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Today we’re going to take a field trip to the sausage factory. And by “sausage factory,” I mean the place that laws get made in the United States: Congress, aka the legislative branch. I have some direct experience here. As a former artist advocate, I was not representing a specific industry—I helped advance the perspective of creators but always took a holistic view of the many interests at play, including those of fans. For better or worse, I was until recently intimately involved in current deliberations around updating the U.S. Copyright Act.

Copyright reform would likely happen in two core areas: licensing and enforcement. The latter is something Congress may find difficult to address in the wake of the Stop Online Piracy Act (SOPA) controversy. That proposed bill, along with its Senate companion, the PROTECT-IP Act (PIPA), resulted in a massive blowback that its drafters and co-sponsors failed to anticipate. Both pieces of legislation dealt with the enforcement of intellectual property—specifically the so-called “rogue sites” overseas that traffic in ill-gotten American IP for profit.

From a standpoint of creators’ rights, it is hard to disagree with the idea of parties having better tools to combat infringement in parts of the world that do not recognize our laws or particularly respect them. Yet SOPA, in particular, contained provisions that seemed to go beyond the stated goal of the bill.  The drafting of this bill was a closed process, with little to no input from anyone other than the industries seeking relief. The motion picture industry, in particular, was very much invested in SOPA. Whereas the Senate bill, PIPA (and its predecessor, COICA), had gone through many revisions to tighten legal definitions and establish safeguards, SOPA was born one day and rammed through committee the next.

In retrospect, I can recognize that its sponsors did strip out some of the more controversial provisions, but it was very late in the game and only after a massive Internet protest resulted in offices getting besieged with phone calls. This seems to me to be more of a failure of process than policy, as I can tell you that there are not many US creators who would oppose efforts to protect their rights from being exploited for profit without permission and with incredible volume and sophistication by foreign entities. But some of those creative people may have issue with specific provisions if they had an opportunity to become aware of them. For example, artists aren’t particularly interested in government restricting speech. The idea of huge entertainment companies being able to direct the federal government to block access to websites no questions asked is troubling. It also sends an unwelcome message to the world: the United States is perfectly fine with filtering the Internet.

SOPA and PIPA contained other remedies that weren’t as egregious, and may have actually been helpful in addressing the issue. One provision that enjoyed broader support was the idea of  “going after the money,” meaning that a rogue site could have its ability to process payments or deliver ads shut down. Unfortunately, after the massive protests, Congress decided that it didn’t want to go down this road again. So basically, the overreach of the major content companies ended up eliminating their best chance to get something passed. Since then, the government has taken a different approach to copyright enforcement—one of multi-stakeholder convenings and voluntary agreements. The results of this process include industry accepted “best practices” for payment processors (think credit cards and PayPal), and online ad networks (think AdSense), both of which have found themselves embroiled in some controversy over facilitating transactions on pirate sites. For the most part, the executive branch Office of the Intellectual Property Enforcement Coordinator has presided over these voluntary agreements. They aren’t actual laws, but rather a way for various sectors to come together to solve specific problems. Of course, since these aren’t actual legally enforceable policies, they’re only as good as the companies’ interest in upholding them. They also lack a clear means of oversight to prevent abuses. Still, they are a welcome alternative to the closed-quarters sniping and influence jockeying of SOPA.

But that’s just enforcement. When it comes to enabling the market for creative works to function better in the digital age, you do need actual laws. And that’s why Congress has started to take a look at updating federal statute. This was in part teed up by the Copyright Office, which is part of the Library of Congress. Following a Columbia Law School address outlining ways the Copyright Act could be updated to address current and emerging technologies, US Copyright Office Register of Copyrights Maria Pallante was invited to share her thoughts directly with the Subcommittee. In her testimony, Pallante outlined several areas in need of review, and emphasized that the needs of creators and the public shouldn’t be at odds. From there, we’ve seen numerous hearings within the House Judiciary Committee (here’s a handy timeline), where members of Congress ask questions of expert witnesses from a whole host of different sectors that involve copyright. I was a witness at one of the hearings last year. It was certainly interesting.

The federal agencies have also been seeking public comments on a range of issues having to do with intellectual property and technology. The United States Patent and Trademark Office (USPTO) has joined forces with the National Telecommunications and Information Administration (NTIA) on a “green paper” that examines everything from notice-and-takedown protocols to remix culture. We’ve participated in several of the public inquiries and working groups. For its part, the Copyright Office has chosen to focus on music licensing, which seems to be follow-through from Register of Copyrights Maria Pallante’s earlier statement that “if we can get music licensing right, the rest of the Act will fall in place.” This has led to a number of dockets where groups and individuals can file comments on specific questions, as well as in-person roundtables (in which I have also participated).

So, in general it looks to me that what is described in Professor Litman’s book is very much in line with the current process. While I am glad to be a part of these developments, it does underscore the basic fact that not everyone who is impacted by copyright law is at the table. In fact, from my experience, I can say that most of the conversations are still dominated by industry, be it entertainment or technology. And make no mistake about it: these sectors are in business with one another. The disputes are real, but they are to some extent superficial. At the end of the day, terms must be reached in order to make money. However, there isn’t a lot of attention paid to how any of this impacts creators beyond lip-service. And that’s why I am glad to be involved. I would never in a million years claim to speak for all artists, because research from my former organization, the Future of Music Coalition, has long shown that creators aren’t a monolithic group. However, I can raise the issue of how their ability to sustain careers in their respective vocations is essential to a healthy 21st century creative ecosystem. It is a truism that policy is made by those who show up. And there is still a major gap between those who drive policy and those who are affected by it.

I want to hear your views on what outcomes are the most important to achieve, keeping in mind that the beneficiaries described in the US Constitution are creators and the public. I’d also like your perspective on how to establish a global framework for copyright and technology, given the porousness of digital networks and their global reach.

Have a blockbuster strategy.

Also have a non-blockbuster strategy.

It’s interesting, isn’t it? Obviously, the greater percentage of content creators or entertainment entrepreneurs have a non-blockbuster strategy simply because they do not have access to the resources that it takes to pursue the alternative.

In this light, we can see that the ideas of “convergence” and “consolidation” in the new content and distribution environment has a real impact on who gets to play. In some ways, the problem is endemic to the digital environment. Which is to say, we’ve always had blockbusters, but the increase in “noise” due to disintermediation means that the companies with the capital to pursue hits will do so more aggressively and with almost singular attention.

Yet the “blockbuster” concept at its simplest is really just risk vs. return on investment (ROI) on steroids. Smaller entities may pursue analogous strategies, albeit with fewer resources and options to achieve similar scale. But perhaps scale isn’t the goal. This is why when we’re talking about copyright or access to communications platforms or even rights protections, it is important to keep in mind that not everyone aims for mass market saturation. Yet these smaller enterprises may still pursue risk and ROI according to a similar dynamic: they invest more in the product/talent that produces the most reward, and they cross-collateralize risk among other properties that may not bring comparable dividends.

Conversely, we see major entertainment studios maintaining some level of investment in smaller projects, for any number of reasons—research and development for potential franchises, vanity or critic-centric vehicles for established talent, or niche offerings that appeal to reliable, but smaller demographics.

What is clear is that, while the bigger players get to have a non-blockbuster strategy, the smaller operators do not get to have an “all-in” approach, even if they do calculate risk according to a similar, albeit scaled down formula.

These days, it is not uncommon for part of the blockbuster strategy to include investment in low-cost, low-return media (like YouTube channels and niche web properties) in order to ascertain the popularity or virality of a product in order to integrate it into higher budget offerings. We see this a lot in comedy, a certain amount in television, and to some extent, music.

However, this is still a lottery system for many creators whose offerings aren’t likely to inspire millions of clicks or views, but may nonetheless be worthy in terms of artistic expression, aesthetic or message. What many are wondering is where investment comes from, outside a fan patronage model where success may not be replicable from project to project. Perhaps that’s the best that we have in a noisy and crowded media marketplace.

Today, I would like to discuss how the consolidation of media and vertical integration of distribution/access impacts how we create and consume media. We should also examine the positives and negatives of the blockbuster strategy, and discuss how various content creators might approach the risk vs. ROI equation.

Today, we’re going to explore the idea of “convergence” in the communications, media and technology industries. We will attempt to imagine what comes after the next consolidation as part of Professor Wu’s “cycle,” as described in The Master Switch. (For our purposes, we will allow for the validity of this theory.)

The Master Switch puts the spotlight on AT&T, and for good reason: the company goes back a long way and plays an outsized role in the history of American communications and public policy. In the 1890s, AT&T used patent law to its advantage to preserve its dominance in the telegraph industry. From there, the company enjoyed light-touch regulation through the 1980s, and even after its original monopoly was broken up, AT&T continued to have tremendous sway in the marketplace. In the early days, regulatory permissiveness was seen as a positive. In the words of President Harry Truman, AT&T was in a position to “render an exceptional service in the national interest.” To some extent, this interest was obliged.

Except for those times when it wasn’t. In 1934, AT&T prevented the answering machine from entering the marketplace, even though this innovation was a product of its own Bell Labs. That’s potentially a consumer harm, but what about warantless wiretapping? To many observers, the latter is a strike against liberty itself.

Each communications technology seems susceptible to Professor Wu’s cycle. Radio, which AT&T also had a hand in shaping, offers insights into the accessibility of a medium—its social, cultural or civic benefits, as well as the underlying business models that enable or frustrate access. These comparisons are useful even when we’re talking about the Internet.

The Internet is currently more hybridized than what radio ultimately became, but that doesn’t mean that what we experience in today’s online realm is going to be what the ‘net looks like tomorrow. Recall radio’s early, advertising-free days, where amateurs and hobbyists experimented with the technology according to their individual and community interests. Much like the Internet, these early participants believed in the transformative nature of the medium. As Waldemar Kaempffert, editor of Scientific American, once said, “all these disconnected communities and houses will be united through radio as they were never united by the telegraph and telephone.” That language will sound familiar to anyone who has spoken to an Internet evangelist.

Sometimes, there are individuals in government who resist the corporatizing of communications, such as then-US Commerce Secretary Herbert Hoover, who pushed back against AT&T and the radio manufacturers as they sought to bring advertising to the airwaves. The courts took another view, initiating the next phase of Professor Wu’s cycle.

In Wu’s words: “History shows a typical progression of information technologies… from somebody’s hobby to somebody’s industry; from jury-rigged contraption to slick production marvel; from a freely accessible channel to one strictly controlled by a single corporation or cartel — from open to closed system.”

I want you to consider what this means for today’s technologies and creative industries. What phase of the cycle are we in? Perhaps the phases cannot be neatly described, as they involve aspects of previous stages. It is also possible that understanding which phase we are in is not possible from a contemporary vantage point, but rather requires the benefit of hindsight.

Nonetheless, it seems clear that “convergence” in communications industries can create real dangers.  AT&T’s size put it in a position to conduct wide-scale wiretapping, admittedly with government encouragement or coercion. That happened at the end of the Bush administration, but digital surveillance has been further perpetuated by the NSA and certain large Internet Service Providers.

Content is also a huge piece of the puzzle, which is why many large communications and information technology companies are keen to exert a “buyers’ monopoly” over content distributors, or, in the case of the Comcast-NBC/Universal merger, purchase an entertainment studio outright.

If the cycle is real and convergence inevitable, the only remaining question is to what extent government can or should do anything about it.

Intervention can be complicated. Especially when, as our earlier readings have illustrated, consolidated entertainment corporations are expert at pitting content producers (like authors or musicians) against their perceived enemies, such as technology companies. In my experience, industries that have built media empires on authors’ copyrights are all too eager to use creators as human shields in policy battles to preserve legacy advantages. But what happens when authors have to go up against the new distribution kingpins on their own?

On the other hand, technology companies often have little experience in dealing directly with creators (though this may be changing, with YouTube, Amazon and Netflix all producing or directly soliciting original content). However, it is unlikely that the market will sort everything out, and that means the government has to be involved. But on whose behalf? Corporations? The public? Creators?

As I’ve mentioned previously, the new convergence promises to dwarf previous cycles, because the internet has subsumed all earlier technologies—from film to television to telephone to broadcasting to music. This means that the biggest companies are even bigger than before, with tremendous influence and interests across a mind-boggling number of businesses.

Professor Wu astutely notes that “all power that derives from the control of information.” His views might seem superficially libertarian, but he does recognize that government must play a role.  “If we believe in liberty, it must be freedom from both private and public coercion,” he writes.

This could mean stricter antitrust or competition policy, or an update of the statute that regulators use to approve or deny mergers or punish corporations for monopoly behavior. In today’s political climate, this seems to be a tall order.

Which is why so many of us are fighting to preserve net neutrality. It’s the best shot we have at present to stave off the complete corporatizing of this network of networks, the Internet.

And remember, this network wouldn’t even exist were it not for government investment. The Internet, after all, began as a defense department project. The airwaves are held in a public trust and licenses are administered by the FCC, contingent on broadcasters’ upholding of certain public interest obligations.

Now I want to hear from you about where we are in the cycle. I also want to know what you think comes after, if convergence is inevitable.

Today’s discussion will examine communications technology as cultural infrastructure, with an eye towards how the costs of building out and maintaining this infrastructure can result in barriers to entry and a tendency towards monopoly. We’ll also look at closed systems vs. open systems and how the two modalities can inhibit or aid in the advancement of innovation and expression.

When it comes to the unfettered exchange of ideas, one can see openness as something almost humanitarian. Systems that facilitate unfettered information exchange between parties, especially networks with a high degree of participation, are seen as virtuous, while command-and-control structures are viewed with skepticism if not derision. This may be the reason why that, when new communications platforms emerge, there is often the view that the freedoms they represent at the outset will transform human potential. But this is only one phase of “The Cycle,” as Professor Wu describes it.

In any era, evangelists of emerging communications technologies often talk about how a given innovation will broaden access to culture and enhance our humanity. The telephone and radio were supposed to allow us to set aside the vulgar in favor of a more refined discourse—civic, cultural and otherwise. Participation in such exchanges would increase, creating a virtuous cycle that would usher us into a new age of connectivity and abundance. Early Internet evangelism is full of this kind of blue-sky thinking. And it’s an outlook that can still be found in today’s debates about technology.

One thing that does seem to be true: communications platforms with high barriers to entry have a tendency to limit the number of voices that get to be heard. Perversely, the more voices that can be heard don’t necessarily guarantee that they will be—noise seems to increase with the number of participants in a system, at least until they all gravitate around a strong signal. This is a hidden part of the network effect that makes mass participation in communications platforms highly valuable to those that can coral and direct consumers.

There is sometimes a strong incentive to preserving high barriers to entry. One reason may be that incumbent industries aren’t keen to entertain competition—even if that competition is indirect. There may also be perceived virtues. Under the guiding hand of a benevolent monopolist or state shepherd, a closed platform might be cultivated as a public service. Examples include Theodore Vail’s view of the AT&T’s telephone system. Another is the original BBC which retains a prominent role in shaping British culture. Such systems may avoid what Walter Lippman calls “fictitious demand for lower standards,” whereby corporations, often in thrall to advertising dollars, seek to sell more products to the broadest possible demographic of consumers by serving up the blandest and most homogenized content possible. This dynamic still can be seen in the Internet age. In fact, it’s key to how consolidated entertainment companies blaze a trail through a noisy commons, all the while courting virality.

Government controls come with their own sets of issues, including a tendency to censorship and propaganda, particularly among nations without strongly defined free speech traditions or democratic governance. But even democratic countries aren’t immune from the lure of control and influence when it comes to communications and information systems, as illustrated by the digital surveillance techniques within the US intelligence sector and the laws and statutes that allow for their expansion and abuse.

In America, the combination of money in politics and corporate consolidation of media may result in the worst of both worlds: one in which just a handful of companies wield tremendous influence over the entire communications apparatus, and their strongest brands advance a catechism of strict political perspectives. Throw in a government with a strong a national security imperative and you’ve got a perfect storm of potential dangers.

But total control is probably outside any one set of hands, at least for now. This is mostly due to the fact that the Internet remains an open platform. Of course, one has to have basic access and be able to afford to pay a service provider to get online.

And as is the case with earlier technologies at their point of emergence, the openness of the Internet has inspired an influx of so-called “amateurs” and tinkerers. And a critical mass of tinkerers can herald a paradigm shift that disrupts existing regimes. At least for a time.

There’s no doubt that amateurs often have stars in their eyes when it comes to their do-it-yourself innovations and discoveries. And their champions often place tremendous emphasis on a technology’s transformative potential. For its part, existing industry may react cynically to what they see as a ragtag community of hobbyists. This shortsightedness sometimes means missing out on opportunities to capitalize on emerging innovations. Other times, like with the music industry, they are blindsided by a technology that upends their ability to maintain scarcity to commercial advantage by controlling access and distribution.

Of course, somebody has to build the backbone of even open systems, and that requires investment. These costs can create barriers for anyone trying to enter the marketplace as a carrier. We see this with the Internet, which consists of an infrastructure layer and an information layer at its most simplistic. It’s probably impossible to be Comcast, but you still might be able to be the next Twitter (or at least something along those lines).  There may be inherent limits to how much competition can exist on the infrastructure layer, but openness on the information layer serves to attract new entrants that build platforms that in turn create network effects that add value to users and to those who charge to access the network. Whether a network operator is allowed to choose winners and loser among those who innovate and provide services on the top layer is at the heart of the net neutrality debate.

As we see with Vail’s AT&T, control of a system isn’t always a bad thing, although it typically results in a chilling of innovation—whether those innovations are internal or external. Remember, in addition to profits, monopolists seek efficiency, and sometimes that pursuit of efficiency does produce positive outcomes. But these days, it mostly seems to be about preserving security for investments, which has a tendency to eliminate alternatives, even those that may also benefit the public or open up new markets.

Monopoly can also inhibit expansion to less profitable demographics. Industry typically seeks to serve the moneyed portions of society, because it is the fastest and most reliable path to revenue. But in doing so, they may ignore the opportunity to tap into economies of scale that come from expanded access. With the right spur, often in the form of government incentives, companies that provide communications can be encouraged to bridge these divides. But it’s not easy, even in 2014.

As previously mentioned, communications and information infrastructure contributes to the public good, as it serves the basic human need of expression. There is clearly money to be made in serving that need, either in charging for access to the pipeline or through advertising or transaction-based structures (or a hybrid, which we see on the Internet). Government sometimes steps in to mediate tensions between the capital urge and altruistic necessity by placing certain obligations and limitations on those who operate the infrastructure. How far should these obligations extend, to which parties and under what conditions? This is what I want to hear from you.

Today we’re going to take a field trip to the sausage factory.

And by “sausage factory,” I mean the venue where laws get made in the United States, which is Congress. I have some direct experience here. Often, I consider my engagement to be along the lines of “observer status,” being that my organization isn’t representing a specific industry—we advocate from the creator perspective but take a more holistic view of the many interests at play in the broader cultural sector. Lately, however, I find myself acting as a representative for artists in the consideration and implementation of specific policies. This means that I am involved in most of the current deliberations about updating the Copyright Act that have to do with the music sector (and a surprising number of them do). Congress has limited appetite for diving into this morass, especially after the Stop Online Piracy Act (SOPA) controversy. That proposed bill, along with its Senate companion, the PROTECT-IP Act (PIPA), created tremendous controversy and resulted in blowback that its drafters and co-sponsors failed to anticipate. Both pieces of legislation dealt with the enforcement of intellectual property—specifically the so-called “rogue sites” overseas that traffic in ill-gotten American IP for profit.

Generically, it is hard to disagree with the idea of providing law enforcement and the creative industries with better tools to combat infringement in parts of the world that do not recognize our laws or particularly respect them. However, the legislation—especially SOPA—contained troubling provisions that seemed to go beyond the stated goal. Having been privy to discussions around these bills since an earlier Senate version, I witnessed something troubling with regard to the later House legislation (SOPA). The latter was a closed process, with little to no input from anyone other than the industries seeking relief. The motion picture industry, in particular, was very much invested in SOPA. Whereas PIPA (and its predecessor, COICA), had gone through many revisions to tighten the legal definitions and recourse, SOPA was born one day and rammed through committee the next.

In retrospect, I can recognize that its sponsors did strip out some of the more controversial provisions, but it was very late in the game and only after a massive Internet protest resulted in offices getting besieged with phone calls. This seems to me to be more of a failure of process than policy, as I can tell you that there are not many US creators who would oppose efforts to protect their rights from being exploited for profit without permission and with incredible volume and sophistication by foreign entities. But some of those creative people may have issue with specific provisions if they had an opportunity to become aware of them. For example, artists aren’t particularly interested in government restricting speech. The idea of huge entertainment companies being able to direct the federal government to block access to websites no questions asked is troubling. It also sends an unwelcome message to the world: the United States is perfectly fine with filtering the Internet.

SOPA and PIPA contained other remedies that weren’t as egregious, and may have actually been helpful in addressing the issue. One provision that enjoyed broader support was the idea of  “going after the money,” meaning that a rogue site could have its ability to process payments or deliver ads shut down. Unfortunately, after the massive protests, Congress decided that it didn’t want to go down this road again. So basically, the overreach of the major content companies ended up eliminating their best chance to get something passed. Since then, the government has taken a different approach to copyright enforcement—one of multi-stakeholder convenings and voluntary agreements. The results of this process include industry accepted “best practices” for payment processors (think credit cards and PayPal), and online ad networks (think AdSense), both of which have found themselves embroiled in some controversy over facilitating transactions on pirate sites. For the most part, the executive branch Office of the Intellectual Property Enforcement Coordinator has presided over these voluntary agreements. They aren’t actual laws, but rather a way for various sectors to come together to solve specific problems. Of course, since these aren’t actual legally enforceable policies, they’re only as good as the companies’ interest in upholding them. They also lack a clear means of oversight to prevent abuses. Still, they are a welcome alternative to the closed-quarters sniping and influence jockeying of SOPA.

But that’s just enforcement. When it comes to enabling the market for creative works to function better in the digital age, you do need actual laws. And that’s why Congress has started to take a look at updating federal statute. This was in part teed up by the Copyright Office, which is part of the Library of Congress. Following a Columbia Law School address outlining ways the Copyright Act could be updated to address current and emerging technologies, US Copyright Office Register of Copyrights Maria Pallante was invited to share her thoughts directly with the Subcommittee. In her testimony, Pallante outlined several areas in need of review, and emphasized that the needs of creators and the public shouldn’t be at odds. From there, we’ve seen numerous hearings within the House Judiciary Committee (here’s a handy timeline), where members of Congress ask questions of expert witnesses from a whole host of different sectors that involve copyright. I was a witness at one of the hearings in late summer. It was certainly interesting.

The federal agencies have also been seeking public comments on a range of issues having to do with intellectual property and technology. The United States Patent and Trademark Office (USPTO) has joined forces with the National Telecommunications and Information Administration (NTIA) on a “green paper” that examines everything from notice-and-takedown protocols to remix culture. We’ve participated in several of the public inquiries and working groups. For its part, the Copyright Office has chosen to focus on music licensing, which seems to be follow-through from Register of Copyrights Maria Pallante’s earlier statement that “if we can get music licensing right, the rest of the Act will fall in place.” This has led to a number of dockets where groups and individuals can file comments on specific questions, as well as in-person roundtables (in which I have also participated).

So, in general it looks to me that what is described in Professor Litman’s book is very much in line with the current process. While I am glad to be a part of these developments, it does underscore the basic fact that not everyone who is impacted by copyright law is at the table. In fact, from my experience, I can say that most of the conversations are still dominated by major industry, be it entertainment or technology. And make no mistake about it: these sectors are in business with one another. The disputes are real, but they are also to an extent superficial. At the end of the day, terms must be reached in order to continue to make gobs of money. But there really isn’t a lot of attention paid to how any of this impacts individual creators beyond lip-service. And that’s why I am glad to be involved. I would never in a million years claim to speak for all artists, because our research at Future of Music Coalition continues to show that creators aren’t a monolithic group. However, I can raise the issue of how their ability to sustain careers in their respective vocations is essential to a healthy 21st century creative ecosystem. And that’s what I try to do. Where we get into the weeds on specific laws that govern music, well, I have become pretty familiar with those ins-and-outs and am able to hopefully articulate viewpoints that echo what is and isn’t helpful for musicians and composers. But again, the idea is that policy is made by those who show up. And there is still a major gap between who drives policy and who is affected by it.

Today, I want to hear your views on what outcomes are the most important to achieve, keeping in mind that the beneficiaries described in the US Constitution are creators and the public.

Here are a few questions/jumping off points regarding Digital Copyright by Professor Litman for response in the comments field.

1. You are a member of Congress. You are in the process of drafting new copyright legislation. Who do you talk to for input?

2. The public is not a party to negotiations around copyright law, yet the Constitution indicates that they/we are stakeholders and beneficiaries. How can policymakers address and incorporate the public interest without further complicating what is already a laborious process of compromise and incumbent influence?

2. Previous comprehensive copyright legislation took decades to formulate and pass. How would you make the process of updating existing law happen more quickly?

Copyright law was not conceived to work within an Internet framework. Still, all of its basic provisions have been ported over to the network, and new limitations and exceptions have been crafted that can be seen as an attempt to deal with a technology whose basic design involves making instantaneous copies of information and distributing them across a vast universe of senders and receivers.

There are around six fundamental exclusivities in copyright that we will be encounter in our examination. When any expressive work is “fixed” in a “tangible medium,” whether it’s type on a screen, in a book, lyrics or notes on paper, a sound recording or a film, that work is automatically under copyright. At one point in decades past, the United States required registration of an expressive work to be considered protected under law. Now, copyright is automatic. Registration with the United States Copyright Office is necessary to give the owner the ability to sue for what’s called “statutory damages,” and, if infringement occurs, having the work recorded by the federal government is your best bet in terms of proof of ownership. But no matter what, the minute I hit record on ProTools, I own that copyright up until the time that I transfer my rights to a third party, such as a record label.

The 6 rights that attach to a work are:

1. The right to reproduce
2. The right to distribute
3. The right to make derivatives
4. The right to public performance (compositions, audiovisual, dramatic, choreography, etc.)
5. The right to display
6. The right to publicly perform sound recordings in digital transmissions 

One of the biggest challenges that policymakers face is that, if the registration of works are not compelled, how do we deal with the influx of creative expression that is generated by humans using the newly democratized tools of production? We’re talking Garage Band recordings, user-upload videos, self-published fiction, blog posts and status updates, to say nothing of the remixes, mash-ups and memes that are so common to our online existence, but which come with a great many legal questions of their own.

In years past, the way that copyright law was shaped involved bringing stakeholders together to hammer out the details and compromises necessary for copyright-centric industries to do business with one another. Although Article 1, Section 8 of the United States Constitution clearly provides for a public interest in copyright, there has historically been little deference paid to the needs of society with regard to updating the laws that govern expressive works.

Copyright law is highly iterative, and federal policy mostly a matter of who is at the table during those extended periods in which legislation is crafted. For example, the last comprehensive update to American copyright law was passed in 1976. The Librarian of Congress and the Copyright Office began consulting with stakeholders as early as the mid 1950s. So these things have typically taken a while. But it’s safe to say that those present in shaping the 1976 Act had no inkling of the Internet. They simply could not have conceived of an era in which the average person had a networked computer/photocopier in their front pocket. The idea would have been impossible for anyone but science fiction writers to imagine, and most of them didn’t. Yet this has become our reality.

When we think about which parties benefit from copyright law, we now must consider a more broad set of stakeholders who have historically not been privy to policymaking in this area. Users of the Internet—which is pretty much everyone—are now part of the picture, as are the many different varieties of creator who don’t conform perfectly to earlier ideas of professional or amateur, and whose creative expression isn’t inherently a market-focused endeavor.

Today, I want us to discuss the six exclusivities in copyright in order to unpack their practical application on the Internet and off, as well as how these rules impact what is and isn’t possible in the marketplace of ideas.

I also want to touch upon the balance implied in the United States Constitution, and how best to honor the public interest and the incentive for creators in our both our copyright laws and consumer attitudes.

Today we’re going to discuss the concept of “free culture,” and what it means in terms of technology, the cultural commons and the commercial marketplace.

The free culture “movement,” if it can be described as such, is an offshoot of the free software movement, in which developers and computer engineers recognized quite rightly that networked technology offered new opportunities for collaboration and problem-solving. Provided, of course, that there weren’t artificial barriers placed on knowledge-sharing. This idea ran counter to the old way of doing things, in which systems were proprietary, information tightly guarded and the evolution of software or programs managed by a select few, according to a top-down corporate hierarchy and decision-making apparatus. Astra Taylor’s book references Linus’ Law, which states “given enough eyeballs, all bugs are shallow.” This basically means that if you’ve got enough people examining open-source code, problems with the program are more efficiently solved.

Of course, even in information technology fields, there are some programs or processes that are resistant to this dynamic. I’m not sure that the NSA would want to make its tech open-source, but I am sure they are keen to observe and exploit developments in the open source movement. Still, for the broader engineering and developer community, the open-source approach has paid dividends and kept the innovation train moving forward.

Obviously, many of the folks involved in the early Internet revolution had some strong opinions about their how their open-source construct could work in other sectors, including the music industries. As the movie Downloaded illustrates, however, there’s a bit of a gap between capitalizing on new modes of distribution and the idea that just because creative information can be easily shared, that it should be free. Much of the frustration that consumers experienced at the time was the fact that the major labels had almost total control over distribution and were therefore able to exploit this near-monopoly to set high prices based on scarcity. If you wanted a hot new album, up until the advent of CD-burning and Napster, the only way to easily get your hands on it was to go to the record store and pay up to 20 dollars US for a copy. The major labels even killed off the singles market, because they knew that it was better for their bottom lines to force people to pay premium prices for an album bundle, even if they really only wanted to hear the one hit. Obviously, this approach was radically altered by the arrival of iTunes, which “decoupled” songs from the album-based unit and let fans purchase tracks at a fixed 99-cent price point. But that’s a little bit of a diversion from today’s inquiry.

The frustration felt by consumers was shared by those guiding the evolution of the emerging Internet ecology. Both sides had legitimate gripes about the “old way” of doing business, though some of the common justifications for, say, peer-to-peer filesharing ring hollow here in 2014. For example, in the early 2000s, it was common to hear that filesharing didn’t really harm musicians because labels just rip off the artists anwway. While it’s true that the vast majority of artists signed to major labels never “recouped,”—meaning, they didn’t sell enough records to pay off their debt to the label for recording, manufacturing, distribution and promotion of a record, past the point at which they’d start earning royalties on sales, that isn’t true for every artist and every label. Independent labels, for example, were known for controlling costs and more equitable artist contracts under a 50-50 split after they met their investment in getting the record out there. Then there’s the fact that the labels—even the majors—acted as a kind of bank for an artist. There was tour support, there were advances that could help the artist focus on what they do best, which is to write and record music. This is the system that allowed Bruce Springsteen to release three or four records before he even made a dent in the public consciousness. It’s fair to say that that kind of indulgence would not be allowed of today’s songwriters and performers.

But the idea that artists had to sign away their rights to an outside entity for 35 years under federal statute just for a shot at entering the marketplace is something that free culture advocates are right to oppose. What was so liberating about digital technology and the growth of the Internet was that creators had more choices about how they went about their business. This was—and continues to be—both empowering and a bit terrifying. But I personally wouldn’t want to go back to the old days. As someone who straddles the divide between the analog, scarcity-based era and this brave new world of connectivity and abundance, I always try to remind folks that the old system wasn’t great shakes for the vast majority of artists.

As developments in network technology and distribution continued, there were also advances in the tools with which people create and engage with media. This is sometimes called “remix culture,” where pretty much every kind of entertainment or cultural artifact is available for sampling, deconstruction an re-contextualization. We are currently swimming in a sea of hybridity, where nothing is off-limits. To a large extent, I celebrate this kind of participatory environment, because it allows those who otherwise would not have had an opportunity to engage in the cultural dialog to get their hands dirty, even if it’s just for fun.

On the other hand, it’s obvious that the laws and business practices that have governed and informed how media is created, accessed and monetized have failed to keep up with the pace of technology and the expectations of users. This is a kind of “bug” that the free culture advocates failed to fully anticipate, but one that will require more forethought and presence to truly solve. Because if we don’t get it right, the danger is that the commercial industries will peel off from the rest of us, and only the superstars and the concentrated media outfits will benefit from the digital economy.

Let’s talk about how a better balance might be drawn that allows for participatory culture and innovation to thrive, but also enables upcoming generations of creators to pursue sustained careers in their chosen vocations. I’d also like to get some feedback on the solutions put forward in the conclusion of The People’s Platform.

By now, it is becoming clear that cultural production faces real challenges in the digital age, especially for individual content creators. While there are new efficiencies in production and distribution, a great idea still takes the time it takes to bring to fruition, and there are some activities, like reporting, that require considerable investment to ensure quality.

If we’re talking about journalism or other forms of what used to be called “mass media,” like broadcast television and commercial radio, the Internet has certainly had an effect, but many of the problems with these business models can be traced back before broadband. We will discuss consolidation in broadcasting in more detail further into the course, but for now, it’s important to understand that the response of the media industries to the Internet were exacerbated by previous decisions enabled by poorly thought out policy choices.

In the US, there is a government agency called the Federal Communications Commission (FCC) that is responsible for overseeing the broadcast and media space and deciding every four years whether the rules around ownership of our nation’s communications and media infrastructure is consistent in the FCC’s mandate to promote “localism, competition and diversity” on the public airwaves. And they are indeed the public airwaves—the whole reason that the FCC came into existence was to ensure that the emerging communications apparatus of the 1930s was protected from the forces that made technologies like radio such a powerful propaganda tool in fascist Europe. The radio spectrum was determined to belong to the American people, with this resource held in a kind of trust by the FCC, who issued licenses for commercial use, provided the licensees uphold basic obligations to serve their local communities. Over the years, these obligations have eroded.

The FCC’s job is made more complicated by legislation passed almost 15 years ago: the Telecommunications Act of 1996. That bill did a lot of things, some good, lots not so good. One of the not good things was the lifting the caps on the number of radio stations a single broadcast company could own, and relaxing rules on cross-ownership. The former cleared the way for corporate radio giants like Clear Channel to gobble up all the smaller commercial broadcasting stations, which turned what was formerly a very diverse array of stations that competed with each other on quality of programming into a kind of national jukebox with homogenized and restrictive playlists. The second thing, the relaxing of cross-ownership rules, meant that a TV station could own a newspaper and a radio station. This means less locally originated content and more syndicated programming. This is why you hear more about the Kardashians than you do Syria or climate change.

There’s no doubt that the arrival of the Internet had a massive impact on the newspaper industry, as those companies lost their lock on the advertising market. But as The People’s Platform points out, the response of the owners of these news companies was to slash editorial staff, eliminate most foreign bureaus and pursue more aggressive consolidation and cross-ownership. If you own a television station, the thinking goes, you can make money to subsidize your editorial war room. But if you get rid of those reporters and editors, you can wow the shareholders with higher profit margins. As it turns out, this didn’t work very well for companies like the Tribune, and it certainly hasn’t helped in terms of quality reporting. Astra uses the term “churnalism,” which is a fun buzzword to describe the search-engine optimization and ad click-through driven world of online publishing. Those Buzzfeed quizzes are hard to resist, but what are they doing to the business model for content that takes greater sweat equity to produce? According to the figures, some 7,000 page views are necessary to break even on an article that paid the writer $25. Is that sustainable?

All of this was neatly summed up by Gawker Media founder Nick Denton, who said, “quality is not a growth strategy.”

We’re touching on this today because there have been attempts—some described by Astra in the book—to find a new funding model for quality journalism. The book describes the experiences of Stephan Janis, the former Baltimore Examiner reporter who founded his own online outlet in order to continue to cover the important civic issues in his city. Here’s a reporter with a lot of experience and connections who knows how to do his job. But paying a living wage for these skills through a new model proved insurmountable, and there were other barriers as well, including some reluctance among his sources old and new to open up to “just a blogger.”

A.C. Thompson from ProPublica talked about nonprofit journalism funded by charitable foundations: “There’s not enough philanthropic money in US foundations to cover the shortfall in journalism and reporting resources.” So that’s not a long-term solution. Some forms of public media, like NPR and PBS under the Corporation for Public Broadcasting, have gotten good at pledge drives and encouraging viewers and listeners to directly support their enterprise. But there’s also a lot of corporate underwriting. I’m not saying that this affects content, but you could see how even what is supposed to be an alternative to purely for-profit newsgathering could be impacted by the same forces that limit perspectives in the commercial information space.

The idea of the Internet was that it would unleash the possibility of countless “citizen journalists,” who would happily take up the mantle of reporting on what’s going on in their communities. These folks do exist, but unless you’ve got other sources of money, it’s difficult to sustain.

Last week we talked a little bit about increased government investment in media production. On the newsgathering side, this in some ways runs counter to the American tradition of a press that is independent of state influence, the so called “fourth estate.” There are also other examples globally of government investment not only in newsgathering and reporting, but also culture and entertainment. I want today’s discussion to center on what kinds of models should we be considering with regard to investment in media and the arts?

What would our choices mean in a global context? Where are the points of resistance? Is there a tipping point at which a new model becomes inevitable or impossible? What kind of information and cultural landscape would you want your children or grandchildren to experience?

Our general topic today is the music industry.

The music industry took the hit first and is in the throes of a decade-plus remaking; disintermediation has also reshaped other creative industries as traditional business are models upended and a host of technologies—established and emerging—vie for primacy in the new paradigm. Film, television, and even gaming are posed for further disruption. This section will explore how the creative industries have responded to the digital shift and what this adaptation—if any—has means for today and tomorrow’s practitioners.

Here’s a simple way of looking at things when we’re talking about the intersection of intellectual property and technology. There have two basic choices with any given use of intellectual property: block/deny or license. Each choice comes with a submenu of options, and that’s where things can get sticky. With “block/deny,” it’s a question of which regulations and technologies can be applied to allow owners/creators to exercise their rights, along with which exceptions/limitations to those rights best serve the public interest (and let’s not forget the fact that authors and the public are the express beneficiaries of this constitutionally established system).

Option II, “license,” is what establishes the marketplace for content and innovation. The questions here are about efficiency, investment and equity. My day job is making sure that the needs of creators are considered within these structures. Let me be perfectly clear: it’s rarely black and white. There are compromises and tradeoffs within both buckets. It should be the goal of advocates and policymakers alike to ensure that any systems—regulatory or marketplace—serve the fundamental interests laid out in Article I, Section 8, Clause 8 of the United States Constitution, aka the “progress clause,” which is:

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.

I don’t see anything in there about the rights of big media or technology companies, although these entities certainly can both play a useful role in terms of up-front investment of creativity, distribution, marketing and infrastructure. Unfortunately, some of the bigger players want artists to think that as long as you have benevolent media companies that pay royalties or if you’ve got basic access to audiences on a platform, then all the problems are solved. This leaves an awful lot out.

When we look at the response to the advent of file-sharing and Internet technology in general, we see that by and large, the music industry was unable to anticipate or take advantage of the disruption. Had they been able to respond in a more flexible way with regard to licensing their content, we might be living in a different world today (although it’s hard to say for certain, given pre-internet trends towards corporate consolidation). Ultimately, the fight about copyright enforcement that started with Napster took up so much time that it forestalled progress around new ways to license music and other media.

To me, licensing and enforcement should go together like hand in glove. But it’s hard to put on a glove if you’re making a fist.

Today there is tremendous consolidation among major music labels and other content owners, which ties into another another looming issue: the paid prioritization of content delivered over the Internet. This is at the heart of what’s known as the “net neutrality” debate. We talked about that last week, and we’ll be taking a closer look later in the semester. But right now the important thing to remember is that many of the same players that sought aggressive copyright enforcement through litigation and legislation are now hoping to maintain their dominance through leverage of existing laws along with faster online delivery of their content over the competition. And that competition can be an independent content company, a new digital service, a political website or an individual creator trying to reach audiences on the Internet.

This is not meant as an indictment of corporations. There are instances where the pre-Internet system worked for creators, particularly in terms of the kind of up-front investment that allowed an artist to focus on their work, as opposed to being the biggest Twitter personality. Likewise, I don’t totally fault the technology sector for where we ended up. There may very well be a “cult of disruption” and deregulatory emphasis within Silicon Valley and venture capital culture, but there are also a lot of people who simply want to build exciting and useful stuff. It may be that some of the biggest companies in tech haven’t contributed directly to the creation of content, but that may be changing. YouTube is trying to compete against television, so they’re investing more heavily in channels and creators. Amazon and Netflix are developing original series. Music is an essential layer of pretty much all of this. So I think it’s likely that we’ll see more direct investment from the tech sector in creative content. The question is under what conditions.

All of this is increasingly connected, whether its intellectual property law or marketplace trends or Internet policy. Right now, there’s an examination of copyright laws happening in Congress and the federal agencies. There’s also ongoing regulatory developments in telecommunications that will affect who gets to access audiences and at what cost. Then there are the larger issues of competition policy and whether the spate of mega-mergers we’ve seen in the past decade-plus will continue. All of this affects the creative industries, and all of it impacts how creators will make a living in years to come.

When we read Astra Taylor’s book, which is ultimately a structural critique through a labor lens, we see that the story is more complicated than some might have you believe. You might ask, “well, how come there’s nobody lobbying for the artists?” I would answer, “there’s no money in it.” You do have unions doing some good work for creators, but a lot of their focus is contract negotiations with media companies as representatives of a labor class. There is some federal policy focus, but that’s not a main emphasis. In the music industry, you’ve got a mix of trade associations that represent traditional industry players, like record labels and music publishers, along with groups like the Recording Academy (aka the folks who put on the Grammy Awards). The Recording Academy does a lot of great work at the member level, particularly in education, and they also operate a health care program for musicians called MusicCares. However, their governance also includes some of the big music companies that have historically not always treated the artists fairly. So when it comes to legislation or federal policy, you end up with the same kind of content vs. technology dichotomy that has frustrated the creative industries for more than a decade.

I find Astra’s book significant in its attempt to reframe the debate. As I mentioned last week, there’s an emerging market for scoldy books about the Internet, just like there was previously a market—probably mostly tapped out at this point—for digital utopianism. What Astra’s is pointing out is that we do a disservice to both the promise of networked technology and those who innovate and create if the discussion remains bipolar.

I want to open things up for discussion about what we’re encountering thus far in her critique. Here are a few points to consider.

On tech platforms and Internet economy, generally: “These platforms succeed because of an almost unfathomable economy of scale; each brings revenue from targeted advertising and fodder for data miners.”

-Will advertising become the dominant economic incentive on the Internet, and what does that mean for investment in creative content? Privacy? Revenue distribution?

On “free” content generation: “The connections between people are not uniformly reciprocal… Networks allow for co-optation as much as cooperation.”

-What does “playbor” mean for competition and the valuation of creative content?

On efficiency and value of creative production: “…the arts suffer from a ‘productivity lag,’ where productivity is defined as physical output per work hour.”

On corporate expectations re: growth: “…the increase of shareholder influence in the corporate sector accelerated the demand for higher returns on investment and shorter turnaround.”

-Is it possible to balance the interests of growing the economy with the virtuous inefficiencies common to intellectual and creative labor? If so, how?

On cost-cutting at the expense of quality (journalism): “So far, media owners have shown every sign of grasping electronic delivery as yet another chance to cut costs and increase revenue without putting anything back into journalism.”

-Where else is this dynamic observable? What are some alternatives to cultural production and investment?

 

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