Short Sighted Newspaper Association Asks Trump To Whittle Down Fair Use, Because It Hates Google

from the this-is-really-dumb dept

Sometimes you wonder just how ridiculous some legacy industries can be. The latest is the News Media Alliance, which is apparently the new name of what was the Newspaper Association of America. Just a few months ago, we were mocking that organization's ridiculous proposal that readers of newspaper websites should be forced to allow invasive ad trackers, and that adblockers shouldn't be allowed. And believe it or not, now the group has even worse suggestions. It has sent a "white paper" to Donald Trump with the types of things it's looking for from a Trump administration. The white paper is really just a 3 page memo dressed up slightly with the term "white paper" at the top -- as opposed to a carefully developed plan.

But the really ridiculous bit is that these media publications -- who regularly rely on fair use, are asking Trump to dump fair use:

Strong copyright protection is needed. Newspaper content makes up approximately two-thirds of the content on news aggregation platforms such as Google News, but many of these relatively new players in the digital ecosystem build audiences and generate revenue from newspaper content with little if any revenue coming back to those who have invested in creating the original content. Today, the news media industry invests roughly $5 billion each year in long-form investigative journalism. Our nation’s copyright laws must be structured and implemented in a way that allows for a return on this massive investment. Today, outdated interpretations of copyright laws mean that the industry is currently forced to give away much of its product for free. The government needs to put in place copyright protections that allow news organizations and other content creators to fairly benefit from their critical efforts and investments.

“Fair use” should be reoriented toward its original meaning. Under current copyright law, a person that does not own a copyright may still use a copyrighted work if it is consistent with the “fair use” factors, which assess: (1) the purpose and character of the use, (2) the nature of the copyrighted work, (3) the amount and substantiality of the portion taken, and (4) the effect upon the potential market. The courts, unfortunately, have dramatically weakened this test by finding a fair use any time a new use could be seen as “transformative.” This test has undermined the integrity of the long-established fair use factors. As part of any Copyright Act rewrite, we support refocusing the fair-use test on its original purpose to prevent courts from undermining the Constitution’s encouragement of compensation to entities that generate creativity and productivity.

This is dumb on so many levels. First, the claim that newspapers don't get any revenue from the likes of Google is ridiculous, when you consider how much they whine and freak out if Google removes them from search. They get revenue in the form of traffic from aggregators. If they're bad at monetizing it, that's one thing, but that's not the aggregators' fault.

Second, copyright laws should never be designed with the idea of making sure it enables recouping an investment. Because copyright is not the business model. Copyright is a mechanism that creates a business model, and that business model may or may not be successful. Just saying you invest $5 billion and therefore copyright needs to cover that nut makes no sense. I could just as easily claim that I'm going to invest $5 billion in improving Techdirt -- and therefore Trump needs to make sure that there's a business model to allow me to recoup that? No, that's crazy. It's not the government's job to make sure your own bad business decisions still pay off.

Third: the media attacking fair use is insane. Newspapers regularly rely on fair use in their reporting, and the group is shooting itself in the foot in asking Trump to take away that tool. This is especially true given that Trump himself has insisted he wants to "open up our libel laws" with the specific aim of harming newspapers. Remember, this is the context in which he said he was going to open up such laws:

If I become President, oh, are they going to have problems. They're going to have such problems.

... One of the things I'm going to do if I win, and I hope we do and we're certainly leading. I'm going to open up our libel laws so when they write purposely negative and horrible and false articles, we can sue them and win lots of money. We're going to open up those libel laws. So when The New York Times writes a hit piece which is a total disgrace or when The Washington Post, which is there for other reasons, writes a hit piece, we can sue them and win money instead of having no chance of winning because they're totally protected.

.... So we're going to open up those libel laws, folks, and we're going to have people sue you like you've never got sued before...

While he was specifically talking about libel laws, as we've seen over and over again, copyright is an amazing tool for censorship as well. In fact, the Supreme Court itself has noted that fair use is the necessary "safety valve" on copyright's free speech stifling powers. So for newspapers to basically gift wrap to Trump a way in which he can pull back a tool that protects their free speech -- just as he's been promising to attack their free speech -- is ludicrous.

About the only saving grace in all of this is that Trump acts as if he hates the big newspapers so much, that perhaps he'll have no desire to make them happy by following through on this idiotic suggestion.

In the meantime, if you work for a news organization that is a member of the News Media Alliance, maybe ask them why they're undermining a core principle of free speech in asking for fair use to be limited?

Filed Under: aggregation, business models, copyright, donald trump, fair use, free speech, news, newspapers
Companies: google, news media alliance, newspaper association of america

ISP Feebly Tries To Defend Usage Caps By Comparing Them To...Oreos

from the words-are-like-wind dept

Earlier this month, we noted how Netflix had complained to the FCC about broadband usage caps, quite-correctly noting they're little more than price hikes on uncompetitive markets. Netflix also was quick to highlight how caps can be used anti-competitively against streaming video providers, something the FCC opened the door to when it decided to turn a blind eye to the practice of zero rating (or exempting your own or a paid partners' content from counting against the cap). As such, Netflix urged the FCC to finally crack down on usage caps using its authority under Section 706 of the Telecom Act.

Apparently worried the FCC might take Netflix advice seriously (there's zero indication of such), a cable broadband ISP named Mediacom filed its own complaint with the FCC trying to defend the practice. Mediacom, which imposes usage caps as low as 200 GB on its users, tries to complain that criticizing ISPs for imposing caps is hypocritical...because Netflix charges different tiers of service for higher quality content and more streams:

"Ironically, those who think ISPs are greedy pigs or evil villains because they charge based on consumption through caps or usage-based pricing do not direct the same moral outrage toward edge providers who price their services in basically the same way. Netflix, for example, charges $7.99 a month for its “basic” subscription. A basic subscriber does not get unlimited usage of Netflix’s library for that price but, instead, is limited to videos in standard definition format and on only one screen at a time."

Of course, Mediacom knows it's comparing rotten apples to oranges. In broadband, users have no competitive options, so if an ISP (or both of the duopoly ISPs in a market) imposes usage caps, a consumer can't vote with their wallet. In contrast, users frustrated by Netflix's practice of charging more money for HD (or 4K) streams can just go get content from another streaming or traditional cable TV provider.

But this type of ill-suited comparison is trotted out again and again in the FCC filing, with the ISP going so far as to compare broadband service to game consoles, video games, socks, and cloud storage. Ultimately the core of the ISP's astonishingly flimsy argument leans heavily on Starbucks coffee and...Oreos:

"Imagine you are out for a walk and experience a sudden, irresistible craving for Oreo® cookies. You only want to spend two dollars, which means that you will be able to buy a two-pack or maybe even a four-pack but for sure you cannot get the family size of over 40 cookies. For that many, you have to spend more. Of course, it would be nice if your two dollars bought you the right to eat an unlimited number of cookies, but you know that is not the way our economy works. It is the same for the Starbucks latte you might want to drink with your cookies and for socks, gasoline and just about every single one of the thousands of other products and services that are for sale in the United States, including essentials like water and electricity."

Again that's so misleading as to be insulting. Consumers have a myriad of competitive options for both coffee and cookies, whereas Mediacom is very often the only ISP available to its customers. It's that lack of competition that encourages ISPs to begin charging more money for the same money via caps and overage schemes where -- unlike utility markets -- nobody confirms usage meters are accurate. As for how the economy actually works in broadband: incumbent ISPs buy state legislatures and federal regulators to ensure nobody lifts a finger as they price gouge the living hell out of a captive subscriber base.

You know, just like the damn lederhosen industry.

Filed Under: business models, choice, data caps, fcc, oreos, usage caps
Companies: mediacom, netflix

Lots Of Newspapers Discovering That Paywalls Don't Work

from the shocking,-there dept

For many years, while some journalists (and newspaper execs) have been insisting that a paywall is "the answer" for the declining news business, we've been pointing out how fundamentally stupid paywalls are for the news. Without going into all of the arguments again, the short version is this: the business of newspapers has never really been "the news business" (no matter how much they insist otherwise). It's always been the community and attention business. And in the past they were able to command such attention and build a community around news because they didn't have much competition. But the competitive landscape for community and attention has changed (massively) thanks to the internet. And putting up a paywall makes it worse. In most cases, it's limiting the ability of these newspapers to build communities or get attention, and actively pushing people away.

And, yes, sure, people will point to the NY Times, the Wall Street Journal and the Financial Times as proof that "paywalls work." But earth to basically every other publication: you're not one of those publications. The paywalls there only work because of the unique content they have, and even then they don't work as well as most people think.

Not surprisingly, more and more newspapers that bet on paywalls are discovering that they don't really work that well and were a waste of time and effort -- and may have driven away even more readers.

Of the paywalls erected in the past few years, many have delivered lackluster results, said Ken Doctor, a media consultant who writes the blog Newsonomics.

"The ones that were launched in 2012 to 2014 had good early results and they all largely stalled," he said.

"They are no longer gaining much in the way of new digital subscriptions, and their print is in rapid decline."

The article also quotes Alan Mutter who has been pointing out the fallacies around newspaper paywalls for probably longer than I have:

Paywalls can backfire also "because they put a barrier between the newspaper and the casual reader," he added.

"They are truncating the size of the digital market, when the most important factor for digital is scale."

Meanwhile, as newspapers are realizing this, even the "successful" paywall folks at the Wall Street Journal appear to be changing up its paywall to make it easier for non-paying users to read the articles.

This doesn't mean that you can't get money from readers -- but paywalls are a stupid way to do it. You're asking them to pay for the same kind of value that they can often get elsewhere. That's dumb. If you're charging, you should be charging for unique value and something different that only your publication can provide. General interest news is not that.

Filed Under: business models, community, journalism, news, newspapers, paywalls

Newspaper Association Of America Complains That Comedian John Oliver Failed To Solve Newspaper Biz Model Problem

from the maybe-your-priorities-are-a-little-off dept

You may have seen that on Sunday, John Oliver's main bit this week was about the collapse of the local newspaper business. It's a pretty typical John Oliver piece -- and definitely on a topic that we've discussed many times in the past -- media business models. However, we didn't see much of a need to write about it... until the Newspaper Association of America decided to whine about it, mainly complaining that Oliver (1) didn't offer any solutions and (2) mocked companies that are trying, no matter how ridiculous their efforts are:

However, other than encouraging people to "pay for" more news, he doesn't offer any answers. More particularly, he spends most of the piece making fun of publishers who are just trying to figure it out. Whatever you think of the name "tronc" and that company's announced growth strategy, at least they are trying new things and trying to figure out how to create great news journalism in the digital era. John Oliver doesn't seem to have any better ideas.

The fact is that we are in a transitional phase within the entire industry. People want, need and consume more hard news than they ever have. The core demand for the product isn't decreasing at all, and based upon that we will find our way to the far shore where the industry is thriving and growing once again. But in the meantime, there is going to be a lot of experimentation and evaluation of new business models. Some experiments will work and some won't, and our VP of Innovation, Michael MaLoon is committed to keeping you up-to-date on what is happening on that front. But making fun of experiments and pining away for days when classified ads and near-monopolistic positions in local ad markets funded journalism is pointless and ultimately harmful.

I would just ask Mr. Oliver to spend more time talking about what the future of news could be, and less time poking fun at publishers who are trying to get there.

This is pretty ridiculous. First of all, much of the mocking was over the Tribune Company's ridiculous rebranding as "tronc," and specifically the absolutely ridiculous "tronc employee video" the company put together, that I still am partially convinced is a parody of the kind of idiocy big newspapers put out these days to pretend they get technology. "Artificial intelligence!" "The future of journalism!" "Tech startup culture!" "Evolving, changing -- the fun part!" "Optimization group!" "Feed it into a funnel and then optimize it!" "Maximize all the time." "Monetize video!" "The role of tronc is to transform journalism -- from pixels to Pulitzers." I mean, the video is inherently mockable. It's cringeworthy bad. I would have been disappointed if Oliver hadn't included it in his story. It's that bad.

And, really, despite the fact that we -- among many others -- have argued that Oliver and his team do real journalism at times -- at its core, his show is about comedy. Of course he's going to mock stupid stuff. Why shouldn't he? Expecting him to offer a "solution" is pretty silly. Whining about a comedian making fun of your failures to actually truly evolve seems like it should be fairly low down on the list of things the NAA should be focused on these days. If it's looking to comedians for solutions, and complaining when they don't provide any, perhaps the NAA itself should be spending a bit more time exploring how its members can evolve and adapt.

Filed Under: business models, complaints, john oliver, newspapers
Companies: naa, newspaper association of america

China's Home-Grown Version Of Spotify Shows How To Make Money In A World Of Digital Abundance

from the removing-obstacles dept

The fact that the best-known music streaming service, Spotify, is still struggling to turn a profit despite its huge popularity, is often held up as proof that making money in a world of digital abundance is almost impossible. Of course, here on Techdirt, we've published many posts about people and companies that have adopted various innovative strategies to get around the problem. But what about music streaming as a mass medium: will it ever be possible to make money in this sector?

A fascinating article on Mashable shows that it is already happening, but perhaps not where most people are looking. QQ Music is part of the extensive digital empire of the Chinese giant Tencent, best known for its messaging app WeChat, and now the largest Internet company in Asia. Last year, its turnover was $15.8 billion (pdf). As the Mashable article explains, QQ Music's general manager revealed last week that the service is now profitable. One reason is the sheer scale of Tencent's user base:

As one of China's biggest dotcoms -- WeChat has 762 million active users -- the company has far better negotiating power at the table with record labels. Back in 2014, Tencent already used this to its advantage, striking exclusive Chinese distribution deals with large music producers the likes of Sony, Warner Music and South Korea's YG Entertainment.

Similarly, QQ Music is itself large compared to Spotify:

QQ Music reports 100 million daily active users, and 400 million monthly actives.

Spotify, in comparison, has about 100 million monthly actives, although it has 30 million paying subscribers -- three times QQ's 10 million paying subscribers.

The secret to QQ Music's profitability seems to be the following:

Chinese analyst iResearch estimates that over half of [QQ Music's] users in China would have paid for something on their music apps this year. That could be a one-off purchase like an album or concert tickets, even if it's not an ongoing subscription.

Moreover, beyond the 57% that already buy ancillary items, a further 20% said they were willing to do so at some point. That means over three-quarters of QQ Music's users have or will buy other goods. Crucially, Tencent makes that as easy as possible by offering its own payment system as standard. That emphasizes a key point about making money in a world of digital abundance: success flows from removing as many barriers as possible, so that people can pay you for things they want at the moment they want them.

Follow me @glynmoody on Twitter or identi.ca, and +glynmoody on Google+

Filed Under: abundance, add-ons, business models, china, music industry, streaming
Companies: qq music, spotify, tencent, wechat

Newspaper Association Thinks FTC Should Force Readers To Be Subject To Godawful Ads And Invasive Trackers

from the please-let-us-continue-to-screw-our-audience dept

So, it's come to this. After battling back against ad-blocking by guilting or forcing people into whitelisting sites -- rather than taking a good look at their terrible ad inventories, intrusive trackers, or reprehensible practices -- the press is turning to the FTC in hopes of having the government decide how you can surf the web. (h/t EFF)

The crux of the complaint [PDF] is various practices deployed by ad blockers that the Newspaper Association of America (NAA) considers to be anti-competitive or dishonest. But in its run-up to the actual complaints, the NAA makes some seriously stupid assertions.

Adblockers undermine the ability of publishers to continue to provide free or reduced-price content on the Internet because they undercut publishers’ ability to finance enterprise journalism, and they threaten the livelihood of journalists and other content creators.

This assertion continues to scapegoat ad blocking for many publications' decision to force readers to play "find the content" when visiting their sites. As user ad blindness eventually rendered banner ads invisible, the response has been to escalate intrusion, via new ad delivery methods like popunder/popups, autoplay video ads, pervasive trackers, or escalating encroachment of ads into the "content" area. If ad blocker usage is more prevalent, publishers really have no one but themselves to blame.

And there's nothing out there that suggests the only way a publication can remain profitable is by assaulting users with ads and tracking them all over the internet. But that's the narrative publishers have chosen because it's simpler to make users conform to their wishes than it is to cede ground to site visitors' best interests.

From there, the NAA's narrative gets even worse. In deriding "free-rider technology," the NAA defends its use of invasive trackers by implying that all content -- whether it's ads or the stuff site visitors actually want to see -- is equal in its eyes.

By preventing publishers from identifying repeat visitors and making these offers to them, content blockers harm consumers.

"Content blockers." If that's a slip, it's a Freudian one. This suggests those behind this letter to the FTC consider advertising to be just as worthwhile a use of bandwidth and user attention as the actual journalism buried underneath it.

In the NAA's eyes, the real villain here is "deceptive" ad blockers.

Ad-blocking companies argue that consumers should use their software to “opt out” of the online advertising ecosystem, either because of concerns with privacy or the data use represented by digital advertising. But as a review of the practices of adblocking companies discloses, consumers do not “opt out” of an ecosystem by using ad-blockers. Instead, they “opt in” to a deceptive new environment that does not adequately disclose its practices to consumers.

The supposed "deception" the NAA refers to is things like AdBlock Plus selling companies spaces on its "whitelist." Then it has the audacity to make claims about the darkish shade of ad blockers' kettles by claiming any information about these built-in whitelists is buried in the terms of service. Burial of crucial details under several pages of fine print is SOP for 99.9% of the internet -- including (especially) the same tracking software the NAA says is crucial to the survival of the industry.

The NAA also claims that evading paywalls -- if enabled by ad blockers -- is an "unfair method of competition." Considering how easy it is to evade most paywalls (via referral links, Google searches, going "incognito," etc.), it seems rather disingenuous to claim the automation of this process is somehow a violation of trade laws. For that matter, the complaint offers no proof that any popular ad-blocking extension actually offers this "service." (There are extensions written solely for that purpose, however.)

The complaint also takes issue with "replacement" services that substitute bad ads with better ads or offer micropayments to sites in exchange for blocking their revenue generators. The NAA insists these, too, are deceptive and should be kicked of the 'net by the FTC.

But most worryingly, the NAA wants internet users to be forbidden from taking steps to protect their privacy.

Some ad-blockers evade metered subscription services and paywalls by preventing publishers from identifying repeat visitors and making offers to consumers about their subscription services…

While it doesn't specifically name any apps or extensions that act in the interest of users' privacy, the wording used implies the use of IP-address obscuring options (VPNs, Tor) along with script blockers and software like the EFF's Privacy Badger are similarly unwelcome in its plan for the future.

What the NAA wants is an internet that operates on its terms. It wants to continue to deploy shitty ad inventories and allow users to take the bandwidth hit, all the while shadowing them across the web in hopes of shoving even more ads in their faces. There's no hint of a compromise in this complaint. It wants the FCC to force the web to bend to the NAA's will. At no point does it even consider the ramifications of this action. It's pure self-interest, disguised as a concern for poor consumers who have voted to opt-out of ad onslaughts by using "deceptive" ad blockers.

Filed Under: ad blockers, ads, business models, felony interference with a business model, ftc, newspapers, privacy, tracking
Companies: naa, newspapers association of america

Cops Getting Free License Plate Readers In Exchange For 25% Of The 'Take' And All The Driver Data Vigilant Can Slurp

from the an-equitable-partnership dept

What happens when you lower the barriers to entry? More participants join the market. It works everywhere, even when the market is "law enforcement" and the "customers" are everyone else.

Vigilant Solutions, one of the country’s largest brokers of vehicle surveillance technology, is offering a hell of a deal to law enforcement agencies in Texas: a whole suite of automated license plate reader (ALPR) equipment and access to the company’s massive databases and analytical tools—and it won’t cost the agency a dime.

[...]

Vigilant is leveraging H.B. 121, a new Texas law passed in 2015 that allows officers to install credit and debit card readers in their patrol vehicles to take payment on the spot for unpaid court fines, also known as capias warrants. When the law passed, Texas legislators argued that not only would it help local government with their budgets, it would also benefit the public and police.

Well, we can see how this will benefit law enforcement and others on the government food chain, but it's unclear how this will benefit the public. The bill's sponsor said the law would "relieve the burden" of having their vehicles impounded or being jailed for unpaid fines. But beyond those vague perks, the benefits seem to flow mostly in one direction.

The EFF quotes legal blogger Scott Henson of Grits for Breakfast, who speculated the combination of license plate readers and credit card readers would push cops towards chasing down unpaid fines rather than enforcing traffic laws or performing more routine patrol duties. If so -- and it appears to be the case -- this is exactly the outcome Vigilant was expecting. It didn't hand out its tech for free. There may be no price tag on the plate readers at the point of purchase, but that's only because Vigilant has points on the back end.

The “warrant redemption” program works like this. The agency gets no-cost license plate readers as well as free access to LEARN-NVLS, the ALPR data system Vigilant says contains more than 2.8-billion plate scans and is growing by more than 70 million scans a month. This also includes a wide variety of analytical and predictive software tools.

The government agency in turn gives Vigilant access to information about all its outstanding court fees, which the company then turns into a hot list to feed into the free ALPR systems. As police cars patrol the city, they ping on license plates associated with the fees. The officer then pulls the driver over and offers them a devil’s bargain: go to jail, or pay the original fine with an extra 25% processing fee tacked on, all of which goes to Vigilant.

To make this relationship even more explicit, officers who issue tickets to parked vehicles rather than drivers leave a note instructing them to visit Vigilant's website to pay the fine. On top of the 25% fee, Vigilant also gets to collect massive amounts of sweet, sweet driver data, which it can then sell to other law enforcement agencies (database access licenses) and private firms (insurance companies, repo men, etc.). And, if the locals seem understaffed, Vigilant is more than happy to pick up the slack.

In early December 2015, Vigilant issued a press release bragging that Guadalupe County had used the systems to collect on more than 4,500 warrants between April and December 2015. In January 2016, the City of Kyle signed an identical deal with Vigilant. Soon after, Guadalupe County upgraded the contract to allow Vigilant to dispatch its own contractors to collect on capias warrants.

As the EFF points out, this freemium service benefits Vigilant and law enforcement, but does very little for the general public… including protect them from Vigilant's inability to perform its job competently.

During the second week of December, as part of its Warrant Redemption Program, Vigilant Solutions sent several warrant notices – on behalf of our law enforcement partners – in error to citizens across the state of Texas. A technical error caused us to send warrant notices to the wrong recipients.

These types of mistakes are not acceptable and we deeply apologize to those who received the warrant correspondence in error and to our law enforcement customers.

Apologies are nice, if of limited utility, but…

[T]he company has not disclosed the extent of the error, how many people were affected, how much money was collected that shouldn’t have been, and what it’s doing to inform and make it up to the people affected.

As has been discussed here before, turning law enforcement agencies into revenue-focused entities is a bad idea. Case in point: asset forfeiture. Further case in point: speed trap towns. Improper incentives lead to improper behavior. Agencies may like the idea of a "free" license plate reader, but the price still has to be paid by someone -- and that "someone" is going to be the general public.

As priorities shift towards ensuring ongoing use of the "free" ALPRs, other criminal activity is likely to receive less law enforcement attention. Unpaid fines and fees are in law enforcement's wheelhouse, but should never become its raison d'etre. Once it does, the whole community suffers. Anything that could be implemented to lower crime rates would also serve to lower revenue, making it far less likely to be implemented. Fewer infractions mean fewer opportunities to collect court fees. And while the legislators pushing the new law Vigilant is leveraging talked a good game about sending fewer people to overcrowded jails, the governments overseeing these agencies still have budgets to meet and law enforcement to lean on to ensure this happens. Actually achieving the bill's stated aims would mean a steady reduction in court fees, which would lead to the loss of "free" plate readers. And no one wants that, at least not on the government side of things.

Filed Under: alpr, business models, law enforcement, license plate readers, license plates, police, texas, ticketing
Companies: vigilant solutions

No, The Internet Hasn't Destroyed Quality Music Either

from the panic-panic-everywhere dept

At what point will the music industry stop crying wolf? Remember that part of the reason behind the 1909 Copyright Act in the US was the arrival of the player piano, which some feared would put musicians out of business. Same with the phonograph. Remember, John Philip Sousa told Congress in 1906 how those darned "talking machines" were going to stop people from singing:

These talking machines are going to ruin the artistic development of music in this country. When I was a boy--I was a boy in this town--in front of every house in the summer evenings you would find young people together singing the songs of the day or the old songs. Today you hear these infernal machines going night and day. We will not have a vocal chord left. The vocal chords will be eliminated by a process of evolution, as was the tail of man when he came from the ape. The vocal chords will go because no one will have a chance to sing, the phonograph supplying a mechanical imitation of the voice, accompaniment, and effort.

And, of course, basically every other technological innovation was a threat of some sort. The radio was supposed to kill music. "Home taping is killing music" was a slogan! The RIAA undermined digital tapes and tried to limit CDs. It sued over the earliest MP3 players. It's sued countless internet companies and even music fans.

Through it all, the refrain is always the same: if we don't do this, "music will go away."

But, of course, throughout it all, music only expanded. In the first decade of the 21st Century, more music was recorded than all of history combined, and it's likely the pace has increased over the following five years as well.

And because of that, we've started to hear a new refrain from the same folks who insisted before that music was at risk of "dying" because of new technologies: that maybe there's more music, but it's clearly worse in quality. Some of this can be chalked up to the ridiculous pretension of adults who insist that the music of their youth was always so much better than the music "the kids listen to nowadays." But plenty of it seems to be just an attack on the fact that technology has allowed the riff raff in, and the big record labels no longer get to act as a gatekeeper to block them out.

However, as pointed out in an article in The Age down in Australia, not only is music doing phenomenally well these days, but a recent study suggested that the quality of music continues to increase as well. Now, obviously, quality is a subjective thing, so it's difficult to "measure," but here's what the report noted:

Yet all these years on we are still surrounded by music. It follows us throughout a day from our bedside to our commutes to our earphones at work to our drive home to settling into bed.

And an astonishing amount of it is new. A decade after the arrival of file sharing, US economist Joel Waldfogel charted what had happened in a paper called Bye, Bye, Miss American Pie? The Supply of New Recorded Music since Napster.

There is no doubt that recording companies are making less money since file sharing, he says. But that doesn't necessarily mean they are making less music, or even less good music.

Assembling data on the quality of songs from the "all-time best" lists compiled each year by Rolling Stone and other magazines he finds that the albums regarded as good tend to be recent, and increasingly so as the internet age wears on.

The good new ones aren't even by old artists. He says around half of the good new albums are by artists who only started recording since file sharing. It has neither killed new music, nor frightened people away from beginning to make music.

Now, there are reasonable quibbles with this methodology. You can say that of course newer lists of "all time" best music will weigh heavily more recent favorites, even if they might not truly last the tests of time. But, at the very least it does suggest that plenty of people (myself included) are still finding a ton of new music to listen to that we find to be just as good, if not better, than music from decades ago.

Filed Under: business models, internet, music, predictions, quality, streaming

David Bowie Wasn't Just An Incredible Music Visionary, But An Internet & Business Model Visionary Too

from the rip dept

As I'm sure you've heard by now, famed musician David Bowie passed away yesterday at age 69 due to cancer. As someone who influenced so many people in so many different ways, it's great to see basically everyone celebrating his life and his music. But, given that this is Techdirt, I also thought that Bowie deserved a shoutout on topics that we discuss around here as well: Bowie wasn't just an amazing music visionary, but he was similarly visionary about the music business and the internet as well.

All the way back in 1996, he was the first major musician to release music only on the internet, launching the single for "Telling Lies" as a direct download off of his website, and announcing it in an online chat session. Yes, nearly 20 years ago, Bowie embraced internet distribution for his music.

Then, in 1997, he went way beyond basically any other music business model experiment by issuing Bowie Bonds, creating a financial instrument that was backed by the royalties from his music, without losing control of the actual music itself.

That same year, he also became the first major musician to "cybercast" a live concert online. Other musicians had tried similar things around that time, but Bowie was by far the most well-known (though the technology basically sucked for all of them, including Bowie).

Just a year later, in 1998, David Bowie launched BowieNet, his very own internet service provider (ISP), saying:

If I was 19 again, I’d bypass music and go right to the internet.

Again, that was 1998 -- the same year that Google was founded (and a little site called Techdirt first came online too, but we'll leave that aside for now).

By 2000, he was already talking about just how revolutionary the internet was going to be for music: There's so much good stuff in that interview. He talks about how he doesn't view himself in the music industry at all any more because of the way the industry works, and how much he just wants to do his own thing. And the internet is incredibly exciting to him. He talks about how he got into music because it was a rebellious thing to do, but then:

It had a sort of 'call to arms' feeling to it. This is the thing that will change things. It is a dead-dodgy occupation to have. It still produced signs of horror from people if you said 'I'm in rock and roll.'... Now it's a career opportunity. And the internet carries the flag of being subversive and possibly rebellious and chaotic and nihilistic.... Forget about the Microsoft element. The monopolies do not have a monopoly....

... I like the idea that there's a demystification process going on between the artist and the audience....

... I don't think we've even seen the tip of the iceberg. I think what the internet is going to do to society -- both good and bad -- is unimaginable. I think we're on the cusp of something exhilarating and terrifying....

... The actual context and the state of content is going to be so different to anything we can envisage at the moment – the interplay between the user and the provider will be so in simpatico it's going to crush our ideas of what mediums are all about.

... Artists like Duchamp were so prescient here – the idea that the piece of work is not finished until the audience comes to it and adds their own interpretation, and what the piece of art is about is the grey space in the middle. That grey space in the middle is what the 21st century is going to be all about.

That same year, Bowie also launched BowieBanc, an online banking operation, that offered ATM cards and checks (with Bowie's image on them), exploring new ways of connecting with fans and building his own brand online.

Given all this, it's hardly surprising that in 2002, he gave an interview to the NY Times in which he predicted the end of copyright altogether, as well as record labels, as they would no longer serve a useful purpose:

His deal with Sony is a short-term one while he gets his label started and watches the Internet's effect on careers. ''I don't even know why I would want to be on a label in a few years, because I don't think it's going to work by labels and by distribution systems in the same way,'' he said. ''The absolute transformation of everything that we ever thought about music will take place within 10 years, and nothing is going to be able to stop it. I see absolutely no point in pretending that it's not going to happen. I'm fully confident that copyright, for instance, will no longer exist in 10 years, and authorship and intellectual property is in for such a bashing.''

''Music itself is going to become like running water or electricity,'' he added. ''So it's like, just take advantage of these last few years because none of this is ever going to happen again. You'd better be prepared for doing a lot of touring because that's really the only unique situation that's going to be left. It's terribly exciting. But on the other hand it doesn't matter if you think it's exciting or not; it's what's going to happen.''

It hasn't totally played out the way he expected, but there's no doubt that Bowie's ability to be a visionary wasn't merely limited to the incredible music he wrote, performed and recorded, but to the internet and music/internet business models as well.

Filed Under: business models, copyright, david bowie, internet, music

Video Game Industry Embraces Internet And New Business Models: Others Should Pay Attention

from the game-theory dept

We talk a great deal around these parts about new business models at both the macro and micro level. Individual experiments and successes, as well as failures, are both interesting and instructive, but a good macro-level look at how entire industries can function in a digital marketplace should be equally useful. With that in mind, Chris Dixon has an absolute must-read post on Medium on the lessons other industries can learn from the PC gaming industry's success in recent times.

It's worth noting before we start here that the past five years or so have been chock-full of hand-wringing over every potential danger to the PC gaming industry you could imagine, from casual mobile games to piracy. And, to some extent, I can understand that fear. After all, PC gaming has perhaps lower barriers to entry than other entertainment mediums, making competition more heavy, while the average consumer of PC games is likely going to be more familiar with the ways of piracy and the technical workarounds to DRM than the average music or movie consumer. Too bad for all that fear that, as Dixon's article notes, the PC gaming industry has enjoyed healthy growth over these past several years (something like 50% revenue growth since 2012). Much of that has to do with the innovative ways gaming companies have found to do business.

Even if you have no interest in video games, if you are interested in media, you should be interested in PC gaming. Over the past decade, PC gaming has, for a variety of reasons, become a hotbed of experimentation. These experiments have resulted in a new practices and business models — some of them surprising and counterintuitive — that provide valuable lessons for the rest of the media industry.

Those experiments will sound quite familiar to the Techdirt reader. They include free-to-play models, with game extras being sold to gamers. They also include the development of strong and convenient selling platforms, like Steam and GOG.com. The so-called "freemium" model is particularly well done in PC games, in part because many of those games respect gamers enough not to use the model to break the integrity of the game itself.

The PC gaming world has taken the freemium model to the extreme. In contrast to smartphone games like Candy Crush that are “free-to-play,” PC games like Dota 2 are “free-to-win.” You can’t spend money to get better at the game — that would be seen as corrupting the spirit of fair competition. (PC gamers, like South Park, generally view the smartphone gaming business model as cynical and manipulative). The things you can buy are mostly cosmetic, like new outfits for your characters or new background soundtracks. League of Legends (the most popular PC game not on Steam) is estimated to have made over $1B last year selling these kinds of cosmetic items.

Medium also goes on to point out PC gaming's latest foray into money-making in the form of live events. In what will sound familiar to anyone who has read our posts about the music industry, live gaming events are fantastic revenue generators, especially as they've become massively popular in the past few years.

Add to all of this the relatively permissive attitude in PC gaming circles that companies have towards mods of their games and you have a recipe for violent adoption and the willingness to buy by the gaming public. Mods make games more attractive to wider audiences, increasing purchases. Some mods indeed become their own games, increasing purchases. Most game companies encourage this modding culture, generating good-will within the consumer-base. No other industry does this as well.

Contrast this to the music industry, which relies on litigation to aggressively stifle remixing and experimentation. Large music labels have effectively become law firms devoted to protecting their back catalog. Sometimes this means suing their peers, and sometimes this means suing communities of users. The end result is a strong chilling effect on new experiments. Almost all new music-related tech products are minor variations of preceding products. It’s too risky and expensive to try something genuinely new.

And finally, there is the embrace of crowd-funding. Crowd-funding has been adopted in virtually all entertainment mediums, but I struggle to see any of them doing crowd-funding as well as the PC gaming industry. From experiments done by household PC gaming names like Tim Schafer, to diverse tiered-rewards for funding, to the willingness of some to forego offers from traditional game publishers to go the crowd-funding route, PC gaming is full of these success stories.

The point of all this is that new and innovative business models can work for other industries as well. There's nothing unique about the PC gaming industry that won't translate over to some degree for music, movies, television, etc. They just have to try.

Filed Under: business models, copyright, internet, video games