Is Morality Even A Question In Copyright?

from the and-should-it-be? dept

I've explained in the past why I think it doesn't make much sense to include a moral argument in discussing things like copyright law. If you can structure things such that everyone is better off, then morality shouldn't even come into play at all. My focus, then, is on setting up systems that do tend to benefit everyone, so there isn't a moral question at all. If even the content creators are better off under certain systems, then where is the moral question? The problem, of course, is that it's often not the actual content creators whose livelihoods are at stake. Instead, it's various middlemen who have worked themselves into a certain position. But arguing that they need to prop up their own obsolete business model isn't very interesting, so they tend to play the morality card, claiming that a system where content is given away for free has some sort of negative moral component. That's hogwash.

William Patry recently did a series of posts over at The Volokh Conspiracy, and addressed this issue as well, concerning copyrights and morality, where he noted:

Morality is used in the Copyright Wars as a way to cover up the inability to justify expansion of rights on economic grounds.

Indeed. Since copyright is intended as an economic right (as detailed and cited in Patry's post), the arguments over copyright need to focus on the economic issues. And a properly calibrated system is one where there's the greatest overall economic good and everyone has the greatest opportunity to benefit. At that point, where's the morality question at all? The answer is that there isn't one. Claiming morality in an economics discussion on copyright is a crutch used by those who can't support their position. There is no moral issue at all.

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Myth Debunking: Fans Just Want Everything For Free

from the except-when-they-don't dept

The debate between Ben Sheffner and William Patry continues over at Patry's blog, and Sheffner has an interesting piece where he argues (delicately) that sometimes the customer isn't right. He admits upfront that this is a tricky position to defend, and he starts out with a more nuanced view as to why that is, but then he gets to this:

So everyone wants the product -- but too many don't want to pay for it. Hell, I don't want to pay for it. I would love it if I could get all the movies and music I want for free. And I would love it if I could get all the BMWs, houses in the hills, and meals at Urasawa I want for free as well. But of course I realize I can't. Just about everyone is with me on the BMWs and houses part. But too many think that movies and music should be free, and don't see anything wrong with taking them. I'm willing to say they're wrong.

Everyone understands why they can't have all the physical goods they want for free. But they have a much harder time understanding that with intangible goods like movies and music. IP is just harder to understand, and to explain, than physical property. We need theories to undergird it, special laws to define it, and special classes at law school to learn how to fight over it -- not to mention eight-volume treatises to tell us what the law actually is. So when people commit copyright infringement, they may think they're causing no harm -- but they are. They're undermining a system that enables those big, bad companies that everyone loves to hate, to finance the movies and albums that we all love.

This is a myth. It's a popular myth, and I'm quite sure that Sheffner and lots of folks on both sides of the debate think its entirely accurate. But it's a myth. The nature of a good economic transaction is one in which both parties are better off after the exchange. That means the people "paying" don't mind paying. They're happy to pay because they believe that what they have received is better than the cost it took to acquire it. But basic economics plays into the situation here: if the same thing can be made available by others in a better way, it's only natural for people to ask why they should have to pay.

But if you want real proof that there's a lot more at work than the idea that consumers just want everything for free and think that if it's not free they should just take it, look no further than the countless examples we've shown of people paying lots of money to support those providers who don't treat their fans as criminals, who don't try to prevent what the technology allows and who actually work to connect with those fans and give them a true reason to buy.

Everyone wants a good deal, and a fair deal, but people are more than willing to pay if it makes economic sense. Whether consciously or not, there are an awful lot of people who inherently recognize that the economics don't make sense when a good is infinitely available. As much as people have trouble understanding explicit economic concepts like supply and demand, instinctively many do, in fact, understand the very nature of abundance and what it means for pricing. It's not some nefarious story of a bunch of immoral "thieves" wanting stuff for free. It's an inherent understanding of competitive markets.

On top of that, Sheffner takes the position that paying for these things is necessary, because not paying for them "undermines the system," he is once again being misleading. It may undermine one particular way that the system works, but the false statement is implicit in his argument: that this is the only way of funding such creation. That is demonstrably false, as we've shown time and time again. I have no doubt that Sheffner is sincere in his argument, but it's based on a false premise that because the system used to work one way, back before technology changed the basic economics it relied on, that somehow we should all suffer by limiting what the technology allows and by ignoring basic economics.

It would be nice if it were possible, but I cannot find a single example of a modern society being able to successfully hold back or ignore what technology allows when it comes to economics.

Finally, way back when I was in high school, I worked at a bagel shop, which also sold other baked goods. The boss's position was that "the customer is always right" except for one particular issue: the customer could only get the next piece of coffee cake in order. We had this giant sheet cake coffee cake, and many customers didn't want "end pieces," and would ask for middle pieces instead. On more than one occasion, this resulted in angry customers stomping out -- and even once resulted in a fist fight between a customer and the owner's son. Over time, as more competition entered the neighborhood (a Dunkin' Donuts across the street, another bagel shop a block away), we lost a lot of business for our baked goods.

The point, which should be clear, is that you can say the customer is wrong all you want. But, in the end, the market will decide that the customer is right. Always. If you don't provide what the customer wants (a fair transaction) and others are able to do so, you will suffer.

The movie industry and the music industry both have had numerous opportunities to embrace what the technology allows -- and to craft new business models that would be massive money makers in doing so. They have chosen not to do so. They have said that the customer is wrong, and, as Sheffner notes, they have no problem saying so. The problem is that, whether legal or not, the competition is springing up left and right. Sheffner and his former colleagues can stand on whatever principles they want. The market doesn't care. The market only cares for those who serve the customers' needs. Plenty of others are doing so (both legally and illegally). Those who want to survive in business would be smart to take lessons from those who are succeeding and looking to implement smart business models around them. Those who want to insist that "the customer can be wrong" may feel good when they look in the mirror, but they're going to have to contend with a rapidly diminishing customer base.

The customer can be wrong, but focusing on that doesn't get them to pay you.

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Protecting Yourself From Consumers Is Not A Recipe For Success

from the if-you-do,-you're-making-a-mistake dept

William Patry continues to use his new blog to make some great points that bear repeating. In a new post discussing Theodore Levitt's "marketing myopia" concept (something I believed in long before someone showed me Levitt's work), he points out how the industry seems to miss this basic point: that it's not selling "property" to people, but a benefit the customer wants. If something else better satisfies that benefit, customers will go there. From there, he points out that the entertainment industry is way too focused on property, and acts as if copyright is there to provide a special protectionist plan for them alone:

I believe that too many companies in the copyright industries appear oblivious to the very idea that consumers have needs; to them, consumers are passive purchasers of what those companies decide to sell. And if they decide not to sell at all, too bad; that's their prerogative as a property owner. Copyright is the method by which control over consumers is achieved (or the decision not to sell is enforced). Copyright owners' adoption of control as their principal business model results in closed systems, in which copyright owners try to tightly control everything connected to their works: which play back devices will be offered to the public; what types of access controls will be interposed before consumers can ever see, hear, or in the case of books or other literary works, even read a snippet of the work; the time period during which consumers will have access to the work; how many times can consumers see, hear, or read the work; in what format will consumers be able to access the work; what will they be able to do with the work once they finally access it.

Copyright owners speak of this control as protecting their property (the subject of next week's blogs), but once your focus is on protecting yourself from your customer, you are in deep trouble. The government did not grant a monopoly in order to simply horde it: copyright is not a TARP fund. There is a huge divide in perception on this point: when copyright owners succeed in enjoining, shutting down, or crippling services that give consumers what they want, e.g., MP3.com, Launchcast, or RealDVD software, copyright owners see a threat removed, but consumers see an industry determined to thwart their desires. (I do not speak here of those who want simply to copy works as a substitute for paying for them). When is the last time (or maybe even a first time), copyright owners lobbied Congress for greater consumer access to their works, or sued to increase such consumer access?

This perception gap is huge and is critical to understanding the divided nature of the Copyright Wars. Control is seen as essential by the content industries, while consumers see it as a dagger through the heart of the very reason for copyright. All businesses should be free to commit suicide by putting their interests ahead of their customers (unless they are financial institutions, apparently, or insurance companies operating as hedge funds), but they should die on their own and not stay propped up a government granted monopoly.

Great stuff, as per usual from Patry. In the post, he also discusses how he, too, at one point (when he worked at the Copyright Office) was pulled by this sway of control, as he was among those who pushed to add protections for building design, but was eventually convinced otherwise by a colleague, who pointed out that copyright wasn't the reason new buildings would get built.

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Patry: It's Not Copyright That Creates Value, It's Consumers' Willingness To Buy

from the indeed dept

One of the great disappointments around here was William Patry's decision to (mostly) shut down his old blog about a year ago. His contributions to the discussions on copyright were incredibly valuable, and the loss of his voice in the debates left a huge void. In part, it's why I was thrilled to read his book (which, yes, is available as a part of our Book Club), as it reminded me again of Patry's insight on these subjects. I'll be posting a full review of his book next month, but I was going to say that it was certainly a must read for those who missed the blog... However, with the book almost available, even better news came about, as he recently launched a new blog related to the book.

On it, he's hosting a back-and-forth discussion with an entertainment industry lawyer who disagrees with him, Ben Sheffner, which goes into the same discussion we had last week concerning Sheffner's highly questionable claim that the jury rulings against Tenenbaum and Thomas somehow represent the views of everyday people on copyright. In that ongoing discussion, Patry does a nice job highlighting how the entertainment industry keeps trying to kill off innovation and protect its old business models via copyright while failing to do the one thing it should have done all along: build a real business with new business models that embrace the changing market:

I don't deny the RIAA was entitled to bring all the suits it did (aside from the many false accusations of course), but the business of companies that want to sell mass market goods to consumers is not suing those consumers. The business of the RIAA may be doing that because it has to justify its own existence, but the business of business is business, not litigation. One would never know that from the industry's reaction to virtually every new digital technology that has come along; for example, the suit against MP3.com over storage lockers, and the eventual bankrupting of that company was, in my opinion, a terrible mistake and certainly anti-consumer. (I represented the defendant for awhile). There was no evidence that Mp3.com's security -- which required verification that the consumer had bought a legitimate CD -- had ever been broken; instead, the industry wanted to force consumers to buy multiple CDs of a work they had already bought, rather than letting them listen to it regardless of where they were.

The industry's suit against Launchcast, brought deliberately while it was being bought by Yahoo, was a similar anti-consumer suit. (Yes, I represented defendant there for awhile) too. Launchcast was engaged in the authorized streaming of music, in conjunction with intelligent software designed to learn consumers' test and that helped introduced consumers to new music. The service could never result in loss of sales; quite the opposite. The functionalities the industry objected to had nothing to do with violation of any rights remotely granted by the copyright act. There are many more examples in addition to MP3.com and Launchcast.

The industry's failure to offer any alternative after Napster isn't just a small oversight; in my view, when coupled with the industry's repeated suits against almost any business it had not authorized (read controlled), and the decision to send out massive cease and desist letters and suits against individuals, that failure is directly responsible for the highly negative attitude many people have toward the industry. The failure of the industry to provide a way for people to access legitimate product led consumers both to unauthorized product and to rightly conclude that copyright was the primary weapon being used to thwart consumers' desires. I really don't think these assertions should be controversial. I repeat that copyright doesn't create economic value, a statement that is not intended to disparage copyright; it is merely to state the obvious: it is only consumers' willingness to buy something that creates economic value.

Indeed. Read the whole thing and be sure to subscribe to the blog...

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Who Knew Discussing A Long Repealed Copyright Law Could Be So Interesting...

from the copyright-geeking dept

I wasn't at all sure what to expect yesterday when I went to a conference in honor of the 100th anniversary of the US's Copyright Act of 1909. After all, that law was superseded by the Copyright Act of 1976, and so it hasn't even been in effect for 33 years. However, the program was organized, in part, by Eric Goldman and Pamela Samuelson, and had some really big names on the speaker list, so I figured I'd at least check it out. Looking over the schedule, I figured I'd sit in on a few sessions and probably head out. However, the program actually turned out to be so interesting, that I stuck around for almost the entire thing (had to duck out for a bit at one point). Bill Patry joked that only a bunch of lawyers could get excited to discuss a law that was "repealed" 33 years ago, but what was so interesting was how much of the discussion was really about what's going on today.

The summary? Copyright law is so screwed up that even if you put a significant number of the top copyright scholars and students in an auditorium for a day, they'll disagree on almost everything, and only agree that the system is a total mess. Even simple questions like "how should copyright be handled on blogs" created a collective shoulder shrug, with everyone effectively admitting that copyright law has no answer for such basic questions. That should worry people. If the intention of copyright is to "promote the progress of science" then it shouldn't be so incredibly ambiguous and contentious. All in all, it seems to reinforce the point that copyright law has been stretched and twisted in so many different ways over the years, that it may be fundamentally broken. Basically, copyright law is adjusted every so often not based on any look at whether or not it actually promotes the progress, but based on whatever new technological innovation comes along that throws some legacy providers' business models into doubt. That industry freaks out, and politicians respond with some patch that protects that industry, but has little to nothing to do with actually promoting progress.

This goes all the way back throughout history. One speaker pointed out that the big innovation of the 1909 copyright was compulsory licensing on mechanical rights. This was put into place for one reason: fear about player pianos and how they would dominate the market and destroy the need for musicians. Within a matter of decades, the player piano market was effectively gone... and yet, these massive changes designed solely to deal with the player piano have stuck around ever since. Now apply that same story to basically every other technological innovation, and that gets you copyright law.

If there was a key theme running throughout the conference, though, it was on the single biggest change that the '76 Act brought into play: switching the copyright system from opt-in to everyone-automatically-in (not even to "opt-out" realistically speaking). In the terminology of copyright lawyers, in the '09 Act you had "formalities" to get copyright. In the '76 Act, you don't. While it was heartening to hear an awful lot of support for the idea of moving back to an opt-in system (i.e., if you want copyright protection, you need to proactively register/add a notice to get it, rather than automatically getting it on everything at the moment of expression), there was plenty of disagreement. Registrar of copyrights Marybeth Peters (who has a long history of supporting worrisome expansion of copyright law) kicked off the day by talking about why it was a good thing to switch to automatically in, because the old system resulted in too many questions about whether or not something was in the public domain.

Later on, Jon Baumgarten, who also participated in crafting the '76 Act, berated supporters of an opt-in system, saying that having practiced under it, it was only good for the lawyers, because everyone spent all of their time trying to determine ways to prove that someone had screwed up registering their copyrights, and thus the end result was lots of works accidentally fell into the public domain. On this last point, Peters concluded her remarks with the rather stunning statement "I'm so glad that copyright law no longer allows so much stuff to get into the public domain." (I'm paraphrasing the exact statement, but it was close... hopefully video will be up shortly and I can get the exact quote).

Think about that for a second. Yes, the context is important: her problem was mostly with items getting into the public domain because of confusion in the registration process, but it suggests a mindset that says "the public domain is bad." Later speakers pointed out that the difficulty of putting a copyright on creative works was actually a feature of the system, intended by the Founding Fathers to be difficult on purpose, because they believed how important it was to have a large and fruitful public domain.

Also, what was stunning was how much the "old guard" such as Peters and Baumgarten insist that an opt-in system can't work because it was such a mess under the '09 Act. They seem to be confusing the '09 implementation with the entire idea of opt-in. Sure, things were a mess before '76, but perhaps the problem was with the specifics of the "formalities" rather than with the concept itself. And, they don't even seem to acknowledge that modern technology could (and, in fact, should) change the entire thinking around copyright and how any sort of registration/opt-in process might work. And, in fact, David Nimmer's final keynote suggested that new technological solutions (he discussed a hypothetical system amusingly named "the panopticon") has shifted his thinking from being totally 100% against formalities to now believing that an opt-in system absolutely makes sense.

This post is long enough, even though there were plenty of other interesting discussions, but I did want to bring up three separate points that were interesting:

• Bill Patry (whose blog is seriously missed) tried to hammer home the point that it's absolutely ridiculous that Congress doesn't ever look at copyright law in terms of whether or not it promotes the progress, and totally trashed anyone (including Supreme Court Justices) who seem to think that the "to promote the progress..." part of the Constitution is meaningless preamble, even noting that in 1909 the legislative history made it quite clear that anything that did not promote the progress was outside the scope of Congress's power. It's sad that both Congress and the Supreme Court now seem to ignore this point.
• International trade agreements are evil when it comes to copyright. Sorry, but it needs to be said. There was a lot more talk about whether or not certain changes in copyright law would keep us in line with either the Berne Convention or TRIPs (and soon, ACTA!) than about whether or not it made sense. Basically, these trade negotiations, often pushed by industry reps without considering consequences for the public, have locked us into a narrow range of bad options. We simply can't do what's best for society and creativity, because we agreed to be bound by some really bad trade agreements. No wonder the industry loves them. They get to put a stranglehold on pertinent discussion (does this promote the progress?) and force people into discussing something entirely separate (does this violate our trade agreements?). It gets everyone focused on the trees and missing the forest.
• There's a lot of bubbling concern about conflicts between copyright law and the First Amendment. I'd mentioned how often this issue seemed to be coming up lately, and this event was no exception. While the old guard again insists this matter is settled and there's absolutely no conflict between the two, a large number of scholars disagree, and point out that it's a big open question, and some earlier rulings conflict and leave open some big loopholes to be challenged in court. Expect this issue to get a lot more play in the coming years.

All in all, a very interesting event that generated lots of thoughts and discussions.

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YouTube Tells McCain He Doesn't Get Special DMCA Treatment

from the change-the-law-and-we'll-talk dept

Earlier this week, we pointed out the letter the McCain campaign had sent YouTube concerning observing fair use before complying with takedown notices on political videos. As we noted at the time, the problem with the situation wasn't with YouTube, but with the DMCA (which McCain voted for, by the way). Now, YouTube's Zahavah Levine has responded to the letter, and made the same point. YouTube won't change its practices because that would be granting special privileges to the campaign rather than everyone else. Instead, YouTube hopes that McCain will help fix the law so that this isn't a problem going forward:

While we agree with you that the U.S. presidential election-related content is invaluable and worthy of the highest level of protection, there is a lot of other content on our global site that our users around the world find to be equally important, including, by way of example only, political campaigns from around the globe at all levels of government, human rights movements, and other important voices. We try to be careful not to favor one category of content on our site over others, and to treat all of our users fairly, regardless of whether they are an individual, a large corporation or a candidate for public office.

The real problem here is individuals and entities that abuse the DMCA takedown process....

We look forward to working with Senator (or President) McCain on ways to combat abuse of the DMCA takedown process on YouTube, including by way of example, strengthening the fair use doctrine....

This is the right response. As problematic as the takedown process is, the answer should be to fix the law -- not make special exceptions for politicians.

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McCain Campaign Sends Letter To YouTube Defending Fair Use

from the what-the...? dept

This is impressive, and somewhat unexpected. It's rather rare to see politicians (other than maginal ones, at least) showing any sort of recognition of fair use. It's certainly not an issue you'd expect to see raised by a presidential candidate (of either party). However, John McCain's campaign has sent a letter to YouTube complaining about the site's unwillingness to consider fair use in videos before taking them down. You can read the whole letter at that link or below (if you're not reading via a feed):

The letter basically notes that YouTube seems a bit too fast on the trigger in pulling down content based on DMCA takedown notices, in part parroting the some of the recent ruling where a judge said that those sending DMCA notices need to at least take fair use into consideration. Of course, that was directed at the sender of the DMCA takedown notice, not the recipient, as in this case. I'm sure the McCain campaign recognizes that YouTube is completely within its legal rights to automatically pull down the content, but in sending this letter the campaign is suggesting that, specific to videos put up by either political campaign (the letter cc's the Obama campaign), that YouTube take into account fair use.

The letter is addressed to YouTube's founder, Chad Hurley, as well as Google's Senior Copyright Counsel, William Patry (who we've talked about and quoted here many times) and Zahavah Levine, who is General Counsel for YouTube, who I've met and spoken with in the past. Both Patry and Levine are well aware of the legal issues here (probably better than just about anyone else), so it will be quite interesting to see how they respond. The real issue here has almost nothing to do with Google/YouTube -- but with the way the DMCA itself is structured. Since it provides clear safe harbor for a recipient of a takedown notice if they take down the content, it's a reasonable business decision to simply take down the content and then follow the proper procedures for letting the uploader file a response notice.

While it certainly would be nice for YouTube to take into account fair use before deciding whether or not to pull down the content, the real problem is with the law itself, and the incentives it puts in place for any recipient of such a letter. If the McCain (or Obama) campaign were really concerned with that, they should not just ask for this special exception to YouTube's official policies, but should promise to push for a change to the DMCA that makes an explicit point that recipients of such takedown notices shall retain their safe harbor protections even if they refuse to take down content, if they have a reasonable belief that the content in question is being used in accordance with fair use rules.

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Copyright Expert William Patry Shuts Down Blog, As It's 'Too Depressing'

from the sad-day dept

It was really disappointing, if entirely understandable, earlier this year when the until-then-anonymous "Patent Troll Tracker" had to shut down his blog. Prior to that, it had been one of the only sources (and in some cases the only source) to report on some important cases and trends in the patent world. Unfortunately, it appears the same thing is now happening in the copyright world. William Patry, recognized around the world as an expert on copyright, has shut down his blog. Tragically, he didn't just stop writing it, he's deleted the entire archive -- so even posts of his that we pointed to just last week no longer are live. This is really unfortunate -- and there seems to be no reason he couldn't have allowed the archives to live on.

As for the reasons for shutting it down, his first is that he was sick of people taking the word on his personal blog as the position of Google, since he works there. When he started the blog, he did not work there, and since he joined the company he was quite explicit about that fact and never commented on cases or stories that involved Google or even other cases involving companies involved in lawsuits against Google. However, too many people would take what he said as the "word of Google," unfortunately.

Much more importantly, however, he notes that writing about the state of copyright these days has become "too depressing." This should really open some eyes. Patry has always been a supporter of the copyright system. But he's become depressed with how the system has been changing, such that he finds himself constantly writing about changes or abuses of the system. Even (as he puts it) being a "centrist" on copyright issues, he's seen how far in one direction certain interests are trying to pull copyright, and it means he's constantly pulling hard in the other direction, making him seem less like a centrist and making him depressed for having to write so negatively about things happening in the copyright world.

Copyright law has abandoned its reason for being: to encourage learning and the creation of new works. Instead, its principal functions now are to preserve existing failed business models, to suppress new business models and technologies, and to obtain, if possible, enormous windfall profits from activity that not only causes no harm, but which is beneficial to copyright owners. Like Humpty-Dumpty, the copyright law we used to know can never be put back together again: multilateral and trade agreements have ensured that, and quite deliberately.

It is profoundly depressing, after 26 years full-time in a field I love, to be a constant voice of dissent. I have tried various ways to leaven this state of affairs with positive postings, much like television news shows that experiment with "happy features." I have blogged about great articles others have written, or highlighted scholars who have not gotten the attention they deserve; I tried to find cases, even inconsequential ones, that I can fawn over. But after awhile, this wore thin, because the most important stories are too often ones that involve initiatives that are, in my opinion, seriously harmful to the public interest. I cannot continue to be so negative, so often. Being so negative, while deserved on the merits, gives a distorted perspective of my centrist views, and is emotionally a downer.

This should be a huge downer for everyone else as well. While Patry and I disagreed about the extent of reform needed in copyright, he is one of the sharpest minds on any issue having to do with copyright, and having him silence himself means that the forces he was sick of fighting -- those who are constantly stretching and abusing copyright -- have just won yet another battle. That makes it that much harder for the rest of us to stop certain industries from continuing to stretch, twist and abuse copyright, not for good reasons, but merely to prop up their own obsolete business models. One hopes that others in the field will step up and help prove to Patry and others that this isn't too depressing -- and that this is a battle that can be won -- but no one will be able to fully replace his regular insightful opinions on the subject.

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Copyright Battles Are About Controlling New Technologies

from the seems-like-it dept

Copyright guru William Patry has a really interesting post remembering Harvey Schein, the man who oversaw the American launch of the Betamax VCR as head of Sony's American division. That was, of course, the product that produced the famous Sony decision upholding the legality of the VCR and its "record" button. The Betamax precedent is widely seen as a foundation of the modern consumer electronics industry because it gives manufacturers confidence that they can build useful media tools without worrying about liability should their customers use the tools to infringe copyright.

Patry mentions an aspect of the case that I hadn't realized before: MCA/Universal, the lead plaintiff, wasn't just worried that the VCR owners would tape shows rather than watching re-runs. It was also planning to release a laser disc technology called Disco Vision. MCA/Universal apparently worried that a successful Betamax VCR would have undercut the market for laser discs. Schein is quoted as saying "I don't think it was accidental that the company that took the lead in fighting the videocassette held all the patents on the videosdisc."

This will sound eerily familiar to anyone familiar with more recent copyright controversies. For more than three decades, Hollywood and the recording industry have consistently tried to use copyright law to stop any technology they didn't control. In 1992, the music industry persuaded Congress to mandate cumbersome DRM for digital audio formats, stunting the development of that technology. In 1998, the music industry unsuccessfully tried to sue the MP3 player out of existence. Also in 1998, at the behest of the copyright lobby Congress enacted the DMCA, which gave content creators unprecedented control over the design of technological devices. Hollywood has used the DMCA to effectively outlaw set-top boxes that act as DVD jukeboxes.

Of course, in every one of these cases, the copyright lobby's arguments have focused on the threat of "piracy." But when they've won, the practical result has been to give content creators the power to control the evolution of media devices. And when Hollywood and the record labels control technological progress, the results aren't pretty.

Timothy Lee is an expert at the Insight Community. To get insight and analysis from Timothy Lee and other experts on challenges your company faces, click here.

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Recording Industry Testing Out New Theory: It Deserves More Money Because It Lets You Transfer Music

from the the-audacity-of-greed dept

William Patry has a long, but fascinating, discussion on the latest trick being used by the recording industry to try to squeeze more money out of you: telling governments that because it's now willing to let people transfer the music they legally purchased between devices, it deserves extra money for it. To back this up, it's claiming that there's obviously value in being able to transfer music around, otherwise why would people want that ability. The audacity of such a statement from the industry shouldn't be understated. After all, this is the same industry that has, for years, ignored pleas from fans all over the world to get rid of DRM because it would make digital files increase in value. And, now, that the industry has finally been forced to recognize this, it seems to be claiming that all of the value belongs to the industry itself, and it's the government's job to hand over that "value."

The reasoning for this seems to go back to the psychological explanation for why the recording industry keeps getting itself into trouble (and it's similar to the story we had recently about bloggers worrying about a new aggregator). They assume that all of the "value" needs to be captured by them, and not anyone else. In economics, this is effectively an industry telling the government that it needs to be compensated for all of the positive externalities it created -- even if it's better off at an absolute level. Basically, the industry is so overvaluing its own content, that it assumes that any additional value that people get out of music, even if it's through no effort of the recording industry itself, should be entirely converted to more revenue for the industry. As an analogy, it's like your automobile maker demanding an ongoing cut of your salary, since without the automobile, you wouldn't be able to drive to work. Unfortunately, though, unless you're a copyright wonk, you might not even notice that the recording industry is trying to do this. Instead, it presents its case in a logical fashion, focusing on how much "value" it's suddenly creating by "allowing" people to transfer the music they already legally purchased to the device of their choosing.

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Is A Photograph A Derivative Work Of The Object In The Photo?

from the you-would-hope-not dept

There's an interesting discussion going on over at William Patry's blog, questioning whether or not a photograph should be considered a "derivative work" of the object or objects in the photo. The courts appear to be somewhat split on this. The importance of this concerns whether or not the photograph itself can be covered by copyright -- and also whether or not the photograph can be considered infringement itself. If the photo is considered an unauthorized derivative work, then it's entirely possible that whoever holds the copyright on the object in the photo could claim that the photo itself is infringing. Remember, in the past there's been some concern about the legality of photographing copyrighted sculptures. A derivative work is supposed to be for something that "recast, transformed, or adapted" the original work, and is normally used for something like a translation of copyrighted material. However, does a photograph really recast, transform or adapt the object? Or is it an entirely separate work?

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Pro IP William Patry Explains How Pro IP Bill Is Very Anti IP

from the up-is-down,-black-is-white dept

Last week, we wrote about just how awful Congress' proposed "PRO IP" law was, suggesting that it would help to kill off creative industries by giving excessive power to enforce obsolete business models. Of course, I'm somewhat skeptical about all intellectual property laws, as there's enough evidence out there that they're not needed in most cases, and only serve to distort markets in unnecessary ways (and there's very little evidence that they actually serve their purpose of creating incentives for the creation of new content). Thus, you would expect me to have problems with a bill that would drastically strengthen copyright, since that's clearly going in the wrong direction in my book. However, to get another opinion on the bill, why not listen to William Patry, a man who is clearly in favor of intellectual property laws, having been a copyright lawyer for 25 years, including representing copyright holders and various trade associations, as well as working in the US Copyright Office. He has written up a great piece explaining why the "PRO IP" bill is very "anti-IP" when you understand the details:

"The question is not whether copyright is a good thing: properly calibrated copyright is very good, indeed essential for certain classes of works. Sir Hugh and I are both pro-IP in this most important of senses. But an excessive amount of something that is beneficial in measured doses can become fatal in overdoses, and copyright is already at fatal strength. Yet, when they are not alienating their customers, copyright industries spend the rest of their time in efforts to obtain new, powerful, undeserved, and unnecessary remedies. Content owners act as if obtaining more and more and more will save them: it won’t, quite the reverse: it only continues an unfortunate trend of making copyright law and content owners among the most despised elements in society. While proponents of such efforts describe themselves as being pro-IP, they have the opposite effect by bringing disrespect on the entire system. I call that being anti-IP, not pro-IP."

And that's somewhat near the beginning of the piece. It's worth reading the whole thing.

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