Who really benefits from intellectual property law? And who should?

LA Times ^ | February 3, 2010 | August Brown

[a fool in paradise]

...Matt Yglesias... proposed that in a perfect marketplace for music,"The price of a song ought to be equal to the marginal cost of distributing a new copy of a song. Which is to say that the marginal cost ought to be $0."

In a followup post... He argues that the entire infrastructure of intellectual property law is designed to bring the cost of all creative products down, eventually to zero, where it's best able to serve the most possible consumers; he cites the expiration date on the copyright of creative work as clear legal intent for all intellectual property to become free. He compares this to the reasoning behind expiration dates on patents for pharmaceuticals, so as to allow for cheaper generic drugs that improve lives for much less money while still providing a financial incentive to pursue new research.

This is a perniciously populist approach to how your information-market sausage gets made.

His example is wrong for two reasons. One is in his misreading of the motivation behind various copyright and patent law expiration dates. Under current copyright law, a writer, musician or artist has claim over his or her intellectual property for their life plus 70 years. That's a pretty clear indicator that copyright law was designed not only for the artist to (hypothetically) have claims to the profit from a song for their entire life, but that their children and grandchildren should as well. The patent on brand-name drugs expires 20 years after the patent is granted. The wide difference suggests a clear intent as to who the beneficiary of these laws should be -- for drugs, it's a consumer; for art, it's the artist. This is why you can't sample P-Funk or the Beatles without taking out another mortgage, but you can get penicillin for pennies...

[mnehring]

The price of a song ought to be equal to the marginal cost of distributing a new copy of a song

Errr... no, the price of a song ought to be whatever the owner of said song wants to charge and the market can decide if said price has value to the consumers.

[randomhero97]

Errr... no, the price of a song ought to be whatever the owner of said song wants to charge and the market can decide if said price has value to the consumers.

Why is that so difficult for so many to understand?

[mnehring]

Because they don’t want to pay for it. Friggin hippies. Of course, if it was their own work, I bet their attitude would change.

[a fool in paradise]

The author neglects to mention that the significant extensions of copyright all came in the 20th century as Big Media sought to protect their monopoly on America’s artistic and cultural heritage.

The complete works of Edgar Allen Poe and Mark Twain are public domain. But not those of Dashiel Hammett. All are long dead. Is the protected one a better author than the others? More significant?

The 70 year extension make a mockery of the constitutional intent for works to lapse into the public domain.

And just because a medicine may aid recovery is not reason for ALL patents to lapse into the public domain in 20 years. What of ashtray designs? Whoopee cushions? Rubik’s Cubes?

All works are covered by this policy. Computer companies understand this. As do soda manufacturers. They keep their corporate secrets out of the patent office (and yet they take certain precautions to be able to protect their works should someone infringe on their designs).

[OldDeckHand]

"Errr... no, the price of a song ought to be whatever the owner of said song wants to charge and the market can decide if said price has value to the consumers. "

I agree completely. You might be surprised how many on this very board don't.

[a fool in paradise]

They can charge whatever they want. Companies buying legislators to keep renewing copyrights every 26 years is not law. It is lobbying that deprives the marketplace.

Hollywood has been kept solvent selling America 50 year old product that should be in the public domain by now (as was formerly the case under the law).

Hollywood would be more responsive to the market when they try to push Left wing antiwar propaganda as infotainment. But they reap billions off of works produced by dead people (many of whom were employed under “work for hire” contracts and do not receive any further payments).

The author of the article somehow thinks that the work of scientists and inventors should NOT be likewise protected or allowed to be sold for whatever price the market will bear.

[the invisib1e hand]

And who should?

The originator.

[OldDeckHand]

"Hollywood has been kept solvent selling America 50 year old product that should be in the public domain by now (as was formerly the case under the law)."

That may or may not be true. I don't know enough about the mechanics of Hollywood finances to comment, nor do I really care. But, the central thesis of the original story that this particular LA Time's Blog is responding to, is that all songs, to include contemporary songs, should be downloadable for free. That is a statement that philosophically, I just can't agree with.

I have said before, and will say again, when you download a song - a newly released song - from the internet for free, it is just like walking into Walmart and shoplifting a CD.

The half-life of patents or copyright claims might be a interesting intellectual discussion, but it's not really material to some kids ability or willingness to download the latest Beyonce LP without paying for it.

[DrC]

“The author of the article somehow thinks that the work of scientists and inventors should NOT be likewise protected or allowed to be sold for whatever price the market will bear.”

Right. The distinction drawn by the author makes no sense. Both copyrights and patents are designed to PROTECT intellectual property. The purpose of each is to maximize the benefits of intellectual creativity.

Giving too little protection (short periods during which creators can charge whatever price the market will bear) may discourage creativity (or result in too much of it taking the form of trade secrets rather than being put into the public domain where all can make use of it once the period of protection expires).

Giving too much protection won’t increase the net amount of creativity very much, but will stifle the downstream benefits that come from generic price competition (in the case of drugs) or more widespread distribution (e.g., Google Books makes available for free a large number of works whose copyright protection has expired).

So the length of patent protection and copyrights always is a balancing act. Society loses to the extent that such policy decisions are contaminated by letting corporate interests buy influence to tip the balance in their favor. A world that confers NO period of protection for patents or copyrights surely cannot be optimal. But neither can a policy that extends the period of protection far beyond the death date of the creator. Let’s acknowledge that most creators aren’t motivated to create based on how much their great-grandchildren will benefit from their creativity.

[hoosierham]

For almost two centuries in the U.S. of A. the copyrights expired in a much shorter time;it wasn’t broke and didn’t need fixing.Disney and Hollywood went all indignant that people might see/hear 50 year old works without paying royalties and so the media moguls bought some members of Congress to change the laws.

[The_Reader_David]

The Constitutional basis of intellectual property law is the clause which lists among the enumerated powers of Congress, “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.”

Somehow this now functions as if it read “To impede the progress of science and useful arts, by securing for indefinitely extendable times to commercial interests and literary and artistic estates the exclusive right to the writings and discoveries of authors and inventors who signed away their rights or died.”

The fact that Henry Holt and Co. at around the turn of the 21st century could prevent the use of Robert Frost’s (d. 1968) 1928 poem “Fire and Ice” as song lyrics is proof positive that American intellectual property law would be tossed out as unconstitutional were we to have honest judges who believe in the Founders’ intent sitting in our courts. (A parallel imbecilic case about derivative use of a musical theme written in 1935 in a 1988 song just came through the Australian courts.)

Martha Graham’s dance legacy was largely destroyed by the way our intellectual property law “promotes” the arts: her artistic estate would not allow dancers who had muscle memory of her choreography to perform and teach others to perform her works for years after her death over quarrels about royalties.

Incidentally, I agree with the remarks of those who advocate market valuation of the arts. The thing is folks aren’t willing to pay very much for a copy of something when the marginal cost of making a copy is $0.00. Business models based on selling dead trees (or plastic disks) should not be protected by government grants of monopolies and the exercise of state-power.

[Vermont Lt]

Exactly.

As professional photographer I am constantly amazed at the number of smart people that think because my work is digital that they should be able to access it and use it for free. Just today I had to go round and round with a magazine over the use of one of my photos. Because I was paid by a third party the felt that I had already been compensated enough for it. And they said that the ?exposure? would be good for me. I asked if my kids could use that to pay their tuition. But if I went to their web site and copied an article and posted it here they would sue FR for infringement.

Just pay for someone else work. Do not steal. It is really pretty simple. If they want too much, don’t buy it.

[a fool in paradise]

In the 1990s, the music corporations got caught price fixing. They illegally agreed universally to inflate prices to stores (with casettes, which had higher production costs, having a lower sell through price).

There was a multistate class action lawsuit on this matter, but please continue to shill for gangsters.

English rock group Pink Floyd was one of the hottest bands in 1980, with an LP shooting up the charts and a concert tour that sold out within hours. But the group was unable to get airplay for its latest single, at least not without engaging the services of a nascent breed of freelance promoters whose practices ushered in a new era of payola. These promotors, dubbed "indies," used illegal methods and had suspected mob connections. That the recording industry not only tolerated but embraced the indies is indicative of the questionable tactics now employed in this high-stakes arena, charges Dannen in a sharply critical study. At its center is industry leader CBS records, whose president Walter Yetnikoff is depicted as a bully of Machiavellian proportions whose style set the tone throughout the business in the '80s. Dannen, a reporter for Institutional Investor , mixes the skills of an investigative journalist with the gifts of an expert storyteller in an expose that will intrigue and appall readers with its disclosures.

They can charge what they want, they can't price fix and gouge consumers.

It is "interesting" that a digital download of an album can cost the same price point that a physical CD (which could be resold to a used store and then repurchased by another consumer) which has manufacturing costs, delivery costs, brick and mortar inventory costs, salesman costs...

Digital download copies do not have these investment costs (and there is no "overproduction" resulting in cutout bins).

I don't stand with those who say "give it away". I don't see why patents should have to exire "for humanity's benefit" and copyrights should last 100 years now.