In 1985, the Supreme Court said, “The fair use doctrine is not a license for corporate theft, empowering a court to ignore a copyright whenever it determines the underlying work contains material of possible public importance.”1 Last week, a court held to the contrary.

In a September 9th order, the Southern District Court of New York granted summary judgment in favor of TVEyes, a media monitoring company, on the issue of fair use. Fox News Network had filed a lawsuit against TVEyes for recording its station continuously and creating a searchable database out of its content and the content of 1,400 other television and radio stations.

Like other media monitoring services, TVEyes allows subscribers to track news coverage of particular events or issues. The service begins at $500 month; in 2013 the company had revenues of $8 million, with over 2,200 subscribers. Fox News Network owns and operates Fox News Channel and Fox Business Network, delivering twenty-four hour news and business coverage. It also actively licenses video clips to third parties. Fox News asked the court to order TVEyes to stop using Fox content without permission for its service, and both parties moved for summary judgment. In last week’s order, the court only addressed the copying and distribution of Fox News clips to TVEyes subscribers — the service also allows subscribers to “save, archive, download, email, and share clips,” features that the court needs more evidence to rule on.

But in finding this wholesale, commercial copying to be fair use, the decision stands as an example of just how dramatically — and fundamentally — the fair use doctrine has been transformed in just a few decades. What was once a bounded exception allowing reasonable use of copyrighted works when necessary for specific purposes has become a broad and sweeping mechanism that allows courts to seemingly ignore copyright at their own discretion.

Transformative Use

The modern conception of “fair use” — an independent, affirmative defense against copyright infringement that takes into account a number of factors such as the purpose of the use — does not seem to have consistently established itself in US courts until the mid-1950s. This was also the same time that the Copyright Office released a study on fair use as part of the revision process that would eventually result in the 1976 Copyright Act. The 76 Act marked the first statutory reference to fair use. Section 107 of the Act reads:

Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include—

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.

The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.

But perhaps just as important to the development of the fair use doctrine is a 1990 law review article by federal judge Pierre Leval, Toward a Fair Use Standard. The prescriptive essay argued that the “heart” of the fair use inquiry was the first factor, the purpose and character of the use, and that the answer to the inquiry lied in determining whether the challenged use is “transformative.” Leval wrote:

The use must be productive and must employ the quoted matter in a different manner or for a different purpose from the original. A quotation of copyrighted material that merely repackages or republishes the original is unlikely to pass the test; in Justice Story’s words, it would merely “supersede the objects” of the original. If, on the other hand, the secondary use adds value to the original–if the quoted matter is used as raw material, transformed in the creation of new information, new aesthetics, new insights and understandings– this is the very type of activity that the fair use doctrine intends to protect for the enrichment of society.

Four years later, the Supreme Court referenced Leval’s “transformative” framing, and lower courts have followed its lead since.2 But regardless of how descriptively accurate this framing might be, the TVEyes decision demonstrates its shortcomings as an actual standard.

For one, it is ill-defined, an incoherence revealed by the TVEyes court at the outset. The court begins its discussion by stating that “Transformation almost always occurs when the new work ‘does something more than repackage or republish the original copyrighted work.’” But that sentence is immediately followed by this one: “A use ‘can be transformative in function or purpose without altering or actually adding to the original work.’” Perhaps these two seemingly contradictory statements — both from Second Circuit decisions from the past year — can be reconciled, but the court spends no time doing so. Instead, it offers the following conclusory analysis:

Unlike the indexing and excerpting of news articles, where the printed word conveys the same meaning no matter the forum or medium in which it is viewed, the service provided by TVEyes is transformative. By indexing and excerpting all content appearing in television, every hour of the day and every day of the week, month, and year, TVEyes provides a service that no content provider provides. Subscribers to TVEyes gain access, not only to the news that is presented, but to the presentations themselves, as colored, processed, and criticized by commentators, and as abridged, modified, and enlarged by news broadcasts.

In other words, “the use is transformative because TVEyes copied the entire work verbatim, and don’t worry if that is indistinguishable from the definition for infringement.” The court does little to shed more light on its reasoning when it later endorses TVEyes’ assertion that “monitoring television is simply not the same as watching it.” Along the same lines, I suppose you could argue that it’s fair use to copy reality television shows so long as you watch them ironically.

Fortunately, less than a day ago, the Seventh Circuit explicitly rejected the transformative use test, noting that “To say a new use transforms a work is precisely to say that it is derivative and thus, one might suppose, protected under §106(2).”3 Instead, said the court, “We think it best to stick with the statutory list…”

Commerciality

Another dramatic turn in fair use doctrine is seen in the treatment of “commerciality” in the first factor. Traditionally, courts have given wider berth to scholarly and non-profit users of copyrighted works. In its 1984 Betamax decision, the Supreme Court observed that every commercial use of copyrighted material is presumptively unfair. However, a decade later, the Court would retreat from that holding and remove the presumption. In Campbell, the Court explained that, “If, indeed, commerciality carried presumptive force against a finding of fairness, the presumption would swallow nearly all of the illustrative uses listed in the preamble paragraph of § 107, including news reporting, comment, criticism, teaching, scholarship, and research, since these activities ‘are generally conducted for profit in this country.’” Instead, the Court adopted a sliding scale approach, where commerciality should be treated as merely “a fact to be ‘weighed along with other[s] in fair use decisions.’” Nowadays, commerciality has little, if any, role in the fair use doctrine.4

TVEyes continues this trend. The court does note that “Clearly, TVEyes is a for-profit company, and enjoys revenue and income from the service it provides.” But it follows this with a recitation of the above language from Campbell without a word more.

Amount and Substantiality Used

The implementation of the third fair use factor, which looks at “the amount and substantiality of the portion used in relation to the copyrighted work as a whole” has also noticeably shifted in recent decades. In fact, until Betamax, it was virtually axiomatic that copying an entire work could never be fair use.5 But Betamax held, in part, that home taping of broadcast television by VCR owners was a fair use, despite the fact that exact duplicates of complete works were being made. This holding drew a sharp rebuke from the four Justices on the dissent, who said, “Fair use is intended to allow individuals engaged in productive uses to copy small portions of original works that will facilitate their own productive endeavors. Time-shifting bears no resemblance to such activity, and the complete duplication that it involves might alone be sufficient to preclude a finding of fair use. It is little wonder that the Court has chosen to ignore this statutory factor.”

Since then, the floodgates have been opened. Last year, for example, the Southern District Court of New York held that the wholesale copying of twenty million books (by a for-profit corporation) was a fair use.6

In TVEyes, the departure from third factor tradition is even more striking. Not only is TVEyes copying entire works, it’s copying entire stations. There is nothing Fox News airs that TVEyes doesn’t copy. Yet, not only does the court not consider this a negative that might otherwise be outweighed by the other three factors, it suggests that this factor favors TVEyes. Said the court, “One cannot say that TVEyes copies more than is necessary to its transformative purpose for, if TVEyes were to copy less, the reliability of its all-inclusive service would be compromised.” Or, you can copy everything if your purpose is to copy everything.

Public Benefit

The final area of fair use transformation is seen in the court’s consideration of the fourth factor, “the effect of the use upon the potential market for or value of the copyrighted work.” The court here says, “The fourth factor requires a balance between the ‘benefit the public will derive if the use is permitted, and the personal gain the copyright owner will receive if the use is denied,’” (emphasis added) citing to the Second Circuit’s 2006 decision in Bill Graham Archives v. Dorling Kindersley L’td. Since that language appears nowhere in the statute, it’s worth taking a closer look at where it came from. Bill Graham itself cites an earlier Second Circuit decision: MCA, Inc. v. Wilson. There, the court said of the fourth factor, “where a claim of fair use is made, a balance must sometimes be struck between the benefit the public will derive if the use is permitted and the personal gain the copyright owner will receive if the use is denied.” (Emphasis added). So already we’ve made the jump from a balance that “must sometimes be struck” to an absolute requirement. But if we look even closer, we see that the cases MCA cites to support its proposition are not discussing the fourth fair use factor specifically but fair use in general. This makes sense, since fair use is a doctrine where courts strike a balance between public and private interests. But somewhere along the lines, the Second Circuit duplicated this principle into the fourth fair use factor.

Leaving the doctrinal history aside, TVEye‘s discussion of the public benefit leaves much to be desired (never mind the fact that the service is, as noted by the court, not available to the general public). It essentially boils down to this: TVEye offers a useful service. Of course, most businesses offer useful services; otherwise, they wouldn’t remain in business long. And the operation of business does benefit the public in the broadest sense. But this definition of the public benefit if too wide to be of much use here — and, more importantly, it doesn’t explain why a for-profit business that provides a service involving the regular copying of copyrighted works should be privileged under the law from licensing those works. Maybe I’m old-fashioned, but I don’t think asking a business to pay its suppliers is unfair.

And the Supreme Court would agree, at least thirty years ago. After its line about fair use and corporate theft, quoted at the beginning of this article, the Court in Harper & Row continued:

In our haste to disseminate news, it should not be forgotten that the Framers intended copyright itself to be the engine of free expression. By establishing a marketable right to the use of one’s expression, copyright supplies the economic incentive to create and disseminate ideas.

***

It is fundamentally at odds with the scheme of copyright to accord lesser rights in those works that are of greatest importance to the public. Such a notion ignores the major premise of copyright and injures author and public alike. “[T]o propose that fair use be imposed whenever the `social value [of dissemination] . . . outweighs any detriment to the artist,’ would be to propose depriving copyright owners of their right in the property precisely when they encounter those users who could afford to pay for it.”

Footnotes

  1. Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 US 539, 558, quoting Iowa State University Research Foundation, Inc. v. American Broadcasting Cos., Inc., 621 F. 2d 57, 61 (1980). []
  2. Campbell v. Acuff-Rose Music, Inc., 510 US 569, 579 (1994). []
  3. Kienitz v. Sconnie Nation, No. 13-3004 (7th Cir. 2014). The court characterized the discussion of transformative use in Campbell as a “suggestion.” []
  4. See Matthew Sag, Predicting Fair Use, 72 Ohio State Law Journal 47, 77 (2012) (finding commercial use as a factor insignificant in a study of 280 fair use decisions from 1978-2011); Barton Beebe, An Empirical Study of U.S. Copyright Fair Use Opinions, 1978–2005, 156 U. PA. L. Rev. 549 (2008) (finding commerciality has no significant impact on case outcomes in study of 306 fair use decisions from 1978-2005). []
  5. See Williams & Wilkins Company v. United States, 487 F. 2d 1345, 1366 (Ct of Claims 1973); Public Affairs Associates, Inc. v. Rickover, 284 F.2d 262, 272 (DC Cir. 1960); Benny v. Loew’s Inc., 239 F.2d 532, 536 (9th Cir.1956); Leon v. Pacific Telephone & Telegraph Co., 91 F.2d 484, 486 (9th Cir.1937) (“Counsel have not disclosed a single authority, nor have we been able to find one, which lends any support to the proposition that wholesale copying and publication of copyrighted material can ever be fair use.”). []
  6. Authors Guild, Inc. v. Google Inc., 954 F. Supp. 2d 282 (SDNY 2013). Though, to be fair, the court did note that the third factor weighed “slightly against” a finding of fair use. []

Monkey Selfies & Animal Artists — An interesting take on the frequently discussed monkey selfie from a philosophical perspective.

Yes, Internet TV is near, but there’s too much money in cable to go there — “‘What is the appropriate way to market your product? Is it good to go directly to the consumer? Is it appropriate to be streaming? What is the future, how do we grow these businesses?’ Moonves asked. ‘I don’t think there is a media guy you’ve got up here that isn’t involved every week’ in those discussions.”

The concept of parody and the legitimate interests of parodists and copyright holders — Kluwer Copyright Blog examines a recent CJEU decision concerning parody.

D.C. door swinging Google’s way — It may soon be the case that the best way to get into government work is to start at Google. And vice versa.

Google Is Target of European Backlash on U.S. Tech Dominance — “Accusations are mounting that Google unfairly exploits its dominant position in search, giving a competitive edge to its growing stable of businesses, like YouTube videos, its Google Play app store and its news alerts.”

LouFest 2014: Cake’s John McCrea Talks Follow-Up To ‘Showroom of Compassion,’ Disdain For Tech Companies, State Of Music Industry, And More (via Trichordist) — McCrea: “And there are people, mostly in the tech industry, who say, ‘Oh, music shouldn’t be a job, you should have a day job and then play music on the side.’ But most day jobs don’t allow you to go on tour. So that’s why friends of ours have quit because you can’t just take off from your day job and go on tour for a month. There is a choice. So I see it as rather disingenuous of an industry that is actually monetizing our work and making really good money off it but not even thinking to share that money with artists to tell us that we can’t have a professional career. It is kind of selfish and sh*tty.”

The Classical Cloud (via CultureCrash) — “If I were a music-obsessed teen-ager today, I would probably be revelling in this endless feast, and dismissing the complaints of curmudgeons. No longer would I need to prop a tape recorder next to a transistor radio in order to capture Bruckner’s Sixth Symphony. The thousand-year history of classical music would be mine for the taking. But there is a downside to the glut of virtual product and the attendant plunge of prices. As the composer-arranger Van Dyke Parks has argued, in a recent essay for The Daily Beast, the streaming model favors superstars and conglomerates over workaday musicians and indie outfits. Its façade of infinite variety notwithstanding, it meshes neatly with the winner-take-all economy. And if it ever comes crashing down—streaming services have struggled to turn a profit—hoarding may return to fashion.”

On Scalia’s Aereo Dissent — Devlin Hartline takes a closer look at the dissent from this summer’s Aereo decision and finds it lacking, primarily because it applies case law concerning the reproduction right to a question involving the public performance right.

Book Excerpt: “Showrunners: The Art of Running a TV Show” — Very interesting look behind the scenes of television production. The book combines an informative look at the art of creating and running a TV show with interviews with showrunners from popular shows.

Google Accord With Harvard Tie Fails Judge’s Smell Test — Another cy pres settlement rejected because money from Google would be funded to institutions it enjoys close relationships with. For an in-depth look at this topic, be sure to read Google and Facebook’s new tactic in the tech wars.

More on How a Fox News Lawsuit Might Impact the Future of News — This week, summary judgment motions from parties became publicly available. The lawsuit pits Fox News against media monitoring service TVEyes, with the former alleging the latter runs a commercial service reproducing and distributing copyrighted content without permission. TVEyes is asserting a fair use defense.

Getty Images sues Microsoft over new online photo tool — “In effect, defendant has turned the entirety of the world’s online images into little more than a vast, unlicensed ‘clip art’ collection for the benefit of those website publishers who implement the Bing Image Widget, all without seeking permission from the owners of copyrights in those images,” said Getty.

Intellectual property and economic prosperity: Friends or foes? — Mark Schultz and Adam Mossoff: “Looking at the bigger picture, the broad sweep of economic history indicates that when it comes to economic prosperity and innovation, the U.S. and a few other nations have been doing something right for the past two centuries. The U.S. and Great Britain led the world into unprecedented prosperity and development through the Industrial Revolution, and the U.S. remains responsible for a vast amount of the innovation and creativity driving global prosperity – from the world’s most successful creative industries to smartphones to life-saving drugs.”

Behind the Best Pictures From Ferguson, With Getty Photographer Scott Olson — Olson, who was briefly arrested while covering the protests in Ferguson, Missouri, talks to New York Magazine about some of the popular and powerful photographs he has so far captured.

How Social Media Silences Debate — The New York Times points to a study that finds that people are less likely to express dissent on issues online than they are in person, contrary to what some had predicted.

Meet The Publisher Who Ditched Amazon And Is Selling More Books Than Ever — “In a turn of events that might offer some solace to other publishers, White recently announced that EDC has not only survived the leap into the unknown but just had its best year ever in net revenues. July sales were up 28% over the same month last year, and first-quarter revenues came in 20% higher than 2013’s numbers.”

How do writers find their voices? — Interesting preliminary results from a survey of writers. “One particularly startling finding has been that many writers are unable to ‘see’ the faces of their protagonists. The main character often registers as a blank – or, in one case, pixelated like a censored photograph.”

Last week, the US Copyright Office released the third edition of its Copyright Compendium. This edition was long awaited – the second edition was released in 1984. The Copyright Compendium details internal regulations concerning how the Copyright Office determines whether an application can be registered or not. In the US, works are protected by copyright the moment they are fixed in a tangible format, however, registration does provide certain benefits. It is required before a civil lawsuit for infringement is filed, for example.

Almost immediately, a number of news outlets zeroed in on one sentence within the 1,222 pages of the Compendium. “The Office will not register works produced by nature, animals, or plants,” says the Compendium. This includes, “A photograph taken by a monkey.” This led to what the internet does best: a viral story about nothing of particular consequence.

The Internet took this sentence as a reference to a certain monkey photograph. To recap: in 2011, a British photographer, David Slater, traveled to Indonesia to photograph black macaques. As he was there, one female macaque grabbed his camera and happened to trigger the camera, taking a series of photos. Upon retrieving the camera, Slater found that several of the photos were quite remarkable and published them, leading to a fair amount of fame.

One of the photos was uploaded to Wikipedia without Slater’s permission. Slater requested removal of the photo, but Wikipedia editors refused, coming to the factual conclusion that the macaque, not Slater, was the sole author of the photograph, thus placing it in the public domain.

The internet exploded with a wealth of discussion about monkey selfies and copyright. Some of it was even worth reading.

Just as things began to calm down, the US Copyright Office announced the third edition of the Copyright Compendium, containing its reference to a photograph taken by a monkey. This led to the most recent burst of news, some of it suggesting that “the government” has “settled” the issue.

Comprehending the Compendium

This is not so for a number of reasons.

First, even if the Copyright Compendium is making a definitive statement about the copyrightability (or not) of the monkey selfie, such a statement is not binding as law. The Compendium itself points this out, saying, “The policies and practices set forth in the Compendium do not in themselves have the force and effect of law and are not binding upon the Register of Copyrights or U.S. Copyright Office staff.”  It should also be noted that a decision by the Register of Copyrights to deny a copyright registration is not dispositive of the ultimate question of copyrightability.1

Second, the statement that “The Office will not register works produced by … animals” is not novel nor surprising. But to say that this settles the question of this particular photograph, as many stories in the past week seem to suggest, begs the question that the monkey is the sole author of the photo.

Third, there is no reason why this question would be answered by US law. Copyrightability is most likely “determined by the law of the state with ‘the most significant relationship’ to the property and the parties”,2 which would clearly not be the US under the facts here: Slater is British, and the photo was taken in Indonesia.

Authorship and photographs

But let’s pretend US law would apply.

The Copyright Act has little to say about authorship. 17 USC § 102(a) says that “Copyright protection subsists, in accordance with this title, in original works of authorship fixed in any tangible medium of expression”, and § 201 says, “Copyright in a work protected under this title vests initially in the author or authors of the work”, but these terms – “works of authorship” and “author” are not defined anywhere within the Act.

The Supreme Court, however, has defined “author,” and it has done so, coincidentally, in a decision establishing that photographs can be protected by copyright in the first instance. In Burrow-Giles Lithographic Co. v. Sarony, the Court said that an “author” is defined as “he to whom anything owes its origin; originator; maker.”3 Over a century later, the Court would expand on this idea of the author as originator. “The sine qua non of copyright is originality. To qualify for copyright protection, a work must be original to the author. Original, as the term is used in copyright, means only that the work was independently created by the author (as opposed to copied from other works), and that it possesses at least some minimal degree of creativity.”4

So authorship requires two things: absence of copying and a modicum of creativity.

With this in mind, there are at least three possibilities concerning the authorship of this photo: 1) The monkey is the sole author, 2) Slater is the sole author, or 3) the monkey and Slater are joint authors.

We can quickly dismiss the last possibility. Joint authorship requires, in part, that “each of the authors prepared his or her contribution with the knowledge and intention that it would be merged with the contributions of other authors as ‘inseparable or interdependent parts of a unitary whole.’”5 The claim that a monkey could do such a thing is even more extraordinary than a claim that animals have knowledge or intent in the first place.

In the case of the monkey as author, the sole act involved is the pushing of the button that triggered the camera and resulted in the shot. This act is certainly necessary to the creation of the photo, but I am not convinced that it is sufficient to establish the monkey as an author. The monkey possesses no knowledge of the nature of the camera, nor knows that pushing the button would result in the creation of a photograph. While copyright law is silent on what, if any, knowledge or intent is required for authorship, surely there must be some level needed to distinguish what the monkey did here from any other force of nature or deus ex machina that could cause the creation of a photograph. The intuition is that there is something specifically human required under copyright law for authorship.

Slater, on the other hand, did everything but push the button. He chose the location, camera, film, and time of day. He set it all up with the intention to create photographs. He processed and developed the resulting photos. The photos would not exist but for these conscious acts.

Courts have found similar acts sufficient for copyrightability. The Southern District Court of New York said the following in 1968 when it was confronted with alleged copying of the Zapruder Film by Life Magazine:

Any photograph reflects “the personal influence of the author, and no two will be absolutely alike”, to use the words of Judge Learned Hand.

The Zapruder pictures in fact have many elements of creativity. Among other things, Zapruder selected the kind of camera (movies, not snapshots), the kind of film (color), the kind of lens (telephoto), the area in which the pictures were to be taken, the time they were to be taken, and (after testing several sites) the spot on which the camera would be operated.6

So it would seem to me under this definition that Slater would be considered the author of the photographs.

I do think it’s interesting to note that the division between those who think the monkey is the author of the photo and those who think Slater is the author generally tracks the division between copyright skeptics and copyright proponents. On the one hand are those who have devalued creativity to the point where they think all it involves is the push of a button – even a monkey can do it. So, in that case, why do we even need copyright protection?

On the other hand are those who still recognize some value in human authorship, who think that creativity does not just spring forth independent of human effort, who understand that human effort does not emerge spontaneously but responds to motivation, and that one of the most just and dignified forms of motivation comes in the form of property acquired through creative productive labor.


Updated August 28, 2014 to correct photographer’s name

 

Footnotes

  1. In fact, the Copyright Act expressly allows for a civil infringement suit to be brought in cases where registration is refused. 17 USC § 411(a). []
  2. Itar-Tass Russian News Agency v. Russian Kurier, Inc., 153 F. 3d 82, 90 (2nd Cir. 1998). The court here was looking at the question of ownership, which is distinct from copyrightability, but I believe the analysis is the same. []
  3. 111 US 53, 58 (1884). []
  4. Feist Publications, Inc. v. Rural Telephone Service Co., 499 US 340, 345 (1991). []
  5. H.R.Rep. No. 1476, 94th Cong., 2d Sess. 120 (1976). []
  6. 293 F. Supp. 130, 143 (SDNY 1968). []

Will Indie Film Survive? — Scott Timberg: “One of the casualties of our current cultural situation is the erosion of the middle — the middle class, the midlist author, the middlebrow, and the mid-budget film. Independent film, with its interest in boundary pushing and risk-taking, may not seem to belong in that company, but it’s vulnerable to all the same forces.”

The Copyright Office Releases Public Draft of Compendium III — The US Copyright Office this week released its long anticipated new version of the Copyright Compendium, a detailed and comprehensive guide for examiners, as well as the general public, concerning copyright registration. At over 1200 pages, it may not be the best bedtime read, but it should prove invaluable as a reference.

Copyright Review Process Will Continue Into 2015; Education and Circumvention Will Be Next Issues Examined — With just a few weeks remaining before Congress returns from recess, BNA’s Tamlin Bason sat down with Representative Goodlatte to discuss the ongoing copyright review process and what we can expect in the upcoming months.

Why Don’t Today’s Hits Reflect the Times — Interesting article from Billboard. “Why don’t today’s top 40 acts have anything to say? Donovan laments that ‘[The] artists of 1960s and ’70s were much more socially conscious of the feelings and mood of the nation than many of today’s artists.’ Zapoleon adds, ‘Outside of [the] standard themes of love, sex, party and everyday minor social happenings in life, there just aren’t a lot of songs that are relevant to challenges people are facing today, or that talk about contemporary major events in America or the world.’”

Delaware becomes first state to give executors broad digital assets access — The law would allow an estate access to a decedent’s online accounts. Interestingly, the article notes that tech companies like Google, Facebook, and Yahoo oppose the law.

Why Exactly Is There a ‘Jarhead 2’? Hollywood’s Secret-Sequel Economy — Why make a sequel to a movie like Jarhead? It’s still playing big where it matters. The numbers make sense. The EVP’s team looks at DVD rentals, iTunes downloads, streaming numbers, TV distribution, and international markets. When asked of his intel-gathering methods, Ross is transparent: “I got Google.” Online chatter is a vital metric, too. Ross could produce a wartime movie that doesn’t infringe on the legacy of Jarhead, but slapping it with a stagnant IP gives it automatic legs. “It does some marketing for you. You come to it with a built-in consumer. You go on Facebook and people are constantly having dialogue about it,” Ross says.

The Free and the Antifree — A thought-provoking article from n+1 that asserts there is an emerging “antifree” movement that serves as a counter and critique to the “free culture” position.

Special announcement: If you’re a recent law school grad in or interested in DC and copyright, the Copyright Alliance and the Copyright Office are both hiring. Info on the Copyright Alliance legal fellow position here; info on the Copyright Office Barbara A. Ringer Copyright Honors Program here.

The Internet’s Original Sin — Spoiler alert: it’s advertising. A fascinating read that details why the reliance on ad-based business models may be destroying the internet. Ethan Zuckerman points to four downsides to this model: it encourages surveillance, reduces the production of thoughtful content, results in centralization of control, and causes negatives like filter bubbles and echo chambers.

Harper’s Publisher Standing Firm in His Defense of Print and Paywall — “His thesis is built on three pillars. The web is bad for writers, he said, who are too exhausted by the pace of an endless news cycle to write poised, reflective stories and who are paid peanuts if they do. It’s bad for publishers, who have lost advertising revenue to Google and Facebook and will never make enough from a free model to sustain great writing. And it’s bad for readers, who cannot absorb information well on devices that buzz, flash and generally distract.”

Reading Literature on Screen: A Price for Convenience? — “In most respects, there was no significant difference between the Kindle readers and the paper readers: the emotional measures were roughly the same, and both groups of readers responded almost equally to questions dealing with the setting of the story, the characters and other plot details. But, the Kindle readers scored significantly lower on questions about when events in the story occurred. They also performed almost twice as poorly when asked to arrange 14 plot points in the correct sequence.”

Warner Bros. Wins Appeal Over Fictional Technology in ‘Dark Knight Rises’ — Though not copyright, an interesting IP case involving the developer of a product suing the Batman studio for including in the film a product that used the same name. Spoiler alert: things did not end well for the developer. Said the Seventh Circuit, “Trademark law protects the source-denoting function of words used in conjunction with goods and services in the marketplace, not the words themselves.”

The Cult of Sharing — “None of the users of the new profit-driven services are under any delusion that they are transacting with others—the term sharing economy even highlights this fact. What’s crucial to realize is that proponents of ‘sharing’ are reinventing our understanding of economic relations between individuals so that they no longer imply individualism, greed or self-interest. Instead, we’re led to believe that commerce conducted on their platforms is ultimately about generosity, helpfulness, community-building, and love.

Is Spotify Killing Music? — “British singer-songwriter Billy Bragg has compared YouTube to Big Brother. ‘Rather than a huge boot stamping on a human face forever,” he said at a London press conference in June, “it’s a corporation that changes its logo every week.’”

No one cares about manufacturing costs — “Amazon wants to sell ebooks profitably at $9.99. In order to do that, they need publishers to sell them the books at some number less than that. It’s the same negotiation Home Depot has with Black & Decker. Except that you don’t see Home Depot setting up websites that selectively quote George Orwell to make their point.”

Orwell estate hits back at Amazon’s corporate ‘doublespeak’ — “Jean Seaton, director of the Orwell prize, an award for political writing set up in honour of the author, was equally outraged. ‘That Amazon should manipulate Orwell against the interests of writers and their publishers is dystopian and shameless,’ she said today. ‘Orwell, before he had any money, gave a lot of it away to poor and young and struggling writers. Amazon has no interest in writers and wants to throttle publishers. It is marching towards becoming a monopoly book and consequently a monopoly ideas provider – in order to maximise its commercial interest. A world in which all thought has to be bought from one place is Orwellian.’”

Stop Writing Dystopian Sci-Fi—It’s Making Us All Fear Technology — The future is fun, the future is fair.

Plot thickens as 900 writers battle Amazon — “Some writers wholeheartedly supported the letter but were afraid to sign, Mr. Preston said. A few signed it and then backed out, citing the same reason… Mr. Preston’s longtime writing partner, Lincoln Child, is among those with qualms.’I am very apprehensive,’ Mr. Child said. ‘Not all David and Goliath stories end happily for the little guy. But I think Doug did the right thing.’”

Kurt Sutter Attacks Google: Stop Profiting from Piracy (Guest Column) — The Sons of Anarchy producer pens a passionate call to action for his fellow creative professionals, highlighting the dangers of Google, which, as he puts it, “is in the process of systematically destroying our artistic future, and more importantly, the future of our children and grandchildren.”

Mossoff on Intellectual Property Rights as Property — Legal scholar Adam Mossoff writes an introduction to the recently published Intellectual Property and Property Rights, which “presents the three basic analytical frameworks in which intellectual property rights are defined or justified as property rights – historical, conceptual, and normative.” A good introduction for those interested in the academic discussion of IP and property.

‘Academic Urban Legends’ — Not copyright related, but should be of interest to those who engage in copyright scholarship. The article points out that the belief that spinach is high in iron is a myth. Scholars have long pointed out that the myth was caused by German scientists in the 1930s after they accidentally put a decimal point in the wrong place. But that story is also a myth, perpetuated by academic sloppiness in citation practices.

Of Macaques and Men: [obligatory monkey pun subtitle here] — Matthew David Brozik weighs in on #monkeyselfie. “Is it possible that Wikimedia and some lawyers have not heard of joint authorship?” he asks. “This legal fiction is surely preferable to the alternative, which denies Slater the full benefits of his efforts. The monkey did the smallest part of the work. The man deserves the reward.”

Aereo files emergancy motion on remand arguing it’s a cable provider entitled to Section 111 compulsory license — via Shades of Gray‘s Naomi Gray comes the just-filed memorandum of law from Aereo in support of its argument that, despite two years strenuously claiming otherwise, it is, actually, a cable provider. But only under the Copyright Act, where it can get the benefit of a below market rate compulsory license for transmitting copyrighted works, not under FCC regulations, which would subject it to retransmission consent and a host of other obligations.

Space Creators: Building the Guardians of the Galaxy — The Credits takes a closer look at some of the craftspeople involved in producing the big-screen version of Guardians of the Galaxy, opening in theaters today.

Copyright.gov — Did you see the redesigned web site for the US Copyright Office yet? Looks pretty sharp!

Ultra Records Responds to Michelle Phan & Kaskade Copyright Controversy — “When a music artist or songwriter signs to Ultra, it is our responsibility to protect what they have created. Enforcing copyrights is fundamental to the survival of artists, writers and producers, and to Ultra’s ability to continue to invest in and support them, so that they can continue to bring great music to music fans around the world. Whatever Ultra collects enforcing these important rights is shared with its artists according to their agreements.”

Should there be a system for resolving small copyright claims? — A look at last week’s House Judiciary IP Subcommittee’s hearings on copyright remedies and the question of whether Congress should create an expedited process for resolving copyright disputes involving low dollar amounts. Last year, the US Copyright Office released a report recommending just that.

We’re All Waiting, BitTorrent — “Funny how some technology companies like BitTorrent are always extolling the unlimited power of technology – except when it can be used to help creators by preventing the unauthorized distribution of their creative content.”

This past week, a DVD quality copy of Expendables 3 leaked onto online pirate sites, weeks before its August 15 box office debut. Along with the news came the usual claims that filmmakers shouldn’t worry about pre-release piracy—it’s good promotion, says David Pierce at the Verge, and internet commenters offer scores of other rationalizations.

But over at the Technology Policy Institute Blog, researcher Michael W. Smith says the unauthorized pre-release copy will likely hurt box office revenues for the film. He and his colleagues studied the effect of pre-release movie piracy on box office revenue and found that, on average, it “results in a 19% reduction in box office revenue relative to what would have occurred if piracy were only available after the movie’s release.”

Smith’s study is the first peer-reviewed journal article to look at this particular form of piracy. It was recently accepted for publication in the Information Systems Research journal, but a pre-publication draft is available at SSRN.

The study casts doubts on claims that pre-release piracy has no impact on theatrical revenue or even has a beneficial effect by generating buzz. On the contrary, Smith finds that “pre-release piracy significantly reduces a movie’s expected box office revenue and that this impact is stronger earlier in a movie’s lifecycle than in later periods.”

Smith concludes the report by noting some of its limitations. It doesn’t look at the intensity of pre-release pirating, nor at the quality of the unauthorized copies, data which may provide additional insights. It also does not consider the effect of pre-release piracy on different types of films, nor does it examine the effects on revenue streams besides the box office, such as DVD sales.

These last two limitations are particularly worth further research. Most films—particularly indie and niche films—don’t ever screen in theaters, and even among those films that do, box office revenue is only a part of overall revenues.

While Smith’s study is the first peer-reviewed article to look specifically at pre-release piracy and its effects, it is not the first to look at the effects of other forms of piracy on films. In fact, in his article, Smith notes that eight peer-reviewed studies so far have looked at the effect of piracy on film sales, and, more significantly, seven of the eight studies have found “that piracy results in significant harm to motion picture sales.” A broader literature review – focusing not solely on films but on other types of works such as recorded music – found that “The vast majority of papers which have been published in peer-reviewed academic journals — papers spanning a variety of methods, time periods, and contexts — find that piracy causes a statistically significant decrease in sales.”

And yet some measure of file-sharing denialism persists. It, first, runs counter to common sense—yes, if people can get something for free they’ll buy less, and if people buy less of something, less of it will be produced. But it also, as seen above, is not supported by the overwhelming majority of empirical evidence.

In ‘The Expendables 3’ Torrent and the Techno-Utopian Delusion, Indiewire writer Sam Adams sees through this denialism, or, as he calls it, “sheer self-justifying delusion.” In doing so, he touches on a larger point.

Adams notes that some of the rationalization for downloading The Expendables 3 is based on the idea that it is not a movie but a show, one in which the experience of watching in the theater takes precedence (and thus justifies watching an illegitimate, lower-quality version). Because of this, he cautions:

And when you’re paying for the experience — not out of curiosity or as a way of supporting an ecosystem that allows the creation of new work — it only makes sense to sample the product beforehand. But in so doing, you’re pushing cinema in a direction where every movie has to be a show: Either it’s big and loud enough to make you feel like you’re missing out by watching it (legally or illegally) at home or it might as well not show up to play.

CNET’s Nick Statt raises similar concerns:

We often complain about “sequelitis” and the onslaught of low-quality, brainless action movies and series reboots, yet don’t ever seem to take responsibility for the fact that our collective unwillingness to pay for things that don’t have formulaic payout is what drives creative decision making.

In the current model, everything from “Boyhood” and “12 Years A Slave” to “Zero Dark Thirty” and “Gravity” are more harmed by systemic piracy because it devalues films as an art form. Risks are not rewarded when the only movie with a concrete return on its investment is a $200 million narrative train wreck about robot cars or a tongue-and-cheek ensemble action flick featuring Rocky, the former governor of California, and Han Solo.

I enjoy such films, as do millions of others. But it would be a shame if that was all we got to see. The ultimate point is that piracy has societal effects beyond any given film’s bottom line.

In Copyright Extremophiles: Do Creative Industries Thrive or Just Survive in China’s High-Piracy Environment?1 published earlier this year, Eric Priest digs into some of these less obvious effects of piracy in more detail. The claim is sometimes made that maybe copyright—the legal foundation that provides exchange value for creative works—is irrelevant since creativity still exists in areas, such as China, where piracy runs rampant. Priest refutes this by comparing creators in high-piracy areas to biological organisms known as extremophiles.

Just as microorganisms have evolved to thrive in superheated deep-sea vents or highly acidic environments, so too can a subset of creative professionals find ways to monetize their works even in a high-piracy environment. The fact that some monetization models can work for some types of producers or artists in China does not mean that optimal or even near-optimal conditions exist for the development of flourishing, healthy, and stable creative industries. In short, poor copyright enforcement inflicts significant and persistent harms on China’s music and film industries. To invoke the extremophiles analogy, China’s inhospitable creative industry environment may support narrow strains of creative “life,” but with an effective regime of copyright norms and enforcement, China’s creative ecosystem could more closely resemble a lush, diverse rain-forest.

Priest’s research unpacks some of the more pernicious results that piracy has on China’s film and music industries. Along with undermining the ability of a professional class of creators to sustain their livelihoods, high piracy has made these industries “neither robust nor stable” and lead them to become “hyper-dependent on a single revenue stream” (box office for films and ringback tones for music). Priest concludes:

This lack of revenue stream diversity distorts and undermines the creative ecosystem in at least three ways. First, the scarcity of monetization options creates a winner-take-all market dominated by big producers. The paucity of other revenue sources seriously undermines financial support for smaller, independent producers.

Second, rampant piracy and concentration of revenue streams distorts market signals to producers. For example, film producers are incentivized to invest in a relatively narrow range of works that attract the audience whose tastes are most easily monetized – young, urban cinemagoers. Music producers likely are incentivized to produce music that will make the most marketable ringtones.

Third, and perhaps most importantly, reduced revenue stream diversity disproportionately exposes producers to the whims of peculiar markets and exploitation by gatekeeper or monopsonist intermediaries. China’s music industry proves an especially vivid example, as ringback tones gross more than $4 billion annually, but the mobile operators who control ringback tone distribution keep more than ninety-eight percent of that revenue for themselves. The meager two percent that goes to copyright owners amounts to ninety percent of those copyright owners’ total income from recorded music. So if ringtones lose their appeal with consumers, the recording industry will collapse. Without other viable revenue streams to leverage, musicians, producers, and record labels have little choice but to grin and bear it while a state telecommunications monopoly enjoys the great bulk of the rewards of their artistic efforts.

It seems difficult to make a more compelling case for copyright. How creators and the film industry responds to pre-release and other forms of piracy is a wholly separate topic, but the fact remains that any type of piracy has a significant negative effect on revenues as well as the stability and vitality of creative and cultural industries. If we want to maintain robust and independent creativity, we should not be so quick to treat copyright as expendable.

Footnotes

  1. 27 Harvard Journal of Law & Technology 469 (2014). []
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