PG’s Thoughts (such as they are)

The Golden Age of Youtube Is Over

13 April 2019

From The Verge:

The platform was built on the backs of independent creators, but now YouTube is abandoning them for more traditional content.

. . . .

Aanny Philippou is mad.

He’s practically standing on top of his chair as his twin brother and fellow YouTube creator Michael stares on in amusement. Logan Paul, perhaps YouTube’s most notorious character, laughs on the other side of the desk that they’re all sitting around for an episode of his popular podcast Impaulsive. Anyone who’s watched the Philippous’ channel, RackaRacka, won’t be surprised by Danny’s antics. This is how he gets when he’s excited or angry. This time, he’s both.

“It’s not fair what they’re doing to us,” Danny yells. “It’s just not fair.”

Danny, like many other creators, is proclaiming the death of YouTube — or, at least, the YouTube that they grew up with. That YouTube seemed to welcome the wonderfully weird, innovative, and earnest, instead of turning them away in favor of late-night show clips and music videos.

The Philippou twins hover between stunt doubles and actors, with a penchant for the macabre. But YouTube, the platform where they built their audience base, doesn’t seem to want them anymore.

. . . .

The Philippous’ story is part of a long-brewing conflict between how creators view YouTube and how YouTube positions itself to advertisers and press. YouTube relies on creators to differentiate itself from streaming services like Netflix and Hulu, it tells creators it wants to promote their original content, and it hosts conferences dedicated to bettering the creator community. Those same creators often feel abandoned and confused about why their videos are buried in search results, don’t appear on the trending page, or are being quietly demonetized.

At the same time, YouTube’s pitch decks to advertisers increasingly seem to feature videos from household celebrity names, not creative amateurs. And the creators who have found the most success playing into the platform’s algorithms have all demonstrated profound errors in judgment, turning themselves into cultural villains instead of YouTube’s most cherished assets.

. . . .

YouTube was founded on the promise of creating a user-generated video platform, but it was something else that helped the site explode in popularity: piracy.

When Google bought YouTube in 2006 for $1.6 billion, the platform had to clean up its massive piracy problems. It was far too easy to watch anything and everything on YouTube, and movie studios, television conglomerates, and record labels were seething. Under Google, YouTube had to change. So YouTube’s executives focused on lifting up the very content its founders designed the platform with in mind: original videos.

The focus on creator culture defined YouTube culture from its earliest days. The platform was a stage for creators who didn’t quite fit into Hollywood’s restrictions.

. . . .

Between 2008 and 2011, the volume of videos uploaded to YouTube jumped from 10 hours every minute to 72 hours a minute. By 2011, YouTube had generated more than 1 trillion views; people were watching over 3 billion hours of video every month, and creators were earning real money via Google AdSense — a lot of money. Jenna Marbles was making more than six figures by late 2011. (In 2018, a select group of creators working within YouTube’s top-tier advertising platform would make more than $1 million a month.)

By 2012, creators like Kjellberg were leaving school or their jobs to focus on YouTube full-time. He told a Swedish news outlet that he was getting more than 2 million views a month, boasting just over 300,000 subscribers.

. . . .

Between 2011 and 2015, YouTube was a haven for comedians, filmmakers, writers, and performers who were able to make the work they wanted and earn money in the process. It gave birth to an entirely new culture that crossed over into the mainstream: Issa Rae’s Awkward Black Girl series would eventually lead to HBO’s Insecure. Creators like the Rooster Teeth team and Tyler Oakley went on tour to meet fans after generating massive followings online. YouTube had reached mainstream success, but in many ways, it still felt wide open. Anyone could still upload almost anything they wanted without much input from YouTube itself.

. . . .

Behind the scenes, things were changing. YouTube had begun tinkering with its algorithm to increase engagement and experimenting with ways to bring flashier, produced content to the platform to keep up with growing threats like Netflix.

In October 2012, YouTube announced that its algorithm had shifted to prefer videos with longer watch times over higher view counts. “This should benefit your channel if your videos drive more viewing time across YouTube,” the company wrote in a blog post to creators.

This meant viral videos like “David After Dentist” and “Charlie Bit My Finger,” which defined YouTube in its earliest days, weren’t going to be recommended as much as longer videos that kept people glued to the site. In response, the YouTube community began creating videos that were over 10 minutes in length as a way to try to appease the system.

. . . .

In 2011, YouTube invested $100 million into more than 50 “premium” channels from celebrities and news organizations, betting that adding Hollywood talent and authoritative news sources to the platform would drive up advertising revenue and expand YouTube to an even wider audience. It failed less than two years later, with what appeared to be a clear lesson: talent native to YouTube was far more popular than any big names from the outside.

. . . .

Then, suddenly, creators started encountering problems on the platform. In 2016, personalities like Philip DeFranco, comedians like Jesse Ridgway, and dozens of other popular creators started noticing that their videos were being demonetized, a term popularized by the communityto indicate when something had triggered YouTube’s system to remove advertisements from a video, depriving them of revenue. No one was quite sure why, and it prompted complaints about bigger algorithm changes that appeared to be happening.

Kjellberg posted a video detailing how changes had dropped his viewership numbers. He’d been getting 30 percent of his traffic from YouTube’s suggested feed, but after the apparent algorithm update, the number fell to less than 1 percent. Kjellberg jokingly threatened to delete his channel as a result, which was enough to get YouTube to issue a statementdenying that anything had changed. (The denial sidestepped questions of the algorithm specifically, and spoke instead to subscriber counts.)

These perceived, secretive changes instilled creators with a distrust of the platform. It also led to questions about their own self-worth and whether the energy they were spending on creating and editing videos — sometimes north of 80 hours a week — was worth it.

. . . .

YouTube was exerting more control over what users saw and what videos would make money. Once again, the community would adapt. But how it adapted was far more problematic than anyone would have guessed.

. . . .

By the beginning of 2017, YouTube was already battling some of its biggest problems in more than a decade. YouTube’s founders didn’t prepare for the onslaught of disturbing and dangerous content that comes from people being able to anonymously share videos without consequence. Add in a moderation team that couldn’t keep up with the 450 hours of video that were being uploaded every minute, and it was a house of cards waiting to fall.

YouTube had come under fire in Europe and the United States for letting extremists publish terrorism recruitment videos to its platform and for letting ads run on those videos. In response, YouTube outlined the steps it was taking to remove extremist content, and it told advertisers it would be careful about where their ads were placed. It highlighted many creators as a safe option.

But neither YouTube nor Google was prepared for what Felix “PewDiePie” Kjellberg — one of YouTube’s wealthiest independently made creators — would do.

. . . .

In mid-February 2017, The Wall Street Journal discovered an older video from Kjellberg that included him reacting to a sign held up by two kids that said, “Death to all Jews.” The anti-Semitic comment was included in one of his “react” videos about Fiverr, after having pivoted to more of a variety channel instead of focusing just on games.

His video, along with reports of ads appearing on terrorist content, led to advertisers abandoning YouTube. Kjellberg was dropped from Disney’s Maker Studios, he lost his YouTube Red series, Scare PewDiePie, and he was removed from his spot in Google Preferred, the top-tier ad platform for YouTube’s most prominent creators.

“A lot of people loved the video and a lot of people didn’t, and it’s almost like two generations of people arguing if this is okay or not,” Kjellberg said in an 11-minute video about the situation. “I’m sorry for the words that I used, as I know they offended people, and I admit the joke itself went too far.”

The attention Kjellberg brought to YouTube kickstarted the first “adpocalypse,” a term popularized within the creator community that refers to YouTube aggressively demonetizing videos that might be problematic, in an effort to prevent companies from halting their ad spending.

Aggressively demonetizing videos would become YouTube’s go-to move.

. . . .

The January 2017 closure of Vine, a platform for looping six-second videos, left a number of creators and influencers without a platform, and many of those stars moved over to YouTube. David Dobrik, Liza Koshy, Lele Pons, Danny Gonzalez, and, of course, Jake and Logan Paul became instant successes on YouTube — even though many of them had started YouTube channels years before their success on Vine.

YouTube’s biggest front-facing stars began following in the footsteps of over-the-top, “bro” prank culture. (Think: Jackass but more extreme and hosted by attractive 20-somethings.) Logan Paul pretended to be shot and killed in front of young fans; Jake Paul rode dirt bikes into pools; David Dobrik’s friends jumped out of moving cars. The antics were dangerous, but they caught people’s attention.

. . . .

Jake and Logan Paul became the biggest stars of this new wave, performing dangerous stunts, putting shocking footage in their vlogs, and selling merchandise to their young audiences. Although they teetered on the edge of what was acceptable and what wasn’t, they never really crossed the line into creating totally reprehensible content.

. . . .

It wasn’t a sustainable form of entertainment, and it seemed like everyone understood that except for YouTube. The Paul brothers were on their way to burning out; all it would take was one grand mistake. Even critics of the Pauls, like Kjellberg, empathized with their position. Kjellberg, who faced controversy after controversy, spoke about feeling as though right or wrong ceased to exist when trying to keep up with the YouTube machine.

“The problem with being a YouTuber or an online entertainer is that you constantly have to outdo yourself,” Kjellberg said in a 2018 video. “I think a lot of people get swept up in that … that they have to keep outdoing themselves, and I think it’s a good reflection of what happened with Logan Paul. If you make videos every single day, it’s really tough to keep people interested and keep them coming back.”

Still, Logan Paul was small potatoes compared to YouTube’s bigger problems, including disturbing children’s content that had been discovered by The New York Times and more terrorism content surfacing on the site. Who cared about what two brothers from Ohio were doing? The breaking point would be when Logan Paul visited Japan.

. . . .

Logan Paul’s “suicide forest” video irrevocably changed YouTube.

In it, Paul and his friends tour Japan’s Aokigahara forest, where they encountered a man’s body. Based on the video, it appears that he had recently died by suicide. Instead of turning the camera off, Paul walks up to the body. He doesn’t stop there. He zooms in on the man’s hands and pockets. In post-production, Paul blurred the man’s face, but it’s hard to see the video as anything but an egregious gesture of disrespect.

Within hours of posting the video, Paul’s name began trending. Actors like Aaron Paul (no relation), influencers like Chrissy Teigen, and prominent YouTubers called out Paul for his atrocious behavior.

YouTube reacted with a familiar strategy: it imposed heavy restrictions on its Partner Program (which recognizes creators who can earn ad revenue on their videos), sharply limiting the number of videos that were monetized with ads. In a January 2018 blog post announcing the changes, Robert Kyncl, YouTube’s head of business, said the move would “allow us to significantly improve our ability to identify creators who contribute positively to the community,” adding that “these higher standards will also help us prevent potentially inappropriate videos from monetizing which can hurt revenue for everyone.”

. . . .

The only people who didn’t receive blame were YouTube executives themselves — something that commentators like Philip DeFranco took issue with after the controversy first occurred. “We’re talking about the biggest creator on YouTube posting a video that had over 6 million views, was trending on YouTube, that no doubt had to be flagged by tons of people,” DeFranco said.

“The only reason it was taken down is Logan or his team took it down, and YouTube didn’t do a damn thing. Part of the Logan Paul problem is that YouTube is either complicit or ignorant.”

. . . .

[B]y the middle of 2018, lifestyle vloggers like Carrie Crista, who has just under 40,000 subscribers, were proclaiming how the community felt: forgotten. “YouTube seems to have forgotten who made the platform what it is,” Crista told PR Week. In its attempt to compete with Netflix, Hulu, and Amazon, she said, YouTube is “pushing content creators away instead of inviting them to a social platform that encourages them to be creative in a way that other platforms can’t.”

Even people outside of YouTube saw what was happening. “YouTube is inevitably heading towards being like television, but they never told their creators this,” Jamie Cohen, a professor of new media at Molloy College, toldUSA Today in 2018.

By promoting videos that meet certain criteria, YouTube tips the scales in favor of organizations or creators — big ones, mostly — that can meet those standards. “Editing, creating thumbnails, it takes time,” Juliana Sabo, a creator with fewer than 1,000 subscribers, said in 2018 after the YouTube Partner Program changes. “You’re just prioritizing a very specific type of person — the type of person that has the time and money to churn out that content.”

Individual YouTube creators couldn’t keep up with the pace of YouTube’s algorithm set. But traditional, mainstream outlets could: late-night shows began to dominate YouTube, along with music videos from major labels. The platform now looked the way it had when it started, but with the stamp of Hollywood approval.

. . . .

The RackaRacka brothers are tired.

“We loved it before when it was like, ‘Oh, you guys are doing something unique and different. Let’s help you guys so you can get views and get eyes on it,’” Danny says. “I’d love to go back to that. We have so many big, awesome ideas that we’d love to do, but there’s no point in doing it on YouTube.”

Link to the rest at The Verge

The OP is a very long article. PG has excerpted more than he might have from an article with a different topic, however.

While reading the article, PG was struck by parallels between how dependent indy videographers were on YouTube and how dependent indy authors are on Amazon.

A year ago, PG doesn’t believe he would have had the same response. The amateurism and arrogance demonstrated by YouTube management in the OP contrasted greatly with the maturity and steady hand at the top levels of Amazon. Amazon has not made many dumb mistakes. Amazon has also treated indy authors with respect and generosity beyond that shown by any other publisher/distributor/bookstore in the US (and probably elsewhere).

This is not to say Amazon is a perfect company or that it hasn’t made some mistakes, but Amazon has demonstrated good business judgment, done a pretty good job of fixing its errors and hasn’t changed the way it operates in a manner that has harmed indie authors in a serious way.

Obviously, Jeff Bezos, his attitudes, judgment and approach to dealing with others has imprinted itself up and down the corporate hierarchy at Amazon. That sure hand on the corporate helm has caused PG to trust Amazon more than he does any other large tech company.

Additionally, Amazon has been leagues beyond any other organization in the book publishing and bookselling business in attracting smart adults as managers, making intelligent business decisions, treating partners well and managing the business as if it wanted long-term success as a publisher and bookseller (see, as only one example of business as usual in the publishing world, Barnes & Noble).

However.

PG admits his faith in Jeff Bezos’ solid judgment took a big hit with the disclosure of Bezos’ marital misconduct and divorce.

This struck him as an immature example of the runaway hubris that has brought down quite a few large companies, particularly in the tech world.

PG is old-fashioned in his belief that the behavior of a virtuous individual will manifest itself in all parts of that individual’s life. He understands the common explanation for such behavior in terms of a person being able to segment his life into business and personal spheres and continue in public excellence while making serious mistakes in private behavior.

PG also understands that marriages can fail for a wide variety of reasons and assigning blame for such failure (if there is blame to be assigned) is impossible for someone who is not privy to the personal lives of each party. That said, PG suggests at least a separation, if not a divorce, would be a more standup approach by a mature adult exercising good judgment to a marriage that has declined to the point of a breakup.

A secret affair that is leaked to the press is not, in PG’s admittedly traditional eyes, up to the standards he has come to expect from Bezos. The general reaction PG has seen in the press leads PG to believe he is not alone in his opinion.

Apple Felt like a Totally Different Company Today

26 March 2019

From Fast Company:

While I sat inside the Steve Jobs Theater watching Big Bird talk to a hand puppet on the stage, I realized Apple was not the same company I knew not long ago.

No new devices were announced. There were no slides filled with impressive specs or performance metrics. No oohs and ahhs. No “one more thing.”

Yeah, yeah, I know: Apple, under CEO Tim Cook, is becoming a services company to account for flagging iPhone sales growth. What we saw today, at Apple’s “It’s show time” event in Cupertino–maybe for the first time–is the public face of that new company.

Part of the reason the presentation felt so different is because it was as much about other companies as it was about Apple. It was about Apple putting an Apple wrapper on a bunch of content and services made by third parties.

. . . .

All these announcements came in the first hour of the presentation. With that much time left I wondered if Apple had some tricks up its sleeve after all. But no: It had simply reserved an entire hour to talk about its original video content, which it has branded “TV+,” and which won’t be available until next fall.

What followed was a string of Hollywood people talking about the shows and movies they’re making for Apple. The uneasy mix of Hollywood and Silicon Valley cultures was on full display. Reese Witherspoon, Jennifer Aniston, and Steve Carrell were there to boost a show they’re making about TV news personalities, but they came off like they were trapped under glass.

Steven Spielberg came out to a warm welcome and talked about his reboot of the Amazing Stories series for television. A dramatic video came on about how we desperately need more conversation among people with different viewpoints. Then the lights went down, and when they came up Oprah Winfrey was there.

. . . .

The question is the company’s identity. At Apple events we’re used to seeing people like Kevin Lynch (Apple Watch) and Craig Federighi (iOS) who you know live and breathe core “Designed in California” products.

Today the company made a big deal of announcing a bunch of third-party content and services, with only passing references to the hardware that made it famous. Should Apple really identify itself with products that its own creative hand never really gets close to?

Link to the rest at Fast Company

TPV isn’t a tech blog, but PG has worked with a variety of tech companies in the past and, although he’s a Windows guy, has always admired Apple’s sense of mission and used iPhones almost forever.

The successor of a talented and creative CEO has a tough job in Silicon Valley. After a quick mental review, PG thinks far more successors at significant tech companies have failed than have succeeded.

Steve Jobs took Apple through some perilous times, but he always pushed the envelope and announced interesting new products. Under Jobs, Apple certainly had some product failures, but it never seemed like a company that was resorting to lame strategies. When things got tough, Apple thought big.

As the OP reflected, after stumbling with the pricing/features of its latest iPhones, yesterday’s announcement seemed to represent, “We’ve got to do something! Let’s copy what other companies are doing, but use Apple branding. Apple has a great brand that we need to exploit.”

PG suggests that brand equity is a precious commodity that needs to be preserved and cultivated with impressive new accomplishments, fostering the assurance that customers can continue to receive great benefits from the company and its products. It needs to feel cool by the standards of its industry.

In the tech world, where real technology talent is always in short supply, newly-graduated engineers from top universities are often attracted to employers who promise the opportunity to work on the cutting edge.

For all of Tesla’s financial ups and downs and Elon Musk, its frenetic CEO, engineers working there feel like they’re inventing the future. Amazon has felt like a serious innovator for a long time and can attract tech and marketing talent based upon that reputation and the opportunity to work on something new and different. (PG hopes Bezos’ marital problems aren’t Amazon’s version of Jobs’ pancreatic cancer.)

If Apple’s reputation becomes, “The company is not what it used to be and shows no signs of turning around,” adverse consequences will appear from many different directions.

 

How Printers Can Capitalize on Book Publishing Trends in 2019

20 March 2019

From Printing Impressions:

As technology continues to disrupt and transform the book market, publishers are responding by changing business models that affect how media is produced, distributed and consumed in the book publishing industry. As dramatic technology shifts continue, book publishers, authors and printers need to adapt to benefit from new opportunities.

With the start of another year, book publishers and manufacturers are evaluating what the future might hold.

. . . .

For those in the printing industry, Walter highlighted that there was modest growth in print book sales in 2018 with volume climbing 1.3% — in a year where there were no major blockbuster bestsellers like “Fifty Shades of Grey” or “Harry Potter.” Walter expects the market to remain relatively flat but stable. The key is the migration to more and more digitally printed books.

. . . .

The Book Industry Study Group (BISG) is a leading book industry trade association that offers standardized industry best practices, research and information. O’Leary said one of the biggest issues facing the book market is the management of the supply chain and shared results of BISG’s year-end “State of the Supply Chain” survey. O’Leary highlighted that the three top priorities respondents were focused on in 2019 when it came to supply chain management were:

  1. Making data-driven decisions
  2. Timely, high-quality metadata to improve discovery and sales (At its most basic level, metadata is how people find your book. This includes the ISBN, keywords, the author name, pub date, BISAC code, reviews, author bios and more. )
  3. Keeping up with new technologies to improve workflow and supply chain management

. . . .

IBPA CEO Angela Bole explained that three publishing models continue to exist: traditional publishing; self-publishing, where authors can be assisted or unassisted by vanity press organizations; and hybrid or partner publishing.

Bole says that in 2019, the industry will experience the rise in hybrid publishing — a gray zone between traditional publishing and self-publishing that is still being defined. Bole described hybrid publishing as publishing companies behaving like traditional publishing companies in all respects, except that they publish books using an author-subsidized business model, as opposed to financing all costs themselves, and in exchange return, a higher-than-standard share of sales proceeds to the author. In other words, a hybrid publisher makes income from a combination of publishing services and book sales. Hybrid publishers provide a range of services for the author such as:

  • Vet submissions.
  • Publish under its own imprint(s) and ISBN(s).
  • Publish to industry standards.
  • Ensure editorial, design and production quality.
  • Pursue and manage a range of publishing rights.
  • Provide distribution services.
  • Demonstrate respectable sales.
  • Pay authors

Link to the rest at Printing Impressions

PG won’t spend time venting, but he will suggest that traditional publishing is already author-subsidized in that authors receive only a small percentage of the money generated by their books while publishers receive a significantly larger share.

EU and Article 13: the Dystopia That Never Was and Never Will Be

15 March 2019

From The Trichordist:

The “Declaration of the Independence of Cyberspace“ published in 1996 by John Perry Barlow begins with the words “Governments of the Industrial World I come from Cyberspace, the new home of Mind. On behalf of the future, I ask you of the past to leave us alone.” One reading of this text entirely rejects the possibility that processes of making and enforcing collectively binding decisions – political processes – apply on the Internet. Another possible reading sees the Internet as a public space governed by rules that must be established through democratic process while also holding that certain sub-spaces belong to the private rather than the public sphere. The distinction between public and private affairs, res publicae und res privata, is essential for the functioning of social spaces. The concept of the “res publicae” as “space concerning us all”  led – and not only etymologically – to the idea of the republic as a form of statehood and, later, as a legitimate space for democratic policymaking.

On the Internet, this essential separation of private and public space has been utterly undermined, and the dividing lines between public and private spaces are becoming ever more blurred. We now have public spaces lacking in enforcement mechanisms and transparency and private spaces inadequately protected from surveillance and the misuse of data. Data protection is one obvious field this conflict is playing out on, and copyright is another.

The new EU Directive on Copyright seeks to establish democratic rules governing the public dissemination of works. Its detractors have not only been vociferous – they have also resorted to misleading forms of framing. The concepts of upload filters, censorship machines and link taxes have been injected into the discussion. They are based on false premises.

. . . .

What campaigners against copyright reform term “upload filters” are not invariably filters with a blocking function; they can be simple identification systems. Content can be scanned at the time of uploading to compare it to patterns from other known content. Such a system could, for example, recognize Aloe Blacc’s retro-soul hit “I need a Dollar.” Such software systems can be compared to dictation software capable of identifying the spoken words in audio files. At this point in time, systems that can identify music tracks on the basis of moderately noisy audio signals can be programed as coursework projects by fourth-semester students drawing on open-source code libraries. Stylizing such systems as prohibitively expensive or as a kind of “alien technology” underestimates both the dystopian potential of advanced pattern recognition systems (in common parlance: artificial intelligence) in surveillance software and similar use cases while also underestimating the feasibility of programming legitimate and helpful systems. The music discovery app “Shazam,” to take a specific example, was created by a startup with only a handful of developers and a modest budget and is now available on millions of smartphones and tablets – for free. The myth that only tech giants can afford such systems is false, as the example of Shazam or of enterprises like Audible Magic shows. Identifying works is a basic prerequisite for a reformed copyright regime, and large platforms will not be able to avoid doing so. Without an identification process in place, the use of licensed works cannot be matched to license holders. Such systems are, however, not filters.

. . . .

The principal argument of critics intent on frustrating digital copyright reforms that had already appeared to be on the home stretch is their charge that the disproportionate blocking of uploads would represent a wholesale assault on freedom of speech or, indeed, a form of censorship. Here, too, it is necessary to look more closely at the feasibility and potential of available options for monitoring uploads – and especially to consider the degree of efficiency that can be achieved by linking human and automated monitoring. In a first step, identification systems could automatically block secure matches or allow them to pass by comparing them against data supplied by collecting societies. Licensed content could readily be uploaded and its use would be electronically registered. Collecting societies would distribute license revenue raised to originators and artists. Non-licensed uses could automatically be blocked.

. . . .

Humans can recognize parodies or incidental uses such as purely decorative uses of works in ways that that do not constitute breaches of copyright.

The process of analysis could be simplified further by uploaders stating the context of use at the time works are uploaded. Notes such as “This video contains a parody and/or uses a copyrighted work for decorative purposes” could be helpful to analysts. The Network Enforcement Act (NetzDG) in Germany provides a good example of how automatic recognition and human analysis can work in tandem to analyze vast volumes of information. A few hundred people in Germany are currently tasked with deciding whether statements made on Facebook constitute incitement to hatred and violence against certain groups or are otherwise in breach of community rules. These judgments are significantly more complex than detecting impermissible uses of copyrighted works.

. . . .

Being obliged to implement human monitoring will, of course, impose certain demands on platforms. But those most affected will be the platforms with the largest number of uploads. These major platforms will have the highest personnel requirements because they can host content of almost every kind: music, texts, video etc. Protecting sites like a small photo forum will be much simpler. If only a modest number of uploads is involved, the forum operator can easily check them personally at the end of the working day. In that case, uploaders will simply have to wait for a brief period for their content to appear online. Or operators can opt to engage a service center like Acamar instead of adding these checks to their own workloads. Efficient monitoring is possible.

Link to the rest at The Trichordist

PG understands and sympathizes with the concerns of copyright owners about improper use of their property.

However, every online use of copyrighted material does not represent a loss of income to the copyright owner. Assuming there was a price tag associated with the use of such material, it could be omitted entirely or a substitute without a price tag could be selected.

While some uses of copyrighted material can be harmful, a great many of such uses may be viewed by 25 people who are unlikely to be paying consumers of that material.

Under US copyright law, the protected fair use of copyrighted material is often not a clear-cut matter. Reasonable people can disagree about whether a use is covered by fair use or not.

A significant number of owners of large catalogs of copyrighted material are extremely aggressive in their interpretation of what is protected by those copyrights. Disney and Mickey Mouse are but one example.

A couple of statements in the OP raised further concerns:

  • If only a modest number of uploads is involved, the forum operator can easily check them personally at the end of the working day.
  • In that case, uploaders will simply have to wait for a brief period for their content to appear online.

Exactly how is a forum operator who operates a small online site and supports it by working at a day job supposed to conduct an analysis of say 30 uploads to determine whether they may be subject to anyone’s copyright and, if they are, whether the use of the works was fair use or not? If a photo shows up in the uploads, how is the operator to determine who the creator of the photo is/was? If a photo has been modified by the person posting it, how is the operator to determine who the creator of the original photo was?

As far as “uploaders” waiting “for a brief period for their content to appear online”, PG suggests such delays may well adversely impact the quality of the online discussion. If an original post triggers a lot of responses, but those responses are held in moderation, are visitors to the online forum going to assume the post is irrelevant or is of no interest and perhaps leave the forum for good.

The killer among the breezy thoughts in the OP is, “Being obliged to implement human monitoring will, of course, impose certain demands on platforms.”

It will impose a serious and significant demand on platforms. If one were designing regulations to substantially reduce the amount of online dialogue about a wide range of subjects and the number of places where that dialogue occurs, imposing “certain demands” on those who sponsor such communities is a perfect way to make anything other than standard mainstream destinations and opinions to go away and rob the Internet of much of its innovative energy and independent thought.

If one were designing a system to ensure corporate control of online interaction, one might certainly do so on the pretense of protecting the words and pictures of copyright holders.

Digitized Images of Works in the Public Domain: What Rights Vest in Them?

19 February 2019

From IPKat:

A few days ago the German Federal Court of Justice (BGH) released the full text of its recent judgment concerning protection of digitized versions of public domain images. The IPKat is delighted to host, in two posts, the analysis provided by Tobias Lutzi (Research Fellow at the University of Cologne), and John Weitzmann(General Counsel at Wikimedia Deutschland e. V. in Berlin), respectively.

Here’s what John writes:

Note: The German Wikimedia Chapter had also been defendant in this case, but was acquitted by the court of first instance, while parallel proceedings against the US-based Wikimedia Foundation as service provider of the Wikimedia Commons platform are still on-going at the High Court of Berlin. 

. . . .

From the perspective of the Wikimedia Movement, the most disappointing aspects of the judgment are its treatment of § 72 UrhG, putting additional means of control over public domain works in the hands of those cultural heritage institutions, that regard control as an integral part of their public mission. As mentioned by Tobias here, it is highly questionable whether publicly funded museums should even consider using injunctions to go after digital copies of public domain works they hold in their collections.

If private owners of artworks are involved, there might be an argument for control on behalf of such private interests, in order to get the respective works into museums and before the public’s eye in the first place. But to limit the visibility of publicly owned works of art in any way, to leverage related rights in photographic depictions even with public domain works, can hardly be anything but a gross misunderstanding of the role and mission public cultural heritage institutions have. Such institutions must do anything within their power to hold as much of our cultural heritage in the public’s awareness, including on the internet, and therefore must not hide or withdraw public domain works from the public’s conscious perception.

. . . .

In all this, the judgment in the rem case almost tragically brings to bear the fundamental flaw of the hybrid rule that the German legislator produced by legally synching the neighbouring right in photographs, § 72 UrhG, to the proper copyright in photographic works, § 2 UrhG, in the 1960s. The intention behind this synching was a well-meaning one at the time: Parliament wanted to relieve judges of the close-to-impossible task of discerning non-original photographs from those that are actual works of art. Thus, § 72 was amended to let the same rules that apply to photographic works of art simply also apply to non-original photos – with the one exception of the protection term, which is shorter for non-original photos, lasting only 50 years after publication, whereas photographic works are protected until 70 years after the death of the photographer.

. . . .

[T]he High Court of Stuttgart had argued that even the meticulous reproduction photos in question (i. e. the ones made by the museum’s photographer for a catalogue that had later then been scanned by the defendant and uploaded to the Wikipedia’s media archive Wikimedia Commons) were not “mere technical reproductions”, but represent …

[22] (…) an independent new fixation into a new work form [and are photographs] initially made with creative intention. [own translation]

Now, one does not need to share the infamous fondness of dogmatic detail present in German civil law to find it odd that a second instance court introduces terms like “work” and “creative intention” (in German: “Schöpfungswillen”) when actually speaking about a neighbouring right in photographs. Usually, under German copyright law the term work (“Werk”) is much more narrowly than in the Anglo-American tradition reserved for works of authorship. That is the very reason de être of all those neighbouring rights in “non-works” in the first place. There’s a whole universe of arguments about the special bond between the work and its creator, and why that bond is so very special and valuable, even producing unwaivable moral rights.

. . . .

[C]an there actually be such a personal intellectual contribution or achievement in a photograph if the subject of the photograph is entirely fixed?

It can’t be stated enough: The content of reproduction photos is fixed in all thinkable ways. By definition they must as exactly as possible give the same impression as the works they depict, nothing added and nothing taken away. How can those repro photographs be more than “mere technical reproductions” if all the photographer can work with are shutter time, light, aperture and such – all of which go beyond technical in nature only if and where they are tools for creative expression? It must be emphasised yet again that any kind of creative expression is forbidden for repro photographers, who in this role strictly have to limit themselves to replicating the visual impression the object reproduced makes on viewers.

. . . .

[T]he pictures are indeed limited to getting the technicalities right to carry the exact impression of their object, being repro photographs in the proper sense. In that case, however, they can’t qualify as more than technical reproductions – very elaborate reproductions, one might add, that require a lot of expertise to make, but still reproductions.

. . . .

So, how can a tech-and-expertise-only reproduction photo still be covered by a neighbouring right that does not cover mere technical reproductions? The apparent contradiction is solved by invoking an additional criterion. The Court itself, turning to legal scholarship, established in 1989 (I ZR 14/88) the notion that only the first-stage exact photographic depiction taken of any subject is legally worthy of a neighbouring right protection, while further photos taken of this first photo are not and are seen as mere reproductions. This so-called “Urbildtheorie” has no explicit foundation in the wording of the German Copyright Code. It is purely a development of the law (in German “Rechtsfortbildung”) through judicial deduction and interpretation.

. . . .

There are paintings made by artists a long time ago, and exact photographic depictions of those paintings, protected under a neighbouring right because they are taken directly from the public domain works in the museum. However, had those artists of old used photography instead of brush and canvas to express their creativity, equally exact photographic depictions of such works of photography would not be covered by related rights. In other words, an exactly matching photo of a painting is protected, while an equally exactly matching photo of a photographic work is not.

Link to the rest at IPKat

Here’s a link to the first part the IPKat summary.

PG agrees with the criticism of the decision contained in the commentary (although he claims no expertise in German law).

The fundamental structure of copyright law in the US and, via international treaties, many other places, is based upon the proposition that the creator of an original intellectual property (painting, book manuscript, sculpture, for example) should have the exclusive ability control the exploitation of that property via copying or creation of derivative works for a period of time. An author can prevent someone from replicating the contents of a manuscript without the author’s permission, for example.

Once the copyright term has expired, the creator’s rights under copyright law expire as well.

The rationale for providing an ability to prevent a non-author from simply copying the work of an author, then exploiting it commercially or otherwise is that society in general is benefitted if creators are encouraged to create and share their creations by allowing them the exclusive right to profit from those creations. If there were no effective right for a creator to profit (monetarily, through enhanced reputation, etc), he/she would have to take a job at McDonalds flipping burgers for material support and thus would have less time to create and could well give up the creative activity altogether. Or a great artist would make paintings and never allow anyone to see them so the artist would avoid having others make copies of the products of the artist’s works of genius.

In exchange for a creator being permitted to prevent others who admired a work from simply making a copy of it for their own enjoyment or for commercial exploitation (a natural human instinct) and bring the creations into the public sphere for the artist’s exclusive benefit, the creator’s right to prevent the public from making knockoffs or derivative works was time-limited. Society would protect the creator’s work from reproduction for a period of time so the author could profit and society would benefit from being able to enjoy the work right away, but eventually, the creator’s exclusive rights would expire so other creators or non-creators could use the work for all sorts of new and interesting purposes.

However, intellectual property must have a meaningful element of originality to be protected. If I pick up a rock and paint it red, then seek to prevent anyone else from commercially exploiting rocks painted red, I’ve done something unoriginal and obvious, not truly new or unique or creative. The same analysis would prevent me from copyrighting the words, “and they lived happily ever after.”

With that rambling foundation, why was the German court so wrong?

The artist who created the painting that is now in a German museum owned the copyright to the original painting. The clock was ticking on the copyright’s exclusive period of protection. Presumably, when the artist sold or gave the painting to someone else, the person who acquired the painting acquired the associated copyright, including the right to exercise the rights granted under copyright law in the same manner as the original artist could.

(It is possible for the artist to retain the copyright, while only selling the painting itself, but absent some sort of clearly documented agreement to that effect, the copyright is presumed to go with the painting. This is why authors should only license their copyrights rather than assigning them to publishers unless the publishers pay a large lump sum (not an advance against royalties) up front. If the publisher fails to pay royalties and the publisher owns the copyright, the author has a more difficult time reverting rights to him/herself. An artist who creates a painting is more likely to sell a painting to someone who wants to own it and who pays to acquire the painting rather than agreeing to pay the artist a certain amount for each copy of the painting the purchaser might or might not make.)

What (in PG’s inarticulately expressed opinion) can a museum that has just acquired a painting for which the artist’s copyright has expired do if the museum wants to profit from selling copies of the painting?

The museum could do what the original artist could do, not show the painting to anyone to prevent copying.

Or, the museum could prohibit anyone from bringing a camera into the museum and search pockets/purses, etc., to make certain everyone complies. Or a museum could bind visitors to a contract under which visitors agreed they would not take photos of the painting and further agreed that they would pay the museum $1 million in damages if they violated the contract.

In the German case, the court held that the museum could make a photograph — a copy — of a painting that is no longer protected by copyright, claim a copyright in the photo, then use its copyright of the photo to prevent other people from making, publishing, selling, etc., copies of the original painting because doing so would be the same as making a copy of the museum’s photo of the painting.

In addition to the arguments cited in the OP (a perfect copy of the painting made via a camera does not include elements of creativity to sufficient for the photo to be entitled to copyright protection), PG suggests permitting a photo of an original painting that is not protected by copyright to be copyrighted as if the photo were its own separate creative work, thus starting a new period of copyright protection that prohibits copies of the painting to be made and sold without the permission of the museum is the most slippery of slippery slopes.

When the copyright on the photo is nearing expiration, could a future technology that is not like a camera be used to make another copy of the painting, thus generating a new period of copyright protection that would continue to prevent anyone other than the museum from making copies of the then way, way, way out of copyright painting?

How about using the new technology to make a new copy of the previous copy of the museum’s copyrighted photo and claim a new period of copyright protection on the same basis the court recognized a perfect copy of the original painting to form the basis for a separate copyright – that the operator of the new technology made adjustments necessary for the use of that technology to make another perfect copy?

The museum claimed all of the things the photographer did in order to make a perfect copy – setting the camera properly, lighting the painting just so, etc., represented new creativity that was incorporated in the perfect copy of the painting.

In the United States, this argument would be termed as a claim of copyright based upon “sweat of the brow” activity. See Genesis 3:19 – “In the sweat of thy face shalt thou eat bread, till thou return unto the ground”

From Wikipedia:

According to this doctrine, an author gains rights through simple diligence during the creation of a work, such as a database, or a directory. Substantial creativity or “originality” is not required.

Under a “sweat of the brow” doctrine, the creator of a copyrighted work, even if it is completely unoriginal, is entitled to have his effort and expense protected, and no one else may use such a work without permission, but must instead recreate the work by independent research or effort. The classic example is a telephone directory. In a “sweat of the brow” jurisdiction, such a directory may not be copied, but instead a competitor must independently collect the information to issue a competing directory. The same rule generally applies to databases and lists of facts.

Link to the rest at Wikipedia

This argument was rejected by the US Supreme Court in  Feist Publications v. Rural Telephone Service, 499 U.S. 340 (1991).

Discussing the principle that facts are not copyrightable, but that compilations of facts can be, the Court said,

Article I, § 8, cl. 8, of the Constitution mandates originality as a prerequisite for copyright protection. The constitutional requirement necessitates independent creation plus a modicum of creativity. Since facts do not owe their origin to an act of authorship, they are not original, and thus are not copyrightable. Although a compilation of facts may possess the requisite originality because the author typically chooses which facts to include, in what order to place them, and how to arrange the data so that readers may use them effectively, copyright protection extends only to those components of the work that are original to the author, not to the facts themselves. This fact/expression dichotomy severely limits the scope of protection in fact-based works.

Applied to the German case, if the photographer’s objective and accomplishment was to make as perfect a copy of the original painting as is possible using current technology, then, if copyright protection extends, per Feist, only to those components of the photograph that are original to the photographer, not to the components of the photograph that are original to the artist who created the original painting, there is no copyright to a perfect copy of the painting.

If the photographer had used the camera to make a photo that looked different from the original painting, substituting red for blue, for example, an argument for originality might be reasonable and anyone else making a copy of the red/blue photo might be violating the museum’s copyright on the photo.

But a perfect copy of the original painting includes nothing original to the photographer. Anything the photographer might have done that isn’t reflected visually in the resulting photograph doesn’t indicate anything original to the photographer is protected in the perfect copy. PG would argue that even trivial differences between the photo and the painting that result from the transfer of the image from one medium to another don’t constitute originality necessary for copyright protection.

Following is an English version of the German Court decision (per Google translate – PG does not speak German, so he can’t vouch for any level of accuracy)

A1 - BUNDESGERICHTSHOF

Amazon Will Pay a Whopping $0 in Federal Taxes on $11.2 Billion Profits

16 February 2019

From Fortune:

Those wondering how many zeros Amazon, which is valued at nearly $800 billion, has to pay in federal taxes might be surprised to learn that its check to the IRS will read exactly $0.00.

According to a report published by the Institute on Taxation and Economic (ITEP) policy Wednesday, the e-tail/retail/tech/entertainment/everything giant won’t have to pay a cent in federal taxes for the second year in a row.

This tax-free break comes even though Amazon almost doubled its U.S. profits from $5.6 billion to $11.2 billion between 2017 and 2018.

To top it off, Amazon actually reported a $129 million 2018 federal income tax rebate—making its tax rate -1%.

. . . .

ITEP notes that its non-existent federal tax payment is a result of the Trump Administration’s corporation-friendly tax cuts. The think tank writes that the 2017 Tax Cuts and Jobs Act not only decreased corporate tax rates from 35% to 21%, but it also didn’t close “a slew of tax loopholes that allow profitable companies to routinely avoid paying federal and state income taxes on almost half of their profits.”

Link to the rest at Fortune

PG apologizes for the annoying auto-play video with an accompanying audio track in the OP.

PG also notes that Amazon doesn’t write the federal or state tax codes and PG hasn’t seen any reports that Amazon has violated any of those laws.

As far as tax “loopholes” are concerned, one person’s loophole is another person’s reasonable provision for calculating a fair tax rate.

One of the most commonly-used deductions for individual taxpayers is the mortgage interest deduction. If an individual or couple purchased a home and borrowed money to help fund that purpose, the interest they pay on that loan is deductible from their gross income.

The rationale for this loophole is a belief by the elected representatives of the people that a great many benefits arise when citizens are able to purchase and own their homes. Community stability and the encouragement of civic virtues due to lower rates of transience within a community, encouragement for couples to have children, the benefits to those children (and future taxpayers) that arise from being able to grow up in a single home and attend neighborhood schools as compared to moving to a new location every one-two years due to rent increases on a rented residence, etc., etc., etc.

While there are counter-arguments, PG suggests the home mortgage deduction is highly-valued by a large majority of the adult population of the United States.

When dinosaurs walked the earth, PG took a couple of income tax law classes in law school and several of his classmates earned their Masters of Law in Taxation after completing regular law school.

The complexity and weirdness of the US tax laws cannot be overstated. There are tax attorneys in the United States who earn a good living for their entire careers by specializing in the application and avoidance of taxes imposed under a couple of provisions in the tax law that most people have never heard of and would have difficulty in understanding without extensive prior tutoring in the nearly impenetrable language and concepts and conflicting interpretations of such underlying those laws.

Each of the 50 states have their own individual tax laws and the potential number of unintended interactions between state and federal tax laws probably cannot be calculated.

Speaking only of the US tax laws, there are disagreements about how long they are. In 2015, the Tax Foundation said the Federal Tax Laws and Regulations total more than ten million words.

This figure includes the federal internal revenue code (2,412,000 words long) and federal tax regulations (7,655,000 words long). It does not include the substantial body of tax-related case law that is often vital to understanding the tax code.

The length of the federal tax code and regulations has grown steadily over the past sixty years. In 1955, the two documents were 1.4 million words in length. Since then, they have grown at a pace of about 144,500 words a year. Today, the federal tax code is roughly six times as long as it was in 1955, while federal tax regulations are about 2.5 times as long.

. . . .

Americans spend 6.1 billion hours and $233.8 billon complying with the tax code. Due to increasing tax complexity, over 90 percent of taxpayers now hire professional tax preparers or use tax preparation software.

Why is the federal tax code so complex? In part, it’s because politicians have used the tax code to administer dozens of areas of federal policy – from healthcare to energy to education. In part, it’s because defining income and determining tax liability are inherently difficult tasks. And, in part, it’s because politicians have not made any serious effort to simplify the federal tax code for at least thirty years, instead adding on new provisions on top of one another.

The federal tax laws are so lengthy that there are disputes about how long it actually is. Again, from The Tax Foundation in 2014:

Andrew Grossman, the legislation counsel for the Joint Committee on Taxation that helps write tax laws, attacked us in Slate yesterday for saying that the tax code runs 70,000 pages, countering that it’s “only” 2,600 pages.

. . . .

There’s the literal statutes that Congress has passed (Title 26 of the U.S. Code). The Government Printing Office sells it spread over two volumes, and according to them, book oneis 1,404 pages and book two is 1,248 pages, for a total of 2,652 pages. At perhaps 450 words per page, that puts the tax code at well over 1 million words. (By way of comparison, the King James Bible has 788,280 words; War and Peace runs 560,000 words; and the Harry Potter series is just over 1 million words.)

. . . .

However, a tax practitioner who relies just on the tax statutes will go to jail, because so much of federal tax law is in IRS regulations, revenue rulings, and other clarifications. Congress will set down a policy and leave it to the IRS to write all the rules to implement it. These regulations aren’t short: the National Taxpayer Advocate did a Microsoft Word word count of the tax statutes and IRS regulations in 2012, and came up with roughly 4 million words. Again at roughly 450 words per page, that comes out to around 9,000 pages. The National Taxpayer Advocate also noted that the tax code changed 4,680 times from 2001 to 2012, an average of once per day.

. . . .

But, a lawyer who relies just on cases and regulations isn’t a very good lawyer, because most court decisions are made on the basis of previously decided cases. The respected legal publisher Commerce Clearing House (CCH) puts out such a compilation, the Standard Federal Tax Reporterof 70,000 pages, with notations after each statute containing relevant cases and other information. CCH itself considers this volume to be representative of “the tax code,” since an expert needs to know all 70,000 pages to understand the tax code in full.

So, has Amazon paid its “fair share” of income taxes? PG is highly confident that Amazon has used well-qualified tax experts to prepare its tax returns and calculate its tax liabilities.

For a long time, Amazon had no taxable profits at all. Indeed, it had losses. One of the concepts contained in various parts of the federal income tax laws is a “tax loss carry-forward”. Investopedia describes this as follows:

A tax loss carryforward is a provision that allows a taxpayer to carry over a tax loss to future years to offset a profit. The tax loss carryforward can be claimed by an individual or a business in order to reduce any future tax payments.

Amazon operated at a loss for the first several years of its existence and very thin profits for a lengthy period of time thereafter. To the best of PG’s knowledge, Amazon received no material payments from the US government to help it survive during those years.

Absent the benefits of loss carryforwards during the first years of lean profits, it’s possible that Jeff Bezos would have given up on the possibility that Amazon was ever going to be worth the very hard work he was putting into the company and closed it down so he could spend time working in another more financially-rewarding business.

Amazon currently reports it has 613,300 employees. PG suspects Amazon pays far better wages than McDonald’s does and each of those employees pays individual federal income taxes. From the standpoint of federal government tax revenues, is it a good thing for a company to employ over half a million people who each pay taxes? Would the country be better off if Amazon paid some corporate income taxes, but only employed 50,000 people?

PG will also note that, for its US employees, the company pays a huge amount of money into Social Security and Medicare as its employer’s share of those taxes, which are based upon the wages of its employees.

What Happens When Billionaires Battle Gossipmongers?

9 February 2019

From The Washington Post:

Both men have gobs of money.

They didn’t make it the old-fashioned way, with steel and brick, but instead with big, disruptive, life-changing ideas.

After they got rich, after they’d achieved a titan status imaginable only in the digital age, that’s when the tabloids came for them.

And that’s when they went to war.

Theirs is a tale of two billionaires — Jeffrey P. Bezos of Amazon.com fame and Peter Thiel, who birthed PayPal. So different in style and temperament, the two men have each found their sex lives splashed in public against their wills in separate tabloid “gotchas.” But they have tangled with the merchants of salacity in completely opposite ways.

Bezos, who also owns The Washington Post, blasted his disdain into the maw of the Internet, essentially delivering the equivalent of a lawyer’s opening statement with the entire planet sitting in the jury box. Thiel operated in sotto voce fashion, secretly maneuvering to exact revenge and not surfacing until he had triumphed.

Bezos is locked in a conflict with the National Enquirer, which last month published intimate text messages he’d sent to Lauren Sanchez, with whom he was having an extramarital affair, and photos of them together. In a Medium post Thursday, Bezos accused the supermarket tabloid, which is owned by American Media Inc., of blackmail and extortion for threatening to publish additional intimate photographs if he and his representatives did not agree to stop their investigation of the how the material was obtained. Bezos suggested that the tabloid, whose parent company is run by a friend of President Trump, had political motives to run stories about his affair. Trump has frequently attacked Bezos over his ownership of The Post.

Thiel’s battle took place against Gawker, the sassy and sometimes raunchy website that earned his eternal enmity by outing him as gay in 2007. He got back at the site in 2016 when he surreptitiously funded a successful lawsuit by Terry Bollea, better known as the wrestler Hulk Hogan, over the site’s 2012 publication of a tape depicting Bollea having sex. Gawker went out of business after a jury awarded $140 million in damages.

“They are two fundamentally different approaches to similar problems,” said Ryan Holiday, author of “Conspiracy: Peter Thiel, Hulk Hogan, Gawker, and the Anatomy of Intrigue.”

When Thiel’s involvement in the Bollea case was revealed, Bezos was less than enthusiastic about his fellow tech titan’s actions. At a conference in June 2016, Bezos was asked about the Thiel-Gawker slugfest. He responded with an old saying: “Seek revenge and you should dig two graves, one for yourself.”

“Is that really how you want to spend your time?” Bezos went on to say. “As a public figure, the best defense to speech that you don’t like is to develop a thick skin.”

Those remarks came to mind for Bezos watchers after his posting on Medium, a self-publishing website.

. . . .

In the first paragraph of Bezos’s post, he frames his decision to publicize letters he had received from the National Enquirer as evidence of wrongdoing — a step beyond berating the tabloid for publishing details of his private life.

“Rather than capitulate to extortion and blackmail, I’ve decided to publish exactly what they sent me, despite the personal cost and embarrassment they threaten,” Bezos wrote.

The saga is drenched in a hailstorm of theories and counter-theories. Bezos’s team, headed by famed security consultant Gavin de Becker, has cast a suspicious eye on Michael Sanchez regarding the leak of the texts and photos. Sanchez is the brother of Bezos’s girlfriend, former TV host Lauren Sanchez. Michael Sanchez is a Trump supporter, and his potential involvement is part of a theory that the leak is a political hit.

. . . .

Both Sanchez and de Becker have, at times, explored the possibility that the text messages were obtained by a foreign government or a business competitor, according to interviews and a Post review of emails and text messages. Sanchez has even posited that Israel’s Mossad, British intelligence or the U.S. National Security Agency might be involved. (De Becker ultimately concluded that hacking was not involved.)

Link to the rest at The Washington Post

PG hopes he is wrong, but, more than once, he has had the feeling that, a few years down the road, we may look back on this series of events as a turning point for Amazon.

From the beginnings of Amazon, Bezos has put his distinctive personal stamp on the company in the same way that Steve Jobs and Bill Gates built very large companies which seemed to be reflections of their very different personalities.

Jobs, of course, was forced to give up his management position due to cancer while Gates retired from Microsoft in an orderly fashion, but neither company has been the same since the person with the dominant vision that drove its tremendous growth departed.

For PG, Microsoft has become the most boring large tech company in the world. Windows continues. MS Office continues. Like a power utility company, each relies primarily upon its quasi-monopoly position to keep the dollars rolling in.

New Microsoft products seem to be lame derivatives of products originated elsewhere. Microsoft Surface is an iPad wannabe. Why does Edge even exist? MS is into producing products and services that are derivative of its own ancient good ideas or the ideas of others.

On the other hand, Apple is much less boring because post-Jobs management has made the mistake of believing it can continue to raise prices without doing anything really new. Now it’s in the process of cutting prices on its iPhones and iPads to stem a significant decline in sales and the new ideas in mobile phones are all coming out of China.

So what do we make of Bezos and Amazon?

Has Bezos lost his mind? He’s supposed to be reliably brilliant.

The year is 2019 and intelligent people don’t take nude selfies and text them to other people. That’s a mistake that any intelligent sixteen-year-old who wants to get into a good college will not make.

Additionally, intelligent people haven’t gotten into big fights with The National Enquirer for decades. Bezos already bought The Washington Post. He should have purchased The National Enquirer and fired everybody he didn’t like.

When he spent a lot of his time in court, PG had to talk more than one client out of suing someone because the collateral damage to the client’s reputation would far exceed any monetary benefit the client would derive. On such occasions, he would sometimes quote George Bernard Shaw.

I learned long ago, never to wrestle with a pig. You get dirty, and besides, the pig likes it.

~ George Bernard Shaw

The Growing Importance of Intellectual Property

31 January 2019

From Kristine Kathryn Rusch:

I need to be clear as I start this post. We writers create intellectual property. We license our copyrights. We do not sell stories. In fact, the stories we tell, along with their titles, are often not copyrightable. The form in which we tell that story—the order of the events, the order of the words we use,—those things are copyrightable, but the basic boy meets girl, boy loses girl, girl discovers she’s fine on her own storyline can and does fuel a thousand books and movies. (That’s why so many memes over the holiday season made fun of the romance movies on Hallmark. Because the movies—all copyrighted in their own right, all different in the copyright sense—share a lot in common.)

If you don’t understand copyright and you consider yourself a professional writer, then you do not understand the business you are in. If you have published a novel, traditionally or indie, and you do not understand copyright, you are volunteering to get screwed over and over and over again. I say this often, and I’m saying it loudly again, because the trend for 2019 and beyond is that every organization you do business with will try to take a piece (if not all) of your copyright on each and every one of your projects.

Your job is to protect that copyright.

. . . .

Forbes actually published an article in fall of 2018 titled “What Authors Should Do When Their Publisher Closes.” You can click over there if you want. The advice isn’t good, because as someone in the article says, what an author should do varies based on the author’s contract. And if the author has an agent, then they’re probably screwed. If the author doesn’t understand copyright, then they’re definitely screwed.

. . . .

I recommend publishing indie, because that’s the best way to protect yourself and your writing income. You’ll have a career if you do that. Your career might vanish on you if you try to remain traditional. Or, rather, you will write as a “hobby” while you make your living doing something else.

Yes, I’m being harsh, but that’s because the intellectual property apocalypse that I’ve been warning you about is upon us. The trends are there, and the signs that traditional publishing (and all of the other big entertainment organizations) know about the value of intellectual property are becoming clearer and clearer.

. . . .

For years now, the Big 5 traditional publishers have had contracts that essentially transfer the entire copyright of a novel from the author to them. The contracts don’t say that explicitly, but when you read the contract as a complete document (which is how you should read it), you realize that the sum total of what the clauses mean is that the writer retains no part of the copyright, and is only entitled to a tiny percentage of the money that copyright earns.

The reason these contracts changed about a decade ago had nothing to do with publishing and everything to do with mergers. As these publishing companies became part of big international conglomerates, many of them entertainmentconglomerates, the legal teams redrafted the contracts to do the copyright grabs.

Most writers had no idea what they were signing, and most of their agents didn’t either. Agents are not trained lawyers. A handful of the big agencies have lawyers on staff, but most of those agencies are concerned with making the agency money, not with making the writer money. So a lot of the contracts are structured to pay and protect the agent, while bilking the writer.

. . . .

Up until a year or so ago, most of the Big Five continued to operate like traditional publishing companies have since the 1990s—a focus on publishing a lot of titles, hoping that some will stick and become bestsellers. But that strategy isn’t working, and sales are down precipitously.

. . . .

[Simon & Schuster] has been in a media conglomerate since the 1980s. I’m not going to go through its tortured history, which runs from Paramount to Viacom and beyond, but realize this: It became part of the CBS Corporation officially in 2005. Around then, it became impossible to get book rights reverted, which is one of the tricks that is recommended for writers in the Forbes article I cited above. (How 1995. Sigh.)

S&S has experimented with electronic books since the 1990s. Dean and I personally made a lot of money in the early 2000s when S&S realized they hadn’t licensed e-rights for Star Trek books. (Dean and I wrote a bunch of them in the 1990s). S&S has tried to have a self-publishing arm since 2012, and they’re doing a lot of things that require writers to pay for services that publishers used to provide.

. . . .

The more IP a company acquires, the more its value goes up. Even if they don’t create anything from that IP. Acquiring a novel’s copyright—with all its potential spinoffs, TV shows, toys, comics—increases a company’s value tremendously.

Read that paragraph again, because the information therein is the key to this whole piece.

The more IP a company acquires, the more its value goes up. Your novel is IP. If they acquire it, their bottom line goes up, even if they never do anything with that IP. Got that?

That’s why S&S stopped, in 2000 or so, reverting the rights to the novels they acquired. Those novels equal more earnings potential—and they allow the company to maintain a value that it wouldn’t have otherwise.

I’ve been warning writers about this copyright grab by corporations for some time, but it was easy to ignore me because the Big 5 have not been (for the most part) exploiting (the legal term for developing or making use of) that copyright.

S&S finally is. That’s what Simon & Schuster’s CEO Carolyn Reidy’s heady year-end report was really all about. She called 2018 “the most successful year in Simon & Schuster’s history,” and yet she didn’t cite a single print bestseller as something that caused the success.

Instead, she touted the rise in audio . . . as well as a mention that sent a little shiver through me.

She wrote:

…[backlist sales now] comprise a higher portion of our revenue than at any time in memory…while readers wanting the tried and true is an industry-wide phenomenon, our concerted effort during the last few years to acquire books with the potential for long-term backlist sales has yielded dividends.

This article does not specify what exactly she means by “backlist sales.” Does she mean actual ebook and print sales, or other licensing, such as foreign rights and so on? Clearly S&S is exploiting the audio rights clauses in their contracts.

What is clear, however, is that a big traditional publisher has finally figured out that not only does their backlist have value in raising the company’s worth, but it also has earnings potential that can be exploited in 2019.

Why does this send a chill through me? Because if one traditional publisher learns it, the others will learn it as well. And the ability of writers who have sold their work into traditional publishers to get the rights reverted will go down to almost nil.

Big traditional publishers will finally join their counterparts in the entertainment industry—the movie/TV companies, the music studios, the game companies—in demanding control of every aspect of the copyright from the original author.

Which means that if an author signs one of those agreements, the author will get pennies on the dollar (if that) for any rights—audio, movie, TV—rather than the kind of earnings writers could have gotten as recently as 10 years ago.

. . . .

And those of you who licensed mass market rights a few years ago, thinking you’d get your ebooks into stores, you probably already signed away most of the copyright, particularly if you went with Harlequin or Simon & Schuster.

Link to the rest at Kristine Kathryn Rusch

Here’s a link to Kris Rusch’s books. If you like the thoughts Kris shares, you can show your appreciation by checking out her books.

As usual, Kris incorporates a lot of intelligent business thought and advice into the OP (and her other posts in this series).

As PG has mentioned before, he has negotiated, drafted and/or reviewed a great many contracts during his legal career, including some large technology copyright and patent licensing agreements. As he has also mentioned before, the typical contracts between authors and traditional publishers are some of the most unfair and one-sided agreements he has seen.

In a prior era during which it was impossible for an author’s works to reach any sort of meaningful audience without a publisher to cover the costs of printing books and provide meaningful access to buyers for large numbers of physical bookstores, perhaps the value of a publisher’s services was an extremely large portion of the income generated by sales of a book.

However, in an age in which:

  • Amazon is the largest English language bookseller in the world; and
  • Opens its electronic doors to self published authors on terms substantially equivalent to those it provides commercial publishers; and
  • Ebooks have the highest profit margin of any edition of a book a publisher sells; and
  • Ebook editing, formatting and cover design of a quality comparable to that provided by a commercial publisher can be had for a few hundred to a few thousand dollars;

the real value of a publisher for a typical author compared to the effective cost of a publisher to that author has declined precipitously.

PG was about to discuss the value of branding for either an ebook or a printed book, but he will be uncharacteristically brief.

Does anyone go to an online or offline bookstore seeking out a Random House book? Of course not. They’re looking for an author, a genre, etc.

With respect to promoting and selling books, which brand name is most valuable, James Patterson’s or Little, Brown and Company’s?

Without singling out any particular literary agent or agency, PG will say, as a general observation, that agents famous and obscure don’t do anything significant to improve the contract terms for publishing contracts other than increasing the amount of the advance on some occasions. In particular, agents rarely if ever do anything to address the issues Kris discusses in the OP.

In some types of contracts — consumer loans, for example — federal and/or state legislatures have passed laws that prevent commercial lenders from including some contract provisions that are unfair or harmful to borrowers. Compared to the number of individuals who take out loans to purchase a house, automobile or dishwasher, however, authors are a tiny constituency and elected officials have much bigger fish to fry than commercial publishers.

However, perhaps as a result of such consumer protections, some authors may believe they are somehow protected from  unfair provisions in publishing contracts between themselves and large publishers. That belief is incorrect.

Some of the most unfair provisions in a typical publishing contract are presented in the most innocuous manner imaginable.

 

 

Finally, there is nurturing. Publishers don’t just produce books. They nurture. Literary agents also provide nurturing in case publishers fall short in any way.

Like a baby duckling, a baby author needs to be nurtured and petted and encouraged and gently guided if she/he is to grow into a beautiful swan.

Who better to nurture such a delicate creature than a Kommanditgesellschaft auf Aktien headquartered in Gütersloh?

Off the top of his head, other than publishing, PG can’t ever remember ever having a business discussion that included the word nurture or any of its variants.

PG is reminded of a quote attributed to former president Harry S. Truman, “If you want a friend in Washington, buy a dog.”

PG suggests that if you want someone to watch over you, steer clear of the publishing business.

.



Next Page »