Why The Copyright System is Broken

Note: A commenter has alerted me that some of the material with regards to Disney is not my own but belong to Doctor Lawrence Lessig. I am a big fan of his so I am embarrased I didn't know. A friend on IRC suggested the idea to me, and I thought it was great (not knowing he lifted it from Lessig). I am going to keep the content up, and provide a link to Dr. Lessig's presentation. He is much smarter than I am, give it a read.

I am worried about the future. We have increasingly devastating natural disasters, immorality and violence, but people are working on these problems. They do not bother me much. I am worried about where our culture is going.

By culture I mean traditional media: literature, music and movies, as well as nontraditional creativity: computer code, hardware, and science. It isn't the content itself that is troubling, though we have problems with that, but the freedom this content no longer enjoys. Legislative copyright trends allow less and less freedom, and this will damage our future.

Copyright laws have existed for some time. In 1710, English copyright laws had a 14- year statute of limitations. In 1769 London publishers, seeking to protect their monopoly on classics, succeeded in extending copyrights forever. Five years later this ruling was overturned. Can you imagine a world in which only London publishers could print Shakespeare, Milton and others?

This sort of battle has been waged as long as control and reproduction of creative works has been possible. The founders of the constitution understood the conflict between copyright holders and everyone else. To address this conflict, the purpose of copyrights was included in the constitution.

“[Congress shall have power] To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries."

To encourage creativity, copyrights grant temporary monopolies to inventors to recoup losses incurred during research or development. This is as it should be; science is expensive, art is valuable.1 After a “limited time” these works fell into the public domain.2 There, anyone can use them, publish them, copy them, and make derivative works, all without permission.

Why should we care? Progress has always built on the past. Literary theory supports what seems common sense; what we create has roots in what we know. The past has always tried to control the future use of its works. This includes computer code, literature, media, science, et cetera. Culture is free so long as the past is prevented this control. If control by the past is always allowed, permanent monopolies would ensue. An oligopoly of incumbents could control culture by allowing or disallowing use of their works.

An example to illustrate. In 1928 Walt Disney created Mickey Mouse with “Steamboat Willie.” It was a parody of a full-length live-action feature film named “Steamboat Bill” released the same year. Walt didn't wait 14 years, he just used it. Disney continued the tradition of using works in, the public domain to create the Disney classics we now cherish. Many of these were lifted from the Brothers Grimm. If there was no public domain or copyrights had been enforced as vigorously as they are now; there would be no Disney movies. Ironically, with media corporations pushing for extended copyright legislation, Disney (and others) is ensuring that no one will do to them what they did to the Brothers Grimm.

Now a brief overview of current copyright laws in America. Initially, we adopted British common law. This included copyright laws with the 14 year statute of limitations. In 1831 the length was extended to 42 years, 56 in 1909, and starting in 1962 a barrage of extensions ensued. Legislators prolonged the copyright duration eleven times in the last 40 years- not just for new works, but existing works too. The length now stands at the creator's life plus 50 years or 75 years. Do music artists really need life + 50 years to “recoup their losses?” Do we really want all our artists motivated strictly by financial gains, rather than a love of music?

Despite how onerous the length of current copyrights is, far more insidious forces are at work in the United States. Expansion of copyright holder rights has accelerated at a ridiculous rate. Formerly, there were three divisions of rights: unregulated, fair use and regulated. Unregulated uses included reading the media, selling it, giving it away, anything not explicitly in the other two categories; these were rights copyright holders couldn't touch. 'Fair use' covered rights that would have been protected by copyright but were explicitly allowed: derivative works, personal copies, citations, and other non-commercial uses. Copyright covered a small area of rights: publishing and copying for profit. Copyright did not cover distribution, personal copies, or a slew of rights that have been recently abdicated to copyright holders. These lost rights now make it impossible to legally make a copy of a DVD for personal use or resell a software license.3 The next generation of DVDs will further defenestrate our rights, for example Blu-Ray players “call home to Sony” for permission before playing the movie. All these rights, once ours, have been lost to the copyright holders.

The increasing statute of limitations and decreasing user rights are destroying the public domain. Without this, “new Disneys” are kept out by the old Disneys. Losing out on the potential gains which a new Disney could bring is clearly a net loss to society. The only offsetting gain is the increased profits the old Disneys receive from enjoying a continued monopoly; profits which are arguably less than the potential gains from a “new Disney”.

With the computer industry forced to take orders from media conglomerates under threat of 'enabling infringement' litigation, our direction is clear. People don't realize that right now culture is more controlled than any before has ever has been. Before the erosion of personal rights, if you wanted to understand how an invention worked, you could look at it (or the patent). With patents and copyrights now locked under the guise of being 'proprietary', inventors can no longer build off of others. With technology advancing only where copyright holders approve, culture is controlled at an increasing rate.4

Even now, companies gobble up patents and copyrights of dubious creativity. Microsoft has patented the double click, Amazon.com patented keeping an online history, Rio has patented hierarchal displays (which is being used to sue Apple), and on and on. Although companies claim these are 'defensive' patents to protect themselves from frivolous litigation, they are often used 'offensively.'5 Prior art is ignored, alternative compatible solutions are outlawed by the Digital Millennium Copyright Act (DMCA), and monopolies that never should have been, are now enforced by the government. The costs alone of navigating this legal minefield, never mind licensing costs for trivial inventions, are enough to prohibit new firms or individuals from entering and innovating.

Another issue is “probabilistic patents.” Lobbyists claimed that research now takes so long that innovators need patent protection on inventions that they 'intend' to create. So that big bad Microsoft doesn't swoop down and make it first. The problem with this is that, no one knows if the innovator will ever be able to produce the invention they intend to create. This bars all others from actually making such a device.

A perfect example of this is RIM and the Blackberry. They made a terrific device that got email, and all sorts of things wirelessly, like a cell phone. Well guess what, someone owned a patent on fairly specious grounds (they had never and still have never made the device they patented), vaguely resembling the Blackberry. So who loses? RIM who made the blackberry. Any user who bought a Blackberry. What was preserved? The rights to sue others over patents you never developed.

I hope this seems as insane to you as it does to me. Does it make sense that rightnow, you can more jail time for videotaping a movie in a theater than for rape? Does it make sense that recording industries can sue for over $1500 per song shared on peer-to-peer networks?6 Does it make sense that the content industry (those creating movies, music, et cetera) can hold hostage the entire technology industry over these copyrights?

No one is fighting this because of asymmetric returns. Licensing basic technology (such as the double click) may cost each user only a dollar, but benefits copyright holders quite a bit. It is simply not worth fighting to those who are injured by the copyright, but it is worth enforcing for the holders. Hence copyright holders are winning all the battles.7

Why does this scare me? I worry about the next generation of computers, further locking down distribution. The Intel VIIV push is all about this and DRM8 (digital rights/restrictions management). I worry about the future. When firms, through technology and litigation, will govern creativity. When royalties must be paid on copies of works by Da Vinci, Dickens, and Stallman. When future artists and innovators, cannot create because of ridiculous and expired patents on everyday ideas. When faceless firms control all current and future uses of science, computers, music, movies and literature.

1 It is interesting to note, copyrights do not exist to benefit the inventors; but to encourage more creation.

2 This is less and less true, as I will explain later.

3 The Digital Millennium Copyright Act (1998) makes it illegal to circumvent copyright protection regardless of the reason. To copy (or play) a DVD you have to break Content Scrambling System (CSS), remove Macrovision, and sometimes region encoding, all three of which are protected by the DMCA. Thus copies and unlicensed players are illegal. So playing a DVD on Linux is illegal since there is no licensed software. Similar restrictions (EULAs) keep you from reselling your software, so if you just bought a new version of MS Office, you can't legally sell your old one.

4 This only applies in industrialized nations. With 3rd world countries refusing to grant these old world monopolies, innovation is moving overseas at a frightening rate.

5 A study of 354 technology firms in 2005 found that they currently face an average of 42 lawsuits each, the greatest contributor being copyright infringement.

6 A new law mandates $1500 for each work infringed on. Piracy figures in general have been thus inflated.

7 Copyright holders are clearly winning legislatively, but claim to be losing billions to piracy. Economists dispute these losses. Pirates are, on average, poorer than non-pirates (most are the young and people in 3rd world countries). They argue that not every person who pirates a movie, CD, piece of software, et cetera, (especially in 3rd world countries where piracy is rampant) would be able and willing to pay full price for what they pirated. So if pirates, on average, can not afford the intellectual property they pirate, have the industries really 'lost' any money? There are quite a few academic papers which explain that industries have not lost much to piracy (despite the inflated values they give) and in many cases have seen increased revenue from piracy.

8 DRM is more and more the way things are going. For an excellent discussion on the goals of DRM see this rant.