Information Policy and The Red Herring of a Media-Tech Industry War

In an article published earlier this year, University of Wisconsin-Milwaukee professor Sandra Braman defined “information policy” as positions and practices that concern the creation, processing, flows, access and use of information. The term certainly includes content, much of which is subject to protection under this nation’s Copyright Act, and the telecommunication pipes through which that content travels. Given this definition, it easy to see how businesses regulated by copyright and telecommunications law enjoy a synergistic relationship.

The Internet’s public availability in the early 1990s did not fundamentally alter this information policy landscape. But the Internet, along with simultaneous developments like unprecedented personal computing power, did make it possible for non-traditional actors to create, send, access and process significantly more copyright-protected information through increasingly faster telecommunication pipes. The rise of this non-traditional class also has spawned new businesses like Google (including its YouTube subsidiary), Facebook and, while encouraging or forcing traditional actors to evolve into new businesses (such as Comcast, a telecom company, buying NBC-Universal in a merger that was completed earlier this year).

Despite the historical and continuing synergy between copyright and telecom, there has been a recent, aggressive line of thought that argues these non-traditional entrants into the information policy landscape have grown powerful by free riding on the works of large corporate copyright owners. This argument arose during last month’s Governance of Social Media workshop at Georgetown, which Michigan State University’s Quello Center helped sponsor. The argument also manifests itself in Robert Levine’s new book, Free Ride: How Digital Parasites Are Destroying The Culture Business, and How The Culture Business Can Fight Back (2011, Doubleday).

Free Ride seeks to reframe the debate about the business of selling cultural commodities, who is to blame that business’ demise, and how law and information policy should deal with this problem and culpable actors. “The conflict over the future of online media has been framed as one that pits media conglomerates against a demanding new generation of consumers who want music and movies their way,” writes Mr. Levine. “The real conflict online is between the media companies that fund much of the entertainment we read, see, and hear, and the technology firms that want to distribute their content – legally or otherwise.” Levine’s central thesis is technology-centric, information policy participants like Apple, Netflix, and YouTube access, use, process and distribute the protected works without returning full economic value to creators or copyright owners. Further, he argues the same group has fostered a dangerous public atmosphere that encourages the “information wants be free” ethos in a way that focuses more on lack of payment than frictionless (but compensated) distribution in a globally networked society.

There is merit to a portion of Levine’s dangerous public atmosphere observation. I agree there a fundamental lack of respect for copyright law exists today. The public support and generally favorable press coverage given to Jammie Thomas-Rasset and Joel Tenenbaum, both of whom federal courts found liable for copyright infringement, exemplify this attitude. I have expressed my view that support for either party is objectionable on every legal, business and moral level.

It is unclear whether this lack of respect for copyright is connected to the system’s widespread and well-chronicled problems. As a writer, educator, musician and former journalist, I am concerned that a system I love and respect is so problematic for so many. I also am concerned, however, that so many so frequently dismiss the copyright system in ignorance, resisting meaningful engagement with it while blindly relying on others – regardless of apparent credentials – to freely color their view of it.

While copyright’s purpose is to encourage learning, it also has been creative works’ monetization mechanism. So in presenting my work to the public, I need to decide whether or not I want to sell or license the work, to whom, and under what terms and conditions. Since I have both succeeded and failed in these transactions, I understand that having exclusive rights gives me a chance to earn money from a work that suffers a public goods problem. But I also understand that having that opportunity does not guarantee I will earn such income.

Put another way, copyright’s incentive justification does not guarantee any copyright owner’s ongoing financial success or viability. Yet, Mr. Levine argues differently in Free Ride, and in doing so, I believe his thesis rests upon some questionable presumptions. In arguing that new technology entrants into the information policy space are taking advantage of copyright owners, Mr. Levine presumes those that depend upon copyright deserve to be saved – both as a general principle, and specifically from these technology businesses. Second, he presumes copyright owners have a right (instead of merely the opportunity) to earn revenue from licensing or selling rights in their works. Finally, Mr. Levine presumes copyright owners are in the culture business.

Concerning Levine’s presumption that copyright owners are in the culture business, I posit that they never have been in the culture business. Instead, they have been in the business of selling commodities upon which culture is embedded. This distinction is critically important. Treating culture as a commodity that can be produced, distributed, and sold like widgets or paper clips relies on full control of the production chain: from ownership of the ideas through the “work made for hire” doctrine through distribution to market. The public availability of global communications networks like the Internet and the move to digital forever changed that dynamic, particularly at the distribution end. The music business, in particular, encouraged the move to digital to profit from another round of format shifts, as Mr. Levine, a former Billboard editor, knows. The combination of digital and the Internet disrupted the control upon which a commodity business depends; without absolute control of the saleable product, the cultural commodity business model began to falter. While technology companies arguably were in a better position to adjust to this “new normal,” they did not create it. Therefore, it’s questionable to blame them for it.

Regarding Mr. Levine’s second presumption, copyright law never has entitled its owners to extract full and complete economic value from a protected work. What has changed is the thinking that it does. This viewpoint started in the eighties, when U.S. policy makers decided to emphasize intellectual property as America’s economic engine. U.S. policy makers emphasized this viewpoint again during early 1990s policy discussions about the effect of the global information superhighway on the rights (and income streams) of traditional intellectual property owners. Further, the purchase of cultural assets by divisions of publicly held, multinational companies also contributed to this viewpoint. The rationale is simple: If your stock price relies on the sale of cultural commodities, and you no longer have absolute control over the distribution of those commodities, then you’re more likely to seek maximum value from every remaining commodity you can control, lest your balance sheet reflect losses or slower sales. Again, the technology companies had little to do with these circumstances.

Finally, Mr. Levine’s first presumption – that companies which depend upon copyright deserve to be saved – should not be a conclusion, but instead an information policy and economic issue. That issue begs a more disturbing question: Have the copyright industries become too big to fail? The federal government recently intervened in the free market to avoid a situation many felt would result in the financial system’s collapse. The copyright grant is a free market intervention from which the music, news, publishing and movie industries have benefitted for centuries. Yet, these industries still face troubles, even with such help. How much more aid should we give them? Moving forward, we – policy makers, copyright owners, technology companies, telecom companies and, most importantly, the public – must decide whether the industries that depend upon copyright are too big, or too important, to fail. That should not be a baseline presumption, but rather a well-considered investigation and solution into what Mr. Levine and I agree is a serious problem.

Note: Portions of this article were published previously as Dames, K. M. (2012, April). The red herring of a media-technology industry war. Information Today, 29(4), 26-27.

Written by Dr. K Matthew Dames

07/01/2012 at 09:36

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