I just ran across this video from the NYT (below). This is another very interesting reflection of the strong trend towards content delivered as software. Just like bands and record labels deliver their music on iPhone apps (and even charge for it much like a CD), the NYT now delivers their content to any computer that can run Adobe Air - and I just love the way they put this - good going, NYT!
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I blogged on this crucial development here; and just found this video to share.
Image via CrunchBase
The UK / EU web is buzzing with the news that Youtube (Google) has started to block or remove UK music videos because they have not been able to strike a new music licensing deal with the PRS-For-Music, the UK rights society which represents the songwriters and the publishers. I particularly like the coverage of this issue by TelecomTV.com, here, but a lot more links to other coverage can be found below.
As is my habit, at times, I want to quote and comment. Before I get started, though, I want to point that obviously I don't know the terms of the license that were suggested by either Youtube or the PRS, so therefore I cannot comment on whether either one of them is realistic or not. I just know from my own experiences (among many others, with the now defunct - RIP - Sonific) and from many other deals that I have observed, that very often the respective proposals are 20-50x apart, i.e. one party may suggest 1 cent per stream while the other party wants 20-50 cents - mostly, simply because they can; after all, the rights holders enjoy the protection of having the exclusive rights to license their songs. I would not be surprised if that was the case, here (my exact guess is something like 10:1)
Anyway, here we go, from TelecomTV.com "Yesterday YouTube announced that it was going to take down all the premium music content currently available to UK YouTube users because it had failed to hammer out a new licensing deal with the UK's Performing Rights Society (PRS) for Music, a notoriously hard-line royalty collector. YouTube said the PRS wanted more royalty payment for each video view than YouTube could ever make from the ads situated next to each"
My comment: this points to the root of the problem, right away. Any deal between the mighty Google and the still-trying-to-find-the-right-$-model Youtube and the rights-holders' representatives has to be about sharing the revenues that are actually achievable, in the market, here and today, and jointly building a system that can generate more and more revenues, tomorrow and beyond. Again, as Larry Lessig says, and as I have proudly annexed from him, it's about Compensation Not Control! To the PRS: NO, you cannot have both - and it looks like you just decided against Compensation???
Unfortunately, this detrimental mindset has become a default seeting: many if not most of the rights societies in the so-called developing world, and now apparently the PRS, too, have adopted one of these 2 strategies: a) if a potential licensee is still too small and economically insignificant to warrant their consideration, they will not offer any license at all, unless it neatly fits one of the existing templates b) if a potential licensee is large, juicy, popular and financially connected to an entity that seems to have verrrrry big pockets (see Last.fm, Myspace, Youtube, Facebook... maybe), they will ask for the moon and try take them to the cleaners. Even better if that entity has been previously in-breach of the existing licensing traditions and regulations - more leverage is always a good thing, right? Just study the mind-boggling story of my favorite web-radio service, Pandora. Never mind that this kind of 'it's my right and I will fully exploit it as I see fit' - thinking is also pretty much what has gotten us into this horrible economic crisis, as well - but that's another story.
None of this has anything to do with real, honest and open intention of building a mutually beneficial and future-oriented model, and everything to do with what I like to call Economic Egoism that is effectively set in stone i.e. law by some outmoded laws from over 20 years ago. As long as rights organizations -whose tasks it is to license music not to forbid its use - are pursuing this strategy we will not get to a point of 'peace' with all those new entities that clearly want to use, and pay for their music.
The PRS published a very revealing statement when Youtube announced their decision to play hard-ball and remove the music videos - here is the nugget: "Google had revenues of $5.7bn in the last quarter of 2008". What does that have to do with negotiating the fair and equitable licensing rates for music? PaidContent.org has some great comments on this issue, interviewing YouTuber Patrick Walker, including this one: "to suggest that, because Google’s a big company, we should just suck it and pay a ridiculous rate is not something that we’re going to stand by...it’s hard for new models to emerge when the starting point is a massive loss on a per-stream basis".
In fact, I believe that this kind of attitude from rights organizations, publishers and record labels will most certainly lead to government intervention, sooner rather than later, since a dysfunctional market is not good for anyone - and clearly, this is what we have now, and it appears to be here to stay. I think... I have said it before:)
So here is my message to the PRSForMusic (as they are now called) and their members (hopefully they have a say in this, too): pleasssse get off this bizarre and decidedly Web 0.0 idea that Google should now be paying for everything that you think has been 'stolen' from you on the Internet. Instead, give YouTube a flexible, open, transparent and realistic license that gives everyone room and time to MUTUALLY develop this model, going forward. There is nothing to be gained by refusal! Start to cooperate rather than to try to dominate these conversations. COMPENSATION NOT CONTROL. And do it now, or have somebody else force you to.
More: Techdirt's ueber-brain Mike Masnick comments: Google has simply pulled music videos down in the UK. Basically, Google is making the point to PRS: you need us much more than we need you". The UK Telegraph has a few nice quotes (even though I don't agree with their conclusion that Youtube has a lot more to lose than the songwriters)
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Read about the Presidents of the United States of America: Bands bypass iTunes by streaming music through iPhone apps - Ars Technica: "If you're a Presidents of the United States of America fan, you can now
listen to the band's entire discography for a mere $3, but not through
the iTunes Store. Fire up your iPhone and grab it from the App Store
instead; the band has bypassed the record label bureaucracy and
released everything on its own..."
This is clearly a very cool idea, and something I have been looking at for quite some time: in the dawning age of rapidly exploding mobile app stores, on 5+ platforms, and with something like 2 Billion always-on smart phone users, we can now start selling music as software packages, i.e. in any UI/UX, multimedia, online/offline format that fits the artists' specific users and locations. Bands and artists, their managers, agents or labels and even publishers can select any combination of audio, video, pictures, texts, news feeds, games, twitter updates and social media 'rivers' to update the bands fans at any time, anywhere in the world.
My hunch is that most artists will probably have basic free versions available, at first, followed by premium apps that offer considerably more value and will cost from a few extra dollars all the way up to even $50 per user - and most importantly, lots of up-selling will be fueled through these apps. Think live concerts webcasts and downloads, premium video footage, remote backstage access, preferred access at concerts, merchandising etc - once I am hooked on the band, using this app, I make the perfect case for pitching something else to me.
I have said this a few 1000 times in the past, but here it is again: Music as a service (i.e. get / buy / bundle access first, and only then buy products), and now, Music as mobile software packages may well be the next format after the CD.
Take it a step further and think of how advertisers, brands and other partners could (and will) sponsor or co-present these apps, and therefore align with artists that make a good match with their branding strategy (see Groove Armada & Bacardi, Sting & Jaguar), and pretty soon most mobile music apps will be free or as I like to say, Feels like Free, for the users. Of course, downloading i.e. the ability to keep music must be part of it, as well - especially in the developing countries where easily available wifi/wlan is not that far along quite yet. I would expect that this will be part of many premium mobile music apps very soon. Stay tuned - this is a major trend, for sure.
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Image via CrunchBase
Read: E-Commerce News: E-Commerce: Amazon: Only Copyright Holders Can Unzip Kindle's Lips.
This is an interesting debate that once again shows that many rights holders will need some serious hand-holding when it's about understanding new technological implementations. I think this will be a major task, and very powerful if somewhat tedious opportunity, for the likes of Amazon, Google (Youtube), Yahoo and Facebook (yes... why? Stay tuned!) and very soon, the big agencies such as DDB, Ogilvy and Saatchi, as well as for all those Telecoms that want to play in the content & experience business (and which one does not?).
The creators and rights holders urgently need to understand and embrace the web-fueled paradigm of 'giving something' in return for 'getting something' - and the increasing empowerment of the people formerly known as consumers (aka the users) means that the creators will have to give more before they can get something back. Some people would call that the pressure of the Attention Economy - but this is the undeniable reality of the hyper-connected and mobile world we now live in, and it is not something we can switch on or off as we see fit. Ignore this trend at you own peril - witness the music industry's refusal to give more value before the purchase, and where it has taken them.
Now, Spotify, Last.fm, Myspace and iMeem provide free music on-demand, Hulu and Youtube provide free TV shows on-demand, Amazon and Google let people search-and-read-inside-the-book. And now the new Kindle will allow you to listen to a robotic voice rendition of a book - hardly a competition with the audio book, I would argue. In fact, this feature would probably drive people towards buying more audio books - free added values convert to sales based an getting better interfaces and higher quality. Sounds familiar?
This whole debate is very much like, years ago, the issue of Amazon's Search-Inside-The-Book feature. After a lot of deliberation, the publishers found out that the new feature really did increase sales (I think by something like 10%) and what's more, it got a lot of people 'addicted' to the book right there and then - which is usually the best way of snagging a new customer.
I think that Amazon should consider offering an additional, small monetary incentive to the publishers as well as some clever reporting on who is listening where (based on opt-in), and maybe even some promotional, highly targeted audio 'advertising' options to the participating book publishers, and thereby sweeten the deal.
But most importantly, the publishers need to start looking beyond their constant fears of cannibalization of existing revenues, and look at all these new options with less toxic assumptions (as social media expert and fellow bloggerati Neil Perkin likes to calls them). In addition, drastically lowering the price on digital books (the audio versions, too) would go a long way in boosting the take-up of electronic reading. And beyond that: what if you could use Kindle to have actual conversations with the readers - wouldn't that be a boon to writers and publishers?
The bottom line: switch to Openness and find new revenues. Now. Look at Nokia / Symbian, Firefox, Apache, Adobe, Android... Openness is tough but it always wins the users.
Ceck out this video on 'Compensation not Control' (MidemNet 2009)- this Lessig-inspired meme applies here, too!
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Image by gleonhard via Flickr
I sure hope I am not telling you anything really new here, but in any case: to everyone out there - if you have not yet claimed the perfect twitter user name for your venture, company, location, service or blog yet - such as, in my case, twitter.com/gleonhard - you should do so now. Yes, like, right now. It's already happening but I predict that very soon this trend will really explode, and Twitter names will be registered, squatted, bought and sold like domains used to be, not so long ago. I myself own about 10 or so names that I am using or plan to use, such as Dailywisdoms and FutureFeed. Unfortunately I was asleep at the wheel for a while, myself, as far as Twitter is concerned, and missed the unique chance to get about another dozen or so names that I really should own such as 'thefuture' ;) - so much for successfully predicting the future (or, rather, acting on it;) So, get to it! Note: you need a new email address for each twitter account that you want to register.
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Great read: FT.com / Digital Business / Digital Britain - The world in your pocket.
“In 2009, mobile phone users are expected to download more than 10bn applications to their mobile phones – the majority from sites managed by mobile device manufacturers, consumer electronics firms and software houses.”
"After years of disappointment and false starts, mobile data and the “mobile internet” it enables, finally seems to be taking off. “Global sales of mobile broadband ‘dongles’ [plug-in gadgets that control wireless signals] exceeded 4m a month during 2008 and are expected more than to double in 2009,” says Deloitte. “The resulting stress on networks, particularly backhaul connections, could be significant..."
“We do expect to see a proliferation of music, video and gaming applications being consumed on mobile devices...In all of these cases, next-generation services utilise the broadband networks from the mobile operators, but importantly bring together the capabilities of the communications network and the web to create next-generation experiences"
Marty Beard: “We will see voice over the internet (VoIP), video messaging, streaming, cross-operator presence and other new and innovative services. The expansion towards an all-IP mobile economy has begun.”
Image by gleonhard via Flickr
A god read: Across Irish Sea: two bold tactics against music piracy | csmonitor.com.
This is a good review of the Isle of Man plans to make music sharing on the Internet legal. I was asked to comment on this; here are some excerpts:
“The logic is quite straightforward: You find a way of creating a payment within the network,” says Gerd Leonhard, a media futurist and author...Although a similar idea failed in France in 2006 amid a fierce lobbying effort by the recording industry, Mr. Leonhard has long argued that if the recording industry licensed Internet networks with a flatrate for streaming and downloading music, then advertising and other subsidies would be able to cover the entire CD business. He doesn’t even think the Isle of Man’s tax is necessary.
“The payment of about €1 [$1.28] per week, which we have been debating in Europe as a flat rate, is entirely possible to raise through the ecosystem. The music won’t be free, but it will feel like free,” he says, in an interview from Austria. Business models like Leonhard’s are becoming more feasible as concert tours, merchandise, and endorsements become more lucrative than recordings. “When Prince gives away his CD away with a British Sunday newspaper, he knows that he will be guaranteed three sold-out shows. That is worth more to him than the recording,” Leonhard says...."
Author and futurist Leonhard says the recording industry is fighting an uphill battle: “The tactic of criminalizing users hasn’t produced any money. The industry needs to look for compensation, not control.”
Read this:::: Davos09: A crisis and failure of leadership « BuzzMachine. Jeff offers some real nuggets here, and so does Richard Edelman with his 10th Trust Barometer (video below, sorry for the bad sound... it's UGC I guess)
Image via WikipediaThis is a good read: Is music's future on the Isle of Man? - International Herald Tribune.... not just because they quote me (that's a good start, though;) but also because it's a pretty summary of the issues. I paraphrase:
"The island, a rainy outpost in the Irish Sea, is promoting an offbeat remedy for digital piracy, which the record companies blame for billions of dollars in lost sales. Instead of fighting file-sharing, the government wants to embrace it - and it is trying to enlist a skeptical music industry in support....Under a proposal announced this month, the 80,000 people who live on the Isle of Man would be able to download unlimited amounts of music - perhaps even from notorious peer-to-peer pirate sites. To make this possible, broadband subscribers would have to pay a nominal fee of as little as £1, or $1.37, a month to their Internet service providers"
"A lot of people in the business are concerned with how much money they are losing, but not with how much money they could make," Berry said. Under his proposal, the money collected by the Internet providers would be sent to a special agency that would distribute the proceeds to the copyright owners, including the record labels and music publishers. They would receive payments based on how often their music was downloaded or streamed over the Internet, as they now do in many countries when it is performed live or on the radio. The Isle of Man didn't invent the idea. The concept of a so-called blanket license to distribute music in digital form has been discussed since the days when Napster, before its rebirth as a legal service, thumbed its nose at the music industry"
"While the Recording Industry Association of America, which represents the major labels in the United States, has backed away from a nearly six-year campaign of litigation against individual file-sharers, the music companies' continuing effort to battle piracy in other ways dismays some analysts. "They spend 90 percent of their time trying to keep me from doing what I want to do and 10 percent of their time trying to make it possible," said Gerd Leonhard, author of "The Future of Music."
Read it and spread the word using the tools below;)
If you were at my MidemNet presentation in Cannes / France, today... here it are my slides (I will add more details later... it's 2.30 am now ;). Hopefully MIDEM will make the entire video available soon, as well. Be sure to check the MidemNet blog for updates (and the Kyte channel! 3MB PDF: Compensation not Control Music 2.0 Gerd LeonhardMIDEMNet 2009 low res
High resolution version viewing and downloading via Slideshare:
Youtube is removing unlicensed (i.e. ... all!) music from user-generated videos. Wow. See my previous post. Here is what I think about that:
Mashable: YouTube Now Mutes Videos With Unauthorized Copyrighted Music. "Perhaps this has been going on for a while, but I’ve never noticed it before. YouTube
users often create an original video using their favorite popular song
as the audio. I’m afraid that they won’t be able to do that much
longer, since YouTube has started muting videos that use unauthorized
copyrighted music (and that pretty much means all user-created videos.) You can see some examples here, here and here. The official notice from YouTube under the video says the following: “This video contains an audio track that has not been authorised by all copyright holders. The audio has been disabled.”
Ouch. This will really hurt. Everyone. The amateur film makers, the artists, Youtube, us - the users. Yes, sure, I know: synchronization [the use of music in a public audio-visual production] is subject to a license by the writer, publisher, label, artist (and another dozen of parties), no matter how small the use. That's the law.
BUT: where will this by-the-book implementation of these laws lead us? The answer is: criminalization.
Youtube (i.e. Google) will be virtually destroying 10s of millions of videos that millions of users have created and uploaded. I understand why Youtube would comply with demands for this, but this is really a bummer - would it not make sense for the music (publishing) industry to instead provide a non-commercial LICENSE for UGC content, and in return get traffic, referrals and shares of ad revenues? Would it not make sense for such a license to be created NOW rather then in 3 years?
Another instance of music industry control obsession that just makes you want to scream if you haven't lived under a rock for the past 5 years. When is Compensation FINALLY going to be more important then Control?
PS: Mashable rocks. Read their blog!
UPDATE
Norwegian Dagbladet comments Techcrunch rips into this topic ReadWriteWeb
Larry is doing a great job here, standing up against Stephen Colbert's bizarre verbal ambushes - a must watch: "This is Artistic Socialism" Via ZDNet.
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