The Trichordist’s War On Rethink Music

On July 14th of this year, Rethink Music released a report called “Fair Music: Transparency And Payment Flows In The Music Industry.” The report is available to anyone who provides a name and email address, and can be downloaded here:
http://www.rethink-music.com/download-page

Rethink Music is an initiative of the Berklee College of Music, specifically their Institute for Creative Entrepreneurship. Their goal is to explore options in the music business; they’re hardly anti-copyright crusaders, and their focus is on working artists.

Yet, the Trichordist has spent multiple blog posts attacking them. In the end, their attitude seems to be this: “You don’t attack digital music services enough, so we’ll attack you.” And in the process, Trichordist made many claims that were misleading, and sometimes downright bizarre.

So, I’m going to use this post to tell the truth, at least as I understand it. I would post replies on the Trichordist site itself, but they actively censor any comments that don’t kiss their respective asses.

The Phantom Google Connection

It would be cheritable to say that the Trichordist does not approve of Google. In fact, the Trichordist is often a vehicle for anti-Google propaganda, rather than a blog about artists’ rights. Most of the Google stories on the Trichordist site (all of which are negative) have little or nothing to do with artists or musicians.

So, it’s hardly a surprise that the very first post about Rethink Music’s report takes a tenuous Google connection, and misrepresents it to imply that Google is behind the report.  From the post Even More Transparent: 5 Omissions From Berklee College/Rethink Music’s Report:

Report Funding by Kobalt Music.  Kobalt Music is a Google Ventures company.  Google owns YouTube.   Maybe that’s why they didn’t mention Youtube.   Google runs the ad networks that serve ads on these services.  Maybe that’s why they didn’t mention the ad acquisition costs.

There’s more. From the post NCES “Transparency Report” on Berklee College of Music:

The Trichordist is all for transparency and we agree with many of the reports findings, even if it is funded by our frenemy Kobalt Music (a Google Ventures company). […]

I find it odd that Kobalt Music (Google Ventures) would go to an institution that spent $0 on research in the last year for a major research project. Where is their research staff? What is their expertise? Who wrote this report? There are conclusions in the report that are based on anonymous sources. How would anyone verify the conclusions? Was any of this peer reviewed? I could go on and on. IMHO this looks more like one of those inside the beltway pay to play reports not a serious academic study.

Like many of the Trichordist’s “criticisms,” this is obviously nothing other than argumentum ergo decedo (a.k.a. the Traitorous Critic Fallacy). And unsurprisingly, the rest of that particular post is nothing other than an ad hominem attack on the Berklee College of Music itself. For “evidence” of their ad hominem attack, they link to an NCES “study” – but the link is dead, and to get the relevant information, you have to generate data yourself at the IPEDS site. (So, no, not a “study.”) Moreover, the article does not compare Berklee’s statistics to the statistics from other music schools.

Not that it would make any difference whatsoever. Things like graduation rates, tuition assistance, and what have you, have zero to do with the report itself.

As to the accusation that Kobalt is “a Google Ventures company,” even a minimal amount of research will show that this claim is largely bullshit.

In fact, Kobalt was founded in 2000 by a young Swede named Willard Ahdritz, who was also the founder of Telegram Publishing. On the other hand, Google Ventures was not founded until 2009 – Kobalt had already been in existence for almost a decade.

But Google Ventures did not invest in Kobalt Music Group until February of this year (2015), for a Series C round. And they were not the only investor, nor did they provide the majority of that funding:

Along with Google Ventures, previous investors MSD Capital — the private investment firm of Michael Dell — is also participating. It brings the total of equity raised by Kobalt to $126 million, and this sits alongside a further $153 million that the company has raised to help finance a second strand of its business — label services where Kobalt either buys part or all of an artists’ rights to help collect royalties on their behalf. The company has invested some $100 million of that fund to date.

Kobalt Tunes Into $60M Led By Google Ventures For Its Music Rights Collection Platform

As far as I can tell, the “further $153 million,” mentioned in that quote, did not involve Google Ventures:

Michael Dell’s private investment firm, MSD Capital, is taking a 9.9% stake in Kobalt, a 13-year-old company that says its advanced technology makes collecting royalties more efficient and lucrative for the songwriters the company represents. MSD paid about $25 million for the stake, according to people familiar with the matter. MSD declined to comment on the price. […]

The company’s backers include Balderton Capital, a European technology-focused venture capital firm. The original capital was provided by Spark Ventures, which sold the last of its stake to MSD.

Michael Dell Takes Stake in Music Publisher Kobalt

There is absolutely no evidence – none whatsoever – that Google Ventures (much less another Google property like YouTube) is determining Kobalt Music Group’s advocacy positions. In any case, Kobalt is certainly not “a Google Ventures company.”

Further posts are equally as conspiracy-theory oriented and misleading. For example, in the post Another Misleading Rabbit Hole from Rethink Music @berkleecollege, the Trichordist also brings up a Google “connection:”

As one might suspect from an organization backed by the Google-funded Berkman Center, the “transparency report” contains recommendations that are both highly beneficial to the tech industry and entirely out of touch with reality.

The Berkman Center is run by Harvard University. Like Kobalt, they have existed longer that Google Ventures. In fact, the Center was founded in 1997, a year before Google was even operating out of Susan Wojcicki’s garage.

And they are careful not let their donors influence them in any way:

We are committed to autonomy in our research and transparency in our relationships. These traits are essential to our continued credibility and success as an institution. Our funding model is possible due to the robust, strict, and clear policies that govern our association with donors and preserve the Berkman Center’s intellectual independence.

Our research and outreach modes depend substantially on being able to convene and engage parties that span the spectrum of viewpoints, and for our research results to have impact, our work must not only be intellectually rigorous, but also fair and impartial.

To that end, we do not accept grants that limit our ability to carry out research in the way we see fit – free of outside influence and consistent with our organizational mission and values. We do not undertake research or accept funds at the request of outside organizations unless it is consistent with our existing research agenda, mission, and overall philosophy. We are transparent about our funding sources, announcing the receipt of funds through our normal communication channels.

All corporate donors agree to give their funds as unrestricted gifts, for which there is no contractual agreement and no promised products, results, or deliverables.

Funding & Support Policies

Also on that page, you can find a list of financial supporters (past and present). Google is just one of sixteen entities who support their current activities; others include Microsoft (a member of the anti-Google group FairSearch), the Ford Foundation, the Getty Foundation, the MacArthur Foundation, USAID, and the U.S. Department of State. Past activities had support from a huge number of donors, including Google competitors like Oracle (another FairSearch member), a huge number of tech companies, and many many more non-profit foundations.

You can have whatever opinion you like about the Berkman Center’s studies, but if you imply that it is shilling for Google, then you are lying.

That same Trichordist article goes on to make more conspiracy-theory claims about online gambling. (The author calls this “Very Googley,” though Google had absolutely nothing to do with any of it.) I won’t go into those claims here – it would take another thousand words – but you can do your own research (or just actually read the links in the Trichordist article) to realize that it is also misleading bullshit.

And, of course, how this has any relevance whatsoever to Rethink Music is beyond me. There’s no “there” there.

Misleading Rabbit Holes About David Goldberg

The next Trichordist post was called Berklee’s Misplaced Reliance on Sony Pictures Hack. It is about an email exchange between Dave Goldberg, former head of Yahoo! Music (sadly deceased), and Sony CEO Michael Lynton. That exchange was part of the Sony leak, and the Rethink Music report quotes part of it.

From the title, you would think that the report bases some of its major conclusions on this email – that it was central to their recommendations. In fact, it was not; it was used anecdotally. The email exchange could have never taken place, and the only way the report would have changed is that it would be shorter by one paragraph.

Here’s the quote from the report. Apologies for its length, but I think it’s important to put it into context:

Equity Stakes And Service Payments

Major labels also have equity ownership shares in most streaming services. Labels often license their catalogues at sub-market rates in exchange for a share of ownership in the company, based on the theory that streaming services need lower rates to grow and reach critical mass. This would be fine, except these ownership shares, when monetized, are never paid to the artists who receive lower stream rates in return for “supporting” the service in its infancy. Further, labels are also rumored to negotiate multimillion-dollar annual “service payments,” charging streaming services for their catalogues as a whole, without attribution to individual works. This complicates things further, since it makes it impossible to determine fair per-stream rates in light of the other exchanges taking place, using artists’ works as leverage.

Major labels currently own stakes in companies like Spotify and Rdio, although percentages may change with each company’s round of funding. A 13 percent ownership stake in Beats Music, resulted in a payoff to Universal Music’s parent, Vivendi, of $404 million in 2014 when Beats was acquired by Apple for $3 billion. It is highly doubtful that any of this $404 million made its way back to artists, especially since the ownership was at the parent level, above Universal Music. In a rather comical moment discovered in the Sony email hack, we see that when Digital Music News published an April Fool’s hoax article on April 1, 2014, reporting that Google had acquired Spotify for $4.1 billion, a thread of emails among Sony finance executives expressed their delight. “If this is true, they should notify us ASAP so we can exercise our rights under the Voting Undertaking Agreement,” wrote Susan Meisel of Sony Music, with others asking, “What is our percentage interest?”

Notwithstanding, Sony has at least considered how to move more solidly into the digital realm. Also released in the Wikileaks emails was a memo requested by the Sony CEO from recently deceased Dave Goldberg, former head of Yahoo! Music, about how to pivot the company into a revamped all-digital enterprise. “The record company needs to act like a music publisher for new releases – putting up very little money but not trying to hold artists for long contract periods or to keep as much of the revenue. Advances would be $50,000 with a 40 percent revenue share after the advance… Most fixed headcount in new releases will need to be eliminated, artists will need to be paid quickly and transparently, deals will need to be simple and fair and catalog replenishment is the only goal of the new release business. Artist contracts that have large fixed marketing costs will need to be restructured or sold off as there will no longer be headcount to do the work. New releases will be tested on consumers before added money is spent to ensure that it isn’t wasted. In short, the new release business will become like an independent label.” To date, these recommendations have not been implemented.

In response to some of these issues, TIDAL has emerged as an alternative streaming service. [&etc. Emphasis mine.]

So, as you can see, the entire context of the quote was about transparency in the deals between labels and streaming services. It was not about how major labels could restructure themselves to become more profitable. The important points, as far as I can tell, were the parts I emphasized.

Of course, the Trichordist focuses on none of that. Instead, they take issue with how Goldberg suggests Sony should restructure its business:

Here’s the gist: Goldberg wants to convince Michael Lynton that Sony Music essentially should be converted into a catalog company because most of Sony Music’s revenues come from catalog. That’s right–Goldberg wanted to more or less eliminate the front line catalog and just keep the back line catalog. With no thought given to how…the front line hits…become the back line hits….rut roh.

They do a follow-up post on the same topic, called Another Misleading Rabbit Hole from Rethink Music @berkleecollege. And, again, they didn’t discuss label or streaming service transparency at all.

Perhaps you agree with Goldberg’s plan, or perhaps you agree with the Trichordist instead. But it doesn’t matter either way. Nothing in either of these posts invalidates – or even addresses – anything in the Rethink Music report.

It is nothing but a misleading rabbit hole.

As an aside: the Trichordist article says that the hack was “allegedly by ‘North Korea’.” Note the scare quotes. The idea that North Korea is behind the hack is the official theory, endorsed by the FBI. Lowery, on the other hand, calls this “laughable and unsubstantiated,” and seems to believe Google was behind it:

Healey has been quick to spread the laughable and unsubstantiated rumor that North Korea is behind the Sony Hack. […] My suspicion is that his clear sympathies for those who profit from piracy at the expense of creators (Bittorrent and Google) makes him hope that this act of economic sabotage has not been committed by one of his fellow travelers.

LA Times Editor Jon Healey’s Ode to Bittorrent: Did he Coordinate Earlier Editorial with Bittorrent?

I mention this just in case you didn’t already think Lowery was a conspiracy theorist.

(Oh, but speaking of conspiracies, here’s an interesting tidbit: in the Lowery piece, the word “Google” was a link to the Digital Citizen’s Alliance. This is the astroturf “nonprofit organization” behind Project Goliath, as reported in the New York Times: Google’s Detractors Take Their Fight to the States. See? I can use the Traitorous Critic Fallacy too!)

Misrepresenting HFA’s Role

Update: I now realize that a lot of this section was wrong on my part. Spotify (and others such as Tidal) did, in fact, hire HFA to administer all of its mechanical royalties – they didn’t just use HFA to administer mechanical royalties to only those songs by HFA affiliates.

This was pointed out to me in the comments, and I apologize for not listening. I had assumed that the stories that broke this news, were referring to direct contracts between HFA and licensees like Spotify, for HFA’s own catalog. Direct deals with HFA have always been required for large licensees.

This is the way things have worked for the past century. So far as I know, before music users like Spotify and Tidal signed these deals with HFA, HFA didn’t do any kind of work like this at all. They certainly didn’t as late as the 90’s or early 2000’s.

The fact that the HFA is so inexperienced about being a universal rights clearance service – e.g. the HFA didn’t send out NOI’s to anyone, due to its publisher contracts, as quoted below – is almost certainly why the music publishing industry is in such a mess right now with regards to digital streaming. But that’s another story, and one that has already been covered elsewhere.

Part of the Rethink Music report deals with the Harry Fox Agency (HFA). I’m betting most of my readers will know who this is, but just in case you don’t, here’s an explanation.

There are two general “categories” of music copyrights: copyright in compositions (the “underlying song,”) and copyright in sound recordings (actual recorded performances of that song). HFA only administers copyrights in compositions. They have this in common with PRO’s like ASCAP and BMI. By the time a work reaches the public, the copyright in a composition has almost always been assigned (“sold”) to a music publisher by the songwriter in exchange for royalties; thus, HFA’s clients are almost exclusively publishers. HFA calls them “affiliates.” Self-published songwriters can’t become HFA affiliates.

However, there are several related rights in a copyright to a composition. There is a copyright in a reproduction of a composition (e.g. when a record label presses a CD with that song on it), and a copyright in the performance of a composition (e.g. when a band covers a song in a venue). HFA only administers copyrights in the former; PRO’s administer rights in the latter. Historically speaking, HFA’s licensees have been record companies; more about this in a second.

The royalties that HFA administers are usually called “mechanical royalties,” and the royalty rates are set by Congress. (Those rates are currently about 9 cents per song, per reproduction.) Anyone who makes a reproduction of a song can do so by paying the mechanical royalty rates, without needing permission of the songwriter. They need only to file something called a “notice of intent” (NOI), and issue regular statements and checks. As I explained before, these statutory royalties were set up to prevent monopoly effects from granting copyrights to songwriters.

Publishers can make direct deals, of course, but since licensees never have to pay more than the statutory rate, they’ll have no reason to pay more, so direct deals are usually for lower rates. This is usually not in the best interests of publishers… unless, of course, the publisher is part of a record label, which is very common. HFA does not negotiate these deals, but they do administer the royalties from them (if the pulisher is an affiliate).

HFA has been around since 1922, and was set up by the National Music Publishers Association (NMPA). Since it administers mechanicals for the NMPA, HFA has a near-total monopoly on mechanical royalty administration. Their affiliates include all of the major publishers, and many many smaller ones; according to their website, HFA represents over 48,000 affiliated publishers. It’s also worth mentioning that HFA has its own royalty compliance service, which includes the right (by contract) to audit licensees.

You may ask yourself: if HFA only deals with things like CD’s, how are they involved with digital streams at all? The answer is that digital downloads, ringtones, and interactive streams are all subject to mechanical royalty rates. This includes streams from, say, Spotify, but not from digital radio companies like Pandora or SiriusXM (which aren’t considered interactive). The division of HFA that administers these royalties is called Slingshot.

Now, let’s take a look at the concerns about HFA in the Rethink Music report:

As an example, mechanical royalties owed by Spotify to the publishers for the use of their music are paid to HFA, which then distributes the monies to each publisher represented by HFA. If an artist’s publisher (usually smaller publishers) is not represented by HFA, the only way to collect mechanical royalties from Spotify is to make an administrative agreement with HFA or forge a direct agreement with Spotify, which could be a managerial nightmare.

Since organizations like HFA collect most of the mechanical revenues from streaming services on behalf of writers and publishers (and take a cut for their services), it’s worrisome that some royalties may be withheld from songwriters simply because they do not have an administrative agreement with HFA. When a mechanical-payment check does arrive, there may be a lack of transparency in the breakdown of what a writer or published is owed, or it may end up in the black box, with the money never reaching its rightful owner. That can be particularly problematic for songwriters.

This sounds like a valid point. Of course The Trichordist disagrees. In a post called Deflecting Blame Away From Spotify Berklee Gets it Really Really Wrong on Publishing, David Lowery (user “davidclowery”) writes:

First of all – I’d be surprised if HFA collects “most” of the mechanical royalties from streaming services due to various direct deals and compulsory licenses. But second, by law Spotify is the entity required to get licenses from songwriters and then pay and account to them. Not HFA.

The only reason HFA is involved is because Spotify hired HFA to license songs and send out royalty statements on their behalf. And from what I understand they are mostly obtaining compulsory licenses. That means that HFA is mostly sending (for Spotify) what’s called a “notice of intention to use” under the compulsory license clause of the Copyright Act (Section 115) and “certified statements of account” of the kind we’ve all received (remember those $0.01 checks). HFA didn’t insert themselves into Spotify’s business, Spotify invited them in.

First of all – HFA does (or at least, can) collect royalties from direct deals. And they certainly do collect royalties on compulsory licenses, because all mechanical licenses are compulsory.

But second, it’s misleading to say that Spotify “hired” HFA. They are licensees of the catalog administered by HFA. It’s exactly like saying Pandora “hired” ASCAP. What he’s probably talking about are businesses like Music Reports, which act as intermediaries between licensees and multiple kinds of copyright licensors: labels, PRO’s, SoundExchange – and HFA itself.

He is right that HFA files the NOI’s to the publishers. It is part of their Slingshot service. Of course, it is also HFA who issues licenses for the songs in those NOI’s. So if the NOI is defective, this is the fault of HFA, not Spotify – HFA shouldn’t have licensed the songs to Spotify until after the 30 days had passed. Of course, we can only tell if this happened if HFA is transparent about when they actually allowed Spotify to use the song – the premise that Lowery himself is criticizing.

There is more:

The workflow is pretty standard stuff these days. Spotify probably tells HFA what music they have used (likely violating federal NOI rules that require 30 days notice before use) and then HFA tries to match the song owners by song share to the songs used by Spotify. HFA sends out the NOIs (now likely defective retroactive notices) to the known copyright owners unless there’s a direct license between the publisher and Spotify (I haven’t read about direct licenses for Spotify so they’re probably using compulsory licenses for the most part).

Of course, these accusations are all complete speculation. My (limited) understanding is the HFA is in charge of sending out NOI’s to its associates, not to publishers that it doesn’t represent. I have found no evidence otherwise. And if that’s the case… well, see above.

But, here’s the really damning thing about this accusation. If Harry Fox grants a license for an interactive stream, the licensee is explicitly exempt from sending out NOI’s. This is specified in the Harry Fox license itself. From HFA’s terms of a license for interactive streams (PDF):

Upon issuance of this license, you shall have all the rightswhich are granted to, and all the obligations which are imposed upon, users of said musical work under the compulsory license provision of the Copyright Act, after phonorecords of the copyrighted work have been distributed to the public in the United States under the authority of the copyright owner by another person, except that with respect to Interactive Streams thereof made and distributed hereunder: […]

3. You need not serve or file the notice of intention to obtain a compulsory license required by the Copyright Act.

Lowery also says that Spotify is using his music without permission. This is, indeed, a serious accusation… if it’s true. He talks about it at length in the post Spotify’s Failure to License My Songs in US Illustrates Rethink Music’s Call For Transparency.

But, he never gives us one piece of crucial information: are his mechanicals administered by HFA? If so, then he has granted HFA the right to issue a license on his behalf.

And HFA apparently thinks that they are. You can search for songs covered by HFA’s licenses using HFA Songfile. And when I actually do a search for the music he listed, all of it comes up in Songfile, with associated HFA codes. Here are the first 15 results when I search for “camper van beethoven:”

Song Title HFA Song Code Writer
CIRCLES C03017 CAMPER VAN BEETHOVEN
SHUT US DOWN S05576 CAMPER VAN BEETHOVEN
(WE’RE A) BAD TRIP W02526 CAMPER VAN BEETHOVEN
SAD LOVERS WALTZ S05572 CAMPER VAN BEETHOVEN
THE HISTORY OF UTAH H01899 CAMPER VAN BEETHOVEN
ZZ TOP GOES TO EGYPT Z00075 CAMPER VAN BEETHOVEN
JOE STALIN’S CADILLAC J00774 CAMPER VAN BEETHOVEN
STILL WISHING TO COURSE S05574 CAMPER VAN BEETHOVEN
GOOD GUYS & BAD GUYS G01413 CAMPER VAN BEETHOVEN
FIVE STICKS F01622 CAMPER VAN BEETHOVEN
HOE YOURSELF DOWN H01898 CAMPER VAN BEETHOVEN
UNE FOIS U00418 CAMPER VAN BEETHOVEN
WE LOVE YOU W02527 CAMPER VAN BEETHOVEN
DOWN AND OUT D02185 CAMPER VAN BEETHOVEN
NO FLIES ON US N01229 CAMPER VAN BEETHOVEN

It seems Lowery is only proving that the Rethink Music report is even more accurate than anyone thought.

Transparency For Thee, Not For Me

This one is only a minor criticism on the Trichordist’s part, but it clearly shows their hypocricy. And yes, I do know that this is super petty of me to bring this up, but it really bugs me.

When writing about Goldberg, the Trichordist spat out this little parenthetical:

We have to assume the Berklee authors (whoever they are as none were given a “written by” credit that we could find) […]

It isn’t the first time the Trichordist has done this:

This all might be easier to understand if we could find a “written by” credit anywhere in the report so we could tell the authors biases. Particularly since the “report” is not peer reviewed in any traditional academic sense. There’s lots of acknowledgements that take the circular congratulatory award – more about them in another post – but if you can find an actual “written by” credit, please let us know.

If the authors couldn’t find this out, they weren’t searching very hard. This is the information in the “Acknowledgements” section:

Executive Director Allen Bargfrede has overseen Rethink Music since its inception in 2009. BerkleeICE Managing Director Panos Panay has been instrumental in providing guidance and support for the Rethink Music/Fair Music Project. Our research assistants, Griffin Davis, Klementina Milosic, and Anahita Bahri wrote a substantial portion of this paper, with editing assistance from Michael Dowding.

I have no idea what he means by “the circular congratulatory award,” but it does give the names of the people who are responsible for the text of the study.

But here’s an interesting fact. The articles above don’t credit any author. There’s no byline. The user who posted this article is named “thetrichordist.” There is no bio for this user (or any of the other users on the Trichordist).

On the other hand, other articles were written by user name “davidclowery,” who we can reasonably assume is David Lowery himself (despite the lack of byline). But Lowery (in a private email) berated me for thinking that “thetrichordist” was himself. Since the Trichordist bills itself as “a community blog,” this is not an unreasonable criticism. The problem is that, other than Lowery, nobody who actually posts to this “community blog” is identified.

So who is “thetrichordist?” It is the same account that selectively reposts articles from Music Technology Policy, Vox Indie, or what have you. Under the WordPress system, this requires a role of “Author” or above, which must be granted by a site administrator. Is this some kind of “community author account” set up for those other writers? Someone else who administers the Trichordist site (if indeed there is anyone else)? Lowery himself, posting under a different account? There’s no way to know.

What hypocrites.

Rethink Music Replies, Trichordist Lies

After the report had gotten some attention (including the “attention” given by the Trichordist), Rethink Music posted an update on Medium. You can view that here:
Music, Paid Fairly

David Lowery (user “davidclowery”) responded in an article called @BerkleeCollege Shows They Aren’t Serious, Responds to Our Criticism with Straw Man Argument. Unsurprisingly, he cherry-picks quotes from this article, giving the impression that it didn’t say things that it actually did. He also never linked to the original Medium post, so Trichordist readers couldn’t easily verify his claims.

Here’s how Lowery characterizes the Medium post:

Here’s what they say about our criticism in their follow up:
“Some have questioned the role of digital services in this debate. It is important to remember that most online music services pay 70% of their revenue to rights holders (except YouTube, who should be encouraged to pay more than their current 50%), and we believe that this technology for distribution is a good thing. It is impossible to put the “Internet genie back in the bottle” – let’s not forget that the main source of industry woes 5 years ago was piracy – and at least a business model has evolved that has people paying for music again”

Classic straw man argument.

We don’t think “the technology” is a bad thing, and we are not trying to put the “internet genie back in the bottle.” If you want to put it in terms of “internet genies” we are asking the internet genies to drop their NDAs and to exhibit more transparency on advertising revenues and expenses. This is clearly illustrated in the whiteboard photo above. Further the email record clearly indicates that Panay understands our criticisms. The only conclusion is that Berklee knowingly misrepresented our criticisms of their report.

This is classic demagoguing. Trying to neutralize your critics by dishonestly claiming they are saying something they are not.

In fact, this is not true. Conveniently, Lowery leaves out the remaining sentences in the very paragraph he quotes:

The services must, however, be transparent and pay creators fairly – part of the reason we also recommend a “fair music certification” for those who meet a specified level of transparency. They must also stop using creative techniques, such as Pandora’s attempted purchase of an FM station in South Dakota, to lower their royalty rates. Further, while it may be beneficial for labels and publishers to have equity stakes in digital services, this arrangement is not fair if the eventual payouts are not shared with the artists and writers who created the works that power the services.

Later, the Medium post also confirmed what should be obvious – that neither Rethink Music, nor Kobalt, are shilling for Google:

Fair Music’s intention is not to point fingers at any particular entities, or to engage in any subjective conclusions based on any underwriter or supporter who provides donations for the well-being of the college’s students, specifically Kobalt Music Group’s backing of Rethink Music. (In fact, Kobalt is already well known for their support of a transparent music environment and has generously helped to fund both scholarships for Berklee songwriting students and all of our Rethink Music projects and events, such as our annual Rethink Music Venture Days in Europe, since 2014, long before any investment by Google in Kobalt. Any rumors of Google’s involvement or influence on Rethink Music or the findings of the report are absolutely false.)

These points seem directed at the simplistic and insulting “Professor Whiteboard” post, and the other posts like it.

So, Rethink Music has not “misrepresented our criticisms of their report.” They responded to the few criticisms that were remotely valid. They just didn’t respond in a way that Lowery liked. So the Lowery ignored it, called them names, and misrepresented what they said.

Now that is “classic demagoguing.”

Update: Making Fun Of Graphics

Right as I was writing this, David Lowery made yet another post about Rethink Music.

It was a $100 prize to whoever could make fun of one of their graphics. No, seriously: the post is called $100 Dollar Prize! Be First To Illustrate all the Flaws in this @BerkleeCollege of Music Chart

Here’s what he said in it:

Well we must confess we’ve been laughing our asses off all day at these guys. Why? Because while Allan Bargfrede and Panos Panay have been busy taking the low road by suggesting we are luddites and comparing us to “birthers” (WTF right?), they’ve also been distributing digital royalty flow charts that are completely wrong . Guess they thought we stupid and ignorant artists wouldn’t notice.

For the record, if anyone at Rethink Music compared Lowery to “birthers,” it’s not in the Medium article. I also couldn’t find it on anyone’s Twitter feed.

In fact, doing a search for “David Lowery birthers” on your favorite search engine turns up only one other result. And that’s when David Lowery himself compared his critics to “birthers.” It’s one of his replies in the comments on his infamous Emily White shaming post:

Truth is you guys in the free culture movement don’t even know how to argue your own cause. You need to get off the “there is no evidence thing”. You guys are sounding like global warming, birther or 911 conspiracy nuts.

Stay classy, Lowery.

Update: I finally figured out what Lowery was talking about. Panos Panay (founder of Berklee’s ICE) left a comment on the “straw man” Trichordist post. Largely positive, it also included this paragraph:

We want to crowdsource the action and the crafting of this new environment. If the first iteration of what we are trying to do has gotten some things wrong, then let’s make them right. That’s why I did state to David that I in fact agree with some of the omissions that he stated and why we are interested in talking. But I am not interested in dogma or boogie men, I am interested in solutions and the way forward. (I will also not try to convince anyone that Google or Berkman had nothing to do with this report any more than I am sure President Obama is interested in trying to convince birthers that he was, in fact, born in the USA — to quote a favorite songwriter of mine).

He was only pointing out that the Google “shadow puppeteer” accusations were ridiculous, and had no more weight that the accusation that Obama isn’t an American. He is absolutely right. And he was only talking about that specific accusation – unlike Lowery, who was using the comparison to smear everyone who is a critic.

As for the graphic itself: The Cynical Musician wrote a post on it (Lowery tweeted a link), called Fun with Digital Royalties. He rightly points out that “internet radio” (that is, non-interactive Internet streams) don’t pay mechanical royalties. That is indeed incorrect on Rethink Music’s part.

However, the next thing he points out is probably just a typo. According to the graphic, for a “digital sale,” the vendor (e.g. iTunes) pays the music composition royalties (“MC”), including performance royalties and mechanicals, and the sound recording royalties (“SC”), to the record label (Columbia). Digital sales aren’t performances, so someone like iTunes wouldn’t pay performance royalties, only mechanicals. But if you simply substitute an “R” for a “C,” the diagram is correct.

The Cynical Musician rearranges the diagram so that only sound recording royalties are paid by iTunes to Columbia, and that Columbia pays the mechanicals out of those royalties (and iTunes does not). This distinction is immaterial – those “sound recording” royalties are whatever Columbia wants, and iTunes leaves it to them to pay the mechanicals. Either way, the performing artists only get paid after the mechanicals have been taken out; so saying that iTunes is providing both to Columbia is not unreasonable.

There are a few other things that could have been added to the diagram. For example, if the performer is also the composer, then they are usually subject to a “controlled composition” clause, where they only receive 75% of the mechanicals. And the diagram does not cover reduced royalties from direct deals between labels or publishers and digital services – though the report itself certainly does.

Of course, these are not the biggest mistakes in the universe. They’re certainly less unforgivable than the mistakes Lowery himself made in his Trichordist posts.

And of course, if the goal was to rebuke Rethink Music’s point that music licensing is too complicated, it failed miserably.

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2 thoughts on “The Trichordist’s War On Rethink Music

  1. I just happened to skim this post and saw this:

    “But second, it’s misleading to say that Spotify “hired” HFA. They are licensees of the catalog administered by HFA. It’s exactly like saying Pandora “hired” ASCAP. What he’s probably talking about are businesses like Music Reports, which act as intermediaries between licensees and multiple kinds of copyright licensors: labels, PRO’s, SoundExchange – and HFA itself.”

    http://www.sonicscoop.com/2011/07/19/hfa-to-administer-publishing-for-spotify-u-s-launch/#sthash.LNFWrov6.dpbs

    “NYC-based The Harry Fox Agency, Inc. (HFA) has entered into a publishing licensing, administration and management agreement with the digital music service Spotify.
    The Harry Fox Agency will spot mechanicals for Spotify.
    Under the agreement, HFA will clear mechanical publishing rights for Spotify, licensing certain rights in millions of musical works from thousands of publishers. Spotify will utilize HFA’s end-to-end publishing licensing, reporting, and royalty services to support their launch in the U.S.”

    The Harry Fox Agency (HFA) is hired by: Spotify, 7digital, Nokia, Rhapsody
    Music Reports Inc. (MRI) is hired by: Amazon, Rdio, Microsoft Xbox, MySpace, Guvera, Muve Music, Midwest Tape, ATT/Muve

    Karl you got enough of a brain that you would be better served by just doing research and bringing forth the facts in a fair-minded way than starting with the concept that you are the antagonist to Lowery and then working to shoehorn the facts in such a way that you appear to rebut him. That’s where you run into problems. If you were just focused on getting the facts right you would do the research to the end and you would avoid these kinds of mistakes.

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    • As far as I can tell, this just means that Spotify is now a direct HFA licensee. Very large licensees (online or off) have to ink deals if they want to work with HFA; the story just confirmed that the ink is dry.

      It doesn’t support anything Lowery is claiming. It doesn’t suggest that Spotify is licensing non-HFA music from HFA, or that either is sending out deficient notices. It doesn’t alter the fact that HFA licensees don’t have to send out NOI’s, or that HFA has the right to audit licensees (so Spotify isn’t a “black box” to them). And so on.

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