(originally written for ALARM Magazine in January 2009)
The elephant in the room of the recording industry trampled the entire business. A decade ago, no record company wanted to address Napster as anything but a criminal enterprise, and that obvious shortsightedness has plagued them ever since. While they try to come to grips with the aftermath of their missteps, the same elephant now lurks in the boardrooms of companies that produce television and films. Despite the scrambling of these companies to prove that they’re hip to what consumers want by offering shows online and on-demand, the fact remains that, as technology improves, it will only get easier for consumers to obtain their products through the same kind of file sharing that wrecked the record business.
While the unraveling of the record industry may not have been a totally bad thing for music as an art form, it could have much more dire effects on visual media due to inherently higher production costs. The internet has allowed musicians to write, record and produce work without the costly physical distribution that big record companies thrive on. But big budget TV and film carry with them the costs of writers, actors, directors, set designers and a host of other personnel and infrastructure that are necessary for a great visual production. If the same problems that the record industry encountered with file sharing technology are inevitable for television and film, then the question changes a bit. The music industry fell short answering, “how do we profit from this?” But the television and film industries really need to answer the question, “how do we pay for this?”
Fortunately for television and film, they can look to the mistakes and evolution of music for a guide. However, as more people are fast-forwarding commercials on their DVR’s and downloading series through torrent sites, they need to make some decisions rather quickly to support their business and avoid the same fate. There are two very serious questions here. The first is how to develop a business model to compensate those involved with the production. The second is how to reform and evolve copyright law to make sense in the digital age.
The issue of a legitimate compensation model is no easy question. Models that rely on downloading from a single source, like iTunes or eMusic, seem to be fighting the tide of technology, in which peer-to-peer file sharing is clearly dominate. One possibility, advanced by the Electronic Frontier Foundation (www.eff.org), is a “voluntary collective license,” in which ISP’s, institutions, and individuals would pay a small amount per user each month to have unlimited access to copyrighted material through licensed p2p networks. The alternative is government regulation in the form of a tax on technologies that provide access to this media (computers, ipods, ISP’s…etc). In either case, the money is pooled and paid out to artists or organizations based on how often they are downloaded.
Both of these models resemble the outcome of a dispute record companies had with radio stations decades ago that resulted in the creation of ASCAP and BMI. Record companies wanted to know how they could get paid for the broadcast of their songs in markets all over the country, and before lawsuits could swallow the whole industry, these publishing houses were created to collect license fees from radio stations. Then they pooled the fees to pay out record labels for the use of their music. While these institutions are far from perfect, at least they hint towards a sensible business model for Internet media in an era where none yet exists.
The surprisingly more difficult issue may be the reform of our copyright laws, which are sorely out-of-date and twisted from years of lobbying by big media companies. Initially, copyright law was created to spur innovation and encourage creativity. If you created a work, the right to profit from that work was guaranteed for a limited time so an artist or author could pay the bills while working on their next project. This right was never conceived to provide companies like Disney the ability to build their brands around copy protected material, or to grant the descendants of songwriters the ability to make millions off their grandparents work. Neither of these scenarios contain any real societal benefit, and yet the government protects them through a distortion of the intentions of copyright law, garnered through years of political contributions from companies and individuals who wish to retain the right to profit from this work, usually long after the creators have deceased.
The time has come for this madness to stop. It doesn’t make much sense to begin with, and it makes even less sense now in an era where sharing and recreating other work is the norm. I can understand copyright terms lasting 10 or 20 years, maybe even through the life of the artist. But there is no public benefit to protecting someone’s right not to need a job because their grandfather wrote a popular song. They can inherit all the money their grandfather made, but inheriting the exclusive right to profit off of creative work goes a step too far.
This is not dissimilar to the way drug patents work. The company that creates a drug retains the exclusive right to produce it for a number of years, after which its patent expires and other companies are permitted to produce generic versions. This allows the company to take the profits from having exclusivity on one drug, and put them towards development and research of the next. They can continue selling the original as the “name brand,” but other companies can use the formula. This makes it more profitable to develop new and better products than it is to focus on cornering the market on an old one. Setting aside the host of other problems with the pharmaceutical industry, it may just be the right kind of model for copy protection of creative media.
Requiring more material to eventually fall into the public domain would be a great thing for art, technology, and probably even business. There’s endless potential for remixing and reusing old work in new ways, and it could all be shared, traded, and remixed again on the web. Media companies would be forced to put all their efforts towards producing great new work, rather than spending vast resources protecting revenue from stuff they produced 30 years ago. Just as any filmmaker can make their version of Hamlet, any production company could make their own prequel to Star Wars. I think it’s safe to say we’d get a better one that what we got.
These are complicated issues and I certainly don’t have all the answers. But we must start seriously addressing the questions by taking into account the opinions of academics and economists, by looking at the potential benefits for society, and by no longer allowing companies that just want to protect their revenue on old products to dominate the conversation. Most of all, we need to examine the implications of where technology is taking us, and realize that we’re headed there whether we like it or not.
The elephant in the room of the recording industry trampled the entire business. A decade ago, no record company wanted to address Napster as anything but a criminal enterprise, and that obvious shortsightedness has plagued them ever since. While they try to come to grips with the aftermath of their missteps, the same elephant now lurks in the boardrooms of companies that produce television and films. Despite the scrambling of these companies to prove that they’re hip to what consumers want by offering shows online and on-demand, the fact remains that, as technology improves, it will only get easier for consumers to obtain their products through the same kind of file sharing that wrecked the record business.
While the unraveling of the record industry may not have been a totally bad thing for music as an art form, it could have much more dire effects on visual media due to inherently higher production costs. The internet has allowed musicians to write, record and produce work without the costly physical distribution that big record companies thrive on. But big budget TV and film carry with them the costs of writers, actors, directors, set designers and a host of other personnel and infrastructure that are necessary for a great visual production. If the same problems that the record industry encountered with file sharing technology are inevitable for television and film, then the question changes a bit. The music industry fell short answering, “how do we profit from this?” But the television and film industries really need to answer the question, “how do we pay for this?”
Fortunately for television and film, they can look to the mistakes and evolution of music for a guide. However, as more people are fast-forwarding commercials on their DVR’s and downloading series through torrent sites, they need to make some decisions rather quickly to support their business and avoid the same fate. There are two very serious questions here. The first is how to develop a business model to compensate those involved with the production. The second is how to reform and evolve copyright law to make sense in the digital age.
The issue of a legitimate compensation model is no easy question. Models that rely on downloading from a single source, like iTunes or eMusic, seem to be fighting the tide of technology, in which peer-to-peer file sharing is clearly dominate. One possibility, advanced by the Electronic Frontier Foundation (www.eff.org), is a “voluntary collective license,” in which ISP’s, institutions, and individuals would pay a small amount per user each month to have unlimited access to copyrighted material through licensed p2p networks. The alternative is government regulation in the form of a tax on technologies that provide access to this media (computers, ipods, ISP’s…etc). In either case, the money is pooled and paid out to artists or organizations based on how often they are downloaded.
Both of these models resemble the outcome of a dispute record companies had with radio stations decades ago that resulted in the creation of ASCAP and BMI. Record companies wanted to know how they could get paid for the broadcast of their songs in markets all over the country, and before lawsuits could swallow the whole industry, these publishing houses were created to collect license fees from radio stations. Then they pooled the fees to pay out record labels for the use of their music. While these institutions are far from perfect, at least they hint towards a sensible business model for Internet media in an era where none yet exists.
The surprisingly more difficult issue may be the reform of our copyright laws, which are sorely out-of-date and twisted from years of lobbying by big media companies. Initially, copyright law was created to spur innovation and encourage creativity. If you created a work, the right to profit from that work was guaranteed for a limited time so an artist or author could pay the bills while working on their next project. This right was never conceived to provide companies like Disney the ability to build their brands around copy protected material, or to grant the descendants of songwriters the ability to make millions off their grandparents work. Neither of these scenarios contain any real societal benefit, and yet the government protects them through a distortion of the intentions of copyright law, garnered through years of political contributions from companies and individuals who wish to retain the right to profit from this work, usually long after the creators have deceased.
The time has come for this madness to stop. It doesn’t make much sense to begin with, and it makes even less sense now in an era where sharing and recreating other work is the norm. I can understand copyright terms lasting 10 or 20 years, maybe even through the life of the artist. But there is no public benefit to protecting someone’s right not to need a job because their grandfather wrote a popular song. They can inherit all the money their grandfather made, but inheriting the exclusive right to profit off of creative work goes a step too far.
This is not dissimilar to the way drug patents work. The company that creates a drug retains the exclusive right to produce it for a number of years, after which its patent expires and other companies are permitted to produce generic versions. This allows the company to take the profits from having exclusivity on one drug, and put them towards development and research of the next. They can continue selling the original as the “name brand,” but other companies can use the formula. This makes it more profitable to develop new and better products than it is to focus on cornering the market on an old one. Setting aside the host of other problems with the pharmaceutical industry, it may just be the right kind of model for copy protection of creative media.
Requiring more material to eventually fall into the public domain would be a great thing for art, technology, and probably even business. There’s endless potential for remixing and reusing old work in new ways, and it could all be shared, traded, and remixed again on the web. Media companies would be forced to put all their efforts towards producing great new work, rather than spending vast resources protecting revenue from stuff they produced 30 years ago. Just as any filmmaker can make their version of Hamlet, any production company could make their own prequel to Star Wars. I think it’s safe to say we’d get a better one that what we got.
These are complicated issues and I certainly don’t have all the answers. But we must start seriously addressing the questions by taking into account the opinions of academics and economists, by looking at the potential benefits for society, and by no longer allowing companies that just want to protect their revenue on old products to dominate the conversation. Most of all, we need to examine the implications of where technology is taking us, and realize that we’re headed there whether we like it or not.
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