With A Choice Between $100 Million In Cash & Fantasyland, The Labels Choose Fantasyland
from the revenue-vs.-piracy dept
I keep having the same conversation over and over again with people in the recording industry. A few days ago, I met with the head of a record label that is doing all sorts of cool and innovative experiments (both on the business model and with technology) and he still kept saying “but we gotta stop people from stealing.” The problem, as always, is that they seem so focused on infringement that they miss the bigger picture: What does it actually mean for revenue? These are two separate questions, and the labels seem to prioritize the wrong one. They want to stomp out infringement at any cost, even if the net benefit is minimal.
If record labels were given a choice whereby they could support a new revenue stream that would bring in, say, $100 million without them having to do anything… vs. getting no such revenue and playing whac-a-mole with a few more “pirate sites,” just making them move elsewhere and not actually get anyone to buy anything, they’d have to be crazy to not go with the $100 million option.
It appears they’re crazy.
Google was clear, when it launched its Google Music, that it wanted to do much, much more, but that the things it wanted to do required licenses from the labels. However, the terms the labels offered were completely unacceptable. Now it’s being reported that Google offered $100 million to the labels, and a key sticking point was that the labels wanted Google to wave a magic wand, figure out who was “pirating” music, and stop it. In other words, $100 million vs. Fantasyland. And the labels went with Fantasyland.
Filed Under: licenses, music lockers, streaming
Companies: google
Comments on “With A Choice Between $100 Million In Cash & Fantasyland, The Labels Choose Fantasyland”
But…But isn’t fantasy-land right next to candy-land and who doesn’t like candy.? Taking a stab their type of thinking, if Google is willing to pay 100 million that has to mean that it’s really worth 300 million plus and Google is trying to make money of their hard work. So by that estimate when you include Apple, Microsoft and few minor players that’s 1 billion plus out there. They will always stick to fantasy-land because of delusional belief of what they assume the value is. They don’t want anybody making a buck unless they can get their 70 to 80% cut some how.
Re: Re:
IT’s only 30%, but yeah, Fantasyland is still MagicalChristmasLand.
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30% is Apple’s cut of the sale? The rest is the records co. cut.
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You’re right. The copyright industry plays a zero-sum game. It cannot stand the mere thought of someone else making money from their precious content.
Which is exactly why the movie industry is trying to kill netflix. Even though netflix offers a legal alternative to piracy. Given the choice of netflix making money or losing sales on piracy, the movie industry will chose the lost sale.
The carriage makers will starve...
and so goes every industry. The world only recognizes one rule when it comes to business. Change or die.
Re: The carriage makers will starve...
Or be acquired.
Re: Re: The carriage makers will starve...
that’s either a change or a death, depending on what angle you look at it from.
Re: The carriage makers will starve...
Its actually, adapt or die.
Re: Re: The carriage makers will starve...
True, but most people thinks it’s change or die so used that.
Re: Re: Re: The carriage makers will starve...
define most?
Fawk’em
And they want tech solutions
Big Tech just offered them $100 million when they didn’t have to give them a dime and they turned it down. I would personally take that solution any day, especially when it is a solution to a problem I don’t have.
Re: And they want tech solutions
There’s a certain bitter irony at work here.
Google does nothing because it is in Google's interests to do nothing.
There is no fantasy. Google could easily demote the overwhelming majority of pirate links if they wanted.
Do you really not remember this story?
http://www.nytimes.com/2010/11/28/business/28borker.html?_r=1&hp
Google got criticized because they were promoting popular retailers in their search results who were mistreating customers. Within ONE WEEK they reworked their search method to incorporate an “algorithmic solution”.
http://googleblog.blogspot.com/2010/12/being-bad-to-your-customers-is-bad-for.html
How long has piracy been a problem on Google? What attempts have they made at an “algorithmic solution”?
Google enjoys promoting piracy because the law doesn’t force them to do otherwise, and promoting piracy makes them money.
Pretending it is a technological problem is ridiculous. It would be a technological problem to block all piracy. But the overwhelming majority of piracy is so blatantly out in the open, you could hit it algorithmically easier than the broad side of a barn.
The top 50 pirate sites aren’t even remotely ambiguous about what they are “sharing”. They’re clear as day. That’s why they’re so popular.
Re: Google does nothing because it is in Google's interests to do nothing.
The top 50 pirate sites aren’t even remotely ambiguous about what they are “sharing”. They’re clear as day. That’s why they’re so popular.
Do you think they would go away if they didn’t show up in search results? Do you really think piracy depends on Google or any other search engine?
Re: Google does nothing because it is in Google's interests to do nothing.
But you miss the point. Google changed the algorithm because it was hurting the credibility of the their search results. If the public lost faith that Google will return credible and useful search results they would start searching elsewhere.
There is no threat of their credibility being compromised with pirate sites. Moreover why would they take the time to block them off? The law is clear, it’s not Google’s issue; the record labels keep crapping on Google so why are they going to try to help them?
Re: Re: Google does nothing because it is in Google's interests to do nothing.
Oh, I get the point exactly. And it seems so do you. Google is doing what is best for Google. Piracy is good for Google’s business.
Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
Oh FFS, this again?
They blocked the word “torrent” from autolink. There’s nothing in an autolink that actively stops a person from searching for what they intend to search for. That can be the word “bit torrent”, The Pirate Bay, or Your mom.
If Google actively blocked words, not actions, from their search do you know how much of a censorship stink would be raised?
Stop wasting time with frivolous BS. People know the word torrent. They know the Pirate Bay exists. Put two and two together, in that people will go to the Pirate Bay when they want to.
And get out of the fantasy that Google owns the internet enough to wave a magic wand and stop people.
Re: Re: Re:2 Google does nothing because it is in Google's interests to do nothing.
The word torrent is legitimate and has multiple meanings.
Even with searching for bittorrent software or content available through bittorrent, that content might be legitimate:
Ubuntu 11.04 torrent
Re: Re: Re:2 Google does nothing because it is in Google's interests to do nothing.
Why would Google have to block the word ‘torrent’? They didn’t have to block the word ‘glasses’ to demote the glasses retailer who was abusing clients.
The point of an algorithmic approach is it uses a HEURISTIC to detect what is appropriate to promote and what is appropriate to demote. It is the same approach Google uses to demote Content Farms and Spam websites.
No keyword filtering is required.
Re: Re: Re:3 Google does nothing because it is in Google's interests to do nothing.
That’s what they did
And judging from the recent sessions, it’s really fruitless to arbitrarily promote/demote sites like that.
First, who would deem a site a pirate site? The AG as proposed in the PIPA legislation? That’s been in Korea for a while. How has that turned out?
Wouldn’t the better alternative be to, ya know, put up your own copyrighted work and compete?
Seriously, Google gives so much to working on preventing people from using bittorrent that I’m sure it’s going to bite them in the end.
Finally, just think about the wrongful takedowns of Youtube because you have the OPENID system in place. It’s utterly dumb for little return when the better way of doing business is to focus on what you and your company do best.
Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
Google is doing what is best for Google. Piracy is good for Google’s business.
Are you the same Anonymous Coward that last week said that most “regular” users weren’t pirating and sharing music?
For the sake of argument, let’s say that piracy is good for Google’s business (no idea if it really is or not, and you can’t know for sure either). Doesn’t it follow that piracy is not limited to just a few tech geeks? That the average user is more than likely participating in the sharing of culture? That your views that more copyright is always good is not the view of the majority? That suing and alienating the majority of your customer base is a bad thing?
How much cognitive dissonance can you really stand before your head explodes?
Re: Re: Re: Google does nothing because it is in Google's interests to do nothing.
Google is doing what is best for Google.
They look after their own self-interest, yes. So does every business on the face of the planet.
It’s not Google’s job to make record labels money, especially not when the recording industry makes such a big production out of villainizing Google.
Re: Google does nothing because it is in Google's interests to do nothing.
Definitely, the world would be better if Google magically stopped indexing “pirate” content and instead there would appear a ton of alternative search engines for “pirate” content exclusively. Oh wait, they’re already there. And they sure will be happy to take over some of Google’s market share. Because, as we all know, killing Napster stopped piracy, and killing Limewire stopped it again. Maybe crippling Google will help too.
Re: Google does nothing because it is in Google's interests to do nothing.
Google changed their algorithm because companies were taking advantage of how the algorithm worked to get ranked higher. That is a far cry from somehow algorithmically “detecting” that a site contains so-called pirated material.
Re: Google does nothing because it is in Google's interests to do nothing.
Hey piracy was thriving in before Google’s creators were outta high school, or is it your that belief that piracy never existed till Google was created?
Re: Citation needed...
…please list these 50 sites.
Re: Re: Citation needed...
Ask ICE, they should know.
Re: Google does nothing because it is in Google's interests to do nothing.
Google is big content’s favorite mole to whack.
Re: Google does nothing because it is in Google's interests to do nothing.
STFU.
You’re so dumb that you don’t even understand that changing their Algorithm would be a technological change to how the site works… Get a damn education.
Re: Google does nothing because it is in Google's interests to do nothing.
What I find most amusing is this fantasy that one business gets to tell another business how to /do/ business. ANYone tries to tell the entertainment industry how to make money, and people like you come whining and crying and pointing fingers, insisting that OTHERS need to change.
The simple fact of the matter is that you need to change, because you cannot force everyone else to do so for you. That isn’t how the world works.
root problem
In their minds, I think that the enormous cost of fighting piracy is worth it, once they find the “solution”. That is, the labels think that with enough tries, sooner or later they will find the magic bullet that kills off piracy. For good.
The problem is, of course, that even if they (by some miracle) manage to “solve” the problem of piracy, it won’t stay that way. It’s not a one-and-done kind of problem. Within days of most any “solution”, the collective internet can and will have found some sort of way around it. Or else they’ll invent a new method.
If you’re sticking your fingers in your ears like the labels and don’t recognize that fact, suddenly their efforts seem more … well, not well thought out, but less crazy at least. Even if it cost them a few billion in sales to stop it now, if they manage to “stop it” for good all they have to then do is artificial scarcity to bring all of that money back to them.
Re: root problem
“Murder is against the law. People still murder other people. We can’t solve the murder problem so it is pointless to try.”
Glad I don’t live your world.
Re: Re: root problem
I’m not sure I follow you … are you saying the record labels are murdering people and so we should be trying to stop them?
Or are you trying to draw a parallel whereby copyright infringement is interchangeable with murder?
What am I thinking … of course you aren’t comparing copyright infringement and murder … you would have to be FUCKING RETARDED to make that comparison.
You’re not FUCKING RETARDED are you?
Re: Re: root problem
For starters, you suck at analogies. Aside from that, I’m not entirely sure that we are trying to solve the murder problem.
We’re all about (rightly) punishing murderers. But I seriously doubt the laws are there with any real intent on prevention. The main two types of people who would murder a) feel no qualms about it, so if they don’t mind murdering someone they don’t care about some arbitrary law made by a government they likely don’t care about, and b) do it because of some momentary emotional or mental overload (they get extremely angry, paranoid, etc) and aren’t able/willing at that particularly moment to worry about the law anyways.
Having said that, there’s not much in there related to my point. I mean, if you want to go that route, I could say that the RIAA doesn’t go after potential aliens who might exist and might be listing to music that sorta kinda sounds like it might be similar to something created by a human, during a drunken college party, so since the aren’t suing the alien asses off those Plutonian Pirates for all of their Plutonian dirty money, the RIAA really doesn’t care about stopping piracy. And we all know that’s the trtuh, cause the RIAA is all about peace, love, and screwing others over. Amirite?
Re: Re: root problem
“Murder is against the law. People still murder other people. We can’t solve the murder problem so it is pointless to try.”
Glad I don’t live your world.
So now infringement not only equals theft but murder? Glad I don’t live your world.
HAHAHAHAHAHAHAHAHAHA :out of breath: HAHAHAHAHAHAHAHA :takes another deep breath: HAHAHAHAHAHAHAHAHA
Well, after all the bad will they have generated, I am more than happy to watch them implode. How long do you think successful artists will WANT to be with them if they are turning down 100 million in revenue and refusing to license their music?
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You are presupposing that artists would see even one dime of that hundred million.
That hundred million will be eaten up with administrative fees, and other fees, and fees for collecting fees, and investments in ongoing anti piracy efforts.
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It’s important for you guys to lie a lot, isn’t it? Like the constant lie that musicians don’t get paid.
That’s a huge lie. They get paid a ton when they sign with a label. It’s called an advance. They use the money to live on and pay to make their album. It gets paid back via record sales.
Which they can’t do as well because you rip off music.
And them.
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I wonder if anyone can make an algorithm to filter out stupid comments? Then I wouldn’t have to read your shilling/drivel.
Re: Re: Re:2 Re:
With spam we have spam filters … I wonder if a drivel filter would have a market.
Re: Re: Re:2 Re:
Say the word and I’ll work on a Greasemonkey script to filter out comments like these. I’m a programmer on vacation and have already finished all of my books.
Re: Re: Re:3 Re:
Writing a script that accurately (almost zero false positives and not too many false negatives) filters out “stupid” comments would either be A) impossible or B) worthy of a doctoral computer science thesis and maybe some international prizes in artificial intelligence research.
I’d lean toward A, since humans can’t even agree on which comments are stupid. However, if you would like to filter out all Anonymous Coward comments, or all comments by any list of users, you can use this script:
https://docs.google.com/document/pub?id=1_DWYEIhgMK54_sBDMj5UnuW0bHmdADnCY3099_9ffFg
Re: Re: Re:4 Re:
I was thinking more along the lines of putting a little clickable X near each comment that would hide the block level element. Sorry if I implied that some sort of AI would be involved. I had more than enough of neural networks as an undergrad, it was not fun.
Re: Re: Re:5 Re:
Oh, now that is a good idea. Feel free to use my script as a starting point, it really should be most of the work done already. If I don’t beat you to it. 🙂
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Points to this
http://www.nydailynews.com/gossip/2011/05/31/2011-05-31_lady_gaga_i_went_bankrupt_and_was_3_million_in_debt_after_extending_my_monster_b.html?r=gossip
Please explain how piracy is to blame for this? The dam thing grossed over 220 + million.
Re: Re: Re:2 Re:
Just something to think about:
This might be part of the problem
Oh, and the fact that her label gets a 360 deal on her licensing. She does all the work, they get all the profit. Truly stunning…
Re: Re: Re: Re:
Advances are expected to be payed back. The recording industry doesn’t invest in bands, they loan money indiscriminately. The recording industry takes 90% of the money right off the top and puts that other 10% towards the loan.
So saying that artists get payed a ton when they sign with a label is like me saying my bank gave me my house when I signed the mortgage. It’s a half truth, though it is expected from the recording industry.
Re: Re: Re:2 Re:
More lies.
Of course.
No artist in their right mind would sign a deal where they only got 10%.
You people don’t seriously think that by lying about record labels you justify your stealing, do you?
Re: Re: Re:3 Re:
Anonymous, IT’S NOT A FUCKING LIE! There have been NUMEROUS artists coming out and saying that is about how their contracts work.
The recording companies keep 90%, they get 10%.
Re: Re: Re:3 Re:
It’s damn near common knowledge that the “advance” you advocate is what keeps artists indebted to labels.
James Brown, Michael Jackson, Lady Gaga, ALL of them had to deal with that as a “price to pay” for stardom?
Where have you been the last 30-40 years?
Re: Re: Re:3 Re:
sigh….. thats like saying people wouldn’t work if 30%-ish got taken from their pay check and went towards killing people,
but yet i still see people working
the thing is its the only way to work in this country legally
Re: Re: Re:3 Re:
Anon: In fact, it’s not a lie. That’s exactly how it works. Labels give the artist a loan. With that loan they pay for their album to be made. Unlike regular loans however, all the money made from albums sales doesn’t go towards paying it off. The artist then makes royalties on album sales (between 10 and 20 %) and those royalties go towards the advancement. Until the advancement is paid off the artist doesn’t see another dime. Do a Google search, and you’ll come across this.
Now does this justify piracy? It depends on who you ask since each person only needs their own level of justification. Me personally.. I just started listening to music licensed under Creative Commons. Why don’t we talk about that more often here?
“In their minds, I think that the enormous cost of fighting piracy is worth it, once they find the “solution”. That is, the labels think that with enough tries, sooner or later they will find the magic bullet that kills off piracy.”
My view is that piracy is the by-product of them trying to explain why didn’t they make more money or diverting blame from themselves. If piracy were eliminated they move on to radio saying that people aren’t buying our music when they can listen to it for free. So lets charge radio even more money. They will keep moving to the next thing till the they come back to the first thing and keep going around.
Re: Re:
> If piracy were eliminated they move on to radio
> saying that people aren’t buying our music when
> they can listen to it for free. So lets charge
> radio even more money.
They’re already trying to charge radio for money.
They’ve all but killed Internet Radio.
The 100 million is in trade for perhaps a 7 billion dollar industry. Why would they want to make that trade?
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Oh I don’t know, maybe because they weren’t due even one cent so getting $100 million for nothing is a pretty good deal in my book.
Re: Re:
You said “perhaps” in that sentence, there. Again, industry numbers out of nowhere. Why is it Google’s problem that the industry can’t bring a possible 7 billion dollars to the recording industry? The labels certainly aren’t coming up with any ideas.
Re: Re:
Wow, I have to admit I’ve never heard that line of reasoning before.
Get your bad guys straight, please. It seems you’ve gone from “BUT, BUT PIRACY!” to “BUT, BUT MUSIC LICENSES!”
Re: Re:
If I offered you a deal for $100,000,000 and you didn’t have to do do anything other than sign a piece of paper, would you turn it down because I might make $7 billion? That would be insanity, you know. The labels can’t leverage their content to make that kind of money off of it. If someone else can, and they can make a tidy profit in the mean time, then that would be a good idea.
As it is, they turned down the money because of pride and jealousy, not business acumen. These are decisions that should get people fired. These are decisions, based solely on stubbornness that work directly against share holders j- they are faith-based beliefs that have no place in business.
The fact that someone in such a high position in a corporation can keep their job while making decisions that actually go against making money because of what they *want* to be true is dishonest to the people whose money they are losing.
Re: Re:
The trade isn’t 100 million for 7 billion dollars of profit. They are basically asking you to take their hundred million dollars to generate good will. Google probably doesn’t need you to agree. They have money to fight and are on some pretty solid legal ground.
Your choice is take their money and show you can play in the modern age, or let others continue to eat your lunch.
Re: Re:
The 100 million is in trade for perhaps a 7 billion dollar industry.
So, despite all the supposed harm of piracy to their industry it’s still in the billion range? Talk about high-level griping.
What we really need to do...
Google should just BUY the big labels. Problems solved. Shut the mf’ers down and get things moving in the right direction.
Re: What we really need to do...
“Google should just BUY the big labels”..
Why would you want these morons working for you? All the executives are under contract as well possibly owning stock options. It might cost you more to get rid of them then what the asking price would be and to top that off the slim bags would probably group back and tell the artists how to get outta there contracts and sign up with their new hell spawn they would create after leaving Google.
Re: Re: What we really need to do...
All the executives are under contract as well possibly owning stock options. It might cost you more to get rid of them then what the asking price would be
How about this: buy the labels, including all the copyrights. Send all the executives home. Keep paying them if they don’t want their contracts bought out, just don’t let them work (this might still be cheaper than dealing with the labels as they are now). Disband the RIAA. Sell the music for 10 cents per song. Don’t worry about piracy. Profit.
to top that off the slim bags would probably group back and tell the artists how to get outta there contracts and sign up with their new hell spawn they would create after leaving Google.
I don’t see how that would hurt Google. If some artists are really dumb enough to want to sign up with these guys after everything we’ve seen them do, then let them. Google can’t protect musicians from themselves.
Am I Missing Something
I must be missing something. Why are all the labels and other industry types focused on Google? Google is not infringing. Can anyone tell me why these industries are not putting their efforts into going after the actual infringers? Just because it’s hard, doesn’t mean it can’t be done.
Re: Am I Missing Something
Somewhere along the way, the recording industry decided that “technology companies” like Google are “pro-piracy,” because they don’t kowtow to frivolous industry demands, like when they refuse to censor their search results at the demands of Big Media.
Re: Am I Missing Something
“I must be missing something. Why are all the labels and other industry types focused on Google? Google is not infringing. “
Because they operate under the assumption that you need to have 100% control of the product pre/post sale. If you don’t someone can out maneuver you and come up with new and innovative ways for people to get what they want. That’s what Google is trying to do.
Re: Am I Missing Something
“Can anyone tell me why these industries are not putting their efforts into going after the actual infringers? Just because it’s hard, doesn’t mean it can’t be done.”
Forgot to answer this part and simple to answer. They don’t want spend(or justify) money on something that’s not going to directly make them money. Why spend a million dollars going after these sites if you can take that money and give it to some lobbyist so they can get our government to make stupid laws and spend tens of millions of dollars to do their dirty work. Since we all know government money is free money why not use it.
Re: Am I Missing Something
“Why are all the labels and other industry types focused on Google?”
Somewhere in the vast interwebs was a story which reported that the labels accepted that there would be a large amount of copying in the digital era – sneakernet, Direct Connect hubs in dorms, etc. What the labels say they can’t live with is easily searchable unauthorized downloads, where the unauthorized copy becomes easier to find than the authorized copy. (I’m passing along a distant memory of Big Content’s point of view, remember.)
“Can anyone tell me why these industries are not putting their efforts into going after the actual infringers?”
Because they number in the millions and chasing that swarm is not cost-effective. It’s also really bad public relations.
“What the labels say they can’t live with is easily searchable unauthorized downloads, where the unauthorized copy becomes easier to find than the authorized copy. (I’m passing along a distant memory of Big Content’s point of view, remember.)”
LMAO
Sure they wanted to give people options that made sense to the consumer and build up brand loyalty. Instead of jamming all types BS down people throats with there take it leave it approach.