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How To Prevent Copyright From Interfering With Innovation

As anyone who reads Techdirt regularly knows, copyright is a big issue around here -- with particular concern in how certain industries have used copyright law not for its intended and stated purpose (to promote the progress) but for exactly the opposite reason. It's been used time and time again as a weapon against progress and innovation, by industries who saw that innovation as a threat to their business model. In the 1980s, Hollywood tried to outlaw the VCR, declaring it "the Boston Strangler" of the movie industry. The reality was exactly the opposite. The VCR helped revitalize the movie industry and provided the fuel that grew the industry throughout the last two decades. Then, a decade ago, the music industry tried to kill the first MP3 players, again insisting that a portable MP3 player would destroy the music industry. Once again, they failed -- and once again, their own failure has helped to save them. A recent Harvard study found that the success of the digital music market has grown the overall ecosystem and resulted in much greater output in music.

But, still, the industry fights such advances, often using a variety of different tactics, including lobbying and lawsuits. On this front, they've been winning a lot more than losing lately, to their own detriment. Copyright has been extended and changed over and over again, now covering significantly more than it ever did and ever was intended to cover. And certain industries are using that to their advantage. In two recent court rulings, the Hollywood movie studios were able to prevent two different innovative products from hitting the market, since both involved making backup copies of DVDs. Even though these were both designed for perfectly legitimate reasons, both were banned, due to copyright or copyright-related issues.

Imagine how different the movie industry would be if the VCR were not allowed? Imagine how different the music industry would be today if the iPod was illegal? Yet, we're unable to know how different the music industry would be today if Napster has been allowed to live, and the industry had found a way to monetize via its platform. And now we likely won't be able to find out how the movie industry would be different if people could back up their movies legally (there are, of course, unauthorized options for both, but that, too, limits their ability to advance and innovate).

The Innovation Movement is an effort by the Consumer Electronics Association to make more people aware of such issues, and to make sure that Congress actually takes these issues into account, rather than just focusing on the patriotic headline while ignoring the unpatriotic results.

In this Insight Community Conversation, we're looking for thoughtful and well-written discussions on the importance of not letting copyright stand in the way of innovation. How can politicians better understand the negative impacts of certain industries using copyright to protect old business models and take away consumer rights? The copyright system supporters can always point to the past -- noting the successes of the industry and (often incorrectly) attributing it entirely to copyright. But it's hard for innovators to point to the future of what could be if they were allowed to innovate freely. We're looking for discussions on ways to better make this point to politicians, journalists, consumers and (yes) the very industries that have been fighting so hard to protect their old business models. Present a convincing argument on why innovation is key, and holding it back with copyright is bad for everyone. The best results will be used as posts on the Innovation Movement website.

18 Insights

 


Intellectual property rights are in place to encourage innovation by providing an economic incentive to create new works. Although politicians often support positions that are detrimental to this process, they do so because they hold an earnest belief that such laws are necessary to create an adequate incentive to innovate.

Politicians continue to hold these beliefs because they have never been honestly confronted with any alternative or even concern against the effects of stronger intellectual property rights. However this is not to say that these issues are not being adequately voiced to politicians, but rather that they have never given serious consideration to the issues being presented. This is probably best represented by the situation in Canada where although the issue of intellectual property has been brought to the forefront of political discussion, the response from elected officials has remained tepid at best.

I do not think it is impossible to make politicians understand the negative effects of strong intellectual property rights. Despite how some may feel, I do think that in general politicians enjoy the opportunity to represent the interests of their consituents when possible. However for most politicians the prospect of 'weak' intellectual property rights is currently classified as impossible. I expect that the perspective of most politicians towards the proponents of limiting intellectual property rights is that we are something like a hobbyist musician who works for Microsoft. On one hand we lobby to gain the right to mix music freely, however what we lack is the foresight to see the effect that would have on our day job. If we want for our views to be seriously considered by our representatives then we must make efforts to dispel this myth.

What I would suggest for The Innovation Movement and any other effort to educate our representatives as to the real effect of intellectual property rights would be to stress that

1) overbroad intellectual property rights leads to 'nuclear proliferation'

2) these issues are a concern to all businesses large and small

3) limiting intellectual property rights would not be the end of the world

 

Recently there was a tentatively critical post about patents at the Startup Professionals blog which highlights specific concerns about the patent process. This is no longer simply an issue of kids who want free music. This is everybody's problem and we need to sit down and fix this before China and India do it for us.

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Ben Fuller
Mon Dec 6 7:50am
Although I agree that educating politicians is vital it is sometimes difficult to compete with the financial incentives (and lobbying) provided by established industries when it comes to lawmaking. It is especially difficult as the 'correct' amount of IP is very subjective, there is naturally a tradeoff, which adds confusion to the debate (and makes any switch away from the norm much harder).

Hey kid, get back in line with the murderers and rapists!
RE: Copyright laws. - 04/23/04
Reading about the DOJ's sweep of school district's computer labs for pirated software, games and music got me thinking about something very disturbing today.

I believe I heard that the US incarcerates more people than any other country. If that wasn't already bad enough enough itself, here's the disturbing part: If I spend years developing a product, and someone steals or copies my idea, with or without a patent, they have committed no criminal act. At my own expense, I may be able to sue and win a civil damage with a patent, but they will never serve time in prison. Or, I could spend years developing software and someone could copy the concepts in months. Again, no criminal act. But, if I place a copyright notice, and the entire software is copied without my permission, the people who copy it, no matter how innocent, are now considered criminals and they could face time in prison. The difference between whether that person is a criminal or not comes down to whether there is this little notice or not.

With computers, copying material which is copyrighted, without permission, is such an easy and innocent act that children do it in epidemic proportions. The copyright law doesn't just expose these children and their parents to punitive fines, it makes them actual criminals! And yet, a man's lifes work can be stolen or copied with sometimes no repercussions whatsoever because it didn't fall under the category of work protected by the US copyright act, backed up by investigation and criminal prosecution, paid for by the taxpayer. It was maybe an engine part, a circuit, an algorithm, a new chemical, or other invention. Yet because it wasn't a song, book or software, he's left to protect himself.

The flip side is that the only thing that makes a criminal out of an otherwise normal child or shrewd business person is that copyright notice. We're not talking rape, arson, assault or burglary. We're talking about a few wrong "clicks".

If people want to make money at singing songs, writing books or producing movies, let them. And if they choose to use a medium or technology that lends itself easily to unauthorized proliferation, TOUGH! If they dont' like it, let them find another career or another way! It's their business, let them solve the problems and protect themselves or bare the loss. But don't let them put my kid in jail and use my money doing it just to protect their financial opportunities!

Drive-in movie theaters use to have the same problem. Kids would sneak in or watch the movies from trees. They didn't make criminals out of them for it! Instead they put up walls or hired security, at their own expense.

I've noticed that LAWS are rarely ever the right solution to a problem anymore. Yet time and time again and even more lately, that is the only solution we choose to use. We lose.

 

Reprinted with author permission from:

http://www.techass.com/politics/tdhpol.php#04/23/04

I am a bullfighter. I wish more people were like me because the BullPoopie is winning! http://usaproblemsolver.blogspot.com

Here's my opinion why open innovation is key to "inclusive" Digital Storytelling, and holding it back with copyright that's designed for a bygone era is bad for everyone.

Business Model: from Closed Mass Media to Open Social Media

Evidently, the demand for alternative sources of news, entertainment and media options are nearly as varied as people's personal taste in art and informational content. Clearly, the spectrum of possibilities is much more vast and divergent than anyone could have predicted.


As an example, many of today's pay-TV subscribers -- with access to 150+ channels of programming -- have formed the opinion that there's "nothing appealing to watch." People are resistant to the inherent limitations of the traditional mass-media model of content creation, production and distribution.

As a result, some people abstain from "popular" media -- because they've tired of this predictable offering. In contrast, some people will seek and crave alternatives to the reality-show fad of the moment, or the other professionally market-tested, focus group-validated, and highly homogenized TV product that's produced by the legacy media companies. The inverse is the realm of independent (Indie) or open media, and the Internet is instrumental to this business model.

Packaging & Distribution: from Forced Bundling to Freedom of Choice

Industry analysts say that mass-media marketers may be out of sync with shifting customer expectations about product selection and packaging. Traditional producers and distributors of entertainment content have had a fixation on forced product bundling. Record companies want to sell CD collections -- yet some people want to buy single songs for their MP3 player. Cable, satellite and now Telco TV providers want to sell television subscription tiers -- yet some people just want to buy individual channels and thereby create their own lineup.

The simplicity of content bundling has fans, but it isn't a panacea, nor is it an appealing offer for everyone. In fact, there's a discerning segment within the marketplace that has a strong desire for greater choice and flexible customization. It's an opportunity for on-demand product selection modalities, such as video on demand. Using the language of an economist, this is the matching of open flexible supply with eclectic customer demand.

However, from a mainstream customer's perspective, this is the domain of Personalized Media and the Digital Lifescape -- content combined and packaged my unique way, delivered to or retrieved from my desired place with my selected device, and then ultimately experienced at a time of my own choosing.

Digital Production: from Passive Consumer to Active Prosumer

For decades, big media companies either acquired or affiliated smaller print, radio and television distributors in an attempt to aggregate their mass-media audience. The model was based upon the assumption that advertisers would pay a premium to reach passive consumers of content.

Today's forward-looking multimedia market environment is very different from the past. It's a scenario of increasingly unrestricted abundance that's replacing the prior controlled scarcity of content. This shift is being fueled by the development of low-cost digital media authoring tools, and the rise of the Prosumer content creator, arranger and marketer.

Source: my GeoBrava Media project

David H. Deans is the Senior Partner of Deans & Associates, and the founder of GeoActive Group USA.

As I have said many times; the only way is to pass campaign finance reform, so that our legislators no longer have to sell out to the wealthy to get the funds to be elected.

Gene Cavanaugh (Marion Eugene Cavanaugh on the USPTO web site) specializes in small entity patenting (what the founding fathers intended in the US Constitution).

Copyright is really only affecting one fraction of the entertainment and software industry.  All other attempts to claim a loss from copyright are a lost cause.  For example, movie piracy is "rampant" and yet Transformers 2 did hundreds of millions at the box office.  If piracy were really damaging movies, this size number would be impossible, right?  The reason that copyright is not damaging movie sales at the theater is that theaters already provide an experience that is impossible to duplicate for free.  You pretty much have to pay for a ticket to get that experience. The same goes for music performances and sports or game event destinations.

The true "problem" with copyright exists in the direct sales of digital media.  with video games, music discs, and movie DVD's, the experience being sold is the exact same as what can be freely downloaded.  I cannot overemphasize how this is the fault of the producers and not the fault of the consumers. 

You are selling someone a disc which on it has the same thing they can get from someone else's copy of the disc.  If you cannot figure out a way to provide an additional event experience for the price that is not duplicatable, then that is your loss.

Furthermore, the free copying distribution channel is a huge benefit to some producers.  For example, ID software would not exist were it not for rampant piracy of their early shareware games like Doom.  I don't know anyone that paid for the shareware version up front, but I know plenty of people that purchased shareware expansion packs, etc. specifically as a way of thanking the developers. 

You can give something away and charge for something else.  You can provide experiences that are unduplicatable.  But you cannot give something to people that is infinitely and freely duplicatable and be mad when they do that very thing.  That line of thinking is just like selling someone alcohol and being mad if they get drunk from it.

Selling someone a ticket to see a movie is not selling them a digital copy of the movie.  You cannot sell a single digital copy of something, that analogy makes no sense and that's why the whole model is a whopping big failure.  Go to any 7-11 type store in China and get yourself a copy of Alias Wavefront or whatever for 5 bucks, and then get a copy of the latest blockbuster movie that was pirated and ask yourself which seems like a ripoff.  The movie will seem like a ripoff because it's not the same experience.

I am currently designing game programming course curriculum at CSCC, and I am a Sr. Systems Engineer for a major telecommunications company. I have a long family history in the Computer Science field.

Indeed, while many of us enjoy the benefits of being able to freely download music from the internet, we worry as well how the musician is to make a living if their music is immediately given away for free. While a furious debate rages over copyrights and patents, there is general agreement that some protection is needed to secure for inventors and creators, for the fruits of their labors.


The rhetoric that “information just wants to be free” suggests that no one should be allowed to profit from their ideas. Despite this, there does not seem to be a strong lobby arguing that while it is ok for the rest of us to benefit from the fruits of our labors, inventors and creators should have to subsist on the charity of others.


For all the emotion, it seems both sides agree that intellectual property laws need to strike a balance between providing sufficient incentive for creation and the freedom to make use of existing ideas. Put it differently, both sides agree that intellectual property rights are a “necessary evil” that fosters innovation, and disagreement is over where the line should be drawn. For the supporters of intellectual property, current monopoly profits are barely enough; for its enemies currently monopoly profits are too high.


The analysis leads to conclusions that are at variance with both sides. The reasoning proceeds along the following lines. Everyone wants a monopoly. No one wants to compete against their own customers, or against imitators. Currently patents and copyrights grant producers of certain ideas a monopoly. Certainly few people do something in exchange for nothing. Creators of new goods are not different from producers of old ones: they want to be compensated for their effort. However, it is a long and dangerous jump from the assertion that innovators deserve compensation for their efforts to the conclusion that patents and copyrights, that is monopoly, are the best or the only way of providing that reward.

 

A patent or copyright is the way of rewarding somebody for coming up with a worthy commercial idea, abound in the business, legal and economic press. As we shall see there are many other ways in which innovators are rewarded, even substantially, and most of them are better for society than the monopoly power patents and copyright currently bestow. Since innovators may be rewarded even without patents and copyright, we should ask: is it true that intellectual property achieves the intended purpose of creating incentives for innovation and creation that offset their considerable harm?

 

One should argue that license fees, regulations and patents are now so misused that they drive up the cost of creation and slow down the rate of diffusion of new ideas. Most patents are not acquired by innovators hoping to protect their innovations from competitors in order to get a short term edge over the rest of the market. Most patents are obtained by large corporations who have built portfolios of patents for defense purposes, to prevent other people from suing them over patent violations.

We should ask for a common rule to be framed to load burden of the proof on patent seekers by granting patents only to those capable of proving that:

  1. Their invention has social value

  2. A patent is not likely to block even more valuable innovations

  3. The innovation would not be cost-effective absent a patent

 

The conclusion is that creators’ property rights can be well protected in the absence of patents and copyrights, and that the latter does not increase either innovation or creation.


Sudip Chatterjee has been a member of the Insight Community since August of 2009.
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Derek Bredensteiner
Thu Sep 3 2:59pm
I don't think it can be so broadly stated that there is a general agreement that some protection is needed, nor that there are explicitly 2 sides to this debate.

[quote]For all the emotion, it seems both sides agree that intellectual property laws need to strike a balance between providing sufficient incentive for creation and the freedom to make use of existing ideas.[/quote]

I do agree and think you have an excellent grasp of the true problem with exiting laws, restrictions on freedoms to make use of existing ideas. But where my thoughts diverge is on the need for a regulatory or government intervention to set up incentives for innovation and creation.

In our existing system, there are already at least _some_ incentives to create outside of the copyright/patent system (as evidenced by the content creators and innovators making use of alternative business models today. I would argue that it's specifically because of the existing system that we are moving so slowly towards those business models, and that there is so little "large corporation" uptake. Without IP, there would be little choice left but to aggressively investigate those.

I think there is strong evidence at least some incentive without IP, and it clearly follows that those incentives would grow without the IP system in place propping up the alternatives. Now as to how strong those incentives are now, how much they would grow or what sort of large corporations may emerge that assist creators, or what the landscape of content will look after such a change; That's where I currently lack the resources and proof to support my position.
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zak potts
Fri Jun 18 3:01am
The copyright system has long been understood to play a critical role when it comes to the development and distribution of creative work. Copyright serves a second fundamental purpose, however: it encourages the development and distribution of related technologies like hardware that might be used to duplicate creative work and software that can manipulate it. When it comes to issues of online infringement, then, copyright policy serves two goals, not one: protect the incentives copyright has long served to provide authors, and at the same time facilitate the continued emergence of innovative Internet services and equipment. In this Chapter, I use the Google Book Search litigation as a lens through which to study copyright law’s efforts to serve these two sometimes-competing masters. The Google case is an ideal lens for this purpose because both the technology implications and the authorship implications are apparent. With respect to the technology, Google tells us that the only way for it to build its Book Search engine is to have copyright law excuse the infringement that is today by design part of the project. With respect to authorship, copyright owners are resisting that result for fear that the infringement here could significantly erode both author control and author profitability over the long run. I myself am optimistic that copyright law can and will balance these valid concerns. http://essayacademia.com ,a responsible essay writing service, is keen to address issues like this effectively.

"The value is not in the idea, rather the filter. The curator of ideas. The creator of new ideas. The sharer of relevant ideas." - Owen Kelly

That is a quote from a post I wrote some time ago. I spent countless hours attempting to understand the issue with copyright. On one hand, we have major industries supposedly built upon copyright. From the Recording industry to the Book Publishing industry; from the Photography Industry to the Movie industry. On the other. it is being abused so horrendously it is destroying peoples lives. We, as a public, are lead to believe artists make their money from, and because of copyright. In truth it is far, far more complex.

Copyright is increasingly becoming irrelevant to everyone, even musicians don't care. The inaction of major publishing companies to innovate is actively causing them to become irrelevant quicker than expected. It is their desire for total control, that will eventually cost them any control (and thus profits) at all.

A Change of Hands

All these industries are in the business of Publishing. Their golden era was at the height of physical distribution. We relied upon them to help spread information to the masses. They contributed to enriching the culture. Copyright helped, sure. But it was less a driving factor in the success of these industries, than talent creators.

These industries were the only way for content creators, be they musicians, writers, photographers, or filmmakers, to reach a wider audience. They were the gatekeepers. Without them no one could hear you, see you, know you. As content creators our highest goal is to be heard, seen, recognised. After that comes the desire to make a living from your chosen craft.

When tracing the history of publishing in the last century (1900s-now) we can indentify two distinct but overlapping methods of distribution. Physical publication, which lives in the realm of atoms and requires physical work to manufacture and distribute. And then, Digital publishing. Digital is a fickle medium, it requires similar methods of creation as physical (as such the associated property rights are often misappro). But digital publishing lives in the realm of bits. It requires no physical work to distribute a digital work.

The internet democratised publishing. With the mass proliferation of blogs, social networks, YouTube, Myspace, Facebook, Flickr and SoundCloud it is now possible for anyone to publish anything. Basic publishing costs absolutely nothing. For a small (very small compared to physical distribution costs) fee you can have your own hosted website. It is no longer necessary to practice for 6 hours a day, 7 days a week to become good enough to get a Major record deal in order for you work to be published. The internet has enabled anyone to publish anything, as such it has brought about a renaissance in the creative industries.

Let's jump back a bit to the quote that launched this article off. "The value is not in the idea, rather the filter." What does that mean? Well, in the context of this quote an idea is anything that can be grabbed by the mind, but not the body. It is a song, a riff, a movie, a concept, an artwork you get the idea.

Too often idea rights are confused with physical property rights. The two are not the same, in fact they are polar opposites. Whereas someone can control and 'own' physical property, once an idea is repeated by one person to another, they both 'own' the idea. Neither can ultimately prevent that idea from escaping.

To quote Thomas Jefferson“it is the action of the thinking power called an idea, which an inpidual may exclusively possess as long as he keeps it to himself; but the moment it is pulged, it forces itself into the possession of everyone, and the receiver cannot dispossess himself of it." Think of an idea as a flame. You can bring your torch and light it from my flame. Now we both have fire, you didn't take anything from me but we are both better off.

A filter is someone or a group of people who 'filter' many ideas and create a new one. Hence the latter part of the quote, the value is in "The curator of ideas. The creator of new ideas. The sharer of relevant ideas." Whilst a filter can be called many names, artist, creator, journalist, photographer, filmmaker, the notion is still the same. They put time and effort into consuming, collating, interpreting, reworking, mashing up ideas, culminating in the creation of a new idea, or new work.

Previously for a filter to succeed they had very little choice but to 'sign' with a major publisher. Some industries were kinder than others, though few would argue the recording industry (distinct from the broader music industry) is the harshest of them all. Their rampant abuse of copyright law, often without cause on little more than accusation or speculation.


More damage than good

Anytime a law is doing more damage than it prevents, is the time for that law to be laid to rest.

I wrote before about how the internet has brought a renaissance in publishing. A renaissance being a heightened output of creative works, which by all available metrics is the best description of what is happening. But, why did this happen? Well, we now know the fundamental difference between physical and digital distribution. And we have a good grasp of what an idea actually is, heres the mind boggler: Digital works behave like ideas. Let's recap for a second. Physical distribution provides a 'container' of sorts required to publish the expression of the idea (the expression being the recorded idea, be it audio, video or written).

But for digital works, the expression is the container. Confused yet? Well we have the [Idea] which can be recorded [Expression]. It can then be published either physically requiring the expression to be put in a [container] such as a CD, tape, vinyl, film, VHS, print or book. It can also be published digitally, where it the expression (recorded idea) is also the container.

The internet, being digital, allows quick, effective mass publication of ideas. This significantly decreases the need for physical distribution, but for reasons I will not delve too far into here it does not negate that need. Good content creators always have a following. A group/community/tribe of people of varying levels of dedication that all want to support, be associated with and ultimately communicate with the content creator. Many books have been written on this topic alone.

Copyright came about as an incentive to create new works. More recently its original mandate has be bastardized into a protection to ensure that only one entity may control the expression of the idea.

Success comes from Innovation

New containers, mediums of distribution came about through innovation. From the VHS and Betamax, to the vinyl record, radio to television were all fought against by the incumbents fearing a change in the status quo. They became so dependent on maintaining on business model, they failed to see the benefits of another.

The jump from cinemas to VHS terrified the movie industry, and yet it is perhaps on of the most successful innovations of its time. The internet is far different to anything brought about before for the simple fact it is the container. Sure you can have music in various formats but at the end of the day like VHS is plastic and tape, digital works are all just 1s and 0s.

Lawrence Lessig said in May the Source Be With You back in 2001, "Our trend in copyright law has been to enclose as much as we can; the consequence of this enclosure is a stifling of creativity and innovation." He couldn't have been more right. As a method to 'safegaurd' and protect their now irrelevant and defunct business models the major publishing industries pushed for extensions and futher restrictions to copyright. None more so than the Recording and Film industries.

Whilst one can rarely stop innovation, it can be slowed down.

Thanks to the significant legal efforts by the RIAA new music startups are currently suicide. Copyright, the legal process and naive labels have exploited copyright and the associated laws to actively prevent innovation. This prevents innovation, destroys lives, annoys billions of consumers, all in an attempt to maintain the status quo.

The status quo has changed. A simple fact of life is that the status quo will always change over time, those who can innovate and adapt will succeed. Those unwillingly complacent scared incumbents will fight, given they have tools to fight with. Copyright law, the DMCA, intense lobbyists and a horrible propaganda machine are powerful tools the RIAA and IFPI use to abuse the law.

No one should be given the power to stop a competitor purely because they may be better than you. That would be like crying afoul because you own a pizza shop and a bigger, better, more efficient pizza shop opens up down the street.

People innovate all the time. It's business. It's culture. It's life.

J.D Lasica's book, Darknet: Hollywood's War Against the Digital Generation, has many great examples of how copyright has hindered creative works. (Honestly, I'm not mentioning it to plug the book, and have nothing to gain by mentioning it.) I haven't found a better trove of examples you are seeking here, in this forum.

I'm an interested observer, not credentialed, not anyone important.

In the early days of American history, much of the progress that caused America to far surpass the rest of the world was the innovative new approaches we took. One of the new approaches was protection of IP. Rather than have the true authors obscured by people with more influence, or a fear of having their work stolen (the early works of Maxwell, the secrecy of Tycho Brahe, which would have invalidated Kepler's work, had Brahe not died when he did), America provided protection so that work could be safely publicized.

However, since then, the importance of campaign funding (and therefore of the people who supply those funds) has perverted the system, turning it upside down.

Until we eliminate the overpowering influence the wealthy have on legislation, we will have an IP system that is broken, and this is more true of copyright than any other area!

Gene Cavanaugh (Marion Eugene Cavanaugh on the USPTO web site) specializes in small entity patenting (what the founding fathers intended in the US Constitution).

Copyright is essential to some industries: None of the thousands of artists who are sampled and sell the rights to be sampled by others would make a cent if there was no copyright. If there was no copyright, nobody would stop the guy next door from opening another drycleaner, and offering the same inventive promotions as me ("free undies night", "two pants for the price of a suit"), and even steal the design of my signs.

If that was true, there would be no incentive for either of us to innovate. We could just try to put up a bigger sign to attract customers, and keep prices lower than our competitors. In the end, the weakest would be pushed out of the market, and we would end up with monopolies, which are more expensive for customers than innovative competitors.

At the same time, creating tools which can be used to infringe on copyright does not necessarily turn out bad - look at the copier, the VCR, and the PC. But that is not the problem, however. The problem is that there is a gap between how people perceive the laws, and the way they are practiced.

There have been countless cases of sampling of artists who did not get paid, much to the detriment of the artist (and not to the artistical value of the music, usually). That is actually wasteful: It takes up resources in the legal system which could be used better, if people knew what the law actually contains. If it did, they could also make intelligent efforts to change it, instead of protesting against the concept outright (present company, of course, exempted).

The real solution is, in other words, education. If the record industry, and the publishing industry, invested their time and money in educating people about what is right and wrong about copyright, perhaps we could have an informed, instead of a sometimes hysterical discussion. That would be a good thing, and force a number of innovations to market. Perhaps that would be worthwhile for the initiative to discuss?

 

I like to look to this quote to help with understanding the initial purpose.

"To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries"

The phrase indicates it was not giving them time, because they had the rights to it, or because they have the right to success as a result of their ideas, but to only promote progress.  Science and Arts, but in the nature of progress.

I like to imagine if there were no limits, and that once you created something, it was yours forever.  Saying this is the case, the Inventor, or more appropriately, the party who patented/copyrighted the work first, or something else which can say that a future work was derivative of, was in fact entitled to the person who initially filled our the form.

This being the case, you would have industries of single companies all the times.  Monopoly after monopoly.  Jim invents the Pencil Sharpener, and after that, Jim has the exclusive right, and perhaps his descendants after he leaves us, to make Pencil Sharpeners for so long as there is a need for them.  This does not promote competition within the same field, but only in that someone will try to find a simpler solution, that they can copyright themselves.  Also it can lead to monopolistic tendencies, from Price Gouging, to forcing competitors out of the market.

I'm sure some companies wish they were the sole manufacturer of their product, as it may be better for them, but it is worse for the market, and worse for people overall.

In the Arts, you would never hear a cover of a song if it was similar to the above idea, for someone who would choose to lock down their work.  People learn to make their own music, by learning to play music first.  Imagine if they could only play songs they purchased, or have a right to play, because they needed to purchase it.  It discourages people to learn and respect the art of others, to the sole creation of their own.  I can foresee owning a Genre, if the above were true.  A genre gets started by many people doing similar things, but image for every song they create, because it is in some way similar to a prior idea, that they need to be paying out to that owner?

Of course it would not be restricted in everything, people would license their works, genres, and machines out, and that cost would be pushed the the end user in turn.

Admittedly I do not know a lot about Medical Science, but I'll use a Wheel Chair as an example.  Now at first you would think, it's just a chair with wheels.  Say Wheels & Chairs have been around forever.  But handles have not, and are copyrighted.  You have to pay that to the Content Creator.  Also the foot rest and the brakes are also fairly new, and those need to be payed for as well.  Those costs are payed out, and the Wheel Chair price goes up.

That seems contradictory to the initial intent to Promote the Progress, and in turn hurts it further. 

A far worse thought than the above, which is not too far fetched from our current though, is the Patent Troll.  In that above world, say companies would just exist on buying patents for people, hoarding them for a day when they would serve them better or when they can be combined.  "It's not a lot of money coming in now, but in time, small mirrors will be built on every car, and there will be a premium paid to us, so that they can still build them.  We can tout safety and awareness, and why the need to be on every car, and people will then have to pay us."

In this fictional society, and our own, in the long run, there would be few companies, who own patents on everything, and would fight against the other companies who came up with an idea, or try to say it was derivative of their own works.  They have no incentive to do more than they need, and in all likeliness they would have far more lawyers than engineers.

Imagine in that world, if Copyright was eternal, their work their own, if people were working against human interest and progress, and banning people from things that would improve their lives.  Already we see it now in medical science with the patenting of drugs, devices, and no doubt in time procedures, that companies feel entitled to, and is not for the progress of man.

Where Copyright could help is in flexibility.  Certainly you want people to keep innovating, as the purpose is to give them that amount of limited time is for them to succeed with it, and in turn, to move on to something else.  It was not because they had a right to their work or to succeed, but because they wanted people to keep innovating.  We praise people who continue, the names of Edison, Tesla, & Bell are remembered because they did so much, not because they had one idea, and spent their lives milking the money out of it.

Progress being the goal we strive for, and to push further, incentive should help, and copyright could be used for the better.  We want the inventors of the world to keep inventing, the song writers to keep writing, and we want to progress as a society.  No one debates people should be able to capitalize on their own works, or even if they improve on another persons work, but it should not last forever.  It should not last longer than it takes to put something into production.  Some things will take time to bring to market and will require preparation, and the ability to do so.  Things invented today are not seen for years in homes.  But once production occurs, and it is on the market, is it not fair for another to compete, much less improve on someones work. 

Take a computer mouse.  Single button, Dual button, and in time the scroll wheel.  Though we applaud the invention and it's ease of use, if in time someone improves on the initial design with their own work, do they owe it to the originator so much, to restrict the progress in the nature of personal gain?  Sometimes competition hurts the market, and this is understood, and if there were better ways to cooperate, perhaps it would not be such an issue.  However even cooperation in this day and age, can invite legal troubles.  Companies force you to sign the rights away to all things you create when you start for them, not just for their own greed, but also to limit liability and competition should someone go elsewhere.

It would be cheaper for business to not have to prepare for lawsuits on frivolous copyrights, it would be cheaper for the end user to not have to pay so much to everyone who is owed when a product is purchased.  It would assist in competitors coming to market with alternatives.  The Gucci knockoff purse sold for 50$ rather than full price, does not devalue the Gucci brand, but increases it, in that another has to lie to sell their products.  And if the initial product is better, it should sell better, not because of brand, but because of quality.

I feel competition & cooperation is better for Industry and the Arts, and both are better for the progress of mankind.  Restrictive copyright hinders the options of both, regardless of intention, whether they forestall changes in their industry, or the protection of intellectual property.  Where are our the new generation of Libraries in this digital future, to grow and learn in?  We imagined computers, not in the classroom, but replacing the desk, the text book, because it would be more efficient, save paper.  What happened to the paperless office?  I don't think copyright killed the ideas, but it took far longer for a book reader to come out to market in a push from Amazon, than it did for most every other type of media.  The industry that will be last to fully arrive in this digital era, is reading one, and yet books are the smallest size.  One High Definition movie's worth of space on a PC could fit probably every text book written in the last 30 years in the same amount of space.

The way it is used now is causing stagnation instead of creativity and advancement.  Restrictive Copyright is now used as a weapon, to fight or scare into settling lawsuits, or to quit entirely.  And when I'm using the words fight and scare in a sentence, I'm thinking the last thing on your mind is the word progress

Just an observer.

I don't know what Mike's legal background is, but I do know (as an attorney) that he is almost unfailingly right about the abuses of copyright by the wealthy.

While I have virtually no faith at all of finding a democratic solution without campaign finance reform (after all, the wealthy paid for our legislators, and expect them to perform), I do think Techdirt could be a force for good.

If someone (Techdirt seems like the obvious choice) formed a legal defense fund for funding fights against these abuses (say, with the EFF), and hopefully also fighting for campaign finance reform, they might be able to help us back onto the road to democratic reform.

Gene Cavanaugh (Marion Eugene Cavanaugh on the USPTO web site) specializes in small entity patenting (what the founding fathers intended in the US Constitution).

Like most issues facing modern society, this one is complex and one could look at it from several different viewpoints, none of them necessarily wrong. The viewpoint I will choose is to examine the question of originality.

 

All creative expression rests upon a foundation of building blocks. In music those blocks are notes, then intervals (one note following another), then chords which are two or more notes played together, then progressions and melodies which are notes or chords played one after another. In language it is an alphabet, then word parts, then words, then sentences, etc. In painting it is color and geometric shapes, and so on.

 

All of these foundations that humans use for expression are quite limited. In the western world we only use 12 notes, and a very limited number of chords because most combinations of these 12 notes do not sound pleasing to our ears. Most popular songs do not use more than a handful of chords. The English alphabet has only 26 letters, and although there are a little over 100,000 words, they cannot just be put down on a page in random order. The rules that govern which word can follow another place one restriction, and the reality is that most English speakers use and understand less than 10% of those words in regular usage.

 

It is easy for anyone to see that there is limited room for originality in creative expression. There is no such thing as a totally original chord progression, or a totally original sentence structure, or a geometric shape that has never been seen before. Nevertheless creators - and more importantly, the corporations that buy the rights to their works - easily forget this and tend to overestimate the originality of their works.

 

Considering the sweat and toil that goes into creation, this overestimation is perhaps forgivable and certainly understandable, but it must not be allowed to govern our thinking when we write and apply the laws our society lives by.

 

Considering the fundamentally limited building blocks of expression, it is easy for anyone to see that we must be very careful about granting exclusive rights to forms of creative expression because it would be all too easy to slip over the line and copyright something that is so obvious and generic that copyrighting it would block all other artists from having access to basic and absolutely necessary tools for *their* creative process.

 

Compare the first seven notes of Mary Had a Little Lamb with the first seven notes of London Bridge is Falling Down. The reality of artistic creation is that there is no such thing as a wholly original work that bears no relation to and no connection with the artistic works before it, and contemporary to it.

 

Because of this copyright should be treated with the utmost caution, erring always on the side of freedom of expression, not on the side of granting of exclusivity. Ultimately any legislation or jurisprudence that ignores this reality will only be overturned in time, at great cost to both public and private concerns, and with great disruption to society.

Adam Zachary Wasserman has spent the last decade working as a high-level strategist in technology-based product management and business development. Adam sits on the advisory boards of Syncrata and Little Animation.
The issue we have here is that the situation is not about preventing more damage. I believe the true issue we are facing is that this is a scientific issue being handled from a political viewpoint. We can all think of other examples where that causes complications such as our space program, or when religion gets in the way of science, or many others, to look at just copyright (as it is the biggest cause but not the root cause). That is like looking at the leaves of a tree but not the bark or the roots (figuratively and literally). The problem is, we need to have another way to argue against copyright. Plenty of lobbyists are simply turning the phrases we use around, and when that occurs and we simply defend ourselves it becomes a political game and we lose in terms of clout. We need to find another avenue to argue for innovation without that phrase itself. Thus, it is, a mindset change, a perception change, even though it is the same thing. I suggest we no longer look at innovation, but focus more on market influence. If not market influence, then we should focus perhaps on GDP/GNP. Things that are more solid to the old folks that are the listeners. They don't understand the phrase innovation, but they do understand things they can substantiate like arguing about GNP. We must do this, as this is how other people reach out. They say "we've lost millions of dollars", and we are stuck because we are just going "the numbers are wrong", but what we need, is counter-numbers. I am not saying fight fire with fire. I'm saying that we need to use tactics that non-technical people or folks who read at a glance, will recognize.
A different viewpoint.

One of the best ways to see how a "lack" of copyright has allowed innovation to flourish is looking at the Free/Open-Source Software (FOSS) movement. Some of the most widely known and popular software available nowadays, such as Linux, Apache, and OpenOffice, simply wouldn't exist if the original authors had tried to lock their work down with copyright restrictions.

The main reason FOSS exists is because of the GNU General Public License (GPL). In short, this license allows anyone, from an individual to a corporation or government, to use the software for any purpose, to modify the software as desired, to share the software with others, and to share any changes made to the software. This is contrary to traditional, proprietary software and is almost the complete opposite of copyright.

Because the GPL is so different from copyright, it is often referred to as "copyleft". It's main purpose is to ensure that software is, and will always be, free. This means free as in cost and also in liberty. FOSS programs are available in raw source code, so anyone can build their own version for free or modify it as needed. However, the GPL doesn't prevent a developer from making money with the software. It can be marketed and sold just like other software, it can be given away for free and the tech support can be sold, or any number of other options can be used to earn revenue. However, the vast majority of FOSS projects are released entirely for free, using donations to support the work.

GNU/Linux is one of the most popular operating systems for servers right now, and some desktops; GNU is the actual operating system (OS) while Linux is the kernel that drives the OS. Without the GPL, neither would be as popular as they are. As a brief history lesson, GNU was started as a way to create a Unix-like OS so academics and other users wouldn't have to pay the high licensing fees to Unix providers. However, to run the OS, a kernel is needed; the GNU kernel was called "Hurd" but development was slow. Linux, created as a student project, became the kernel for GNU because of the delay of Hurd. Only through the contributions of many developers could the "seamless" integration of the two be made.

Now, several thousand FOSS projects are being worked on, some for free, some for donations, and some for money. Copyleft ensures that everyone has an equal footing when it comes to development; no one is able to prevent others from accessing the software. The GPL has been upheld in court when companies have taken FOSS programs and not followed the requirements to give back to the community any changes made to the source code. The companies weren't prevented from making money; they only had to ensure that the changes they made were put back into the code so others could benefit also.

If these projects followed the traditional copyright restrictions, there would be no free sharing of ideas or source code. Anyone could lock up the code base and prevent others from using it without paying for the privilege. Even if allowed to modify the code, the modifications could be kept private (some open-source licenses allow this but the GPL does not). Perhaps the source code could be viewed but not modified, copied, or otherwise used. Normal copyright would prohibit the inherent community approach to software development.

Many programmers learn how to program by looking at the source code for FOSS projects. New ideas are spread between developers in these projects. In some cases, entire companies are founded upon, or at least run on, FOSS.

For comparison, Microsoft software is, with a few small exceptions, closed source and heavily restricted with copyright. The user is prevented from looking at the source code, modifying the code, or pretty much doing anything that isn't allowed by MS's license agreement. Any modifications or updates have to come from MS. FOSS, on the other hand, allows anyone, from the original developer to an end user, to make and distribute changes.

With copyright restrictions, only an individual entity (whether a single person or a corporation) benefits. Without copyright restrictions, everyone benefits.

AS Electromech. Tech., BS Computer Eng., MS IT Management, working towards Ph.D. in Info. Systems

Laws designed to prevent piracy of ownership, whether they be ideas, copyright, or patents are the cornerstone of our democracy and capitalism itself. Without them, theft of ownership rights and the ensuing loss of income for a persons’ investment of time, effort, funds and talents is lost to others. If they are consumers, they are consuming stolen goods. If they are big businesses, they are stealing from small businesses. If they are a country, they are stealing from another country.

 

The argument that progress and innovation require that taking what belongs to another without remuneration is necessary to “save” the world is ludicrous. The progress and innovation is the ability of one learned or talented person creating something they deserve to be paid for. They are the progress and the innovation. Their work is what they have to barter with to make a living, in these modern times in exchange for money to buy their food, pay rent or house payments, etc…

 

The end result of the argument that stealing is necessary for innovation is doublespeak for a totalitarian slavery state with commune principles. It will not stop with music, art and writing, already near starving professions for most. It will end up with invasion into your brain to steal your thoughts and your time with brain interfaced “cloud” environments. All that is missing is an embedded device.

 

Right now a good example of this is Secretary Chu, who stated that China needs US technology in new energy for their “progress” and innovation. First Solar is now building their factory in China. All of the recipients of new energy funds from DOE are required to give up their rights in exchange for funds for “innovation”. Those rights will then be transferred to China for their “progress”. In real terms, China is stealing from small businesses and would be wage earners for jobs in the US, using Secretary Chu. This, from a country which now owns most of our long term debt and is the largest money lender to the US. It is the exact opposite of an economic stimulus for the US economy.

 

In the former Soviet Union, nearly all scientists were imprisoned to work. We are closely approaching that model in the US as well, except it is not for the US… it’s for China.

 

The Communist agenda to steal “work” for the profit of others, even if it is entertainment is a crime first and against US Constitutional rights second. The Constitution was established to uphold the rights of the individual and laws were put into place to uphold those rights. The problem is they are not enforced.

 

Automation on the one hand threatens to eliminate labor jobs with robotics, famous in the GM commercial where the human like robot is homeless and feeling sad looking at the cars he created. As these jobs are lost to robotic automation, people are moving into jobs of the mind and talent. Without a way for them to make a living at what they elect to do, there is no food for them, no tools for them and no “progress and innovation” from them. They become a ward of the State or they die. Without tax income, the State dies. Without an economy there is no income. Without individual rights to own their own work and make a living from it, there is no economy. With no economy, there is no Nation.

 

What is really at stake here is our Sovereignty. We will not remain a Sovereign power without upholding individual human rights, especially the rights to their own thoughts, ideas, work and accomplishments, for which consumers should pay for consuming. The best way to accomplish this is with a system of AutoLaw to enforce individual property rights. In this way, a new economy can flourish with a clear economic system of payment to persons for their work. It will avoid a nation of slaves and wards of the state…Communism and/or Totalitarianism.

 

The airwaves belong to the public and the tools for using this were provided by our own entrepreneurs like Bill Gates, who made a fortune off of his “ideas and innovation”. Thanks to him, you have personal computers and the Internet was expanded. He had almost nothing when he started, except his own thoughts and abilities. How fortunate for poor children that he chooses to spend a portion of his income on them as a philanthropist who is one of the richest men in the World.

 

There is a big difference between giving to the poor and being stolen from for the poor. If his rights had not been upheld, there would never have been an industry like we have today. The hackers who sabotage the networks are just causing everyone to lose their time, money and computer contents. Stealing for any reason is a crime. Stealing via communications technology is a Cybercrime. The way to deal with it is to turn people into the FBI for law enforcement to prevent a lack of “progress and innovation” by the human mind.

 

 

 

Robin L. Ore is an HDTV Pioneer and Communications Industry Expert. She has a degree in the Health industry and is an Inventor, Scientific Researcher and Entrepreneur.

I'm responding to this case, because I (not surprisingly) find the topic to be fascinating.  But, since I obviously work for Floor64/Techdirt, I'm not eligible for the award on this case.


One of the major issues in helping the public, the press and politicians understand issues related to copyright and how it can interfere with innovation is that the entire concept of copyright has been blown up into something of a mythical beast, clearly separated from its true and intended purpose.  I'd argue that there are three key points that need to be understood in order to make sure that copyright is not interfering with innovation.

  1. Understanding the purpose of copyright.  This seems simple, but in practice very few people seem to understand the true purpose of copyright.  Many falsely believe it's to "protect" the works of a content creator, but the true reasons are laid out right in the Constitution:
    To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries;
    Thus, the key point, which everyone (the public, the press, politicians) should be reminded of frequently, is that the purpose of copyright is to "promote the progress." If copyright is not doing that, then it should be examined.


  2. Highlight the many examples of content-related businesses that thrive without the use of copyright.  Historically, even in the content creation business, copyright was only used sparingly as a business model.  For most of the history of the United States, copyright required "registration" or "formalities" to get and keep.  And yet, a very small percentage of content creators actually took advantage of this.  In other words: most people recognized that there were already plenty of incentives to create, without copyright.

    Today, of course, there are many, many, many more examples of that happening. A rather large part of the internet demonstrates that there are plenty of incentives to create that have nothing to do with copyright (though, the copyright industry will gladly lump them in and credit their creation to "copyright"). Business models may shift around, but content creators have shown time and time again that there are ways to earn money from the creation of content that don't require directly selling that content.

    Some great examples of this are people like the musician Trent Reznor, the filmmaker Kevin Smith and the author J.C. Hutchins. There are many more examples as well -- but all three demonstrate examples of focusing on ways to both build up a strong community base of "fans," provide them with plenty of content for free, but also including a clear "reason to buy" beyond just the content.

    In all three cases, those content creators have worked hard to cultivate committed fans -- and then they've made sure that the products are worth buying beyond just the content itself. They've created ways where it's not the copyright that matters, but the connection with the fans and the additional value (beyond just the content) in the product that's for sale.


  3. Highlight examples of how copyright is used to stifle innovation.  This is less important (and perhaps less effective) than #2, above, but still important.  As you look through the history of copyright -- especially over the last century, you see example after example after example of how legacy industries are using copyright not to "promote the progress" but to actually stop innovation and competition.  A large part of the 1909 copyright act was put in place to try to stop the menace that was "the player piano" from destroying anyone's desire to listen to live music.  The radio and the phonograph were supposedly similar threats.  TV was supposed to kill the movie business.  The VCR was, famously, "the Boston strangler" to the movie industry.  The iPod was nearly sued out of existence.

    Luckily, in those cases, the industries working to stop such innovation failed. But in the last decade, the situation has flipped. The industry has successfully stopped a variety of new and unique innovations, such as various music services online. There have been lawsuits trying to stop satellite radio devices from recording programming. Recently, there have been a series of attempts to stop innovation in the DVD recording and rental markets -- all under the name of copyright.

    The DMCA has given the industry an effective "veto" on any new technology that it doesn't like via its anti-circumvention clause. All the industry needs to do is "encrypt" the content in some way, and anyone who tries to unencrypt it for innovative uses is violating copyright law. This way the industry has to approve any such innovation -- and they block all unless they are given a king's ransom. That's not innovation. That's hindering innovation.

Through the repeated use of these three mechanisms, hopefully we can teach people how to scale back the abuse of copyright law and to let innovation flow freely.  The first issue is key, because a true understanding of that would lead to more of a "means-tested" copyright system, where the use of copyright should be tested against the purpose in the Constitution.  That is, any such use of copyright should be looked at to see if it is, in fact, promoting the progress, or being used to hinder it.  Today, almost no one does this.  Copyright is expanded regularly without a single attempt to examine the impact on innovation or progress.

The second point above is then key in making it clear to people that copyright, alone, is not the sole incentive for creation (and, often not even an important incentive).  There's a myth that is commonly repeated that a lack of copyright means that content creators "don't make the money they deserve."  That's simply not true.  The large and growing list of success stories in business models that don't require a reliance on copyright should put an end to that myth, but it's a story that's so rarely repeated that it goes under the radar (or worse: is considered an "exception").  The more that can be done to promote and remind people that copyright isn't the only business mdoel (nor is it the best) for content creation, the more they realize that the claims of the copyright industry are quite exaggerated.

As for the third point, it certainly gets plenty of attention in the tech world, but it needs to go beyond that.  It hasn't really reached a tipping point in the press or among politicians, who simply don't recognize how often and how widely copyright is used to hold back and stymie innovation.  However, I'd argue that it's important to offer these points up in close conjunction with the examples of better business models, or the "downsides" will often be brushed aside as "necessary evils."  That is, there is an argument that justifies the downsides of strong-handed copyright by saying the content requires heavy protections in order to provide incentives to the creators. But if you can show that such incentives can be found elsewhere, it neutralizes that argument.

By emphasizing all three of these points together, repeatedly, hopefully the public, the press and politicians will begin to recognize the importance of making sure that copyright does not interfere with innovation.

Mike Masnick is the CEO and founder of Floor64, and writes and edits the award winning Techdirt blog.

Viewed from the other side of the Atlantic, the US looks like a land where freedom of thought and speech has delivered an enviable wealth of ideas.  American history embraces a catalogue of innovators and pioneers, from Benjamin Franklin and Eli Whitney through Thomas Edison and even Bill Gates.  New ideas open up new opportunities.  But fear now competes with freedom to be the driving force behind the American economy.  The freedom to discover the next good idea is cowed by the fear of losing what is already owned.  But that is the nature of innovation - searching for the next valuable idea means risking the idea that went before.

It was not always so.  Once upon a time the US was a young nation, greedy to learn and to grow.  Benjamin Franklin was an innovator, but he also engaged in piracy.  Franklin, like others, republished the works of 18th century British authors without giving them any reward in exchange for copying their words.  As early as 1808, the poet William Wordsworth complained about exploitation and argued for copyright to be extended.  The most popular novelist of the Victorian era, Charles Dickens, lobbied Congress during his North American speaking tours, protesting that the copyright of British authors should be recognized in the US.  His pleas fell on deaf ears.  America needed the wealth of new ideas and lacked libraries.  For Americans to benefit from education and entertainment, so the argument went, necessitated cutting costs, and that meant not rewarding the British authors who should be satisfied with the rewards received elsewhere.  And was not the success of Dickens' tours a real demonstration that piracy helped authors, rather than hindering them?  The argument went on to assert that Dickens benefited most from the enhancement of his reputation gained by the wide circulation of his work.  Whether Dickens thought so or not, the Americans had decided this was worth more than profiting from the sale of fewer books bearing his name.  Does that sound familiar?  It should, because we hear the same debate today.  The difference is that the tables have turned and now the US is concerned that its valuable copyrights are exploited by those greedy, growing, countries.

Whilst the struggle for copyright is sometimes seen as a battle between nations, it is also a battle of will within national borders.  The emergence of a political movement in European countries, the Pirate Party movement, tells us something about the strength of feeling across an increasingly polarized debate.  Businesses pursue stringent fines for P2P filesharers.  Governments enforce stricter laws to protect copyright.  Citizens respond by forming new political parties and canvassing for votes.  There is a Pirate Party in the US too, though the nature of American democracy makes it very unlikely they will break through and raise the profile of copyright reform.  The frontline of the US copyright debate is the courtroom, not the ballot box.  In contrast, the very existence of electoral alternatives has enabled European parties to secure valuable attention in mainstream media.  In only the first month since being launched, the Pirate Party UK has secured room for the debate about copyright reform in every quality British newspaper, on television and radio, and of course all over the internet.  All of this is encouraging for a party that wants people to freely exchange their thoughts, and is a signal that even in rich countries, many see the appeal of less stringent copyright.

The counterargument to copyright reform is that there will be losers.  The losers are supposed to be those who create, or the losers will be all of us.  The conclusion is that either the creators receive lesser rewards for their work, and so they will be poorer, or the creators will simply create less and will do other jobs instead, leaving us all poorer.  But Dickens did not stop writing because of American exploitation of his words.  If anything, he was inspired by it - inspired to respond via Martin Chuzzlewit.  The same internet that enables instantaneous and mass duplication of copyright works has transformed many other markets.  The internet enables middlemen to be stripped out of supply and distribution, and the benefits are passed on to the consumer through lower costs.  Take this to its logical limit and you do end up with an extreme - the same extreme as Benjamin Franklin not sharing the profits from the works he pirated.  But far from ending creation, piracy simply changes the market dynamics.  One source of revenue is closed, not all sources.  Dickens made money by speaking.  Musicians can make money from live performances or merchandise.  The copyrighted content stops being a marketable product and instead becomes the fulcrum for a kind of marketing.  This marketing is all the more powerful because it is spread from individual to individual, and cannot be manipulated by business interests.  In other words, people promote the content they like, not the content they are told to like, and all studies show that we trust the recommendations of friends and ordinary folks far more than we trust celebrity endorsements and slick corporate promotion.  The evidence is that this peer-to-peer advertising is effective in creating new revenues.  This is a threat to the jobs of some middlemen, who are paid to influence the market, but is a boon to consumers and puts market power and intelligence back into the hands of the people who should be dictating what is popular and what is not.  The significance of the advertising effect of free content is demonstrated by the observed correlation that the most prolific downloaders of pirated content also spend the most to legitimately buy content.

With a marketplace in rapid transition, it can be hard to identify all the factors that cause it to happen.  The digital marketplace for copyrighted content does more than increase the potential to freely copy works that were originally created with profit in mind.  It also reduces barriers to entry.  It reduces them so far, that, at the extreme, the marketplace collapses.  People just give and take freely.  This has been observed already with open source software.  We see it with the rise in so-called 'user-generated content' on sites like YouTube.  'User-generated' is a euphemism for 'not to be taken seriously because it does not have a big budget'.  Thanks to the democratizing effect of other technological improvements, married to the free distribution mechanism of the internet, then all it takes to create a popular song is to possess a guitar and a microphone, without the need for a marketing budget.  Beneath the veil of piracy, the real factor that drives down prices is the proliferation of competition, from small business, from micro business, from hobbyists and people who create for the pleasure of friends.

Resetting the marketplace so that many can produce for many will diminish some business models.  It also creates new ones.  If you cannot profit by controlling a much-sought copy of one work, perhaps you can profit by using the work to attract people to other goods and services, or by embedding the work within another product.  The music industry has recognized this, and now seeks to make more from new activities like selling t-shirts with lyrics written on them.  This is innovation in the true sense - instead of just creating variations on an established theme, the goal is to develop genuinely new kinds of products.

Supply and demand suggests that the money saved on certain kinds of products just gets spent on others.  This is the basis of the real value proposition for any economy.  Either it remains stagnant, and tries to protect existing business models, or it is open to change and incubates new business models.  Copyright was created for an old business model, and not a very good one at that.  Technology has moved on from the time when printing presses were expensive and distribution of content was physical.  Many of us may love Mickey Mouse, but perpetually extending Disney's copyright stifles creation instead of encouraging it.  Governments that try to preserve existing business models by defending copyright are missing the point of how creative people with few barriers of entry to a huge potential market will short-circuit big businesses over time.  Some will give work away just to get the foothold of recognition.  Unhappy that your publisher does not promote your work?  Then give it away and bet that the audience will see talent where the publisher does not.  Giving his work away made Brazilian novelist Paulo Coelho successful.  At the same time, discretionary spend on entertainment and education will still be spent on education and entertainment.  That means new markets open up as others close.  If people can get recorded music for free, then they have more money to spend on live performances.  Or if they want something to enjoy at home, consumers will shift their spending from music to other content like video games, and this research suggests that is just what people have been doing.  Seen in that context, it makes perfect sense for music businesses to change tack; if they cannot sell direct to the consumer, sell to the people who make games instead.  This is innovation, and it is good for customers, even if painful for those businesses that lack the imagination or agility to keep pace with change.

America has been the great innovator, but having reached a pinnacle of power and influence, it may be tempted to sit back and exploit the accumulated wealth of its knowledge so far.  To do so would be the worst mistake possible for the American economy.  Innovation, experimentation, change - these are the ways to keep on creating world-beating formulas.  Monopolies of ideas are profitable only for those that control them.  That means monopolies should not be allowed to live on longer than fairly required to recoup the initial investment that was needed to turn the idea into a reality.  Money spent on enforcing and maintaining those monopolies for longer than needed is money not spent on developing alternative products.  New capabilities inevitably give rise to new markets and these are the real and pervasive threat to old monopolies.  The iPod allowed people to listen to as much music as they like, wherever they like, but it also gave birth to podcasting and a new world of creative opportunity.  Listening to a free podcast means less time to listen to an album of music that you pay for.  Sales of volumes of Encyclopedia Britannica collapsed in the face of rivals sold on CD-ROMs, and Wikipedia begs the question of why anyone should pay for reference texts.  News services are happy to reuse the amateur's view of major events, in the form of bystander photographs and videos, tweets and commentary from blogs.  Such amateur content squeezes the market for professionals, but that does not mean amateur content should be prohibited or limited, or that the reader or viewer would be better informed by content that only came from professional sources.  The US has got ahead by creating new ideas, not by only expoliting them.  Now, more than ever, piracy and the dissolution of barriers to entry mean new ideas have to be imagined and delivered at ever greater speed.  You can try to slow the progress of competitors, but if that is all you do, they will still overtake you soon enough.  America should avoid the temptation to pour more and more resources into protecting its current intellectual assets.  Intellectual assets only retain value if rivals lack the imagination to make something better.  In a world where ideas are spread ever more easily, the dominance of a good idea will be shorter and shorter.  America should stick to what it does best - investing in creating the future.  If that means encouraging the next generation of Benjamin Franklins, that can only be a good thing.

Eric is a business consultant, blogger, podcaster, chartered accountant and IS strategist. He helps global telcos with data integrity and small business with new media. Treasurer and founder of Pirate Party UK, he leads the campaign for copyright reform.
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