Ranking Member Mel Watt Makes a Bold First Step in Freeing Creators From the Government’s Heavy Hand

I’ve been writing about — well, OK, a blaringly vocal advocate — for getting the government out of the music business for quite some time. Unsurprisingly, I’m quite pleased with the Free Market Royalty Act introduced today by Ranking Member Mel Watt (D-NC) of the House Judiciary Committee’s Subcommittee on Courts, Intellectual Property and the Internet.

As described, the bill does a couple of very important things — it gets rid of the compulsory license for webcasting and satellite radio, and it establishes a regime for applying the public performance right to sound recordings on over-the-air (or “terrestrial”) radio.

Quick — do you think that artists get paid when their records are broadcast over your car radio? If you said yes, you’d be wrong. Actually, you’d be right in every country of the world except China, North Korea, Vietnam…and the United States.

Except for Internet based and satellite radio in the US, which do enjoy a compulsory license mandated by the government as well as sub-market royalty rates. These rates are the object of considerable lobbying on the part of the big Internet companies, most recently Pandora. In fact, Pandora has gone running to Big Nanny every time they felt they weren’t quite making enough money, most recently with the ill-fated Internet Radio Fairness Act last year (aka “IRFA”).

The IP Subcommittee hearing on IRFA clearly demonstrated just how fed up many of the committee members are with being dragged into setting rates for the now-publicly traded Pandora. Sometimes there are particular moments when you realize that things are about to change — such a moment came during questioning at the IRFA hearing by former Chairman James Sensenbrenner.

Chairman Sensenbrenner asked the then-CEO of Pandora a question that foreshadowed todays bill — what would happen if the Congress just did nothing. That is, what would happen if the current regime expired and there were no compulsory license.

And here you have the answer in the Free Market Royalty Act.

Clear Channels Direct Deals Are Distorted by Compulsory Licenses

You have probably read about the several direct deals that Clear Channel has closed with labels that pay for public performance of music on the hundreds of Clear Channel stations. (Other broadcasters have done the same.)

There are some big problems with the Clear Channel deals, but the good thing about them is that the market is clearly demonstrating that radio recognizes that they need to pay artists and labels for radio broadcast over the air — even if the law doesn’t require it.

But the problem is that these negotiations are heavily colored by the compulsory license rates for Internet radio that are set by the government in a very cumbersome process. The Clear Channel rates are necessarily expressed with reference to the government mandated rates for compulsory licenses on Internet radio.

We will never know whether the free market would have produced a higher or lower rate, but we do know that as long as the government rate is out there for any sector, the natural inclination is to lock in a rate that is even lower than the government rate. This has a tendency to make these rates into a hole that artists will have to dig out of for a very long time.

In fact, the only thing that lasts longer than a government royalty rate is government cheese.

The Blanche Dubois Method of Royalty Auditing

Blanche Dubois, Tennessee Williams character in A Streetcar Named Desire famously said that she always relied on the kindness of strangers. This is essentially what happens for each label that makes a deal with Clear Channel as far as we can tell from the outside. Individual labels are unlikely to audit (except perhaps the Warner Music labels who have a single contract with earnings that would justify an audit).
Watt’s bill allows payment through SoundExchange, a single licensing body that can license–and audit–on behalf of all artists.

Direct Payment of Artist Royalties

One of the concerns I’ve long voiced about direct deals with broadcasters (Clear Channel, Sirius, or anyone) is that a license by a record company allows the label to collect both its own share of royalties and the artist’s share. That means artist royalties could be applied against unrecouped advances given last week or 30 years ago. That defeats the purpose of the royalty.

Under the current regime, artists get paid their share directly by SoundExchange — a nonprofit organization with an equal number of independent and artist board members and major label representatives.
Watt’s bill preserves that direct payment requirement while getting rid of the compulsory license regime. This makes the new proposal so much more attractive for artists — all artists, not just the famous ones — than the old regime.

Next Steps for Greater Market Freedom

We will see how this legislation fares and how serious Pandora et al are about rate fairness — let the market actually decide. So what’s next?

First — expect tremendous pressure from Clear Channel to close deals before the market sets the rate. Artists and labels have to make their bets as to whether it is better to take the king’s shilling now or wait until you get freed from the government mandate.

But while I’m excited that Rep. Watt took this bold first step, we can’t ignore the fact that songwriters and their performing rights organizations — ASCAP and BMI — are still subject to an antiquated regulation by the Federal Trade Commission and the Department of Justice.

Pandora has raised hundreds of millions in the public markets in both an IPO and a follow-on offering, yet still goes running to Big Nanny to set the rates for songwriters. Pandora gets the benefit of the compulsory license on the sound recordings it uses, but also gets what is essentially an equivalent compulsory license on the songs in those same recordings.

And if that’s not getting seconds on government cheese, I don’t know what is.

Paget Brewster Returning To ‘Criminal Minds’

Paget Brewster is returning to “Criminal Minds.” Brewster, who was last seen on “Criminal Minds” in May 2012, will appear as Emily Prentiss in the 200th episode. Brewster starred in six seasons of the CBS procedural.

“Our 200th episode is going to be a special show,” Erica Messer, executive producer/showrunner, said in a statement. “We can’t imagine telling this story without Paget being present.”

In the episode, viewers will get glimpses into the past and learn what happened to JJ Jareau (A.J. Cook) during her time away from the BAU. The past will also be valuable to the present day case.

Brewster teased her return on Twitter in early September.

The 200th episode will air later this season.

“Criminal Minds” airs Wednesdays, 9 p.m. ET on CBS.

U.S. On Verge Of Full-Scale Government Hoedown

WASHINGTON—With legislators unable to reach an agreement on health care and other issues before the start of the new budget year, Washington insiders confirmed Monday that the United States is rapidly approaching a full-scale government hoedown. Alr…

    



Slam Poet Dylan Garity Describes Everything He Thinks Is Wrong With ESL Education In 3 Minutes

The statistics regarding education for English as a Second Language Learners (ESL) in America are bleak and abstract: According to George Washington University Face the Facts initiative, there is only one public school teacher for every 150 ESL students, while a range of research shows that ESL students are more likely to drop out of high school than their English-speaking counterparts.

But if you want to gain an opinion of ESL education that is truly illuminating, look no further than Dylan Garity’s poem, “Rigged Game.” A slam poet for Button Poetry, Garity performed the poem last month at the 2013 National Poetry Slam competition in Boston. In it, he describes a negative cycle of standardized testing and speaks to a system that fails ESL students and constrains teachers.

Whether or not you agree with Garity’s assessment of ESL education, his poem is certainly worth a watch.

(h/t Upworthy)

To Put Its Listening Rooms On More Platforms, Soundrop Picks Up $3.4M Led By Spotify Investor Northzone

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Norwegian startup Soundrop first made its name as an app on Spotify, tapping into the streaming platform’s catalog to create real-time group listening rooms that were popular places for Spotify users to congregate for more social listening experiences. But as Spotify has become a more social platform by default, Soundrop is expanding what it does, and where it does it. Today, it is announcing a $3.4 million round of funding led by none other than Spotify’s lead investor, Northzone. The company wants to use the funding to turn up the volume on its growth to more platforms beyond Spotify and into more areas beyond simple listening rooms.

In addition to Northzone, Norwegian-government-back Investinor also participated. Northzone also led the previous $3 million round in the company last year.

The news comes at the same time that another listening-room service, Turntable.fm, is also expanding its focus; in this case from listening rooms into shared live music experiences online.

Inge Sandvik, the CEO and co-founder of Soundrop, tells me that while Spotify is currently the only music platform where Soundrop has an app, in the coming weeks this is due to grow. As for where Soundrop apps might appear in future, think about other music-streaming platforms such as Deezer that also offer app stores as one likely port of call. Another could be other kinds of streaming services that may operate more around video rather than audio; Soundrop already offers an integration with YouTube on its standalone service for its web app at play.soundrop.fm, its Facebook integrations and its standalone apps for iOS and Android.

While it makes sense that Soundrop will expand to be used in more places as a way of capturing more users, on the other this is quite a change for a company that started out at first working very closely with just one: not only was Spotify its first platform, but the two share an investor, and for a while Soundrop was actually working out of Spotify’s offices.

As Soundrop looks to expand its scope to more platforms, so too is the focus of the app changing somewhat. “We are quite tired of talking about ‘music discovery,’” Sandvik told me. “That is a crowded space and everyone wants to solve music discovery.”

So Soundrop is gravitating to where it has seen not just a lot of interest from users, but from labels on the business side, too — specifically in the creation of rooms dedicated to specific artists. Those who have created rooms on Soundrop include Imagine Dragons, Robin Thicke, Zedd, Owl City and some 130 others. The most successful of these are not trivial: Universal Music’s DJs Sebastian Ingrosso & Alesso picked up 28 million OTS users (a traffic metric standing for “opportunities to see”) after heavy marketing from both Universal and Spotify.

“Labels see us as a promotional platform,” Sandvik told me, noting that this is also where the company is generating the most revenues today. “We have seen that our artist events have been growing a lot. We are doing artist events almost every day now and several per day and we think we can scale this up quite a lot. This will again drive up their market share where music has been licensed and their revenue will grow.”

That is not to say that larger user-generated listening rooms are disappearing but they will increasingly be complemented by these artist-specific or label-specific rooms. “Music discovery and engaging a crowd is living in symbioses,” he said. “We think we are very well positioned to help out in both areas, but we think we need to focus on what tools we can give artists to amplify themselves when they are aiming to create a engaging relationship with listeners.”

At a time when Spotify is still looking for the magic formula to turn its popularity with consumers into a profitable enterprise, it’s interesting to see Soundrop making a sharp turn to services that, while popular, are also squarely aimed at revenue generation effectively as a music marketing platform. This is one of the reasons that Northzone re-invested.

“In the year since Northzone invested in Soundrop, the company has had a focus on product development and tight integration with Spotify,” noted Torleif Ahlsand, General Partner in Northzone and Chairman of Soundrop’s Board of Directors. “Now that the product has reached a new level of maturity, the company is ready to take its next steps. It feels so very right to bring Investinor in to provide additional rocket fuel. With the product well-established, Soundrop is now in pole position to drive revenue and growth in 2014.”

NBC Drops Hillary Clinton Miniseries Starring Diane Lane

NBC has canceled its planned Hillary Clinton miniseries.

The project, which was announced in July with Diane Lane attached to star, was officially killed after months of headlines and threats from the Republican National Committee.

“After reviewing and prioritizing our slate of movie/mini-series development, we’ve decided that we will no longer continue developing the Hillary Clinton miniseries,” a spokesperson for NBC said in a statement.

NBC’s move follows CNN’s scrapping of their own planned Clinton documentary. NBC first hedged on its plans to produce the Clinton miniseries in August, saying, “The Hillary Clinton movie has not been ordered to production, only a script is being written at this time. It is ‘in development,’ the first stage of any television series or movie, many of which never go to production.”

The proposed miniseries, “Hillary,” had Courtney Hunt attached as writer and director and would “recount Clinton’s life as a wife, mother, politician and cabinet member from 1998 to the present,” NBC said. The script began with Clinton living with husband Bill Clinton in the White House during his second term.

Need To Print Teeny-Weenie Things? The LumiFold Has You Covered

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I never thought I’d see the day when someone would find a reason to build a wee tiny foldable 3D printer that can make things about as big as a few matchboxes. This printer, called the LumiFold, is a 3D printer with a build envelope of 90x90x90mm and uses UV sensitive resin to print fairly high-quality objects in a few minutes.

I personally am at a loss to explain why exactly you’d want a portable, small-format 3D printer but I’m sure someone out there can set me straight. The creators are looking for a teeny-weenie $1,500 to fund the project and they’re selling the printer for $429. You can also buy parts kits for a bit less.

The creator, Marin Davide of Italy, explains his reasoning thusly:

It was first designed when a customer asked for a small, portable 3D printer that he wanted ot use for printing dentals molds. He wanted the printer to be cheap and easy to use too. We started developing the LumiFold, and after some months of designing, building prototypes, going back to design again we came up with the current design of the LumiFold. And it proved to be so good, we decided to launch a crowdfounding campaign to provide everyone interested a cheap, portable and easy to use 3d printer!

If television has taught us anything it’s that it takes different strokes to move the world. That said, this compact little resin printer seems to be filling a niche I never knew existed. Portable 3D printers could help designers build prototypes in the field and artists to create projects on the fly. It could also be a way to build replacement parts far from a machine shop. The possibilities, while beguiling, are endless.