US Trade Rep Promises To Review Transparency Policies

Politics

from the well,-that's-a-start dept

After the highly questionable claim that the US Trade Representative couldn’t release details over the secretive negotiations concerning the ACTA proposal because it somehow involved state secrets (though plenty of industry lobbyists were given access), it looks like the USTR has agreed to review its policies on transparency. It’s definitely a good thing, but the USTR also says that the process will take a few months. It’s unclear how that may impact ACTA, but it seems like the USTR could easily review just that particular decision before reviewing the entire process.

Filed Under: acta, transparency, ustr

French Lawmakers Trying To Regulate File Sharing Don't Know Much About It

Politics

from the required-classes dept

We’ve joked in the past that judges and politicians should be required to pass some sort of “class” on certain basic technology issues before they’ll allowed to rule on lawsuits or create regulations having to do with technology. All too often we find that many of the problems created in the courts and legislatures are due to politicians simply not understanding technology. It looks like that’s true around the world as well. Over in France, where politicians are pushing hard for a three strikes law, a reporter went and asked some politicians some basic questions to gauge their understanding of the technology in question — and found that most had absolutely no clue. Combined with the fact that approximately 90% of people in a recent survey were against the law, and that the European Parliament has said any such law would be a violation of a user’s civil rights, you have to wonder how politicians can possibly justify such a draconian law.

Filed Under: france, p2p, regulators, technology literacy

So Much For That Plan: Google CIO Doesn't Even Last A Year At EMI

Failures

from the whoops dept

Nearly a year ago, we were surprised, but hopeful when it was announced that Doug Merrill, former CIO of Google was joining EMI to head up its digital initiatives. It definitely seemed like the big record labels could use a nice injection of Google-style thinking — though, we were worried that Merrill would be pigeonholed as a “techie” rather than someone integrated into the wider strategy. And, indeed, watching EMI continue to make a series of self-destructive moves left us wondering how much influence, if any, Merrill had on the firm. Just a few weeks ago, we pointed out that Merrill should be ashamed to be associated with a company that is actively stomping out innovation left and right.

Who knows what the real reason is, but it looks like Merrill didn’t work out at EMI. Less than a year after taking the job, Merrill is no longer employed by EMI. Neither side is talking about why — though EMI said something about how it’s unnecessary to have a separate “digital division.” That goes back to our original fears: suggesting Merrill was limited just to digital issues, rather than overall strategy. But, the fact that he’s totally gone from the company so quickly suggests that perhaps he tried to shift the direction of the company and was unable to get very far. That’s a loss for EMI and the big record labels, who never seem to miss an opportunity to make things worse for themselves.

Filed Under: digital, doug merrill
Companies: emi, google

Just Because You Can Do A DMCA Takedown Doesn't Mean You Should…

Legal Issues

from the think-twice dept

Many lawyers are taught (or learn from experience) to approach any legal issue by going to an extreme position, on the assumption that eventually there will be a negotiation with opposing counsel and a settlement will get worked out somewhere in the middle. That often made the most sense in many cases, but it doesn’t work very well in lots of situations online today. And that’s part of the reason we see, time after time, companies reach for the legal nastygram solution when an open conversation would work just fine. The latest example of that: Boing Boing alerts us to news that the site Apartment Therapy was the recipient of a DMCA takedown notice (actually, to be accurate, the NYT’s lawyers went over their head and straight to their hosting company). At issue were blog posts on the AT site, which linked to the NY Times articles, but also used images from the Times’ site.

There may be a fair use claim that could be made, but even if we ignore that and assume that this is, absolutely, infringement, the entire approach by the NY Times doesn’t make much sense, and is representative of that “attack” line of thinking. As AT notes, if the NY Times had just approached them and asked them to stop using its photos, it would have. But, instead, the lawyers had to send a DMCA legal nastygram. Even then, it’s difficult to see how this makes sense. The AT posts were designed to get people more interested in the NY Times’ articles, by giving them a taste and sending them to the site. Why would anyone at the NY Times want to stop that? And that’s especially true after the NY Times was just on the opposite end of a recent lawsuit. If people had just looked at this reasonably, rather than taking the default legal position, the NY Times might have realized that this site benefits rather than harms them, and even if they had felt otherwise, realized there was a much friendlier way to approach the situation.

Filed Under: dmca, takedown
Companies: apartment therapy, ny times

How Come SoundExchange Is Holding Onto Over $100 Million?

Legal Issues

from the questions,-questions,-questions dept

We’ve talked about the ridiculousness of the various music collections societies being involved in the discussions on new music business models. To them, the answer is always the same: add another license and let us collect it. They’re middlemen and they take in tons of money and would only be all too happy to take in more. Some got upset with us in the comments, by noting that some of these collections societies are non-profits. In fact, the new Choruss offering, which we’ve already explained why it’s a bad idea that’s more of a bait-and-switch than anything useful, has been described as a similar “non-profit” collections group.

But, as we’ve noted in the past, supposedly nonprofit collections groups such as SoundExchange (a spinoff of the RIAA) are notorious for not finding artists to pay — even some of the biggest names in the business. Oh, and did we mention that if the royalties go “unclaimed” the recording industry (via SoundExchange) often gets to keep the money? Given that bit of info, it’s perhaps no surprise at all that P2Pnet is noticing that SoundExchange’s own tax returns note that the nonprofit was sitting on over $100 million at the end of 2007, a pretty significant leap over previous years, and a somewhat startling sum for a supposed “nonprofit” in charge of both collecting and distributing funds.

It seems like those musicians sure are difficult to find.

The P2Pnet report also points out that it will be interesting to see how much SoundExchange has spent on lobbying efforts. SoundExchange is actually barred from lobbying the government, but has been ignoring that for years by funding musicFIRST, a recording industry lobbying group that’s trying to add a new license for radio stations to pay (collected by SoundExchange, of course) by claiming that radio is actually a form of piracy.

So, even if Choruss or these other collections societies seem to be designed with the best intentions in mind (and I’m sure they are), it seems that they’re wide open to abuse — which is yet another reason to be quite worried about simply handing over the entire industry’s business model to such an operation.

Filed Under: collections, money
Companies: choruss, soundexchange

Two And A Half Years Later, Wii Shortages Start To Let Up

News You Could Do Without

from the still-no-wii-fit dept

The shortages that accompanied the launch of the Nintendo Wii weren’t too surprising, since they seem to be par for the course for any new game console these days. What was a little surprising was just how long the shortages lasted after the Wii’s late 2006 introduction. If you still haven’t had a chance to find a Wii in-stock, your wait should soon be over, as an exec from the retailer GameStop says they “finally have enough inventory on the shelf” (via Engadget), and the shortage of Wiis should be letting up. Clearly the Wii has been a huge hit, but it would seem that Nintendo could have gotten a handle on its production output in less than, eh, two and a half years. There’s also speculation that the weakness of the dollar was leading Nintendo to send Wiis to places like Europe with stronger currencies (and hence more profits when Nintendo converts foreign currencies back into yen). Or did Nintendo just leverage the scarcity so it would contribute to the Wii’s appeal?

Filed Under: shortage, wii
Companies: nintendo

Live Concerts Can't Support The Existing Recording Industry… But Did Anyone Ever Say They Would?

Culture

from the one-piece-of-many... dept

Whenever we talk about the importance of freeing the infinite and charging for the scarce when it comes to music, we end up having people try to simplify that down to “make money on concerts.” That’s never been true, however. While we do think performances are one scarcity that is worth exploring, and which has proven to be quite lucrative for many performers — both large and small — we’ve never thought that live concerts alone would suffice as the business model. There are other, more important scarcities, such as access and attention, that can be much more lucrative. Still, it’s worth exploring how well live concerts alone could do in replacing recording industry revenue, and in a long (80 pages) and thorough paper by Mark Schulz (a law professor), exactly that exploration occurs (thanks to the anonymous reader who sent this in). It’s well worth reading, as there’s plenty of food for thought. Basically, he points out that free file sharing can help many artists in numerous ways, but he’s not convinced that touring alone can help. He goes through a pretty thorough explanation for why touring alone isn’t enough — including the fact that a disproportionate amount of the profits from live performances tends to go to a rather small number of artists, just as the number of musicians creating music is exploding.

While I think the paper is worth reading, and makes a ton of good points, there are a few problems with it. First, I don’t know many people who seriously think that touring alone would be the new business model. Most people think that it’s one component among a variety of new business models that are available. And, indeed, Schulz is good about mentioning some of the alternative additional business models out there. But, then he sort of ignores them in going back to discussing how touring alone isn’t enough. It’s sort of a nice strawman, but it’s besides the point, since almost no one really believes that touring alone is the model. Then, there’s the issue of extrapolating out from the existing “touring” market, most of which really looks at bigger tours, rather than at the market for local bands playing local shows. And, while he does include a discussion on making the live performance business “more productive,” I’m not sure he really takes into account some of what’s been happening — such as the efforts Jonathan Coulton puts into building up a critical mass in a certain area before parachuting in for a live performance. The ability to do such things only will grow over time, and not enough attention is paid to them. In fact, we’re already seeing live music bring in more money than recorded music in some markets.

So, while it’s a very good paper, and I agree with the overall strawman conclusion (touring alone isn’t enough to replace the entire recording industry revenue), I’m not sure that’s meaningful or really tells the full story. Touring does and will continue to work incredibly well for some bands, it will be a component of other bands’ business models, and it won’t be a part of others’. But there are plenty of different business models that can deal with that.

Filed Under: concerts, music industry, recording industry

Security Researchers Shouldn't Face DMCA Liability While Protecting Users From Faulty DRM

Legal Issues

from the no-brainers dept

Longtime Techdirt readers may remember Alex Halderman, who conducted influential research into the problems created by CD-based DRM during his time as a grad student here at Princeton. He’s now a professor at the University of Michigan, and he’s working on a new project: seeking a DMCA exemption for security research related to defective DRM schemes that endanger computer security. We’ve seen in the past that DRM schemes can open up security vulnerabilities in users’ computers, and Halderman argues that the public would benefit if security researchers could examine DRM schemes without being threatened with litigation under the DMCA for doing so.

The DMCA gives the Librarian of Congress the power to grant three-year exemptions for DRM circumventions that are perceived to be in the public interest, and one of the exemptions granted in the 2006 triennial review was for CD-based DRM schemes that create security problems. Alex points out in his filing that the most serious security vulnerabilities created by DRM since that rule-making have come not from CD-based DRM but from video game DRM, which has not been adequately studied by security researchers. A ton of prominent security researchers (including Alex and my mutual advisor, Ed Felten) have endorsed Alex’s request, arguing that the threat of DMCA liability hampers their research. We hope the Librarian of Congress is listening. If you live near Palo Alto or Washington, DC, you can sign up to testify about Alex’s proposal (or others) by filling out this form.

Filed Under: copyright, dmca, drm, liability, research

A Look Back At The Worries That Google Would Never Make Money

Predictions

from the oh-look-at-that... dept

Last week, in response to Clay Shriky’s wonderful look at journalism business models, I wrote a post about the fact that you can’t wait for the perfect business model. I was amused to find some comments pushing back on this — including one that specifically pointed out that Twitter and other social networking companies could never make any money. In response, I pointed to both Google and Craigslist as companies that were once in the same spot, but the commenter insisted that was ridiculous, because both had business models.

This is retrospective thinking. It looks back on things and pretends that it was obvious how Google and Craigslist would make money. It was not.

Craigslist was mainly a hobby for Craig Newmark for a while — and every part of it was “free.” It was only later that a business model was developed. And the situation was even more crazy with Google. I have admitted in the past that I never thought Google could make enough money to survive — and it was something I was very, very wrong about. But, at least I wasn’t alone. Howard Lindzon points us to an article from 2000 in Business Week fretting about Google’s ability to come up with a real business model. Business Week wasn’t the only one. I remembered a similar article in Wired, and just dug it up. It ran in October of 2001, and pointed to the huge dilemma Google had in proving to its VC backers that it was a good investment. Some quotes from both articles:

But how will Google ever make money? There’s the rub. The company’s adamant refusal to use banner or other graphical ads eliminates what is the most lucrative income stream for rival search engines. Although Google does have other revenue sources, such as licensing and text-based advertisements, the privately held company’s business remains limited compared with its competitors’. — Business Week

The dilemma? Behind the anti-corporate facade, Google is in fact a company – even worse, a venture-backed company – and these days that means it must find a route to profitability fast or risk failure. Given that its far more commercial competitors, from AltaVista to Ask Jeeves, have been unable to come close to positive territory (the one moneymaker, Yahoo!, started as a directory), Google’s prospects might seem bleak. — Wired

This doesn’t mean, of course, that sites like Twitter and Facebook will definitely find business models. But, it should give you pause before assuming that they can’t. Business models often seem obvious in retrospect, but at the time, it’s not clear at all. I wouldn’t put it past the team at Twitter to come up with something that works (I’m a bit less sure of the team at Facebook… but we’ll see).

Filed Under: business models, history
Companies: facebook, google, twitter