Levine’s book is a story of the digital copyright wars.

“I tried to write in an analytical way about something people get very emotional about. I don’t really believe the entertainment industry is good and the technology industry is bad; I just don’t see it as a morality issue. Businesses are in business to make money,” Levine says.

The book details the calamitous decisions made by the music business, particularly in its suing of end users for infringement. “In a few years,” he writes, “the major labels managed to destroy the cultural cachet they had spent decades building.”

The book also follows in detail Google’s “war on copyright” and the academics and activists who benefit from it. It comprehensively demolishes the arguments put by Lawrence Lessig, who helped create the cyberlaw industry. This is a book with masses of solid, meticulously researched detail.

I caught up with Levine in Berlin.

Q: What do you see as the culture industries’ biggest mistakes? You focus a lot on music …

Levine: The music industry made a lot of mistakes. They could have launched an iTunes store. And suing individuals was a mistake. I don’t think there’s anything wrong with companies suing companies: Napster, or Grokster for example. But suing people created publicity so bad that it made it very hard to get a legislative solution. It was a complete disaster.

But you have to remember that there’s a lot of things that aren’t legally or financially practical for an incumbent to do. You have a game theory-type problem: the establishment player has a lot to lose and has to play by the rules. A startup doesn’t have to.

People say they should have worked with Napster. But the labels would have been trading quarters for dimes, and they didn’t even know those dimes would be worth 10 cents. It assumes Napster would have worked out as a business.

I also think labels should have cut CD prices faster. But did you know Universal Music cut CD prices 25 per cent in 2002, and sold 13 per cent more CDs. You lose money that way; we’ve seen that again and again. We’ve seen iTunes raise the price of the best-selling songs from 99 cents to £1.20 and make more money. People aren’t price-sensitive as much as they’re convenience-sensitive. They want it when they want it.

The record companies should have done something like Hulu. I gather there were antitrust issues. Hulu does a good job, and it also helps TV companies control things a little bit. Hulu also makes money. The labels together could have done something pretty well.

Q: And DRM?

Levine: A lot of people say DRM was huge problem. But when EMI eliminated it, it didn’t create a huge boost in sales. People hate DRM in that it won’t let them do what they want, but very few people are against it on principle. I haven’t seen any evidence that people care. Sales don’t respond to DRM policy.

People want something easy to use and iTunes is easy to use. Convenience is what iTunes delivers.

Q: Your argument is really to get money flowing to the creators online.

Levine: We’ve had a market for IP for at least 300 years. I think it works pretty well. If you compare the cultural output of countries with a market for IP and those without, it’s clear that a market gives you better IP on an economic level, and possibly on a cultural level too.

If you look at West Germany, they produced Herzog, Fassbinder, Can, Neu! and Krautrock. In East Germany they produced, well, maybe some good TV shows, but not ones they could export.

Or if you look at Nigeria and Brazil, they’re countries that in the 1960s and 1970s had great pop music that changed the world. In Brazil, you had Tropicalia, Gilberto Gil and Os Mutantes; people still buy those records today. in Nigeria, you had Fela Kuti, who is still as iconic as he ever was. This generated money sent back to Brazil and Nigeria. Now people are still making the music but not a lot of money is going back. And those countries could use the money. The culture business is one that generates jobs that are pretty good, and doesn’t create a lot of pollution, compared to BP.

If the culture business disappears, then culture is not going to disappear. I use the example of The Beatles without George Martin: they would have continued to be great songwriters, and we’d have the songs, but they wouldn’t have made great albums.

You can’t have an economy without a market. You can’t have a market without property rights, and you can’t have property rights without a means of enforcing those rights. Copyright has some aspects of property, and one of these is you can’t sell something if somebody else is giving it away.

Q: There’s a whole chapter on Google, which if people aren’t familiar with it, might come as a bit of a shock.

Levine: There’s a popular narrative and that says Google is cool – and it’s a very coherent story. There are even parts of it that are true. What I wanted to do in the book is a factual counter-narrative so people can compare them side by side.

The music industry certainly lobbies for things that aren’t good for the public. But at least you know the RIAA is a lobby. And the BPI. They’re not boy scouts, but they’re forthright about what they’re doing.

Google is not forthright. They give money to the EFF, Public Knowledge, and to all these other groups, but they’re not very honest about what they’re doing. You can say term extension is a consumer issue, but the way Public Knowledge talks, you’d think cable TV for less money is a constitutional right. It’s not. You have no right to watch World Cup soccer. That’s crazy.

Some of this is really the fault of journalists. Public Knowledge declares its income on its website but journalists don’t pick up on it. So it is described as a “consumer rights group” when “consumer rights group funded by technology companies” or “group that lobbies for consumer rights and technology companies” would be more accurate.

Now if you look at the academics – I write about Professor Lessig but it could be William Patry or Tim Wu – a lot of their work is really shoddy. Wu writes about the movie business, but he doesn’t understand how films take in money. Lessig also gets a lot of details wrong. Now, either he’s not smart enough to get these details right, or he’s being deceptive. I would say he’s smart enough.

He writes about how Disney couldn’t make its classic animated movies today because of copyright law. But there’s no evidence for that. Walt Disney licensed stories to make films. He licensed the story for Bambi, he licensed the story for Dumbo, he licensed the story for 101 Dalmatians, and many others. That process is exactly the same as it is today. The Brothers Grimm stories would have been in the public domain even under today’s copyright term – which I think is way too long, by the way.

Lessig also says how copyright has expanded to cover characters. But that came from judicial decisions, not statute. That wasn’t the result of lobbying. You can say the courts interpreted it wrongly – but it’s nonsense to say it was lobbying. It’s unbelievable to me he’s considered a serious academic.

Q: Sousa is another example Lessig likes to use. Sousa complained about “infernal machines”, phonographs, and refused to be recorded. But he changed his mind, which Lessig never tells us …

Levine: Sousa was the Metallica of his day. His songs were being recorded and he was not being compensated. He objected. Like Metallica he phrased his objection in a very poor way – but musicians aren’t lawyers. Sousa said, “I don’t like the technology, I prefer people to sing songs from songbooks.” He was getting paid for songbooks, of course. But once Sousa was being paid for his records, you can see his attitude turn around.

Lessig, who is supposed to be such a scholar, gets it wrong – it’s appalling. Harvard and Stanford should be ashamed of themselves. It’s not serious academic work. It’s not worthy of a Harvard professor.

Americans also tend to assume the whole world is under United States law. But you’re talking about a specific Anglo American tradition. I grew up under it and I like it. But there are other countries in the world, the French in particular, who have a very different tradition of copyright. That includes strong moral rights for authors.

Lessig will write these books of his about copyright but never once mention these other traditions – I think that’s wrong. You can make a case that in the continental tradition, you have a right NOT to be remixed. Should that be there? I don’t think so, personally. But the idea you don’t mention moral rights in a book about copyright is dishonest.

Q: But the academics don’t need corporate sponsorship to say what they say. Wouldn’t they say it anyway? They’re fully signed up to the belief system.

Levine: I think Lessig is sincere about his desire to make the world a better place, and he wants to reduce corruption in Washington. But he has made some compromises that make it hard to take him seriously. He’s not the guy to do that.

I will say he was tremendously courteous in answering some aggressive questions. I don’t have a bad thing to say about him personally.

Q: You spend a chapter on blanket licenses in the book. And the reaction from creative industry people who have liked the book has been mostly critical of this idea. Doesn’t a blanket jar with your advocacy of markets?

Levine: The ideal is we have a market. People will pay for Spotify or downloads or new services, but if we can’t get that a blanket is an option.

When you signed up to an ISP you could choose if you wanted the music add-on. The government creates a situation where you can get such a deal. With your ISP you’d tick a box: “Yes, I want $5 for all the music I want.” If you don’t tick a box, then you’ll get check at random and there’ll be a substantial penalty. Not $500,000, but say $500 – like a speeding ticket.

Q: I really liked this idea for a while, but eventually I couldn’t get around some problems. It’s a tax that penalises people who doesn’t do online music, and it undersells the value of the music. And everyone else will want a piece.

It also sets the limit for the amount of money the market is worth.

Levine: I wouldn’t call it a tax: it’s not a tax. A tax is imposed. It’s a levy. When Jim Griffin launched his Choruss plan everyone called it a music tax and said you have to pay for music. Well, guess what – you already have to pay for music. Jim wasn’t trying to get people to pay for something they’re not doing. If you want to listen to music in a restaurant, you’re already paying. You always have to pay for music. It’s just that it is a levy, it is part of the bill, and the collecting society makes it easy.

Levine: I wouldn’t call it a tax: it’s not a tax. A tax is imposed. It’s a levy. When Jim Griffin launched his Choruss plan everyone called it a music tax and said you have to pay for music. Well, guess what – you already have to pay for music. Jim wasn’t trying to get people to pay for something they’re not doing. If you want to listen to music in a restaurant, you’re already paying. You always have to pay for music. It’s just that it is a levy, it is part of the bill, and the collecting society makes it easy.

‘A blanket licence is terrible for everybody compared to an ideal world. But you have to compare it to what’s happening now’

You’d have to do it so it added up. By mobile device not by ISP for example. So you could get a little more that way. You could create add-ons. You could offer people the right to upload their own stuff. Or play it in their living room stereo as well as on their computer. I don’t think £7 or £8 a month for all-you-can-eat music is so terrible.

Q: Not exactly a market solution is it?

Levine: A blanket licence is terrible for everybody compared to an ideal world. But you have to compare it to what’s happening now.

When YouTube goes to the culture industry and says, “We have all your video: do you want to get something, or nothing?”, are they not in effect setting a price? Some of this is already happening. It’s really bad, but it’s happening. You can’t turn the clock back. It might be an idea to think about it before a blanket is imposed.

To fix things, you need to do two things. You need to make illegal commerce harder, but your success is going to be based on legal commerce: don’t choose one or the other. You need to make Rapidshare a pain in the ass to get to and inconvenient, and also make something like UltraViolet as easy to use as possible. ®

Robert Levine’s Free Ride blog is here.

Doug Keenan, the statistician whose work highlighted severe flaws in the work of the Climatic Research Unit at East Anglia, has welcomed the Sunshine order to open up the station records.

Scientists need the raw data to replicate temperature records, but CRU refused to release the data requested – a subset of weather station records from around the world – to a top UK Oxford physicist, despite having already shared the data with Georgia Tech in the United States.

The ICO comprehensively demolished the reasons CRU offered – including intellectual property and fear of jeopardising international relations. In doing so, it’s raised the standard for academics working across all UK sciences.

“The ICO’s Decision Notice is an extremely well-reasoned work, with rigorous logic,” Keenan said. “They did similarly with the Decision Notice for my FoI request for the Belfast tree-ring data.

“Of course I am glad about the decisions that the ICO reaches, but more than that, the logicality of the arguments is strongly impressive.”

It’s a surprisingly aggressive ruling, in that it acknowledges the IP rights of owner of a database – but says that there is a greater public duty to disclose the data.

“Some of UEA’s claims are absurd, for example, that the requested data was publicly available,” Keenan told us. “It is clear, then, that UEA is trying to find some excuse to prevent disclosure of the data.

“What, then, is their real reason for not wanting disclosure? If UEA is truly interested in advancing scientific understanding, why do they not want to make their data available to others?”

Reader comments on the story have produced some fascinating responses: lifelong anti-copyright zealots can be found explaining the benefits of copyright, and veteran “open data” crusaders advocating data be kept under wraps. Climate debates can do strange things, with cherished principles being jettisoned – the means apparently justifying the ends.

Keenan says he wasn’t impressed by the support for the CRU academics from the new warmist president of the Royal Society, Paul Nurse. At a recent meeting, Keenan took issue with Paul Nurse’s claim that CRU academics felt “bombarded” with FoI requests.

“I stated that the claim was false, and gave a summary history of what had actually happened. Nurse replied that if scientists felt that they were being bombarded, then the scientists were being bombarded.

“Nurse is plainly being illogical. He seems to believe that scientists always have honorable motivations – including when refusing to disclose data. The ICO Decision Notice provides further evidence that such a belief is unrealistic.”

It’s not the finest hour for the Royal Society which advanced the scientific method from its foundation in 1660.

On a more positive note, Keenan welcomes the BEST Project in Berkeley, California, an exercise to produce a reliable temperature record with more complete data than the world’s largest data set, the GHCN (Global Historical Climatology Network) record maintained by the US National Climatic Data Center.

A large number of station records outside the United States were removed between 1988 and 1992, resulting in more interpolation. Critics say this cooled the 20th Century temperature record.

BEST is documenting its methodology, and the algorithms it uses. So hopefully, no FOIA requests will be needed to replicate their work. ®

Perhaps it is. Even deep Greens are dropping long-standing objections [1] to nuclear power generation. I got in touch with Imperial’s Professor Robin Grimes, who recently co-authored a Science paper with William Nuttall indicating how the nuclear industry could re-emerge. Here’s an interview that encompasses the current state of play, and some ideas about how the next 40 years could take shape.

Professor Grimes disagrees that nuclear has been moribund – it just seems that way in the UK and the USA, he says.

“We’ve been in stasis. Only in the last five years has the amount of power generated by nuclear started to decline. It’s not as catastrophic as has been described. While we’ve not been building new reactors here, in Asia, they have been, and the [North] Koreans and Japanese, and China and India, are ramping up. There’s been a shift of activity from the west to the east. The number of reactors has increased.”

Ten new nukes are planned for the UK, with the first becoming operational in eight years. The problem here is one a skills shortage, caused by an ageing skills base. You need “Squep” people (suitably qualified and experienced) to monitor the safety of the facilities. The Nuclear Installations Inspectorate, the enforcement arm of HSE’s Nuclear Directorate, recently acknowledged this by raising pay rates, hoping it could hold back the ageing experts from early retirement, or even lure them out of retirement.

Top 10 Nuclear Nations (2009) by operational output – Source:IAEA

“I’m not sure if we can call it a Lost Generation, but it almost feels like one,” says Grimes. “We are in significant danger of losing the real experience as the skills base is built up again,” he says. “The amount of activity has started to increase dramatically, but they’re inexperienced.”

A look at the third-generation nuclear technology on offer shows incremental improvements, and bears out a clutch of new ideas. The latest reactors are smaller and more modular. The design focus is on passive safety features, and using materials that are radiation resistant.

Examples include the AP1000 [2] from Westinghouse, Areva’s EPR [3] (Areva design).

Unlike today’s thermal reactors, the Generation IV designs currently on the drawing board, take in the whole fuel cycle as part of the design concept. The reactor burns get rid of the highly radioactive nasties – including plutonium and the minor actinides [4]. In their Science paper, Grimes and co-author William Nuttall write that “some of these options could sustain power production for more than 1000 years”.

Surprisingly, the current vogue over the past five years has swung towards smaller reactors – below 1GWe (Gigawatt-electric) output. Why, I wondered, go for smaller plants when the planning process is so long and site acquisition is so expensive? Why not just build a big one?

Top 10 Nuclear nations (2009): number of reactors – Source: IAEA

Grimes says: “It depends on how much you need. There’s little point producing 1GWe when you only need a 10th of that, 100MWe.” Westinghouse’s AP1000 is, as the name suggests, a 1GWe station, but it started off as a 600MWe design.

Costs

Nuclear is unchallenged when it comes to producing baseload electricity, but controversy rages over the true long-term cost. Grimes acknowledges that CO2 reduction targets help enormously.

“I don’t see nuclear as something that produces all your electricity, it’s a mix, and getting the balance right is crucial,” he says. “It’s going to be different for different countries; I imagine we’d want to build a lot of wind turbines, but we’re going to need nuclear as a our baseload capacity – and a lot of it.”

Disposal costs will fall by the time the Generation IV reactors come online.
Nuclear energy facilities under construction, measured by output (MW). China has 24 underway and Russia 11.

Source: IAEA

“My personal opinion is that a complete recycle, with complete reuse of uranium and plutonium and the minor actinides is feasible, but it leaves us with a 300-year problem.”

Which is a major improvement, of course. Currently some of the isotopes in the actinides have a half-life of 100,000 years. We should remember where we left stuff 300 years ago, particularly if it’s radioactive.

Readers regular raised a couple of fascinating developments in nuclear research. What did Grimes make of them?

One is using the thorium fuel cycle. Thorium is four times more abundant than uranium. India is the biggest backer of thorium reactors. Grimes took a visit a year ago to have a look [pdf [5]].

Thorium: There’s a lot of it about

Thorium, however, doesn’t have a fissile isotope, which complicates things a bit: you have to breed the artificial isotope uranium-233. Grimes points to another advantage.

“Because you’ve started with a lower mass isotope number, you produce less of the higher atomic number isotopes – plutonium and minor actinides – than you do with a uranium-plutonium cycle.”.

“It will happen, because India wants it to be so. It has a lot of thorium, and not a lot of uranium. So that will allow us to get over the technology barrier; it could well be that it’s a sensible and viable option.”

Another factor comes from a quite unlikely source. Norway has one of the highest per-capita GDPs in the world, thanks to North Sea oil, and has reaped the benefits of hydroelectric power. But Norway discovered it may also be sitting on one of the world’s largest supplies of thorium oxide.

Pebbles: The ‘politically correct’ reactor

Eco-friendly? Koeberg’s PBMR project never got off the ground.

Another remarkable innovation in nuclear energy is the pebble-bed reactor [6], variously described as the ” politically correct atomic reactor [7]” [pdf], or the nuclear power plant you could leave in the hands of Homer Simpson.

The idea isn’t new, it was first demonstrated in 1967. But with traditional concerns about nuclear plants (such as meltdown) made moot by the inherently safe design, it’s curious that pebble-bed designs are not common. It seems they should be as common as neighbourhood transformer stations. (Reactors used in nuclear-powered icebreakers are as small as 35MWe.)

South Africa last month signalled it would end its 11-year PBMR [8] (Pebble Bed Modular Reactor) project, shedding most of the 800 staff working on the project.

China and Germany continue to develop designs similar to the PBMR.

“It’s always the bridesmaid,” says Grimes. “I’d like to see it developed. As scientists, we need that flexibility of technologies going forward. PBMR is inherently safe and it’s modular. But the small LWR reactor designs are also modular in the same way, and in terms of safety, the AP1000 has equivalent safety features such as passive cooling. The advantages of PBMR are definitely starting to be clear in the LWR design. That’s taken the wind out of its sails.”

“In a traditional reactor design, the decay heat – once fission has been turned off – is enough to destroy the reactor core. There are two things you can do – even if you lose your water, you can have a passive water volume that flows through the reactor from big tanks on the roof. You don’t have to do anything – it’s a passive process. Even though water’s running out, it’s removing the decay heat. It is exponential decay – so the residual amount of heat is no longer a threat. However there are additional features – natural convective processes that keep water moving around outside and keep the vessel cool. It’s really simple.”

Nuclear still leaves proliferation problems, but as Grimes points out, “nothing is proliferation-resistant, there are just degrees of it.”

And fusion?

“Sure it’s possible. JET [9] has been a great success, there’s no question. But JET is a long way from a commercial reactor; even ITER [10] is a long way from a commercial reactor. We need an entire generation of fission reactors with 60-year lifetimes.”

The ambitious, Nokia-sponsored interactive extravaganza began this weekend, and it’s an interesting experiment. In Kring’s own words, this series of events, called Conspiracy For Good, is “not quite a drama, not quite a flashmob, not quite an ARG [alternate reality game]“.

What is it, then, and how did it come about?

Kring says that the underlying message of Heroes was one of “hope and interactivity and global consciousness and saving the world”, and when Nokia approached him to do some content for Ovi, he pitched the idea of anti-capitalism activists shaming a wicked corporation by using Swampy-style hacktivist tactics. You can be Swampy, if you wish to be. I have no idea if you get to keep the phone, but Nokia is donating towards a real library in Zambia and giving away 50 scholarships if the bad guys lose. So there’s very little prospect of the bad guys not losing.

It was the love-child of Nokia’s VP Tero Ojanperä. So for four weeks you can find clues hidden online and in the real world. You’ll encounter reality actors or “reactors” – some in character as Swampies, some as evil corporate suits – to guide you. And you’ll be using a Nokia phone.

Kring calls it “social benefit storytelling”. But you can see another reason why it appealed to a technology company – because Kring endorses the modern idea of “engagement”.

“Shows like Lost and Heroes did force you to go on line and look for clues – they were sort of a bridge to this. Each tentacle carries one little piece of the story and you have to put the pieces together,” he told us. “It’s not the same as letting it wash over you – you’re forced to participate, and guess, and predict.”

Which audiences have always had to do before – with Miss Marple, or Twin Peaks. But because the interactivity is now electronic, tech companies are very interested. In this version of ‘engagement’, the concept of the Mind places it as a kind of communally-shared external cyber-appendage, a bit like the Ood’s Hive Mind in Dr Who.

So how would it work, I wondered. People will shame the fictional corporation into… what, exactly?

Kring explains:

“We have this contract that proves they illegally obtained this land, and they’re a very tricky corporation. and in a very guerrilla kind of way we expose them. Busted exactly. But there’s a lot of stuff to find out before we bring them down.”

There’s no doubt who’s Good and Bad here. Isn’t what makes great drama the moral ambiguity – forcing the audience to decide who to root for? When people are forced down one path some rebel, while for others it becomes an exercise in reinforcement.

Kring politely disagrees.

“I may not completely share your view, I believe in archetypal and mythical storytelling and what’s missing from the world. We used to know what’s right or wrong, by the myths we heard around the campfire. Those are now missing in our culture and have been replaced by consumerism.

“We really wanted the secret society to be really cool. We force the audience to choose which is the right path; by giving them a moral fork in the road.

“People are starved for archetypal stories, where there is good and evil and people are given a choice.”

It just didn’t seem like much of a choice – particularly if you were being guilt-tripped. 50 people in the real world would lose out on scholarships if the Bad Guys won. Kring didn’t think so. On Heroes, he explained, some people started supporting the bad guys.

“If some people want to become part of [evil corporation] Blackwell Briggs, that’s fabulous! On Heroes people started a Syler’s army where they identified with [evil megalomaniac] Syler.

“Ultimately if you align yourself with Blackwell Briggs you have been on the wrong side of the narrative…”

Surely you’ll burn in hell for supporting Blackwell Briggs?

“Hah, yes.”

I thought these questions probably arose because a decision was made to put this into a political context. There’s no problem with killing a zombie or a cannibal, or even an alienate determined to wipe out the human race. Did he need to give such an explicit and simple political view?

“We try not to be political”, says Kring. “We tried to create someone who’s the face of persecution, corporate greed, and injustice.”

But the world really isn’t so simple. The idea that business is all bad and philanthropy good is one that quite a few recipients of charity might see as a bit patronising. Grinding third-world poverty isn’t much fun no matter how many books you’ve got – and yet economic development gives us incubators and… Nokia phones.

“I’m not sure I follow.”

For Kring this problem was solved by making the bad guy so bad any such ambiguity might be banished.

“Well, Blackwell Briggs is trying to trade on human capital to exploit resources. They’re involved in child labour and … we’re trying to exaggerate it and make it so broad no one can have any doubt. Cutting the heads of babies, that sort of thing.”

Was the choice of name for the bad guy a coincidence, then?

“The name was meant to conjure up Black Hats, good guys wear White. Any resemblance is just a coincidence.”

So Xe (formerly Blackwater) haven’t sued you?

“Not yet,” he says.

And there’s something else unusual. Here’s a group of record companies that are doing well, both critically and commercially, which think the internet has helped them to this success, and can’t wait for the future to get here.

Beggars’ four labels XL, Rough Trade, 4AD and US stalwart Matador Records scooped up a fifth of the Times Top 100 records of the decade. The company recently scored the first indie number one for twenty years (Vampire Weekend), looks to have the critics choice for 2010 sewn up (Gil Scott Heron), and with The Xx has a band whose music suddenly seems ubiquitous, sprouting from every trailer and advert, as well as the BBC’s Election coverage.

Mills himself resigned from the BPI “years ago” and helped set up two powerful industry groups as a counterweight to the major labels: the Association for Independent Music (AIM) and Impala, a Brussels-based business network of companies and trade associations. Impala was crucial in persuading the Courts to overturn the European Commission’s decision to bless the Sony BMG merger. The collective licensing group Merlin, sometimes called a ‘fifth major’, also owes much to Mills’ desire to give more strength to the indies at the bargaining table.

The Beggars setup is also quite unusual, a bag of apparent contradictions. Mills still signs every cheque, and watches the weekly cashflow, but the labels, such as Richard Russell’s XL, have a lot of freedom. The core of the Beggars Group is an operations unit for the labels, but he doesn’t do budgets or ask the labels to do them for him. It’s impossible to predict how music will sell, he says, so why waste the time? In a business that became increasingly populated by suits in the 1990s, this is very unusual.

Mills spends a lot of time thinking about how to make money, but his distaste for “music corporations” is matched by concern about the “corporatisation of the individual”. You can’t imagine a New Media Strategist setting foot in the place, or surviving very long if they did. People work at Beggars for the love of music, and are good at finding it and promoting it.

So there’s a lot of reasons to pay attention to Beggars, and Mills’ thoughts on the future of music. We had a very wide-ranging interview last week covering everything from digital marketing to the Digital Economy Act. A few facts first, though.

The Beggars Banquet label grew out of an Earl’s Court record shop in 1976. Three years later it had picked up Tubeway Army, and found itself with a global pop star. But unlike other indies of the era it didn’t embark on overnight global expansion. This may be why unlike other contemporaries such as Stiff, Rough Trade or Factory, it survived. 4AD was launched in 1979, XL a decade later. It picked up Matador in 2002 and Rough Trade three years ago.

The group now employs around 130 staff worldwide. Between them, the labels invest in 20 new acts a year. Digital revenues are around 50 per cent of the total, far higher than the industry average. The Vampire Weekend number one sold 126,000 in its first weekend, of which 70,000 were digital downloads. In the UK digital is about 20 per cent (up to 30 for new releases, says Mills) while in Europe the ratio is much lower.

There’s also a distinctive profile to the success: Beggars’ labels are much better at selling full-length albums.

“We are four times as likely to convert a fan into an album buyer, rather than a track buyer. It makes a fan that we engage worth ten times as much to us. If you look at The Xx album, they’re selling three tracks for every album, a 1:3 ratio. The industry average is more like 1:10 or 1:12.”

The internet has improved things radically for independents, something borne out by the US success, with its more mature digital market.

“There’s fewer gatekeepers now. We don’t have to knock on a TV station’s door or a radio station’s door and it’s made us far more competitive. We released the MIA film yesterday and within minutes, it was everywhere. We didn’t have to go through a process to try and persuade someone to give it an exclusive. Our ability to get the message out without intermediaries is unencumbered,” he says.

“There’s a wide highway in front of us we can go speeding down, and it wasn’t there even two years ago. It means the majors are looking at a world where only 35 Gold Albums a year are certified compared to ten times that recently. But going above Gold in the US is not a problem for us.”

The internet has revived interest in music, thinks Mills, by encouraging people to experiment.

“It’s made so much more possible – a greater and deeper love of music. It’s re-stimulated my own involvement in music generally, rather than just my business. The links people send you allow you to go off down a path and discover something great.

“People who in their 30s a few years ago who may have stopped listening to new music, or were listening to iterations of music they heard in their late teens or early twenties, are now able to discover entirely new things. You’ve got new artists being discovered by 30, 40, 50 and 60 year olds. You’ll now have a group of friends talking about music and sending links. I think that comes from the integration of the laptop into both our working and our personal lives, the internet is so great at spreading the word.”

It’s also made production cheaper.

“The scale of our investment has changed. Recording is cheaper these days. Film making is cheaper. You can make the raw materials that we invest in miles more cheaply. The excesses of record deals largely disappeared, so we much more able to invest at a realistic level, rather than an insane level, which we sometimes had to do, and sometimes we still do. But we’re probably signing 20 new artists a year across the 4 labels, and investing significantly in all of them. We still spend 20-30 per cent of our turnover on artists. So although it’s at a level more sensible than it was, it’s still very significant, and it’s what we do.”

In recent years, the Beggars labels have had established acts knocking on their door, such as Radiohead. I wondered if this altered the investment pattern?

The artists we’ve done we thought were truly exceptional. We’ve no desire to be where Sanctuary were in their heyday. We’re all about getting a band to a stage where you can see it’s working.”

The reason for the independents singing a different tune to the majors, he suggests, is quite interesting.

“You read the industry is 60 per cent of the size it was ten years ago. But that 40 per cent that has gone is almost entirely the cream at the top. Records that sold two million now sell 500,000 – that’s where that’s gone. At the same time it’s easier to sell those slightly smaller levels.

“What’s called pejoratively ‘the new middle class’ is someone like, say, Calexico or Midlake, who can sell 100,000 plus records every time they put out a record; they can play to 3-4,000 people in 30 or 40 cities around the world. And they can make a pretty good living out of that, doing what they love doing, and can do it on their own terms, and that’s fantastic. We’ve got a bunch of bands like that, they’re not necessarily seeking stardom or riches. That’s incredibly healthy.”

But it’s still recorded music that drives the success, most of the time.

“99 per cent of what you hear about artists who can survive on their own playing live is crap. It’s recorded music that drives success in other areas. Something like Enter Shikari was clearly a contrary example, and Mumford and Sons are something of an exception too – they built a large live following before putting out records – but there are very few exceptions.”
Radical Reforms needed

Despite the sunny outlook, and his belief that its “probably bottomed out, the onslaught of free music is retreating”, Mills says the industry needs to reform itself radically, and lose its fear of commercial experiments. The future is in new services we haven’t seen yet – but it’s still too hard for these services to start selling music.

Some kind of statutory licensing would help the next Spotify or We7, he thinks. Not an open-to-all statutory, where punters could come and help themselves to all the world’s music for a fiver a month – but a B2B experiment – something to help intermediaries obtain licenses.

“We have to make licensing easier and faster, not necessarily cheaper, but easier. We’d like to see some kind of short-term government-endorsed trial structure that we could experiment with for 12 or 24 months, and see the impact of it.”

What would stop some joker turning up, who had no business plan, or maybe even no intention of ever paying for the licenses?

It would need some kind of government agency to approve licensees. But regulators already decide who can run a TV station, or call themselves a bank – there is a threshold. “You’d have a validation process so not everybody who turned up got one.”

Mills says the flat-fee collective licensing of ISPs, touted by some as a panacea with a zeal bordering on the religious, doesn’t have much industry support.

“Peter Jenner has been very vocal about that for a long time. He likes to characterise himself as a crazy eccentric. He’s a lovely guy but there isn’t a huge amount of support in the music industry for something that radical, and it’s not needed. A lot of markets are working quite well. Look at the growth of the download market, it’s pretty healthy. We have 5 to 10 per cent growth a year in digital albums, it’s heading to 30 per cent of the market now.

“Having a single way of consuming music for a fixed amount, that’s same for everyone around the world, is nuts I think. It’s not needed.”

It would also be bad for independent labels who cater to music lovers. By contrast, he’d welcome an offering of a fixed bundle of downloads, via an ISP.

“Unlimited all-you-can-eat offers would hurt us badly. Our market is dedicated high-spending music fans. If you’re Universal, sacrificing the few high-spending fans they have to get many more low-spending fans is probably a good bet. We’re on the other side of the mirror. Much as I would embrace it philosophically, I can’t embrace it practically. There has to be a limit or cap. It would hurt our artists.”

The industry also has to create a global database of repertoire, he says.

“We need a database to track and identify tracks properly and who the performers are. We should have had it ten years ago, it becomes a bigger task with each year. It’s a minefield of partially-attributed rights. When you license a song for a compilation in Australia, you don’t know where the money will end up.”

The Mandybill: was it necessary?

On to the subject of piracy then.

“We know some of our best purchasers are also pirates,” says Mills. “People consume our music in a mixture of ways. Some only pay for it, some pay for none of it, and some do both. We accept that, and don’t want to attack our own fans.

“You’re never going to get rid of free music, partly because we know you can’t, and any time you put a price on a copyable monopoly good, you’re going to get copied, but also because we’re in the business of circulating music for nothing. I can’t remember the last album we didn’t post one MP3 from. We’re using that in a controlled manner, as part of the process of making it available for sale. It’s managed, and it’s what the band wants to happen.”

The argument that P2P leads to purchases has a grain of truth to it, but it’s probably been over-emphasised:

“I think there’s certainly a percentage of file sharing usage, historically, which provided a discovery process that led to sales. There’s also a percentage which was a direct substitute for sales. Now, you’ve got the likes of Spotify and I think that it drives a coach and horses through that argument. You don’t need to file share to discover music now. If you want to discover things and listen to them you can do it legally, though I do think we should make tracks available for sale as soon as they’re being played on air.”

Other factors played their part in the decline of sales, he notes, not just P2P. “CD burning made the most immediate and obvious difference. I don’t believe swapping should remain outside copyright, we should enable private copying in return for a right to remuneration.”

Yet despite Mills’ long-running battles with majors, and a much more nuanced view of file sharing, he welcomed the passage of the Act.

“Your comment recently, that it was an astonishing result in the circumstances, was really right. The forces ranged against it happening were huge and well funded, and completely dwarfed the rights industries, not just the music industry. The government made it happen against the odds. There’s a long way to go, and a lot of it is still undecided, but the principle is now there, and the principle as now supported by Parliament – which is that creators have to be rewarded for their work. That has to be valuable.

“It was not perfect but it had to be done.

“I find it quite hard to understand the right to free music, or the right to an internet connection. If you don’t pay your water bill, you get cut off.

“The BPI doesn’t represent the whole industry. It represents the major record labels. I think that the creation of UK Music has helped – it’s given the industry a more moderate collective voice. The big record companies are hardliners, and they have every right to decide how they want to play the game, but the independents are bit different.

“That said, I think the BPI is more open to debate than it used to be.

“It’s not in anyone’s interests for the majors to do badly; they become defensive. We’re at the mercy of the market leaders, they frame the market, and we have to operate within it.”

Mills stresses that it’s now up to the industry to get better at selling music, in all kinds of ways:

“I’m still astounded that you need a credit card for iTunes, something beyond the reach of most teenagers, while you can’t buy music by text message.

“The last ten years shows the record industry is not able to provide its own solutions – you need an iTunes to do it.” He says the industry has to recognise the skills of retailers again. It’s never been very good at introducing these things, “perhaps understandably, because it’s not their business … majors tend to be about control”.

But he thinks even though music is digital, independent music stores will come back again, as places to discover music again.

It’s unusual to hear an optimistic view of selling music, but Beggars and the leading British Independents point the way to a revival.

“The technology was sort of there. That software was there, and it was good – I wouldn’t do it that differently now. The basic model was just as appropriate then as it is now.”

– Chris Castle.

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Don’t judge a book by the title. Especially if the title is something like Cyburbia. James Harkin, who worked with Adam Curtis on The Trap, has produced the first proper full-length critique of Web 2.0 – tracing the daftness back to the cybernetics pioneers of the 1940s.

It’s odd that something with so much hype as Web 2.0 has received so little intelligent criticism. Half of Nick Carr’s The Big Switch, looked at the social and psychological implications, and he’s following up at length in The Shallows.

But Cyburbia takes a different approach. By looking at the mania for feedback in a historical context, Harkin finds a common thread in subjects as diverse as military strategy, TV shows like Lost, as well as the interwebs.

Q. We’re used to cyber-everything but can you define cybernetics for us?

Harkin: There are a lot of definitions but the simple idea I use is this idea that what distinguishes human beings, or what’ smost important about humans, is that they exist on a continuous information loop defined by a constant stream of messages we’re sending or receiving.

Now you can interpret the world in that way – me picking up a glass, say – but it is just a metaphor. The story of my book is how this metaphor, created by Norbert Wiener, because of its beauty, became the inspiration for a new medium and influencing how we live. It’s given rise to all this incredible technology, but the idea of fitting ourselves into that mould will mean we’re the losers.

The central image of the book is Cyburbia, this strange alternate world where we watch each other and the minutiae of each others’ lives.

You might have stared out of your window in suburbia in the 1950s and seen a few people across the street, but now you can stare at millions of other people. The danger is that when you spend all your time deciphering what other people are up to, you never get around to doing something original on your own, because you’re so swamped by opportunities to go onto other people’s lives on blogs, social networks and Twitter.

Did you start off with cybernetics and then see parallels around us today, or did you start with Web 2.0 and trace it back?

I started off with the image of Cyburbia because I liked it, the image of people retreating from the world and staring at other people’s lives. Now that’s a nice image but it doesn’t really explain a lot .So I began to trace it back to first Stewart Brand and then back to Norbert Wiener, a brilliant polymathic genius. I traced it back to the hippies then realised it goes quite far back beyond them.

Now I’m not arguing people are stupid or lazy if they do that – but there’s an electronic peer pressure online. Academic studies that have been done by people who are very sympathetic to Web 2.0 and networks, people like Clay Shirky and Duncan Watts, show that the whole decision making process tends to become a robotic routine. One person makes a decision, and everyone else falls in line.

One aspect of the suburbia of the 1950s we see online is the conformism. This is incredibly ironic, because this medium was set up, for political reasons, to be incredibly individualistic and creative and non-conformist.

What I like about the book is that it doesn’t fall into the trap of responding to utopianism with a dystopianism: that we’re all doomed. That’s a really common response, but people are intelligent, and discerning about technology. How do you resolve this then?

At the risk of sounding dreadfully like Marshall McLuhan, people haven’t quite understood it as a medium yet. They’ve become so focussed on the idea that we’re “freeing ourselves from the authority of the ‘mainstream media”, that we think that pressing buttons on a computer to talk to your neighbour is an authentic way of communicating. It’s not.

The net is a medium like any other and has its biases, like any other. The biases are different.

The problem people have is that they’re reluctant to describe it as a medium – they see it as a political idea, not a medium. So circumventing the mainstream media is not in itself authentic.

As you know, Andrew, if you criticise Web 2.0, people get offended. It’s peculiar that they should get offended: you’re criticising a medium. What they see is you criticising a groundswell of popular democracy, a movement, which it isn’t at all. It’s a bunch of machines.

There’s an odd aspect to cybernetic ideas a few of us have noticed, which is that some people who adopt them go off the deep end, and lose their minds. They dive in completely. They really lose their sense of self.

If you’re engaging with the internet gurus who are very evangelical about Web 2.0 you’ll hear a very good argument. And that’s for the first time in history, millions of people around the world can have a voice. They can input all their thoughts into this system, and people can read them unmediated by anyone. Now, that’s interesting, and it’s a good and a challenging argument. But if you stop and think about it for a second, it’s also wrong.

It’s wrong in an instructive way. To confuse any kind of democratic movement with typing words into an electronic machine which no one may ever read is really quite insulting. Given the history of modern democracy – everything from the French Revolution to the Civil Rights movement, to the Miners’ Strike – to say that ‘this is the first time people have had a voice’ actually tells you a great deal about the lack of understanding the Web 2.0 people have.

Yeah, I first came across six years ago with the bloggers Googlewashing. They replaced a real political movement with a synthetic one. I thought they’d be a bit embarrased by this, but they couldn’t see why people who had gone on marches against the Iraq invasion were pissed off with them.

It’s scary. It’s not pedantic to say if you can confuse the ability to type things into a blog no one will ever read with a voice, then something is deeply wrong with your political philosophy.

People who are being critical of Web 2.0 and this constant and continuous flow have a difficult time of it. It looks like you’re pissing on someone else’s parade. But I think there are serious and important arguments, here. The intellectual justifications that have been made by internet gurus are simply wrong.

And these are people who are being paid large amounts of money by companies to reorganise how the rest of us work.

Jaron Lanier suggested a reason for people going bonkers. He picked out neo-Darwinism as an example of a cybernetic idea that prompts this. The belief “.. that what Darwin described in biology, or something like it, is in fact also the singular, superior description of all creativity and culture” as an example of cybernetic totalism. This is a hole Richard Dawkins fell into.

I’m not an expert on Dawkins, but I can argue that part of my story is a sort of tragi-heroic story. It’s a story about people who, over the last 60 years, have been trying so hard to implant themselves into a network. They very much wanted to become a node in the network, because they saw the network as being so much more powerful. In doing so, they lost their sense of human-ness.

But the network isn’t as powerful as the adverts suggest. Human-ness is infinitely more powerful than an algorithm.

It’s similar to the Singularity idea, where we weld ourselves into a cybernetic system, and in about 2040, or whenever it’s supposed to be, we disappear like a puff of smoke.

Technology should be so much better. The web has hardly started, really. But only the new priesthood of web designers are allowed to criticise it, or make improvements. There is a grain of truth in what the evangelists say, it’s the mountain of crap they’ve piled on top of it that’s the problem.

The evangelists are simply wandering about waving empty books, saying “Look, a book! How incredible. Pay me fifteen grand to talk about an empty book.”

It’s a transitional period. Even skeptics like us need to emphasise the positive.

I’ve done that for years by advocating legal, licensed P2P file sharing, which I find almost everyone except a few activists would to have at least like to have the choice to use. Most technology utopians hate it though because it’s an admission of failure. Free music is about the only real ‘success’ the nets have delivered.

There’s another view of Web 2.0 evangelists which I call ‘Why not?’ For example, ‘Why not turn up at Grand Central Station wearing underpants in a big Flash Mob?’

But I don’t think ‘Why Not?’ is good enough. Things need to have a purpose. If you have a project or a purpose, you can use the medium to achieve that. With no ideas, no project, you have nothing. The evangelists simply believe can use this metaphysical glow of this medium to woo people.

People forget the world’s first Flash Mob in 2003, organised by Bill Wasik, was a joke. It was a joke on the gullibility of New York hipsters who would react to any kind of electronic information, and do anything you told them.

What’s fascinating is that the ‘Why Not?’ ethos of Web 2.0 people started as a joke against them.

Web 2.0 people don’t do jokes. Cannot compute. Now Linus Torvalds, the guy who started Linux, likes to say that technology doesn’t change people, people change the technology. Again, isn’t there a risk over-estimating some of the effects of technology?

McLuhan’s argument was that media give rise to everything, that media is the root of modern life. Obviously that isn’t true, and I’d never argue that. But it has an effect. Moving from oral storytelling to reading books by candle light did change things socially. It’s important to recognise that.

The oral tradition changed but I can’t buy that the human appetite for hearing a story diminished – we love stories more than ever probably, they just come in so many different forms.

People want zig-zaggy stories now. If we can discuss it without surrendering to it, we can find new ways of telling stories that baffle people, knock them off balance, and get them engaged. That’s good. But Web 2.0 is antithetical to a real understanding of what media can do to culture, because all it says is let’s surrender to the medium, and do whatever it wants to do.

When you look around you though, the best cultural operators are not surrendering their authorship or control, they’re using it to entice audiences with new kinds of stories.

I think the media obsession is an example of over-estimating the impact of technology. I find London media, marketing and advertising agency people are completely obsessed with Web 2.0, but it’s a phrase you’ve ever heard anyone else use. People just pick up the tools, use them, and are really discerning about technology. The BBC goes on about little else.

It’s dangerous because these people are prone to take all the Web 2.0 claims at face value.

I first wrote about Second Life because I was sick of reading utter rubbish. The first line of the repot would always be “I’m sitting here on Copacabana beach with loads of girls and a deep blue sea, and – bingo – I’m not in Brazil, I’m in Second Life.”

This is no way to understand any medium. Instead of trying to understand what the medium can offer, they’re simply surrendering to the whole idea.

It’s partly a demographic issue. You have a very ageing mainstream media and pompous executives who are desperate to reach out to a new audience to who aren’t watching their programmes any more. The danger is because of the demographic distance between executives and audience they take the claims at face value, there’s no critical distance whatsoever.

Why do you think that is, though? Twitter is a great example. An editor or a reporter at a newspaper needs to turn off part of their brain to write about Twitter uncritically. Part of their brain part is going ‘This is really daft’, another part is saying ‘This is cheesy’ and another voice is probably saying ‘Stop. This is a kind of behaviour that has never caught on.’ Yet they silence all those doubts. They’ll throw out evidence to the contrary.

If you’re a journalist in Fleet Street or the BBC it’s difficult to be critical, because these commands come on down from on high. BBC radio people tell me the kind of pressure they’re under to use Twitter.

Large media companies are laying off good, seasoned journalists at the same time as they’re paying these internet gurus huge sums of money to talk rubbish about the medium.

It would be a shame if we abandoned seasoned journalists who are capable of researching and breaking stories, and capable of doing more than just simply going on Google, in favour of people who are simply obsessed with the medium. That’s the danger.

Do you think it’s insecurity as Adam [Curtis] says? Or are they feeling guilty about being in this privileged position of being in the media?

It’s a transitional phase we’re in. But if journalists are messing around, then that’s a problem, they should be doing what journalists should do.

Why should they bother when they have this instant, hyperreal world they’ve constructed for themselves? Web 2.0 gives these new media journalists everything they would otherwise be drawing from the real world if they did their jobs properly. It’s an endless supply of novelty – and it promises to describe the world in a new way. It’s an alternative reality. The credibility of the media goes down all the time with ordinary people the more they write about Twitter, or whatever the Twitter will be next week.

It’s not going to rescue your media operation. If they want to save the idea of newspapers and put them online they need to take a step back from Web 2.0, rather simply chase a young demographic around like pedophiles at a playground.

One aspect of Cyburbia I didn’t find so convincing was the argument that the TV show Lost, for example, or the movie Memento, are cybernetically influenced because they’re non-linear stories. But Catch 22 and Slaughterhouse Five weren’t either, and you’ve got modernists like Joyce before that. Or Tristram Shandy

I did anticipate that. My argument is that all of these things – non-linearity, stories going off in different directions – are not unique and contemporary at all. They’ve been the stuff of high culture for almost a century. Jean Luc Godard famously said a film should have a beginning , a middle, and an ending – but not necessarily in that order. But they’ve become part of popular culture for a generation, by people playing fast and loose with computer games, texting and the internet. Remember that Kubrick’s movie The Killing [1956] where he used these devices was a big flop – maybe it was too early.

Fair enough. I’ll give you that.

You’re positive about a lot of aspects of technology, then…

It’s easy to be written off as a miserable old bastard.

Hah. Well brace yourself, I think you will be called that anyway by people who have the Web 2.0 religion, from their point of view everyone who disagrees is a miserable old bastard.

The positive aspect is that people are ripe for new ways of working, new forms of story telling – but we have to take a step back from the hype of whatever the latest manifestation of the Web 2.0 is and focus on how people are changing . The changes brought about by computers games, texting and the internet will have moulded us very delicately over the past 30 years into creatures who may be more jumpy, might more sophisticated, or may be keener to design associations and patterns of information.

All this could be harnessed, but we need to take a step back from the idea we just surrender to this self-organising system, and reclaim our human-ness.

So to introduce the first of some regular specials from Chris, here are his views on the music business’ biggest errors – and whether there’s any cause for optimism. He’s never dull, it’s mostly Chris in his own words…

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