In a non-precedential summary order on December 19, the Second Circuit affirmed a decision interpreting the BMI consent decree, which governs Broadcast Music International, a performance rights organization (“PRO”) that gathers music rights together to be packaged in a single blanket license. The details of the music battle and its implications are discussed in my previous posts [1, 2, 3, 4]. The affirmance means that BMI can not only fractionally license, it can do so under the consent decree as it is currently drafted. This decision will be terrible for the music industry, enabling new forms of market power that could be abused by license holders to increase prices.
Less than a week after agreeing to pay $1.75 million to the Department of Justice to settle an investigation into antitrust misconduct, the American Society of Composers, Authors and Publishers (ASCAP) was on Capitol Hill yesterday, asking lawmakers to roll back the consent decree to which the performing rights organization is bound.
On May 12, DOJ had asked a federal court to hold ASCAP in contempt, stating that the PRO had “undermined a critical protection of competition” and violated its federal commitments. Concurrently, DOJ and ASCAP filed a settlement relating to the alleged misconduct.
As DisCo has previously covered, two federal courts found “troubling coordination” among ostensible competitors in the music publishing industry, which contributed to Justice’s recently concluded investigation. The 7-figure settlement is a stark reminder of the continuing need for antitrust protections, even as Congress is being asked to relax those commitments.
The cross-border nature of the Internet disrupts the traditional notion of geographically defined national jurisdictions. Increasingly, contradicting privacy laws confuse consumers and force international companies to violate one country’s law in order to comply with another’s.
Three high profile cases have privacy experts, and all the rest of us, really confused:
Case one: The European Parliament vs The U.S. Foreign Intelligence Surveillance Act (FISA)
The European Union is in its final stretch of agreeing a reformed data protection framework. In the frenzy following the Snowden revelations, the European Parliament (EP) looked for ways to force the U.S. Government to reform its surveillance practices. One means for doing so is a well-intended article in the proposed EU general data protection regulation, which is popularly known as the “anti-FISA clause.” This provision, Article 43a, would severely limit the circumstances under which a company is allowed to provide third country authorities with Europeans’ data. Today, companies are often asked to respond to requests for data to be used in a criminal investigation or by a regulatory authority acting in the public interest, e.g., from third countries’ consumer and environmental agencies. As EU negotiators are about to conclude the data protection regulation, it is becoming evident that the EP’s proposal would place companies in legal limbo due to contradictory EU and U.S. laws.
Yesterday Billboard wrote that the Department of Justice was reportedly taking a position against a major source of gridlock in music licensing: so-called “fractional licensing.”
As readers of DisCo may recall, the Department of Justice has been investigating alleged anticompetitive activities by the nation’s performance rights organizations (PROs). Two of the major PROs, ASCAP and BMI, are already governed by long-standing consent decrees originating from previous antitrust cases. In the course of efforts to update those consent decrees, DOJ has reportedly said that it will look disfavorably on contractual terms that gridlock musical compositions.
This is a crucial development, because gridlock is one of the greatest impediments to more viable options for music delivery, and, one federal judge has already found, has been used anticompetitively in an effort to extract supra-competitive prices.MORE »
After the search giant announced its intention to buy ITA Software in 2010, everything seemed so clear: Google would exploit its control over the ITA tools that power other online travel agencies as well as many of the airlines’ own sites to usher competing search services off the stage, then jack up ad rates for travel queries and favor flights from particular airlines.
A Nov. 2010 video by FairSearch, a group of companies opposed to the purchase, spelled it out in under five minutes: Google “will have leverage over the entire online travel industry,” “will control who gets to use ITA,” and “will control which flight options consumers can see first.”
Former airline executive David Grossman wrote in USA Today of a further fear: “Google could redirect air travelers to its own travel pricing and booking engine.” And at the Washington Post, my old colleague Steven Pearlstein–one of the smarter, saner observers of economic policy I’ve known–called the deal a blatant attempt by Google to “delay or prevent that next round of creative destruction.”
More than two and a half years have passed since the Department of Justice approved the purchase–subject to conditions including formal commitments by Google to extend current ITA customers’ contracts into 2016–and Google closed its acquisition of the Cambridge, Mass., firm. How’s Google’s ITA-powered flight search doing?
“Barely off the runway” comes to mind. Experian Marketing Services‘ April 2012 data, based on a survey of 10 million U.S. users, doesn’t have Google Flight Search anywhere near the top 10 travel-search sites–which it defines broadly enough to include Google Maps in first place, with 16.63 percent of site visits. It’s not in the top 100 or even the top 200. Rather, it’s in 244th place, just behind Hipmunk, with .04 percent of the market.