A Copyfighter’s Musings

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John Parres:

“Speaking as a former VP of an SDMI-participating watermarking ‘solutions’ company I can testify that a watermark is the wrong tool for the job.

In terms of identification for auditing purposes, audio ‘fingerprints’ are a
far superior technology.”

Ernest Miller (responding to Derek):

“I think your assumption that there will be a relatively weak urge to
game the system is highly questionable.  We’re not really sure what the
market will look like for music if P2P is fully legitimate.  If music is
entirely freely available (except for the bandwidth – and anyone who is
paying a flat fee has some they aren’t using, many with significant
amounts) for unrestricted distribution, it is not clear to me that the
costs of gaming the system will be particularly high.  If the costs of
gaming the system aren’t high, then a relatively weak urge to game the
system will be enough to get people to game the system.

Furthermore, until you actually provide specific details of the proposed
system to be implemented, various weaknesses will not be able to be
identified and gaming strategies developed.  Talking in the abstract is
fairly meaningless in this case.  There will be an incentive to game any
system, the question is simply whether gaming it will be cost
effective.  We can’t make that call until we have details on the
proposed system.

Here are a few incentives for gaming the system:

How much money would the artist/publisher/whoever get per download?
$0.05, $0.01, $0.005?  Does it really matter? No, because then I will
pay people less than what I recoup to download my song.  In the above
case, I’ll pay people either $0.02, $0.005 or $0.0025 everytime they
download my song.  People will gladly join such systems when they have
flat fee connections.  What do I care if my computer spends all night
downloading songs and subsequently deleting them from my hard drive, if
I can get a few bucks a month taken off my “licensing fee” or however
the powers-that-be derive money from me?

Think such a system would be easy to stop?  There is a serious incentive
to figure out ways to do the above.  Heck, perhaps you could get a
“payola” law passed that would keep record industry types or artists
from paying people to download for pay (P2Payola?).  The original payola law sure worked wonders, until “independent promoters” filled the gap.

Or perhaps you would have clever algorithms that would try to figure out
when people are trying to game the system under such a P2Payola scheme. 
Design one, and someone clever will shortly figure out a way around it. 
Perhaps people will develop sharing programs for this purpose. Instead
of SETI@home, we’ll have P2Payola@home.

Of course, even definining P2Payola would be tough.  If a record company
were giving out “virtual lottery tickets” to get a backstage pass to a
concert if people downloaded the song from their website, would that be
illegal? Would that not be counted towards their share of the pie?  What
about access to a “members-only” section of the website?

You could also have a contest … $10,000 to the team or group that has
the highest number of verified downloads that get around any theoretical
anti-P2Payola system.  A prize like that would get some nice attention I
think, and really clever people working on the problem.  I could imagine
there might be some people who really, really don’t like the RIAA or
MPAA and would be happy to put up the money for such a prize.  You could outlaw such prizes, but we start to enter some real interesting
territory on what is or is not illegal.

Still think the monetary incentive isn’t enough?  There are many other
incentives that are pretty strong, given that downloading on a flat flee
connection will be relatively cheap.

Remember the Dixie Chicks?  Pretty harsh how many radio stations stopped playing their music because one of their members expressed a sentiment that many people agreed with.  Well, first thing I would do, if I were a clever programmer who agreed with that sentiment, would be to develop a small app that would download Dixie Chicks songs day and night to make up for the revenue they were losing from the radio stations.  Undoubtedly, many sympathetic types would be happy to join me in such an effort.

How difficult would it be to develop and distribute P2Politics, my
theoretical program that will allow you to get your music with all the
efficiency of the best P2P programs, and support your favorite political
positions at the same time.  Download all Lee Greenwood all the time
(when you aren’t doing something more important with your internet
connection, anyway).

Uh oh, hard to make this type of effort illegal.  You would be stomping
all over political speech if you tried.  Sure, it might be possible to
make a law that passes Constitutional muster (though unlikely), but do
you really want to stop people from voting with their downloads?

Of course, the above ideas don’t require any changes to watermarks or
anything of that nature.

As far as changing lots and lots of watermarks … lots of people would
be happy to punish Lars Ulrich of Metallica if he says something they
think is stupid again.  Again … one clever person cracks it and
develops an easy-to-use system for taking advantage of the crack …
millions of average users can use it.  This is something the average
user can really get behind.  Beats the ineffective boycotts everyone is
constantly being asked to join on The Register and Slashdot.  You could
actually do something about it.  Would enough join to make a
difference?  I think for some causes and against some
people/organizations, yes … a serious difference, that your system
will have to thwart.  Will it be a crime to do this?  If not, I think
there will be enough incentive that it will be done.  If it is a crime
… is that better than our current system?

Hmmmm … a central registry that will be checked periodically.  Very
nice.  After you’ve explained the details of your system for thwarting
all sorts of ways to game the system, perhaps you would explain the
details of the registry and tracking system and show how these could not
be exploited to violate people’s privacy.  Hopefully, your explanation
will also take into account how this system will work in conjunction
with proposed trusted computing initiatives, such as Palladium, as well
as the incentives many will have to violate users privacy.”

Fred von Lohmann (responding to Ernest):

“I have to admit, I’ve always shared some of the concerns raised by Ernie
here with respect to “watermark + census” systems.

But is it really necessary to choose any *single* approach? After all, why
not have a system like this *supplemented* by a voluntary sampling based
system (imagine 30,000 Nielsen Families for P2P, all running something that they are “paid” to run — sure, it can be gamed, but that kind of thing canbe washed out — see SETI@home, etc). Add to that data like the sort
aggregated by BigChampagne. Which other ones am I missing (must preserve user privacy, of course).

By using multiple methods, then cross-checking results for accuracy, it
seems to me you can do a reasonably good job.

From there, I just begin repeating “let not the perfect be the enemy of the
good.” Persuasive, eh? :-)”

Derek Slater (responding to Ernest):

“Very nice to hear from you – I miss seeing your articles at Lawmeme. Like those posts, your argument here is incredibly compelling and worth more thought.

(Although, I do think my argument about the gaming I was discussing – actually changing the watermark – are reasonable. For the reasons I noted, I think that’d be much easier to catch than the sort of ballot stuffing you’re talking about. Also, at the end, you mention the potential for privacy violations and, as I’ve explained recently, I’m not sure that’s a great concern.)

As for your concerns about ballot stuffing, since I have no sufficient
rejoinder now, here are some contingencies worth considering in the meantime:
1. Is it a big problem if companies offer “members-only” features in exchange for downloading? Would this cause a big distortion in the distribution of money if the total pot is fixed?
2. On average, will less detectable, small-scale ballot stuffing make a
significant difference in payouts? If the pot is fixed, is it a big deal if the
odd person gets five dollars they shouldn’t have? Spread out over an entire population of musicians, how much ballot stuffing will basically cancel out?
3. How could periodic auditing be used to look for anomolies and how could cross-checking fit in here? If a song were downloaded from certain spots significantly more than in others, we could investigate those spots to see if there’s reason to believe there was tampering.”

Ernest Miller (responding to Fred):

“Sure, any such system would have to use multiple ways of tracking things
to minimize gaming … but how many levels and systems, and would all
those levels and systems still raise the cost of gaming to the average
individual (given the ease of promulgating cracks developed by
sophisticated individuals)?  Some gaming can be washed out, but look at
the trouble SETI@home has had, and the incentives there are minor
compared to the incentives that this system will create.

Furthermore, the more complex the system, the more likely unintended
consequences will pop up, and you still won’t have necessarily prevented
gaming.

As for the Nielsen family concept, sounds good, but scares me quite a
lot.  First, if the “watermark+census” system is being regularly gamed,
so much so that you need to calibrate against the Nielsen families …
why not simply jettison the “watermark+census” system and simply rely on
the Nielsen families?  My guess is that such a system would eventually
evolve that way anyway.  Oh, sure, they’ll keep the watermark+census
system (keeps track of the non-privacy caring rubes, anyway – and is a
fig leaf for the Nielsen’s), but the real work of the monetary
distribution will be the Nielsen families.

I’m not sure I’m ready to be taxed, and have my tax monies go to big
Hollywood entertainment conglomerates, based on what some 30,000
families choose.  I don’t mind the Nielsen’s as a private corporation
providing information to ad-buyers, but I will have many concerns with
them as a tax distribution mechanism.

How much privacy will the families have to sacrifice for our benefit? Do
you really want families that don’t value privacy making these
judgements concerning your tax dollars? Indeed, who will choose these
families?  Since the blanket licensing system is the equivalent of a
tax, what right will I as a citizen have to know who and how these
families are chosen?

What about the Nielsen families gaming the system?  Are they just
assumed to be honest?  Will they be monitored?  What will they be paid
and for what?  Will we monitor only their downloads, or what they
actually listen to?  Do we want to prevent Nielsen families from voting
with their bandwidth?  If so, why? And how will we do it?

Maybe these multiple systems and cross checking will do a reasonable job
and maybe they won’t.  Hard to tell until we have a proposal in place.  
Of course, the real proof is when such a system is implemented … and
it might be too hard to back out if it doesn’t work as anticipated.

As far as not letting the perfect be the enemy of the good, I don’t
think the idea of blanket licensing is “good” in the first place.”

Fred von Lohmann (responding to Ernest):

“I’m actually not nearly as fearful of Nielsen Families as Ernie is, but I
take his points. That’s why I think a blended system makes more sense.

But this all returns me to my most basic point: considered in a vacuum, a
compulsory licensing approach is not ideal. However, at the present time,
the question is not whether the solution is “ideal”, but rather whether it
is a substantial improvement over likely alternatives (like suing 60m fans
into submission while undermining innovation, privacy and other values).

My premises:
1. unregulated P2P file-sharing is here to stay, technical and legal
countermeasures notwithstanding, for all the reasons discussed in the MSFT
Darknet paper (unless you are willing to break the Internet);
2. the basic copyright insight is valid and worth preserving — artists (and
owners) should receive such compensation as is necessary to provide
incentives for further creativity (we can argue just how high the incentive
should be, and how much public freedom bargained away);
3. transaction costs coupled with unbalanced copyright remedies (statutory
damages, relaxed injunction std) make voluntary licensing extremely
difficult, if not impossible (tho I still hold out hope for a magical
ASCAP-like solution).

Of course, everyone is free to disagree with these premises. But it seems to
me that *if* you accept them, you are left talking about compulsory
licensing perforce.

So, as I’ve said here before, I think everyone’s position on compulsory
licensing stems from her underlying premises, not from the merits or
demerits of any particular compulsories scheme. At least that’s what I think
lately. :-)”

Ernest Miller (responding to Derek):

“Thanks for the compliments, Derek.

First, we are talking about ballot stuffing one way or another.  The
first concern for a blanket licensing system will be how to distribute
the funds.  Whatever method you choose will be more or less liable to
ballot stuffing.  You propose a system of watermarks and census that
will reduce the occurence of ballot stuffing.  I think that is unlikely
to work.

Yes, the average consumer will be unable to change the watermark. 
However, most agree that sophisticated users will be able to change the
watermark.  Once the watermark is changed, what is the barrier to the
average consumer from promulgating the adulterated version?  I would
imagine that the barrier is quite small, thus a meager incentive would
suffice to entice people to promulage the adulterated version.  Thus, no
solution to ballot stuffing or gaming the system is likely from a
watermark+census system.

Privacy violations are a serious concern.  The harder you search and
attempt to determine whether something is a “legitimate download” or
“unethical, if not illicit attempt to game the system” the more
information you will necessarily have to gather.  It is a continuum. 
The more you try to stop gamemanship, the greater the threat to
privacy.  This is a very serious, and legitimate concern.  In any case,
we won’t know until you give us details on how your proposed system will
work.  It is easy to say, let the experts figure it out, but much harder
to implement.

In response to your specific questions:

1. Is it a big problem if companies offer “members-only” features in exchange
for downloading? Would this cause a big distortion in the distribution of money
if the total pot is fixed?

I don’t know.  Maybe, maybe not.  However, it is part of the continuum of what might become P2Payola.  Certainly, paying people cash to download would have a tremendously distorting effect.  So, you outlaw cash P2Payola.  Then someone comes up with something that isn’t quite cash as a form of payment.  Then you outlaw that.  Eventually, you are faced with making a distinction of what is and isn’t legal P2Payola.  Can such a distinction be made? Probably, but it won’t be easy and could just as easily lead to more difficulties than current law.

2. On average, will less detectable, small-scale ballot stuffing make a
significant difference in payouts? If the pot is fixed, is it a big deal
if theodd person gets five dollars they shouldn’t have? Spread out over
an entire population of musicians, how much ballot stuffing will
basically cancel out?

Interesting question.  No one knows the answer.  However, I don’t think
that the odd person will only be getting $5 more than they should.  Why
do you assume the ballot stuffing would be small scale?  If the internet
proves anything, it proves that scaling is really different in the
virtual world.

Perhaps some ballot stuffing will cancel out, but why would all of it? 
Seems to me, artists won’t have equal ability to ballot stuff.  Liberals
and conservatives have roughly equal support, yet conservatives dominate
talk radio.  Why is this?  No one is quite sure, but it seems odd given
their roughly equal political support.  Why shouldn’t some artists be
better ballot stuffers than others, give roughly equal popularity?

3. How could periodic auditing be used to look for anomolies and how could
cross-checking fit in here? If a song were downloaded from certain spots
significantly more than in others, we could investigate those spots to see if
there’s reason to believe there was tampering.

Tell me how you will cross-check and I will develop a way to game your cross-checking.  Why shouldn’t I and how will you stop me?  As for investigation … how many resources are you willing to spend to stop ballot stuffing? What will the cost be?  That is money taken from artists pockets, is it not?  What will be the consequence if people are gaming the system?  Will you send them to jail?  Above you say privacy is not a concern, but here you advocate investigations.

I don’t think your questions or contingencies address my concerns.”

Ernest Miller (responding to Fred):

“Fred may not be afraid of Nielsen families, but I remain unwilling to
trust them with my tax dollars on behalf of Hollywood’s entertainment
conglomerates, especially when no one gives me any details about how
they would operate in practice.

I think Fred is postulating a false dichotomy … it’s compulsory
licensing or a parade of horribles.

The logic is clear (given the presumptions), but won’t these arguments
apply to other media as well?  This is one reason I think compulsory
licensing is a path best not taken.  Once we take it in the sphere of
music, why not movies, books and videogames, or anything with a mass
market that can be distributed by the Internet?  Will be taxed for all
of it?  Will there be Nielsen families for each of these media?  What
will this mean for innovation?

Fred is essentially proposing that we replace the existing copyright
scheme with a mandatory government tax that will be shared with artists
and publishers.  Call me crazy, but I’m not really ready to jettison the
current approach for that.

Fred von Lohmann wrote:

>I’m actually not nearly as fearful of Nielsen Families as Ernie is, but I
>take his points. That’s why I think a blended system makes more sense.
>
>But this all returns me to my most basic point: considered in a vacuum, a
>compulsory licensing approach is not ideal. However, at the present time,
>the question is not whether the solution is “ideal”, but rather whether it
>is a substantial improvement over likely alternatives (like suing 60m fans
>into submission while undermining innovation, privacy and other values).
>
How many people will you have to sue for not using the right (census
monitored) P2P or bribing the Nielsen families?  Will we sue people for
gaming the system? Any system will raise the possibility of lawsuits
from people who don’t like the system.”

Derek Slater (responding to Ernest):

“> I don’t think your questions or contingencies address my concerns.

No, not conclusively or directly (I have done so with certain privacy concerns re: Mikael Pawlo, but not with yours).  At this point I am closer to where Fred’s at, in believing that combining schemes will help decrease the impact of gaming and in seeing CL schemes in terms of the current context. But, I cannot address all of your questions with the requisite specificity and precision at this time. 

You’re right that accepting Fisher’s plan in the abstract, without working out the nitty-gritty, is problematic. At the same time, I’m not sure that the nitty-gritty problems are reason enough to stop considering the plan altogether.

One other, slightly unrelated question: May I post what you have said to my blog (http://blogs.law.harvard.edu/cmusings)? I would also like to extend this to any other pho posters on the subject. As you can see here
http://www.hodder.org/LinkConvCompLic.htm, there are many copyfight bloggers who have discussed Fisher’s plan previously, and I’m sure they’d be quite interested in your insights.”

Mikael Pawlo (responding to Derek):

“Just for the record, I am still worried about the potential for extensive tracking capabilities and single entity monitoring in Professor Fisher’s system and nothing said this far or in Professor Fisher’s actual proposal (as opposed to the Cnet opinion piece) has closed the ‘Red Eye’ ( http://grep.law.harvard.edu/article.pl?sid=03/08/04/0855253 ). Reading your exchange with Mr Miller just makes me more concerned.

If your assumptions are right regarding a panelist system, then why should the tagging be introduced at all? Nielsen ratings would make the tagging unnecessary. You just have to go through the data logs of the Nielsen families. It will – as observed by Mr Miller – be major invasion of the privacy of the Nielsen families, but it will be limited (thus also far from perfect). Should all files also be tagged – for everyone – then all the privacy concerns raised by Mr Miller are valid. Add NGSCB  (it’s not called Palladium anymore!) to the mix and things look troublesome.

Your consumption of intellectual property very much defines you as an individual. This is not your groceries we’re talking about – this is what you put into your mind.”

Fred von Lohmann (responding to Ernest):

“And they call me a radical! 😉

Ernie makes a number of excellent points. There are days when he may even persuade me. I do think his solutions are the more radical. Perhaps the
better for it.

> I think Fred is postulating a false dichotomy … it’s compulsory
> licensing or a parade of horribles.

Moi?! I’m shocked, shocked, to find a parade of horribles going on in here!

> Fred is essentially proposing that we replace the existing copyright
> scheme with a mandatory government tax that will be shared with artists
> and publishers.

Now let’s not be hasty. I’m not advocating that *all* of copyright be
supplanted — this would be a compulsory license for noncommercial online
file sharing [Ed.: I think he’s talking about Netanel’s plan rather than Fisher’s. See here]. For god’s sake, that supplants less of Title 17 than the DMCA’s anti-circumvention provisions did. And whether it would be a
mandatory tax, or a voluntary one, is not at all clear. To the extent it is
voluntary, it suffers from the continuing need to police violators. But to
the extent it is mandatory, it is both over and under inclusive. Hard
choices.

> I completely disagree.  The MSFT Darknet paper sees legal
> countermeasures as being effective against wide spread public
> distribution, but ineffective against closed private distribution.

That is not how I read it. The MSFT engineers conclude that small worlds
networking is essentially an equivalent replacement for unitary public
networks. See, e.g., AOL IM, which I understand is the best file sharing
going.

> Perhaps.  But if a compulsory licensing scheme is to be taken seriously,
> it must be clear how it will work.  Could be that compulsory licensing
> will make things worse.

I completely agree that critical evaluation is necessary. But I stand by my
view that much of the argument must begin by examining assumptions
(especially whether you think unregulated P2P can be meaningfully
curtailed).”

(Second Edition starts here)

Brian Zisk:

“This is one of the reasons I advocate a per song payment, split
amongst the songwriters, the performers, their representatives, and
the PROs.

If you only distribute a percentage of what’s actually collected to
each rights holder, it’s impossible to game the system, as you’d
never receive more than is paid into the system for each transaction.”

Kevin Marks (responding to Brian):

“But that is the exact problem with the Fisher/Sobell/Netanel/Griffin et
al schemes. There are no transactions. There are nebulous taxes,
nebulous payouts and a nebulous monitoring scheme that will make
everything all right. Allegedly.

Per-song payment (perpetual license, NOT per play) is far more sensible
and tractable as the transaction size can be big enough to support the
processing overhead.”

Fred von Lohmann (responding to Derek re: Netanel v. Fisher plan):

“I stand corrected. Once again, I can’t believe they call *me* the radical. And Terry looks so much the part of reasonable law professor. ;-)”

Dan Krimm (responding to Kevin and Brian):

“But how can you guarantee that there will be “transactions” per se in the face of P2P networks?

I think you can’t.  The atomized transactional paradigm is itself no longer operative unless you impose unacceptably strict user-control-restricting DRM on the process.  That’s the whole problem with intellectual work on the network.  Transactions require containers, and containers are obsolete on the net for such content.

The two options that make sense in the absence of transactions are service models, either distributed or centralized.  If you don’t like the “nebulous” character of distributed models (I admit that I still would like to see the details of any such system before I sign off on my endorsement), then the centralized model is ready to work just fine, and the measurement of use need not be nebulous at all, though it can still be sufficiently anonymous to protect privacy.

Both of these options require blanket licensing schemes to be properly enabled.  But also, in both cases the transaction is being unbundled while the service is being bundled.  Customer no longer pay for specific content per se, but for general access and integration services (i.e., you don’t “pay for the music” so much as you “pay for control over the music”).  But royalties are paid according to use which is measured either directly or statistically.

I think it’s high time to unbundle the transactions and to bundle the services.  In this domain of intellectual works, atomistic transactions are increasingly obsolete on the network.”

Kevin Marks (responding to Krimm):

“> But how can you guarantee that there will be “transactions” per se in
> the face of P2P networks?

Transactions continue. CD sales have not disappeared. iTunes store is
making plenty of transactions

> I think you can’t.  The atomized transactional paradigm is itself no
> longer operative unless you impose unacceptably strict
> user-control-restricting DRM on the process.  That’s the whole problem
> with intellectual work on the network.  Transactions require
> containers, and containers are obsolete on the net for such content.

No, assuming that transactions require containers and DRM is obsolete.
Here’s  Kottke’s parable of the donuts:

http://www.kottke.org/03/07/030717business_les.html”

Dan Krimm (responding to Kevin):

“>Transactions continue. CD sales have not disappeared. iTunes store is making plenty of transactions

** Straw horses.  This is a transitional time, not a benchmark for the future.  CD sales are irrelevant, because we’re only talking about online issues (copyright and transactions can stay the same offline where physical product is concerned).  It remains to be seen how iTunes will endure — my guess is that if it survives a while it will only be by radically changing its business format as the broadband wireless penetration curve proceeds over time, and iPods turn into WiPods.

>No, assuming that transactions require containers and DRM is obsolete. Here’s  Kottke’s parable of the donuts:

** Donuts are no more intellectual works than cars or clothing.

This metaphor doesn’t map to the online domain.  The point is that online transactions for recorded music are not guaranteed to survive the technological transition.  My guess is that they are most likely not to.

Transactions will probably endure online only for physical goods and services, not intellectual works.  Trying to make intellectual works into a counterpart of physical goods is embodied in the ill-advised DRM route.  My advice is to give it up.  No good can come of this.”

John Schuch:

“I, too, think that answering Derek’s specific questions about the magnitude and effect of gaming a compulsory license scheme is tricky, but I do know one thing:  Under such a scheme there would be much more incentive for gaming to occur.  Why?  Because the size of the pie would be transformed from one with an unlimited upside to one circumscribed by the amount of tax revenues collected.  With such uncertainty about the prospective bottom line inserted into the music business, gaming becomes an obvious mechanism to get an edge.”

“Ernest Miller wrote:

“What will this mean for innovation?”

It’s entirely possible that it will mean that there will be less of it, since the rewards to innovators in the music space, artists as well as cutting-edge entrepreneurs, will be limited to percentages of a finite pie of revenues, rather than the current potential for extraordinary economicrents unbounded by such a limitation.

Of course, the argument on the other side is that the pie, however finite it
may be, will grow far beyond the current one.  That, however, is in the
theoretical realm, and probably incapable of proof before implementation.

For that reason, among others that Ernest has eloquently enumerated, I’m
unwilling to sign on as well, until someone draws a more detailed roadmap
than the ones I’ve seen so far.”

“Fred:

I don’t think weighing in on the efficacy of a compulsory license solution
resolves to a zero-sum game.

I agree with the premises you listed, but contained therein is the almost
throwaway parenthetical:

“we can argue just how high the incentive should be, and how much public freedom bargained away….”

These are important issues and, in my view, need to be front and center in
the compulsory debate, and not merely incidental to it.  The answers may
determine whether or not such a solution is workable at all.

So, I don’t believe it’s an “either/or” situation at all.”

John Parres (responding to Schuch, but also adding to Fred’s theme):

“Should we then also discard the current regime because it’s possible to game radio, retail and artist royalties?  ALL systems are subject to gaming. The key is to minimize it’s impact so everyone has an equal and fair shot at their slice of the pie.”

John Schuch (responding to Parres)

” I’m not saying that at all, John.  Just that there’s more incentive for
players to game the system when price is regulated.”

John Parres (responding to Schuch)

“More* incentive?  I don’t see any proof of that.

Seems to me the ability to game is the motivating factor.  If we sample
thoroughly and sufficiently to make gaming the survey difficult and
inconsequential then we have done a good thing for everyone but the gamers.”

Ernest Miller, after questioning whether what Parres said can actually occur, responds:

“First, gaming in the current context is a battle between businesses. 
Incentives are relatively balanced.  I want to sell dear, you want to
buy cheap.  We try to game each other and eventually come to an
agreement … that is how the market works.  In the proposed system,
everyone wants to game the government tax distribution, and the
government doesn’t have real good incentives to make sure the
distribution is fair.

Second, in the current context, gaming the system costs serious money. 
People can’t really game the system for free.  In the online context,
gaming would likely be quite cheap, free even.

Thus, although I agree the current system is flawed, the proposed system
is (in my belief) even worse.”

Joshua Wattles (responding to Ernest):

“I must be uncharacteristically missing something.  A compensable download
would be a compensable download.  The download is taking place and the
survey (or if you think gaming is a factor or consequence, then you must
think there would be a census) will pick it up like all the other downloads
and pay the owner.  The only arguable “false” download would be to the ip of the owner.  In the record business, many a chieftain sent his troops to the field to buy singles and albums at retail which had been sold by the same chieftain at wholesale in order to enhance future sales. If people build
auto downloaders to fake-out the survey, the same techies who built the
survey tool can build snifters or add to the survey an audit component
tracing back to users.  There are much larger issues than cheaters and
fakers.  There will always be part of the music world as they are in almost
every other business, industry, enterprise or institution.”

Bennett Lincoff (responding to Joshua):

“Years ago, ASCAP faced a ballot-box stuffing problem with respect to how it distributed royalties for TV performances.  This is a non-Internet example that may (or may not) be useful int he P2P context, but here goes:

ASCAP pays royalties essentially on a per-performance basis; the more
performance of your works that are disclosed in the ASCAP survey, the more royalty monies you receive.  However, in doing this, ASCAP treats some performances as having a greater value than others.

For example, royalties for “feature performances” (where the music is the
focus of audience attention, as when a band is shown playing the music or a singer is shown signing it) are paid at a higher rate than are royalties for
performances of background music or themes songs.  (And please, before I receive the usual amount of off-list hate mail whenever I reference anything about ASCAP: I’m not offering any view as to whether this system is good, bad or indifferent.)

Each time a feature performance occurred in a television show the entitled
parties (composer and publisher) each received a payment for that performance calculated at the highest possible value under the ASCAP system; and this whether the entire work was played or only a few bars of it.  A show with one feature performance received one such payment; a show with 100 feature performances received 100 such payments.  (Other than currently-employed ASCAP lurkers, Ron Gertz probably knows more about this area than anyone else on the list.)

The gaming, the ballot box stuffing, arose in connection with payments for
feature performances on the Tonight Show during Carson’s reign and when Mitch Miller led the band.  Miller gamed the ASCAP system by causing his band to play his own compositions on camera (thus making a feature performance under the ASCAP rules) both before and after every single commercial on the Tonight Show. 
Lots of commercials; lots of features performances of Miller’s music; lots of royalties for Miller and his publisher (perhaps even a closely held publisher
at that).

This was not the way the royalty distribution system was intended to work.

To overcome this gaming, ASCAP changed its distribution rules to limit the absolute number of feature performances which will be recognized in any given hour of a television show’s broadcast.  Thus, after the maximum recognized number of feature performances of his music, Miller lost any direct financial incentive to game the system further.  Of course, playing his music on the Tonight Show gave further wide exposure to his own work, but that’s a different matter than manipulated the distribution system.”

Filed by Derek Slater at 6:26 pm under
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