Thursday, March 29, 2012

Thoughts? [NY Times Op-Ed - thanks, Katharine!]

Op-Ed Contributor

When Stealing Isn’t Stealing


THE Justice Department is building its case against Megaupload, the hugely popular file-sharing site that was indicted earlier this year on multiple counts of copyright infringement and related crimes. The company’s servers have been shut down, its assets seized and top employees arrested. And, as is usual in such cases, prosecutors and their allies in the music and movie industries have sought to invoke the language of “theft” and “stealing” to frame the prosecutions and, presumably, obtain the moral high ground.
Whatever wrongs Megaupload has committed, though, it’s doubtful that theft is among them.
From its earliest days, the crime of theft has been understood to involve the misappropriation of things real and tangible. For Caveman Bob to “steal” from Caveman Joe meant that Bob had taken something of value from Joe — say, his favorite club — and that Joe, crucially, no longer had it. Everyone recognized, at least intuitively, that theft constituted what can loosely be defined as a zero-sum game: what Bob gained, Joe lost.
When Industrial Age Bob and Joe started inventing less tangible things, like electricity, stocks, bonds and licenses, however, things got more complicated. What Bob took, Joe, in some sense, still had. So the law adjusted in ad hoc and at times inconsistent ways. Specialized doctrines were developed to cover the misappropriation of services (like a ride on a train), semi-tangibles (like the gas for streetlights) and true intangibles (like business goodwill).
In the middle of the 20th century, criminal law reformers were sufficiently annoyed by all of this specialization and ad hoc-ness that they decided to do something about it.
In 1962, the prestigious American Law Institute issued the Model Penal Code, resulting in the confused state of theft law we’re still dealing with today.
In a radical departure from prior law, the code defined “property” to refer to “anything of value.” Henceforth, it would no longer matter whether the property misappropriated was tangible or intangible, real or personal, a good or a service. All of these things were now to be treated uniformly.
Before long, the code would inform the criminal law that virtually every law student in the country was learning. And when these new lawyers went to work on Capitol Hill, at the Justice Department and elsewhere, they had that approach to theft in mind.
Then technology caught up.
With intangible assets like information, patents and copyrighted material playing an increasingly important role in the economy, lawyers and lobbyists for the movie and music industries, and their allies in Congress and at the Justice Department, sought to push the concept of theft beyond the basic principle of zero sum-ness. Earlier this year, for example, they proposed two major pieces of legislation premised on the notion that illegal downloading is stealing: the Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act (PIPA) and the Stop Online Piracy Act (SOPA).
The same rhetorical strategy was used with only slightly more success by the movie industry in its memorably irritating advertising campaign designed to persuade (particularly) young people that illegal downloading is stealing. Appearing before the program content on countless DVDs, the Motion Picture Association of America’s much-parodied ad featured a pounding soundtrack and superficially logical reasoning:
You wouldn’t steal a car.
You wouldn’t steal a handbag.
You wouldn’t steal a mobile phone.
You wouldn’t steal a DVD.
Downloading pirated films is stealing.
Stealing is against the law.
Piracy: It’s a crime.
The problem is that most people simply don’t buy the claim that illegally downloading a song or video from the Internet really is like stealing a car. According to a range of empirical studies, including one conducted by me and my social psychologist collaborator, Matthew Kugler, lay observers draw a sharp moral distinction between file sharing and genuine theft, even when the value of the property is the same.
If Cyber Bob illegally downloads Digital Joe’s song from the Internet, it’s crucial to recognize that, in most cases, Joe hasn’t lost anything. Yes, one might try to argue that people who use intellectual property without paying for it steal the money they would have owed had they bought it lawfully. But there are two basic problems with this contention. First, we ordinarily can’t know whether the downloader would have paid the purchase price had he not misappropriated the property. Second, the argument assumes the conclusion that is being argued for — that it is theft.
So what are the lessons in all this? For starters, we should stop trying to shoehorn the 21st-century problem of illegal downloading into a moral and legal regime that was developed with a pre- or mid-20th-century economy in mind. Second, we should recognize that the criminal law is least effective — and least legitimate — when it is at odds with widely held moral intuitions.
Illegal downloading is, of course, a real problem. People who work hard to produce creative works are entitled to enjoy legal protection to reap the benefits of their labors. And if others want to enjoy those creative works, it’s reasonable to make them pay for the privilege. But framing illegal downloading as a form of stealing doesn’t, and probably never will, work. We would do better to consider a range of legal concepts that fit the problem more appropriately: concepts like unauthorized use, trespass, conversion and misappropriation.
This is not merely a question of nomenclature. The label we apply to criminal acts matters crucially in terms of how we conceive of and stigmatize them. What we choose to call a given type of crime ultimately determines how it’s formulated and classified and, perhaps most important, how it will be punished. Treating different forms of property deprivation as different crimes may seem untidy, but that is the nature of criminal law.

Stuart P. Green is a professor at Rutgers Law School in Newark and author of the forthcoming “13 Ways to Steal a Bicycle: Theft Law in the Information Age.”

Tuesday, March 27, 2012

From Tariqa - Great find and thinking :)

I was reading through the current iTunes Terms of Service because I was curious about they were handling the issues surrounding the new Match service.  I thought the section relating to their collection of data from users' media libraries and the privacy policy covering that were interesting:





"When you use iTunes Match, Genius will begin associating information about the media in your iTunes library with your Account; the association with your Account will continue for a period of time after your subscription ends. Apple will otherwise use this information as described in the Privacy Section of this Agreement. You will not be able to disable Genius while using iTunes Match, so if you prefer that we do not collect and use information from your iTunes library in this manner, you should not use iTunes Match.



You hereby agree to use iTunes Match only for lawfully acquired content. Any use for illegitimate content infringes the rights of others and may subject you to civil and criminal penalties, including possible monetary damages, for copyright infringement."



[emphasis added]



From the Privacy section just below that:



"When you opt in to the Genius feature, Apple will, from time to time, automatically collect information that can be used to identify media in your iTunes library on this computer, such as your play history and playlists. This includes media purchased through iTunes and media obtained from other sources. This information will be stored anonymously and will not be associated with your name or Account. When you use the Genius feature, Apple will use this information and the contents of your iTunes library, as well as other information, to give personalized recommendations to you."

[emphasis added]



So to use their cloud locker service you have to agree to leave Genius on and let them collect the meta-data from your library, which isn't terribly surprising.  But it seems disingenuous to say information collected by Genius will be stored anonymously because in order to make genius playlists and media buying suggestions to you they have to associate that information with your account some how.  Since dropping DRM on music sold through iTunes, Apple embeds watermarks in each music file associating it with the user who owns the account used to purchase it.  Because of that, people (bad, bad people) who have received mix CD's from friends which include songs bought by those friends through iTunes, and who use Genius and/or Match, may be exposing themselves or their friends to risk of litigation.  I realize the recording industry has backed off of such lawsuits, and that unlike file-sharing sites, no one in this example has posted a music file for downloading by the general public.  Further I don't think Apple would consider any such litigations to be in its best interests.  But on the other hand, while it was difficult for the RIAA to pin infringing activity to a specific person (not just an IP address) , here the link should be very easy to prove.



I certainly don't condone the flaunting of copyright law, but I at the same time I don't think the general public is aware that some of the activities they take for granted are exposing them to the risk of litigation.  Anyways, thought I'd bring it to your attention for the class blog.



Best,

Tariqa



p.s. Here's a link to the full ToS:  http://www.apple.com/legal/itunes/us/terms.html

Monday, March 26, 2012

Timely (from Techcrunch)

FTC Worried About Big Online Platforms, Only Sort Of Means Facebook and Google

posted 5 hours ago
Anthony Ha is a writer at TechCrunch, where he covers media, advertising, and startups. Previously, he was a staff technology writer at Adweek, worked as a senior editor at the tech blog VentureBeat, and was also a reporter at the Hollister Free Lance, where he won awards from the California Newspaper Publishers Association for breaking news coverage and writing.... → Learn More
ftc report
ftc report
The Federal Trade Commission just released a new report laying out its current thinking on Internet privacy. In some cases, the commission recommends new legislation, while in others it just want to hold more workshops.
The FTC previously released a “privacy framework” in December 2010. The framework outlined three principles that the commission wants companies to follow, including “privacy by design” (which means thinking about privacy at every stage of product development), simplified consumer choice, and greater transparency. It made perhaps its biggest splash by endorsing a “Do Not Track” mechanism in Web browsers. The FTC didn’t invent the idea, but DNT has gained more momentum since it made the endorsement.
In the new report (view or download the PDF here), the FTC includes five main action items:
  1. Do Not Track — The report notes that “significant progress” has been made in making Do Not Track a reality. “However, the work is not done.” The FTC says it will work with organizations including browser vendors, the Digital Advertising Alliance, and The World Wide Web Consortium “to complete implementation of an easy-to use, persistent, and effective” system.
  2. Mobile — The FTC wants mobile companies to provide “short, meaningful disclosures”, and it will host a workshop on May 30 in the hopes of that it “will spur further industry self-regulation.”
  3. Data Brokers — The FTC supports legislation that would give consumers access to the information that data brokers hold about them. It also calls for those brokers to “explore creating a centralized website” showing who is collecting what data.
  4. Large Platform Providers — The FTC report says that as Internet Service Providers, operating systems, Web browsers, and social media services try to “comprehensively track consumers’ online activities,” they raise “heightened privacy concerns,” and the commission plans to hold a workshop later this year to look at the issue. For now, it seems like the commission is least concerned about the final category. The report says that even though “companies such as Google and
    Facebook are expanding their reach rapidly, they currently are not so widespread that they could track a consumer’s every movement across the Internet,” so they don’t raise “the same level of privacy concerns.”
  5. Promoting Enforceable Self-Regulatory Codes — The FTC says it will participate in the Department of Commerce’s efforts to build sector-specific codes of conduct, and that if those codes are developed, the commission will “view adherence to such codes favorably in connection with its law enforcement work.”

Friday, March 23, 2012

These 34 App Makers Got Letters From Congress Questioning Their Privacy Practices

path shirt
The United States House Committee on Energy and Commerce wants to know what is up with apps that collect personal information.
So two ranking members, Henry A. Waxman and G.K. Butterfield, sent out letters to 34 iOS developers on Thursday to get a "fact-based understanding of the privacy and security practice in the app marketplace."
The letter to began like this:
Last month, a developer of applications ("apps" for Apple's mobile devices discovered that the social networking app Path was accessing and collecting the contents of his iPhone address book without having asked for his consent. Following the reports about Path, developers and members of the press ran their own small-scale tests of the code for other popular apps for Apple's mobile devices to determine which were accessing address book information. Around this time, three other apps released new versions to include a prompt asking for users' consent before accessing the address book. In addition, concerns were subsequently raised about the manner in which apps can access photographs on Apple's mobile devices.
The letters were sent out to 34 companies developing iOS apps. Here's the list:
  • Alexa Andrzejewski of Foodspotting
  • Lucas Buick of Synthetic, LLC
  • Bill Chasen of Turntable.fm
  • Tim Cook of Apple
  • Dick Costolo of Twitter
  • Dennis Crowley of Foursquare Labs
  • Adam D'Angelo and Mr. Charlie Cheever of Quora
  • Sherif Fahmy of Eye2i
  • Paul Haddad and Mr. Mark Jarding of Tapbots
  • Mark Hall of Remixation
  • Steve Jang of Schematic Labs
  • Sutha Kamal of Massive Health
  • Jason Karas of Trover
  • Andy Kim of District Nerds
  • Alexander Ljung of SoundCloud
  • Doug Ludlow of Hipster
  • Martin May and Mr. Brady Becker of Forkly
  • Melissa Miranda and Mr. Dick Brouwer of Tiny Review
  • Brooke Moreland of Fashism
  • Dave Morin of Path
  • Damien Patton of Banjo
  • Lenny Rachitsky of Localmind
  • Redaranj, LLC (Recollect)
  • Corey Reese of Ness Computing
  • Michael Seibe of Socialcam
  • Ben Silbermann of Cold Brew Labs, Inc. (Pinterest)
  • Jonathan Slimak and Mr. Hugo Bernardo of Piictu
  • Robby Stein of Stamped
  • Kevin Systrom of Burbn, Inc. (Instagram)
  • Andrea Vaccari of Glancee
  • Michael Waterfall and Mr. Oliver Waters of d3i Ltd. (Momento)
  • Jin Woo So of SK Planet Co., Ltd. (dishPal)
  • Mark Zuckerberg of Facebook
You can read the letter here.

Please follow Business Insider on Twitter and Facebook.


Read more: http://www.businessinsider.com/these-34-app-makers-got-letters-questioning-their-privacy-practices-2012-3#ixzz1pymd4dIC

thanks for the timely article, Emily G!

Monday, March 19, 2012

(sorry for the delay - Danny - thanks for the submission!)

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Turntable.FM Signs Licensing Deals With All Four Major Labels -- It's Official

March 13, 2012

By Andrew Hampp, New York

Turntable.fm now has licensing agreements with all four of the major labels in place. The announcement was made today at South By Southwest by Turntable.fm founder Billy Chasen and co-founder Seth Goldstein during the panel "Turntable.FM: The Future of Music Is Social," and follows reports last week that the site was nearing agreements with several labels.

"This feels like an all-time record speed launch - when we launched we really didn't come at this from the music industry, it was all new to us," Goldstein told Billboard.biz of the nine-month-old service's new licensing deals. "Our model is unique - we're not a radio service, not an on-demand service. We have interesting aspects that really require some out-of-the-box thinking. We felt that from the get-go the labels were absolutely different from what I'd been led to believe. They gave us a lot of time and attention. Compared to their user base, we're a tiny service in the broad scheme of things."

Turntable.fm Scores ASCAP, BMI Licensing

Indeed, the traffic numbers of Turntable.fm tell a different story from that of Pandora and Spotify. Since debuting in late June 2011, Turntable.fm has yet to eclipse the monthly traffic record it reached during its full month in July - 207,000 unique web-based visitors, according to Comscore, although it has been steadily regaining traffic in recent months, achieving its third-highest month in February with 176,000 visitors. Pandora, by comparison, reached 17.4 million web-based uniques and the still-nascent Spotify was visited by 1.1 million uniques during the same period.

Backbeat: Turntable.fm's SXSW Interactive Party featuring Flying Lotus, AraabMuzik

Of course, the Comscore numbers don't include mobile, which is a recent area of growth for Turntable.FM since it launched an iPhone app in September.

See all of our SXSW 2012 coverage right here

But it is Turntable's potential as a promotional vehicle that has labels most excited. Stephen Bryan, Warner Music Group's exec VP-digital strategy and business development, sees radio services like Turntable.fm playing a pivotal role in the path to subscriptions and purchasing new music. "We see it as a sort of funnel to attract more lean-back customers into the digital space and figure out how to monetize them over time," Bryan told Billboard.biz. And although Warner has notably sat out other digital platforms like Vevo, for music videos, and certain artists like the Black Keys have resisted streaming their music through on-demand platforms like Spotify, Bryan sees a fairly widespread acceptance of the Turntable.fm model as a means of music discovery. "We want to see all our artists participate in these new businesses, and want to talk them through and get them more comfortable with them over time."

Other labels see Turntable.fm as an artist-development platform. Bill Campbell, senior VP of global digital business development for Universal Music Group, told Billboard.biz that he likes the site's combination of social engagement, music discovery and gamification. He suggested that Universal artists could eventually create their own branded avatars for the Turntable.FM DJs or even create virtual goods as rewards.

"Once you start to gamify music discovery, that's when you start really understanding what social engagement and loyalty comes down to," Campbell said.

He even sees potential to take Turntable.fm on the road, a la Maybach Music rapper Wale's promotion during his fall 2011 "Ambition" tour. "As artists are setting up tour dates, they could schedule a virtual date and tell fans to join them on such and such date. From a listening standpoint, it's a great way for artists to showcase their music to the world," Campbell said.

Mark Piibe, EMI Music's exec VP of global business development, likes Turntable.fm's unique experience relative to the increasingly crowded music-streaming market. "Instead of just having an algorithm program where you hear one DJ who runs a channel on a we radio station, you have this constant environment where it's participatory and the DJs change. We don't see that with other of these kinds of services out there," Piibe told Billboard.biz.

Also expected to evolve is Turntable.FM's ad model. The platform recently welcomed two of its first official ad partners last month when Pepsi and Intel teamed up for a Turntable Tuesdays program for SXSW that included branded DJ rooms and a DJ battle contest. The winning DJ, @Qbertplaya, scored a remote DJ gig at Turntable.FM's SXSW Interactive party on March 10 and an ASUS Zenbook UX31 Series Ultrabook from Intel.

Goldstein says "no traditional advertising" will be accepted on the Turntable platform. "We're really focused on how we can improve the user experience, and we want to associate these brands as bringing value and talent for our consumers," he said.

Wednesday, March 14, 2012

Turntable.FM Signs Licensing Deals With All Four Major Labels -- It's Official

From Billboard (and Danny - thanks!)

March 13, 2012

By Andrew Hampp, New York

Turntable.fm now has licensing agreements with all four of the major labels in place. The announcement was made today at South By Southwest by Turntable.fm founder Billy Chasen and co-founder Seth Goldstein during the panel "Turntable.FM: The Future of Music Is Social," and follows reports last week that the site was nearing agreements with several labels.

"This feels like an all-time record speed launch - when we launched we really didn't come at this from the music industry, it was all new to us," Goldstein told Billboard.biz of the nine-month-old service's new licensing deals. "Our model is unique - we're not a radio service, not an on-demand service. We have interesting aspects that really require some out-of-the-box thinking. We felt that from the get-go the labels were absolutely different from what I'd been led to believe. They gave us a lot of time and attention. Compared to their user base, we're a tiny service in the broad scheme of things."

Turntable.fm Scores ASCAP, BMI Licensing

Indeed, the traffic numbers of Turntable.fm tell a different story from that of Pandora and Spotify. Since debuting in late June 2011, Turntable.fm has yet to eclipse the monthly traffic record it reached during its full month in July - 207,000 unique web-based visitors, according to Comscore, although it has been steadily regaining traffic in recent months, achieving its third-highest month in February with 176,000 visitors. Pandora, by comparison, reached 17.4 million web-based uniques and the still-nascent Spotify was visited by 1.1 million uniques during the same period.

Backbeat: Turntable.fm's SXSW Interactive Party featuring Flying Lotus, AraabMuzik

Of course, the Comscore numbers don't include mobile, which is a recent area of growth for Turntable.FM since it launched an iPhone app in September.

See all of our SXSW 2012 coverage right here

But it is Turntable's potential as a promotional vehicle that has labels most excited. Stephen Bryan, Warner Music Group's exec VP-digital strategy and business development, sees radio services like Turntable.fm playing a pivotal role in the path to subscriptions and purchasing new music. "We see it as a sort of funnel to attract more lean-back customers into the digital space and figure out how to monetize them over time," Bryan told Billboard.biz. And although Warner has notably sat out other digital platforms like Vevo, for music videos, and certain artists like the Black Keys have resisted streaming their music through on-demand platforms like Spotify, Bryan sees a fairly widespread acceptance of the Turntable.fm model as a means of music discovery. "We want to see all our artists participate in these new businesses, and want to talk them through and get them more comfortable with them over time."

Other labels see Turntable.fm as an artist-development platform. Bill Campbell, senior VP of global digital business development for Universal Music Group, told Billboard.biz that he likes the site's combination of social engagement, music discovery and gamification. He suggested that Universal artists could eventually create their own branded avatars for the Turntable.FM DJs or even create virtual goods as rewards.

"Once you start to gamify music discovery, that's when you start really understanding what social engagement and loyalty comes down to," Campbell said.

He even sees potential to take Turntable.fm on the road, a la Maybach Music rapper Wale's promotion during his fall 2011 "Ambition" tour. "As artists are setting up tour dates, they could schedule a virtual date and tell fans to join them on such and such date. From a listening standpoint, it's a great way for artists to showcase their music to the world," Campbell said.

Mark Piibe, EMI Music's exec VP of global business development, likes Turntable.fm's unique experience relative to the increasingly crowded music-streaming market. "Instead of just having an algorithm program where you hear one DJ who runs a channel on a we radio station, you have this constant environment where it's participatory and the DJs change. We don't see that with other of these kinds of services out there," Piibe told Billboard.biz.

Also expected to evolve is Turntable.FM's ad model. The platform recently welcomed two of its first official ad partners last month when Pepsi and Intel teamed up for a Turntable Tuesdays program for SXSW that included branded DJ rooms and a DJ battle contest. The winning DJ, @Qbertplaya, scored a remote DJ gig at Turntable.FM's SXSW Interactive party on March 10 and an ASUS Zenbook UX31 Series Ultrabook from Intel.

Goldstein says "no traditional advertising" will be accepted on the Turntable platform. "We're really focused on how we can improve the user experience, and we want to associate these brands as bringing value and talent for our consumers," he said.

Lawyers Are Getting One-Third of Sony's $8 Million Legacy Artist Settlement...

 

Wednesday, March 14, 2012
by paul - Digital Music News
In fact, they may be the only real winners in this class action settlement! A brief history: earlier this month, Sony Music Entertainment agreed to pay its legacy artists $7.95 million to settle a number of digital royalty disputes. Specifically, these older artists ― led by the Youngbloods and Shropshire (of "Grandma Got Run Over by a Raindeer" fame) ― have been arguing that digital downloads should be classified as licenses instead of sales, a change that modifies the payout from a few cents per download to 50 percent.
But unlike previously thought, the Allman Brothers and Cheap Trick already settled their cases, leaving this settlement for 'everyone else'. "The notice of settlement will be sent out to all Sony and Arista artists," music industry attorney Steve Gordon told Digital Music News. "They then can opt to join the settlement if they qualify, or opt out if they want to pursue a separate action."
And it's really not that juicy of a payout. Here's a complete breakdown of the settlement - and what it means for artists, Sony, and the lawyers - by Gordon.
__________________________

"While this sounds like a lot of money, it's probably not a great deal for artists..."


First, some background. The settlement comes a year after rapper Eminem won a court case that concluded that music downloads from iTunes are licenses, not sales. The distinction is crucial because, in the case of licenses, labels have to give artists 50 percent of revenues and not the 10-20 percent rate artists receive from record sales.


"The decision in the Eminem case has inspired a slew of lawsuits by iconic artists seeking similar results. However, Eminem was not the first to bring suit..."



Previously, the Allman Brothers and Cheap Trick filed suit against Sony on the same grounds but their claims settled (and the settlements are confidential). In fact, it's also worth noting that most superstar artists used their leverage to increase their percentage of income or get big advances against digital sales years ago!

"So here's the breakdown..."


Sony pays a total of $7.95 million to settle the case, if the court approves everything. However, the plaintiffs' attorneys will take $2.65 million of that off the top (or one-third), leaving $5.3 million for the artists.
Of that $5.3 million, $5 million is reserved for artists who sold at least 28,500 total downloads on iTunes between the inception of iTunes on January 9, 2001 and December 31, 2010 including current class members Youngbloods and Shropshire. Qualifying members would split that $5.3 million pro rata to the number of downloads of their records. However, these two artists may ultimately receive a lot less than splitting the $5 million between themselves because any artist who was signed to Epic, Columbia or Arista Records who sold more than 28,500 is eligible to join the class if they entered into agreements dated between January 1, 1976 and December 31, 2001. According to a trusted source there may well be over 100 artists would qualify for membership. The balance of the money, only $300,000, is reserved for all Sony artists with fewer than 28,500 total downloads on iTunes.
The proposed settlement also provides for a prospective 3% bump in artists' royalty rates with respect to permanent digital downloads and ringtones sold in the US after January 1, 2011. The 3 percent is against Sony Music Entertainment?s gross receipts. This amounts to 3% of 70 cents (the amount Sony received for 99 cent downloads) and that is only 2.1 cents.

"Which means Sony and the lawyers the big winners..."


The beauty of this is that Sony now has an efficient means of avoiding additional suits. If the judge approves the deal, it will be legally binding on Sony artists who qualify as class members, who must either file a claim or expressly opt out. And artists who may otherwise have brought suit may be tempted to take a sure thing and avoid legal fees.
Oh, and if artists have a "red balance" (that is, still owe the record company for unrecouped advances, recording costs, indie marketing and video costs), they will not receive cash. Instead their accounts will be "credited."
Which brings us to the lawyers: Digital Music News cooked up this headline, but it must be said in the lawyers' defense their share of 2.6 million will come out to significantly less than their hourly rate. Initially there were four firms working on behalf of the plaintiffs and more than one lawyer at each form worked on the case.
Steve Gordon, Attorney.

Monday, March 12, 2012

Jay-Z

Jay-Z Faces Lawsuit Over 'Big Pimpin'' Sample

Also: Rapper will perform at SXSW festival


Jay-Z
Landov
By Rolling Stone
March 7, 2012 8:40 AM ET
Jay-Z is facing a serious legal challenge over the rights to a hook sampled on his 2000 hit "Big Pimpin'." The nephew of Egyptian composer Baligh Hamdy is close to taking the rapper to court, claiming that he ruined his uncle's song, "Khosara, Khosara," and that his family has not been fairly compensated for its use as the lead instrumental motif in the hit.
A handful of Egyptian musicians have attempted to claim a valid license on "Khosara, Khosara" but have failed to substantiate their claim well enough to pursue a lawsuit. Much of the suit hinges on Egyptian copyright law, which confers economic ownership to authors as well as the ability to control what happens with the material. Though the song was licensed to Jay-Z, Hamdy's family say that the rapper "mutilated" the source material and required more specific permission.
Osama Ahmed Fahmy, Hamdy's nephew, is pushing to get a cut of Jay-Z's revenue for the song prior to the 2007 filing of his lawsuit up until now, including a portion of the emcee's concert profits.
In other Jay-Z news, the rapper is set to appear at the SXSW festival for the second year in a row. Jay-Z's performance at Austin City Limits on March 12th will be live-streamed on YouTube as part of American Express' Amex Sync Show promotion. The rapper performed at Kanye West's G.O.O.D. showcase last year, where they debuted a song from their Watch the Throne album.


Read more: http://www.rollingstone.com/music/news/jay-z-faces-lawsuit-over-big-pimpin-sample-20120307#ixzz1ovPqezuO

HERE is the song that is allegedyly infringed: http://www.youtube.com/watch?v=bKcVDJGOvNU

Thanks, Natalie!

Wednesday, March 7, 2012

Netflix and Cable Sitting in a Tree

This just in from one of our guest lecturers - you can guess who!



Voila...capitulation.


They can't compete with the cable operators for the licenses, so they just become a front end brand using the cable operators on demand licenses and distributing through the cable network (charging similar fees to other on demand cable movie services-ie more than they do now)...way worse business than where they are now as the operators will take a big chunk of the margin.


Netflix Explores Putting Movie Service on Cable Systems

Play
Netflix to Partner With Cable?
Netflix Inc. (NFLX), seeking to expand its subscription video-streaming business, is considering partnerships with cable operators to offer its service as part of their premium lineup.
“It’s not in the short term, but it’s the natural direction in the long term,” Chief Executive Officer Reed Hastings said at a Morgan Stanley technology conference last week in San Francisco.
Alliances would help Netflix reach more customers and mollify cable operators that see the company’s $7.99 monthly service as a threat to cannibalize their businesses, Hastings suggested at the Feb. 28 event. The company, which delivers films and TV shows over the Web, has held talks with cable providers, Reuters reported yesterday, citing people it didn’t identify.
Netflix is gaining clout to make such deals because it is offering more exclusive content, following the lead of Time Warner Inc. (TWX)’s HBO channel, Hastings said. The biggest hurdle is how revenue is shared.
“There’s no reason that doesn’t make sense for Netflix, depending on the economics,” Hastings said. “If we look at potential competitors, if we can share some of the margin with them and then they’re making money because they are upselling us through their ecosystem, that’s a good thing all around.”
Such agreements also could shield Netflix from potential moves by Internet service providers to switch from flat-rate monthly data fees to usage-based pricing models. Netflix has argued against usage-based billing in Canada and has asked U.S. regulators to take a stand against such moves domestically.

Exclusive Content

The first partnership may be tested by year-end, Reuters reported.
“We meet with cable companies all the time,” said Steve Swasey, a spokesman for Netflix, who declined to discuss specifics of talks. “Reed’s comments about future possibilities stand.”
Alex Dudley, a spokesman for New York-based Time Warner Cable Inc. (TWC), the second-largest U.S. cable system, declined to comment. D’Arcy Rudnay, a spokeswoman for Philadelphia-basedComcast Corp. (CMCSA), the largest cable operator, didn’t respond to a request for comment.
Netflix, based in Los Gatos, California, gained 1.7 percent to $108.90 at 11:36 a.m. New York time. The shares had advanced 55 percent this year before today after declining 61 percent in 2011.
By the middle of 2013, the company will have five original series for streaming, according to Ted Sarandos, chief content officer.
To contact the reporters on this story: Cliff Edwards in San Francisco at cedwards28@bloomberg.net; Andy Fixmer in Los Angeles at afixmer@bloomberg.net
To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net

Why ‘Mastered For iTunes’ Won’t Defuse a Copyright Time Bomb (thanks, Katharine!)

Why ‘Mastered For iTunes’ Won’t Defuse a Copyright Time Bomb

Next year, a time bomb embedded in the Copyright Act of 1976 starts to detonate, as valuable copyrights fall back into the hands of artists who decide that they would prefer to own their songs, rather than allowing their label and publisher to keep selling them.
Recordings released in 1978 will be up for copyright termination in 2013, even if artists legally sold those songs away decades ago. Recordings from 1979 fall into this category in 2014, and so on, over the years.
These are valuable copyrights, useful for licensing in movies, advertisements, and videogames in addition to being sold in iTunes and elsewhere. Wouldn't it be convenient if the labels could devise a way to hang on to those sound recordings? After all, everyone from the guy behind "Funkytown" to The Eagles is lawyering up to take back songs sold to labels and publishers.
Indeed, Mitch Glazer, later hired as a lobbyist for the RIAA, gave the labels some grounds to keep these copyrights by adding a provision to the Copyright Act in 1999 that attempts to categorize sound recordings as "works for hire" made by musicians as employees of the labels. The U.S. Registrar of Copyrights objected strongly to the addition because it changed the law, rather than correcting an oversight. (Update: The provision was repealed [thanks, Eriq Gardner], although sources we've spoken with say the "works for hire" issue is still at play today.) Our courts - possibly the Supreme Court - will likely have to untangle the whole mess after artists start trying to get their songs back next year, with notices already being filed.
One magical option for the labels would be to create a new sound recording copyright for these songs - say, by remastering them for iTunes. It did seem a bit odd that Apple, after listening to audiophiles complain for nearly nine years about the sound quality of songs sold in iTunes, would unveil its "Mastered for iTunes" program the very year before these old copyrights started reverting. Could the labels' ace in the hole be a plan to sell newly-copyrighted remasters while allowing the old and busted ones to revert?
After hearing from multiple lawyers and other sources (some who would not comment on the record), we're convinced that Mastered for iTunes cannot allow record labels to defuse this copyright time bomb - even though movie studios have been granted new copyrights for colorizing black-and-white movies. As it turns out, the difference between the regular version of the song and the "remastered for iTunes" version is too small, from a legal perspective, to justify a new copyright (and with it another 35 years of label control). For a new copyright, a band would have to go farther than that - say, by recording a new version.
Steve Gordon summed things up by phone, putting our mind at east that "Remastered for iTunes" cannot be a copyright land-grab disguised as an improvement in compressed sound quality. Casey Rae-Hunter, deputy director of the Future of Music Coalition agreed, saying that there's not enough change in expression between the original and the remaster. (Apple and all four major labels declined to respond.) Then we heard back from New York entertainment lawyer John Tormey III, Esq. (email) with a remarkably in-depth explanation of why Remastered for iTunes won't stop copyrights from reverting to artists starting next year.
If you're interested in the intricacies of this situation, buckle up:
First of all, none of my comments are intended to speak to Apple's specific situation, or the specific situation of Apple adversaries if any.
Second, the two parts to your question may be apples-to-oranges, to some degree. Though there will always be exceptions, those in your hypothetical question taking action to retrieve "revert[ed]" music-related copyrights under the Termination Of Transfer provisions of the U.S. Copyright Act – See 17 United States Code (U.S.C.) § 203, and 17 U.S.C. § 304 – would more typically be songwriters or their families seeking a "return home" of rights in the old songs (compositions), rather than in their corresponding masters (sound recordings). Those are two different rights, albeit corresponding to the same album material perhaps. In fact, the United States Copyright Office (USCO) has two different forms for these two different rights – USCO "Form PA" corresponds to songs (compositions), whereas USCO "Form SR" corresponds to masters (sound recordings).
Traditionally in pop music record-deal history, songs have been exploited by and through publishing companies and performance rights societies as agreed and permitted by the original songwriter (generally speaking and to simplify, "publishing") – whereas rights to the masters traditionally originated with, and often stayed with, the record labels. So, the songwriter/musician signed to a traditional record deal may have retained his/her "publishing" and even received a per-unit record royalty (or been stiffed out of one, perhaps), but that doesn't mean that the songwriter/musician ever had ownership in the master (sound recording).
But for the sake of your hypothetical, let's assume that a songwriter/musician somehow originally held both sets of rights (1. Songs, 2. Masters) in the same initially-self-produced album. And now, there's a later-occurring transferee or licensee, like an Internet distribution company, trying to stave off the songwriter/musician's family's pursuit of revert[ed] (or as I sometimes colloquially say, "recaptured") rights under the Termination Of Transfer provisions of § 203 or § 304.
Sure, your hypothetical Internet company can try to claim a "new copyright" in a newly-reworked master, and can even try to file a new (or additional) Form SR with the United States Copyright Office (USCO) corresponding to it, but: (A) the USCO, federal courts, and jury might still disregard the Internet company's claim and filing post facto, and adjudicate to same effect when the claimed "new" right is administratively-tested and/or forensically-tested; (B) the Internet company may be making the "new" claim and filing for "bluff" purposes alone and full well know how flimsy their theory is under their own fact-pattern, never having any intention to go to court or even to the USCO with the "new copyright" theory; and (C) the analysis could be affected by whether the copyright in and to the original, underlying sound recording has already fallen into the public domain (PD) at time of the remastering. If a party in the old chain-of-title for the original master failed to timely file a renewal when the statute required, for example, the copyright in the underlying original work could already be PD, and a new claim and filing won't bring it back from the dead.
"Derivative work" is a term of art under the Copyright Act. Under the Copyright Act, a "derivative work" is defined as a work based upon one or more pre[-]existing works… such as a new musical arrangement – or, yes, a "transformed" "sound recording" – your very case. See 17 U.S.C. § 101. Depending upon factual circumstances, one could argue that a remaster based upon an original master, is a derivative work of the original master, yet I think that would pre-suppose audibly-detectible differences between the first and second master such that USCO, judge, and jury wouldn't otherwise simply hear the two as identically the same. Jurors, particularly, aren't always musicians [our emphasis].
Let's assume, though, that your hypothetical new master is significantly audibly-distinct from, and even improved with respect to, the first master. Still, as stated by the Second Circuit, a derivative (work) copyright is a good copyright only with regards to the original embellishments and additions made [to] the underlying work [our emphasis]. See, e.g., Harvey Cartoons v. Columbia Pictures, 645 F. Supp. 1564, 1570 (SDNY, 1986). Copyright in a derivative… work merely protects against copying or otherwise infringing… the original contribution contained in the derivative work. Harvey Cartoons v. Columbia Pictures, 645 F. Supp. 1564 (SDNY, 1986). See also Rohauer v. Killiam, 551 F.2d 484 (2nd Cir. 1977).
So, yes, the Internet company could try to claim a "new" copyright in the new master. But that claim is limited to the incrementally-added material, at best. And that "new" claim shouldn't extend the old copyright term in the underlying master – else the limitations on the term of copyright under 17 U.S.C. § 302 would be rendered meaningless thereby. Imagine record labels re-registering new masters every few years, on into perpetuity perhaps, subverting the purpose and intent of the Copyright Act – which instead only intends to confer a limited but not perpetual lawful monopoly to rights-holders.
Rather, the best that the Internet company in your hypothetical can hope for, when claiming and registering a copyright in the new master, is to seek protection in the new additions made to the old work. That being said, if a USCO Examiner, federal judge, and/or jury can't actually hear the changes between the old and new work, then the claimant is going to have a difficult if not impossible time as a practical matter alone, using federal law and the judicial process to enforce those "new" claimed rights [our emphasis]. Also, if the original underlying sound recording has already fallen into the public domain, the claimant will likely not evoke much judicial sympathy under the hot lights of litigation, to say the least, as the claimant's new action will look more like a ruse trying to resuscitate dead rights than anything else. In other words, under most scenarios, there won't likely be much substance to the remasterer's "new claim".
As for whether or not the claimant could try to use the new claim or filing for the re-master as a shield against songwriter descendants proceeding under the Copyright Act's Termination Of Transfer provisions (17 U.S.C. § 203, and 17 U.S.C. § 304), I doubt that that approach would be effective under most circumstances, except maybe as a bluff perhaps. The statute and legislative intent are clear that the party acting pursuant to the Termination Of Transfer provisions of the Copyright Act, should be entitled to recapture (or as the statute says, "rever[sion]") of the original rights as the statute provides. Most "recapturing" parties in your hypothetical would likely be pursuing recaptured rights to compositions rather than sound recordings. The majority of such Termination Of Transfer scenarios in music will be songwriter-families recapturing rights to songs and not masters. Their songwriter forebears often never maintained rights in the masters to begin with.
There you have it.

*****

Really interesting copyright play, IMO - CM

Why Comcast Will Crush Netflix (thanks, Kevin!)

FC Expert Blog

Why Comcast Will Crush Netflix

BY FC Expert Blogger Kaihan Krippendorff | 03-01-2012 | 9:15 AM
This blog is written by a member of our expert blogging community and expresses that expert's views alone.


I’m sitting in my rental car outside of eBay headquarters on a rainy day in San Francisco. I’m about to step into my second day delivering an Outthinker workshop to group of technology execs from various companies. Television news here centers on the rapidly reorganizing technology landscape: the Yelp IPO, Yahoo suing Facebook during its pre-IPO quiet period.
But the most game-changing technology news has gone mostly overlooked. Comcast, the largest U.S. cable service provider, announced it will soon launch a video-streaming service aimed at beating Netflix. It’s easy to miss the strategic importance of this move. But if you understand the strategic narrative that cable companies have played again and again to devastating effect, you will recognize this as the critical turning point in the plot.
The battle to own the “digital home” has been waging for years, but over the past 12 months, it has really heated up. Apple is rumored to be launching a television, Amazon’s video-streaming business is taking off, Samsung and other electronics firms are embedding ever more online video services into their TVs, and television channels are increasingly streaming directly. How this all plays out will have significant consequences for investors and television viewers around the country.
The future may look uncertain, but look to the past and you will see a pattern that points clearly to where things may be going. A shift is underway. Cable companies look poised to turn the tables on Netflix and other video streaming players. The recent relative stock performance of Comcast and Netflix underscores that this is happening (see the stock chart below). That in a few days Netflix will lose its rights to carry Starz video content, including my daughter’s favorite Disney films, offers yet more evidence.

Here is what the past tells us about who may win and lose in this high-stakes game:
1. There are only three sources of advantage, and Netflix has none of them: For any company to win over the long term, they must secure one of three sources of competitive advantage: customer captivity (think Microsoft Windows), economies of scale (think Walmart), or preferential access to resources (think De Beers Diamonds). Netflix once enjoyed customer captivity, but this advantage has eroded thanks to its missteps that upset customers, drove an exodus of more than 800,000 Netflix users, and sent its stock price reeling.
2. The tortoise inches toward the finish line: Cable companies have historically played the tortoise to high-tech innovator hares. They adopt a predictable pattern--they let someone introduce a new service, watch the market grow, and much later step in and take away the opportunity. This is how cable companies beat out TiVo (which introduced the world to the DVR) and Vonage (which convinced Americans to embrace VoIP). Comcast’s announcement is the most direct message yet that it intends to seriously attack the new video-streaming opportunity Netflix has ushered in.
3. Google and others understand the game: This is why Google is making steady inroads into the home. In Kansas City, Google has launched an experiment with potentially huge consequences. It has begun wiring homes with high-speed fiber optic service, which positions it to get into the cable service provider game.
4. Netflix’s last hope is to become HBO: There is little reason to believe Netflix can regain customer captivity or create economies of scale, so the company’s only hope is to secure preferred access to content, which it is attempting to do by producing its own shows and movies. If Netflix can succeed at this, it will begin looking more like HBO. If it fails, it falls.
As you watch your company evolve, look for these three sources of advantage and see who is moving toward them ahead of you. Do you have customer captivity? Do you have economies of scale? Do you have preferential access to a key input? If not, start making plans, like Google is doing and Netflix probably should have done, to build such power now.