Re: copyright expiration as a spur to creativity

Michael Bradley <michael[_at_]vision-soft.com> wrote:

> 
>      My argument is that very few of those who live by selling rights to
> their IP support shorter terms (big surprise).  Arguing, as so many have
> in this thread, the shorter terms will increase creativity seems, um,
> dumb.  It's demonstrably contrary to simple fact.

First of all, you are lumping two categories of IP dealers into one with this statement. There are those who make money trading in IP and those who make money by creating and selling IP. Those who trade in IP rights (and I include here publishers who don't actually own IP but have bought rights to publish) are going to argue for longer terms because it effects their ability to trade in their existing IP interests. This has very little to do with incentive to create. It is about extending the life time of revenue streams.

Those who create IP and sell it as soon as possible may have the present value of their creations increased marginally by an increase in term, or decreased marginally by a modest decrease in term. The argument has been that this marginal change in value is unlikely to have much effect on the decision to create or not to create, particularly since the value of most works is realized in the first few years of publication anyway whether it be films, music, software or books. It is only the exceptional works that have significant value many years after publication and it is often difficult to predict which works will fall into that category at the time of creation. They might still argue for a longer term, because of the increased value. I suspect that there are actually very few people in this category actively lobbying for an extended term. If they are, then I doubt they realize how marginal that extra value would be.

The third category is really a combination of the first two, those who create the IP but retain it and trade in the rights. I argue that their financial motivation is dominated by their trading role and not their creating role.

The appropriate question to ask creators of IP is not "Would you like the protection term to be longer?" Of course they'll answer yes because they can only benefit. Rather, you should ask "Are there any works that you would not create now that you would create if the protection term was longer?" For the vast majority of creators I suspect the honest answer will be "No" or at best "Very few".

The fourth category (which you understandably avoid) are those who create derivative works. If you ask people in this category, I'm sure they will want a reduction in term of protection rather than an increase. If a work is in the public domain, they can avoid the often expensive exercise of determining who the rights holders are, let alone the royalty payments or denial of permission problems.

There is also a fifth category of people who just use works. Their interests are essentially the same as creators of derivative works. Their access to works affects the dissemination and free flow of information necessary to promote the useful arts and sciences.

The decision to extend or shorten protection times should not be made by any one of these groups, but should balance their interests.

To extend the term for future works:

• traders in existing works will not be affected, but will be prepared to pay (very slightly) higher prices for works from pure creators;
• pure creators will have a (very slightly) higher price paid for assigning their rights meaning a small number of works which might now be financially marginal might become viable (I challenge you to name some ;-);
• creator traders will have the same increase in incentive as pure creators;
• derivative creators will have to wait longer for those works where permission is refused, and pay more to use those that are protected but are licensed.

To reduce the term for future works:

• traders in existing works will not be affected, but will pay a reduced proce for works from pure creators (by how much depends on the reduction);
• pure creators will have the value of their rights reduced (by how much depends on the reduction) i.e. reduced incentive to create;
• creator traders will have the same reduction in incentive as pure creators;
• derivative creators will benefit by having an increased pool of material available without hindrance or royalties, and reduced cost of license for those works still protected.

To increase the term for existing works:

• windfall for traders;
• no affect on pure creators;
• windfall for creator traders;
• derivative creators, may have permission denied for works they have already costed assuming public domain, or royalties imposed where none would have been owing.

To decrease the term for existing works:

• reduction in revenues for traders (unfairly devaluing assets previously purchased);
• no affect on pure creators;
• devaluation of assets created assuming an invalid value model;
• derivative creators will benefit by having an increased pool of material available without hindrance or royalties, and reduced cost of license for those works still protected.

For this reason, increasing or decreasing the term for existing works leads to unjust results for at least some party (and faces constitutional problems in the US). There is no justification for it. It just shouldn't happen. Of course it is not difficult to see why traders and creator traders would want to lobby for it though!

Increasing or decreasing the term for future works is a balance between the value of increasing or decreasing the availability of existing works for distribution (including by new means of distribution not contemplated at the time of creation) and use in new derivative works, and decreasing or increasing the present value of new works as an incentive for creation. I personally think that 50 yrs + life is sufficient incentive for creation, and perhaps a little too far in chilling availability. On the other hand, I would be quite happy to have an increased term of protection (even a perpetual one) if a compulsary licence was available after a much shorter time (or even immediately).

There are important questions about how far such a compulsary licence could or should extend.

Should it extend to unpublished works (I argue that there are more appropriate remedies for protecting confidential information)?

Should it be only for the creation of derivative works (satisfying the compelling argument for making derivative works possible despite the wishes of the original creator)?

Should it operate only after the creator has had a chance to exploit the work for a period of time (say 10 years)?

Should it be activated only when a published work becomes unavailable (satisfying the argument that the work is not altered in any way and the creator has already exhibited a willingness to have it available so it should be available to all willing to pay the royalty)?

Could we ever get the Europeans with their moral rights tradition to participate?

-- 
| Tim Arnold-Moore, LL.B., B.Sc. (Hons)
| Postal address:  Multimedia Database Systems, RMIT
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|	simul iustus et peccator
<tja[_at_]mds.rmit.edu.au>