Last week we ran a piece about the ongoing battles between King Crimson and Grooveshark. If you missed it, the upshot is that King Crimson have been struggling for months to get their songs taken down from Grooveshark, and apparently making little headway, so much so that the band provided email transcripts of their dealings with Grooveshark to industry website Digital Music News. After we published the piece, Grooveshark VP of Business Development Paul Geller contacted us and asked to present his side of the story. We figured this was only fair, and spoke to him earlier this week — we’ve published the transcript of our interview verbatim after the jump, and invite readers to draw their own conclusions. As we hope you’ll agree, it makes for very interesting reading.
Flavorpill: OK, so we wanted to get your perspective on the King Crimson issues. You said in an email to Digital Music News that [King Crimson guitarist] Robert Fripp had “doctored the conversation.” What do you mean by that?
Paul Geller: Well, I think the whole story wasn’t told. For sure we’re complying with every law that we know of here in the US in terms of getting people’s work off the site that they don’t want there, and it’s really just a simple process. By clicking a single link and filling out a form, anyone in the world can get their music off Grooveshark. If you don’t want to participate in that, it’s really much harder to help someone. That’s the only time we hit trouble with artists, when they don’t want to participate in the laws that are already on the books here.
So you’re saying that King Crimson could have used a single link, and they didn’t, and that’s why their music was on the site?
Well, yeah. It’s really that simple. Any artist can come in and submit a DMCA takedown notice, and it usually takes a little bit less than 24 hours. We say 24 hours, but it could be minutes.
But how do you ensure that the music doesn’t go straight back up again?
We can’t ensure that. Basically, labels, managers, artists, fans are using the platform all the time. But one of the things we’ve put into place is a one-strike policy with uploaders, so if an uploader is accused by a content owner of uploading a track they didn’t have the rights to, and a content owner submits a DMCA takedown notice, then we disable the uploading privileges to that account. So I imagine that even in a short time, with King Crimson, the people that were adamant about uploading that no longer have any access to uploading whatsoever. With many services that have multiple attempts, I could see how that’d be very demanding, or at least sort of demanding, but for us, this one-strike policy really mitigates the possibility that those tracks will continue to appear.
I had a look at the site just before we spoke, and there’s three King Crimson tracks there right now. You can understand bands’ frustrations if they’ve asked repeatedly for tracks to be taken down, and people continue to upload them. Can you not do something at your end to just blacklist an artist to ensure that if someone uploads that artist’s tracks, they don’t appear on the site in the first place?
Our ambition is to be the best actors in the marketplace in terms of compliance with the law. Unfortunately, that [approach] doesn’t scale — it’s much easier for a rights holder to know what they own than it is for us. We can’t possibly know if there’s a remix, or a white label, or a live recording, or the publisher owns something, or there’s a recording in a different territory… the licensing situation throughout the world is extremely complex. We’ve made the process as simple as possible for rights holders to complain and get [their property] off the site as quickly as possible. The last thing we want is people uploading content that they don’t have the rights to. We want to make sure every rights holder has the opportunity to keep that from happening, and to have recourse as quickly as possible.
But isn’t that a fundamental problem with how your site works? Because there’s a public uploading process, there’s always going to be stuff up there that you don’t have rights to.
I don’t believe so. I point to similar user content-generated sites… I look at Twitter, and Facebook, and YouTube, all of these places where the platform is open for people of all shapes and sizes all over the world to use however they want to, and I think the benefit of having an open platform outweighs the very, very small… well, I should say, the problems that you have with that platform.
What are the benefits to you of having a public uploading system? Is it that you don’t need to pay licensing fees to labels up front? [The model used by Spotify, Mog, etc.]
No, absolutely not. The reality is that by being a public system, we don’t control what is happening on the system outside the user experience. It makes it so that artists can do whatever they like. They don’t have to go through a gatekeeper, they don’t have to sign a contract… They can literally distribute their music across the world for the first time ever without any restrictions on that. I think it’s important for the music ecosystem, and I think the data shows that what’s happening on sites like YouTube and Grooveshark is important for [that] ecosystem. The artist ecosystem has expanded exponentially in the last decade — there’s more music being made by more people being made available to more people across the world, and I think Grooveshark is a good actor in that sense. And I think our best-of-breed compliance with the DMCA lends credence to that.
But how do artists actually make money out of Grooveshark? If I’m an artist and my track gets played, do I get paid?
There are four ways that artists make money out of Grooveshark. The first way is through licensing. Any artist can come into our system, via a label, or an aggregator… we have deals with many, many labels and aggregators — tons and tons of independent labels, and tens of thousands of independent artists, and that’s going to expand rapidly. They either get paid through their label, or through their representative, whoever has control of their catalogue on Grooveshark, and they’ll get a percentage of revenue. So however well we do on the advertising front, or on a subscription front, that revenue is shared pro rata.
Wait, does that mean if you’re not making revenue artists don’t get paid?
I’m really glad you asked that. I think this is the best part of our service, and I think I understand your question … are you asking whether if [artists] are not getting paid pro rata if there are other ways [to be paid], or are you asking if Grooveshark were to not have advertising [and make money], whether artists would get paid?
OK, so the reality is that if Grooveshark were not to make any money off of advertising, artists’ payments would decline in the same way.
So you don’t pay a license fee irrespective of your revenues?
I can’t answer a question about particular agreements, but that’s our standard agreement, and that’s what labels large and small have been found to be most beneficial. That way we’re both invested in each other’s success.
I also want to ask about the accusations from a commenter on the Digital Music News article, claiming to be a Grooveshark employee. You categorically deny everything he/she said?
Yes. Grooveshark employees do not upload content unless it has been delivered to us on a hard disk, and it’s part of a contract that we’re supposed to take care of that ingestion process.
Right. So you’re saying that the only things that get uploaded internally are things that have been provided by labels?
In terms of [being uploaded by] our own employees?
OK, yes, that’s correct. The material’s not necessarily provided by a label — it’s provided by the rights holder. That could be an authorized manager, an artist representative, or anything like that. But these things generally come on a gigantic hard drive full of metadata from rights holders overseas or something.
Are you worried that you’ll eventually get taken down by one of the three major labels who you don’t have a licensing agreement with?
I think that the licensing aspect is extremely complex, and I think that as major labels learn a lot more about doing business and the alternative revenue streams that we’re creating for artists and rights holders, I have faith that very, very shortly that the vast majority will see the numbers, and the numbers will work for them, and they’ll appreciate the service that we’ve been creating. So I don’t worry about that.