The launch in New York today was well attended by songwriter’s reps. Arts and Labs’ mission, the group says, is “robust and intelligent networks needed for the swift and safe delivery of the online content consumers demand.”

Which very much sounds like a counterpoint to “Net Neutrality” and similar freetard-friendly campaigns – although everyone present in New York today denied that Neutrality was an impetus in the creation of the group.

What the former have in common is the same faces (typically giving each other awards) and backing from Google, lefty foundations, and the law departments of US academia. Arts and Labs’ funding is more diverse – but it remains to be seen whether it will be more effective.

The group struck a positive note about moving away from command and control as a business strategy, and litigating against consumers as a tactic. Mark McKinnon, who co-chairs Arts and Labs along with former Clinton press secretary Mike McCurry, said companies that couldn’t deliver media how and where consumers wanted it were fighting the tide.

McCurry and McKinnon also told us that the punter who simply copies a CD for a friend is not the enemy. McCurry called this “innocent” file sharing, and McKinnon said he thought this drove legitimate demand. “Mass distribution” was the problem, they agreed, such as sharing your music library via Bittorrent 24×7.

But what about “the safe and swift”?

Apparently Arts and Labs will make much of the dangers of downloading infringing material from dodgy sites. According to McAfee, 18 per cent of searches for Brad Pitt end up with the user downloading some kind of spyware, adware, or virus. So there’s an attempt to steer users to legal sites using fear as a factor. That’s certainly an argument that will be used by the as-yet un-launched legal P2P services.

Your reporter suggested that patterns of consumer demand today perhaps show that people consider the risk of getting spyware a risk to be a worth taking. The group countered that most people simply aren’t aware of the risk. A bigger problem is that this “educational” message has been tried for some time, at least in the UK, without success. It isn’t that people love wallowing in warez – it’s that the unlicensed services just offer the speed, convenience, and choice that blows legal services out of the water.

Outlobbying the Googlemonster

Google has several advantages when it comes to influencing policy. As the only internet company that makes any Serious Money™, it has huge spending resources. It also funnels its lobbying cash shrewdly: those Law Schools elbow each other out of the way for a slice of Google’s largess. And Google also has the lobbyist’s ace card: it can pose as being above the fray. Make sure everyone else is viewed as a partisan lobbyist, while you alone purely and nobly represent the public interest. Arts and Labs may begin to put a dink in that armour.

Music companies – and we blur the distinction deliberately for the moment, for the sake of simplicity – paid songwriters in two ways. For what they called ‘licensing’ – for masters and movie soundtracks, for example – the artist took home 50 per cent of the deal. For ‘royalties’, the artist typically gained or 20 per cent of wholesale or 10 per cent of retail. Along came the digital download services. When the labels cut deals for their catalogs with third parties, they considered it a royalty, rather than a licensing deal. That reduced the amount of money going to songwriters overnight.

Now many of these deals were with wholesalers such as Iris, or Orchard, who are essentially intermediaries in the distribution chain.

To you, a deal between a label and a distributor may look like a wholesale deal, and walk like a wholesale deal, but it doesn’t quack like a wholesale deal. The labels regarded it as a retail deal.

So overnight the artists’ cut fell from 50 per cent to 10 per cent. Attorney and author Steve Gordon, who was at Sony Music at the time, put it quite succinctly: “It’s all about fucking the artist.”

De-obfuscation: By law, the music collection agencies who operate on behalf of songwriters in the US cannot refuse a license. Getting money from the deal is another question. The big four labels own the major publishers, although this is in a state of flux, with the third and fourth biggest labels (EMI and Warner) looking to merge: they own the two largest publishers, and divestment is a possibility.