Recent Changes to Copyright:
Attacks Against the Public Interest
Howard Besser
Associate Professor
UCLA School of Education & Information
http://www.gseis.ucla.edu/~howard/
written 1998 (This is a longer version of the article published in Peace Journal 11:1, March 1999)


In the past two years we have seen a major effort aimed at overhauling intellectual property law. Under the guise of responding to the challenge posed by the increasing amount of information in digital form, the content industry (publishers, motion picture studios, music distributors, etc.) has engaged in a veritable assault on long-standing public interest practices. In what law professor Pam Samuelson has termed the "Copyright Grab" (Samuelson), the content industry is exploiting concerns over digitization and attempting to reshape the law by strengthening protection for copyrightsholders and weakening public rights to access and use material.

In this article, the author first examines intellectual property law’s origins as an attempt to create a public good. He then discusses how both the advent of digital technology and the consolidation of control in the hands of the content industry have created new structural and economic conditions for intellectual property. He shows how the content industry has in the past tried to exploit changing underlying conditions in a effort to strengthen their ownership rights, and demonstrates how they are doing that again in the current environment. Finally, he cites the threat to "social good" from the content industry’s continuing success at reshaping public policy.
 
 

The Origins of Copyright in the US


Though many copyright holders view copyright as an "economic right" that protects their ability to make money off content, US copyright law was actually established to promote the "public good" by encouraging the production and distribution of content. Article 1, Section 8 of the US Constitution states:

The Congress shall have power ...to provide for the ... general welfare of the United States 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; [emphasis added] The goal of copyright is to "provide for the general welfare" and "promote the progress of science and useful arts" by encouraging further creation. The rationale behind copyright is that granting creators temporary monopoly rights over their creations will encourage them to create more. The real goal of copyright is to ensure that new knowledge will be developed and circulated through society.

Underpinning much of the recent rhetoric by the "content industry" is a view of copyright as an unlimited economic right. This logic is misguided since the economic rights granted by copyright are just a byproduct of attempts to fulfill the societal need to increase creativity. Though it granted Congress the power to give creators monopoly control over their creations, the Constitution was careful to set controls on that monopoly by stating that it could only endure for "limited times".
 
 

Fair Use and First Sale


Prior to the "digital age" a delicate balance had emerged between copyright holders on the one hand, and the general public on the other hand. Copyright holders had certain exclusive rights over their material, but those rights were tempered by access rights held by the public. The two most important public rights were fair use and first sale.

Fair Use (a common practice which was codified into law in Section 107 of the 1976 Copyright Law) limits a copyright holder’s monopoly over the use of his/her work by permitting copying under a limited set of circumstances for uses such as education, private study, and satire. The fair use doctrine assumes that these types of uses constitute a compelling enough social good that even if a copyright holder wanted to prevent such uses of their material, the law would not support them. It is fair use that allows students to photocopy copyrighted articles for personal use, teachers to read excerpts from copyrighted works in class, reviewers to quote from copyrighted works in their published reviews, and satirists to incorporate portions of copyrighted works into their satires.

The First Sale doctrine limits a rightsholder’s control over a copy of a work to the very first time that copy is sold. According to first sale, anyone who purchases a work can then do what they want with that copy, even if the rightsholder opposes that use. First sale allows the purchaser of a work to resell it, lend it, share it, or destroy it -- without ever consulting the rightsholder. Among other social benefits, the first sale doctrine has permitted libraries, used bookstores, and used record stores to operate without having to consult with a rightsholder each time they lend or sell a work.
 
 

How the Digital Age is Different


The content industry fears that fair use and first sale in the digital age will cause them to lose significant control over their copyrighted content, threatening their profits. Because a digital work is so easy to copy, many rightsholders fear that fair use will provide a loophole for individuals who wish to redistribute a work to others. They also fear that first sale will permit their first buyer to redistribute a work for free, ruining the rightsholder’s market and destroying authorship incentives. These fears have been the rationale stated by the content industry in their attempts to press for legislation which would virtually eliminate fair use and first sale in the digital world.

Here we will deal with two problems with the content industry’s position: (1) that in the past they have raised the specter of massive financial loss due to copying, yet history has proved their fears groundless; and (2) that even if the content industry faces loss of control in the digital age, the legislative remedies they are pushing would result in an immense loss for the public, and tip the delicate balance of copyright law firmly on the side of the content industry.

When home videorecorders were first introduced in the United States in 1975, the content industry feared that these would be used for massive copyright infringement. In 1976 key members of the content industry (Walt Disney Productions and Universal City Studios) filed suit in US District Court requesting an injunction against the manufacture and marketing of Betamax videorecorders. They contended that these machines would cause them significant financial harm because individuals could use them for copying their intellectual property. A series of litigation followed, culminating in a 1984 U.S. Supreme Court decision (Sony Corporation of America et al. v. Universal City Studios, Inc. et al.). This landmark decision recognized home videorecording as a fair use, and allowed Sony to continue marketing the machines (Bettig, Home Recording Rights Coalition, Marlow, Lardner).

In the course of litigation, representatives of the content industry strongly supported the Universal/Disney position. Jack Valenti, President of the Motion Picture Association of America, called the Betamax a "parasitical" device (Lardner, page 115). He claimed that VCRs posed significant threats to the film industry’s markets:

With 20 years of hindsight we can look back and see that none of these dire predictions have come true: the cable television industry is financially healthy, television advertising revenues haven’t tumbled, and movie theaters still attract a healthy business. Ironically, the studios that tried to prevent the use of home videorecorders now make almost half their income from rentals and sales to the home video market that they had previously sought to eliminate as a threat to their profits.

In the past two years, legislators shaping intellectual property law for the digital age have heard vociferous testimony from the content industry concerning their fears of tremendous revenue losses unless copyright laws are tightened. Most of the proposed legislation has responded directly to these fears in ways that will effectively eliminate fair use and first sale in the digital age. Public interest coalitions (including libraries, educational institutions, and consumer groups) have asserted that legislation in the digital age should maintain the kind of balance between rightsholders and the public interest that existed with analog material, rather than tip this balance significantly towards the content industry. Attempts to remedy perceived threats to rightsholders’ profits create severe threats to public interests that have traditionally been protected by fair use and first sale.

Fair use is a powerful tool for both education and social commentary. This concept allows teachers to present small portions of a work for class discussion, and reviewers to quote from a work without obtaining permission from the rightsholder. Fair use also permits the parody of a work, fostering content creation. The elimination of fair use would not only hurt education and social welfare, but could stifle the very creativity and content production that copyright was intended to foster. It would also drastically alter the delicate balance between rightsholders and information users.

Attempts to eliminate the first sale doctrine in the digital age raise even more critical issues. A key aspect of first sale has prevented the rightsholder of intellectual property from completely controlling who has access to it and how it is used. Though a publisher, newspaper, or Hollywood studio in the analog world might limit the audience for an initial set of sales, someone buying the work could turn around and sell it to anyone else. But in proposed digital age legislation, the purchaser of a work could not legally sell it or give it away without permission from the rightsholder. In a world without first sale:

The proposed elimination of fair use and first sale for digital material will gut much of copyright’s ability to promote the public interest, turning it into a vehicle that guarantees economic rights to copyright holders. This would continue a trend to increasingly favoring rightsholders over consumers and the public good.
 
 

What Has Copyright Become?


The framers of the US Constitution envisioned intellectual property law as guaranteeing a set of temporary monopoly rights to individuals -- "authors and inventors" to encourage the production of new works. Intervening economic changes have created the current situation in which individuals who create intellectual property have not had the resources or channels of distribution to disseminate their creations. Today, most creators have little choice but to sell their copyright to corporations who then disseminate these works. (For example, an individual author might have a hard time financing the printing of his/her book, but even if able to do so, s/he would not be able to distribute copies to bookstores without a major publisher or distributor. So the author is forced to sell the copyright to a publisher in exchange for printing, distribution, and a small portion of the profits.) For the most part, copyrights are not held by individuals, but by corporate entities who are part of the content industry. The content industry would argue that strengthening their position allows them to provide greater incentives to individual creators, but many creators vociferously challenge that notion (Tasini). Strengthening copyright laws does improve the position of the content industry by giving them a relatively untempered monopoly over content, but it does so at the expense of the public good. And it does little to encourage the creation of new content.

Proposed legislation that would turn copyright laws into economic guarantees for the copyright holders is just the most recent in a series of attempts by the content industry to tilt the balance in their favor. If content providers have their way, intellectual property use will move away from domains that have at least some provision for public good and social benefit (such as fair use and first sale) -- and move these dealings into arenas where only economic relationships apply.
 
 

"Limited Time"


The "limited time" duration of copyright was instrumental in ensuring that the law promoted the creation of new works, rather than the extraction of profits from content. The duration of a copyright guarantee has increased over time (see chart A). A 1709 law set copyright for 14 years. Prior to 1976, copyright was granted for 28 years and renewable for another 28 years. The 1976 Copyright Act increased the term to 75 years, and the 1998 Millenium Copyright Act increased the term still further -- to 95 years for corporations and 70 years after death for individuals.
 
Year Copyright Duration
1709 (British) 14 years
pre-1976 (US) 28 years + 28 year renewal
1976 (US) 75 years (corporate)

life + 50 years (individual)

1998 (US) 95 years (corporate)

life + 70 years (individual)

Chart A: Copyright Duration

This lengthening of copyright duration flies in the face of the Constitutional limitation on copyright which granted Congress the right to institute copyright protections, but only for limited times. The Constitutionally mandated goal of copyright is to encourage the production of new works, both by guaranteeing creators some exclusivity for a limited time, and by making sure that there is a robust public domain of copyright-free material that creators can draw on and incorporate into new works. It is absurd to think that 75 or 95 years is a "limited time", and even more absurd to rationalize that exclusive rights lasting beyond one’s lifetime would provide incentives that would encourage a creator to create more works.

In a February 1998 editorial, the New York Times (itself a major content-holder that benefits from strong copyright legislation) strongly criticized proposed extensions of copyright duration.

...Supporters of this bill, mainly the film industry, music publishers and heirs who already enjoy copyright revenues, argue that extending copyright will improve the balance of trade, compensate for lengthening life spans and make American protections consonant with European practice. But no matter how the supporters of this bill frame their arguments, they have only one thing in mind: continuing to profit from copyright by changing the agreement under which it was obtained.

There is no justification for extending the copyright term. Senator Orrin Hatch argues that the purpose of copyright is "spurring creativity and protecting authors." That is correct, and the current limits do just that. The proposed extension edges toward perpetual patrimony for the descendants, blood or corporate, of creative artists. That is decidedly not the purpose of copyright.

Copyright protects an author by granting him the right to profit from his own work. But copyright also protects the pubic interest by insuring that one day the right to use any work will return to the public. When Senator Hatch laments that George Gershwin’s "Rhapsody in Blue" will soon "fall into the public domain," he makes the public domain sound like a dark abyss where songs go, never to be heard again. In fact, when a work enters the public domain it means the public can afford to use it freely, to give it new currency.

...[T]he works in the public domain, which means nearly every work of any kind produced before the early 1920’s, are an essential part of every artist’s sustenance, of every person’s sustenance. So far Congress has heard no representatives of the public domain. It has apparently forgotten that its own members are meant to be those representatives.
(NY Times, February 21, 1998 editorial)

Lengthening of copyright duration is particularly onerous in the context of other attempts to assert copyright over material either already in the public domain or about to enter it. Corbis Corporation (a digital image stockhouse wholely owned by Bill Gates) contends that when they digitize an image of an art work or photograph, their digitization creates a new copyright which will persist for the duration of copyright protection beginning with the date of digitization. If their contention that digitization is a substantial creative act is upheld by the courts, it will mean that the digital version of works already in the public domain will remain under copyright protection for an additional 95 years.

Proposed database extraction legislation would apply copyright to an entire database, and start the copyright duration clock ticking every time a new item was added to the database. Under the proposed legislation, every time an online collection of text or images added a new work to their database, it would extend the copyright duration term for anything that was extracted from their database. This would allow a database provider to create a perpetual copyright (by adding something new to the database every 90 years), preventing items in the database from ever entering the public domain. This legislation died in the 1998 Congress, but will be reintroduced in 1999 with strong backing from the content industry.
 
 

Recent attempts to overhaul the copyright law have been prompted by strong lobbying efforts from the "content industry". The content industry was one of the leading supporters of Clinton’s first campaign for the presidency, and after taking office Clinton appointed former copyright industry lobbyist Bruce Lehman as Assistant Secretary of Commerce and Commissioner of Patents and Trademarks. Lehman was given the task of managing efforts to overhaul the nation’s intellectual property laws, and he was the driving force behind the Administration’s green paper and white paper recommendations on major changes to intellectual property laws (Samuelson).

As copyright legislation was passing through Congress, content industry lobbyists aggressively courted Congresspeople. The Association of American Publisers hired former Congresswoman Pat Shroeder to head their organization and act as chief spokesperson. In the 1996 election, the content industry had already donated over $11 million to congressional campaigns, split fairly evenly between Democrats and Republicans (Makinson). In the early part of the 1998 campaign (while copyright legislation was being debated in Congress), Hollywood connected donors gave more than $1.3 million to congressional campaigns (Mother Jones 400). The content industry also waged a strong public relations campaign, claiming that the American economy would suffer irreparable harm if copyright controls were not tightened. After the Digital Millenium Copyright Act finally passed through Congress, an Associated Press story revealed that Disney had lobbied hard for the new law (particularly portions which extended copyright protection for an additional 20 years) because Disney’s copyright over characters such as Mickey Mouse, Goofy, and Donald Duck were due to expire soon (Salant). Not surprisingly, a week after the Digital Millenium Copyright Act was signed into law, Bruce Lehman resigned his Administration post, having accomplished most of what he set out to do on behalf of the content industry.
 
 

Licensing


For the past decade, most publishers have refused to sell material in digital form to libraries. Instead, they require libraries to license this material. Licenses are contractual arrangements, and publishers claim that rights such as fair use do not apply to these arrangements.

Under licensing schemes, material is leased rather than bought outright. This raises a myriad of concerns for libraries. Licenses are only for a limited number of years, and at the end of that period license fees may be raised drastically or, if the market isn’t large enough, the material may be eliminated altogether. The licensor may eliminate particular items for economic reasons or because they are controversial, making it very difficult for a library to build collections or to maintain a historical record of the resources they have made available.

Site licenses of digital works of art can cause particular problems for faculty and students who build curricular or creative materials that incorporate these works. Faculty and students are hesitant to spend the extensive time needed to create new digital materials incorporating licensed digital images unless they can be sure that the campus license (and each individual image that was originally part of it) will continue in perpetuity, and that they can take their creations with them when they leave the campus. Faculty sabbaticals at another campus, faculty or students taking positions elsewhere, or even showing a portfolio to a potential employer would all be prohibited by most licensing agreements. This is a central problem to any type of licensing agreement; if a licensor did in fact choose to offer guarantees of continuity, that licensor would run the risk of a university deciding to cancel their license payments yet still maintain the continuity of access.

Licensing material in digital form can also raise privacy concerns. A recent trend in university licensing of digital material is for members of the university community to access that material directly from a central site maintained by the publisher, rather than from a local site mounted by the university. This type of architecture requires that each individual be identified to the publisher as a valid member of the licensed university community. This approach carries the potential for dangerous violations of the privacy that university researchers have come to expect. Libraries carefully guard circulation information, and many purposely destroy all but aggregate statistics to avoid having to respond to law enforcement agencies seeking an individual’s reading habits. It is extremely unlikely that publishers will provide this kind of privacy protection. Today a large number of websites monitor the browsing that goes on at their site, tracking who is looking at what, how often, and for how long. A whole industry has emerged that purchases this kind of personal marketing information from site managers and resells it. In difficult financial times, even licensors who are committed to privacy concerns may find the temptation of payment for this kind of information difficult to resist.

Another key concern for libraries is the way in which licensing digital information will affect interlibrary loans (ILL). Due to consolidation in the publication industry, scholarly journal subscription costs have skyrocketed in recent years (Guernsey, Case, McCabe, Wyly). The only way that libraries have been able to respond to this is by developing cooperative purchasing agreements with other nearby libraries. But most licensing agreements for journals in electronic form prohibit ILL or any other form of access outside the immediate user community. Licensing has the potential of not only destroying libraries’ recent response to the crisis of the rising cost of serials, but it may also destroy their historic cooperative lending practices. Libraries, which have traditionally cooperated to guarantee that users of even the poorest library could employ ILL to borrow materials that their library could not afford to purchase, are likely to find themselves prohibited by licensing agreements from engaging in ILL.
 
 

Intellectual Property Law Used to Suppress Creativity and Free Speech


The increasing use of licensing schemes to avoid domains (like fair use) where the public good must be taken into consideration is part of a larger recent trend where commercial transactions take precedent over what used to be regarded as public rights or part of the public good.

In recent years, libel laws have been used to try to suppress criticisms that have been traditionally protected by free speech. These lawsuits, filed by corporate entities against individuals who have criticized them, have laid the burden of proof upon the defendants, forcing them to prove that all their criticisms were true. In 1998 Oprah Winfrey won an expensive court battle defending herself against a $12 million lawsuit. The lawsuit, filed by the cattle industry under a recent food disparagement law, challenged statements Oprah made on her television talk show about the health of eating beef. According to the New York Times, "critics say that they [recent food disparagement laws] are a serious infringement on free-speech protections and are driven by business interests intent on silencing journalists and others who question the safety of the American food supply"(Verhovek). In a similar case in Britain, McDonalds sued activists from London Greenpeace who had created a leaflet urging consumers to boycott McDonalds for a host of reasons (ranging from health to working conditions to the effects of cattle raising practices on tropical rainforests). In this long-running "McLibel" case, the defendants were forced to prove each of the accusations they had made in their leaflet (Vidal).

Many groups within our society use the threat of copyright infringement litigation to avoid criticism or suppress works that they disapprove of. As the cases listed below show, limitations to the fair use defense against copyright infringement can result in the elimination of parody and satire, the curtailment of free speech, or the suppression of creativity, particularly in the form of new artistic styles:

The cases listed above all transpired under previous versions of copyright law. Current legislation which would further limit or eliminate fair use carries with it the danger of limiting free speech, curtailing satire and parody, and suppressing new art forms to an even greater degree than existed when the above battles took place. The discourse over copyright legislation is dominated by discussion of "economic harm" that will come to the content industry if action is not taken. The harm to the public good that will come from further limitations on fair use is treated merely as a minor side-effect. As Negativland wrote in a 1993 issue of Billboard: The prevailing assumption — that our culture, and all its cultural artifacts, should be privately controlled and locked away from any and all further creative uses by the audience they are directed at — is both undesirable and unworkable. Uninvited appropriation is inevitable when a population bombarded with electronic media meets the hardware that encourages people to capture those media. However, laws devised to protect the "ownership" of transmittable information have, for example, resulted in a music industry in which the very idea of a collage is a dangerous one, and artists inspired by "direct reference" forms of creation do not have the "right" to decide what their own art will consist of. Has it occurred to anyone that the private ownership of mass culture is a bit of a contradiction in terms? (Negativland, p 154)
Conclusion


Fair use and first sale are deeply intertwined with a value system that emphasizes access to information over privatization of information. These concepts promote democratic values such as political critique and satire, equal access to information for education, and the diversity of creativity that comes from letting less powerful societal voices develop new art forms that comment upon older ones.

In recent years we have seen a veritable assault on fair use and first sale — from bullying threats of litigation, to court cases, to harsh legislation. The content industry is not only trying to reshape copyright from a public good into an unlimited economic right, but they are even trying to expand their rights into new arenas where these can be used to suppress criticism.

The content industry has complained vociferously about potential economic harm, yet their assertions run counter to a variety of examples which raise questions as to whether they will be harmed economically: The Netherlands has a much more liberal policy than fair use, allowing individuals unlimited reproduction of copyrighted material for their own private use; and the content industry still operates profitably within the Netherlands. As the effects from the Betamax court case show, technological changes initially perceived as economically threatening can lead to the discovery of new economic models involving income streams that exceed the ones previously "threatened". And as the software industry has shown, lowering prices not only provides a great deterrence to copyright infringement, but can open up new markets of potential customers.

But the most devastating impact from these recent changes is the likely transformation of information into a consumer product. There has always been a distinct set of differences between information and commodities. (For example, if I sell or give someone a toy, I no longer have it; but if I sell or give them information I still retain it.) The law has recognized this difference by treating intellectual property differently than tangible property. As the law is changing to eliminate the public good aspects of intellectual property, we are seeing a rapid increase in the commodification of information. The area of authorship and creativity will increasingly resemble the world of consumer products — intellectual property will become more bland and corporate controlled. Most individuals will find it more and more difficult to become a creator, and will settle for being merely a consumer. And diverse voices will be more and more marginalized. As Negativland wrote in the Epilogue to their book, "We are suggesting that our modern surrender of the age-old concept of shared culture to the exclusive interests of private owners has relegated our population to spectator status and transformed our culture into an economic commodity." (Negativland, p 190)
 
 

Acknowledgements


Much of the content of this paper was delivered as a talk to the February 1998 Toronto Town Hall Meeting on Copyright and Fair Use (sponsored by the Samuel H. Kress Foundation and the College Art Association), and also at the June 1998 San Francisco meeting of the Union for Democratic Communications. A shorter version of this article also appears in  Peace Review Journal  11:1 (March 1999), and in a publication of papers from the Town Hall Meetings on Copyright and Fair Use.

Karen Gracy provided research assistance on this chapter. Aaron Good helped wade through the Millenium Copyright Act, and he and Jenny Louie provided insight to these ideas from a public policy perspective. Michael Levy and Karen Coyle arranged forums where the author was able to test these ideas with an audience of librarians. The College Art Association provided assistance in articulating these ideas for an audience of art history scholars. Conversations with Melissa Smith Levine, Mary Levering, Sam Trosow, and Pam Samuelson, as well as participation in the National Research Council’s panel on Intellectual Property helped the author better understand many of the legal concepts. Katherine Falk provided editorial assistance.
 
 

References