The Other Hopeless War Started in 2003

by on November 4, 2005 · 38 comments

The EFF has a new study out surveying the results of more than two years of RIAA lawsuits against file-sharers. I’m ordinarily sympathetic to the EFF’s arguments, but in this case, I agree with Adam:

OK Fred, then what exactly IS the answer to the P2P dilemma? Because you don’t favor individual lawsuits, you don’t favor P2P liability, or much of anything else. This is what infuriates me most about the Lessig-ites; they give lip service to the P2P problem but then lambaste each and every legal solution proposed. In my opinion, if you can’t even support the lawsuits against individual users, then you essentially don’t believe in ANY sort of copyright enforcement.

People who don’t like the RIAA’s litigous agenda need to come up with a workable alternative. Too many people on the anti-RIAA side like to criticize every attempt to enforce current copyright laws without suggesting alternative enforcement mechanisms, and without proposing an alternative legal regime. I’m not comfortable with simply shrugging at wide-spread piracy and telling the RIAA to lower their prices and stop whining.

I do, however, have two caveats. First, I think the EFF’s report does highlight some abuses. Getting sued by a deep-pocketed corporation is an extremely intimidating experience, and it’s probably true that some of the RIAA’s targets were wrongly accused. So we should all be thinking about the legal balance that’s created between the RIAA and accused file-sharers. It might be that a legal regime designed to go after commercial pirates is too heavy-handed to deal with individual file sharers.

Secondly, I think the EFF might be right on the empirical question: that in the long run, these kinds of lawsuits aren’t going to prevent widespread use of P2P software. That doesn’t make piracy OK, and it doesn’t mean the RIAA should stop suing people, but it does mean that they should be thinking hard about what they’ll do if, a decade and 100,000 lawsuits from now, they find that peer-to-peer software is more popular than ever. It might be that there just isn’t any way to stop piracy short of shutting down the Internet. If that’s true, then at some point laws are going to have to change to reflect that reality. It would clearly be a bad idea to have a law that’s universally ignored. But I have no particular insights about what the new legal regime ought to look like.

  • Marcel Popescu

    Here’s a workable alternative:

    In my opinion, if you can’t even support the lawsuits against individual users, then you essentially don’t believe in ANY sort of copyright enforcement.

    What exactly makes it unworkable?

  • Marcel Popescu

    Here’s a workable alternative:

    In my opinion, if you can’t even support the lawsuits against individual users, then you essentially don’t believe in ANY sort of copyright enforcement.

    What exactly makes it unworkable?

  • http://www.binarybits.org/ Tim

    There’s nothing inherently unworkable about not enforcing copyright. But I don’t think that’s the stated position of EFF, and it’s certainly not a stance they emphasize. The argument is usually “yes, we’re in favor of enforcing copyright, but X goes too far.” Except that they say the same thing for every conceivable X.

  • http://www.binarybits.org/ Tim

    There’s nothing inherently unworkable about not enforcing copyright. But I don’t think that’s the stated position of EFF, and it’s certainly not a stance they emphasize. The argument is usually “yes, we’re in favor of enforcing copyright, but X goes too far.” Except that they say the same thing for every conceivable X.

  • Anonymous

    Alternative? Isn’t that the *recording industry’s* job? :) After all, they’re the ones whose model is being eaten out from under them. In what other industry is it expected that people outside that industry are responsible for reinventing the business model for those companies too short sighted to change themselves…

    However, if you really want an answer, I’ve got one: you don’t need to do anything. Isn’t this site all about supporting the open market. Let’s let the free market do its wonders. Right now, it looks like that market is saying that plenty of people value music and other entertainment files at $0 — so that’s telling you something.

    At the same time, since distribution costs are spread out through the system, costs drop as well.

    So… hmm… we’ve got a product that people eagerly want, and the replication and distribution costs are essentially nil. Hell, that sounds like a HUGE opportunity to me. It means that all that music has tremendous promotional value, if only the record labels would learn to leverage it as such. Instead of thinking about how they can sell songs, look at how they can use free songs to sell plenty of other stuff.

    Such as? The obvious: concert tickets, t-shirts, CDs (yes, some people still want them) and other such merchandise. Slightly less obvious: sponsorships. Get advertisers to sponsor the bigger name bands. Even less obvious: Sell access to the band. Have a “fan club” that costs some amount of money to join, and give those fans better access to the band. Chat rooms, first chance at tickets, chances to meet the band. Maybe a contest to have the band play your backyard or something silly like that.

    What you may end up with is fewer megastars, but a lot more successful acts that can support playing music, and there’s still room for “labels” to help with the marketing and administration of it all. And, if you look at historical trends, getting more acts to be successful, rather than just a few superstars is a better recipe for making a much larger overall pie for the industry (if they’d only embrace it…).

    And, I mean, I’m not a very creative person and I came up with all of this. I’m sure others could come up with plenty of other ways. Hell, one band even set up their own travel agency to help fans see them at shows. The music is a promotion to get people to travel… So many possibilities, and no one needs to get sued, the market gets bigger, and no grandiose “solution” is needed. The market solves everything by recognizing that the music is simply a promotional good. The job, then, is to figure out what it promotes.

  • Anonymous

    Alternative? Isn’t that the *recording industry’s* job? :) After all, they’re the ones whose model is being eaten out from under them. In what other industry is it expected that people outside that industry are responsible for reinventing the business model for those companies too short sighted to change themselves…

    However, if you really want an answer, I’ve got one: you don’t need to do anything. Isn’t this site all about supporting the open market. Let’s let the free market do its wonders. Right now, it looks like that market is saying that plenty of people value music and other entertainment files at $0 — so that’s telling you something.

    At the same time, since distribution costs are spread out through the system, costs drop as well.

    So… hmm… we’ve got a product that people eagerly want, and the replication and distribution costs are essentially nil. Hell, that sounds like a HUGE opportunity to me. It means that all that music has tremendous promotional value, if only the record labels would learn to leverage it as such. Instead of thinking about how they can sell songs, look at how they can use free songs to sell plenty of other stuff.

    Such as? The obvious: concert tickets, t-shirts, CDs (yes, some people still want them) and other such merchandise. Slightly less obvious: sponsorships. Get advertisers to sponsor the bigger name bands. Even less obvious: Sell access to the band. Have a “fan club” that costs some amount of money to join, and give those fans better access to the band. Chat rooms, first chance at tickets, chances to meet the band. Maybe a contest to have the band play your backyard or something silly like that.

    What you may end up with is fewer megastars, but a lot more successful acts that can support playing music, and there’s still room for “labels” to help with the marketing and administration of it all. And, if you look at historical trends, getting more acts to be successful, rather than just a few superstars is a better recipe for making a much larger overall pie for the industry (if they’d only embrace it…).

    And, I mean, I’m not a very creative person and I came up with all of this. I’m sure others could come up with plenty of other ways. Hell, one band even set up their own travel agency to help fans see them at shows. The music is a promotion to get people to travel… So many possibilities, and no one needs to get sued, the market gets bigger, and no grandiose “solution” is needed. The market solves everything by recognizing that the music is simply a promotional good. The job, then, is to figure out what it promotes.

  • http://www.techdirt.com/ Mike Masnick

    Hmm. Weird. That’s my post above. Not sure why my name got deleted. Might have had something to do with the preview button that seemed to not work properly.

  • http://www.techdirt.com/ Mike Masnick

    Hmm. Weird. That’s my post above. Not sure why my name got deleted. Might have had something to do with the preview button that seemed to not work properly.

  • http://www.binarybits.org/ Tim

    However, if you really want an answer, I’ve got one: you don’t need to do anything. Isn’t this site all about supporting the open market. Let’s let the free market do its wonders. Right now, it looks like that market is saying that plenty of people value music and other entertainment files at $0 — so that’s telling you something.

    “The free market” includes protection of peoples’ rights, and in our current legal regime that includes intellectual property rights.

    I hate to use this analogy because I think it’s often mis-used by the RIAA, but I think it fits in this case: you could just as easily say a shoplifter is valuing candy bars at $0. No one would seriously contend that the retailer’s response should be to give away candy bars for free and sell advertising in his stores.

    The kind of alternative I’m looking for is a policy alternative, not an alternative business plan. If copyright in its current form is doomed, then we need to face up to that honestly and come up with a new set of laws that work in the new technological environment. Maybe that will means that in the future there won’t be any copyright at all, but if so, that requires a change by Congress, it’s not acceptable for people to just start ignoring laws they don’t like.

  • http://www.binarybits.org/ Tim

    However, if you really want an answer, I’ve got one: you don’t need to do anything. Isn’t this site all about supporting the open market. Let’s let the free market do its wonders. Right now, it looks like that market is saying that plenty of people value music and other entertainment files at $0 — so that’s telling you something.

    “The free market” includes protection of peoples’ rights, and in our current legal regime that includes intellectual property rights.

    I hate to use this analogy because I think it’s often mis-used by the RIAA, but I think it fits in this case: you could just as easily say a shoplifter is valuing candy bars at $0. No one would seriously contend that the retailer’s response should be to give away candy bars for free and sell advertising in his stores.

    The kind of alternative I’m looking for is a policy alternative, not an alternative business plan. If copyright in its current form is doomed, then we need to face up to that honestly and come up with a new set of laws that work in the new technological environment. Maybe that will means that in the future there won’t be any copyright at all, but if so, that requires a change by Congress, it’s not acceptable for people to just start ignoring laws they don’t like.

  • Christopher

    The best thing that we could do in terms of copyright is to severly limit it, like make copyright terms at the most 10 years.
    Copyright is too often used today to mean “perpetual money coming in our pocket”, which is not what the founders had meant for it to be.

  • Christopher

    The best thing that we could do in terms of copyright is to severly limit it, like make copyright terms at the most 10 years.
    Copyright is too often used today to mean “perpetual money coming in our pocket”, which is not what the founders had meant for it to be.

  • http://www.licquia.org/ Jeff Licquia

    I hate to use this analogy because I think it’s often mis-used by the RIAA, but I think it fits in this case: you could just as easily say a shoplifter is valuing candy bars at $0. No one would seriously contend that the retailer’s response should be to give away candy bars for free and sell advertising in his stores.

    Sure, but that’s because there’s a good argument that the shoplifter’s valuation is wrong. If you pass a law saying that candy bars must be free, no candy bars would be made. That’s evidence that candy bars are worth more than zero.

    Besides, the analogy isn’t as cut-and-dried as that. Take another analogy from the physical world: prescription drugs. Lots of people are seriously contending that drug manufacturers should sell drugs below cost by government fiat, including the leaders of governments considered to be quite smart otherwise. Why? It’s perceived that the prices of many prescription drugs are way off kilter. Isn’t that what a lot of anti-RIAA folks are saying here, too?

    And it’s a fact of history that music will continue to be produced even at zero price. For large swaths of history, music was primarily given away for free (once every Sunday, at least). In fact, some of the music produced for free consumption is considered today to be some of the best music ever made.

    Given that, I don’t see any problem with telling the music industry to justify its business model in the face of societal changes that make its role look less and less relevant as time goes on.

  • http://www.licquia.org/ Jeff Licquia

    I hate to use this analogy because I think it’s often mis-used by the RIAA, but I think it fits in this case: you could just as easily say a shoplifter is valuing candy bars at $0. No one would seriously contend that the retailer’s response should be to give away candy bars for free and sell advertising in his stores.

    Sure, but that’s because there’s a good argument that the shoplifter’s valuation is wrong. If you pass a law saying that candy bars must be free, no candy bars would be made. That’s evidence that candy bars are worth more than zero.

    Besides, the analogy isn’t as cut-and-dried as that. Take another analogy from the physical world: prescription drugs. Lots of people are seriously contending that drug manufacturers should sell drugs below cost by government fiat, including the leaders of governments considered to be quite smart otherwise. Why? It’s perceived that the prices of many prescription drugs are way off kilter. Isn’t that what a lot of anti-RIAA folks are saying here, too?

    And it’s a fact of history that music will continue to be produced even at zero price. For large swaths of history, music was primarily given away for free (once every Sunday, at least). In fact, some of the music produced for free consumption is considered today to be some of the best music ever made.

    Given that, I don’t see any problem with telling the music industry to justify its business model in the face of societal changes that make its role look less and less relevant as time goes on.

  • http://free.hostdepartment.com/f/fukudasan/ fukudasan

    Perhaps what we need to remember here is that in the past, writers, artists etc. were remembered for what they did, not for how much money they made. If copyright protection is so important, what happened to the copyright on the works of Shakespeare, or William Langland (author of Piers Plowman), or Socrates or Plato? Who has the copyright on the works of Claudio Monteverdi or Ludwig van Beethoven? Shouldn’t that be their families rather than some big corporation?

    Before we discuss any of this we need to admit one thing: humans are led by people who have long realised that the desires of the ordinary man, woman or child define their world and that it is these things by which their minds (and therefore their actions and their whole lives) can be controlled. What we are seeing here is merely the latest incarnation of what in the past was primarily the preserve of religion and parts of the state apparatus. The ancient Greeks (Plato or Socrates, I forget which right now) argued that a good life can be had by simply pursuing those things which bring happiness. So a politician realises immediately that by promising things at election time, they can get into power. It doesn’t matter that they never actually deliver; when the next election time comes, people still want the things they promised the last time, and they still swallow it all. This is one reason why democracy can never improve without some major paradigm shift. Drum into peoples’ heads that there is a fabled state called “happiness’ which may in fact be achieved one day before they die, and you can control their minds forever, generation after generation.

    Now we fast forward to the twentieth century and in the 1960s in particular, the recording companies started to realise the awesome power of teenagers (in particular) as a source of gullible and largely uncritical income. The companies have been addicted to this ever since and the final result is a sick market dominated by pointless, plastic, off-the-shelf boy and girl bands. My old mate Neil back in Cambridge (England, not Massachusetts) used to say that what pop needed was a big kick up the backside, as happened in the late ’70s in the case of Punk. And people don’t want this sort of modern, squeaky-clean, gift-wrapped crap, either. How can anyone be surprised that they don’t want to pay for it?

    The one thing that no-one ever seems to mention is that the Internet is, by its very definition, a file-sharing system; go to a web site and what you see is a collection of files, not one of which is the original but a copy of the original. People see written content online for free unless they pay a subscription, and who wants to pay a subscription when they can get the same stuff elsewhere for free? The Internet cannot function any other way, because we cannot transport any value-added product other than text or animated video from one place to another by this means. otherwise we would be in a wonderful Star Trek-style utopia where you order something online and it suddenly materialises right next to you.

    Perhaps the media industries have jumped on the bandwagon too soon before realising that a mature system is needed to sell their wares in an acceptable way; or perhaps their biggest mistake is not to realise that they were presented with a golden opportunity and wasted it because of their stupid old-fashioned attitudes about copyright and the intrinsic worth of what they were trying to flog to the Great Unwashed. Because the inevitable result of mass production, classically, has been that in the face of competition and the unwillingness of the customers to continue paying the same high cost once the production costs had come down, the purchase cost has to fall. So now the media companies are presented with a new paradigm, according to which the production costs are virtually zero (because it is all electronic and copies are made from a single or restricted group of original masters) and everyone (including their customers) knows it.

    If you enter the world of purely electronic media, production costs on an established product (think here of all the old LPs and films that people like and want to watch, not the latest cack from Hollywood) fall virtually to zero because you make no physical product apart from the master, which is itself in digital form; if the customer wants the product and decides to commit it to permanent media, it is the latter who pays for this (buys a PC, buys software, pays for electricity and ISP access, pays for the physical media for recording) and not the vendor. Conclusion: the intrinsic purchase price of the original is reduced by new technology, and this does not reflect the “use-value” of the article in question because that is a personal attribute of the customer. This is a key factor which vendors fail to understand.

    We need to find an acceptable way to protect the “rights” of the copyright owner, but perhaps the reason for the antipathy in this regard is the fact that it is the creator/performer who is respected for their creativity and not the media companies themselves, who tend to be regarded as parasites upon the creators. The media companies should change their world-view from being the “providers” (because the real “providers” are the “creators”, not the media through which they are propagated) to being the “vehicle” through which these things are mediated. It follows that the “rights” attendant upon this relate to production costs and “reasonable” profits, and nothing else. We remember the likes of Plato and Socrates, Beethoven, Mozart, Lao Tzu, even the likes of Confucius not because of who their publishers were, but because of what they created. All the money in the world does you no good once you are dead; those who feed off your creativity are parasites and nothing else, mere propagators of copies rather than creators of originals.

    I think that it is against this cultural backdrop that this issue should be judged. The law needs to recognise that media companies may pay for the work of creators but the idea of copyright law was to protect the legitimate interests of the latter, not the former. Rather, the law needs to recognise that there is a “fair use” inherent in the purchase of any product, be it a favourite *.avi file, an *.mp3 music file, a book or anything else in which the creative process inheres. But the vendors cannot claim in perpetuity that they – and only they – have the exclusive rights to reproduction, only to the edition of that reproduction. Otherwise the popular culture passes into the pockets of the plutocrats.

    Now we turn to the question of downloads. The old 20th-century business model of a physical copy of a copyright article having an intrinsic worth for which a fixed price should be paid is outmoded and must be discarded, simply because we are now in an age of infinite reproduction with high fidelity to the original, and obeying the classical rules of mass production, the cost of reproduction must fall down as far as manufacturing processes will allow, and in the case of anything transmitted over the Internet, as we have seen, much of the cost is borne by the consumer rather than the vendor. What we are left with is essentially a residual cost, which is notionally the financial equivalent of the “rights” of the seller. And for large numbers of the product to ship successfully, history suggests that this residual has to be as small as possible.

    This is the situation with which publishers are faced nowadays: each new technical innovation has always resulted in undercutting the competition rather than increasing profits directly from the sales of individual products, because more profits are won from shipping the product in bulk rather than as single items; just ask the old Mediaeval publishers, for whom each document was hand-written on parchment or expensive hand-made paper – they could not survive after the invention of movable type, except by adopting the same technology themselves. Was the result detrimental? Short answer: NO – instead, we now have extensive records which were easier to reproduce. If the Mediaeval publishers had killed movable type, there would be no mass communication today, because although the form has changed somewhat, the content remains communicable, and that in itself is priceless. But it was innovation which brought us these dubious joys, not staying in the days of hand-written parchments. And there is the real lesson of history.

    (Writer’s note: This was such a good session, I will put this up on my blogs, too! ^_^)

    fukudasan

  • http://free.hostdepartment.com/f/fukudasan/ fukudasan

    Perhaps what we need to remember here is that in the past, writers, artists etc. were remembered for what they did, not for how much money they made. If copyright protection is so important, what happened to the copyright on the works of Shakespeare, or William Langland (author of Piers Plowman), or Socrates or Plato? Who has the copyright on the works of Claudio Monteverdi or Ludwig van Beethoven? Shouldn’t that be their families rather than some big corporation?

    Before we discuss any of this we need to admit one thing: humans are led by people who have long realised that the desires of the ordinary man, woman or child define their world and that it is these things by which their minds (and therefore their actions and their whole lives) can be controlled. What we are seeing here is merely the latest incarnation of what in the past was primarily the preserve of religion and parts of the state apparatus. The ancient Greeks (Plato or Socrates, I forget which right now) argued that a good life can be had by simply pursuing those things which bring happiness. So a politician realises immediately that by promising things at election time, they can get into power. It doesn’t matter that they never actually deliver; when the next election time comes, people still want the things they promised the last time, and they still swallow it all. This is one reason why democracy can never improve without some major paradigm shift. Drum into peoples’ heads that there is a fabled state called “happiness’ which may in fact be achieved one day before they die, and you can control their minds forever, generation after generation.

    Now we fast forward to the twentieth century and in the 1960s in particular, the recording companies started to realise the awesome power of teenagers (in particular) as a source of gullible and largely uncritical income. The companies have been addicted to this ever since and the final result is a sick market dominated by pointless, plastic, off-the-shelf boy and girl bands. My old mate Neil back in Cambridge (England, not Massachusetts) used to say that what pop needed was a big kick up the backside, as happened in the late ’70s in the case of Punk. And people don’t want this sort of modern, squeaky-clean, gift-wrapped crap, either. How can anyone be surprised that they don’t want to pay for it?

    The one thing that no-one ever seems to mention is that the Internet is, by its very definition, a file-sharing system; go to a web site and what you see is a collection of files, not one of which is the original but a copy of the original. People see written content online for free unless they pay a subscription, and who wants to pay a subscription when they can get the same stuff elsewhere for free? The Internet cannot function any other way, because we cannot transport any value-added product other than text or animated video from one place to another by this means. otherwise we would be in a wonderful Star Trek-style utopia where you order something online and it suddenly materialises right next to you.

    Perhaps the media industries have jumped on the bandwagon too soon before realising that a mature system is needed to sell their wares in an acceptable way; or perhaps their biggest mistake is not to realise that they were presented with a golden opportunity and wasted it because of their stupid old-fashioned attitudes about copyright and the intrinsic worth of what they were trying to flog to the Great Unwashed. Because the inevitable result of mass production, classically, has been that in the face of competition and the unwillingness of the customers to continue paying the same high cost once the production costs had come down, the purchase cost has to fall. So now the media companies are presented with a new paradigm, according to which the production costs are virtually zero (because it is all electronic and copies are made from a single or restricted group of original masters) and everyone (including their customers) knows it.

    If you enter the world of purely electronic media, production costs on an established product (think here of all the old LPs and films that people like and want to watch, not the latest cack from Hollywood) fall virtually to zero because you make no physical product apart from the master, which is itself in digital form; if the customer wants the product and decides to commit it to permanent media, it is the latter who pays for this (buys a PC, buys software, pays for electricity and ISP access, pays for the physical media for recording) and not the vendor. Conclusion: the intrinsic purchase price of the original is reduced by new technology, and this does not reflect the “use-value” of the article in question because that is a personal attribute of the customer. This is a key factor which vendors fail to understand.

    We need to find an acceptable way to protect the “rights” of the copyright owner, but perhaps the reason for the antipathy in this regard is the fact that it is the creator/performer who is respected for their creativity and not the media companies themselves, who tend to be regarded as parasites upon the creators. The media companies should change their world-view from being the “providers” (because the real “providers” are the “creators”, not the media through which they are propagated) to being the “vehicle” through which these things are mediated. It follows that the “rights” attendant upon this relate to production costs and “reasonable” profits, and nothing else. We remember the likes of Plato and Socrates, Beethoven, Mozart, Lao Tzu, even the likes of Confucius not because of who their publishers were, but because of what they created. All the money in the world does you no good once you are dead; those who feed off your creativity are parasites and nothing else, mere propagators of copies rather than creators of originals.

    I think that it is against this cultural backdrop that this issue should be judged. The law needs to recognise that media companies may pay for the work of creators but the idea of copyright law was to protect the legitimate interests of the latter, not the former. Rather, the law needs to recognise that there is a “fair use” inherent in the purchase of any product, be it a favourite *.avi file, an *.mp3 music file, a book or anything else in which the creative process inheres. But the vendors cannot claim in perpetuity that they – and only they – have the exclusive rights to reproduction, only to the edition of that reproduction. Otherwise the popular culture passes into the pockets of the plutocrats.

    Now we turn to the question of downloads. The old 20th-century business model of a physical copy of a copyright article having an intrinsic worth for which a fixed price should be paid is outmoded and must be discarded, simply because we are now in an age of infinite reproduction with high fidelity to the original, and obeying the classical rules of mass production, the cost of reproduction must fall down as far as manufacturing processes will allow, and in the case of anything transmitted over the Internet, as we have seen, much of the cost is borne by the consumer rather than the vendor. What we are left with is essentially a residual cost, which is notionally the financial equivalent of the “rights” of the seller. And for large numbers of the product to ship successfully, history suggests that this residual has to be as small as possible.

    This is the situation with which publishers are faced nowadays: each new technical innovation has always resulted in undercutting the competition rather than increasing profits directly from the sales of individual products, because more profits are won from shipping the product in bulk rather than as single items; just ask the old Mediaeval publishers, for whom each document was hand-written on parchment or expensive hand-made paper – they could not survive after the invention of movable type, except by adopting the same technology themselves. Was the result detrimental? Short answer: NO – instead, we now have extensive records which were easier to reproduce. If the Mediaeval publishers had killed movable type, there would be no mass communication today, because although the form has changed somewhat, the content remains communicable, and that in itself is priceless. But it was innovation which brought us these dubious joys, not staying in the days of hand-written parchments. And there is the real lesson of history.

    (Writer’s note: This was such a good session, I will put this up on my blogs, too! ^_^)

    fukudasan

  • http://www.techdirt.com/ Mike Masnick

    Tim,

    Why must it include intellectual property rights? And why the focus on policy change? If the business models change, than policy change becomes much less needed.

    And, the example of the candy bar isn’t a decent analogy for one very simple reason. When that candy bar is stolen, it’s not available for anyone else. In the case of digital files, nothing is stolen — only copied. And, it’s the copy that costs virtually nothing. And, as you well know, basic economics tells us that over time, in a competitive markret, price gets driven to marginal cost. Marginal cost = 0? Guess what, price gets driven there too.

    That’s not the case with the candy bar, but it’s absolutely the case with digital files.

    It’s a case of the market becoming much more efficient — which is a good result. If the business models recognize and embrace that, then the policy wonks won’t need to do very much at all, other than get out of the way.

  • http://www.techdirt.com/ Mike Masnick

    Tim,

    Why must it include intellectual property rights? And why the focus on policy change? If the business models change, than policy change becomes much less needed.

    And, the example of the candy bar isn’t a decent analogy for one very simple reason. When that candy bar is stolen, it’s not available for anyone else. In the case of digital files, nothing is stolen — only copied. And, it’s the copy that costs virtually nothing. And, as you well know, basic economics tells us that over time, in a competitive markret, price gets driven to marginal cost. Marginal cost = 0? Guess what, price gets driven there too.

    That’s not the case with the candy bar, but it’s absolutely the case with digital files.

    It’s a case of the market becoming much more efficient — which is a good result. If the business models recognize and embrace that, then the policy wonks won’t need to do very much at all, other than get out of the way.

  • http://www.binarybits.org/ Tim

    I’m not saying a solution has to include intellectual property rights. But right now, intellectual property rights are the law of the land, and if we’re going to abandon them, that should be done by changing the law, not by encouraging people to break it.

    Moreover, while the marginal cost of producing a copy of a song is zero, the marginal cost of producing the song in the first place is definitely non-zero. So to persuade most people that abolishing IP is a good idea, you’ll have to convince them that there would still be sufficient incentive to continue creating music.

    Now, I recognize that there are some good arguments to that effect, and I don’t really want to re-hash them here. But I guess my point was that if EFF’s position is that we don’t need copyright at all, they seem to be doing their best not to talk about it.

  • http://www.binarybits.org/ Tim

    I’m not saying a solution has to include intellectual property rights. But right now, intellectual property rights are the law of the land, and if we’re going to abandon them, that should be done by changing the law, not by encouraging people to break it.

    Moreover, while the marginal cost of producing a copy of a song is zero, the marginal cost of producing the song in the first place is definitely non-zero. So to persuade most people that abolishing IP is a good idea, you’ll have to convince them that there would still be sufficient incentive to continue creating music.

    Now, I recognize that there are some good arguments to that effect, and I don’t really want to re-hash them here. But I guess my point was that if EFF’s position is that we don’t need copyright at all, they seem to be doing their best not to talk about it.

  • http://www.techdirt.com/ Mike Masnick

    Okay. I’ll let this drop, but, nowhere do I encourage people to break the law. I’m saying that it’s the producers of the music who should specifically point out that they want the music shared, because they know they can make up the money elsewhere. That’s not breaking the law, that’s their choice to free the “intellectual property” that they own.

    And, as more musicians become successful doing this, as outlined above, then I won’t have to convince anyone. The success stories will make it clear to everyone…

    Once that’s the case, the policy decisions concerning such things as intellectual property become quite obvious.

  • http://www.techdirt.com/ Mike Masnick

    Okay. I’ll let this drop, but, nowhere do I encourage people to break the law. I’m saying that it’s the producers of the music who should specifically point out that they want the music shared, because they know they can make up the money elsewhere. That’s not breaking the law, that’s their choice to free the “intellectual property” that they own.

    And, as more musicians become successful doing this, as outlined above, then I won’t have to convince anyone. The success stories will make it clear to everyone…

    Once that’s the case, the policy decisions concerning such things as intellectual property become quite obvious.

  • http://www.binarybits.org/ Tim

    The reason that the price of music is dropping toward zero is precisely because the law is being broken.

    Certainly, I would encourage artists and publishers to explore alternative business models. If they can find a way to give away their music and make a profit on advertising or concerts or whatever, more power to them.

    But in the meantime, copyright is the law of the land, and the labels have every right to insist that their rights be enforce, through the court system if necessary.

  • http://www.binarybits.org/ Tim

    The reason that the price of music is dropping toward zero is precisely because the law is being broken.

    Certainly, I would encourage artists and publishers to explore alternative business models. If they can find a way to give away their music and make a profit on advertising or concerts or whatever, more power to them.

    But in the meantime, copyright is the law of the land, and the labels have every right to insist that their rights be enforce, through the court system if necessary.

  • http://www.techdirt.com/ Mike Masnick

    I think we’re talking at different points. I’m not encouraging anyone to break the law. I’ve never downloaded a song in my life. I believe that it is against the law.

    What I’m saying, though, is that people are doing it anyway, and that should be a clear indication to record labels of what people are thinking. In the case of the candy bar, it’s not a situation where you have millions of people stealing candybars. But, millions upon millions of people are making copies of music — and they don’t believe it’s morally wrong because they know that there’s no “loss” going on.

    So, no, I’m not saying anyone should break the law. I’m saying that record labels need to recognize what the market is telling them and embrace it.

    Not sure why you keep insisting that I’m telling people to break the law.

  • http://www.techdirt.com/ Mike Masnick

    I think we’re talking at different points. I’m not encouraging anyone to break the law. I’ve never downloaded a song in my life. I believe that it is against the law.

    What I’m saying, though, is that people are doing it anyway, and that should be a clear indication to record labels of what people are thinking. In the case of the candy bar, it’s not a situation where you have millions of people stealing candybars. But, millions upon millions of people are making copies of music — and they don’t believe it’s morally wrong because they know that there’s no “loss” going on.

    So, no, I’m not saying anyone should break the law. I’m saying that record labels need to recognize what the market is telling them and embrace it.

    Not sure why you keep insisting that I’m telling people to break the law.

  • http://interbutt.com/ Justin Kerk

    In my opinion, if you can’t even support the lawsuits against individual users, then you essentially don’t believe in ANY sort of copyright enforcement.

    I disagree. I think a lot of people are of the opinion that copyright enforcement should exist, but be restricted to its original function as “a legal regime designed to go after commercial pirates”, as you put it, and not affect non-commercial copying by individuals at all. A great many Internet users support the use of peer-to-peer file-sharing networks (as evidenced by their usage numbers), yet profiting from copies of someone’s work without their permission is nearly universally denounced online (such cases occur not infrequently in communities that distribute their creative work for free online).

    Such a system would certainly be much weaker than the current system of copyright enforcement but I don’t think you can argue that it’s the same as zero copyright enforcement (by that reasoning, Canada now has almost no copyright enforcement for audio recordings).

    And of course if this is indeed EFF’s position I agree that they need to come out and say so.

  • http://interbutt.com/ Justin Kerk

    In my opinion, if you can’t even support the lawsuits against individual users, then you essentially don’t believe in ANY sort of copyright enforcement.

    I disagree. I think a lot of people are of the opinion that copyright enforcement should exist, but be restricted to its original function as “a legal regime designed to go after commercial pirates”, as you put it, and not affect non-commercial copying by individuals at all. A great many Internet users support the use of peer-to-peer file-sharing networks (as evidenced by their usage numbers), yet profiting from copies of someone’s work without their permission is nearly universally denounced online (such cases occur not infrequently in communities that distribute their creative work for free online).

    Such a system would certainly be much weaker than the current system of copyright enforcement but I don’t think you can argue that it’s the same as zero copyright enforcement (by that reasoning, Canada now has almost no copyright enforcement for audio recordings).

    And of course if this is indeed EFF’s position I agree that they need to come out and say so.

  • http://www.binarybits.org/ Tim

    Justin,

    If Congress legalized peer-to-peer file-sharing of copyrighted material, wouldn’t that amount to the de facto repeal of copyright law, at least as far as music goes? After all, within a few years virtually everyone will have a computer and an MP3 player. At that point, why would anyone pay for a copy of music they can get online for free?

  • http://www.binarybits.org/ Tim

    Justin,

    If Congress legalized peer-to-peer file-sharing of copyrighted material, wouldn’t that amount to the de facto repeal of copyright law, at least as far as music goes? After all, within a few years virtually everyone will have a computer and an MP3 player. At that point, why would anyone pay for a copy of music they can get online for free?

  • http://interbutt.com/ Justin Kerk

    The retail market would probably be doomed, but that’s not the entire music industry, and I think copyright could still have a role to play. Musicians make a sizable proportion of their income from live performances. Copyright law would still be relevant there, for example in preventing bands from plagiarizing lyrics or melodies written by others. Radio stations and TV channels like MTV would still have to pay musicians to broadcast recordings of their music.

    Musicians might not make as much money as they did before, but I don’t think society owes them any guarantee of continuing to make as much money as they did before, seeing as technology has greatly reduced the scarcity of their product. At worst, they’ll be back to where they were a century or so ago when recording technology didn’t exist. We had musicians then, and we’ll continue to have them in the future, but maybe not on the same scale as in the twentieth century.

  • http://interbutt.com/ Justin Kerk

    The retail market would probably be doomed, but that’s not the entire music industry, and I think copyright could still have a role to play. Musicians make a sizable proportion of their income from live performances. Copyright law would still be relevant there, for example in preventing bands from plagiarizing lyrics or melodies written by others. Radio stations and TV channels like MTV would still have to pay musicians to broadcast recordings of their music.

    Musicians might not make as much money as they did before, but I don’t think society owes them any guarantee of continuing to make as much money as they did before, seeing as technology has greatly reduced the scarcity of their product. At worst, they’ll be back to where they were a century or so ago when recording technology didn’t exist. We had musicians then, and we’ll continue to have them in the future, but maybe not on the same scale as in the twentieth century.

  • http://tieguy.org/blog/ Luis Villa

    Tim, to add another recommendation to the pile, you might pick up Jessica Litman’s ‘Digital Copyright’, which I think has some pretty good points on the disconnect between what fair use is to lawyers and copyright cognoscenti (four-fold test, etc.) and what fair use is to everyone else on earth (‘am I profiting from it? am I sharing with people I know?’), backed by some fairly in-depth analysis of the history that got us to that dichotomy between what people think the law is/should be and what it really is.

    While I think you’re right that moving to that definition of fair use (or something like it) would have a fair amount of impact on the music industry, it isn’t clear that the impact would be as devastating as you’d like to claim, particularly for artists who don’t suck live. And even the non-artist parts of the industry (which I think you give altogether too much value to) would likely survive in some form- as the movie industry is finding out, there is a lot of value in ancillary bits that aren’t the core of the good. As the Grateful Dead, Phish, and others have been proving forever, you can make a ton of money off touring, t-shirts, all kinds of stuff, if you’re actually good live- lots more than you can make in the studio, and completely without the benefit of copyright protection even on the live performances.

  • http://tieguy.org/blog/ Luis Villa

    Tim, to add another recommendation to the pile, you might pick up Jessica Litman’s ‘Digital Copyright’, which I think has some pretty good points on the disconnect between what fair use is to lawyers and copyright cognoscenti (four-fold test, etc.) and what fair use is to everyone else on earth (‘am I profiting from it? am I sharing with people I know?’), backed by some fairly in-depth analysis of the history that got us to that dichotomy between what people think the law is/should be and what it really is.

    While I think you’re right that moving to that definition of fair use (or something like it) would have a fair amount of impact on the music industry, it isn’t clear that the impact would be as devastating as you’d like to claim, particularly for artists who don’t suck live. And even the non-artist parts of the industry (which I think you give altogether too much value to) would likely survive in some form- as the movie industry is finding out, there is a lot of value in ancillary bits that aren’t the core of the good. As the Grateful Dead, Phish, and others have been proving forever, you can make a ton of money off touring, t-shirts, all kinds of stuff, if you’re actually good live- lots more than you can make in the studio, and completely without the benefit of copyright protection even on the live performances.

  • Anonymous

    The solution is easy: have courts start protecting peoples civil rights which are continually being violated by large corporations with impunity. If they continue assaulting people with lawsuits claiming exorbitant and deeply immoral ($150,000 per violation) damages, soon those values will be changed to something more realistic, like say $10.00 per song.

    If the normal democratic processes to changing these fines are blocked by large corporations, I fully expect we will see someone commit an act of terrorism against Sony or some other large corporate pig. This would be truly unfortunate, but entirely predictable example of how humans can be expected to react to being mistreated.

    The behavior of these corporations could feed domestic anti-corporate terrorism, which will be a truly unfortunate, but avoidable occurrance.

    These corporations will really only have themselves to blame: they have enacted a criminal, repressive protection racket, and eventually people will respond with violence.

  • Anonymous

    The solution is easy: have courts start protecting peoples civil rights which are continually being violated by large corporations with impunity. If they continue assaulting people with lawsuits claiming exorbitant and deeply immoral ($150,000 per violation) damages, soon those values will be changed to something more realistic, like say $10.00 per song.

    If the normal democratic processes to changing these fines are blocked by large corporations, I fully expect we will see someone commit an act of terrorism against Sony or some other large corporate pig. This would be truly unfortunate, but entirely predictable example of how humans can be expected to react to being mistreated.

    The behavior of these corporations could feed domestic anti-corporate terrorism, which will be a truly unfortunate, but avoidable occurrance.

    These corporations will really only have themselves to blame: they have enacted a criminal, repressive protection racket, and eventually people will respond with violence.

  • http://www.josephlied.com/ idiot

    i am an idiot and i am lead by richard simmons

  • http://www.josephlied.com/ idiot

    i am an idiot and i am lead by richard simmons

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