”Is it okay to shoplift if you disagree with the prices a shop charges?” -David Munns, EMI
I am utterly amazed by the volume of the ridiculously delusive claim of people ”stealing” copyrighted content on internet. It is practically impossible simply because theft can only refer to illegal possession of someone else’s physical property. One just can not steal non-material content. And I know this is nitpicking for some of you but the rhetorics of the opposite side is just as – and I would say much more – moronic.
The difference in the nature of physical and intellectual property is remarkable. The comparison between the two is completely useless and – more importantly – incredibly misleading. I thank professor Lawrence Lessig for putting the essential logic into words years before I even began to think about the problem.
Stealing refers to theft. And theft refers to unauthorized possession and use of someone else’s (physical) property. In order to steal you need to take property of someone else so that he or she will have no access to it. In other words, the property in question is rivalrous. My using of it takes decreases your ability to use it. Physical property is limited. There’s only so much land that everyone can claim. The more land I possess, the less there is left for you.
Intellectual property, however, is non-rivalrous. If I take a copy of your song, you’ll still be able to take advantage of it just the same. I can have my copy of a given content without taking that ability away from anyone else. So my use of intellectual content is not invasive. It doesn’t lessen your possibilities of the same use. Essentially, the resources are limitless. It’s in the nature of the intellectual content. It’s non-material content.
This is why it is simply impossible to steal copyrighted content on internet. Infringement is indeed another issue, but the sheer hypocrisy in comparing kids downloading music from p2p networks to terrorists (as Jack Valenti did) is far beyond common sense – and valid analogy.
Availability and copying. The problem with illegal sharing is the vast availability of (illegal) copyrighted content for free. And this problem is economic in the sense of huge capital markets. It creates losses for the right holders and distributors that engage in commercial action of making the content available. The same content available for free in p2p networks surely reduces the incentives for consumers to go out and purchase the product. But those big companies aren’t satisfied with just fighting against the availability of illegal content. They all strive to deny practically all copying of their copyrighted content. Surely the ability to copy a work obviously leads to the content being uploaded to p2p networks, but that’s not nearly always the case.
Here we need to look at how copyright infringing affects the market. First of all, we need to acknowledge the fact that each song downloaded from internet for free does not equal that song unsold in the market. That’s a completely false statement. Better way to measure the loss is to ask how much would one be willing to pay for a piece of music (or any other intellectual product) instead of downloading it for free. If the answer is zero dollars, then there’s no loss. When the answer is 5 cents, the loss is five cents, and NOT the factual price of the piece in the current market. By this analogy the losses turn out to be considerably lower from what the companies tend to claim.
Even if copyright law does protect some of the moral values associated with artistic and expressive content, it was originally created to protect commercial interests. The history of intellectual property law proves that morality had little to do with the birth of intellectual property law. Copyright legislation (along with all others of intellectual property law) was enacted to create and protect incentives for people to engage in innovation in capital market. This was in 18th century, the age where practically all commercial action required capital resource. The cost of producing intellectual content was so high that protect was needed for the end product. This protection came to be an exclusive right for the use of the product in question. In other words: a monopoly for the author over his or her intellectual property. No one else could take advantage of that product without asking permission from the original right holder.
Then came the 20th century, and new technologies. Radio, c-cassette recorders, VHS, Cable TV, p2p networks, etc. These are technologies that were seen as evil and illegal when they were introduced. Or at least the content producing entities claimed that. Any new technology supporting a better ability for free copying has confronted great resistance from the commercial parties in the market field. And this is currently the case for the entire concept of internet, as the social interaction in networks becomes more and more handy and popular. And at the same time, technology has come to the point where the cost of content production is in many cases only a fraction what it used to be.
Economies. The crucial term in this debate is economy. Economy as in how the communities work and how they set the their fundamental rules and goals. Traditionally we see possibly only one economy in the field of copyright. That’s economy is a commercial economy where copyright is a tool for protection of market share. This is where success and action in general is measured in commercial value, the money. Here copyright is not a protection to stimulate innovation. It is rather a means for protecting the possibility to increase market share and gain stronger position over competitors. Morality has nothing to do with this. It’s simple, it’s business. However, we hear it in political debate how especially large copyright holders appeal to such things as artistic value, innovation and respect.
Respect? Take Disney for example. They took content in public domain and shamelessly turned it into their (intellectual) property, essentially with no assignment to respect the original author. Also, big market looks out to satisfy consumers. This leads to the record companies playing it safe and choosing to assign artists that will fit into the current mainstream of air play and top 40’s. This is not innovation. It’s a monotonous and safe product line.
And how often do song writers like Max Martin for example get proper (moral) respect over Britney Spears or N’Sync? This is not supporting artistic value at least in a sense of paying tribute to the author.
The other side of appealing to moral incentives is even more hypocrite. According to Jack Valenti’s rhetoric, kids at home downloading music on their computers are terrorists. This is while RIAA – with the support of EMI and others – threatens private citizens with lawsuits over copyright infringement. Legally that might sometimes be valid. Then again, not nearly always. It’s fairly easy to threaten anyone with a lawsuit when you know they have now financial capability to stand up in court. This is essentially a force to settlement.
On top of that there’s licensing. Under copyright it is indeed possible to use some else’s copyrighted content, as long as you ask for a permission. But the problem is the fact that those permissions are not coming, unless you have the money to pay for them. And generally, you don’t.
So what does that mean?
Accessibility. Currently a vast majority of content protected by copyright is out of production and won’t fall into public domain for decades. So basically, there’s no way to access that content even if you were willing to pay top dollar for it. You would be able to log onto to internet net and find that content in just about every p2p network. But that’s illegal. So, in conclusion, the right holder isn’t willing – to take financial advantage of his or her content because there’s possibly no market for it, but at the same time there’s no permission to access it for free: ”If I have no use for it, I don’t want you to use it either.”
Creative commons. But the commercial market is not the only economy of creative and innovating communities. There are people who enjoy being creative and come up with things for the sake of playing around with ideas. These people gave birth to a lot of wonderful things. Wikipedia, Napster, the entire open source movement, etc. These are all outcomes of voluntary participation and free work. No money involved in the field of incentives. These people need the necessary incentive for the sake of innovation. And so this innovative action should be the measure of the effectiveness of the current the system.
Technology seems to produce incentives by making production easier. This relates to costs of production. And when costs of production decrease, competition increases. This is where holders of large market shares will surely stand up and call of restrictions to maintain their position. OR… they could adapt to the situation and change their strategy. Sadly enough, the latter does not often happen but instead lobbying has became an incredibly important strategy in maintaining and developing market share.
This leads to the debate of old vs. new. It has been the debate with all revolutionary inventions in the past few hundred years. And is also the case nowadays. Old business models require large capital resources and those with enough of it succeed better in the field. It is easier for them to function the less competition there is. New technology produces better possibilities for increasing competition. It’s obvious from the financial economic point of view for the companies to resist this change.
But is it good for everyone else. Monopolizing commerce does not encourage innovation. Restrictions on the access for information and content is generally fruitless and more importantly, a tool for restricting the freedom of speech.
Freedom of speech. It might be an indirect result of strong copyright regulation but it’s reality. Large copyright holders have in the recent history used their power to silence those that have spoken against them or their advantage, in one way or another. This was the case with Diebold Election Systems when students were spreading copies of the company’s internal email communication to spread the word the problem’s with the software on the company’s voting machines. DRM is another case. It effectively extends the possibility of a copyright holder to exercise his or her rights over to what the law should allow. There has been many more…
What is in the public domain is ours. The work that is not in the public domain is ours only when we are playing by the rules set by the right holder.
Back to encouraging innovation…
The fundamental doctrine behind all intellectual property regulation is essentially to produce incentives for creative work. We need to secure the innovator a possibility to take necessary and reasonable advantage of his or her innovation. This means we need restrictions on how people are allowed to access and use that content. But we also need a proper balance in this restrictive regulation. More restrictions is not always better. Given enough of power to the innovator to restrict and deny other people’s use of the content in question is more likely to lessen the innovators willingness to focus on further developing. On the other hand, where there’s too many requirements for asking permission – and those permissions might be hard to gain – there’s less incentive for others to innovate. Transaction costs are too high and the preparative work is too much. Are we not stifling innovation?
Registration. Incentives should be balanced with the required action for protection. This is generally the case with other intellectual property rights. He who wants his innovation to be protected, needs to call out for protection. In other words: registration. This is establishes the innovators wish to gain protection. It creates added costs as opposed to gaining protection automatically. But here the innovator sees the content is worth of protection. It’s economics. If we are to measure intellectual property in money (and not in cultural value for example), we need better ways to establish the value of content. This is exactly the problem with works out of print but still not in public domain. I would suggest that registration should be limited so that to avoid expiration. The right holder would have to re-register his or her work in order to maintain the right to protection under law. When registration is no more considered worthy, the work would fall into public domain, available for everyone.
Derivative works. All creative work builds on the past. This is a fact and so in this perspective calling for genuine innovation is hypocrisy. Not only is copyright automatic but the level for the requirement for the word ”original” is rather low, and so just about any creation reaches protection of copyright law. This leads to the conflict of many similar works created. But still, it is established in the law that derivative works – works that build on the work of others – are protected. You need to ask permission to create derivative work. And at the same time we have thousands of songs out there with a I-IV-V format, out of which all should by this logic be either derivatives OR none original. This is what the big companies are calling for. Strong monopoly over something that requires essentially no creative work. The concept of protecting derivative works in the current system is a paradox.
Free rider vs. free work. The political debate of copying copyrighted content is so strong in the side of the the company lobbyists that we need to sit back for a moment and think about the true nature of the problem. Here I will go back to the issue of ”stealing”.
As I pointed out, the problem infringements is not that people steal your content. That’s impossible. The content is still yours and you still have it. Someone just has now a free copy of your work, whether you wanted it or not. This could be called a free rider problem rather than theft. But what exactly constitutes free rider action? This term – just like theft – refers to profiting at the expense of someone else. So in order to free ride on someone else’s intellectual property you would have to benefit from using it in a way that’s taking away from that same possibility of the owner of the right. Logically, this means that one would have to engage in commercial action to be able to respond to this requirement. If I take a song of any given celebrity musician and make a song of my own considerably influenced by that, I would most likely do that only for the purpose making myself happy and should be be sharing it publicly, it would most likely be out of the pure willingness to let other people hear it. For free. I would not be making any profit at all. And it is more than likely that those supporting the original work would still pay for it because their tastes would consider my work inferior. I would cause little to no loss for the author of the work in question. This is not free riding.
On the other side of this analogy is the idea of the author accessing free work. Or better yet, free profit. Free in the sense that it requires no effort from the right holder. If I create a derivative work, should the original author be allowed to claim for me to pay for it just because he created the original work? Obviously this would depend on the amount of original work used in my derivative work. But here again I’m calling for the balance that’s not present in the system.
So the other side of the political debate could just as well be the claim of large record companies wanting free money and free work. It’s a moronic rhetorics to a degree but so is the analogy of theft.
The current system of copyright is benefiting essentially only the large companies holding those rights. It is hindering technological development. It is killing those possibilities that new technologies create. It changing the freedom to speak by changing the power to speak. It is reducing the variety of choices for consumers.
Copyright is essential. We need it and so I’m not calling for the abolition of copyright regulation. What I’m calling out for is the balance between the right of the author and the right of consumers and innovative commons. We have the law fundamentally supporting innovation, not stifling it. Proper balance is what gives us that innovation.
We need protection, not censorship.
