Tonight I helped someone buy some chickens

After ranting about the RED project the other week, it's great to be able to point to a project that's doing something really positive for the Third World without giving kickbacks to shareholders or boosting rock star egos in the process. Kiva is a social networking site that brings people together to fund entrepreneurs in the Third World. Each member can contribute as little as $25 and once the total loan amount is raised Kiva pools the contributions and sends the total to the entrepreneur.

Journal entries at Kiva keep lenders up to date with the entrepreneur's progress and the loan is paid back over 6-18 months. At that point lenders can withdraw their money or re-loan it to someone else.

In a little over a year, Kiva's 35,000 members have lent $2.6m and, to date, the repayment rate is 100 per cent. Kiva is also the first website to have PayPal fees waived.

I think this is a great idea. Tonight, along with three others, I helped Ejidia Nyambura Muragu, from Muranga in Kenya, buy some chickens and got together with 12 others to help Monica Theobald, of Dar es Salaam, Tanzania, raise working capital for her grocery store. Monica's lenders come from across the United States and from Australia, Belgium, Denmark and, of course, London.

Right, I'm off to get some pink sunglasses and await my turn to edit The Independent.

Squande(RED)?

I'm not a big fan of Bono or his ego-charity RED and I've said as much elsewhere. American industry magazine Advertising Age angered the charity recently by claiming that RED had raised just $18m since launch although companies have spent $100m marketing it. RED responded by saying the article was mistaken, putting the figure raised at $25m and the marketing spend at around $30m. The charity said the amount raised was five times that of the previous four years put together.

Even so, Popbitch last week had a lot of interesting numbers about Bono, who does a lot of work for charidee but doesn't like and loves to talk about it:

  • Bono doesn't invest his own money in RED
  • The $389m U2 made on their last tour was funnelled through companies mostly registered in Ireland and structured to minimise taxes
  • U2 moved its music publishing company to the Netherlands from Ireland in June last year, six months before Ireland ended a tax exemption on musicians' royalty income
  • Richard Murphy, adviser to the Tax Justice Group, said: "This is somebody who's exceptionally rich taking the opportunity to shift his tax burden to somebody else but then asking Government's around the world to spend that tax in the way that he would like."

Indeed. Just to recap: Bono wants to minimise the amount of tax he pays. That's his privilege and many people would do the same in his position. However, he then wants to call on governments to spend the tax money they've collected on projects that suit him. That's hypocrisy.

Having maximised his private income, Bono then uses precisely none of it to finance Project RED.

As pointed out above, RED has done some good. The $25m raised will hopefully make a difference to suffering people. However, the companies involved in RED have undoubtedly made far more money than they have given to charity.

When Motorola launched their RED phone, Ron Garriques, the president of Motorola mobile devices, said the plan was to use the charity to reduce customer "churn". They aim to produce one RED product every quarter.

I know this is obvious. These companies want to make money and if they generate a little for charity on the way, surely that's a good thing? Isn't it better than nothing?

Perhaps, but the alternative isn't nothing. And I'm irritated by the moronic ads, the fatuous celebrity endorsements and the reduction of a major global issue to a simple transaction. I'm annoyed by the prostitution of media companies - first the Independent and soon Vanity Fair - and the exclusion of Africans from this debate in favour of rich, white men.

RED is cynical, patronising and empty. Couldn't we all just Buy Less Crap?

[Hat tip to my wife's favourite blog: Carlagirl]

Gowers upsets record labels

Andrew Gowers, the former editor of the Financial Times, delivered his Review of Intellectual Property today and while it could have been better for digital rights campaigners, there are certainly some positive recommendations. However, they are only recommendations, so the Government may decide to ignore them. A few weeks back I wrote about the record industry's campaign to have the copyright term on recordings extended from 50 years to 95 years. Today, Gowers recommended that the term stay at 50 years. The record industry are undeterred, however. Even before the Gowers Review was released, they had begun their campaign to persuade the Government to ignore him.

Digital rights guru Lawrence Lessig is pleased that Gowers recommended against retrospective copyright extensions. He writes: "Bravo. Now if only the British (and every) government could muster the courage to follow this advice."

He doesn't sound too confident. If the Government doesn't rule out retrospective extensions, we'll have this debate again in 2012 when The Beatles recordings begin to come out of copyright. That's if the record labels can keep their greedy mouths shut for that long.

Gowers also argues for a change in the law to permit copying for personal use. This is good news but really it's just common sense. If you buy a CD, why shouldn't you be allowed to copy it to your MP3 player?

However, there are other recommendations that cause concern. The review calls for stronger enforcement of IP rights through, among other things, tougher penalties including up to ten years in jail "online copyright infringement". As the Open Rights Group makes clear in their overview, Gowers appears "to make no distinction between large-scale commercial counterfeiting and small-scale non-commercial acts carried out by individuals".

Kevin Marks goes further on his blog and says that Gowers uses rhetoric that actively reinforces the idea the commercial counterfeiting and personal downloading are equal offences.

Finally, the always thought-provoking Techdirt argues that the review is too balanced. This isn't a balanced fight where "what one side gives up, the other gains", instead everyone needs to "rethink how they view the space".

Overall though, the Gowers Review is positive. Let's hope the Government follows his recommendations.

Release The Music

The Open Rights Group has set up a website, Release The Music, to campaign against the attempt by the record industry to extend the copyright period on sound recordings. I've been blogging about this issue for the last couple of days but the ORG site has a briefing that covers some things I haven't mentioned. They begin with a great statement of the case:

Copyright is a bargain. In exchange for releasing sound recordings to the public, copyright holders are granted a limited monopoly during which they can pursue anyone who uses their recordings without permission. But when this time is up, these works join Shakespeare, Shelley and Bernard Shaw in the proper place for all human culture ? the public domain.

The public domain is about to benefit from its half of this bargain, as tracks from a golden age of recorded sound reach the end of their copyright term. Seminal soul, reggae and rock and roll recordings will soon be freed from legal restrictions, allowing anyone to preserve, reissue and remix them.

The ORG briefing goes on to point out that the music industry has offered no evidence to support its claim:

In 2005, the Royal Society of Arts sponsored an international commission of experts from the creative industries, law, economics, science, technology and the public sector to produce The Adelphi Charter, a framework for policy makers who are considering changing their IP legislation. The Charter urges governments to automatically presume against extending the scope or term of IPRs, stating that ?the burden of proof in such cases must lie on the advocates of change?, who should provide rigorous analysis which clearly demonstrates that any extension would be in the economic and civil interest of the public at large.

But despite this clear guidance, those asking the government to extend the length of copyright term for sound recordings have published no compelling evidence or analysis. Instead, the arguments they have presented to the Gowers Review collapse under even passing scrutiny.

Major labels argue that revenues from copyrighted recordings allow them to take risks with new artists but, as the ORG briefing demonstrates, it isn't the major labels who are doing the innovating:

Three of the seven debuts from the best-selling albums chart mentioned by the BPI were nurtured by independent labels who had existed for less than twenty years between them, i.e. 43% of successful debuts came from labels within that 15% market share. And a 17-year-old record label, Warp Records, won this year’s Digital Music Awards for their music store, bleep.com. None of these innovative companies has ancient back catalogue earnings to rely upon when finding money to invest in new ventures, and none of them will benefit from extending the term on sound recordings.

Next the briefing skewers the claim that royalties from past works serve as a pension for washed-up rock stars. As the ORG points out, 80 per cent of recordings do not earn any royalties for the artist - it's part of the ingenious way that the record industry screws artists. So what about the other 20 per cent?

Industry revenue figures are shrouded in secrecy, but some evidence on the 20 per cent of artists who do earn royalties can be found. For example, out of 15,500 artists surveyed for the Monopoly and Mergers Commission in 1996, only 16.5 per cent were likely to earn more than £1,000 that year in royalties, with under 2 per cent earning more than £20,000. Bear in mind that these figures did not specify how many of these royalty payments were for tracks recorded over fifty years ago: it seems safe to assume that these would make up only a tiny fraction of total royalty revenues.

So why does Sir Cliff Richard, a high profile campaigner for term extension, characterise sound recording royalties as a ?pension for artists?? What figures are available show that extension would be of help only to Sir Cliff and a tiny number of other already highly successful artists.

So copyright extensions won't help artists and, the briefing goes on to explain, they won't help fans either. A recording is far more likely to be made available to the public once it falls out of copyright:

A survey by Tim Brooks on reissues of pre-1945 sound recordings across the US (where they are still protected by copyright) and the EU (where they’re not) showed that for every five-year period, non-rightsholders have issued more historical recordings than rightsholders at a ratio of close to two to one.

And copyright extensions will make it harder to preserve our culture:

As well as being economically illogical, extending the term on sound recordings would also privatise and could even destroy vast swathes of British cultural heritage. Because of the inadequacy of existing provisions in copyright law, the British Library Sound Archive, one of the largest such archives in the world, is unable to digitise sound recordings still under copyright without seeking individual permissions from existing rightsholders. Although digitisation is important for preservation, the size of the sound archive and the cost of clearing the rights means that such a process is too expensive for the majority of recordings. So digitisation is put on hold, endangering the education, inspiration and enjoyment of future generations.

It's worth reading the whole thing. It's a very compelling argument against giving in to a few greedy major labels.