Confusion about SoundExchange’s role in web royalties…
Yesterday a post titled “RIAA Claims Ownership of All Artist Royalties For Internet Radio” made its way on the front page of Slashdot. In that post, the author links to a Daily Kos article that states that SoundExchange has the right to collect royalties for any music streamed over the internet, which is true. Where both articles go wrong, however, is when they jump from that fact to the false assumption that webcasters cannot play anybody’s music without paying royalties to SoundExchange. Here are the exact quotes:
With the furor over the impending rate hike for Internet radio stations, wouldn’t a good solution be for streaming internet stations to simply not play RIAA-affiliated labels’ music and focus on independent artists? Sounds good, except that the RIAA’s affiliate organization SoundExchange claims it has the right to collect royalties for any artist, no matter if they have signed with an RIAA label or not. […]
[…] One solution proposed by Webcasters is to just not play RIAA-member songs under the assumption that then they don’t have to pay the royalty to the RIAA’s collection body, SoundExchange; Webcasters would then just pay the independent artist the royalty.
This sounds fair and just because it is. However, the RIAA is not about being fair and just. […]
Sorry, but they have it wrong. I think I’ve written about this before, but I’ll explain the issue again as simply as I can.
People who create music have the rights to decide what they do with that music. That includes the right to negotiate with webcasters to stream their music over the internet. Our government still recognizes this right today.
The Digital Millennium Copyright Act (DMCA) gave webcasters another way to secure “permission” to play an artists music. Rather than negotiate with the owners of the music they wish to play, webcasters could pay SoundExchange, an organization associated with the RIAA, royalty rates that were established by the United States Copyright Board. SoundExchange’s job was to distribute the royalties to the artists. Essentially, the DMCA gave webcasters a way around securing permission from music artists to play their music. I think that’s horrible, but webcasters loved it. They could play practically anybody’s music for a low rate and not have to be sued for copyright infringement. Good for them, but bad for the owners of the music. What about what they want to do with their property?
This SoundExchange option for webcasters was just that: an option. Webcasters are free to ignore SoundExchange and make their own deals with any artist or music label they wish, and at any royalty rate. Or for free, for that matter. Artists are also still free to stream their own music without having to deal with SoundExchange. As far as distributing music over the internet, the DMCA only increased the number of options available to webcasters.
SoundExchange is not an option for artists, however. No matter who an artist wishes to grant publishing rights to his music to, anybody can play his music by going through SoundExchange. No matter what an artist wishes to charge for his music, anybody can play his music according to SoundExchange’s rates. All of the webcasters’ new “rights” to create their internet radio stations came at the expense of the artist. And accordingly, it also came at the expense of those who purchase the rights to artists music. Yes, it was the big labels, including those that are associated with the RIAA, that lost their rights. All because some people think it is their right to play other people’s music on their own radio stations.
That’s what SoundExchange means when they say that they can claim royalties from webcasters that use compulsory license to stream music. It’s compulsory for the artist to allow his music to be streamed over the internet by any webcaster that meets SoundExchange’s rates. That doesn’t mean that it is compulsory for the artist to only go through SoundExchange to stream his music, or to make other arrangements with other webcasters for higher or lower rates.
The authors of the Daily Kos and Slashdot post are mistaken when they suggest that SoundExchange has taken away the artists ability to play his own music without paying SoundExchange’s rates. And when the Daily Kos author states that “Artists can offer to download their music for free, but they cannot offer their songs to Internet radio for free,” he is incorrect. An artist can still offer his songs on internet radio for free. What he can’t do is stop SoundExchange from accepting royalty rates on his behalf by those webcasters that play his music and take the SoundExchange option.
So who is to blame for this? They believe that it’s the RIAA, but who gave the SoundExchange its power? If it wasn’t for the government’s intrusion into the music business, the artist would still have sole rights to his own music. I can accept that the RIAA has some blame for this mess, depending on how much “input” they gave the government when they established the SoundExchange option. However, the only solution for this problem is eliminate the law that gives SoundExchange any power at all. Setting music royalty rates is not a proper role for government.
Tags: [daily kos, digital millennium copyright act, internet radio, riaa, royalty rates, slashdot, soundexchange]Happy Feet
I’m not very bright. When I sat down to watch Happy Feet this week, I was expecting a movie about a penguin who learns to stick up for himself and do what he loves regardless of how the majority may feel. I know it’s more of a kid’s movie, but I was in the mood to watch something light-hearted and I thought the movie might have a good message. Boy, was I wrong. The movie started like I expected, but it quickly turned into environmentalist propaganda.
I’m very disappointed in myself. The clues were there. Penguins, Antartica, the fact that the movie comes out in today’s culture, the text on the back of the box that I didn’t read… all signs that suggest that the movie might have an environmentalist position. But no, I said, “Oh, a penguin that loves to dance!” and picked it up. Shame on me.
Hi, I’m Mumbles. I can’t sing, but I sure can dance! Why do you want to kill me?
Shame on the makers of this movie too, though. If the purpose of a movie is to push the idea that we should treat animals as if they had rights, I think it’s really dishonest to portray animals as if they were fully-rational humans that just look different than us. Animals aren’t humans. They don’t talk, dance, sing, crack jokes, or do anything that would elevate themselves to the same rights as humans. Penguins are just animals, and to sacrifice ourselves in any way (including lowering our prosperity in the tiniest bit) for their sake would be immoral and wrong. There are fish out in the sea, and if the penguins want them they’ll have to get them before we do.
I can think of one interesting question that this movie could brings up. If penguins really possessed rational minds like they did in the movie (essentially making them humans that just look different), should we change how we should treat their habitat? I don’t think it changes anything one bit. Just because penguins suddenly can think and talk does not give them rights that even humans don’t have: To claim vast amounts of land only because they want to live a penguin lifestyle. There is one quick shot in the movie of an environmentalist that wants to ban all fishing within hundreds of miles around Antartica in order to preserve the penguin food supply. Just imagine if we treated all of the millions of the different species of animals with that same respect. There would be nowhere to live!
I don’t think that people should kill animals or destroy the environment just for the heck of it. I just refuse to acknowledge that we should budge one inch in our quest for prosperity and happiness for the sake of animals. People come first.
Tags: [No Tags]Internet Radio Equality Act
Internet webcasters have been crying for somebody in the government to step in and stop the US Copyright Royalty Board’s ruling, and now it looks like they’re going to get some help. From an article at internetnews.com:
“The illogical and unrealistic royalty rates set by the CRB have placed the future of an entire industry in jeopardy,” Ward said in a statement praising the Inslee-Manzullo bill. “The Internet Radio Equality Act is the last best hope webcasters, artists and listeners have to keep the music playing.”
Of course they’d have to call it the “Internet Radio Equality Act.” When one person thinks of “equality,” he or she would think of things being equal. And that’s what this bill does, right? It tries to equal out the interests of webcasters with the interests of the music owners? Well, it’s precisely this attempt that makes this bill inequitable. It takes away the rights of the artists (and the record companies they sell their music to) in order to please the desire of a few people who want the artists’ property. To say that it’s “fair” for webcasters to set the royalty rates of an someone else’s music is to say that the person never had the rights to the music at all. It says that the creator of any intellectual property has a say in what is done with that property only up to a certain point, at which point someone else can take it. That point, in this case, is the webcaster’s desire to play music at a rate that can be supported with internet advertisement, but I think that once you take away someone’s right to their property it’s almost arbitrary as to how you do it and to what amount you do it. No matter how far you go, you’re still against it on principle. Today webcasters may be willing to pay $.0008 cents per broadcast, but who knows what it will be tomorrow? One thing is for sure: The one individual who won’t be setting the rate is the artist.
The only way we can achieve “equality” is for everybody to be treated the same under the law and for people to respect one another’s rights The artist who creates music has the right to control what is done with that music. Rather than respect that right, webcasters are trying to get Congress to pass laws that take what they want. If Congress will do such a thing, then what other rights may be up for grabs?
One of the things I hate about this debate is how it’s framed as a quest to “Save Internet Radio” when broadcasting music online is not at stake. People will still be able to listen to streaming radio on the internet after this ruling, even if all of the webcasters that can’t afford the new rates go out of business. There are plenty of stations that do have the permissions from artists, and there are many online music services that give you almost unlimited access to millions of songs. What’s really at stake for some webcasters is their own ability to play music that they can’t afford.
Tags: [internet radio, internet radio equality act, royalty rates, webcaster]Carbon Credit Investigation
From FT.com, an article about the carbon-credit scam.
The FT investigation found:
■ Widespread instances of people and organisations buying worthless credits that do not yield any reductions in carbon emissions.
■ Industrial companies profiting from doing very little – or from gaining carbon credits on the basis of efficiency gains from which they have already benefited substantially.
■ Brokers providing services of questionable or no value.
■ A shortage of verification, making it difficult for buyers to assess the true value of carbon credits.
■ Companies and individuals being charged over the odds for the private purchase of European Union carbon permits that have plummeted in value because they do not result in emissions cuts.
Even without investigations like this, isn’t it obvious that the carbon-credit industry is a joke? If emitting carbon dioxide hurts the environment, why would planting trees hours later or investing in “greener” energy sources fix that damage?
Tags: [carbon credits, carbon dioxide, carbon emissions]Net Radio discussion at S&R
This past weekend, I did more writing in response to a post about the recent internet radio ruling at a site called Scholars and Rogues. I don’t know the site that well, I just happened to come across it while I was checking out blog posts on the subject of internet radio at Technorati. I don’t think enough is being said for the “other side” of the internet radio royalty ruling, and I mean those that don’t believe that internet broadcasters should be able to use the government to set royalty rates on music. Below you can read are the comments I wrote that best explain my position on this issue.
5. Darren - April 21, 2007
I don’t see how this ruling will stop internet radio.
What’s at question is who gets to play whose music and under what terms. Normally, a webcaster would have to obtain permission from the owners of any music they play. Whether you agree with it or not, this board is a way for webcasters to get around seeking permission and to play the music for a rate that the board sets. Even though the board may have changed their rates to a level that most webcasters can’t afford, webcasters still have the option of playing music if they obtain permission.
It may seem that is is unfair that the rates were hiked so high, but shouldn’t the people who own the music decide what the fair price is? It’s no different than if, for example, you set up a garage sale and tried to sell your computer for $1,000,000. People may laugh at you and nobody will buy the chair, but it’s *your* chair and you get to decide what it is worth *to you.* The same applies to the RIAA and all music they own. Whether one likes it or not, when a musician signs a contract with a big label to sell the rights to their music, the big label owns the music. And the big label gets to decide what they will charge for it.
No matter what the RIAA does, people are still free not to buy their music, musicians are free to give away their music instead of sell it to the RIAA, and webcasters are still free to play music of those that have given them permission.
8. Darren - April 21, 2007
Webcasters may believe the royalty rate was fair, but the owners of the music the webcasters were streaming did not. I believe that only those who own the content should get to decide the royalty rates that are charged for that content.
I don’t see a major difference between webcasters who think they should be able to publish music for free and those who are willing to pay last year’s royalty rates. One will pay the artist *something,* but both accept the premise that they should get to stream music without obtaining permission of the artist. If one really wants to stand for the rights of artists (or for all individuals, for that matter), they should reject that premise.
I think that the RIAA has made it pretty clear that they think webcasters should have to pay more to play the RIAA’s music. Therefore, they are raising their rates. Webcasters can take it or leave it.
11. Darren - April 21, 2007
The RIAA owns the rights to all music it purchases from the artist. Once the artist signs a contract that transfers the ownership rights from the artist to one of the music labels, the RIAA has the same rights to that music as if they created it themselves.
This actually is an extension of the artist’s right to own whatever he or she creates. Artists have the right to trade their product to anybody they want for any amount of money. If the government’s copyright board were to step in and take away the RIAA’s right to sell their product, it would be the same as if they took those same rights from the artists. The government would be telling the artist (or RIAA, or whomever else owns the music), “You may not sell your music for that rate, it’s too high. Internet broadcasters only want to give you 0.0001 cents per play, and what they want is more important than what you own.” Who really loses in this deal?
The RIAA is always made to be the bad guy, but the RIAA has one thing over webcasters that are pushing this “Save Internet Radio” campaign: The RIAA won’t take an artist’s property if he or she don’t want to sell it to the RIAA. The RIAA respects the rights of the artist, because it’s those same rights that allow the RIAA to function as a business at all. Webcasters, on the other hand, will try to compel the government to *force* content owners to sell their products at a lower rate. Webcasters are right in one respect: Only one side in this debate is really looking out for the rights of the artist.
20. Darren - April 22, 2007
[…]
That’s what the free market is really all about. It’s more than people buying and selling things for money; it’s also about respecting individuals and their rights to their lives and their property. We might not like or agree with what people do with their stuff, but we have to respect their rights. That’s the principle I’m talking about. If you think that streaming music over the internet is important enough to violate those rights, then we don’t agree in principle at all.
[…]
Tags: [intellectual property, internet radio, riaa, royalty rates]Kings of Content
I think Corey Deitz is missing the mark overall in this article, but he does have some valid advice for webcasters who can’t afford the new royalty rates.
From “Becoming King of Their Content“, Dietz wrote:
What Webcasters Can Do
The answer is simple: find content that is not tied to any royalty structure.
Any webcaster can survive who originates his/her own content like talk shows, instruction, news, original music, etc. If the only thing you can do is stream someone else’s music, then quite honestly you haven’t been offering anything that can’t be obtained somewhere else.
I would change one thing here, though. The problem is not that a webcaster doesn’t offer something that can’t be obtained somewhere else, it’s that it is owned by someone else.
Tags: [internet radio, royalty rates]Congrats Google, You’ve Made It
Congratulations are due to Google! Once people start talking about whether the government should restrict what a company in what it can do because the company is too big, you know you must be very successful.
Note that the author says that Google has grow so quick while being “fair in square,” but that the government still needs to step in. Now the only thing that is missing is the attempts to demonize Google, but I’m sure it’s coming.
Tags: [google, government regulation, hatred of the good]The Apprentice Finale
The Apprentice used to be my favorite show. I started watching it during its second season, and I loved how it was a reality show that was actually based in reality. The tasks contestants had to complete each week were business-related tasks that showed how they would perform in the job they were competing for. The show really was a long job interview. However, as each season passed, it seemed that quality of the contestants kept dropping, and each finale meant less and less. In fact, the last two years I wished Donald Trump would have hired neither finalist (though I really enjoyed Randal’s awesome refusal to give up his title, a rare display of rational selfishness on national TV).
The show’s decline accelerated this season. Not only was the candidate pool relatively poor, the entire show became more gimmicky. For example, the losing team had to sleep outside in tents, and the project manager of the winning team stayed on until they lost (instead of just exempting them from being fired the next week). To make it worse, the length of the season was cut short by one week, which put four finalists into the final show rather than the usual two. And to top it off, the woman who won tonight had never been project manager throughout the entire process.
I’ll be surprised if the Apprentice comes back for another season.
Tags: [apprentice]Peter Schwartz on CNBC
Peter Schwartz appeared on CNBC early this week to talk on the issue “Going Green: Bad for Business?” He debated Michael Ewall from the Energy Justice Network. Schwartz made the argument that the purpose of environmentalism was to save nature from man, and as such it is the exact opposite idealogy of business. Enwall argued that capitalism was good for dictators and pollution and had to be restrained before it destroyed our environment.
Obviously, I agree with Schwartz. I also wish that when environmentalists says that “we” need to find “creative solutions” to our “energy problems,” they’d say exactly what they were for: government regulation.
You can click here to watch the video.
Tags: [capitalism, energy, environmentalism, government regulation, peter schwartz]Dr. Seuss Appeaser cartoon
I was really surprised to see this Dr. Seuss cartoon drawn during WWII. This man seemed to understand how ridiculous the policy of appeasement was better than most people today.
Tags: [appeasement, cox and forkum]