations -- and even gone so far as to ask for SoundExchange to be "dissolved and unwound." While the actions of other music industry trade groups -- including the RIAA, NARAS, AFRTA and AFM -- are mentioned in the lawsuit, they are not listed as defendants (yet). The focus is very much on SoundExchange and A2IM, whose boss, Rich Bengloff, sits on the board of SoundExchange (along with a bunch of RIAA folks).

In the filing (embedded below), Sirius reports on multiple attempts it made to sign deals with indie labels, in which it was repeatedly rebuffed with claims about how Rich or A2IM had urged them not to do direct deals.

For example, Sirius XM's direct license outreach to independent label Bandit Records was short-circuited when a representative of Bandit Records told Sirius XM that "[w]e're members of A21M and Merlin. I think that prevents a direct license." Upon information and belief, one or both Defendants communicated with Bandit Records (or through its representative Merlin Network) and pressured them to refuse a direct license.

O. Sirius XM's effort to engage in direct license discussions with independent label Unitedlnterests was similarly derailed when, on August 30, 2011, a representative of Unitedlnterests wrote: "I heard that XM was making these requests. I will look at the license, but will also confer with A2IM and other indies." Upon information and belief, UnitedInterests pursued those discussions and therefore agreed with A2IM and/or other record companies not to enter into a direct license.

Sirius XM's approach to independent label CA Management was stopped in its tracks when, on October 27, 2011, a representative of CA Management told Sirius XM that he was "getting mixed reviews about the best way to handle" the direct license offer. Several weeks later, on November 15, 2011, he told Sirius XM that "the RIAA has asked everyone to hold off." CA Management never entered into a direct license with Sirius XM because, upon information and belief, after CA Management communicated with RIAA, it agreed to participate in the industry boycott.

There are more, similar, examples in the filing. There's also a discussion of some indie labels who did sign on, but then backed out, claiming pressure from A2IM. From the filing:

Defendants' unlawful efforts have also extended to extracting agreements from labels that have already signed direct licenses to attempt to back out of them. By way of example. on November 28. 2011. Sirius XM entered into a direct license with Paracadute, TMB Productions, Michael Doughtv. and Michael Viola. On February 9, 2012, Paracadute and TMB Productions requested that they be released from the deal. Surprised by this request, Sirius XM's agent asked Darren Paltrowitz, the person with whom they had negotiated the deal, for an explanation. Mr. Paltrowitz's, response was an e-mail with talking points strikingly similar to the Defendants' press release, which Mr. Paltrowitz indicated were supplied by the bands' business manager. That business manager is Perry Resnick, an artist manager with RZO LLC, and a longtime member of the SoundExchange Board. After further discussions, on February 22, 2012, Mr. Paltrowitz wrote that he "relayed [Sirius XM's] feedback to RZO, and they -- per conversations with A2IM and other folks beyond SoundExehange -- stand their ground about wanting us to opt out" of the direct license. That same day. Mr. Paltrowity cut and pasted an email he received from Mr. Resinick that stated: "I know for a fact that Rich Bengloff, the head of A2IM ... is against this. Rich and I have had this exact conversation, and are both in agreement that SoundExchange is the better way to go."

Of course, there are a few reasons why SoundExchange and its board members would be so against this. As noted earlier, they still think that the royalty rates should be much higher, and have indicated multiple times that in the next round of ratesetting at the CRB, they are going to push for royalty rates double to triple of what Sirius XM is already paying. That's certainly part of why Sirius would like to cut them out of the picture. But, as some have noted, doing direct deals outside of SoundExchange doesn't just let Sirius avoid whatever crazy rates the judges at the CRB choose out of thin air, but it allows them to argue that the actual market rate is lower. You see... the way the CRB works is that it's supposed to try to set a statutory rate that is effectively what the market would choose on its own. Historically, since there were no market-based deals, it had nothing concrete to base its decision on, other than what SoundExchange or Sirius told the judges. However, if Sirius is able to cut direct deals (and do them at an even lower rate) then when the CRB hearing comes around, Sirius now has empirical evidence of a lower market rate. That's a pretty big deal.

Honestly, I'm not sure either side in this fight comes out looking good. It's really just a fight about who pays how much, and who gets a cut. This is the kind of messy thing that happens when a clueless Congress decides that a clueless judicial board should magically "set rates" based on nothing in particular. Sirius XM is hardly an angel in this fight, but based on some of the quotes in the filing, there may be something of a case here -- though proving full on antitrust violations are not easy.

The real issue, it seems, is that groups like A2IM are supposed to represent the industry, but are not supposed to be a central point of collusion for the industry, driving policy decisions back to the labels. That's coordinated effort among competitors that could very well cross the line. The close-knit nature of the SoundExchange board makes all of this even more complicated (and again raises serious questions why Congress ever allowed SoundExchange to be birthed from the RIAA, rather than being truly independent in the first place). I can't image a court would actually dissolve SoundExchange, but if it turns out that this lawsuit has legs, things could get very, very messy in the industry (and it certainly could shake up A2IM in a big way as well). This is one worth paying attention to.

Filed Under: antitrust, collusion, copyright, direct license, performance rights, rich bengloff, royalties, satellite radio
Companies: a2im, riaa, sirius xm, soundexchange

Why Hollywood's Six Strike Plan Should Be Investigated For Antitrust Violations

from the good-points dept

With there being renewed interest in the questionable deal between the RIAA/MPAA and the US's largest ISPs to set up a "six strikes" graduated response plan to cause trouble for those accused (not convicted) of file sharing, some are beginning to realize that the whole plan deserves serious antitrust scrutiny. After all, you have the representatives of two major industries getting together in a room to collude on a plan that will make internet access more expensive for users.

On top of that, since it's based on mere accusations (not convictions) -- and those accusations will come from a company with a terrible track record for accuracy -- you'll have to pay to challenge a strike and (most ridiculous of all) if you do challenge it, you are limited to just six defenses -- significantly less than are allowed under copyright law. That is, if the work is in the public domain, but published after 1923, you have no official defense under the plan. In other words, not only does the plan involve collusion among multiple big industries, but at the outset it assumes guilt before innocence, makes you pay to claim you're innocent, and won't even let you use basic defenses afforded to you under existing copyright law.

All of that seems of questionable legality. It also makes the White House's direct involvement in brokering this plan look even worse. And, once again, it makes us wonder why the real stakeholders, internet users, weren't given a seat at the table. If they were, perhaps this would have been avoided.

Of course, given the White House's involvement in brokering the deal, there doesn't seem much likelihood that the Attorney General will bother to scrutinize the agreement, since it would effectively be challenging his own boss.

That said, the article linked above suggesting that an antitrust inquiry seems necessary is written by Sean Flaim, and is based on his even more thorough research paper detailing why this program needs to be reviewed for antitrust violations. Unfortunately, the chances of that actually happening are still pretty slim.

Filed Under: antitrust, collusion, five strikes, graduated response, isps, six strikes
Companies: mpaa, riaa

Wikileaks Can Receive Visa & Mastercard Donations Again... But Visa Doesn't Understand Why

from the for-the-lulz? dept

Last week, Wikileaks and Datacell threatened to sue Mastercard, Visa and Paypal if it didn't stop blocking payments to Wikileaks. The claims were basically collusion charges, in that all of the major payment companies were blocking payments. Things got strange today, however, when suddenly Datacell announced that payments worked again, and clearly implied that the companies had lifted the blockade. Except, Visa is insisting that it has not lifted its ban on Wikileaks and has no idea how payments are getting through. The details seem a bit sketchy. Some careful wording by Datacell's CEO suggest that he really just found an alternative payment gateway provider, which likely means this is a very temporary loophole, before the payment companies block again.

Filed Under: antitrust, collusion, europe, wikileaks
Companies: datacell, mastercard, paypal, visa, wikileaks

WikiLeaks Planning Legal Action Against PayPal, MasterCard & Visa

from the thought-this-would-go-away? dept

There hasn't been much talk lately over the fact that PayPal, MasterCard and Visa all cut off Wikileaks late last year, after the US government freaked out about the release of some State Department Cables. None of the firms has done a very good job explaining why this makes sense (or why they continue to allow other groups, such as the KKK to receive funding, while singling out Wikileaks). I'm sure those three firms, which took quite a public bashing when the news originally dropped, would prefer that there not be any more talk about it. However, Wikileaks and the payment firm they used, DataCell, are apparently planning to file a legal complaint this week against all three firms in Europe. A draft of the complaint, which was obtained by Andy Greenberg at Forbes (linked above and embedded below), claims that the three firms violated Articles 101 and 102 of the EU Treaty, effectively a form of antitrust law. While I tend to think many antitrust claims are merely attacks on successful companies, this seems like a case where they could make sense. Here you have basically the only three ways for most people to transfer money easily, all agreeing to block a single (small) client from receiving money, despite no legal ruling against the operation (hell, charges haven't even been filed). It certainly would make for an interesting case.

Filed Under: antitrust, collusion, europe, wikileaks
Companies: mastercard, paypal, visa, wikileaks

Supreme Court Lets Price Fixing Claims Against Major Labels Over Digital Music Move Forward

from the fix-that dept

For many years, we wondered why the major record labels weren't brought up on price fixing charges concerning their various digital music deals. It involved all of the major labels working out deals where the price of music was exactly the same across the board and where it was the labels themselves who got to determine the end-user price rather than the retailer, which seemed like clear cases of price fixing. It used to be that manufacturers were not allowed to require a retailer to price in a certain way, as that would be prima facie evidence of price fixing but more recently rulings have dialed back that rule. Still, it seemed like some of the other aspects of digital music pricing still represented clear price fixing. It took long enough but finally some people sued. While a lower court had tossed out the lawsuit, last year we noted that the 2nd Circuit appeals court had reinstated it. The labels appealed to the Supreme Court, who has now allowed the case to move forward by rejecting an appeal from the labels. At this point, I wonder if the labels won't try to settle the lawsuit in an attempt to avoid a full trial. The chances that the labels might lose seems decently high and the costs to them could be quite high.

Filed Under: collusion, price fixing, record labels, supreme court

Are Silicon Valley Angel Investors Colluding Over Deals?

from the meritocracy? dept

"People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices." -- Adam Smith, the Wealth of Nations
Mike Arrington, over at TechCrunch, has a troubling story about an apparent meeting between some of the top angel investors in Silicon Valley, allegedly to collude on deals. Arrington was alerted to the meeting -- bizarrely held at a restaurant where anyone could see them -- and while he knows these guys well, they were clearly unhappy to see him and wouldn't talk to him at all. After he spoke to some investors later, he got the scoop on what was happening:

This group of investors, which together account for nearly 100% of early stage startup deals in Silicon Valley, have been meeting regularly to compare notes. Early on it was mostly to complain about a variety of things. But the conversation has evolved to the point where these super angels are actually colluding (and I don't use that word lightly) to solve a number of problems, say multiple sources who are part of the group and were at the dinner. According to these souces, the ongoing agenda includes:

• Complaints about Y Combinator's growing power, and how to counteract competitiveness in Y Combinator deals
• Complaints about rising deal valuations and they can act as a group to reduce those valuations
• How the group can act together to keep traditional venture capitalists out of deals entirely
• How the group can act together to keep out new angel investors invading the market and driving up valuations.
• More mundane things, like agreeing as a group not to accept convertible notes in deals (an entrepreneur-friendly type of deal).
• One source has also said that there is a wiki of some sort that the group has that explicitly talks about how the group should act as one to keep deal valuations down.

As Arrington notes, this seems like a classic case of collusion and price-fixing. He doesn't name names, but if you're talking about the 15 angels who represent most of the early stage startup deals, it's not difficult to put together that list if you spend any time in startup circles. Arrington notes that some of the participants he spoke to said they were uncomfortable with the meetings, and there to "gather information, not participate," but it's still troubling. One bit of disclosure here, while I don't know who was at the meeting, if Arrington is being accurate in saying that they represent nearly all of the early stage deals, there's a very good chance that at least one of Techdirt's investors would have been involved.

While there are plenty more angels in Silicon Valley than just 15, it is true that, these days, companies getting investments from some of the "top" angels is seen as the ticket needed to move up the chain to big name venture capitalists as well. So hearing that a group of these investors may be colluding to effectively fix pricing is bad news for the supposed "meritocracy" of funding in Silicon Valley, and should be seen as a pretty serious problem.

Along those lines, I should say kudos to Arrington for publishing such a story. While he doesn't name names, these investors are the key sources for many of his stories, so publishing this story is probably burning some bridges with sources. It's good to see that he wouldn't let that get in the way (not that I thought he would -- Mike's always been great in that a good story trumps all other concerns, which is highly admirable).

Filed Under: angel investing, collusion, price fixing, silicon valley, venture capital

Fine, Let Newspapers Collude

from the just-get-it-over-with-already dept

We've heard from more than a few journalists over the last few months, thinking that the best way to save the newspaper business is for newspapers to get a special antitrust exemption from Congress that would allow them to collude and all agree to put up paywalls. The latest to join the chorus is Tim Rutten at the LA Times, and it's basically more of the same. For people who are supposed to be great journalists, you'd think they could think more than one move out, and realize what the inevitable response would be to newspapers all ganging up and putting up a paywall. The problem that Rutten, and the others before him, have made is assuming (incorrectly) that if they put up paywalls, people will suddenly, magically, want to pay. This sort of conceit is seen in a poll put together by a Canadian TV producer by the name of Wodek Szemberg. Over the weekend he set up a poll asking people how much they would pay per month for the news they read... and the price starts at $10. As Mathew Ingram pointed out, Szemberg's post is missing zero as an option (I'd argue it's also missing a lot of other numbers -- starting at $10 is incredibly presumptuous). Szemberg responded to this criticism by saying that zero isn't an option because zero will not exist for access to sites. Trust me, for many people, zero will absolutely exist as an option.

It's difficult to think of anything to say to people who think these ways, other than "good luck." The real world doesn't believe in such limitations. If the newspapers collude and come up with a pricing scheme where the lowest option starts at $10 per month -- fine. Just go do it, and then let's see what happens. Because talking about it is getting pretty silly.

But here's my guess as to what happens:

1. Smart news publications break off from the "charge 'em" pack and remain free and/or experiment with more creative business models.
2. Traffic to the paywall sites drops to ridiculously low levels.
3. Those sites realize that the revenue from subscriptions is a blip and barely noticeable.
4. In removing much of the audience, those sites also lose pretty much all leverage with advertisers, and discover that their online ad revenue drops quite a lot as well.
5. Meanwhile, remember those smart publications that didn't join in the suicide party? They're soaking up plenty of traffic, and working hard to provide more value to readers.
6. On top of that, newer startups spring up to fill in the void left by the paywall crew.
7. Smart journalists start jumping ship from the legacy papers behind the paywall to those who actually get them some public recognition (which are a lot more fun anyway).
8. Without competition from, or the legacy business structures of, the paywall newspapers, the smarter publications start bringing in both audience and revenue (not all of it advertising).
9. The paywall crew goes back to complaining to the gov't, though people start to wonder why they're still around, when there's so much useful journalism going out without paywalls.

So, go ahead. Just get it over with, so we can stop writing this post over and over again, and you guys can clear the field for the real innovators.

Filed Under: collusion, journalism, newspapers, tim rutten