Content  Market
 
Professor Lawrence Lessig, Stanford Law School
 
Lessig:
 
If synthesize technology, law and market together you may see a change in the market otherwise not seen directly.
 
You are now ready to be “brainwashed” to accept this concept of free culture (ok, he’s jokin)
 
Free markets, free will, free willie…
 
But we are not saying free in terms of cost but in terms of characterization of the ecosystem (free trade vs free beer)
 
Am not endorsing world where artists don’t get paid
 
…
 
1928 – Walt Disney
 
1.      Created steamboat willie
a.       Gave birth to Mickey Mouse
b.      Which gets us to Disney Co
Buster Keaton (1928) created Steamboat Bill which is the source of Steamboat Willie
 
This is a kind of creativity – walt Disney creativity – always parroting feature length films – always building upon work in public domain.
 
Free culture is the freedom to take change and release adaptations of the culture around you…
 
Speaks of “dojinshi” copycat comics in Japan – and the creativity it drives 
 
Why was Walt Disney creativity possible?
 
1.      Legal Reason
a.       Duration – copyright supposed to be a limited time
b.      Important thing to focus on – public domain is the “lawyer free zone” where you don’t need to ask anyone what to do with that culture.
c.       Before 1774 in anlgo American tradition – copyrights were perpetual – House of Lords determined that terms were limited
d.      American constitution then replicated that idea that at some moment the item would pass into public domain
e.       Vast majority of work was public domain from time of creation as no one chose to exercise their right
f.        Avg copyright term has tripled in last 30 years (1973 – 28 years with a renewable term – 32.2 years avg) today it is maximum of 95 (courtesy of Sonny Bono Copyright Term Exension)
g.       Since copyrights don’t have to be registered – you don’t even know where to start to get permission to modify a work
2.      Technology
a.       Reach of copyright
                                                                                                   i.      Regulates techs that copies
                                                                                                 ii.      Fair use
1.      quote
                                                                                                iii.      Enter Internet
1.      now every act is a copy
2.      Copyright Office says you can have an action against you for using a work without owner’s permission.
                                                                                               iv.      Before Internet
1.      Law was controlling (i.e. a Judge has to look at complaint)
                                                                                                 v.      With internet –
1.      You argue with the machine  (controls, etc) – regulated by the code that gives you access to the work
                                                                                               vi.      Talks of aibopet.com –
1.      teach you Aibo jazz
2.      But, the DMCA says the dog can’t dance
3.      so you have law protecting code protecting law
3.      Market change
a.       Concentration (extraordinary)
                                                                                                   i.      Copyright is a monopoly
                                                                                                 ii.      Framers limited power of that monopoly
                                                                                                iii.      But the pettiness has changed
1.      Size – 80% of music by 5 companies
a.       70% of radio by 4
b.      80% of newspaper
c.       only .5% foreign films in market
2.      scope
a.       1969 – Lear – Archie Bunker
b.      ABC wanted him to tone it down
c.       He got racier every time
d.      So he took it to CBS
e.       That was artistic control rule at that time separated content from conduit
f.        1994 a change in rules – abolished Fin-Syn rules
                                                                                                                                                                           i.      Valenti fought (get those quotes) in congressional testimony saying the customer would lose.
g.       FCC relaxed ownership rules on media
4.      Never have a fewer number of actors exercised more control over development of culture.  So no one can do to Disney what Disney did to the Brothers Grimm
5.      This is insane, unintended consequence of the confluence of these changes – 200 years of lobbyists pushing on one side of equation.
6.      Property v. piracy
a.       1995 Eldred starts building free library
b.      1998 Sonny Bono Act took some works out of domain
c.       gave birth Eldred v. Ashcroft
d.      Court said up to congress
7.      Two ideas for alternatives
a.       ALL
b.      NONE
c.       But there is room for SOME
d.      Solving for the extremes denies SOME
e.       Creative Commons provides for the middle (SOME)
8.      Defending “fair use” is bad way of understanding what we want.
a.       Ought to discuss free use.
 
Fisher
 
Another proposal in the same spirit of moderation and aspiration to craft a legal system that simultaneously respects legitimate interests of creators while affording maximum oppties for consumers to access it and exercise their creativity.
 
Specific target is music and film industries. 
 
Remember, evolution of legal system has been interpreted to impede benefits of internet distribution of digital entertainment.
 
A couple of ways to look at
 
1.      To enhance property rights
2.      Regulate the industry
3.      An alternative compensation system
 
Governments have experimented on managing problem of underproduction of public goods
 
1.      Government provides it (armed forces, light houses)
2.      Government subsidizes it (e.g. NSF)
3.      Government issues prizes (reward system for atomic energy inventions)
4.      Government confers monopoly power on producers
a.       e.g. 19th c. toll roads, intellectual-property rights
5.      Govt assists private parties in increasing “excludability”       
a.       Trade-secret law
b.      Anti-circumvention law
 
Strategy 4 and 5 are not working any longer as mechanisms
 
Recommendation is to reconsider merits of strategy 3
 
How work? (details at www.tfisher.org )
1.      Register
a.       Copyright owners get unique id #
b.      Unique id # inserted into file name
c.       Application designates
                                                                                       i.      Any other registered digital recordings incorporated into the work
                                                                                     ii.      Duration of the incorporated work
d.      Registration fee
2.      Taxation
a.       Provide creators full social surplus of their efforts
b.      Fairness
c.       Make creators, as a group, whole
d.      Preserve a flourishing entertainment culture
 
So what would that cost
1.      Music Industry ??? billion (taking from published estimates of losses
2.      Film - $1.7 billion
3.      Admin costs
4.      Total 2.4 billion
So he runs tax tables on cds, internet access, etc to pay for this
3.      Count consumption
a.       Webcast play lists
b.      Count downloads
c.       P2p systems county sharing registration numbers
d.      Surveys
e.       Sales of pre-recorded cds
4.      Payment
a.       Distribute money in proportion with frequency that each creator has works consumed
5.      Lift copyright system and DMCA
 
Who gets hurt?
1.      Manufacturers
2.      Distributors
3.      Retailers
4.      Record Companies and Studios?? Only if they don’t change business model
 
Demerits of plan
1.      Distortions and Cross-subsidies
2.      Giving a govt agency considerable power