Author: David Newhoff

David is an author, communications professional, and copyright advocate. After more than 20 years providing creative services and consulting in corporate communications, he shifted his attention to law and policy, beginning with advocacy of copyright and the value of creative professionals to America’s economy, core principles, and culture.

Steal a Little: Piracy & the Economy

I’ve wanted a sailing yacht for years but have never been able to afford one — until now.  Thanks in part to a report on piracy and counterfeiting by the GAO and this explication by CCIA (Computer & Communications Industry Association)  lobbyist Matt Schruers, I now have a plan that will put me at the helm of the sloop Larceny by the Summer of 2016.  And the best part is the whole family gets to collaborate to make it happen. According to my rough calculations, all we have to do is steal groceries like a Dickensian gang for three full years, and we’ll save enough for a substantial down payment on the boat.  I’m thinking Beneteau 45ft, but if any seasoned mariner out there has a recommendation, let me know.

Now, you might think shoplifting food is a bit radical as an alternative financing option, but that’s where you’re wrong.  See, if the cops nab me or one of my kids while boosting a chicken from the local farm stand (we’d steal organic of course), all I have to do is point to this GAO report, which according to Mr. Schruers, advocates a truly progressive economic principle most of us have never considered.  If you want more things than you can afford, steal some and pay for the rest. Why is that okay? Because in the economy overall, it’ll be a wash. To quote Mr. Schruers:

“So what is The Issue of Which One May Not Speak?  The fact that money not spent on pirated content is, in many cases, still spent.

The U.S. Government Accountability Office pointed this out in a widely discussed report in 2010, observing that “effects of piracy within the United States are mainly redistributions within the economy for other purposes and that they should not be considered as a loss to the overall economy.”  Money does not “just vanish.”  A Swiss Government commission made a similar observation the following year.”

Go back and read that again. Because full-grown adults are saying without a hint of irony that if you don’t spend the money in your pocket, it doesn’t just disappear but will remain there until you spend it on something else! The concept is quite a mind-blower when you come to recognize its elegance. The money you have is the money you have. It’s zen-like.  I am sorry to report, though, that the money spent to reveal this discovery is in fact gone forever.

Of course, in my scheme, when I do get pinched for shoplifting my way toward boating bliss, I have to hope the prosecutor only reads Matt Schruers’s post and not the GAO report because the report itself mostly says piracy and counterfeiting are likely very harmful to the economy in several ways.  In fact, the report devotes a lot of ink detailing the inconclusiveness of many studies that look either positively or negatively at the effects of piracy and counterfeiting, but if we’re just pulling quotes at will, how about this one:

“For example, when pirated movies are sold, it damages not only the motion picture industry, but all other industries linked to those sales.”

 That’s just common sense, and it seems to me the only point worth making if one is going to assess the macroeconomic pros and cons of actually stealing from any industry.  While it’s true that not paying for selected goods and services  will undoubtedly leave you with more disposable income to spend on other things, the industry you’re not paying for will eventually shed jobs.  And if those jobs were held by people in your community, they will no longer be customers for whatever it is you’re selling.  See how that works?  It’s the same economics we learned in high school because it’s pretty damn basic. Perhaps Matt Schruers skipped class that day to hone whatever budding skills would produce this paragraph:

“Normatively bad isn’t the same as an economically bad, however.  Not all normative transgressions necessarily have macroeconomic consequences.  And yet those two items are invariably linked when studies consider infringement.  Infringement is bad, therefore we must assign an economic cost to its badness.  Hence, study after study makes the repeatedly discredited assumption that every infringement is a lost sale, usually calculated at the highest retail price for which the good was offered, and every lost sale represents a commensurate economic loss.”

Strip away words like normative that make the above sound smart and thoughtful, and it’s really just proposing a thesis — that infringement might be a form of theft that doesn’t cause macroeconomic harm — for which Schruers can offer no support.  In fact, were he to refer to the same GAO report, he would find quite a few assumptions of macroeconomic harm from piracy and counterfeiting.  Instead, Schruers segues to the repetitious, obvious, and irrelevant observation that not every individual infringement represents a lost sale.  One doesn’t need a study to draw this narrowly-focused conclusion, and the lost sale analysis is not an indicator of macroeconomic loss. Also, if we’re just going to repeat the words the average 14-year-old will use to justify torrenting music and movies, it’s a safe bet we’re not riding the wave of avant-garde economic theory.

One of my colleagues in the artists’ rights community asked if I were going to sail my new, ill-gotten yacht to Neverland, and the joke resonated more than I think he intended.    Each time I encounter some new attempt to construct a logical or economic argument for the supposed benefits of mass theft of intellectual property, it feels very much like a visit to Mr. Barrie’s  imaginary island — a place where boys refuse to grow up, where they feast on food that isn’t there, and all they really long for is someone who can tell a good story.

See Chris Castle’s “Stealing is Good for You…”

Summer Daze by the Music Stream

Photo by Ardevins
Photo by Ardevins

As we approach the dog days of summer, the blogosphere is heating up on matters pertaining to music and the stream in which it now swims.  Practically on the heels of Pink Floyd’s public warning to artists against falling for Pandora’s recent attempts to lower licensing fees, Thom Yorke of bands Radiohead and Atoms for Peace pulled his music from Spotify in an act of what he calls solidarity, saying, “Make no mistake new artists you discover on Spotify will not get paid. Meanwhile, shareholders will shortly being rolling in it.”  And indeed, Spotify CEO Daniel Ek was just named to the Sunday Times’ Rich List with his estimated fortune of $307 million. Meanwhile, artists’ rights blog The Trichordist, primarily edited by David Lowery, reminds us that the ever-present option of piracy remains a relevant factor in the bargaining positions of both sides trying to conduct legal trade.

Personally, I think there is still hope for an equitable solution to streaming services that pay fair rates to artists.  There’s nothing wrong with the technologies or the concept, only the present business models; and it doesn’t really matter if Pandora and Spotify fail. Someone will come up with the right formula, or at least one with which all parties can feel relatively satisfied. What caught my attention this week, though, was a pair of articles that ostensibly have nothing to do with one another, but side-by-side, expose an interesting dichotomy in the value placed on music streaming and social media.

The first article was this most recent post from music industry writer Bob Lefsetz in which he blasts Thom Yorke and producer Nigel Godrich for removing their music from “a platform that hasn’t gotten any traction anyway,” accusing them of “wanting to jet us back to the past” because “streaming won,” and the kids just listen on YouTube and other unlicensed platforms.  In all fairness, Lefsetz is dragging out a Straw Man that is pretty stale itself — the overused accusation that musicians are  lazily clinging to old models and delivery platforms.  This isn’t true in general, and it certainly isn’t true with regard to anything Yorke and Godrich have said about Spotify, as their criticisms are entirely about revenue sharing and not about whether or not streaming should exist. But having grounded his thesis in the matter of new vs old, Lefsetz gets to then recycle many oft-repeated proclamations about progress and the typically unspecific theme that the future is for winners who do great work and adapt to the changing landscape, whatever that quite means.  “The truth is,” writes Lefsetz, “if you’re a superstar, there’s still plenty of money in music. And superstars are the future, because no one’s got time for any [sic] less. Just like there’s one iTunes Store, one Amazon and one Google, we don’t need a plethora of me-too acts, we just need excellence.”

And that’s right where I smacked hard into article number two written by Mat Honan for Wired.  It turns out July 15th marked the one-year anniversary of the record-setting “Gagnam Style,” the first viral video ever to cross the one-billion click mark, which is cool; but in his ebullient article, Honan asserts that  thanks to “Gagnam Style,” “music is forever different.” He cites the nature, causes, and results of the K-Pop star Psy’s explosion into global, namely American, culture thanks mostly to the power of populist, rather than corporate, decision-making.  Let me say that I have nothing against Psy or his viral video, and I’m glad to see any entertainer enjoy success if he/she makes people happy; but if Honan thinks this is truly revolutionary, I’m going to guess he’s too young to remember The Hustle, The Electric Slide, The Macarena, The Achy-Breaky…shall I go on?

It’s important to distinguish between a revolutionary cultural phenomenon and the technological means by which a classic phenomenon merely scales in a new way.  For nearly as long as there has been recorded music, we’ve seen these out-of-nowhere, fad hits accompanied by some goofy dance that gets even goofier when we get Aunt Betty to give it a go after a few highballs at the family reunion.  What’s different, of course, is that YouTube enables an exponentially rapid diffusion of something like “Gangnam Style,” and it is also the same platform that enables parodies, derivatives, and, yes, even videos of someone’s Aunt Betty gyrating away after a few highballs.  It’s all good fun, and I’m the last guy to suggest anyone should get out of the pool, but “change music forever?”  Please let’s hope not.

If we read Leftsetz’s implication that the digital age inherently demands “excellence” along with Honan’s claim that “Gagnam Style” is transformative, it raises the question as to whether or not only one of these premises can be correct, and which one?  In every medium and through every distribution method, the stuff we call art — and I would argue that only art earns the superlative excellence — usually struggles for popular attention in contrast to the more transient and facile media we typically call pop culture.  Web platforms like YouTube don’t necessarily change these dynamics or redraw the lines between art and pop culture so much as they accelerate and more widely diffuse behaviors that have been part of human activity since long before the first node of the internet was built.  If anything, the high-volume consumption that internet platforms tend to foster does seem to result in more tangential and fleeting relationships with all media. If this is true, this means that the “excellence” to which Leftsetz refers can be as likely diluted by these platforms as they can be theoretically supported. In other words, an occasional “Gagnam Style” is just fine as long as we don’t destroy the market that will  produce the next Radiohead or Pink Floyd. Because they ain’t the same thing.

As with just about anything that’s carefully crafted — from a fine wine to a gourmet meal to art that truly confronts its audience — the attention demanded for appreciation is exactly the opposite kind of investment one makes by watching “Gagnam Style” on YouTube. Art’s job, in contrast to pop culture, is to be a little bit difficult, and it requires an investment by both the creator and the audience in order for it to become something truly significant. So, if we want to build a future that does enable artists to invest over a lifetime in striving for excellence, I think it’s a foolish mistake to dismiss the warnings of these music veterans as though they are nothing more than the dusty ravings of has-beens.

Copyright and the Creative Process

Ring toss

On July 4th, I announced that I’m rebooting a project that began as a short film in the summer of 2011.  goneElvis is a portrait depicting a day in the life of a female veteran of the Iraq War who is homeless and suffers from PTSD.  As stated in the new post on the film’s website, there are things I like about the short and things I don’t, but I have decided the subject still warrants a fresh approach, probably as a series, and that I have initiated collaboration with some colleagues to begin anew.  I mention the project because its production includes a very common experience in the creative process that contradicts many of the complaints one hears about copyrights stifling new creative or derivative works.  Most often, these criticisms come from people who are not engaged in any creative process, which is why they fail to understand that particularly with art, obstacles can be opportunities at least as often as they are barriers.  In fact, as an aside, I have long felt that one of the reasons many major motion pictures have become so emotionally flat is that the big-money movies are over-produced. When creators can afford to do everything exactly as planned, this removes some of the magic that comes from quick-witted solutions to various limitations.  Any student of film history knows that some of the most highly-praised cinematic moments are the result of off-the-cuff workarounds to technical, financial, or logistical challenges.

While planning the production of goneElvis, I wanted to use my friend Martin Ruby’s cover of “Tonight’s the Night,” famously recorded by The Shirelles, but I was turned down by the publishers when I requested the license for which I could not of course pay.  It seems the tendency these days is to view this kind of obstacle as unfair or muting the creative process of the next generation; but this attitude is a mistake, and I’d venture that almost any serious artist will agree.  Because I couldn’t have what I thought I wanted in the first place, I ended up with something much better simply because I was forced to go look for it.  In this case, I began by searching songs in the public domain, and when I came across the Mexican standard Cielito Lindo (you know the one with the refrain Ay, Ay, Ay, Ay), I got goosebumps imagining what Martin Ruby might do with it translated into English.  Although normally sung at a bright tempo by mariachi bands, Cielito Lindo is fundamentally a lullaby, which immediately resonates because the protagonist in the film clings to the hope of finding the daughter she lost when her husband abandoned her while she was in Iraq.  Knowing that Ruby grapples with his own challenges as a single father of a young daughter, I imagined his rendition of this song might produce something very haunting.  It did.  Instead of a bittersweet cover of a love song, we had a piece of highly-original music that is thematically perfect for the film. Suddenly, my little low-budget short didn’t have a borrowed song — it had a soundtrack.

Any artist lives in a world of obstacles — financial, logistical, legal, and hardest of all, internal.  Very often, it is the obstacles that define both the artist and the work; and I doubt there is a creator in any medium who has not benefitted from producing something he or she never anticipated at the start of a process.  In fact, I would go so far as to generalize that all creators find ways to balance the planned part of the process while leaving ample room for the unexpected. It is this aspect of creative work that is so hard to explain to those who don’t do it, but it is also true that the best results are usually a fortunate harmony of experience, expertise, and inexplicable instinct.  In other words, as a mathematical exercise, there are so many elements that must align to produce something good that it’s almost absurd to predict that any one obstacle might be either harmful or beneficial to the end result. Hence, there is no more reason to identify existing copyrights as stifling creativity any more than it would be reasonable to complain about the vicissitudes of weather.  In fact, speaking of weather, the scene with the police officer depicted in the embedded clip wasn’t written or blocked for rain, and the rain we got forced me to shoot the entire scene from inside the car with available light. Operating a heavy camera, hand-held on a sultry, rainy night in the front seat of a Cutlass is not a set of conditions I would have chosen, but the resulting scene is more dramatic than what I had planned on paper.  But that’s just filmmaking. It’s the norm.

Beyond the myriad reasons why copyrights cannot be viewed generally to stifle the creative process, they also must be understood to support the creative process with regard to the same unpredictable nature to which I refer.  Nearly any artist one listens to or reads about will describe variations on the theme of organizing one’s life to allow the work to happen, and each artist requires different conditions — from asceticism to utter chaos — to foster his or her own productivity.  With successful works, the passive income derived from copyrights, is the means by which artists are able to reinvest in a career based so precariously on the unknown.