Mayhem & Chaos Blog

 

Legal/Government

FDA: High fructose Corn Syrup is NOT natural!

Finally the FDA has done one thing right: Foods that contain Corn Syrup cannot be labelled as "Natural":

Products containing high fructose corn syrup cannot be considered 'natural' and should not be labeled as such, the US Food and Drug Administration (FDA) has said.

The decision is likely to cause a massive stir in the food and beverage industry, where a discreet battle has been raging over the status of the controversial sweetener.

Awesome! Anyone even slightly concerned about eating "Naturally" should take note. I hope this will raise awareness to the fact that corn syrup has laced nearly all of the foods you can buy at a regular store. Now I can only hope that manufacturers return to more realistic ingredients like sugar and evaporated cane juice, and not delve deeper into creating another evil sweetener.

 

Music industry watch

Collective licensing is good for music industry, bad for artists

Now that Jim Griffin and Warner Brothers are pushing collective licensing, I feel compelled to re-state my feelings about collective licensing. Let's boil it down to this:

Collective licensing solves a tricky legal problem, but creates an uneven playing field for artists.

At first glance collective licensing seems like a perfect solution. You have ISP's take a little money from users and then give that money to the music industry. Then money should flow to the artists to compensate them for "lost sales" due to P2P traffic. The keyword here is should.

If you go and sue P2P downloaders and get money from them, that money should flow back to the artists, right? Well, that's not happening. The artists haven't received any money from the RIAA & Co -- remember the music industry is full of rat bastards.

But, lets give the "music industry" the benefit of the doubt for a minute. Now consider this uneven playing field:

Record label sources said corporate bosses are still deciding on how best to split the money. In determining the payout, they said not every artist is owed money and it must be calculated with regard to the level of copyright infringement for each artist.

Just how do you intend to measure the infringement to pay artists? Given that the recording industry has proven itself completely incompetent (intentionally or otherwise) I don't trust them to do this right. Figuring out who deserves what turns out to be a hard problem fraught with many perils, unless you simply put the music industry in charge.

From everything I've learned about the music industry, they relish opacity in their accounting. Labels commonly hide behind numbers in obscure contracts which prevents artists easily asserting their fair share. The artists lose this struggle because they have to fight for money tooth and nail (with lawyers and accountants, who cose $$$).

The labels would love to have a spout of money turned on and poured directly into their opaque accounting cash cow. Little if any money would ever come out and then only the big artists sucking up to their labels will see any cash. The rest gets squat.

This makes life for indies harder and harder -- unsigned artists get infringed on just like signed artists, yet with this system the indies would never see any cash. Collective licensing could put the big labels back on top with an ever firmer grip on the music industry -- it would have the cash to squash the edgy Internet labels and Music 2.0 companies. The quality of music would continue to go down and the prices would still be kept high.

Ugh. No thanks. Please let the free enterprise and our legal system figure out the best approach! I feel that we're getting close to striking a realistic balance between the needs of fans, artists and the labels.

Say no to collective licensing!

 

Non profits

Working business models are a must!

While lots of my friends from the valley scoff at my conservative "income has to match or exceed expenses" approach to running a non-profit, I'd like to think there is some basic sense in adhering to the laws of business.

Case in point Divx recently shut down Stage6:

So why are we shutting the service down? Well, the short answer is that the continued operation of Stage6 is a very expensive enterprise that requires an enormous amount of attention and resources that we are not in a position to continue to provide.

While filling a need or building a cool site on the net is fun, the laws on the Internet apply to everyone: Success is expensive! Building a cool site like Stage6 may fill a need on the net. But if you don't have the business model to support your service, success will kill it. This sounds totally counter-intuitive, but hosting tons of traffic on the net isn't cheap -- especially if you're serving tons of video! Its important to have income match your traffic -- if you cannot derive cash from traffic, you're going to die. Its really that simple.

Wikipedia is in the news again, for the same reason:

"Imagine if the other top 10 websites in the world, like Yahoo or Google, tried to run their budgets by asking for donations from 14-year olds," said Chad Horohoe, a 19-year-old college student in Richmond, Va., who was until recently a Wikipedia site administrator, one of the 1,500 or so people authorized to delete pages or block users from making changes to articles. "It isn't sustainable."

Sad, but very true. A few years ago I had hoped that donations could help artists/musicians/hackers etc, but I think I'm finally done with that notion. People aren't willing to open up their wallets enough to really make anything serious happen. Hosting a site with donations? Yes. Paying a paycheck: Not bloody likely.

Case in point: MetaBrainz took in 16.5% ($14,780.59) of total income in end-user donations in 2007. Our hosting expenses were 13.6% ($12,240). But paying out one meager salary (at about 1/3 of market value) was 44% ($39,500). Our donations were not even close to covering that cost.

The moral of the story: You need a business model that works. Especially so, if you're in the non-profit sector since the "sell out to Google" model doesn't work. So, Wikipedia, find a model to license your pages for commercial use -- do it now!

Call me if you want me to pop in sometime and share my thoughts with you. :)

 

Music industry watch

Seth Godin talks about the music industry

Seth Godin wrote up a transcript for a talk he recently gave -- I wish I could've been there to listen to it. While its not as ground breaking as David Byrne's writings, it captures the essence of the music industry today:

... when the typical person is a teenager, they’re spending a lot of time looking for more. “What’s the new thing, what’s the next thing, what’s the new thing?” But these guys don’t want that. They want to remember THEN, they don’t go looking for the new thing. And, it’s not your fault they were baby boomers, it’s not your fault the baby boomers are getting old.

At the excellent San Fran Music Tech Summit last week had a panel with a guy who worked on the original Napster. This guy now works for a music label and was totally surprised by the fact that teenagers stopped buying CDs. Its clear to me that the labels are blind not only to technology, but to general trends in their customer base. Having a marketing person like Seth Godin chime in rounds out what the Internet has been saying about labels for quite some time.