The story of modern IP, of course, is the story of attempts by the monopolists to eliminate the gaps between the two (DRM, other attacks on fair use, etc.)
Steve R.
· 2 years ago
Again you ask an interesting question. But in this case, I am somewhat troubled, by some of your language since it seems to be a precursor to eventually concluding that infringement is somehow "stealing" revenue (as indicated by the distance between lines AR and D in Figure 2.)
First (to address the question of explaining the distance between lines AR and D in Figure 2) the distance between these lines is created by the availability of "free" content (legal and illegal).
To explain, as you correctly note, the demand line is an "aggregate" line. As an aggregate line it is the sum of alternate, substitute, and similar demand. Furthermore, demand is not necessarily for a discrete physical product. For example, buying a book is not the "demand" of line D. The demand of line D is more appropriately "three hours of recreational time" since the book buyer could have gone fishing (alternate), could have bought a DVD (substitute), or could have bought a book of a different title (similar).
Now if you consider the time spent on the TLF as recreational (in competition with buying a book), this "free" non-monetized time pushes line AR to the left away from line D. We could also say that going to the library and checking the book out would have the same effect of pushing line AR away from line D. ------------------------------------------------ Second, the implicit assumption that IP owners are somehow being victimized needs to be questioned and tested. My viewpoint is that we are dealing in shades of gray. Tim in "Good Fences Make Good Neighbors" (TLF, 8/24/200) reiterates that we need clear property lines to establish ownership. Artistic content, in many cases, lacks clear property lines because of its subjective nature.
Furthermore, many content producers are now asserting so-called rights, that I believe they do not possess, to take away the rights of the consumer. In a sense, we can say that the content producers, in some cases, are "stealing" from the consumer. So when I read statements such as "Some such uses happen through infringement, such as street corner sales of pirated DVDs. my red-herring detector goes bonkers. ------------------------------------------------ You raised the issue of "government services". Again I wonder if this is a precursor for somehow concluding that the government should not be involved in the free market system. My belief is that the government services have a right to participate and if private industry can't compete too bad. Private industry has no intrinsic right to a profit.
David Wynn
· 2 years ago
I think this is a great issue to explore, and I look forward to future posts.
Personally, my biggest issue with the IP market is the goal of copyright itself. It's designed to encourage innovation, but due to increasingly lock-down approaches to enforcing it, the borrowing and reshaping that drives artistic innovation is being cut off.
...At least in my opinion.
Steve R.
· 2 years ago
It occurred to me that the aggregate demand line should defined as being be limited to "first sale" where the revenue from that sale makes its way back to the producer. What that means is that subsequent sales, through outlets such as used book stores, thrift stores, have the effect of pushing line AR to the left away from the demand line since the producer is not realizing direct revenue from that sale.
Of course, the sale of goods in the secondary market is still an economic benefit and can still provide subsequent revenue to the original producer through ancillary sales.
Tom W. Bell
· 2 years ago
Luis: That's part of the story, granted. But another big part of it attempts (successful ones) to expand the scope of copyright. See, e.g., the Sony Bono Act.
Steve R.: I'm just trying to figure out how copyright works, right now. I won't pretend that I'm not predisposed to favor certain outcomes--my advocacy of "intellectual privilege" should show that much--but you shouldn't read too much into the present post.
David: I'm worried about the over-extension of copyright, too. Hence my effort in trying to get a firm grip on how to evaluate it as a matter of policy.
Steve R. (again): The price of the first sale should include the value of the future uses--including resales. For an excellent explanation of that idea, see Easterbrook's opinion in Lee v. A.R.T. Co., 125 F.3d 580 (7th Cir. 1997).
All Comments
First (to address the question of explaining the distance between lines AR and D in Figure 2) the distance between these lines is created by the availability of "free" content (legal and illegal).
To explain, as you correctly note, the demand line is an "aggregate" line. As an aggregate line it is the sum of alternate, substitute, and similar demand. Furthermore, demand is not necessarily for a discrete physical product. For example, buying a book is not the "demand" of line D. The demand of line D is more appropriately "three hours of recreational time" since the book buyer could have gone fishing (alternate), could have bought a DVD (substitute), or could have bought a book of a different title (similar).
Now if you consider the time spent on the TLF as recreational (in competition with buying a book), this "free" non-monetized time pushes line AR to the left away from line D. We could also say that going to the library and checking the book out would have the same effect of pushing line AR away from line D.
------------------------------------------------
Second, the implicit assumption that IP owners are somehow being victimized needs to be questioned and tested. My viewpoint is that we are dealing in shades of gray. Tim in "Good Fences Make Good Neighbors" (TLF, 8/24/200) reiterates that we need clear property lines to establish ownership. Artistic content, in many cases, lacks clear property lines because of its subjective nature.
Furthermore, many content producers are now asserting so-called rights, that I believe they do not possess, to take away the rights of the consumer. In a sense, we can say that the content producers, in some cases, are "stealing" from the consumer. So when I read statements such as "Some such uses happen through infringement, such as street corner sales of pirated DVDs. my red-herring detector goes bonkers.
------------------------------------------------
You raised the issue of "government services". Again I wonder if this is a precursor for somehow concluding that the government should not be involved in the free market system. My belief is that the government services have a right to participate and if private industry can't compete too bad. Private industry has no intrinsic right to a profit.
Personally, my biggest issue with the IP market is the goal of copyright itself. It's designed to encourage innovation, but due to increasingly lock-down approaches to enforcing it, the borrowing and reshaping that drives artistic innovation is being cut off.
...At least in my opinion.
Of course, the sale of goods in the secondary market is still an economic benefit and can still provide subsequent revenue to the original producer through ancillary sales.
Steve R.: I'm just trying to figure out how copyright works, right now. I won't pretend that I'm not predisposed to favor certain outcomes--my advocacy of "intellectual privilege" should show that much--but you shouldn't read too much into the present post.
David: I'm worried about the over-extension of copyright, too. Hence my effort in trying to get a firm grip on how to evaluate it as a matter of policy.
Steve R. (again): The price of the first sale should include the value of the future uses--including resales. For an excellent explanation of that idea, see Easterbrook's opinion in Lee v. A.R.T. Co., 125 F.3d 580 (7th Cir. 1997).