Future of Music Newsletter #30 (January 23, 2004)

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01.23.2004

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Dear friends:

Welcome to 2004. A big THANK YOU! to the FMC supporters who made a contribution to the organization during our December donor drive. We appreciate your support. And now we’ve hit the ground running in January, with event organizing and research agendas in full swing. Here’s the latest news:

1. Space is Going Fast for the Music Law Summit West
   
   Thanks to the enthusiastic team of law students and a generous batch of panelists and speakers, the organizing for the FMC’s first event of 2004 is off to a great start. If you’re in the SF Bay area, we hope you can join us for the:
   
   Music Law Summit West
   Wednesday, February 25, 2004
   10 AM – 5 PM, with a cocktail reception to follow
   Hastings College of Law, San Francisco, CA
   
   FMC, Hastings College of Law, and Noise Pop are joining forces on this one-day seminar being held at Hastings College of Law in downtown San Francisco on February 25, 2004. It’s our goal to bring together some of the most compelling folks working in the realm of music, law and policy to talk about:
   
   • Peer to Peer File Sharing
   • Digital Download Stores: are we on the verge of the celestial jukebox?
   • Major Label Contracts: are they changing as music goes digital?
   • Music and Politics: can activist musicians have an impact on the political discourse?
   
   We’re pleased to announce two prestigious keynote speakers will be joining us:
   • California State Senator Kevin Murray
   • Lawrence Lessig, Author and Professor of Law, Stanford Law School
   
   Confirmed panelists include Fred Von Lohmann, Senior Intellectual Property Attorney, Electronic Frontier Foundation; Tim Quirk, Executive Editor of Music, Real Networks; Fat Mike of Fat Wreckords/NOFX/Punkvoter; Shoshana Samole Zisk, attorney and business representative for George Clinton Enterprises; Jordan Kurland, founder of the alternative music festival Noise Pop; Andrew Ross, Sony Music’s director of business affairs; Molly Neuman of Lookout! Records and the band Bratmobile.
   
   …and oh, so much more. Check out this webpage for the latest on panelists, schedules, directions, etc here
   
   This event is free for non-CLE attendees, but seating is limited and the room is already about 50 percent reserved. RSVP here to stake your claim.
   
   Attorneys: are you interested in CLE credit? We are working with the California Bar and Hastings on having attendance count towards accreditation. If the program is approved (and we assume it will be), we will contact interested attorneys and announce a cost for this option. We urge you to RSVP at this page to make sure you are kept in the loop about CLE developments.
   
   Media: you’re more than welcome to attend. Please fill out this form and check the appropriate box to RSVP. We also have a media advisory about the event here.
   
   
2. Seattle to Host the “Fixing Radio” Forum
   
   Fixing Radio
   Saturday, February 28, 2004
   JBL Theater at Experience Music Project, Seattle, WA
   
   Experience Music Project, KEXP Radio, the Pacific Northwest Chapter of the Recording Academy, Reclaim the Media and FMC invite you to the “Fixing Radio” Forum on Saturday, February 28 at Seattle’s Experience Music Project. The goal of this event is for musicians, media activists, regulators, and radio industry representatives to discuss proactive changes that would improve radio.
   
   This is a free event, but seating is limited and a ticket is required for entry. Tickets available at EMP day of event only. (This is EMP's standard free-event ticketing policy). We’ll post more on the website as the event develops, or check out these sites in the meantime:
   
   http://www.reclaimthemedia.org
   http://www.grammy.com/pacificnw.aspx
   http://www.emplive.com
   http://www.kexp.org
   
   
3. FMC Kicks Into Gear on Policy Summit 04
   
   Future of Music Coalition Policy Summit 2004
   Sunday, May 2 – Tuesday, May 4, 2004
   George Washington University’s Lisner Auditorium, Washington, DC
   
   Now in its fourth year, the FMC Policy Summit brings together hundreds of musicians, attorneys, policymakers, activists, technologists, big thinkers, and media representatives to discuss and debate the most current and critical issues at the intersection of music, law, technology and policy. FMC is already abuzz with panel topics, speaker ideas, keynote suggestions, and event details. Though there are not a lot of details to reveal at this point, we can tell you this:
   
   • LOWER REGISTRATION PRICES for all attendees!
   • MORE SCHOLARSHIPS available for working musicians!
   • BETTER LOCATION! Lisner Auditorium is conveniently located at 21st and H Streets NW, accessible by Metro or cab, surrounded by hotels, restaurants, shopping, coffee and internet access.
   
   Early confirmations include:
   --------------------------------------
   FCC Commissioner Michael Copps
   Jim Griffin of Cherry Lane Digital
   Jessica Litman, author and copyright professor
   Thomas Frank, author and editor of The Baffler
   John Simson from SoundExchange
   William Terry Fisher from Harvard’s Berkman Center
   Derek Sivers from CD Baby
   Brian Austin Whitney from Just Plain Folks
   And representatives from ASCAP, BMI, SESAC, AFTRA and AFM
   
   Online registration and scholarship applications will be available starting March 1, 2004.
   
   Are you interested in becoming an event sponsor? We have a wide variety of sponsorship and partnering options available. Talk to us at 202.518.4117 and we can email you a sponsor packet.
   
   
4. DC Policy Update: 2004 and Beyond
   
   As the 2004 election cycle picks up, the policy machinery will focus in on agenda-setting more than actual policy implementation. From the standpoint of musicians and music fans, there will be a number of initiatives worth watching (and participating in). While it is unclear what will actually be enacted in 2004, it is likely that (depending on the results of the elections and turnovers in congressional/administration leadership) some or all of these issues will be acted upon in 2005.
   
   1. Low Power Radio
   The FCC is expected to ask Congress for full authorization to increase the number of low power fm radio licenses currently available. Congress will actually have to pass authorizing legislation to allow the FCC to place these stations in more populated markets where spectrum space is limited. It is expected that Congress will hold hearings on this issue, and legislation is likely to be introduced within the next few months.
   
   2. Media Ownership
   The FCC's efforts to lift many longstanding media ownership rules have been stopped by the 3rd Circuit Court of Appeals, thanks in large part to our friends at Prometheus Radio Project and the Media Access Project. Congress, meanwhile, has been debating a variety of strategies to scale back the attempted deregulation. The Senate has moved aggressively on a number of fronts, including overwhelming passage of legislation that "vetoed" the entire rule change. These efforts have widespread bipartisan support in the House of Representatives, but House leaders (including Tom Delay and Commerce Committee Chairman Billy Tauzin) have worked in partnership with the Bush Administration to block hearings or a vote on these issues. The situation is extremely fluid, and it will be fascinating to see what develops over the next few weeks.
   
   3. Localism in Media
   The FCC has responded to criticism of their media ownership policies by creating a task force charged with examining localism in media. This task force is holding public hearings across the country, and is issuing a "Notice of Inquiry" -- a proceeding that asks for public comment on a variety of questions asked by the Commission. It is our hope that this NOI will tackle difficult questions like structural barriers for local and independent artists. This NOI, and the national public hearings, are both excellent opportunities to let FCC Commissioners and staff understand your concerns about local radio.
   
   4. Peer to Peer file trading
   The evolution of digital music services (both licensed and unlicensed) will be the focus of Congressional hearings and a working group chartered by Senator Norm Coleman. Senator Coleman recognizes the need for dialogue between the different perspectives on the digital music space, and hopes that this group will lead to some constructive solutions to some of the challenges we all face.
   
5. US Copyright Office Announces New Round of Webcasting Negotiations
   
   On January 6, the US Copyright Office announced a six-month window for open negotiations between interested parties on the rates that webcasters need to pay to rights holders for the use of music in webcasting. Folks who followed this issue in the past may remember that the webcasting rates were hotly debated between various parties in 2001 and 2002. So much so that, when parties couldn’t come to an agreement, the US Copyright Office had to establish a Copyright Arbitration Royalty Panel (CARP) to mediate the process. Back in 2002 the FMC put together a Fact Sheet to explain the hows and whys of the webcasting CARP. For a refresher, read it here. FMC also filed three different proposals on webcasting rates and reporting requirements, which can be found here.
   
   So what does the Copyright Office’s recent announcement mean? It’s merely a reminder for the various parties – broadcasters, record labels, and webcasters – that they’re required under the Digital Millennium Copyright Act to gather around a big table in the next six months to review the existing rates and negotiate new ones, since the current rates expire at the end of 2004. It’s to be expected that the same organizations and companies that were involved in previous negotiations – copyright holders, artist unions, commercial webcasters, small noncommercial webcasters – will take part in this new round. If they can’t get it done by themselves in this fashion, the Copyright Office will be forced to install another CARP to work it out.
   
   While FMC is not directly involved in the negotiations, we remain supportive of reasonable rates and reporting requirements that allow webcasting to flourish but also ensure that musicians are compensated for the webcast of their music. FMC will pass along information about any developments in these negotiations. The Copyright Office’s official announcement is here: http://www.copyright.gov/fedreg/2004/69fr689.html
   
   New talks over Webcasting fees begin
   By John Borland
   CNET News.com, January 7, 2004
   
   
   
6. Is Filesharing Up or Down?
   
   In early January, the Pew Center for Internet and Society released a data memo that indicated that online downloading off of peer-to-peer networks had fallen from 29% to 14% since a similar survey in May 2003.
   
   Pew was careful to qualify these results, noting that the RIAA’s recent lawsuits have not only targeted actual filesharers, they’ve also elevated the public’s awareness about copyright infringement to a point that many telephone survey respondents may not want to admit to an “illegal” action during a telephone survey. To account for this likelihood, Pew compared their phone survey results against P2P traffic data collected by comScore, which seemed to corroborate the results.
   
   Lawsuits Slow Music Downloads
   A new study shows the RIAA's slew of lawsuits seems to be effectively scaring Americans out of their music downloading ways.
   Wired, January 6, 2004
   
   Online Music Piracy Plummeted in 2003
   Drop Coincided With Recording Industry Lawsuits, Survey Finds
   By David McGuire
   Washington Post, January 4, 2004
   
   However, a number of recent articles and web postings have challenged these results. Some suggest that filesharing is as popular as ever. Others note that filesharing traffic is merely migrating away from the name-brand sites like KaZaa towards less virus-ridden networks like eDonkey or Bittorrent that may not be measured by traffic-watchers.
   
   Did Big Music Really Sink the Pirates?
   By Brian Hindo
   Businessweek, January 16, 2004
   
   Is the war on file sharing over?
   The music biz is declaring success, citing lawsuits and Apple's iTunes. But to music fans who recall the glory days of Napster, the fight goes on.
   By Farhad Manjoo
   Salon.com (premium), January 15, 2004
   
   Either way, the fight over P2P still goes on. Earlier this week the RIAA announced another round of lawsuits against individual infringers, while on the other side legitimate download sites rush in to build catalogs and attract customers. A really interesting story ran in the Washington Post a few days ago that talked about superstar artists that have resisted putting their music in any online stores – artists like Madonna, The Beatles, and Radiohead – and the resulting “holes” in the catalogs of the online stores.
   
   Music Fans Find Online Jukebox Half-Empty
   By Frank Ahrens
   Washington Post, January 18, 2004
   
   True, the legal models do not yet offer the same unlimited buffet available through P2P sites, but it was only eight months ago that Apple launched the first iTunes Music Store. While subscription models like Rhapsody have been operating for a while, Apple was the first entity to succeed at getting all five of the major labels to agree to fairly liberal DRM terms and pay-per-song downloads. Apple launched the store with an impressive 200,000 titles. Their catalog grows by the day and now includes major and independent artists. Thanks to this precedent there are now other new stores that offer other catalogs and slightly different business models.
   
   The fact that some powerful artists are holding out on their catalogs is frustrating for the consumers and stores, but there are legitimate reasons why they’re making that choice. Artists like Madonna and the Beatles have something rare, the opportunity to negotiate with major labels from a position of power. For these artists it’s not the fear of the piracy that stops them from offering their songs online, it’s a desire to get a better (more equitable) rate for digital royalties. If they can challenge the existing contracted royalty rates and set new precedents for better contracts they give other artists a new template to build on. These types of breakthrough examples are a necessary step in overall contract reform.
   
   That being said, the majority of musicians never sign a major label contract, and for this vast pool of talent the access to digital stores is an entirely different story. We’re glad that sites like Rhapsody and Itunes are willing to accept indie label material in their stores, and we’re also glad that services like IODA, Digital Rights Agency and CD Baby are available to help indies and unsigned artists sell digital tracks. In many cases, independent artists will make a much higher percentage of these digital sales; in CD Baby’s case they keep an unprecedented 91 percent of the wholesale cost! Now that’s a model worth watching.
   
   
7. Creative Commons Offers Licenses for Derivative Works
   
   How many of you out there have seen a double CC symbol at the bottom of some websites that says the content is “licensed under the Creative Commons license”. Have you ever clicked on that little box to see where it takes you? It goes to a “deed” that describes how the work can be shared. Neat enough, but behind the deed is the Creative Commons – an organization that’s “devoted to expanding the range of creative work available for others to build upon and share.”
   
   Creative Commons’ mission is to give creators of all kinds – musicians, songwriters, photographers, authors -- a way to establish a flexible set of rights over their work. Example: Say you’re a musician and you’re okay with the idea of having other musicians sample your music and include it in new songs. Under the current American copyright regime, there’s no way for musicians to let other creators know that “sampling is fine with me”. The de facto assumption is “sampling is only cool with me if you ask me, and your lawyer talks to my lawyer, and you pay me for it.”
   
   Don’t get us wrong; creators have every right to protect their works, and American copyright law gives them many tools and legal remedies to ensure this. But what about musicians that do want to share? Enter the Creative Commons licenses – a 21st century answer to the inevitable constraints of copyright law.
   
   At the website for the Creative Commons sampling license – their latest licensing option -- musicians are presented with a variety of questions and check boxes that apply to different scenarios: can people sample anything? Do they need to give you credit? Can a sample be used in commercial works? By navigating through these scenarios, the creator sets up a custom-made set of rights that applies to their work. The end result is a win-win; a more efficient and specific application of the protections that copyright affords creators, and an enriched “creative commons” that’s populated with works that are designated by the creator as available for use without any legal wrangling.
   
   We urge everyone to check out what Creative Commons is building, not only in the realm of sampling but also for other flexible uses of copyright law. It’s just plain cool.
   http://creativecommons.org/license/sampling
   
8. Newsstream
   
   Fashion iPods! Infinite loops from the Infinite Loop! Punkers at primaries! CD DRM = double royalties? How about ring tones? And so much more in the Newsstream.
   http://www.futureofmusic.org/newsstream.cfm
   
   
9. What We’re Doing
   
   Jenny Toomey had her first calm New Year's in the past three thanks to our new and improved conference dates May 2-4th. Never again will she white-knuckle it through the holidays, checking the internet to see how many tickets have sold. Instead she will trek to the Bowery Ballroom to watch Patti Smith remind her that "The People Have the Power". And they do. Jenny spent much of the past month speaking at conferences in NYC and two in England. She also debated the Economist and Ken Ferree of the FCC about the failure of the recent FCC rulemaking to serve the public interest and the dangers of media consolidation. She is now up to her eyeballs in conference plans and looking forward to spring.
   
   Michael Bracy has had difficulty focusing on his work due to the stunning return of Joe Gibbs to his beloved Redskins. Otherwise, Michael is working on a strategy to expand LPFM in 2004, helping the FCC understand what questions should be asked in their upcoming Notice of Inquiry on localism, and planning upcoming events in Seattle (on radio issues) and Washington, DC (the Policy Summit).
   
   Brian Zisk is off to MIDEM in France, and then Madrid. He's been plotting and planning how to make the next few FMC conferences as awesome as possible. In his spare time, he's been listening to unreleased new and vintage Parliament/Funkadelic tracks, and was present when George Clinton appeared with Phish at their Miami New Years Eve run.
   
   Peter DiCola presented work in progress about the employment effects of radio consolidation at the Media Diversity conference at Fordham University on December 15th and 16th. Though only a few magazines carried a review, Peter Travers in Rolling Stone called it "Fabulous! The finest presentation ever to reach the screen!" Peter has also been working with other FMCers on grant applications.
   
   Walter McDonough’s car broke down on Christmas Eve on his way to his cousin's house. Although he sustained personal injury and many of the presents were damaged, Christmas was quite joyous. 2004 will be an exciting year because, for one thing, it should end with a better Christmas Eve than 2003. Furthermore, Walter will continue to work on royalty issues for both the United States and the International music industry. He will be appearing at several conferences throughout North America in addition to his teaching duties at Northeastern University and Suffolk Law School. So, if he comes to your area this year, please feel free to share your favorite Holiday Season disasters.
   
   Kristin Thomson has been working with the folks at Hastings College of Law hammering out details for the Music Law Summit West and rounding up the troops for our own Policy Summit. She’s also been thinking a lot about alternative compensation systems for musicians and looks forward to a robust research schedule in 2004. In her spare time, she’s been playing a lot of hockey games and guitar (not simultaneously).

    

10. How are we doing?

If you have any feedback, questions, or suggestions please send an email to suggestions@futureofmusic.org, and let us know how we're doing.

Thanks for your support and see you next time.

Jenny Toomey
Michael Bracy
Brian Zisk
Walter McDonough
Kristin Thomson
Peter DiCola

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