Ben Sheffner guest blogged here today on whether there are any lessons to be learned from the P2P trials. He asked me this question at the end of his post: “Do I believe suing individuals infringers can play a legitimate role in protecting copyright owners’ valuable assets.” I will answer the question clearly: yes. I believe the Electronic Frontier Foundation had earlier advocated filing suits against individuals rather than against the creators of mixed use software, so I don’t think the question particularly indicative of any right-left divide. In private practice I represented both copyright owners and those accused of infringement. Where litigation is the only way to resolve a dispute, my view is that’s what the courts are there for. But the courts aren’t there to stop innovation or to prop up outdated or poor business models, and they are a very poor choice over giving consumers what they want.
Ben quoted one of the Tenenbaum jurors who said of the jury “We wish there was another way that all parties could be satisfied. But this is a business, and they have a right to enforce their rights.” The last sentence is true enough, and 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 but something that creates economic value. Consumers were willing to buy authorized music after Napster, but we all agree the industry failed to do so. The industry only has itself to blame for what happened afterwards.
I am an enormous fan of the copyright industries and a very steady source of income to it: I buy about 300 books a year. I take my kids to see every kids’ movie, buy the DVD when it comes out, and also buy two copies of the same product as a Nintendo DS game (which can be $30-$35 times two); I have bought maybe a hundred DVDs of Nickelodeon TV show DVDs, I buy dozens of CDs and would buy a lot more if the industry had supported the SACD format. I take my kids to live musical events. As a musician (clarinet) I buy lots of sheet music. I buy four hard copy newspapers a day and subscribe to ten monthly magazines a month. I have not bought any of these because they were copyrighted; indeed most of the sheet music is in the public domain but I am still happy to pay good money for a nice edition. The most respect that we can pay to copyright industries is to think only about buying such products and not copyright. The music industry forgot this.
Tuesday, August 11, 2009
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20 comments:
Welcome back to the world of legal blogging, Bill. Yours is a well informed, thoughtful, and balanced voice, and it was missed by all.
Ah, Launchcast. I loved that service so much that I paid for it to avoid the commercials--and yes, I bought a ton of music because of its algorithms. Then Yahoo!'s anti-customer service drove me away, and I wouldn't be at all surprised if some of the most annoying "features" came from copyright owner demands. Now I get my new music through blogs and spend a lot less per year on music.
"...indeed most of the sheet music is in the public domain but I am still happy to pay good money for a nice edition."
So what you're saying is that the creative work has no value; that you're buying a nice piece of paper with attractive printing, and the fact that the printing can be interpreted as music is just a handy bonus feature. Would you really be as willing to own that fancy paper with nice printing if it were merely random gibberish?
Halojones-fan, no I am not saying that creative work has no value; quite the opposite. Creative work has fantastic value, but the value emanates not from a government granted privilege. My points are two-fold: (1) even an amazingly creative work that would be bought, won't be if the distributor blocks its distribution or makes the terms of its access unappealing; (2) a piece of junk that no one will buy has no value because it is junk, and giving it a copyright can't change that. From my recitation of my buying habits, it should be clear that I put my money where my mouth is on this issue.
Bill-- You talk about the industry as if it moves in its own monolithic step. While the record companies can get together and sue a Napster/Launchcast etc., they cannot as easily get together and launch a service due to, among other things, anti-trust laws. So, it's very easy to say the "industry" should have come up with an alternative to Napster more quickly, but that ignores so many facts and factors including that it had to do so in competition with a free service (Napster) that aggregated all copyright owners' content without the pesky problems of making sure it had all the rights, mechanical licenses, a system for tracking payments etc etc etc. I'm surprised to see you take such an easy but ill-informed potshot without providing some of the counterbalancing context.
Of course copyright creates economic value.
If you could download any CD or DVD for free, why would you pay for it?
For the packaging, right? Of course, without copyright, all of the packaging and additional content can be copied for free as well.
Maybe you meant that copyright doesn't replace the need to develop quality works as well a modern business model. On that point we agree.
Facebone, you are of course correct that no industry moves in a monolitihic step, at least always. It is also true that it is easy for those who use copyright owners' works without permission to ignore pesky problems like rights clearance and anti-trust laws. But iTunes proved that it was possible for the industry to overcome these problems. Where there is a will there is a way; my view, backed by well-informed people I quote in my book and whom are also quoted in "Appetite for Self-Destruction" is that the will at the time of Napster and for a number of years afterwards, was to stop or at least retard the development of a digital download market in order to preserve the market for CD sales and the album format. That changed, of necessity, and when it did, all of a sudden the licensing and antitrust hurdles were overcome. There are other counterbalancing contexts too that I provide on pages 3-5 such as the ability of dual markets to co-exist, the difficulty of figuring out if a new technology will be commercially successful, and reshaping long standing business practices to a new environment. None of that should be slighted.
Liadrin, my point takes place at an earlier stage than your remarks. Certainly once consumers have indicated through purchasing, that a work has value to them, if others come along and then copy it for free, copyright owners are being deprived of value. And copyright should be used to stop such free-riding. My point is that copyright is a right to exclude -- hence it is called a bundle of exclusive rights. The right to exclude is generally thought of as a negative right, the right to stop those from doing things with your work you don't want them to. The right also lets you license people to use the work if you want them to. But none of this matters if your work is like the movie Ishtar: who cares if it has copyright? Did that help the studio at all? I think not; they would have been lucky if someone cared enough to copy it. To me, copyright becomes a worthwhile right once consumers have shown the work has value to them, and at that point copyright functions as a way to prevent free-riding or interference with contractual relationships. Copyright doesn't create the value though, it only prevents pre-established value from being siphoned off.
"To me, copyright becomes a worthwhile right once consumers have shown the work has value to them..."
I'm not sure where you're going here...are you saying that things should be released for free at first and you only have to pay for them if they get popular?
"[A] piece of junk that no one will buy has no value because it is junk, and giving it a copyright can't change that."
But how do we know something is "junk" before it's released? And who's the arbitrator of what is and isn't "junk"? Is there going to be some kind of Media Merit Board that sets prices for every creative work?
Why shouldn't the creator of a work have the right to define the requirements for experiencing that work? (requirements being things like price, possible formats or venues for experience, length of time the experience is available, redistribution, and so on.)
"[E]ven an amazingly creative work that would be bought, won't be if the distributor blocks its distribution or makes the terms of its access unappealing..."
Ah-ha. So you aren't saying that things shouldn't have prices; you're just arguing that in some cases the price is higher than you're willing to pay.
...except that you've shot yourself in the butt, here, because you aren't arguing against copyright anymore. You're just whining about how "stuff costs too much these days".
Halojones-fan, I am not saying any of the things you think I am.
"the courts aren’t there to stop innovation or to prop up outdated or poor business models, and they are a very poor choice over giving consumers what they want."
What I'd like to know is what the legal basis is or giving consumers what they want?
If a furrier wants to use a photo of a seal pup and I either decline the offer, or ask some exorbitant price are they then entitled to use it anyway?
It was my impression that I didn't have to provide any one with anything if I didn't want to, and I could pick and choose who I allow to use a work and in what contexts, when did that change?
Bill- To acknowledge the industry doesn’t move in monolitihic step but then to declare that there was a blanket “will … to stop or at least retard the development of a digital download market in order to preserve the market for CD sales and the album format” still minimizes the numerous forces at work. When Apple developed the itunes store and was able to strike individual deals with content providers, that was a game changer. Would it have been nice for content providers to strike a deal with Napster? Sure. Should the fact that no deal was struck be placed entirely at the feet of the content providers? Of course not. Just as where there’s a will, there’s a way, it takes two to tango—in this case more than two. It’s not that “all of a sudden the licensing and antitrust hurdles were overcome”; the antitrust issues required individual deals, as opposed to collective negotiations which of course slowed the process down. Even then there were investigations and lawsuits over the results from the class action bar.
On another point, of course you are right that copyright doesn’t create value in, for example, a valueless work (like I guess Ishtar). But the absence of copyright can destroy a work’s value. In the case of music, some music may have more value than other music (indeed, that’s a “value judgment”) but the rampant ignorance of copyright by masses of people essentially devalued the maximum value that any music could have (essentially commoditizing all music). If a work’s value is determined by a person’s willingness to buy it, establish a competing system where the work is free obviously has an impact on some consumers’ willingness to buy it. The right to exclude then becomes meaningless as it cannot be practically enforced. That’s unfortunately what you are seeing with the Tenenbaum-like lawsuits—the copyright owners can’t practically (or economically) exclude everyone so they impose penalties that may be disproportionate on any particular individual but of course proceed against many fewer individuals than they have the right to pursue. That sure does create bad press, bad will and probably bad karma, but one can see why it’s a choice they tried.
Overton, it is not a question of the presence of a legal basis for being a bad business person; the question is whether one views one's role in being in business to sell things to consumers or not. You can of course choose to create something and then not sell it. Systemically though, the purpose of copyright is to get things to the public, and at that level there is no public policy reason for giving you a copyright.
Facebone, thanks for more of the background. I am sure I and others underestimate the problems. I do make the "it takes two to tango" point about Napster on page 2 of the book where I say "Napster's executives are said not to have been 'exactly open-minded either.'" I am not putting the entire argument on not making a deal with Napster. My point is that there was no will at that point to effectively license digital downloads regardless of what the service was. That is the essence of Edgar Bronfman's acknowledgment that the industry (and note he too was speaking in the imperial "we" of the industry as a whole) had "gone to war with consumers by denying them what they wanted and could otherwise find; as a result of course, consumers won." (page 1). I would think Mr. Bronfman would be considered an informed party, and he was one of the execs who tried to make a deal with Napster. His "as a result" language indicates to me recognition that the industry bears some, and maybe a lot of the responsibility, so what happened afterwards. At the same time, there will always be scofflaws who won't pay for things where there are effective licensing schemes, and for those folks, absolutely lawsuits are necessary. But to me, based too on Bronfman's statement, the industry got itself into a spot where it felt it had to engage in massive lawsuits.
Patry, do you have a response other than "nuh-uh"?
Again: You say that "copyright becomes a worthwhile right once consumers have shown the work has value to them." I really don't understand what you mean by this.
I guess maybe you're saying that the existence of copyright does not lead to an expectation of revenue derived from providing copies of creative works.
Which...well, duh! Of course it doesn't. But the converse is also true--that irrational expectations of potential revenue do not excuse violations of property rights. I could own a thousand acres of toxic-waste dump and charge people a million billion dollars to walk around in it for five minutes, but if someone sneaks past the fence I can still sue them.
"Systemically though, the purpose of copyright is to get things to the public..."
Yes, in the sense that being allowed to purchase the deed to a plot of land creates public benefit--by allowing the owner to exploit that land to create wealth, and therefore increase the overall amount of wealth in society.
Halojones-fan. Yes, I was saying that the existence of copyright does not lead to an expectation of revenue; they is simply no correlation between the popularity of a work and its copyright status. I certainly agree with the converse, that because a work is popular one can copy it. My larger point is that for those who are engaged in mass marketing to the public, the place to begin is with consumer demand, not consumer control.
First - full disclosure - I am a small independent label owner (only about a year into the business), a law student (3L), former performing musician and music lover.
I think it is unfair and unrealistic to expect the jury members to fully comprehend the laws on which they based these damages, and I don't believe that most Americans over the age of 35 can really be expected to relate to internet-savvy Gen-X & Y'ers. I only point this out to detract from Ben's use of these juries as a gauge for the American public. The current aggregate opinion of the public at large should not be the focus here, but rather it should be the future of American and global intellectual property law. These policies and business practices will most likely be determined by the X's and Y's, and as many content providers are finding out, controlling internet consumers isn’t a realistic option. The laws will invariably change – how, I don’t pretend to know – but the fact is the current system is not equipped to deal with consumers who can take what they want, en masse, at will.
As a small (intellectual property) business owner, I absolutely feel that some manner of copyright protection is necessary. What bothers me is that, as a music fan, the major record labels and media outlets have long dominated creation, consumption and broadcast of cultural products. I would like to see these suits (or at least this strategy, the law is what it is right now) fail - returning some amount of control to consumers of culture will enrich the industry as well as our overall cultural output. Ultimately, I think the strategy is destined to fail.
While the industry is not a "monolith" exactly, its players frequently will act in tandem and use their lobbying and economic power to achieve ends they view as favorable to their interests. There is nothing inherently wrong with this, except that consumers (and to some extent the ground-level creators) are often left out of the discussion entirely and have no such power. Moral questions aside, the internet has provided both consumers and creators with the means to circumvent these major players entirely. The playing field has been leveled and it is up to us, the new content providers, to come to a compromise with consumers and creators that the older industry players are unwilling to make.
-- John
"You can of course choose to create something and then not sell it."
Is copyright solely about selling stuff?
"Systemically though, the purpose of copyright is to get things to the public, and at that level there is no public policy reason for giving you a copyright."
One may make material available for use by individual users, academic research, a non-profit, or online encyclopedia. It still gets to the public, whilst not allowing distribution via some unsavoury route like News International.
A local council use a photo of a bug in their wildlife news - OK. Pesticide company uses it on a product label - not OK.
I noticed the other week a large UK based Publishing House accessing pages on my site over a number of days. Irrespective of whether I'm selling the images to others or not, I'd be mightily annoyed if they were to use any of the images.
Some may want to control the context of how a work appears, that it isn't used by 'hate groups' for example. Others may object to their family photos being used for sexual purposes. Whether or not the images are being sold is immaterial.
halojones-fan, I think that you have a fundamental misunderstanding of the purpose of copyright. It is not designed so that the creator of a work can mine it for wealth, as you suggest personal property rights are (and I think that, itself, is an overly-narrow view) and thus enrich society. It is designed as a tool to advance sociocultural and scientific understanding by providing an incentive for those creatives to share their work with society. It so happens that the form this incentive takes is the granting of a monopoly for the work's creator for a limited time.
Your suggestion that people should not infringe copyright simply because of the cost of the work is one I hearily share (as, I believe, does Mr. Patry), but I also believe that current copyright law is directed at the purpose you originally ascribed in your analogy-- to allow creators (and when I say creators, I actually mean the publishers who obtain the creator's rights to a work) to mine their works for wealth far longer than they need be allowed to in otder to convince them to share their works with society.
Of the books I buy, around 60% more are for my kids, especially chapter book series like Geronomio Stilton, Magic Tree House (and the research guides), Magic School Bus, Encyclopedia Brown. I think it very important that they become vocarious readers early and learn the joy of (hardcopy) books.
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