>>Still Needed: A Functioning Digital Market

Still Needed: A Functioning Digital Market

Prof. Jane C. Ginsburg, Columbia University School of Law
October 16, 2013

Review of Robert Levine, Free Ride: How Digital Parasites Are Destroying the Culture Business, and How the Culture Business Can Fight Back (Doubleday 2011)

[Author’s note: Although Free Ride was published two years ago, the more recent Spanish edition, and a request to supply a book review for a journal in Argentina, furnish the occasion for this IP Issues column.]

Digital piracy now pervades every sector of authorial activity.  My own experience proves that freely available illegal copies do not scourge only the entertainment industry.  When I began teaching my Fall Semester Legal Methods (introduction to legal reasoning) course this year, I noticed images of my casebook on several students’ computer screens.  Perplexed, because I had not authorized an eBook edition of the casebook, I asked my publisher whether it had nonetheless produced an eBook version. The publisher, however, was as surprised as I was, and tracked down the (or an?) origin of the digital copies: an official-looking website (whose URL I won’t further disclose), on which each book (and there were many, including another of my casebooks, and many titles by my Columbia colleagues) for law school or other disciplines was listed on an individual page, with descriptions cut-and-pasted from the publishers’ catalogs, and a button emblazoned “click here for a free download.”

The website, obviously directed toward U.S. university students, purports to be a “sharing” site, and turns out to come from the Netherlands, beyond the reach of the U.S. copyright law.  Of course, all my publisher’s requests to remove the pirated books have gone unheeded.  And when the publisher attempted to post a comment on the site warning that the copies offered for download were illegal, the site administrator removed the notice.  (Thus demonstrating the site’s ability to remove unwanted content on its own; it just depends which content, and who doesn’t want it.)

I found this episode exceedingly annoying, but the loss of some portion of my meager royalties will compromise neither my material well-being, nor my ability to produce other tomes to inflict on law students, or other contributions (already low-value) to legal scholarship.  Law professors can afford to be altruistic.  So it’s not surprising that so many of them eagerly militate for the purveyors of “free culture.”  Their impetus to give their works away is entirely laudable.  Praiseworthiness pauses, however, at the concomitant campaign to give other authors’ works away.

The impact of “sharing” sites and similar parasitic enterprises on authors who create works for a living, and thus on the future of creativity, preoccupies Robert Levine.  In Free Ride: How Digital Parasites Are Destroying the Culture Business, and How the Culture Business Can Fight Back, he swims against the tide of “information wants to be free” (all too-popular in the popular press) to reveal the business interests that benefit from the liberation of content.  As Levine puts it: “In Silicon Valley, the information that wants to be free is almost always the information that belongs to someone else.”  Levine urges effective copyright protection not only for the benefit of authors and copyright holders, but for the sake of our future culture.  Unauthorized copying and communication of works may gratify consumers in the short run, but, Levine predicts, “[b]y making it essentially optional to pay for content, piracy has set the price of digital goods at zero.  The result is a race to the bottom, and the inevitable response of media companies has been cuts, first in staff, then in ambition, and finally in quality.”

Levine’s book is all the more refreshing, and all the more needed, in light of the SOPA-PIPA debacle in the U.S. Congress, and the ACTA circus in the E.U. Parliament, both unhappy events postdating Free Ride’s original English-language publication.  It would not be overly harsh to observe that, at least in the United States, much of the press coverage of the bills pending in Congress was entirely supine.  Rather than reading the (admittedly long and tortured) text of the bills, many reporters who contacted me admitted that they sought the sound bite, the quotable quote.  Thus, instead of critically examining the claims of proponents and opponents of the legislation, much of the press simply played into the hands of the demagogues, who proved both more numerous and more spin-adept among the opponents.  Those bills would have provided a remedy against off-shore pirate websites who target U.S. users (like the site that is “sharing” my books); instead, my publisher and countless other publishers and authors incur frustration and diminishing revenues, a sorry portent for the future production of professional works of authorship.

I emphasize “professional” because the authors and publishers and producers whose livelihoods and business models copyright undergirds are the species Robert Levine perceives to be endangered by the rise of “parasitic” Internet enterprises, such as Google, YouTube, music file-sharing sites, and any other ventures that depend on, but do not pay for, copyrighted content.  Many of the book’s chapters examine how the Internet has affected various sectors of creative activity – music, books, journalism, television, film.  The intervening two years have not borne out all Levine’s dire forecasts; for example, the arrival of lawful music streaming services such as Spotify and Pandora appear finally to have staunched the flow of losses.  That said, just barely making it out of the red furnishes dim cause for celebration, especially since the remuneration authors have so far received is very modest.

The first and third chapters of the book set the legal framework, both the genesis of the 1998 Digital Millennium Copyright Act (which, albeit intended to adapt copyright to meet the challenges of the digital age, in fact supplied the play-book for many of the parasitic ventures Levine deplores) and current lobbying to diminish copyright even further.  Levine disabuses his readers of the disinterested character of many academic and public policy advocates’ law reform efforts: Technology companies, especially Google or its officers, substantially underwrite their challenges to copyright protection.

Levine also confronts what one might call the Romanticism of user-generated content.  Now that it is so easy to self-publish, who needs publishers (or record companies, or film producers…)?  Once the bricks-and-mortar and hardcopy production and distribution costs vanish, all that’s left is the intellectual content, and lots of people create for love, not money.  Even those who want to be paid can charge their users directly.  In a world of pervasive dissemination (if dubious remuneration), the distribution intermediaries are doomed dodos.  Levine details the fallacies of this sort of vision: Producing and distributing physical copies account for very little of what publishers do.  They add value in selecting, editing (well, maybe), and marketing books – not all of which efforts are best suited to authors.  Arguably, authors could outsource these tasks, though following up on how their delegates perform them may unduly distract authors from the real work of writing.  The same observation applies to other forms of remuneration, such as fees from speaking tours, which used to be an accessory to royalty income, and now are expected by some to replace it.

Levine may make the strongest case for publishers (and their equivalents outside the book sector) when he emphasizes the up-front costs that publishers assume.  That is, the advance the publisher pays the author enables the author to live while spending the sometimes considerable time needed to research and write the book.  One might rejoin that the Internet supplies an alternative even to advances, through audience appeals such as Kickstarter.  But, in addition to taking time away from authorship – these campaigns tend to require constant cheerleading in the form of frequent mendicant bulletins by their beneficiaries – the hat-in-hand system risks saturation.  It is one thing for the occasional book, CD, or audiovisual work to obtain funding in this way; if every literary or artistic creation required its own fundraiser it is not at all clear that we would systematically provide most authors with a means of survival during the period of their works’ gestation.  That is why Rob Levine has an ally in Lord Macaulay (whom copyright detractors like to quote for having pronounced copyright “exceedingly bad”), who in 1841 (in the same speech) recognized – presciently, in light of today’s acolytes of amateur authorship – that:

The advantages arising from a system of copyright are obvious.  It is desirable that we should have a supply of good books; we cannot have such a supply unless men of letters are liberally remunerated; and the least objectionable way of remunerating them is by means of copyright.  You cannot depend for literary instruction and amusement on the leisure of men occupied in the pursuits of active life.  Such men may occasionally produce compositions of great merit.  But you must not look to such men for works which require deep meditation and long research.  Works of that kind you can expect only from persons who make literature the business of their lives. …  Such men must be remunerated for their literary labour….

Bad as things are, Free Ride is not unremittingly bleak.  The last chapters offer comparisons, prescriptions, and predictions.  By way of comparison, Levine looks to the European Union, where despite the persistence of piracy – Levine details the rise of the Pirate Bay – many national governments and courts have been less apt to laisser Google faire.  On the prescriptive side, Levine favors “blanket licensing” of content to Internet service providers, who would charge an additional fee per month to their Internet access subscribers.  The revenue would be distributed by collecting societies (such as ASCAP and BMI) to their members.  Levine recognizes, however, the great difficulty in getting copyright owners to participate, particularly in a copyright market in which (largely for antitrust reasons) collecting societies play a far smaller role than in the European Union.  Moreover, blanket licensing may look like a good idea when there is no cost-effective way to license on a more individualized basis.  As digital exploitation moves from mass copying (e.g., file-sharing) to providing access to works of authorship, the possibilities for controlling, and charging for, access may offer better prospects for successful web-based business models.

Finally, looking to the future, Levine suggests that, notwithstanding the seductive rhetoric of the “open” Internet, closed platforms such as iTunes may provide a more hospitable environment for legitimate commerce in works of authorship.  Levine also emphasizes the importance of effective national and international enforcement of copyright, and points hopefully (we now read wistfully) to legislative efforts which, after the book’s publication, degenerated into the worst public policy rout copyright has yet suffered.  Even so, Levine embraces the “wonders” the Internet has brought forth, all the while acknowledging the paradox: “It’s never been easier to distribute creative work.  At the same time, it’s never been harder to get paid for it.”  Levine is passionate about the need to develop a functioning digital market not only so that creators can get paid, but also so that the Internet can “live up to its potential” both to deliver, and more importantly, to foster, quality creations.

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