Copyrights And Wrongs

June 13, 2012 Ivan Teh - RunningMan 0 Comments

Copyrights And Wrongs

General Principles Of Copyright:
Definition: Copyright is a legislative monopoly over the the making and distribution of reproductions of the material expression of an original creation.

Copyright applies to the material expression of ideas, not the ideas themselves.

Copyright subsists for a limited period of time, usually until the death of the author plus x years. 

That time depends upon the specific legislation applied in each country (example, in the US copyright subsists from the death of the author plus 70 years – used to be plus 50, but Disney lobbied successfully for further extension).

Copyright can be assigned in whole or in part, in definite geographical territories and / or specific period of time.

Copyright is not a property right; it is a limited, temporary monopoly over the creation of copies.

The underlying goal of copyright legislation is to give an incentive to create.

It is not a right, in the sense of ‘human rights’, or ‘the right to free speech’; it is an incentive to create.

It does not give the copyright holder ownership or control over copies created (cf right of first sale, fair use rights).

Why Have Copyright?
Copyright is designed to create a balance between private and public goods. 

The private good is that of the copyright owner – copyright allows them to profit from their creative work, and thus gives them an incentive to create.

Society as a whole benefits when new ideas, new works, new creations are brought into the public arena – it leads to social, cultural and economic development.

So the private good provided for by copyright (the monopoly over reproduction) is ultimately aimed at the creation of a public good (social/cultural/economic development).

Limits are imposed on the period of copyright, so that all works will eventually fall into the public domain – the common property of the public.

Thus copyright is not in fact a private ‘right’, but an incentive granted to private individuals to create because such creations, and the discussion and dissemination of them is (on the whole) good for democratic society.

Copyright grants a legislative monopoly over the reproduction of the material expression of an idea.

The Problem With Copyright:
1. Monopolies are inherently anti-competitive.
2. Ideas are not subject to natural scarcity.

Monopolies enable monopoly holders to avoid the discipline of the marketplace (scarcity, supply & demand, competitive improvement).

Physical commodities (cars, gold, etc.) are subject to scarcity – there is only a limited supply of them.

Price is (theoretically) determined by supply and demand in a capitalist system.

If there is less of something than there are people to buy it, the price goes up, and vice versa.

Competitive improvement: if you come up with a better product than me, people will buy yours over mine.

Which forces me to improve my product, to the benefit of the buyer.
A monopoly has no competition (no impetus to improve), and can set supply artificially, and thus inflate prices.

So copyright monopolies diminish competition, and inflate price (this is why out of copyright books – i.e., Shakespeare – tend to be much cheaper than new books).

Ideas are not physical property, and thus not subject to natural scarcity.

Idea are just information, not commodities;
Thomas Jefferson: “The peculiar character [of an idea] is that no one possess the less, because every other possess the whole of it. He who receives an idea from me, receives instruction without lessening mine; as he who lights his taper at mine, receives light without darkening me.”

Of course, copyright doesn’t protect ideas, only their physical expression (the actual paperback, not the idea behind it).

That is, it relies on the fact that media objects are physical things in order to treat them as commodities.

This becomes very important when we look at why digital media creates serious challenges for the operation of copyright.

NCT's deal purely with digital information, with ones and zeros, bits and bytes.

Digital communication is intangible, not physical (what you see on your computer screen is just a visual representation of that intangible information).

So, in principle, nothing in digital form – no digital media object – is subject to scarcity or the operation of  supply and demand.

In effect, it has the same qualities as those Jefferson attributes to ideas – I can give it to you, and still keep it myself (unlike a car).

So, in principle, nothing in digital form – no digital media object – is subject to scarcity or the operation of  supply and demand.

Why NCTs Threaten Copyright:

1. Digital media is just information, not a physical object like a VHS tape.

2. Digital media objects can be reproduced infinitely without loss of quality.

3. Digital media objects can be distributed on a mass scale for little or no cost, and at virtually infinite speed.

Copyright ‘piracy’ has always taken place, but in an analogue world it has natural physical limits to its scale.

1. Each time you copy an analogue media object, it degrades in quality.

2. Producing large quantities of pirate material requires substantial physical equipment – a factory of sorts.

3. Distributing large quantities analogue media objects is both costly, slow, obvious, and requires lots of workers to do it.

So pirated analogue media objects tend to be of poor quality, and its much easier for authorities to locate and shut down pirate operations.

Digital media objects on the other hand can be reproduced infinitely without loss, require very little to mass reproduced them other than a computer, and can be distributed very easily en-masse via the internet – all by a single individual.

Furthermore, p2p distribution systems have no central point which can be shut down / sued in order to bring piracy to a halt.

Thus rather than one person trying to distribute 1000 copies of a tape, you may get 1000 people distributing individual copies of 1000 different songs.

Even if you could sue every single p2p file sharer (which you can’t, in any practical sense), you would never extract the cost of even one of the cases from them, since on the whole they tend not to have large amounts of money to be taken off them.

So where, for analogue media, there was a natural limit to the scale of copyright theft, with digital media there is a natural, practical limit to the scale of copyright enforcement.

Ideas VS Commodities:
Digital media objects are just information, not commodities like cars or gold.

If I give you my car, I don’t have it any more, but if I share my music collection with you, then we both have it.

So the problem here isn’t just mp3 files – it’s all digital media. All forms of NCT face versions of the same problem.

So all of the media industry is confronted with the problem of how to protect their copyrighted material.

Appeals to ‘the starving artists’ are largely ineffective, since the general population knows that most of the money doesn’t go to the artists in the first place. 

i.e., Music industry 90-05%, musicians 5-10% (if they’re lucky).

And of course, p2p has plenty of other advantages over legal distribution besides being free.

Access to wider selection (not just what the local chain store has – i.e, supports niche interests/communities).

Choose what you want (i.e. only the track/s you want, not the whole album).

Faster and easier (don’t need to leave your computer).

So file sharing, although it’s illegal, is very attractive to the user.

Tools like bittorrent make it easy to download large files, like video, so nothing is safe.

So the media industries have a big headache on their hands.

Digital Rights Management (DRM):
DRM basically refers to systems and technologies of copy protection – anything that stops or limits the user either from making copies, distributing copies or from making use of copied files.

So the ‘Zone’ system on DVDs is a form of DRM.

As is the way my iPod won’t let me download my music files from it to anyone else’s computer.

As is any kind of encryption/decryption system.

The basic idea here is to stop you (the user) from having any kind of access to their copyrighted material, other than watching/listening in the way they intend (i.e., passively).

There are two problems with this approach.

1. It prevents you from using the song etc. you’ve bought in ways that are quite legitimate (fair use – this differs from country to country, but things like taping off TV, making compilation tapes or backups of music you’ve bought, etc.)

2. It doesn’t work. - Why?

A) Because people want to do things like make compilation tapes, see it as fair and reasonable, and get cranky if they can’t.

B) If they feel they’re being unfairly restricted, they’re unlikely to have moral problems breaking copy restriction.

C) It only takes single person to work out how to break your copy protection and publish it on the net to make it useless.

D) There are many more people out there on the net working alone/together to break your encryption than you could ever employ to  come up with it in the first place (collective intelligence).

So most copy protection devices get cracked in a matter of hours or days (rarely months), no matter how good they are.

So copy protection annoys your customers, makes them more likely to be willing to break the law, and doesn’t work anyway.

Digital Millennium Copyright Act (DMCA):
It basically makes it illegal for anyone to even talk about, let alone publish, information that makes it possible to break copy protection or security on any piece of software or hardware.

This has some very ugly consequences.

DMCA is not an extension of copyright in any way.

In fact it fundamentally distorts the principle of copyright as a balancing of private and public good.

It gives producers a whole new set of rights that enable them to treat copyright as if it were a property right.

That is, they can place any kind of limitation on your fair use rights arbitrarily and unrestrainedly, and take away your copyright rights.
And not only are you not allowed to do anything about it, you can’t even talk about it.

So they can decide how you should use their DVD (for example), where you should use it, and what you can play it on – even how many times you can use it.

This is a bit like me selling you a car, and then telling you that you can only drive at 30kph on Sundays in May, and only to go to and from Church.

What’s more, even though it’s a US law (though they are using bilateral free trade agreements to pressure other countries to adopt it), if you break it anywhere in the world, and then go to the US, they can arrest you.

And it stops you from talking, even if you have legitimate reasons for doing so.

So DMCA returns copyright to its historical beginnings as a form of censorship.

And turns copyright into a property right – it attempts to commodify  information.

You no longer own the music you buy, you just get permission to use it how, when, and where the music industry tells you to.

It’s another attempt to recentralise what is now a decentralised system – to bring it back under the control of the ‘one’, and out of the hands of the ‘many’.

Ideas don’t work the same way as car, or gold, or other material goods?

Not subject to scarcity, operates as an asymmetrical exchange, etc.

Well DMCA tries to make ideas like cars, allowing the formation of artificial monopolies/oligopolies that can impose artificial scarcity on their product and manipulate market prices, and remain exempt from the pressure to improve exerted by real competition – all of which is bad for capitalism.

i.e, if you can only listen to your song on Windows Media Player, you’re trapped as a Microsoft customer as long as you want to listen to the music that you have paid for.

SOPA – Stop Online Piracy Act:
An even more invasive, onerous, restrictive and controversial piece of legislation that is on the table in the US.

Its opponents claim it will destroy ecommerce, make the net less secure, and have little impact on piracy.

In January 2012, Wikipedia ‘blacked’ itself out for a day as a protest against SOPA.

Whether it could work, and how damaging its effects would be is unknown.

It may never get of the ground.

But the fear of the effects of NCTs on mainstream/mass media businessm models reflects an unwillingness to consider what the benefits of NCTs could be.

Copyright is response to technological change (the printing press). 

We could just change how it works in response to our new technology.
But that probably won’t happen.

But businesses working in this environment that change their approach can benefit, not suffer from NCTs.

Example: Apple music store a direct response to Napster.
tries to provide the benefits of p2p sharing legally for a fee that people think is fair.

It seems to work, even though anything you could buy from Apple could be got for free from a p2p network.

People don’t mind paying (especially if the money goes to the author/artist, not the ‘big boy’ company that distributes them), if they think they get value and choice for their money.

Some have suggested that the future for the media industry is in more openness and interoperability, not less.

That this will stimulate new products, new markets, and higher consumption (good capitalism!), not less.

The price might be dropping current notions of copyright, and many of the existing media business models.


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