Tag copyright

Entries 16 Total

Giving and taking back

Apr 15, 11 1:51 PM

It’s a bit late to say much of interest about AOL’s acquisition of Huffington Post (other than to wonder whether they ever had any senses to take leave of) but the news that Jonathan Tasini is suing HuffPo is worthy of comment.

Tasini has form when it comes to lawsuits. His name is on one of the most famous, tedious and pointless copyright cases of recent years. In that case he was arguing, basically, that journalists should be paid again when the publications which commissioned them made the content available through databases.

Based on that case, you would expect that Tasini is the kind of writer who is strictly coin-operated. He doesn’t seem like the kind of guy who’ll let any publisher use his words without paying him for his efforts.

Yet, it seems, he was a willing, despite being unpaid, contributor to Huffington Post. Like many others he chose the nebulous and intangible reward of exposure through her site in preference to money. In his case it was to publicise his senate election campaign.

Now, though, he says he deserves some of the absurd sum she received for her site, because although he knew he wouldn’t be paid and didn’t ask to be paid, he thought maybe he would be one day anyway. So the money she has made in the transaction is “unjust enrichment” and he and his fellow bloggers deserve a third of it. $105m.

Now, in my view the amount paid for Huffington Post was unjustified by any sane assessment of value, but it wasn’t unfair on anybody (except, perhaps, AOL shareholders). She has done extraordinarily well to have pulled off such a deal, the fact that she managed to persuade so many people to work for her for free is testament to some kind of skill she must have.

Truth is that contributors to HuffPo knew the deal. Their contributions weren’t done in exchange for shares any more than money. A deal’s a deal, and whinging about it afterwards when you realise you got the raw end of it seems pointless to me. (Who is that guy who sold his Apple shares to Jobs back in the day? He got some trifling sum for them, would be worth billions today. Haven’t noticed him whinging).

And where copyright is concerned, I think that as long as the deal is clear, and you agree to it, then it’s fair and square. That idea, in fact, formed the basis of Tasini’s previous lawsuit, where because publishers hadn’t explicitly obtained rights to use content in databases, contributors demanded to be paid again. Notably, Tasini’s case this time doesn’t mention copyright.

There’s plenty of use of content on the internet which is both unrewarded and infringing – that would seem like a better target for lawsuits.

In the meantime, there’s a lesson here. If you give someone something valuable without asking for anything in return, don’t be surprised if they end up better off than you.

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Perfect economies

Apr 6, 11 7:42 AM

Is free really a radical price or just radically irrational?

Some say content will become free as a matter of economic necessity. That as the cost of copies of content approaches zero, so will its price. That we are in the grip of an all-powerful economic principle which will sweep whole industries before it, and the fact that so much content is given away online proves their point.

I say that the cost of content, in pure economic terms, has always been zero. That the “pure” economics of physical goods, applied to intangible products like content, led to terrible outcomes the last time it was tried, leading to a change in the law to prevent it happening again. And that this law, now being widely ignored, is the answer both to the “content wants to be free” pseudo-academics and also the problem the content industry now faces.

Cost=value?

I am not an economist. I am not an academic. I didn’t study much of anything. So forgive me if I tempt fate by taking a mighty leap to address a – seemingly academic – point which has become trendy among certain prophets of the digital age who, presumably, hope their wisdom will become self-fulfilling.

The academic point in question concerns the price for which content is sold online. More specifically, the point made by many that the rules of the internet radically change the economics of publishing, such that the aspiration to charge users for content is hopelessly unrealistic. Only dinosaurs think that way, we’re told: people who understand the internet also understand that giving things away is the key to reaching a lot of people, and reaching a lot of people is the key to making money.

So free, to quote the cover of Chris Anderson’s counter-intuitive but attention grabbing book “Free”, is “a radical price” which will define the future.

(An aside: I tried to get a copy of Free for, er free. It was available as a digital download for nothing at the time it was published. However now it’s not available free. The “hardcover” edition is available as a Kindle download for £12.15. The “paperback” edition – with a new, less embarrassing, strapline – is available for £5.45 in print but not at all on Kindle. So much for the radical economics of the internet).

Anyway, the argument goes something like this: making copies of digital things doesn’t cost anything. Economists tell us that in a perfect economy the price of something will tend towards its cost of production. For something which costs nothing to produce, like a digital copy, the price will tend towards zero. The fact that so much content is available for free is proof that the market is working well and the internet is fulfilling its potential. (Expand this argument to 400 pages and sell it and you too can be an internet guru as well as a rich author).

The sub-argument is that having so many consumers of your stuff gives you the chance to sell them other things, like concert tickets instead of CDs, or slightly better things, like CDs instead of downloads for your hardcore fans (or, like Chris Anderson, hardcover books, speaking engagements, consultancy and a day job editing an old media magazine as well as temporarily free downloads). So you can make money that way, in a way the content is a loss-leader for whatever else it is you have to sell. This is known as “Freemium” – you reward the people who care little for your stuff by giving them what they want for nothing, and punish those who really love it by charging them for consuming a lot of it.

Circular thinking

I think these arguments are a perfect illustration of what is wrong with internet thinking. So much of it is a post-rationalisation. It starts with a utopian picture of the internet the way the thinker would like it to be, idealised so that everything they care about is plentiful and – with the exception of whatever it is which makes them money – free. It progresses into the real world, via people and businesses simply behaving as if their utopian ideal were a reality (this is called, proudly, “a disruptive business model”), unencumbered by any old-world rules. It finishes with a seductive, intellectually feeble, post-rationalisation of the outcome whose main purpose is to justify itself and perpetuate the insular interests of those who profit most from the changes. An honest consideration of the broader picture almost never features and the interests of users and society as a whole, almost always claimed as the ultimate justification for whatever is being argued, are virtually never really considered.

So, back the economic argument for content being free (or, in some cases, for copyright no longer being relevant). The central point is that the cost of a digital copy is zero.

Cost has always been zero

My counterpoint is that the cost of copies of content has always been zero. When books first started being mass produced, the cost of the content, as opposed to the paper, ink, binding, distribution and so on, was always nothing. You used the same amount of ink however you arranged it on the paper. The words themselves made no difference to the cost. A CD costs the same (about 9p) to manufacture whether it contains a Lily Allen album or Microsoft Office but might be sold for anything from a few pounds to a few thousand pounds depending on what it contains.

It’s the content which creates the value. The bits, not the atoms, are the product whatever it looks like on the shelf of a shop.

So in my view, it’s pointless to consider the economics of content in terms of the manufacturing cost of copies because doing so not only defies everything we know about the content economy but also leads to perverse outcomes.

Weve been here before…

There was a time when the “natural” economics were the only kind around. The world was about supply and demand, the materials which went into something more or less defined the whole. You could add up all the costs of something, add on whatever margin you thought you could get away with, and sell your product.

The thing which changed it was books. The advent of the printing press revolutionised the way in which knowledge could be shared and spread. For the first time mass production could make books affordable to the masses. Great things would happen.

However, the economic realities lagged behind the industrial surge forward. Although printing was indeed cheaper and easier than ever before, the main value of a book was the words on its pages rather than the pages themselves.

Bits and atoms 300 years ago

Unfortunately the laws of supply and demand didn’t recognise this. They only dealt in atoms, not bits. So the people who wrote the books, who created most of the value, tended to get a bit of a raw deal – however successful their book might be they rarely made much money. So not many books got written. The authors usually had better and more lucrative things to be doing.

So a law was written, the now infamous Statute of Anne, the first modern copyright law. Its aim was to ensure authors were properly rewarded for their work, to end the “ruination” of them and their families which too often had happened in the past. And it did this in a simple way – by giving them control over copies of their work. By recognising that the bits had a value beyond the atoms of the paper and ink, and putting in place a solution which would allow the value to be determined by the market.

And so, a book or CD which costs a few pence to produce is sold for a few pounds. JK Rowling is a billionaire. Hundreds of thousands of books are published every year, hundreds of TV channels flourish and thrive, countless movies are made every year and the creative economy supports 8% of the overall UK economy and over 2 million jobs. Even the printers, publishers and distributors of books, who would have seem to have got the raw end of the Statute of Anne, are still doing fine. Taking a smaller, fairer, slice of a much bigger pie, and thriving nonetheless.

All be recognising that the words, or the bits, have value separate from the paper they’re printed on, or the atoms.

Forward to the past

Fast-forward to the internet. Here we find ourselves in a situation a bit like the pre-copyright era. For a number of reasons, most of which are for another day, mass market publishing is only possible online for no charge. The only direct revenues available to publishers are from advertising, but they are competing for a smaller slice of an ever-diminishing advertising pie (I’ll come back to this point in another post as well). Success is about scale, quantity trumps quality.

So the people making money are those who pay the least for their content. The most money is made by the people who pay nothing (Google, overwhelmingly). The people who pay nothing, who benefit the most from content being free, are also the strongest advocates of content being free as a force of nature or of economic reality. They ignore, because it doesn’t matter to them, the actual reality that if the returns on the investment of time, money and creativity diminish so will the investment.

Free isnt worth the paper it isnt written on

To me the “free” idea is as worthless as it suggests. To my mind it’s simply wrong, and it destroys value for almost everyone except the person sitting at the tip of the pyramid.

Anyone who wants to be able to make a living from their creativity should be able to choose to do so, and choose their way of doing so, without the odds being so heavily stacked against them. I hope this is about to become a bit easier.

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How do we know copyright is working?

Mar 29, 11 5:03 PM

I have spent a working lifetime sitting on one side of the copyright debate – broadly the “copyright is good” side. I have also, latterly, spent a lot of time listening to people telling me why Im wrong, why I am a dinosaur who cant let go of the past.

Obviously I have spent my career being driven by vested interests – I have worked for companies which are strongly dependent on copyright. So when I have been defending copyright I have also been defending their interests and my own job.

Equally obviously, many if not most of the people on the other side of the debate have vested interests of their own. Search engines and aggregators, academics, thinkers and would-be futurists – even newspaper editors, sometimes – have their own reasons for predicting or relishing the imminent demise of the copyright-based business model.

But what if we step back from both sides of the various vested interests and try to think about what we want, as a society, from copyright. Ignoring the commercial interests, what as an ordinary person can be regarded as a good thing? Perhaps then well have a new perspective from which to consider the polarised opinions being so freely touted.

I had a go at this for a talk I did towards the end of last year. I came up with a list of about fifteen signs that copyright is working well which I managed to distill down to three pithy ones: diversity, investment and reward.

Diversity. A diverse and growing ecosystem of content and creators, leading to a large and increasing choice for consumers, greater access to knowledge and effective and increasing competition for audiences.

Investment. A growing investment of time and money in creating content, products and innovative new ideas which effectively address the needs of the market. Risk-taking by investors and creators, new players entering the market, and a diversification of business models.

Thirdly, and perhaps most all encompassingly, the best and most popular content to be recognised and rewarded. The possibility for big winners to emerge, adaptable, clever companies and creators winning out over slower, less nimble players and not just by appropriating their raw materials from elsewhere.

The reason I think these three things particularly matter is because of the most important outcome of all: access to knowledge and creativity.

Its a good thing if people in general have wide access to the maximum amount of other peoples output and intellect – as well being educational it is the engine of culture and of inspiration and that is the central purpose for which copyright was devised. We are entertained, informed and enriched by other peoples creativity and ensuring that continues has traditionally been the central public good which copyright law seeks to promote.

So: I think a key sign of copyright working well is that lots of people are producing lots of output, and the most popular are the most successful (in whatever terms they judge success – which may or may not be financial).

Am I right about desirable outcomes? If I am, then it provides an interesting backdrop to the debate about if and how copyright needs to change in the internet era. If not, what should they be?

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Obstacles, obstacles

Mar 24, 11 12:29 PM

The UK government is reviewing Intellectual Property at the moment. Ian Hargreaves, an academic and former newspaper editor, has been given the task of following in the footsteps of numerous recent reviews and consultations to yet again try to come up with a prescription of how to fix copyright.

This task, as Prof Hargreaves probably realises by now, is a bit of a nightmare. It pre-supposes that something is broken, that its the governments role to fix it, and that the past ways of doing things are to blame. David Cameron didnt make it any easier when, in his out-of-the-blue announcement of the review, he said that he had been prompted to instigate it by Googles founders, who have told him that they couldnt have started their business in the UK and that our IP laws (specifically the absence in them of the american principle of “Fair Use”) were to blame.

I suppose it must be tempting for a Prime Minister to imagine that a small tweak in an obscure area of law might prompt a flood of multi-billion pound businesses to spring up around the “Silicon Roundabout” but its also absurd and unimaginable (even if you ignore the hardly irrelevant observation that Google do about £2bn of business in the UK, seemingly without any fatal impediments from IP law).

So Prof Hargreaves has to go back with something for Cameron. After going to all the trouble of doing a review, at breakneck speed, a report saying “do nothing” probably isnt an acceptable outcome.

But it may be one of the least worst options. What the Prime Minister is focussed on, it seems, is helping SMEs and promoting entrepeneurialism. IP, he is told, is a barrier to people launching businesses and doing clever, Googleish, things.

What doesnt seem to have been considered, at least before the review got going, is that IP law is by far a greater begetter of innovation and entrepeneurialism than it is an inhibitor of it.

Of course, IP law allows a rightsowner to decline to licence their content. If a startup depends for its success on obtaining rights to other peoples content then it definitely has a problem should the licence turn out to be hard to get. But if that happens its a mighty leap to blame IP law, and a complete misunderstanding of what copyright means.

Copyright is the right to say no, to keep your content private if you want. In reality its effect is to encourage people to distribute their stuff as widely as possible – a goal which is achieves with spectacular success. So if copyright owners decline to licence their content to someone theres probably a reasonable explanation (although unreasonable ones are just as valid).

In my experience licensing content for a big media organisation, the most common reason why we declined licences was because the terms being offered are unrealistic, often wildly so. Is has become almost axiomatic on the internet that content is free, and so content-dependent businesses can only succeed if their costs are low or zero. So many startups choose to source theirs from elsewhere because its cheaper than creating their own and are often genuinely amazed when their (frequently risible) offer is declined.

In other words IP licensing can very well be a barrier to SMEs, in the same way as lack of wealth or availability can be a barrier to me living in the nicest mansion I can find. But that doesnt mean the law is either to blame nor that the law needs to change to advantage one party (the one not making the investment in content) over the other (the one which does).

That this review was sparked by Google is almost comical, since they have made one of the biggest businesses in the world out of treating other peoples content as a free resource. It would seem to me that they should be careful what they wish for because the status quo could barely be more skewed in their favour.

Hopefully the review will reach some sensible conclusions, however unpromising its origins. I have some suggestions about things which could helpfully improve things for all the stakeholders, not just a few of them. Ill post them later. In the meantime have a look at the responses the review has garnered so far at the IPO website.

It has certainly got people thinking.

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Mish-mashing-up

Mar 22, 11 3:22 PM

One of the things copyright is often accused of unfairly preventing, which in turn inhibits creativity and innovation, is so-called “transformative use”. That is, taking someones work as the starting point for your own, and sufficiently changing it so that a new work is created. Currently, in the UK, this mostly still requires a licence because the new work still includes the old one so no one person has the whole copyright. In the US, as a consequence of their “fair use” laws (and a load of litlgation over the years), some of this is allowed. And there are now calls to adopt a similar approach in the UK.

I am always slightly surprised that this is held up as a desirable thing. I sort of assume, rather rudely, that those who advocate it dont have much imagination of their own. Obviously people have been transforming each others work for donkeys years (think about sampling) and equally obviously its not impossible to get permission for this at least some of the time. But I always thought copyright was intended to promote and protect originality. Creatvity, surely. implies creating something. Not just giving something a make-over. New things, rather than iterations of old things. A really nice photocopy, or a cleaned-up photo, surely shouldnt be considered new works in their own right? Thats why copyright doesnt apply unless a work is in some way creative and original.

In fact I have always thought that one of the rather brilliant balancing acts that copyright performs is to prevent appropriation of someones work while allowing – encouraging, even – inspiration. Most original thoughts have their roots in something else. One thing leads to another, and what eventually emerges might bear no similarity at all to the thing which inspired it. You hear a song, and it makes you think, and a bit later a song of your own emerges*

This balancing act is brilliant not just because it creates a sensible compromise but also because it encourages widespread distribution of work. Most creative people are happy and flattered that their work might inspire someone as long as it isnt appropriated… feeling confident of that creates the confidence to publish widely. The more there is out there, the more there is to be inspired by, and the more gets created. If I were a management consultant I would call it a virtuous circle (and send a bill for several thousand pounds).

My questions are these:

Even though its undoubtedly true that transformative works can be brilliant and hugely enjoyable, why does that mean they should be protected by a legal right?

Why shouldnt I, as the creator of something, be able to benefit from the use someone else makes of it?

Equally, why shouldnt I be able to prevent them using it if I dont like what theyre doing? Even if other people think its great, if my work is recognisable in theirs. surely I should have a say?

And, from a public policy point of view, shouldnt we prefer a law that encourages true originality over endless iterations of past work? Which pushes beyond just re-cycling the past, with the risk of creating a colourless hybrid of indeterminate origin in the place of true creativity?

Surely we dont want a world of mash-ups to create a future which is just a mish-mash…

*for people who remember Lloyd Cole and the Commotions, and “Are you ready to be heartbroken”, check out “Lloyd, Im ready to be heartbroken” by Camera Obscura. Twenty years on, not copying or mashing up anything, but the inspiration is clear…

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Welcome to the Copyright Blog

Mar 20, 11 12:27 PM

I planned this blog with an agenda to put the case for copyright, to bring a positive message about it to the sea of negativity and to explore what the future might hold with an open mind. 

There are many voices loudly and frequently raised which rail against copyright. It inhibits entrepeneurialism. It locks knowledge away. It protects the interests of big corporations and restricts the freedom of ordinary people. It inhibits innovation on the internet. And countless variations on the theme.

I disagree with all of these and most others besides. I think – and my long experience confirms – that copyright has been, and still is, a hugely positive driver of many of the things is stands accused of inhibiting. I think its principles are fundamentally right and that while it needs to evolve as the world it exists in evolves that doesnt mean it needs to be destroyed. I think the debate, and the arguments of those who participate in it, are often simplistic, disingenuous and mask commercial interests.

Equally, its obvious that the issues which give rise to all these arguments are real, even if I disagree with the conclusions. The internet changes everything, so it seems, to its tempting to conclude that everything needs to change.

I want this blog to help raise the debate and avoid over-simplification. I want to discuss ideas and perspectives without getting bogged down in quasi-legal academic arguments and pedantic hair-splitting. I want to consider the issues from the same real-world perspective that I have had throughout my career managing, acquiring and exploiting copyrights. I take a practical approach to practical problems and think that is the right way to make copyright fit for the future. 

Im not a lawyer and I bring a practitioners perspective to things as I see and understand them. I start this as a true believer and a passionate advocate for all that good that copyright does. Having an open mind means Im willing to be persauded otherwise. I doubt I will be, but it will be interesting to see.

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