DON'T SMOKE SECTION 230
Section 230 and its Impact on Creators
Cover Art for ‘2:30’ by Afrobeats artist, ‘Asake’
I sometimes have to remind myself that I’m a lawyer and should probably write more on legal topics. The reality is that the law is slow, trails technology, often stifles innovation; and is simply not as fun to talk/write about as other topics. There’s also a difference between law and ethics. Just because something is legal doesn’t mean it’s ethical, and vice versa.
I wrote a book in 2016 for professional athletes, and one of the things I wrote about is how collegiate athletes aren’t; but should be compensated for their work. Flash forward to 2023, and they still don’t get paid (a salary); and only recently won the “rights” to sign licensing and endorsement deals (under very strict guidelines).
I would go crazy if I was a litigator and had to litigate common sense issues for years at a time.. more power to the litigators.
It’s also a reason why I took a break from practicing music law. It started feeling remedial, and I got tired of doing the same thing and repeatedly negotiating the same points over and over.. on top of that, many artists never cared about doing things differently, and were willing to sign anything for a shot at stardom; and I felt increasingly like a paper weight.
I also wrote a book for artists in 2017, and years later saw music companies being started and funded off insights and concepts that I had years before. I started feeling like the joke was on me, and that maybe I was in the wrong business. Moving into the tech space was a way for me to go upstream and play a part in building innovative systems.
Many times we underestimate how much we know, and think the solution is to know more, when really it’s often just to act and build on what we know and have now.
Section 230
That leads me to this article. Today, I’m going to write about a law most commonly discussed in legal and tech circles; but which greatly effects those in the business of music and media as well. That law is 47 U.S. Code § 230 aka Section 230 of the Communications Decency Act.
The purpose of this act is to provide an opportunity for individuals and organizations to distribute information, content, services and goods; and to decrease the burden on internet-based service providers. In passing this law, “congress knew that the sheer volume of the growing Internet would make it impossible for services to review every users’ speech. When Section 230 was passed in 1996, about 40 million people used the Internet worldwide. By 2019, more than 4 billion people were online, with 3.5 billion of them using social media platforms.
So what does the law say? Section 230, in part, reads: “no provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider”. The term interactive computer service means “any information service, system, or access software provider that provides or enables computer access by multiple users to a computer server, including specifically a service or system that provides access to the Internet and such systems operated or services offered by libraries or educational institutions”.
This article provides a good background on Section 230’s development; but essentially this law means that services like YouTube and Facebook will not be found liable for the content uploaded or published by their users. Now there are, of course, a few exceptions to this rule. This law generally doesn’t apply to federal crimes, sex trafficking, and intellectual property infringement, nor certain state laws. In the case of intellectual property, specifically copyrights, there is a law known as the Digital Millennium Copyright Act which provides a safe harbor for platforms; while allowing rights holders to exercise their rights by having infringing content taken down.
WHERE MY MONEY AT?
In the music business, there’s this thing where music producers often don’t get paid on time. This is contrasted with the tech sector, where payments are structured on Net 30, 45, or 60 pay terms; meaning payment has to be made within a certain amount of days or else the party that failed to pay is in breach of the agreement, which can result in further damages. In the music business, payments are usually structured like this: (i) an initial advance flat fee for the production work done on the song, (ii) sound recording royalties, and (iii) publishing royalties. Many times, producers don’t get the flat advance fee on time and often wait up to a year before they see any payment.
Why?
..because the music industry.
I never really played that, and a quick route to making sure producers got their money on time if a song or album was released without payment was to file a DMCA notice. This usually got the attention of whatever platform uploaded/distributed the producer’s IP (or any other content for that matter) without securing the rights (i.e., via payment). This is because platforms are legally obligated to follow a process where they temporarily take down the content, and notify the publisher of that content that the platform has received this notice. If the platform doesn’t effectively follow this process then they open themselves up to liability. No platform wants that.
So we see that Section 230 doesn’t give platforms carte blanche to ignore the rights of citizens. There are measures in place which promote the protection and remuneration of rights and interests of people and organizations. At its core, Section 230 is meant to be a legal mechanism which promotes economic activity via the internet. This economic activity could happen through a variety of means, whether it’s the jobs created globally from operating internet-based companies, the revenue generated by artists and creators online through direct relationships with their consumers, or the income provided to and by advertisers who place ads on digital sites and media. In all cases, Section 230 incentivizes platforms to “open the gates” to digital information, content, and service providers alike.
INTERNET MONEY
The Interactive Advertising Bureau published a study about the economic impact of the internet and found:
the internet economy grew seven times faster than the total U.S. economy during the past four years, and now accounts for 12 percent of the U.S. gross domestic product (GDP).”
the internet economy’s contribution to the U.S. GDP grew 22 percent per year since 2016, in a national economy that grows between two to three percent per year. In 2020 alone, it contributed $2.45 trillion to the United States’ $21.18 trillion GDP.
since IAB began measuring the economic impact of the internet in 2008, the internet’s contribution to GDP has grown eightfold, from $300 billion to $2.45 trillion.”
podcasting, streaming video, and digital gaming, which barely existed as industry segments when we did our first study in 2008, last year employed 34,000 people and generated more than $40 billion of U.S. revenue from internet-related activities. Digital entertainment companies doubled their employment during the last four years
It goes without saying, but the internet has leveled the playing field by democratizing distribution, allowing up starts to compete with conglomerates. For example, entrepreneurs can stand up e-commerce shops on a variety of websites; media personalities, artists, and influencers can monetize their craft on social media and other sites; allowing many entrepreneurs and companies to become media companies in their own right - and while it also provides an opportunity for spam, fraudulent actors and illegal content; without the internet - many would be unable to commercialize their craft.
The internet is like electricity, the car, the steamboat, or the printing press; it’s just another technology that enables us to be productive - for better or worse.
Ok, so what’s the point?
Well, there has been push back on Section 230 in recent times. Many say that the law wasn’t intended to cover social media platforms; many point to the illicit and illegal content on those sites and say that social media platforms should be held liable; they also point to the algorithmic nature of many social and digital media platforms and say that it’s unfair that these platforms are profiting by using algorithmic technology to target and match individuals with content those individuals are likely to want to watch; yet, those same platforms avail themselves of the protection of Section 230.
Critics are basically saying these platforms are throwing rocks and hiding their hands.
On the other hand, proponents of Section 230 say that if you increase the liability of platforms, and make them liable for the content that their users post then this will lead to a worse user experience, stifle innovation, and hinder economic growth; etc. etc.. and much of this comes down to what’s called the three-prong test of Section 230.
The three-prong test is a test used by Courts when deciding cases involving Section 230, which provides:
the defendant must be a provider or user of an interactive computer service.
the plaintiff's cause of action must view the defendant as the “publisher” or “speaker” of a harmful statement.
the harmful information was provided by another information content provider, other than the defendant.
Let’s focus on the second prong. There’s currently a case in the Supreme Court that illustrate this. The case is Gonzalez v. Google and is being brought on behalf of a group of people who lost their lives to an ISIS attack in France. In this case, the complaints allege that Youtube “allowed ISIS to post videos and other content to communicate the terrorist group's message, to radicalize new recruits, and to generally further its mission”. They also claim that “Google placed paid advertisements in proximity to ISIS-created content and shared the resulting ad revenue with ISIS.”
The Supreme Court will have to answer the question whether Section 230 protects interactive computer services when they make targeted recommendations of information provided by a user. The answer to this question, as in many cases, will turn on the degree to which the Court finds that the Google/Youtube was involved in the creation and development of the content at issue. The particular nuance here that has “everyone” on edge is the implication of Youtube’s algorithm. If this question is answered, it will have a major impact on the internet and digital media; including music and content creators.
I’m doubtful there will be any major decision made, but if there is then it’ll change the nature of content distribution and algorithmic targeting. To what degree? I won’t pretend like I know.. but companies hate liability so it’ll be significant.
NO SMOKE
At the end of the day, I’m all for common sense regulation and even for increasing the monitoring requirements of platforms - particularly where it involves terrorism, violence, sexual harassment and crime, inciting speech; etc., but I also compare this issue to if you contracted with someone to cut your grass and, while you were at work, he started smoking heroin as he cut the grass. It’s not your fault he did this, and you shouldn’t be held liable for his actions.
Now, if you partnered with him to set up a heroin shop in front of your house then you should probably be held liable - and this, in my opinion, is the clarification that will need to come from the rulings on Section 230. To what degree are we considering platforms to be publishers of the content their users upload - and how do algorithms play a part in that determination?
There’s also a role for the market to play, like when it comes to intellectual property.
Diddy recently joked that has to pay Sting $5k a day for sampling his record. Now he later cleaned it up and said he was being “facetious” and probably has to pay more than that. This is because back in the 90’s, Diddy sampled ‘Every Breathe You Take’ by Sting and The Police without their permission. It was reported that he had to give up almost all of the publishing on the record - which resulted in lucrative royalties for Sting.
Over a decade later, the late rapper Juice Wrld, also sampled Sting’s song without permission and had to give up a reported 85% of the publishing portion of ‘Lucid Dreams’. I haven’t found any conclusive proof of a percentage; but here you can see the writer splits of the record (Sting = Matthew Sumner).
Both of these songs went on to sell/stream millions of records and effectively launched careers. The point is, everyone came to an understanding, lots of money was made (except by maybe the producers), and the market was allowed to sort these issues out - without platforms like Youtube and Spotify being held responsible for the initial infringement.
Through the use of copyright law protocols, the appropriate rights holder exercised his rights and came to an agreement with the parties. This means that the system is working effectively in some aspects; and yes, deaths from terrorism is different from sampling records; but this was all meant to make the connection between Section 230 and its’ impact on creators and why a large overhaul would be detrimental.
What’s the take away for artists and creators?
I don’t know, you tell me..
Hopefully this at least showed you that art doesn’t exist in a vacuum. As long as it exists in your mind it’s safe, but once you put it out in the world it has to function in systems, systems that are governed by rules and regulations that only sometimes makes sense. This is why it’s important to understand that everything you do has a business and legal component; and every platform you upload content onto has terms of services and associated laws which govern your media.. you get the drift.
