The Piracy Wars Are Over. Let's Talk about Data Incumbency

Sometime in March or April, the European Parliament will vote on a set of major changes to European copyright law, including the creation of taxes on links and mandatory filtering for websites with user-submitted content. The debate around the proposals will be familiar to anyone following Internet policy over the last couple decades. Advocates say the proposals will help protect creative content like music, movies, and news from piracy. Critics fear that the changes will threaten rights to expression, and diminish competition and innovation. Put me strongly on the side of the critics, as far as the proposals go.



Joe Karaganis is Vice President at the American Assembly at Columbia University.

But let’s also talk about the deeper problem with policymaking in this area and why it persists. As report after report has noted over the years, there is very little data available to evaluate these proposals and their tradeoffs. And that’s not an accident.

The dearth of data on how the big intermediaries—record labels, studios, publishers, and now internet platforms like YouTube, Amazon, and Spotify—structure cultural markets is a long-standing problem. These companies tell creators how much they’re getting paid, but rarely disclose who else is getting a cut, how their peers are paid, and what factors contribute to differences in promotion or placement. They reveal little about the flow of content, attention, and money that make up these ecosystems.

The reason for this secrecy isn’t a mystery. It’s a big advantage to know more about your market than your competitors, users, customers, and—ultimately—regulators. Controlling this information raises barriers to competition and makes it easy for anyone sitting on the information-poor side of a negotiation to get taken advantage of without quite being able to specify how. Musicians have been complaining about these issues for decades in relation to recording contracts and, more recently, streaming revenues , where artists get around 15% of the total. So have actors and writers, to the point where the phrase “Hollywood accounting” is a byword for accounting scams.

The EU copyright proposals reflect the view that the main problem for artists is still Internet “piracy” in different forms, such as the notional “ value gap ” between what the recording industry gets paid for licensed music by YouTube and other platforms, and what it thinks it should get paid. But at this point even the older intermediaries have adapted to the era of cheap digital abundance. Streaming services are everywhere. The production of movies, TV shows, music, books, and so on is at all-time highs . Revenues, even in the recorded music business, have rebounded . The return on more copyright enforcement, in this context, is likely to be low and is guaranteed to be captured by the same black box industry accounting. If we want to address the underlying problems of the cultural economy for artists, we need to open that black box. We need to address the power of data incumbency in the creative economy.

We should start by recognizing that calls for voluntary data disclosure don’t work. As most researchers working in this area know, academic requests usually go nowhere. Efforts at collective action—such as for the Creator’s Bill of Rights, a “ Fair Music” seal of approval for platforms and labels, the Data Consortium for Media and Communications Policy that I worked on for several years—gain no traction.

In practice, almost all successful steps toward systemic (rather than occasional, ad hoc) data disclosure have been linked to regulatory pressure or fears of liability. It took Congress to kickstart progress on a public, unified music rights database that could consolidate the various music industry data fiefdoms . It took a decade of escalating scandals and Congressional threats to push Facebook into data sharing arrangements with academics—and then only on the radioactive topic of electoral interference. It took fear of abusive lawsuits to get Google and a few other online platforms to publicly archive copyright complaints .

What would an open data agenda for the creative economy look like? It could begin public ownership registries and open metadata standards , which would create a shared framework for identifying and tracing the ownership of copyrighted work. It could include measures to strengthen competition for users among platform services, such as the ‘data portability’ requirements built into the European GDPR or the more ambitious idea of reorganizing simple platform functions (like social media or video posting) around open protocols analogous to email. It could include reporting on the display results for content on online platforms, especially as Netflix, Amazon, Google, Apple, and others become vertically integrated businesses that compete with third-party content. The EU is talking about this at the level of principles, if not yet applications. Open data requirements would also need to work in areas where precedents are thin, including data on flows of attention, activity, and money, as well as the private agreements that shape the treatment of content. They would look at cultural ecosystems rather than just the Internet, and so encompass both offline and online intermediaries.

What would we get for all of this data activism? Open data requirements could make it clearer who is providing a valuable service and who is primarily exploiting information asymmetries between creators and services. They could help identify the genuine rip-offs that thrive on opacity, such as the chronic underpayment of artists or the role of concert organizers in ticket black markets . They could help answer the perennial question of whether streaming payments and other licensing schemes are fair to artists, based not on a notional ‘value gap’ but on who else is getting a cut. And they could provide better instruments than we have, currently, for understanding the relationship between size and power in the digital economy and how to address it without shooting ourselves in the feet.

If extended across the value chain, open data requirements would have the virtue of asking something of all the systemically important intermediaries—the major Internet platforms, collecting societies, labels, publishers, concert organizers, and others—who are often sharply at odds on copyright and other regulatory issues. It is a cliché to say that a successful negotiation is one in which none of the participants go away happy. But this could be one of those cases.

These issues are hard, but not insurmountable. The U.S. used to have an expansive view of the relationship between data disclosure and the public interest responsibilities of media companies. Reporting on size, audiences, programming, employment and other factors came with the territory. We can construct similar principles for the Internet era, both with respect to what’s good for individual creators and what’s good for the larger public. Or we can fight damaging side battles on copyright and take the word of the platforms, labels, and other intermediaries that—on the underlying issues—they’ve got it covered.

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