Executive Order 12333 Documents Redefine 'Collection,' Authorize Majority Of Dragnet Surveillance Programs

from the also:-no-oversight dept

Issued in 1981, updated in 1991 (to consolidate power, basically) and continuously expanded (mostly unofficially) since 2001, Executive Order 12333 (EO 12333) is what grants surveillance powers to our nation's intelligence agencies.

Foreshadowing the severe twisting of the English language that follows (see also: NSA-to-English dictionary), the opening paragraphs note that what certain wording sounds like isn't actually what it means. [pdf link]

In spite of the constraining appearance of all the requirements, under E.O. 12333, DoD Directive 5240 .IR, and DIAR 60-4, intelligence activities conducted by the DHS currently have much more latitude and potential for effectiveness than they have had for quite some time.

Looks like "constraints" but in practice is hardly anything at all.

Covert and clandestine operations ("Special Activities") -- normally limited to the CIA -- are now something any agency can participate in, if given permission to.

The meaning of the proscription is not that intelligence components are prohibited from conducting all Special Activities; rather, that such activities must be directed by the President and approved by the Secretary of Defense and the respective Service Secretary.

Going on from there, we see the first public instance of the government's redefinition of the word "collection."

Procedure 2 introduces the reader of DoD 5240.1-R to his or her first entry into the "maze" of the regulation. To begin the journey, it is necessary to stop first and adjust your vocabulary. The terms and words used in DoD 5240.1-R have very specific meanings, and it is often the case that one can be led astray by relying on the generic or commonly understood definition of a particular word.

For example, "collection of information" is defined in the Dictionary of the United States Army Terms (AR 31011 25) as: The process of gathering information for all available sources and agencies. But, for the purposes of DoD 5240.1-R, information is "collected" -... only when it has been received for use by an employee of a DoD intelligence component in the course of his official duties ... (and) an employee takes some affirmative action that demonstrates an intent to use or retain the information.

"Collection" is now defined as "collection plus action," rather than the way it's been defined for hundreds of years. "Information held" is not a "collection," according to this document. It still isn't collected, even if its been gathered, packaged and sent to a "supervisory authority." No collection happens until examination. It's Schroedinger's data, neither collected nor uncollected until the "box" has been opened. This leads to the question of aging off collected data/communications: if certain (non) collections haven't been examined at the end of the 5-year storage limit, are they allowed to be retained simply because they haven't officially been collected yet? Does the timer start when the "box" is opened or when the "box" is filled?

Also of note: "incidental" collections are not collections if utilizing the same mental gymnastics.

If the information is not essential to the mission of the component and it does not fit into one of those categories, then that information may not be collected. However, you will recall from our discussion in paragraph 3 -7 that "collection" means receiving plus an affirmative act to use or retain the information. Therefore, mere receipt of non-essential information does not constitute a violation of DoD 5240.1-R.

More redefining is done here:

Once again, we must cautiously examine the vocabulary used in DoD 5240.1-R. The term "retention" means more than merely retaining information in files - it is retention plus retrievability. As stated in DoD 5240.1-R -... the term retention as used in this procedure, refers only to the maintenance of information about United States persons which can be retrieved by reference to the person's name or other identifying data.

Somewhat more positively, this section instructs analysts to a very limited view of "retrievability" and err on the side of "purging" information on US persons that cannot legally be retrieved, even if it was legally "collected" (using the DoD's expanded definition). It does, however, hedge by noting information "necessary to ongoing missions" should be retained.

The document goes on to applaud the FISA court for being instrumental in protecting citizens' rights… apparently by eliminating legal barriers to domestic surveillance.

The [Senate Select] Committee has reviewed the five years of experience with FISA and finds that the Act has achieved its principal objectives. Legal uncertainties that had previously inhibited legitimate electronic surveillance were resolved, and the result was enhancement of U.S. intelligence capabilities. At the same time, the Act has contributed directly to the protection of the constitutional rights and privacy interests of U.S. persons.

There's a lot of information in there, very little of it redacted, but until the ACLU liberated it, completely withheld from the public. The question is, why? Despite the many paragraphs given over to rewriting the English language to better suit intelligence agencies' aims, there's also a lot of very blunt statements made about the balance between the government's counterterrorism efforts and the rights of US citizens.

The ACLU highlights this particular section in its write up of the released documents.

This area of DoD intelligence activities, that is, the use of special collection techniques, is the area in which there tends to be the greatest amount of confusion regarding the limitations on permissible activities. Because of this confusion, this area also tends to be the most fertile ground for both abuse and unnecessarily restrictive interpretation of the rules. To be sure, it is fundamental that abuse of the legitimate DoD intelligence and counterintelligence resources and authority must be avoided. The rights of US persons must also be protected, and no intrusion into these protected areas is permissible without first meeting constitutional standards, and then only through a system of careful scrutiny of the intruding apparatus.

This is spelled out more explicitly later, reminding those entering the intelligence world that the job is necessarily difficult -- a fact many of those in the intelligence and law enforcement fields forget all too quickly.

The system is complex, but it is not impossible. Its underlying structure is designed to balance the legitimate needs of the government with the rights of the individual. Given those constraints, one could not expect a system to exist which did not inherently contain adequate checks, balances, and oversight procedures.

This is miles away from the DOJ's statements that cell phone search warrant requirements make it too difficult to capture criminals, a refrain now being echoed by law enforcement agencies in response to automatic encryption on iPhones and Android devices.

These are the limits these entities must adhere to. These are built-in as a check against government power. But these rights are not a one-way street solely favoring the American public. The DIA guidebook discusses what the intelligence community and the administration have refused to: and it does it in plain, straightforward language.

Nevertheless, we must be mindful of too much caution. We must remember that we are engaged in a real-world mission that involves unprincipled adversaries, and a plethora of sophisticated technical collection and counter-collection enterprises and devices. Terrorism and have destruction as their common denominator, and we are fueling their malignancy when we unnecessarily restrain or restrict our foreign intelligence or counterintelligence efforts, just the same as we would damage the fiber of our democracy through abusive use of our own capabilities and powers.

Our business is one that involves constant vigilance and omnipresent balancing of competing interests. To survive, we must take risks. To succeed, we must minimize those risks. To preserve our precious ideals, we must carefully pursue our crafts in such a manner as to not offer up the rights and dignity of our citizens in exchange for that success.

As the ACLU points out, this frank discussion of the tension between the two is a far cry from the usual "dissembling and obfuscation" the government has provided so far in its tepid responses to leaked documents. This willingness to discuss the balance in real terms may be part of the reasons a lawsuit was needed to free the document.

The other, larger issue, is that this order may be the main justification for most of the NSA's surveillance and data dragnets -- an order not subject to any form of oversight.

Because the executive branch issued and now implements the executive order all on its own, the programs operating under the order are subject to essentially no oversight from Congress or the courts. That's why uncovering the government's secret interpretations of the order is so important. We've already seen that the NSA has taken a "collect it all" mentality even with the authorities that are overseen by Congress and the courts. If that history is any lesson, we should expect — and, indeed, we have seen glimpses of — even more out-of-control spying under EO 12333.

For all of the tough talk about respecting the public's rights, a vast amount of surveillance occurs under this order. In the document, any questions about overriding civil liberties concerns are directed towards members of the Executive branch, rather than to anywhere that might act as a check against its powers -- like courts or the legislative branch. In fact, the legislative branch has done nothing but expand its powers of the last 30+ years. So, new analysts might hear plenty about the importance of respecting civil liberties, but they'll find that in practice, those words -- like "retention" and "collection" mean next to nothing.

Filed Under: collections, definitions, dragnet, eo 12333, executive order 12333, nsa, privacy, surveillance

NSA Insisted Snowden Didn't Have Access To Actual Surveillance Data: But He Did... And It Shows How Much Non-Terrorist Content NSA Collects

from the lying-liars dept

Just a few days ago, the Privacy and Civil Liberties Oversight Board (PCLOB) more or less gave a pass to the Section 702 surveillance program by the NSA (approved by Section 702 of the FISA Amendments Act). This is the program that combines PRISM (basically court orders to internet companies for content) and Upstream (tapping fiber backbone to sniff basically all traffic) to collect communications (not just metadata) of "targets." For years, we've pointed out that the NSA defines "targets" differently than most everyone else does -- and people in the know, like Senator Ron Wyden, have been trying to warn us that the NSA defines "targets" in a manner that allows the NSA to spy on the communications of a very, very large number of innocent people. The PCLOB more or less admitted that they didn't actually see the details of what the NSA collected, but a newly analyzed trove of documents from Ed Snowden reveals the truth. While the program may actually be useful in discovering terrorist plots, it also appears to collect a ridiculous amount of data on people who clearly are not targets, and the NSA is incredibly lax about purging the database (so-called "minimization") of that unrelated information.

This latest report, written by Barton Gellman and Ashkan Soltani at the Washington Post, is important for a number of different reasons. First is that, for quite some time now, NSA insiders have insisted that while Snowden had access to papers and reports about the various surveillance programs, he never actually had access to the actual contents of the surveillance databases. That was clearly a lie. As the article notes:

As recently as May, shortly after he retired as NSA director, Gen. Keith Alexander denied that Snowden could have passed FISA content to journalists.

“He didn’t get this data,” Alexander told a New Yorker reporter. “They didn’t touch —”

“The operational data?” the reporter asked.

“They didn’t touch the FISA data,” Alexander replied. He added, “That database, he didn’t have access to.”

And, of course, Snowden-haters have regularly mocked the claim he made in his very first interview that "I, sitting at my desk, certainly had the authorities to wiretap anyone, from you, or your accountant, to a federal judge, to even the President if I had a personal email." Many had used the fact that no such "FISA data" had been revealed, or even alluded to, as proof that Snowden was talking bigger than his actual position and supposedly, as an "IT guy," he didn't really have access to the same info that analysts could access. It is now clear that those people were lying. Snowden clearly had access to that data, and gave a sample to Gellman.

Snowden said he did not need to circumvent those controls, because his final position as a contractor for Booz Allen at the NSA’s Hawaii operations center gave him “unusually broad, unescorted access to raw SIGINT [signals intelligence] under a special ‘Dual Authorities’ role,” a reference to Section 702 for domestic collection and Executive Order 12333 for collection overseas. Those credentials, he said, allowed him to search stored content — and “task” new collection — without prior approval of his search terms.

Of course, this makes it all the more concerning that the NSA has admitted it still has no idea what Snowden took. For all the talk of how carefully these programs are audited, can the NSA legitimately expect anyone to believe that others -- perhaps those with more nefarious intent -- haven't made off with the same kinds of content? The NSA (1) has admitted it doesn't know what Snowden took and (2) insisted he didn't have access to this data. Now that it's been proven he did have access to this data and gave it to journalists, it seems pretty damn clear that the NSA has no idea if anyone else took that same data as well -- or if they have been abusing the same access for more nefarious purposes (espionage, blackmail, you name it).

Meanwhile, the very same NSA attackers who insisted that Snowden didn't have access to the surveillance database have immediately ignored their old statements and now re-spun this story into how he was "reckless" in handling such sensitive data, Snowden explains that having a sample of this kind of data is incredibly important in letting the world know just how broad the 702 surveillance is:

In an interview, Snowden said “primary documents” offered the only path to a concrete debate about the costs and benefits of Section 702 surveillance. He did not favor public release of the full archive, he said, but he did not think a reporter could understand the programs “without being able to review some of that surveillance, both the justified and unjustified.”

Indeed, even for those of us who have been screaming loudly about how the NSA interpreted "target" differently than most people (including Congress) suspected, since long before Snowden leaked his documents, the detailed revelations here are eye opening about just how much information the NSA actually collects based on "targets."

Nine of 10 account holders... were not the intended surveillance targets but were caught in a net the agency had cast for somebody else.

Many of them were Americans. Nearly half of the surveillance files, a strikingly high proportion, contained names, e-mail addresses or other details that the NSA marked as belonging to U.S. citizens or residents. NSA analysts masked, or “minimized,” more than 65,000 such references to protect Americans’ privacy, but The Post found nearly 900 additional e-mail addresses, unmasked in the files, that could be strongly linked to U.S. citizens or U.S.residents.

And, frequently, the information that the NSA retained on clearly non-targeted individuals was quite revealing. Remember that this is the actual content of communications, not "just metadata" (that's a different program).

Many other files, described as useless by the analysts but nonetheless retained, have a startlingly intimate, even voyeuristic quality. They tell stories of love and heartbreak, illicit sexual liaisons, mental-health crises, political and religious conversions, financial anxieties and disappointed hopes. The daily lives of more than 10,000 account holders who were not targeted are catalogued and recorded nevertheless.

[....]

Scores of pictures show infants and toddlers in bathtubs, on swings, sprawled on their backs and kissed by their mothers. In some photos, men show off their physiques. In others, women model lingerie, leaning suggestively into a webcam or striking risque poses in shorts and bikini tops.

This sample cache shows pretty clearly that anything even remotely close to a loosely defined "target" (which could be a computer rather than a person) gets collected and stored:

If a target entered an online chat room, the NSA collected the words and identities of every person who posted there, regardless of subject, as well as every person who simply “lurked,” reading passively what other people wrote.

“1 target, 38 others on there,” one analyst wrote. She collected data on them all.

In other cases, the NSA designated as its target the Internet protocol, or IP, address of a computer server used by hundreds of people.

You may recall that, all the way back in 2011, we were reporting on Senators Ron Wyden and Mark Udall asking James Clapper how many Americans were being spied upon under Section 702 of the FISA Amendments Act and being told it was impossible to estimate such a number. Here, Gellman and Soltani use what they've found in the cache to give the estimate that the NSA/ODNI would not:

The NSA, backed by Director of National Intelligence James R. Clapper Jr., has asserted that it is unable to make any estimate, even in classified form, of the number of Americans swept in. It is not obvious why the NSA could not offer at least a partial count, given that its analysts routinely pick out “U.S. persons” and mask their identities, in most cases, before distributing intelligence reports.

If Snowden’s sample is representative, the population under scrutiny in the PRISM and Upstream programs is far larger than the government has suggested. In a June 26 “transparency report,” the Office of the Director of National Intelligence disclosed that 89,138 people were targets of last year’s collection under FISA Section 702. At the 9-to-1 ratio of incidental collection in Snowden’s sample, the office’s figure would correspond to nearly 900,000 accounts, targeted or not, under surveillance.

The report also highlights the cavalier attitude by NSA analysts in determining what to keep and what to "minimize." Section 702 certainly gave the NSA a lot more leeway to spy on Americans, and NSA analysts are making quite a lot of use of that leeway.

In their classified internal communications, colleagues and supervisors often remind the analysts that PRISM and Upstream collection have a “lower threshold for foreignness ‘standard of proof’ ” than a traditional surveillance warrant from a FISA judge, requiring only a “reasonable belief” and not probable cause.

One analyst rests her claim that a target is foreign on the fact that his e-mails are written in a foreign language, a quality shared by tens of millions of Americans. Others are allowed to presume that anyone on the chat “buddy list” of a known foreign national is also foreign.

Basically, it appears that if an analyst can come up with any reason they can justify claiming someone is "foreign," they can use it, even if they know the person is actually a US person. And because the NSA knows they have much greater power to spy under Section 702, they often shift investigations over to put them under this authority since they can get away with more:

In an ordinary FISA surveillance application, the judge grants a warrant and requires a fresh review of probable cause — and the content of collected surveillance — every 90 days. When renewal fails, NSA and allied analysts sometimes switch to the more lenient standards of PRISM and Upstream.

“These selectors were previously under FISA warrant but the warrants have expired,” one analyst writes, requesting that surveillance resume under the looser standards of Section 702. The request was granted.

The report is quite damning in revealing two things that the NSA has tried to hide: First, Snowden clearly had widespread access to the surveillance database content, despite strong claims that he did not. Second, that the database includes a ton of information on people not "targeted" and that such information outweighs info on targets by a factor of 9 to 1.

Filed Under: collections, ed snowden, keith alexander, non-targets, non-us persons, nsa, section 702, surveillance, targets

Collections Company Named In KlearGear Lawsuit Dismissed After Reporting $3,500 Charge Was 'Erroneous'

from the perhaps-the-first-time-a-collections-agency-has-received-positive-attention dept

A little bit of good news has made its way out of the KlearGear debacle. (Quick recap: tech tchotchke store KlearGear screws up order, customer writes negative review, KlearGear bills her $3,500 for violating an extortionate "non-disparagement clause" [which wasn't even in force when it screwed up her order] and then sends that bill to collections, thus screwing up her credit record.)

Scott Michelman of Public Citizen, which is suing KlearGear on the customer's (Jen Palmer) behalf, reports that one of the defendants (Fidelity Information Corp.) has fixed its contribution to Jen Palmer's woes.

Our suit also named the debt collector Fidelity Information Corp., who by this point owned the debt. Now Fidelity has done an independent review of the case and reported to the credit agencies that the debt was erroneous. So the Palmers have a measure of relief – the KlearGear debt is off John’s credit report, finally, after 18 months. Today the Palmers voluntarily dismissed Fidelity from the lawsuit.

That's good news for the Palmers, whose credit was damaged enough by KlearGear's fraudulent tactics that it prevented them from getting a loan to purchase a new furnace when theirs broke, as well as hampering their efforts to buy a new home.

That just leaves KlearGear, which has yet to respond to the lawsuit Public Citizen filed more than two months ago. KlearGear's social media accounts remain shuttered and silent. The company, however, remains open for business, however, with whoever's behind it presumably revising future earning estimates.

Filed Under: collections, jen palmer, public citizen, review, scott michelman
Companies: fidelity information corp, kleargear

Canadian Copyright Collective Calls It A Day After 15 Years Of Failing To Make Payments To Rights Holders

from the taking-down-the-industry-from-the-inside dept

Organizations fronting for rights holders repeatedly claim to have the best interests of those they represent at heart, but in reality, their efforts are largely self-serving. Lobbying, lawsuits and the pursuit of nominal fees through legislation is expensive work. The theory is that the monies collected by these efforts will make its way to rights holders, but as we've seen time and time again, the collected funds are either dumped back into the vicious circle of lawsuits/lobbying or disbursed to those running these agencies. Very rarely do creators see any sort of payment from these efforts, and the few that do are usually making healthy incomes already (the top 5%).

Michael Geist details the decade-plus of failure of one of these agencies. The Educational Rights Collective Canada (ERCC) was formed in 1988 1998 for the sole purpose of collecting royalties for the educational copying of broadcast programs for the classroom. Fifteen years down the road, it's asking the Copyright Board of Canada to put it out of its misery.

The ERCC, which includes the CBC as a founding member, asks the Copyright Board to effectively put an end to its tariff as it admits that it has never distributed any money to rights holders and is hundreds of thousands of dollars in debt.

Fifteen years of pushing for tariffs and not a single cent was passed on to the creators. During this same period, the ERCC managed to rack up nearly $1 million in debt. Its creditors are expecting to collect no more than 5% of the outstanding debt, most of which the ERCC amassed in its quest to institute copying tariffs. Canada's new copyright bill, C-11, greatly expands the royalty-free copying educational institutes can do, eliminating the ERCC's reason to exist.

The debt will now be absorbed by its creditors and the ERCC's clientele find themselves in the same financial position they were in 15 years ago. Rights holders should be taking a long, hard look at the institutions supposedly representing their interests. Many of these continue to throw good money after bad in hopes of extracting fees for nearly every use of copyrighted material. The purpose these organizations are supposed to serve -- divesting funds to rights holders -- seems to fall very low on the list of priorities.

Filed Under: canada, collections, copyright
Companies: ercc

How Big Music Companies Are Stealing Hundreds Of Millions In Royalties From Artists

from the follow-the-bouncing-ball dept

It's no secret that various major labels and big music organizations have a history of not paying artists what they're owed under the law. We've covered plenty of examples of fancy "accounting" to avoid having to pay, such that even big stars claim they never see royalties. However, Jeff Price, over at Tunecore has uncovered what may be an even bigger scam on the publishing/songwriting side of the business, creating a giant shell game, wherein major labels are getting hundreds of millions in royalties that are owed to songwriters, but are never paid.

The details are quite complex. Jeff's post has all the details, but let's just focus in on one key part of it. Basically, outside the US, digital music services need to pay two separate licenses to US songwriters -- one for reproduction rights and one for public performance rights (we won't get into why there are two separate rights and how they collided back together in digital music, as that's a different rant for a different day). However, almost no one actually buys both licenses. Typically they just get one (the reproduction right, as provided as a compulsory rate via ASCAP/BMI/SESAC) which they then pay through a local collection society. Technically, that means digital music services outside the US need to directly negotiate deals with US songwriters for the public performance right. But they don't do that.

Instead, they just pretend that the reproduction license they have covers it. And then, the local collection society arbitrarily split the reproduction license into components, pretending some of it is for the ASCAP/BMI/SESAC and some of it is for the public performance license... even if no such license has been secured (as it rarely is). Then, to make it even crazier, the local collection society skims its own take off the top for administration (despite having no right to the money in the first place) and then passes the money on... to the major labels. Jeff lays out an example:

You are a member of ASCAP, BMI or SESAC. These three organizations are in a relationship with other performance rights organizations around the world to collect and pass back and forth Public Performance royalties.

Your song sells via download in Japan (the same scenario plays out in just about every country).

The digital store pays the songwriter’s money to the local collection agency in Japan (called JASRAC) for the right of Public Performance. JASRAC has the right to issue licenses and collect money for the songwriter’s Public Performance as the right of Public Performance was passed to it by ASCAP/BMI/SESAC.

Now here’s where it gets really screwed up:

JASRAC arbitrarily splits the money paid by the digital store between mechanical royalties and Public Performance. For example, JASRAC decides 70% of the money it got paid by the digital music service for Public Performance goes to mechanical royalties and 30% of the money goes to Public Performance royalties.

There is no basis in copyright law for how the split is determined. The split differs from country to country and from collection agency to collection agency. It is based on who sits on the board of directors at each collection agency. If there are more publishers on the board, the split goes more toward mechanicals; if there are more songwriters, the split favors Public Performance.

Important: JASRAC does not represent the songwriter for Reproduction and has no right to split the money paid to it by the digital store. Nevertheless, the collection agencies ignore this (and apparently so do many digital music services).

For the mechanical royalties, JASRAC takes around 15% of the songwriter’s money as an “administration” fee despite not administering it (not to mention it had no right to the money in the first place).

Then, as the songwriter never joined JASRAC to get the mechanical royalties that JASRAC had no right to collect, JASRAC gives the songwriter’s money to Warner Bros., EMI, Sony, Universal and others based on each company’s market share in that country.

In other words, they give some portion of the songwriter’s money from Public Performance away to other entities. Eerily close to stealing the songwriter’s money…

He goes on to point out that it's effectively impossible for a songwriter to actually get this money that is required by law to go back to the songwriter.

Jeff has been on the warpath about this, trying to get back the royalties songwriters signed to Tunecore are owed. If you heard the story last month of Amazon suddenly taking down all Tunecore music in Europe, you might reasonably put two and two together to recognize that someone wasn't getting all the licenses required...

This is unquestionably a complex legal issue, with a variety of different separate rights under copyright law, which collide in slightly awkward ways online, combined with different laws in different jurisdictions on a global internet. The root of the problem is how copyright law itself is setup -- which is that each time a new technology comes along, regulators duct tape on a different "right" to handle things, and assume that they've fixed the issue. But that leaves us in a bit of a mess today where the internet is sorta like a sale, sorta like a license, sorta like a performance, etc... and then there's a big mess.

A true solution would be to recognize that the way copyright law is set up today is a huge Frankenstein-beast, but that seems unlikely to happen. In the meantime, however, this level of complexity appears to have opened up a way for the major labels to effectively just steal (and yes, in this case it is stealing) a ton of money from songwriters by more or less laundering the money through the complex and nearly impossible to understand international collection society system. As Jeff summarizes, the whole thing is pretty crazy:

The digital store has not gotten the right to Reproduction and has never paid the songwriter the money he/she is owed.

• The collection agency has taken the songwriter’s Public Performance royalties, split them into two, taken a % of the royalty it does not represent and then has made it impossible for the songwriter to get what’s left over.
• Other entities that have no right to the songwriter’s royalties knowingly take the royalties from the collection agencies.

From the portion of the money JASRAC was legally allowed to collect and arbitrarily assign to the Public Performance royalty, it takes somewhere between 15% – 25% of it as an administrative fee (it is not clear how much as they will not reveal the exact % they take from a particular source) and then about 6 – 12 months later, JASRAC passes it back to ASCAP/BMI/SESAC.

ASCAP/BMI/SESAC then takes an international administrative fee of around 3.7% of what’s given to them and then splits the Public Performance royalty in half, assigning 50% of the money to the songwriter and 50% of the money to the “publisher” (side note: there is no basis in copyright law for this, but it was done to protect songwriters in publishing deals).

ASCAP/BMI/SESAC then pays the songwriter 50% of the leftover Public Performance royalty 6 – 12 months after having gotten it (almost two years after it was generated) and the other 50% gets sent to the publisher; if the songwriter is both the songwriter and publisher, the songwriter receives both payments. If the songwriter is in a publishing deal, the publisher payment goes to the other entity that takes another 10% – 50%. This entity then sits on it for another 3 – 6 months before finally sending the remaining royalty back to the songwriter close to over three years after it was generated.

No one can follow exactly what is going on due to the complexity, lack of transparency and audit trail, and time delays. In the process songwriters’ royalties are either being taken from them or not paid to them in the first place.

It’s one hell of a global copyright shell game that funnels songwriter money into the pockets of everyone but the songwriter.

Yeah, and all the folks profiting then talk up in the press about how they're doing so much to "protect" artists and musicians?

Filed Under: collections, mechanicals, public performance, royalties
Companies: tunecore

BMI Hurting Artists, Yet Again

from the making-it-more-expensive dept

For many years, we've written about how, for all their talk of "helping" artists, ASCAP and BMI are often harming up-and-coming musicians. That's because many musicians get their start playing local gigs at coffee shops and restaurants and the like, who often don't pay ASCAP or BMI. That should be fine, so long as the artists play only original songs, but ASCAP and BMI usually tell venues that they need to pay anyway, just in case someone plays a single covered riff. TorrentFreak has yet another such story, of a restaurant that stopped having a local band perform every Friday night after BMI demanded $3,000:

"I said the hell with it! We only have music on Friday nights. It�s not worth $3000. How is a neighborhood restaurant running on a razor-thin margin in this economy supposed to afford an extra $3000? So I cancelled the band. Net result? Our customers suffered, local music suffered. A complete lose-lose situation."

The bottom line to BMI and other collective rights organizations? Your customers are not your enemies. Promoting live music is good for BMI and the artists they collect royalties for. Working together with local businesses rather than trying to bully and intimidate them will leave all parties better off.

Of course, BMI and ASCAP don't really care. In the end, they're not there to protect the up-and-coming guys, but the huge acts who get the large checks.

Filed Under: collections, licensing, music, restaurants
Companies: bmi

Truck Drivers Told They Need To Pay A Licensing Fee To Listen To Music While Driving

from the make-it-stop dept

Over the last few years, we've noted that various collection societies around the globe have become both more aggressive and more ridiculous in trying to get people to pay licensing fees for listening to music. Among the crazy stories that have popped up are cases of collection societies demanding cash from a woman who played music for her horses in a stable, a police station told to pay up because some police officers had a radio on and the public entering the station could hear it, hotels being told they need to pay an extra performance license because guests listen to radios in their rooms and, of course, the claim that ringtones (even legally licensed ringtones) require another license as a public performance. In some cases, these societies apparently hire people to just call up businesses and if they hear music in the background, they demand payment.

Every time we post this kind of thing, people joke that it won't be long before they want to charge people a separate license for listening to music in your car with the windows rolled down. We haven't quite reached that point yet, but the Belgian collection society SABAM, who was recently caught accepting payments for made up bands, is now claiming that truck drivers listening to the radio need to pay a performance fee as well, since the cabs of their trucks are technically their "workplace."

This seems pretty extreme, even by traditionally insane collection society standards. Most of them admit that they only seek to collect fees in cases where the public might hear the music. Going after truck cabs seems beyond ridiculous -- and thankfully some in the Belgian Parliament seem to agree, with one MP saying, "it's utter nonsense." Still, SABAM seems to be standing by their right to collect in such cases, perhaps not realizing what an incredible laughingstock this makes them, and how it just makes people respect copyright less and less when such stories get out.

Filed Under: belgium, collections, music, truck drivers
Companies: sabam

Belgian Collection Society SABAM Caught Taking Cash For Made Up Bands It Didn't Represent

from the stay-classy dept

We've seen all sorts of ridiculous actions from various music collection societies over the past few years -- from PRS trying to charge a woman who played the radio for her horses to ASCAP claiming that a legally licensed ringtone also should require another license for being a "public performance." Apparently a satirical TV show in Belgium decided to see how far they could push the Belgian collection society, SABAM. While SABAM chose not to charge them for a ringtone "performance," it did send them invoices when they said they were going to have totally made up bands performing made up songs. Neither the bands nor the songs were actually covered by SABAM since they didn't actually exist. Yet, the invoices still came:

Making a telephone call to SABAM from a public toilet, a Basta team member looked at the manufacturer of a hand dryer and explained that Kimberly Clark would be performing at an upcoming event. That would cost 134 euros minimum said SABAM.

Next the playlist. What if Kimberly Clark sang songs not covered by SABAM? Titles such as 'Hot Breeze', 'Show Me Your Hands', 'I Wanna Blow You Dry', 'I'm Not a Singer I Am a Machine' and the ever-timeless, 'We Fooled You', for example.

Five days later the answer came from SABAM. All of the songs were "100% protected" and so Basta must pay 127.07 euros.

Concerned that this might be a one-off mistake, the Basta team tried again, this time taking brand names of products from the supermarket including Suzi Wan, the name of a Chinese food wok kit, Mister Cocktail and the Party Mix, which is a hybrid of a drink and some party food, and Ken Wood, the food mixer.

They got bills from SABAM for these 'artists' totalling more than 540 euros.

The group who did all this, Basta, then wondered who was getting all of this money, so it took the food they used in that second experiment and brought them to SABAM offices to sign up to collect their money. No such luck. Though, once exposed, SABAM found it in their hearts to return the money.

There are some other amusing parts to the show, including a fun bit that mocks SABAM's inability to understand zero. Apparently, the fees for parties are based on venue size, and the smallest size range is for places that range from 1 - 100 square meters. So, Basta set up a party in 0.99 square meters, and told SABAM about it. Rather than recogizing the put on, SABAM insisted that the "1" really meant "0" and handed them an invoice for 82 euros.

Nice to see collection societies around the globe living down to their reputations.

Filed Under: belgium, collections
Companies: sabam

What About Creating A Digital Transmission Right

from the a-look-at-the-lincoff-proposal dept

Bennett Lincoff has been proposing a different kind of solution to the music industry's online woes for quite some time. Last year, he did a great job picking apart some of the major problems with Jim Griffin's Choruss plan (which, again, we've been told was supposed to launch in January, but we're still unfamiliar with any universities -- let alone the tens of thousands of students -- who have signed up for it). However, we haven't really looked at Lincoff's own proposal.

Reader SteelWolf sent in a copy of Lincoff's proposal that was sent to the Canadian government during its open copyright consultation last year. On the whole -- of the various proposals out there, Lincoff's might be classified as one of the "least bad" solutions, but that's a lot different than it being a good proposal.

The basic idea of the proposal is that a new right would need to be created under copyright law, the digital transmission right, that would replace the mishmash of copyright rights that currently cover online music (generally reproduction, distribution and performance rights). Basically, this transmission right would cover any and all music transmissions online and any license fee would be paid by the transmitter, not the transmittee. Thus, anyone could download or stream any music they want on their computer with no penalties at all and no need to secure a license. However, you would not then be able to share (transmit) that same music to someone else without a license. But this wouldn't matter so much (the theory goes), because a large service provider could pay for the transmission rights, absolving the individuals. In other words, with such a system, in theory, The Pirate Bay or a Napster could pay the transmission rights, and users would be free to both download and upload via those services. The theory is, of course, that it would be worthwhile for those sites to pay because they would get many other benefits from all the users flocking to them for sharing:

This "digital transmission right" would be a new right, not an additional right. It would replace the parties' now-existing reproduction, public performance and distribution rights (and, where applicable, the making available right and the right of communication to the public). These would no longer have separate or independent existence for purposes of digital transmissions of sound recordings or the musical works embodied in them.

The only act that would require a license, or payment of a license fee, would be the digital transmission of recorded music. Every transmission that is not subject to exemption would require authorization. This does not mean that separate payment would be due for each transmission of each recording; only that, regardless how license fees may be calculated, all non-exempt transmissions would require authorization.

Licenses would be made available unconstrained by the concerns that have driven the industry's failed campaign to salvage its sales-based revenue model. The determinative consideration would be whether or not recordings had been digitally transmitted, not whether transmissions result in sales, promote sales, or cause sales of recordings to be lost.

Licenses would be issued without regard to whether recordings are streamed, downloaded, or transmitted by some means not yet devised; whether music programming is interactive or non-interactive, or contains this, that or another recording; whether the service accepts user-generated content, operates as a P2P or social network, or otherwise retransmits or further transmits recordings that originate from other sites or services. The number of copies necessary to effect transmissions and the type of transmission technology used would not affect the availability of a license.

There are a lot of other details, and Lincoff has clearly put a lot of thought into the proposal and tried to cover many of the bases that people would likely critique. Compared to our current system, it certainly sounds like it makes more sense. He definitely does an excellent job describing that the only real problem is one of the industry's own making in still thinking entirely in the context of the old way that music was "sold." But the proposal still has a variety of problems. First, it's incredibly complex and not easy to understand. This is, of course, also true with existing copyright law. But replacing one super complex system with another one isn't necessarily a great thing either -- especially if that level of complexity isn't needed.

Second -- and this is my really big problem with it -- is that it still involves a huge and totally unnecessary bureaucratic nightmare in the middle that represents tremendous economic and societal waste in terms of managing the licenses, monitoring the usage and the transmissions of content and collecting and distributing the money. It's bureaucracy that isn't needed. We're already seeing over and over and over again that if you take out the unnecessary bureaucracy, artists can create business models that are much more direct, whether directly between the artist and the fan who wants to buy something or between an organization representing the artist. This is a much more efficient system, whereby there are plenty of opportunities to pay artists for various scarcities, rather than making up a totally unnecessary license for an abundant good which the market has already decided should be priced at zero.

As soon as you set up this bureaucratic structure, what really happens is that much of the money that could have gone directly to the artists (or to the artists' business partners) goes instead into the massive overhead required to keep the "collection society" working in the middle. This isn't a solution that helps musicians. It's a solution that helps bureaucratic middlemen.

As SteelWolf notes in his submission:

Personally I find these kinds of plans to be dangerous as they promote the idea that there is some kind of a "solution" that allows content creators to retain control over digital files as they propagate across the internet. These are not solutions, they are handwaving to obscure the fact that the economy has changed so that absolute control over content is neither possible nor necessary. The voluntary aspect of licensing promotes the idea that negotiating uses and fees with rights-holders is somehow the "morally correct" way to proceed, never once considering the idea that our culture may have moved beyond that construct.

Filed Under: collections, copyright, digital transmission right

Russian Collecting Society Sues Promoters For Not Paying Up To Let Beyonce Sing Beyonce Songs

from the copyright-law-madness dept

Last year we wrote about a situation in Russia where the promoters of a Deep Purple concert were fined because they failed to secure a license to let Deep Purple perform Deep Purple music. Seriously. It seems that the same situation is playing out again with a Beyonce concert. The Russian collecting society RAO is suing the company it believes was the promoter of a Beyonce concert for not paying up for the right to perform Beyonce music. Yes, by any standard of common sense this is ridiculous. A collection society is supposed to collect for the sake of helping an artist. But how is it possibly helpful to the artist to force promoters to pay for that artist to sing their own songs. It directly harms an artist by making it more expensive for anyone to actually promote a show -- and by funneling money away from musicians.

Filed Under: beyonce, collections, copyright, music, russia
Companies: rao