Net Neutrality and the Music Ecosystem: Defending the Last Mile

Last week, the musician Phil Elverum, a.k.a. Mount Eerie, celebrated the fact that his album A Crow Looked at Me had been ranked #3 on the New York Times‘ Best of 2017 list. You might expect that high praise from the prestigious newspaper would result in a significant spike in album sales. In a tweet, Elverum divulged that since making the list, he’d sold…six. Six copies.

Making a living is tough for the vast majority of musicians today—no, not just tough: it’s absurd, discouraging, and unsustainable. According to an RIAA report, CD and digital download sales continued to plummet in 2016 while online music streaming was up, up, up. And yet, despite some overall improvement, the RIAA noted that “revenues [were] still only about half what they were in 1999….” One big reason for this are the paltry royalties paid by those online streaming services. A study by Information Is Beautiful released in July 2017 showed that the highest-paying online platform, Napster, paid out $0.0167 per play to unsigned artists. In other words, 1,000 plays of a song equals a gross earnings of $1.67. As Old 97’s lead singer Rhett Miller wrote recently in The Baffler, the rates negotiated between these services and major labels has resulted in “such minuscule sums that you would lose money by burning the gas it would require to drive to the bank to deposit the check in your account.”

It looks like things are about to get worse. Tomorrow, under the leadership of its Trump-appointed commissioner (and former Verizon lawyer) Ajit Pai, the Federal Communications Commission will vote on and likely approve new rules that will end net neutrality.

If approved, the plan outlined in “Restoring Internet Freedom” will lift the ban on “paid prioritization”. Internet service providers (ISPs) like Verizon, Comcast, and AT&T will be allowed (and incentivized) to charge higher fees for prioritized traffic, i.e., “fast lanes”. Large businesses like Google, Facebook, and Netflix will be able to afford the increased ISP rates, but they’ll likely pass those additional costs down to the rest of us. Even if you pay for the highest-speed connection you can afford, certain content may still reach you more slowly than other content depending on where it’s coming from. There’s every reason to believe that the ISPs will make it less convenient for you to access their competitors’ products. And even if you have faith in the CEOs when they promise not to throttle or block sites (which, under the rules, they’ll be allowed to do so long as they disclose it “transparently”), the end result will be throttling on a macro-level: the internet as a caste system.

While this is bad news for middle- and low-income consumers, it’s even worse news for independent creators, including writers, animators, visual artists, filmmakers, game designers, and of course, musicians. Those without deep pockets or backing from media giants will find it more difficult to be heard, which means artists with new ideas and radical perspectives who create non-commercial work will find it even harder to make a living. Poorer economic conditions stifle the possibilities inherent in any art form. It is absolutely essential that we guard the last mile of the internet’s democratic potential from total corporate takeover.

To gauge the effects of the current FCC proposal on musicians, I recently corresponded with Kevin Erickson, National Organizing Director for the Washington D.C.-based nonprofit Future of Music Coalition. Since 2000, FMC has advocated for musicians in public policy matters like healthcare, copyright laws, artist compensation, and the internet. As you’d expect, FMC has energetically campaigned for net neutrality. In a statement released yesterday and co-organized by CASH Music and Future of Music Coalition, numerous musicians and record labels like Neko Case, R.E.M., Killer Mike, Bloodshot Records and Sub Pop voiced their support for net neutrality. You can read the full statement here.

I want to get into the details of the current FCC proposal and how it’ll affect musicians, but first I’d like to step back and put things into some historical context. I’m guessing a lot of people, especially non-techies like myself, were first exposed to the concept of net neutrality when Comcast was accused of blocking BitTorrent traffic in 2007. That same year, the Future of Music Coalition established the Rock the Net campaign for net neutrality. How would you compare the situation musicians faced then, in 2007, to the situation they might face today if the FCC proposal to eliminate net neutrality is approved?

We launched that campaign in 2007, but we as an organization were looking at these issues even earlier—even before Tim Wu coined the term “network neutrality”. It’s funny to see how much the internet and the way we talk about it has changed since then. (Even the phrase “the net” just makes me think of Sandra Bullock now.) But I think when the history books get written about this era, they’ll show that the music community recognized the potential impacts and were strong leaders. That’s because musicians have so much experience dealing with non-neutral communications systems and have been witnessing what happens when large corporations use their gatekeeper powers—in terms of both free expression and fair competition and compensation—long before the issue became part of the political mainstream.

You’re right that the task in the earlier stages of the debate was to broadly educate policy members and the public about how this would impact the music community and society more broadly—to make it clear what was at stake. We have a different task now, in that millions of citizens have spoken up on the issue and the overwhelming majority of unique comments are supportive of net neutrality, but the leadership at the FCC seems poised to ignore overwhelming public opinion. We have been remarkably successful in getting this complicated technical issue on the radar and now we’ve got to hold government decision-makers accountable.

And crucially, we’ve got to draw some connections between net neutrality and other media and communications policy issues. When we talk about “music for a healthy internet”, net neutrality ultimately is fundamental and necessary, but it’s also just one piece of the puzzle.

I thought Devin Coldewey at TechCrunch made a good point earlier this year when he wrote that the ISPs’ rationale for being re-labeled an “information service”, which is defined in part as “generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications”, is “like saying that because someone built a bridge, they also created the entire city and all its resources on far side of it.” To me this rationale is another instance in the long history of corporations asserting at least shared ownership of creative content, and in the process, devaluing actual creators, like musicians. Is that too far-fetched?

That’s an interesting observation! I don’t think the ISPs are claiming any interest in the ownership of content in this specific context, but just trying to define their role in the way that allows them to avoid any regulatory oversight. It strikes me as more of a self-serving technological argument rather than a self-serving philosophical argument, if that distinction makes sense?

We share an interest, I think, in music as potential made real. FMC tweeted the other day that “[m]usicians are in the business of expanding our sense of what’s possible. As Brian Eno said: ‘what becomes possible in art becomes thinkable in life.'” What is the connection between net neutrality and this potential?

It’s easy to fall into the trap of talking about music primarily in terms of its position in our economic life—as fundamentally centered on celebrity, entertainment, and commerce. And certainly, we do care about the business of making music, because a sustainable economic framework for cultural production is necessary for the entire endeavor to continue.

But on some fundamental level, what motivates people to make music is often bigger. Our friend [Fugazi frontman] Ian MacKaye is fond of pointing out that music is a form of communication that predates language. It’s a vehicle for galvanizing communities, identifying and addressing and elevating those communities’ specific concerns, voices, or sensibilities. It’s a social space where individuals find a sense of cultural identity and belonging, where bigotries can be confronted and differences can be bridged.

This is a moment in American politics when freedom of expression faces some novel threats, when it seems like many of our systems have failed us. Simultaneously, it’s a moment when the imaginative possibilities uniquely offered by music are especially desperately needed.

Let’s get into some of the details of how FCC Chairman Ajit Pai’s proposal will affect the music ecosystem. Paid prioritization seems like it will have an obvious effect on music streaming services, which are only getting more popular. The RIAA reported that in 2016, streaming accounted for 51 percent of the industry’s revenue. How would ending net neutrality affect musicians’ ability to make money from their music being streamed online?

We’ve already seen the beginnings of zero-rating style schemes on wireless and that could give us some indication of what the future holds. Right now, if you’re an independent label or musician who prefers Bandcamp’s flexible pricing model over Spotify’s more one-size-fits-all schema, you have some degree of choice and agency about how to bring your work to the marketplace. Well, if an ISP makes a sweetheart deal with a particular favored service, they’re making those sorts of choices on your behalf.

The current streaming models have a long way to go toward better meeting the needs of artists and fans, but the loss of net neutrality could mean that these services, which should be competing to better serve musicians and listeners, will instead compete to better serve the needs of ISPs.

And if services do end up having to pay for prioritization, they’re likely to pass those costs on to creators in the form of lower royalty rates.

How would the elimination of net neutrality affect musicians’ careers in other ways, such as touring, publishing, or licensing?

So much of how musicians do their everyday business relies on the internet and the seamless flow of information between different parties. From booking shows and selling tickets to merchandising, creating innovative new tools and models, and nondiscrimination, neutrality is what makes it all possible.

In the comments that Future of Music Coalition submitted to the FCC alongside other arts advocacy organizations in August of this year, you write that you support a “legitimate digital marketplace”. How would ending net neutrality affect the protection of copyright and intellectual property?

Copyright and net neutrality issues aren’t directly linked, and it’s fair to say that net neutrality advocates include both people who are deeply frustrated with unauthorized copies of their work appearing online and people for whom that hasn’t been a core concern. The 2015 net neutrality order that we’re defending only applies to lawful data—despite ISPs trying to get people riled up by saying that it’s a pretext for piracy.

All that said, I think there’s an important connection between the two in that to build businesses and systems that respect creative labor and treat artists fairly (and fans, too), creators have to have leverage. When ISPs can make money by standing in between creators and their audiences, that’s leverage that’s lost, and it’s a threat to creative autonomy.

I’m also wondering about the effects of this proposal on small labels, the truly independent labels that aren’t owned or distributed by the majors. How will they be affected?

Inevitably, smaller scale entities that serve specific niches and communities—whether based on genre, geography, or other factors—have the most to potentially lose, because they are among the least likely to be creating work that gains the favor of corporate partners with the means to strike favorable deals with ISPs. These labels are responsible for bringing so much creativity and diversity of expression to the world, and this is why we’ve seen so many independent labels—from influential long-running labels like Bloodshot, Sub Pop, Merge, and Kill Rock Stars, to tiny upstarts that mostly release small runs of cassettes—come out swinging in defense of strong net neutrality protections. The American Association of Independent Music (A2IM), the trade group that represents independent labels in the US, has weighed in, as well.

What about the major labels and the musicians they’ve signed—or have yet to sign? It’s tempting to think of the Big Three as being immune to all of this, but they’ll almost certainly have to shell out big sums for paid prioritization. Do you think they’ll be more conservative in their decision-making? And do you think musicians might be more tempted to sign 360˚ deals where they cede more control to a big label that can afford the necessary capital?

Big picture, it’s certainly true that the ability to reach fans directly and on an artist’s own terms has given artists a stronger negotiating position with the whole range of potential partners they may consider working with, including major labels. Labels still can fulfill very important roles in developing artists’ careers, but if we lose the level playing field provided by the open internet, it’s definitely possible that artists could be presented with less favorable contractual terms as part of the cost of getting past a new layer of gatekeepers.

One more angle on the music business: media coverage. There’s been this so-called “pivot to video” in online media, which, aside from whatever horrible effect it’s going to have on music journalism, seems to be happening at the absolute wrong time. If websites have to pay more to fluidly stream that video, isn’t it possible they’ll tighten up their coverage?

Yes, there is a risk that already cash-strapped media outlets will have to raid editorial budgets to pay ISPs and certainly music press is vulnerable here, at a time when so many alt-weeklies and other trusted local sources are already going under. There’s a parallel concern already with outlets having to pay for Facebook boosts and the like now that “organic reach” has been badly degraded. So imagine that same dynamic at the ISP level and you can start to understand what’s at stake.

There’s a new report from Stanford that suggests that local coverage is particularly at risk.

Net neutrality doesn’t operate in a vacuum, as FMC and other organizations, including civil rights organizations, have pointed out. What would the end of net neutrality look like in the context of, for instance, the tax reform bill that Senate Republicans just passed?

The tax reform bill contains a number of provisions that are worrisome. Chief among my concerns is the elimination of the ACA mandate, which is crucial to making Obamacare work. The bill would discourage charitable giving, which would affect non-profits that help musicians. Net neutrality is, of course, crucial to our ability to get the word out about potentially destructive policies, and for communities to organize, educate, and resist.

It seems likely that the FCC will approve Chairman Pai’s proposal. If that happens, what’s the next step for organizations like yours?

If the FCC does move forward, as it’s likely to do on a 3-to-2 vote, it’s absolutely certain to be challenged in court. And Pai’s proposed repeal order isn’t exactly an airtight legal case. At the same time, it will be important to pressure Congress and tell them not to accept any net neutrality “compromise” that abandons the bright line protections we need against blocking, throttling, and paid prioritization.

It’s going to be extremely important for us not to be too discouraged. Policy change takes time and you often have to lose a few times before you win. Remember, we had to lose in court before we got the strong net neutrality rules that were won in 2015. We’ve accomplished so much—and the early leadership of musicians and independent labels is a lot of the reason why. More people know about this issue than ever before and our movement is stronger and more diverse than ever. We’re not giving up.

To our readers in North America: If you would like to voice your opinion on net neutrality before the FCC’s vote on Thursday, 14 December 2017, call Congress and say “don’t let the FCC roll back net neutrality protections”. The Capitol switchboard number is 202.224.3121.