In today's CMU Daily: Anthropic talks fair use and lyric regurgitation; live company DEAG is going on a shopping spree; you won't be buying any more Notorious BIG shower curtains any time soon; people are upset Spotify won't be launching on Vision Pro - but why would it?

Also today: Find out how we got Anthropic's Claude chatbot to spit out American Pie lyrics (it wasn't hard...)
Plus: What the RIAA's Mitch Glazier and Michele Ballantyne see for the organisation in 2024.

CMU's virtual masterclass Music + AI In 2024 takes place on Tuesday 20 Feb. Attendees can access the session live on Zoom and then on-demand via the CMU learning platform. Click here for information on all of the upcoming CMU online masterclasses and to book now before early bird pricing ends later this week.

Anthropic expands on its fair use defence in music publisher legal battle

AI company Anthropic last week formally set out a fair use defence in its legal battle with three music publishers, stating that using lyrics "to train an AI model, particularly one not technologically capable of outputting the texts of those songs going forward, is a classic fair use that does not constitute infringement of plaintiffs’ copyrights".

That statement was made as the AI firm, which is backed by Microsoft and Google, urged the courts in Tennessee to reject a request by Universal Music Publishing, Concord and ABKCO for a preliminary injunction that would impact on its chatbot Claude.

After suing Anthropic for copyright infringement in October 2023, the publishers then requested an injunction that would force the AI company to do two things. First, to ensure that their lyrics are not used to train any future AI models it develops. And secondly, to ensure that the current iteration of Claude doesn’t spit out any lyrics owned by the music companies.

Anthropic deals with those two requests separately in its response to the court. The fair use defence is relevant to the first part of the injunction. The copyright industries, including the music industry, argue that training a generative AI model with existing content requires permission from relevant copyright owners. Therefore Anthropic is liable for copyright infringement, because it trained Claude with lyrics without a licence from the publishers.

However, many tech companies counter that AI training constitutes 'fair use' under American law, meaning no permission is required. Continuing, Anthropic's latest legal filing says:"Relying on the fair use doctrine, courts have consistently found that making ‘intermediate’ copies of copyrighted materials to develop new technologies does not violate copyright law".

On the second part of the injunction, Anthropic argues that no court intervention is necessary, because it doesn’t want Claude to provide users with any lyrics that are owned by the music companies. After all, it adds, the "purpose of training on data including songs is not to reproduce the lyrics themselves, but to learn general ideas and concepts about how language works, in all its forms".

The publishers have claimed that if a user prompts Claude to provide lyrics to songs they have published - including ‘American Pie’, ‘What A Wonderful World’, ‘Moves Like Jagger’ and ‘Uptown Funk’ - the chatbot "will provide responses that contain all or significant portions of those lyrics”.

However, Anthropic says in its new filing that since the publishers instigated their lawsuit it has voluntarily "built additional safeguards to prevent display of plaintiffs’ works", which means “it is unlikely that any future user could prompt Claude to reproduce any material portion of the works-in-suit”.

That said, when CMU provided some simple prompts to Claude it still regurgitated some key elements of the publishers’ lyrics. You can see more about those tests here.

Anthropic previously responded to the music companies’ lawsuit last November, but that initial response mainly focused on jurisdiction issues.

The publishers have gone legal in Tennessee and Anthropic argues that the litigation should be fought in California, where it is based, and where many of the other lawsuits testing the copyright obligations of AI companies have been filed.

See how we got Anthropic's Claude to regurgitate lyrics from American Pie in back October - and yet again today

Anthropic says ‘lyric regurgitation’ is a bug, and it’s put safeguards in place to prevent it happening. In October we got Anthropic’s chatbot Claude to regurgitate key lyrics from ‘American Pie’. Three months later, it’s still doing it

In October 2023, in light of the news that music publishers had filed a lawsuit against Anthropic, CMU conducted a (very) simple experiment with the AI company’s chatbot Claude. Could we get it to reference copyright protected lyrics by asking it to write a song?

ATC Management // Day-to-day Manager (London)

Full Time Hobby Music // D2C Marketing Assistant (London)

Como No & La Linea // Director (London/Hybrid)

UK Music // Chief Executive (London/Hybrid)

Deviate Digital // Digital Marketing Assistant (London)

ONE LINERS

Kygo x Ava Max, Shaun Ryder, AVA London + More

DEALS

HarbourView Equity Partners has acquired a selection of song and recording rights from Jeremih. "Jeremih's hit songs - including ‘Oui’, ‘All The Time’ and ‘Don't Tell Em’ - experienced far reaching success, transcending global audiences and cultures, and paved the way for a new generation of R&B artists”, says CEO Sherrese Clarke Soares.

Sports event music licensing company ClicknClear has signed a deal with Warner Chappell to access its catalogue. At the same time, it has expanded the sports it works with via two new agreements with the International Gymnastics Federation and International Skating Union. "To be able to simultaneously announce partnerships with one of the world's most successful music publishers and two prestigious global choreographed performance sports is a strong validation of our technology platform, the quality and dedication of our team, and the momentum behind our business”, says CEO Chantal Epp.

APPOINTMENTS

Primary Wave Music has hired Agnes Kacicki as Head Of Corporate Development. She joins from the investment banking division at RBC Capital Markets. “Agnes has been a close adviser to Primary Wave for many years in her senior role at RBC, she will make a very significant impact on our ability to increase our acquisition capabilities, and service our partners”, says CEO Larry Mestel.

South Korea’s Kakao Entertainment has promoted Kisu Kweon and Joseph Chang to become co-CEOs of the company. “We feel a great responsibility as we take on leadership during these pivotal times”, they said in a joint statement. “Our priority is to contribute to and meet the expectations of society going forward. At the same time, we are dedicated to proving Kakao Entertainment’s full potential in the global market”. Kakao was involved in a high profile bidding war with HYBE last year for control of SM Entertainment, which subsequently resulted in allegations of misconduct being made against the Kakao company.

LABELS

One Media iP has launched a new vinyl reissues label called The Carolean. "The hunger for physical product - vinyl in particular - among music fans is something we’ve been tracking for several years and we believe it’s a niche now worth exploring”, says the company in a statement. “One Media is still, at its core, a digital record company and distributor: we were the first to acquire and exploit digital rights in 2005 – long before the major record companies and hedge funds - and 95% of our revenue comes from streaming. But, like most other music fans, we have a soft spot for 33s and 45s, and now there’s a genuine business case to ‘get physical’!”

MANAGEMENT

Applications have opened for the Music Managers Forum’s sixth annual Accelerator Programme For Music Managers, supported by YouTube Music. Participants receive grants of up to £12,000, music industry training, and a two night retreat focussed on leadership skills and commercial planning. The deadline for applications is 26 Feb. Find out more here.

EVENTS

Electronic music conference AVA London is set to return in venues around the capital from 29 Feb to 2 Mar. Speakers include Charli XCX, Brian Eno, Laurent Garnier and more. Find out more here.

Youth Music NextGen and Young Guns Network will host an event titled ‘Big Impact, Small Budget: Marketing For Artists’ on 30 Jan at the London HQ of AWAL. Find out more here.

ARTIST NEWS

A Shaun Ryder biopic based on the Happy Mondays frontman’s autobiography ‘Twisting My Melon’ is in jeopardy after one of its backers pulled funding due to a creative dispute with director Matt Greenhalgh. “We got the money, half-English, half-American and Matt fell out with the Americans”, Ryder tells Classic Pop. “They didn’t want to make the film that Matt wanted to make … So the American money went and it all [got messed] up really. Matt’s still working on getting it made, so that’s where he is now”.

GIGS & FESTIVALS

The Eagles have announced a three night residency at Manchester’s Co-op Live arena on 31 May, 1 Jun and 4 Jun as part of their farewell tour. Support will come from Steely Dan.

Alkaline Trio have announced UK tour dates in July, including a performance at the Kentish Town Forum in London on 26 Jul. The band’s new album ‘Blood, Hair, And Eyeballs’ is out this week.

RELEASES

Kygo has released new single ‘Whatever’ featuring Ava Max.

K-pop group (G)I-DLE have released new single ‘Wife’. Their new album ‘[2]’ is out on Friday.

Laura Jane Grace has released new single ‘Birds Talk Too’. New album ‘Hole In My Head’ is out on 16 Feb.

Rotting Christ have announced that they will mark their 35th anniversary this year with the release of their fourteenth studio album ‘Pro Xristoy’ on 24 May.

DEAG to re-list shares on Frankfurt exchange and raise €50 million for live industry shopping spree

Berlin-based live entertainment group DEAG has announced that it will re-list its shares on the Frankfurt stock exchange in the first quarter of this year, “subject to market conditions”.

Speaking about the proposed listing of the company’s shares, Detlef Kornett, co-CEO, said that DEAG believes there is “enormous growth potential in our business… the road ahead of us is paved with opportunity”, highlighting the company’s “recurring revenues from over 30 festivals, [and] intellectual property created from children’s musicals to light trails”.

DEAG is the owner of UK live promoter Kilimanjaro, Inverness music festival Belladrum, Nottingham-based Gigantic and ticketing company MyTicket.co.uk, and a range of other live music businesses across Europe.

In January 2021, in the midst of the live industry shutdown caused by the global pandemic, DEAG’s largest shareholder Apeiron Investment Group led a syndicate of investors representing a 47% stake in DEAG that pushed for the company to de-list from the public stock market, offering to buy out other shareholders to enable the move.

Having stabilised and grown during its period of private ownership, DEAG now has revenues of over €325 million annually and has, according to the “re-IPO” shareholder prospectus, completed over twelve acquisitions since going private in 2021.

As part of the Frankfurt listing the company says that it will “re-segment” its business into two divisions - Live Entertainment and Ticketing And Services. That ticketing business has “over one million monthly users and over 820 content partners”, says DEAG, and has significantly increased the number of tickets sold through DEAG’s own ticketing platforms for DEAG-owned events.

As a result of the re-IPO, the company expects to raise between €40 million and €50 million. It says that this money will be used to “further accelerate” its “Buy & Build acquisition strategy”, which will see the company go shopping for “high margin ticketing businesses” and other opportunities.

That “Buy & Build strategy” has seen the company’s M&A team complete 37 acquisitions since 1999, with a target of five to eight acquisitions per year after the stock market listing takes place.

The year ahead: Mitch Glazier, CEO and Michele Ballantyne, COO of RIAA

As we head into 2024, CMU has been sitting down with the bosses of many of the music industry’s trade organisations to talk about their work, the key challenges faced by their members, and what to expect in the year ahead.

Today RIAA CEO Mitch Glazier and COO Michele Ballantyne discuss the organisation’s work around AI, including co-founding the Human Artistry Campaign, plus the recent Gold and Platinum Class Of 2023.

Notorious BIG estate settles publicity rights case over skateboards and shower curtains

A legal battle between the estate of the Notorious BIG and photographer Chi Modu has been settled. The dispute was prompted by photos of the late rapper being used on skateboards and shower curtains.

Legally speaking, the case centred on the increasingly topical issue of publicity rights. Modu took photos of the late rapper - real name Christopher Wallace - in front of New York's World Trade Centre in 1996. In recent years those images have been used on various products, including snowboards, skateboards and shower curtains, and as part of an NFT drop.

Modu owned the copyright in the photos. However, Wallace's estate argued that using the images on products of that nature also exploited the rapper's publicity rights and, to that end, they filed a lawsuit in 2019. Modu then died in 2021, but the litigation continued with his estate as defendant.

According to Billboard, in June 2022 the judge overseeing the case concluded that Wallace's publicity rights likely were being infringed by the products that featured Modu's photos. The judge did confirm that - as the copyright owner - the Modu estate could sell prints and digital copies of the images, but said that using those photos on merchandise products likely required permission from the Wallace estate.

With that in mind, the judge issued a preliminary injunction against the Modu estate. However, the legal battle continued and was due to get to trial next month. But a filing with the court last week confirmed that a settlement has now been reached.

A legal rep for the Wallace estate, Staci Jennifer Trager, told Billboard: “Pictures of Christopher cannot be commercially exploited without a licence from our client. The settlement agreement is a testament to the dedication of our client as well as our team members in staying the course over several years".

Publicity rights - sometimes called personality, image or likeness rights - have been in the spotlight recently in the context of AI, because it is hoped they will allow artists to control the use of their voice, including in AI-generated vocal clones. However, these rights are also important for artists seeking to control the use of their image on merchandise, especially when - as in this case - third parties own the copyright in photographs in which they feature.

UK law doesn't currently provide any publicity rights. Although when it comes to merchandise, artists can sometimes rely on the legal concept of passing off.

In 2015, Rihanna successfully sued Topshop over its sale of t-shirts featuring her image. The retailer had licensed the use of a photo of the musician from a photographer, but Rihanna successfully argued that customers would assume she had endorsed the t-shirts, and therefore Topshop was passing off unofficial clothing as official merchandise.

However, passing off does not provide all the same protection as publicity rights. As a result, and especially with the increased interest in AI-generated vocal clones, many in the UK music community are now calling for a publicity right to be introduced into UK law.

CMU GUIDE: AI + MUSIC

Artificial intelligence + the music business: CMU's guide to (nearly) everything that mattered in 2023

There was a lot of discussion in 2023 within the music community about how AI will impact on music creation, music marketing, and the music business more generally.

There are clearly opportunities created by AI, and many ways that AI technologies will enhance the business.

An increasing number of music creators and music companies are exploring and identifying way to capitalise on those opportunities, and figuring out which AI products and services may offer ways to enhance their work.

Read CMU's (very) deep dive guide to the deals, disputes and debates, lawsuits and lobbying, and innovation and exploration that informed the conversation.

Spotify won’t be launching on Vision Pro and lots of people are surprised - but why would an audio company invest in a primarily visual platform?

Who won’t be launching on Vision Pro when Apple's mixed reality headset goes on sale next month? Spotify, that’s who. But then given their recent expensive experiments with podcasts and a long history of lacklustre video products, that’s probably not such a bad thing.

The music service is not the only digital content platform holding back on launching a bespoke Vision Pro app. Both Netflix and YouTube have confirmed to Bloomberg that Vision Pro users will have to use the device's built-in web browser to access their platforms.

Netflix said in a statement: “Our members will be able to enjoy Netflix on the web browser on the Vision Pro, similar to how our members can enjoy Netflix on Macs". A spokesperson for Spotify confirmed that it hasn't announced any plans to develop a Vision Pro app, but declined to comment on whether such a thing might be considered in the future.

While Spotify has a high profile and ongoing beef with Apple over in-app payments, that is unlikely to have impacted on any decision making around developing a Vision Pro app. If the music service saw a significant commercial opportunity in creating an app for Apple's headset, it would pursue that opportunity.

However, Vision Pro is primarily designed for immersive video content, making it less of a priority for audio-centric platforms, especially in the early phase when consumer interest in such products and experiences is still to be tested.

Although Spotify has dabbled with video content over the years, those dabblings have always been on the periphery and somewhat lacklustre. And the company is currently focused on reducing its overheads - having spent heavily in recent years on its expansion into podcasts and audiobooks - so it won't want to invest in developing new experimental video products.

Indeed, after wide ranging layoffs just weeks before Christmas - which saw it make more than 1500 people redundant as part of that bid to save money - it’s unclear whether Spotify would have the engineering resource, or desire, to develop and maintain yet another app on yet another platform.

Future moves in this domain may be influenced by whether or not the music industry sees an opportunity in creating immersive video content.

The new iPhone 15 Pro and 15 Pro Max can be used to record spatial video giving creators a (relatively) affordable way to create spatial video content. That will allow independent creators to innovate in this space, meaning indie artists and labels could get a head start on the major players and be first to capitalise on the creative and commercial opportunities if Vision Pro really takes off. And, indeed, those innovators in the independent sector could then influence the spatial video strategies of the majors and streaming services.

Various American broadcasters and sports leagues have developed bespoke apps for Vision Pro, as have Amazon, TikTok and Disney. A company with long ties to Apple, Disney will make 3D content available via its Disney+ Vision Pro app from launch.