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Preaching to The Choir (Which Didn’t Need Copyright Protection To Assemble In The First Place, Mind You)

June 18, 2009

Could the Livingston-esque founders of Pirate Bay, or lesser mortals like Lawrence Lessig of Harvard Law School, have been right all along about the dysfunctional nature of our copyright laws?

Economists Felix Oberholzer-Gee and Koleman Strump, in an excellent working paper, point out what should be blatantly obvious: musicians and other artists don’t need ultra-restrictive ownership rights on their creations, 90 years after they are made, to encourage them to create.

Of the artists I know (I speak for myself here as well), most are not making music because they think 20 years down the road they’ll be making money off of it.  They do it for fun.  Take a look at the intense amount of work that goes into video re-mixes of songs like Nude or In The Morning, efforts that guarantee that there will be no direct financial reward.  It’s easy to see how little ‘free’ deters people from creating highly original works.

In fact, not only is payment not an issue, many artists have probably desperately considered at times paying fans just to care about what they are producing.  I generally have to beg my friends to even listen once to my songs for free (disclaimer: that likely speaks to the quality of my output, but I digress).  The idea that I could get someone to actually pay for them seems as absurd to me as it does unnecessary.  I produce music in my free time because I get a kick out of it, it sort of makes up for my beer gut when I’m trying to attract females, and if others get some satisfaction out of it, even better.

In an age where the ratio of content consumed to content produced is rapidly approaching zero, attention is the ultimate payment for recorded music/photographs/art.  Any living (if that’s the goal) one makes off these pursuits will come in the form of clever packaging, donations, licensing the work in the case of for-profit ventures, and selling merchandise supporting the brand that the artist’s body of work represents.

Obviously, the economists’ paper is not arguing for eliminating copyright altogether. Clearly, some protections are necessary to prevent artists from ripping each other off or corporate entities from appropriating images or songs in advertisements and such.

There may be a good reason to leave things alone as well.  The best argument for copyright as it currently exists is that it gives publishers incentives to invest in artists who may become popular long after (or because of) their deaths.  Without that investment, perhaps much of the great popular art we enjoy today couldn’t have been made.

This argument holds up if we are considering a time when distribution of media had a marginal cost.  But aside from the initial cost of equipment, there is no expense incurred by the artist in streaming files for free over the internet.

One might argue that major-label quality sound is necessary to start a career, but MP3 blogs typically go ga-ga over lo-fi music produced independently, as in of any label at all.  The quality of an amateur photograph or recording is reaching parity with commercial efforts.  I look at these DIY efforts as try-outs; if they gain enough attention on the internet, a better producer might offer his scarce time to improve the product and make it marketable (akin to what Brian Eno did for the Talking Heads, or Danger Mouse with The Rapture, but more organic).  This crowdsourcing is much more efficient than the archaic A&R process of tying up an artist to a multi-deal contract before they’ve even gotten into the studio.  No wonder so many major-label acts fail to turn profits.

And what of the record industry’s claims that weak copyright enforcement is putting it out of business?  Their narrow self-interest blinds them to the true purpose of copyright, which is not to maximize the profits of the companies traditionally thought of as essential to the creative industries, but simply to give incentives for people to create.  My favorite passage from the paper explains:

Unfortunately, the popular press — and a good number of policy experts — often evaluate file sharing looking at a single product market. Analyzing trends in CD sales, for example, they conclude that piracy has wrecked havoc on the music business. This view confuses value creation and value capture. Record companies may find it more difficult to profitably sell CDs, but the broader industry is in a far better position. In fact, it is easy to make an argument that the business has grown considerably. Figure 7 shows spending on CDs, concerts and iPods. The decline in music sales — they fell by 15% from 1997 to 2007 — is the focus of much discussion. However, adding in concerts alone shows the industry has grown by 5% over this period. If we also consider the sale of iPods as a revenue stream, the industry is now 66% larger than in 1997…. Technological change will often lead to changes in relative prices and shifts in business opportunities. Focusing exclusively on traditional streams of revenue to arrive at a sense of how new technology changes welfare will typically be misleading.

Despite or because of weak copyright, creative endeavors are fueling a rennaissance in the music industry, as long as we accurately measure what the music industry is.  Just like medieval self-flagellation devices had to make way for paint brushes in the 1500s, if that comes at the expense of a parastructure spending far more in marketing than it does in contributing to original production, so be it.

hat tip: Marginal Revolution, article: TechDirt

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