ArtsWatch: Found: $74 Billion

Under its new chief, Department of Commerce revises GDP statistics and issues new Internet policy report
August 05, 2013 -- 6:45 am PDT
By Philip Merrill /

In recent news ...

How To Make $74 Billion With Creative Content
On July 31 the U.S. Department of Commerce made its presence felt in the ongoing copyright debates with a mighty twofer. The agency's Bureau of Economic Analysis recalculated its gross domestic product statistics to treat "entertainment, literary and artistic originals" as capitalized intangible assets instead of expenses, revising last year's GDP up by $74 billion. The change was commended by the MPAA and RIAA. Separately, the department's Internet Policy Task Force released a comprehensive policy update titled "Copyright Policy, Creativity, And Innovation In The Digital Economy." Sworn in as Commerce Secretary on June 26, Penny Pritzker said, "The reasons to protect creative works go well beyond the economic benefit. America's writers, musicians, filmmakers, photographers, sculptors and other creators make up the lifeblood of our culture. ... We must continue to nurture such extraordinary creative resources." The report's Appendix A lists action items fundamental to copyright's continued evolution, and Appendix B tallies organizations that provided input to the report, including content organizations Copyright Alliance and MPAA, consumer advocates Public Knowledge and the Computer & Communications Industry Association. All four praised the report. Public Knowledge Legal Affairs Vice President Sherwin Siy criticized the results as lacking detail on "the negative effects of certain copyright enforcement policies on the public," but added, "We are also happy to see that the paper recognizes the growing concern that sound recording artists are not compensated for over-the-air radio performances of their work." CCIA Law & Policy Vice President Matt Schruers accused the report's recommendations as "overlooking problems that only the government can solve" and said, "the government needs to ... help industry go on the offense in the marketplace, by crafting solutions to help new services navigate licensing gridlock, technology discrimination, and poor registry information." Those are nuanced and reasonable criticisms from groups often found opposing the interests of content creators, suggesting hope for real progress ahead.

House Hears From High-Tech Heroes Panel
The House Judiciary Committee's Subcommittee on Courts, Intellectual Property and the Internet held a hearing titled "Innovation In America: The Role of Technology" on Aug. 1, a hearing intended to complement the previous week's hearing, "The Role Of Copyrights." The panel was a surprisingly admirable selection of small-business founders, including representatives from the nonprofit social enterprise organization Benetech, crowd funder Indiegogo, cloud ISP Rackspace Hosting, video-search platform developers SnapStream Media, and educational electronics manufacturer SparkFun Electronics. If all technology innovators were such friendly and sincere champions, it is hard to imagine that the copyright and tech industries would ever have trouble getting along. Arguably these small companies are small and vulnerable, hoping their relentless drive to innovate will keep them competitive and that they don't get sued out of existence by litigious deep pockets. Although Rackspace Vice President of Intellectual Property and Associate General Counsel Van Lindberg complained about automatically generated copyright takedown notices that were genuinely senseless, such as companies requesting their own website be deleted for infringement, his bigger problem was baseless litigation from patent trolls. In fact, the slow pace and expense of the patent system makes patents impractical for these businesses. The subcommittee was understandably charmed but there was a borderline lack of relevance to how the day's testimony fit into the series of hearings reviewing how copyright law should be updated. Cooperative innovators who don't profit from infringement have not been noteworthy targets for copyright enforcement action.

Drawing Fire, Pandora Hires New Top Gun
On July 30 Reps. Marsha Blackburn (R-Tenn.) and Judy Chu (D-Calif.) contributed "Stop Short-Changing Songwriters," an op-ed in The Hill focusing on "the pitifully low royalty Pandora pays to songwriters." The lawmakers wrote, "In updating our nation's copyright laws, our role as members of Congress should be to ensure the law enables songwriters to get paid a fair market rate for their hard work." Separately, ASCAP filed a petition with the Federal Communications Commission on July 25 to deny Pandora's application to operate terrestrial radio station KXMZ-FM. ASCAP argues that Pandora failed to completely disclose whether it complies with limitations on foreign ownership and also that their application is clearly not in the public interest of the radio station's community since Pandora acquired it to use as a "bargaining chip" in royalty negotiations. On July 30 The Hill reported that Pandora has retained the services of outstanding technology advocate Maura Colleton Corbett and her Glen Echo Group. Corbett is a member of the board of directors of consumer advocates Public Knowledge and has unique experience in building tech-friendly coalitions, so it seems likely Pandora's strategic arguments are about to ratchet up a notch.

The Recording Academy actively represents the music community on such issues as intellectual property rights, music piracy, archiving and preservation, and censorship concerns. In pursuing its commitment to addressing these and other issues, The Recording Academy undertakes a variety of national initiatives. ArtsWatch is a key part of an agenda aimed at raising public awareness of and support for the rights of artists. To become more involved, visit Advocacy Action @ and sign up for Advocacy Action E-lerts.

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