How to protect IP

The Washington Post editorial board favors legislation to protect copyright holders from infringement online. Here’s how the Protect IP Act would work:

The proposal would allow the Justice Department or a private rights holder to move against a rogue foreign Web site by convincing a federal judge that the site is “dedicated to” and has “no significant use” other than copyright or trademark infringement. Defendant Web sites would have the right to contest the allegation. An otherwise legitimate site that may have sold a product that turned out to be a fake or unknowingly linked to or posted an item to which it did not have the rights would be spared legal action.

Putting aside the overall desirability of the bill – I’d have to learn more – what would the impact be on copyright holders? Would their position be strengthened? That’s the assumption, and certainly the conventional wisdom. But I can imagine (fantasize?) about a different result.

Say tomorrow downloading or streaming movies or music illegally was impossible. What would the impact be? Would a generation raised on free access to culture throw up its hands and start paying? Or would those artists, creators, labels, studios, etc. who made their content freely available legally gain an advantage? You could imagine shows that could be streamed for free online starting to beat out those that couldn’t, once illegal downloads went away. Or music licensed under Creative Commons finally enjoying significant economic advantage over that which had to be purchased.

You can tell yourself a story about either open licensing or at least legal streaming offering greater not less competitive advantage in this environment. I find it easier to imagine in music, personally, because it’s more difficult to imagine a unified stance against free distribution. Sure, maybe you could get 95% of TV shows behind paid gates. Ditto movies. But does anyone think that’s how it’d go with music? Artists and labels would put their music out for free (either open licenses or legal streaming) in order to gain advantage against more popular artists. And in that way, perfect legal control of illegal copying could theoretically be a boon to those favoring free (as in beer or speech) access to culture.

None of this may be likely, and the kind of perfect control required is pretty spooky. But I find it to be an interesting thought experiment.

NPR on patent trolls

A friend asked for my thoughts on NPR’s piece from a few weeks back on “patent trolls.” Whereas, I am fairly confident about my views on copyright, I’m much less so with respect to patents. But hopefully my response below represents at least a decent starting point for thinking about their efficacy. What follows is my email response to my friend, lightly edited, mostly to add capital letters….

The piece fit pretty well w/ what i’ve seen elsewhere and it’s specifically about software patents. a couple quick things:

1) The point of patents are to incentivize innovation. That’s it. Not to grant people rights to their god given property or whatever. It’s a consequentialist framework.

2) Best I can tell there is near consensus in the software and computer science worlds that software patents are a bad idea. I base that on references I’ve read elsewhere, what’s said in the piece itself, conversations I’ve had with programmers and a talk I went to earlier in the year by a notable comp scientist.

3) It’s completely possible that software patents make no sense but that other areas of patent law are either working well or even are not strong enough. While I think the case for shortening copyright terms is 100% airtight, I don’t pretend to have a view about, say, pharmaceutical patents. Software, though, seems much clearer.

Now to look at the best argument presented in favor of today’s crazy software patent setup, from the NPR piece:

IV, for its part, says its job is to encourage invention, not to bring products to market.

Imagine an inventor out there — someone with a brilliant idea, a breakthrough. This inventor has a patent, but companies are stealing his idea. And this inventor doesn’t have the money or legal savvy to stop them. That’s where IV comes in. It buys this inventor’s patent, and it makes sure that companies who are using the idea pay for it.

(IV = intellectual ventures, a “patent troll”)

So this seems pretty sympathetic right? If not for this, lone inventors couldn’t reap the rewards of their creations. They’d be stolen by big companies. So there are 2 lines of attack against this i think.

a) The piece points out this isn’t realy how it works. This is a shady business for big money based a lot around big companies vying against each other, not about protecting small guys

b) Even if it were like that, we have to go back to the purpose of patents. The purpose of patents is to get innovation. So if a guy invents something and a company steals it, is that bad? Only if no one was going to invent it otherwise. if, absent the incentive, that innovation is never brought into the world.

That sounds harsh, and even i dislike he idea of someone else making money off another person’s idea. But we have to respect the point of intellectual property, which is incentives.

And just as importantly, the above fake scenario preys on our leaning to prize “invention” and “ideas” and undervalue execution. Talk to any investor or entrepreneur and they will tell you that it’s execution that makes a successful product. So when we bemoan the guy who didn’t get paid for an “invention” we miss a lot of the value add. To create a new thing takes more than an idea. Whether the idea itself should be given protection under IP needs to be based on the consequentialist view described above.

I have a whole other set of thoughts on the idea vs. execution thing, and what i described to you is the mainstream entrepreneurial view, NOT my own view (though my own view also places relatively less value on initial ideas or “inventions”) but that’s a separate topic.

TV vs. internet

I didn’t bother to write anything on Neal Gabler’s vacuous piece in NYT’s Sunday Review on how the internet has somehow killed big ideas. Luckily others came up with worthwhile responses. I confess, I’m tired of responding to evidence-free anti-internet screeds (see here, here.) But Kevin Drum’s response had an interesting tidbit:

Honestly, I think I liked this genre better back when people blamed TV for the decline and fall of American youth. I always thought the anti-TV crowd at least had a point: television really did crowd out things like books and magazines, which were better suited to big ideas and complex arguments than the tube. But social networking? As near as I can tell, it’s mostly crowding out in-person gossip and….television. That seems like a much more benign trade.

Were anti-TV advocates as misguided and ill-informed as anti-internet commentators? I tend to agree with Drum that there’s a difference, and hold up the Net’s crowding out of TV as a benefit. But it’s an interesting comparison.

What makes a great Washington scoop?

We know our political journalism is deeply, deeply messed up. But Politico is taking process coverage to a new level with its coverage of its coverage of Biden calling Republican debt negotiators terrorists. I get that it’s defending itself against other outlets questioning sources, something any publication would do. But how self-satisfied is this?

All told, this was exactly what makes a great Washington scoop: It was an exclusive report that drove the political conversation — and continues to do so — on a major issue. The fact that we’re still talking about it, Obama is still being asked about it and The Washington Post is still fact-checking this 16 days later shows the story still has legs.

Whether or not Biden used the term “terrorist” in describing Republicans’ negotiating tactics – a matter of precisely zero substance – is, apparently, a “major issue.” That we’re still talking about it is depressing.

Was I wrong about the NYT paywall?

In a nutshell: not yet.

I wrote a post for The Atlantic back in March when the paywall first launched that called it “unsustainable.” And yet, as Felix Salmon has detailed here and here, the paper is on track to hit its goal of 300,000 digital subscribers. Was I wrong? I don’t think so; at least not yet.

A bit more from about NYT’s success, from NYMag:

It will take years for the ultimate wisdom of the Times’ strategy to be apparent, but the company’s second-quarter-earnings report proves that its digital-subscription plan has thus far been an enormous success. The internal projections have been closely held, but several people have confirmed that the goal was to amass 300,000 online subscribers within a year of launch. On Thursday, the company announced that after just four months, 224,000 users were paying for access to the paper’s website.

As Felix notes, that revenue is a drop in the bucket, but still promising. So here’s what I wrote when the paywall launched:

I wouldn’t be surprised if the NYT can raise some revenue from this in the short term from people young enough to have canceled their paper subscription but not so young to be heavily into social media, at least as a means of getting news. (Age isn’t the only relevant factor here, but it’s one.) But that already limited demographic will shrink over time. Put another way: the number of users interested in NYT content but not already reliant on social media — or even just capable of using it — to access news is shrinking and will continue to do so.

In other words, NYT was leaving some money on the table and they decided to pick it up. But I’m skeptical that they can grow digital subscriptions over time. Eventually, I’d expect the pool of digital subscribers to shrink. But Felix has some good pushback on that kind of logic:

Sales people and business-side executives tend to believe as a matter of faith that if people can get something for free, they won’t pay for it. But all they need to do is look at their own behavior to see how that isn’t true: when they go to a restaurant in a distant town that they’ll never visit again, they still leave a 20% tip. A large segment of the population feels that it’s only proper to pay for something if you’re getting value from it…

I had a couple brief online conversations after I posted a quick screed against record companies that suggested paying for music may not be necessary, and based on those conversations Felix is, at minimum, partially right. At least when people are used to paying for something, they feel obligated to keep paying for it. Multiple people spoke to me about how important it was to pay for music in order to support the artist, etc.

But is this true in some absolute sense? That it’s getting value that prompts people to pay? More likely it’s being accustomed to paying for something that gives you value. Which is to say I expect that a generation that grew up never paying for information won’t feel compelled to pay for news.

NYT ignores draconian copyright terms

The New York Times had a lengthy piece on a legal battle between musical artists and the recording industry. Here’s the lede:

When copyright law was revised in the mid-1970s, musicians, like creators of other works of art, were granted “termination rights,” which allow them to regain control of their work after 35 years, so long as they apply at least two years in advance. Recordings from 1978 are the first to fall under the purview of the law, but in a matter of months, hits from 1979, like “The Long Run” by the Eagles and “Bad Girls” by Donna Summer, will be in the same situation — and then, as the calendar advances, every other master recording once it reaches the 35-year mark.

The record companies object, and there seems to be a legal battle shaping up. But nowhere in the article is there any mention of the fact that no one should own these recordings after 35 years!

My brother, a law student, pointed out to me that mine is a normative claim, whereas the article centers around a legal battle. True. But it’s more than that. By the criteria the Constitution sets out for intellectual property, today’s excessive terms clearly fail. The purpose, laid out in the copyright clause, is:

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.

I can’t say it any simpler than this: no one seriously thinks today’s copyright terms are maximizing the creation of art and culture. It’s blatantly obvious that terms could be significantly shorter without any loss in terms of creation. So by the the criteria set out in the constitution, the battle NYT describes is a sideshow; the real story is that copyright terms are out of control.

All I’m asking for is a brief mention. The artists’ “side” is represented, as is the record companies’. What’s missing? The public’s side. This is the tragedy of what political scientists refer to as concentrated benefits/distributed costs. Artists and record companies each gain dramatically from excessive copyright protection. The public loses out, but each individual loses only a little bit, so it’s hard to organize politically to institute more sane policies. That explains the politics of copyright, but one would hope the NYT would go out of its way to give voice to public interest arguments.