Schroedinger’s streaming service just died

When is a “sale” a “license?”

Cory Doctorow
4 min readJun 21, 2022

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An Apple Itunes license agreement window with a Buy on Itunes button superimposed on it.

When you buy a vinyl record, cassette or CD, you own it, thanks to copyright law’s “first sale” principle. I have real criticisms of copyright law, but at least it’s a law, created by a democratically accountable legislature. When you buy a digital download of a song, your use of it is governed by private terms of service, not copyright law.

These terms of service are outrageous. Not only are they incredibly long and dull, but they confiscate all the rights that Congress reserved to the public when they crafted copyright law. You can donate your old CDs to a library, you can leave your mix-tapes to your kid, you can divide your CDs in a divorce, but none of that stuff is on the table with digital media.

Virtually no one has ever read these terms of service. That makes sense — not only are they written to be impenetrably soporific, but they’re also so manifestly unfair that just trying to parse them risks an aneurysm. Perhaps the only way to read the Itunes ToS with your sanity intact is via R Sikoryak’s incredible graphic novel (!) adaptation:

https://memex.craphound.com/2017/03/03/terms-and-conditions-the-bloviating-cruft-of-the-itunes-eula-combined-with-extraordinary-comic-book-mashups/

The confiscation of your rights to your digital media depends on the fiction that you are licensing the music, not buying it. The fact that there’s a giant “buy now” button on the interface notwithstanding, tech and entertainment companies maintain that you are engaged in a licensing deal, like an advertiser buying synch rights for a hamburger commercial.

The digital media industry wants to eat its cake and have it, too. Even as they tell you that you’ve just bought a “license” and therefore have no rights under copyright, they tell their workforce — the creative laborers who composed, arranged and performed the music — that you’re buying your music, not licensing it.

That’s because all the record deals from the prehistory of digital music have two different royalty rates: when a musician’s work is sold, they get a low royalty rate (12%-22%). When that same work is licensed, they get a 50% royalty.

When the digital music industry was getting started, they invented a new form of quantum indeterminacy. When a customer paid $0.99 for an Itunes track, they were engaged in a license. When that transaction was recorded on the artist’s royalty statement, it was a sale. Like Schroedinger’s alive/dead cat, digital music was in superposition, caught in a zone between a sale and a license.

Because only music executives were allowed to open the box and collapse the wave, they could ensure that it always collapsed into a state favorable to the record label and its tech partners. If a listener was involved, the wave collapsed into a license transaction, and the listener was deprived of the rights the legislature promised them. If a musician was involved, the wave collapsed into a sale transaction, and the musician was deprived of majority the money their contracts guaranteed them.

Now, a musician has managed to drag digital music into the realm of classical physics, ending its quantum indeterminacy. Electronica pioneer Four Tet has successfully wrung a settlement out of his label, Domino, who will now be forced to treat his digital recordings as licenses and pay a 50% royalty, rather than the 13.5% they’d insisted on.

https://www.bbc.com/news/entertainment-arts-61871547

Four Tet will get £56,921.08 and 5% interest compounded over all the years the label was screwing him: “I really hope that my own course of action encourages anyone who might feel intimidated by challenging a record label with substantial means.”

It’s great to see Four Tet get some fundamental justice. One way that heritage acts can get some justice of their without going to court is through copyright termination. In the US, artists can terminate their copyright deals after 35 years and get their rights back:

https://doctorow.medium.com/take-it-back-e3689628f4f0

This has enabled many creative workers to cut through legal messes; for example, George Clinton was was able to terminate copyright assignments to 1,413 of his works, comprehensively ending the otherwise endless litigation against an unscrupulous manager whom Clinton accused of stealing his catalog:

https://celebrityaccess.com/caarchive/george-clinton-regains-possession-of-funkadelic-masters/

Cory Doctorow (craphound.com) is a science fiction author, activist, and blogger. He has a podcast, a newsletter, a Twitter feed, a Mastodon feed, and a Tumblr feed. He was born in Canada, became a British citizen and now lives in Burbank, California. His latest nonfiction book is How to Destroy Surveillance Capitalism. His latest novel for adults is Attack Surface. His latest short story collection is Radicalized. His latest picture book is Poesy the Monster Slayer. His latest YA novel is Pirate Cinema. His latest graphic novel is In Real Life. His forthcoming books include Chokepoint Capitalism: How to Beat Big Tech, Tame Big Content, and Get Artists Paid (with Rebecca Giblin), a book about artistic labor market and excessive buyer power; Red Team Blues, a noir thriller about cryptocurrency, corruption and money-laundering (Tor, 2023); and The Lost Cause, a utopian post-GND novel about truth and reconciliation with white nationalist militias (Tor, 2023).

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