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Harvard Business School: Weaker Copyright Benefits Society

(9 posts)
  • Started 1 year ago by missing_kskd
  • Latest reply from missing_kskd

  1. And this from the most brutal of the MBA schools there is!

    http://www.unc.edu/~cigar/papers/File-Sharing_and_Copyright_2009-05-16.pdf

    Holy crap!

    I do find the paper is weak on contributing factors, such as the much lower barrier to entry surrounding creative works of nearly all kinds we see today. Not sure factoring that in would change their core position, but it's a consideration I don't want to ignore.

    What I find very significant is some resonance with themes I've posted here over the years. One in particular is the actual value of recorded music is going down. More music being produced, more easily available, and distributed for almost no cost. Heck, we can e-mail tracks to one another with no pain at all!

    On one hand, artists can now sell directly to interested fans. Volume goes down, but margin goes up.

    Another element is the music generally supporting secondary revenue generating activities, such as concerts, AD's and other things. The tests we've seen with direct sales, buy it for what it's worth sales, the "tip jar" approach where it's listen and if you like it, pay something deal all appear to leverage the secondary activity along with actual selling / distribution of the music.

    Finally, where a work is widely avaliable for download, offering it and becoming the de-facto authority surrounding access to it can harness a lot of eyeballs. Those eyeballs and mind-share then can get funneled into these secondary activities for profit.

    Given that a very large number of the infringements (downloads from unauthorized distributors) are not really lost opportunities, this presents as mostly added income that the artist can command a nice margin from that would otherwise not be on the table.

    That's an interesting dynamic where dealing with the major labels are concerned, isn't it? I sure think so.

    Inhibiting the free distribution with artificial hardware blocks, taxes, DRM and other things simply serves to dilute these potential new revenue models in favor of the tired not wired ones we see from the majors, who appear to be absolutely dead slow to innovate.

    That lack of innovation appears to be control driven, and it hurts artists more than it helps. Well, maybe not the approved corporate stars we have to deal with at any time, but pretty much everybody else is getting screwed, IMHO.

    That's it. Just some ramblings on a topic I always find interesting. Thoughts from you guys?

    Posted on June 18, 2009 - 02:24 AM #
  2. skeptical

    vacuum tube
    Posts: 1,512

    How about a simple tax on ALL things downloaded to be redistributed to content owners who register a work at a clearinghouse whose job is to divvies up the money according to percentage of downloads per content.

    The idea is that it won't matter if the contents is "stolen", you'll still get paid. For this program to work, EVERYTHING will be flat taxed, including things with an expired copyright or public domain stuff. This pool of money will run the program and encourage artists to register their work if they want to get paid.

    Keep in mind we're talking a fraction of a penny per download. The funds generated from taxes on the free stuff should make up the bulk of the income to offset the low cost.

    This is not entirely my idea. I'm sure one or more of you heard stuff like this before.

    Posted on June 18, 2009 - 04:14 AM #
  3. skeptical

    vacuum tube
    Posts: 1,512

    This was an echo that I just deleted.

    Posted on June 18, 2009 - 04:14 AM #
  4. Great topic Missing. You nailed down some important points. This is a discussion that has been engaged quite a bit in the recording community. Copyright issues abound in every corner of the industry. One could easily believe that honest original music lives in a nest of spotted owls high in a Sequoia somewhere near the roaring waters of the last unspoiled salmon run.

    I am not sure that strong copyright and patent protection would solve all of the problems, but I am skeptical that a public domain world is smart either. Abuses of invention and intellectual works erode overall value. It means that dullards who are good salesmen just have to wait for the latest idea from someone who has much more brains and far less capital. Factory workers always replace artisans in this model and eventually the workers are replaced by automation. Automation and imagination do not coexist very well. The parallels are pretty similar across the board since mass produced instruments, music publishing and eventually recorded works all developed out of the industrial revolution.

    Synthesizers may have spelled doom for session musicians, but samples have taken over for songwriters. Even in genres uncluttered by cut and paste, many ideas are note for note rewrites. Not a nod, or a tribute, but theft. Folks who score commercials are often the most brazen. Publishers and royalty organizations are so cozy and consolidated that they control every version anyway, so the needs of the individual artist do not matter if their money keeps coming.

    A home studio is the most common way that music is recorded these days. Most consist of gear purchased at big box outlets and on-line retailers. Virtually every new product available is a dismal halfhearted copy of something else and few manufacturers so much as apologize for it. Software has taken over from the small electronics firms who made money from outboard gear and amplification. Far away industrial districts and shipping lines have taken over for towns full of luthiers and craftsmen. While Chicago, Kalamazoo, Fullerton and Westerly were once known for incredible instruments, and Los Angeles, Memphis, New York and Detroit were once know for incredible recordings, in our current model, few communities are sustained by this billion dollar empire.

    Just for fun and the sake of argument, here is an all too typical scenario replete with snark:

    In a rock or country trio it is not unusual to have a guitarist, bassist and drummer all playing inferior Asian copies of tried and true American designs like the Les Paul, Precision, Stratocaster or Ludwig. Their amplifiers follow the same pattern of looking like a British Vox or Marshall. Amps take it a step further by attempting to simulate the natural behavior of simple electronics with a rinky-dink computer. To make matters worse, the market is flooded with outsourced facsimiles that were actually authorized by the bloated multinationals that pose as originators like Fender and Gibson et al.

    To capture our illustrious crew, we will need a basement studio. A typical setup would include a couple of condenser microphones that are lousy Chinese copies of German designs, a handful of dynamics made by once solidly American companies like Shure, but are now produced in Mexico, and a bunch of cables and accessories that are almost impossible to find manufactured stateside. If one has a small mixing console like a Soundcraft, it is not from London anymore, but somewhere unpronounceable.

    Being a good musician is not as important as being a good editor because all of this glorious saccharine and spam is fed into a memory box. The computer has an operating system that was stolen from a couple of people by another couple of people who ended up very wealthy from the idea. Additionally, each note can be micromanaged by plug-ins that pretend to be outboard gear that used to be built by folks at Universal Audio or Pulse Technologies. Not only are these simulations, but many users do not even pay for the software. Entire studios are based around free pirated cracks of hundred dollar copies of thousand dollar pieces of gear.

    Much of this simply boils down to paying for an idea. If an artist or record label wants to be paid for their ideas, then perhaps they ought to think about that all the way down the line. Getting something for nothing is not a new thing, but in some ways, today's music industry may have even fewer qualms than their scandalous forebears. They take rather than make. Far too few insist on paying fellow citizens for crafting the tools of their trade. They expect to earn a living wage in this country with their music, but they do not care about jobs stolen by outsourcing. Many refuse to even invest in the simulated software versions of technological developments that enabled them to share their music. Fewer still acknowledge the centuries of hard work that led to people getting paid for putting a melody in front of a crowd.

    So, one could say that having a stolen song, played on stolen instruments, recorded on stolen gear, promoted by laundered money and spread around the world with stolen downloads is the way people get famous now. That's Showbiz Folks!

    Posted on June 18, 2009 - 07:17 AM #
  5. Oh I agree that a public domain world isn't the right way to go either.

    I do know that very long copyright isn't as good for us as it is good for very large corporations. I would cut it back a bit, so that the public domain is actually robust. Ongoing extensions are theft from us as a society as sure as rolling a few samples loops for that next hit is. Very little of that discussion makes sense at the extremes. Good balance in the middle is the ideal scenario.

    The home studio with copies of software isn't cool either. Frankly, the copy of very expensive gear problem is solvable. If there is that much interest in high end audio processing software, then we solve it by either making the software more accessable, or we apply the principles of open code to the problem and simply code the infringment away, thus forcing the keepers of the high end stuff to either innovate, or slowly wither away.

    That principle on software is universal for me. As we gain common understanding of complex things, we lose the need for large corporations to rent that understanding to us in the form of expensive, closed software.

    Infringing on the status quo is not cool, but for the people wanting to learn. I've always been for that and always will be. The big companies should be so lucky that people are willing to make the investment and present themselves as a sales opportunity or billboard for their wares.

    Sorry if that offends, but that's universal for me too Right to learn trumps right to make money every time, simply because to make the money, one has to learn to earn.

    Production use of unauthorized software copies, obtained from infringers is not acceptable.

    I'm of mixed opinion about note for note copies. For very short expressions, I don't think strong copyright on note sequences makes a lot of sense. The discussion has to involve overall context, lest we just decide to rent the scale out for new authors. That's not cool. For longer ones, or extremely distinctive ones that are relevant, protection is necessary, but the term is too long.

    No creative work should stand so long that the author of it no longer has to create for the rest of their days.

    I can't help but wonder in the current long term, aggressive scenario, whether or not that discourages people in some ways. All creative works build on those that came before. Our words, thoughts, even stories for the most part have been spoken.

    Extending the ownership term limits expression and that limits the evolution of new culture. This could be a big part of just WHY we have the rip, mix, score! culture we have right now. Being just lazy is a factor too however. When it's possible to assemble, not compose, your next big hit on the plane ride to the next gig, is that because too many people are stealing and lazy, or is it because our expectations of what is creative have been managed to the point where it just doesn't take much to entertain?

    I often lean toward the latter and peg that right on the ass of very long term copyright. When the food avaliable to create with is bland, stale and old, the resulting works won't be as good will they? With that comes the setting downward of expectations and here we are.

    Interesting counter point no?

    Then we come to recorded music. For whatever reasons, it's simply not worth today what it was. Live music is still worth a lot however. I don't know if that's a bad thing either.

    When I see it live, I'm there in the moment having an experience. This is a shared thing between everyone in the venue. It is a thing to remember with the recording later, but the real experience is at the show where it's always been.

    The low barrier to entry for recorded music, coupled with near zero cost distribution means even if we clean up copyright, recordings are going to have a lower value than they otherwise would. That ship has sailed and I don't see it returning to port no matter how draconian the law ends up being.

    It's pretty damn draconian right now. That's working isn't it?

    Not for me.

    And for the record, I rarely infringe. Used to when it was a new thing. What happened is I simply realized where the real value is, or have persued other entertainment forms. I don't really need big label music and movies. If they present a nice deal, I'll bite, but it's never ever going to be the same.

    A good analogy would be growing up on simple American food, then being exposed to gourmet dining, then finding out you can cook your own!

    Why go back to the processed, cheap fare?

    I got off the airplane recently to hear a guy playing his banjo. He probably was blowing off a little tension. For a few minutes I was lost in his simple, live tune. I walked over and thanked him, with the notes singing in my head on the way home.

    Recording that is meaningless. Experiencing it was worth a lot.

    Posted on June 18, 2009 - 10:08 AM #
  6. Missing, you make some really great points! Of course, I was playing Devil's advocate and generalizing, but I think there are valuable lessons to be gleaned from what the music industry has become.

    I completely agree that music is just like any other art. It is best to see it live and in the flesh. Unfortunately, television and the internet have greatly eroded the audience share. Folks who do venture out for something to do often end up at a movie or a sports bar. In a market that largely stays home for fun, it is mighty hard to sell first hand experience over reproduced or broadcast entertainment.

    Now, there are tangible benefits to file sharing that record companies do not like to acknowledge. A relatively unknown band does have the opportunity to go viral on the torrents under the right circumstances. They may reap the rewards on performances, but product is devalued. Midsized and smaller independent labels suffer much more from illegal downloads than the big boys. It makes it increasingly difficult for them to provide proper tour support if they are not getting steady revenue. In the long term, it bites everybody on the behind.

    When an artist gets old and grey, it would be nice if they could actually count on their recorded legacy to help support them when they can no longer perform. John Fahey released enough material in his prime years to have built that sort of portfolio. The fact remains that he spent time living in his car behind a Safeway. For whatever problems he had, there should have been a mechanism in place to ensure he got his fair share of income from his legacy.

    This twisted new world of "Why spend $50 on a ticket, two microbrews and a cab ride when I can steal their download and shoplift a 6-pack?" is not benefiting anyone. There has to be a better way.

    Posted on June 18, 2009 - 10:43 AM #
  7. The product is already devalued! That happened as an artifact of technical progress. There is really no going back on that one. Music is very easy technically. Artistically, nothing has changed, but for the expectation management problem we have right now.

    I think if we put as much effort into figuring out how to get people to go to a show as we do trying to hobble their gear and legislate their choices and license their creative ability and works, we may find there is plenty of money to make it work.

    I also think small labels could really put the squeeze on the big players with strong innovation. Some are trying and their results are mixed. Part of the problem here is I know many of them want to do that, but the law actually gets in the way.

    Those laws that serve the majors actually are double edged in this way. We should work on that too.

    If you've read Lessig, there are four means by which we regulate behavior:

    Law, money, norms and physics.

    We've way too much focus on the law, without enough on money and norms. That's my key gripe about the ongoing escalation of forces surrounding this matter.

    Posted on June 18, 2009 - 01:47 PM #
  8. Skep, the problem I have with the download tax is the mixed expectations.

    If we do actually charge the tax, then minor league infringement is socially acceptable then, right?

    Most of the content creators would argue NO, where most content consumers already have the expectation set that it's acceptable, or don't choose to infringe for their own reasons.

    It's a mixed message.

    When we buy Audio CD's, those are for Rip, Mix, Burn. Yet, we see companies like SONY always trying to deny people that option.

    So, which is it?

    If we answer that in a solid way, then a tax might be a consideration.

    BTW: In the early 2000 time, I watched as Napster suggested a bulk license for downloading on a subscription model. Market cap was in the trillions, and their starting offer was 2 billion a year to big media to start down that road.

    P2P had not yet been invented. Napster was a centralized file sharing system, and a $10 subscription obtained from a nice percentage of the 40 million users of that time would have delivered a freaking ton of revenue.

    Edit: They denied that then, neutered Napster and formed the perfect storm that would bring us distributed Peer to Peer. After a brief battle on that front, we got decentralized and encrypted Peer to Peer.

    They've seen enough to know they lose that one. So...

    That's being suggested again today, just like I said it would. Difference? The labels are doing it, not somebody else.

    Edit: Here's the play by play, written years ago. Absolutely nothing has changed, confirming my control, not revenue supposition.

    http://episteme.arstechnica.com/eve/forums/a/tpc/f/174096756/m/544098989?r=178096999#178096999

    And that's another rub with the tax. For the majors, this has never, ever been about revenue. It never will be, no matter how much they squeal about it.

    It's about control; namely, their control over culture. They are losing it, and know that when they do, they become less relevant and with distribution the way it is now, not needed in these times.

    Remember that when we talk about how this all goes.

    For the smaller entities, it IS about revenue and a lot of that IS about exposure. Can't sell a work nobody knows about, and the big promotional channels are all owned by the majors, meaning small and indie get locked out a lot.

    Remember that too, when the tax goes to these major organizations that seek control, not more profits for those artists they are pimping out at their pleasure.

    And that takes me right back to who should benefit from it. If we have things like compulsory licensing, and taxes, there should be a clear path from that to those who produced the works, not those middle entities that profit from managing the works.

    Posted on June 18, 2009 - 01:54 PM #
  9. Here's an interesting article from the Beeb.

    http://news.bbc.co.uk/2/hi/uk_news/magazine/8106805.stm

    Of the four tools we have to regulate behavior, money, law, physics and norms, it looks as though norms will be getting a showing.

    They are gonna try the AM radio politics approach. (My apologies to the solid people on AM, who are NOT doing this!) That is just start blathering and entertaining compelling, if unproven or poorly supported views, that reinforce norms they prefer.

    Hey, it worked for Rush Limbaugh!

    And it starts with this article! (Which I think is funny in that a PR firm is writing about the value of using PR! Nice one guys!)

    They use the word theft in the article, when it's infringement. I always work to highlight this error because failing to use the right word, fails to convey the problem correctly, and that renders the discussion futile, for the most part.

    These clowns bonehead this right out of the gate. So much for potent PR.

    Theft absolutely requires a loss. That's the baseline element that defines theft as a crime. It's bad because the former owner doesn't have the property anymore.

    Infringement isn't theft, because infringement is the word we use when an owner is violated, but nothing is lost. The baseline element required for the crime of theft to be in play isn't on the table.

    Infringement means the owner still has their work, still has the opportunity to sell it and arguably might stand a better chance given the infringer has a quality sample under consideration or for recommendation, and still has their publishers rights.

    Theft is a different thing, defined by a loss.

    Piracy is all about making copies that infringe on the publishers right to regulate those copies.

    When we make files available that we don't hold the rights to, we may be infringing. This is actually quite likely, but not always likely. I might make a file available for me to pull down at work, for example. Usually, this is infringing, but when it isn't, it's likely to be fair.

    Big media doesn't want to talk about fair, just as much as they want to talk about theft and how bad that is. They hurt their cause with this because even fairly ordinary people are beginning to grok how this works and nobody respects manupulators once they know they've an agenda.

    IMHO, that agenda is control and pay for play. Control first, pay for play second, if possible.

    The ad being discussed as a demonstration piece ends with:

    "Downloading pirated films is stealing. Piracy. It's a crime."

    Is it so hard to just say, "Downloading pirated films is a crime." ?!? Or, "when you share movies without permission, it's piracy and piracy is a crime." ?!?

    We know it's a crime, the law is clear it's a crime, so let's talk about the actual crime instead of mangling it into some other crime that isn't really the real crime; namely, infringement.

    I think a big part of this happens to be that nobody likes thieves. --Even other thieves! It's a natural fit to make that false association and capture and potentially leverage all the anger over theft for the greater good. Problem is, there just isn't any theft!! The bottom will fall out of that one sooner or later, leaving the state of the discussion poor enough to be worthless.

    Seems to me we should be discussing infringement as a crime. To be fair to big media (and I'm very fair here), not all infringment is criminal. Until recently, it was a civil violation too, not criminal. I believe that changed, meaning people could be felons for playing a legally purchased media on a legally purchased player on Linux without permission to do so from the publisher / owner. That's hosed up bad law. Really bad law.

    Sometimes I think we are doomed on this matter because of this one failure to grok the difference between theft and infringement. Big media knows. Little media mostly knows. Ordinary people are learning. Most ordinary people also understand fair and equitable as concepts too. Concepts that are largely missing from this discussion. Desire for control lies at the root of that.

    These things are a big deal because it complicates matters and has already resulted in bad law.

    Bad law that everybody knows is bad usually ends up being mostly ineffective law, or at best selective enforcement kinds of laws that nobody respects and everybody tends to fear. Ineffective law doesn't regulate behavior, and could easily impair the use of the other three regulatory tools.

    When this all adds up, we've a mess and nobody is happy!

    Infringement. Say it. That is what the crime is. If we start there, we can begin to actually do some damage on this matter before we end up with too much bad law that will take generations to sort out, if ever.

    BTW, bad law is associated with another digital related crime called circumvention. This word has the same problem that infringement does. Analogies to breaking and entering abound and they are just as flawed as the theft analogies are with the law being poorly written as a result.

    We have the DMCA, which is an anti-circumvention law that has been abused sixteen ways to Sunday. Bad law, bad regulation = ugly and convoluted mess. It hobbles legit reverse engineering efforts, threatens expression of all kinds, threatens fair use rights, open code and a whole batch of other stuff. Is the basis for a lot of big corporate technology lock in too.

    For those seeking a market where they can profit from their works, having bad law mangle norms and ignore physics means money will not flow where it should and since money is what the artists want and big media control is what nobody but big media wants, we've all a very keen interest in keeping the discussion clear, both producers and consumers alike.

    If we don't take this interest seriously, those with the most gold will win out, meaning there just won't be an equitable opportunity for everyone to go and get after their share of the gold.

    I want my shot at the gold and I want others to have theirs. Won't happen unless we sort this stuff and start having real discussions about it all.

    Posted on June 19, 2009 - 11:20 PM #

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