Someone in Microsoft's marketing department must have a dark sense of humor, because just four years ago the company started calling its digital music format, its proprietary method for downloading, storing, and playing digital music, "PlaysForSure." The name was intended to highlight the fact that, in contrast to the iTunes-iPod combo, PlaysForSure was supported by dozens of music stores and device manufacturers. Songs purchased from Rhapsody, Yahoo! Music, or the MSN Music Store could be enjoyed on players manufactured by Samsung, Dell, Sony, or Creative.

In spite of this, Apple's iPod continued to outsell all the PlaysForSure players put together. So Microsoft reshuffled its strategy in 2006, releasing a new music player called the Zune. Convinced that the tight integration between iTunes and the iPod was the secret to Apple's success, Microsoft abandoned the PlaysForSure approach, shuttered the MSN Music Store, and built the Zune around yet another proprietary format.

As a result, music in the PlaysForSure format will not play — for sure or otherwise — on a Zune music player. Up to here this is just an ordinary business story of technological obsolescence, certainly nothing to be outraged about. Companies drop old product lines all the time, and sometimes that means customers are stuck with compatibility headaches. In ordinary circumstances, you would expect entrepreneurs or volunteers to pick up Microsoft's slack and offer software to convert those old recordings to another format.

But the Digital Millennium Copyright Act transforms what would normally be a promising business opportunity into a federal felony. Not only will PlaysForSure music not play on a Zune, but the DMCA makes it illegal, punishable by up to five years in jail on the first offence, for third parties to offer utilities to bridge that gap. The PlaysForSure format includes copy protection technology that was supposed to deter piracy. Under the DMCA, no one may "circumvent" a copy protection scheme without the permission of the platform's owner. Moreover, it is illegal to "traffic" in software that performs this function.

That means that customers with PlaysForSure-formatted music have only three options. They can content themselves with the dwindling number of PlaysForSure-compatible music players still left on the market, such as the Sony Walkman or Creative Zen. They can burn all their music to CDs, then re-rip them to an open format — not just a time-consuming process but one that will reduce the quality of the recordings. Or they can break the law and download illegal software to convert their music to an open, widely supported format such as MP3, allowing their music to be played on any music player, including iPods and Zunes.

As if all that weren't enough, this fall Microsoft will switch off the license servers that allow customers to "authorize" new computers and operating systems to play music bought from the MSN Store. Customers who replace their computers will find themselves with no legal way to play their music.

It's a rich irony that users who choose to break the law and download music from peer-to-peer file sharing sites don't face these inconveniences. The DMCA ostensibly was aimed at stopping illicit file sharing, which continues unabated. There is no evidence that the law has kept music off peer-to-peer networks. There is no evidence that PlaysForSure has kept music off peer-to-peer networks either. And music on peer-to-peer sites is typically available in an open format such as MP3, which can be played on almost any device. Thus the DMCA's only substantial impact on the music marketplace has been to inconvenience those who made the mistake of purchasing music from a legal online service.

There is growing recognition of the absurdity of this state of affairs. Copy protection has become so unpopular that after years of insisting that all music downloads come in copy-protected formats, last year the major labels began allowing some online retailers, including Apple, Amazon, and Wal-Mart, to sell music downloads in the open MP3 format. But as the PlaysForSure debacle demonstrates, there is still a great need to reform copyright law. The DMCA needlessly restricts consumers' freedom to listen to their legally purchased music on the devices of their choice. In the name of fighting illegal downloads, it has created a big incentive to download music illegally.

Update: Between the time this story went to press and this posting, Microsoft has announced plans to support PlaysForSure customers through 2011. For more information, go here.

The vision laid out by economist Ronald Coase in his 1959 paper on spectrum remains the guiding light for spectrum policy reform. Property-like rights in electromagnetic spectrum and a secondary market for spectrum licenses are well recognized as the best ways to allocate spectrum to its highest and best uses. When spectrum is better allocated, both telecommunications consumers and providers will be far better off.

Numerous commentators have built on Coase's wisdom and charted paths to facilitate markets in spectrum. However, defining rights to use spectrum is far more difficult than ordinarily suggested. Problems such as geographic spillover and adjacent channel spillover make it much more difficult to define rights to spectrum and to determine how to measure when those rights have been transgressed. Unlike the case of real property, which is measured in two or three dimensions, there are as many as seven dimensions by which electromagnetic frequency can be measured, and the best way to measure these dimensions remains unsettled. Many decisions remain, such as whether to use statistical models of radio wave propagation, actual measurement of interference, or some combination of the two to determine the scope of rights in spectrum.

More careful analysis is needed to determine what type of property regime will operate effectively to govern rights in spectrum. A number of questions must be answered for a transition to a property rights regime to be successful.

The courts have a proven track record of fashioning balanced remedies for the copyright challenges created by new technologies. But when Congress passed the Digital Millennium Copyright Act in 1998, it cut the courts out of this role and instead banned any devices that "circumvent" digital rights management (DRM) technologies, which control access to copyrighted content.

The result has been a legal regime that reduces options and competition in how consumers enjoy media and entertainment. Today, the copyright industry is exerting increasing control over playback devices, cable media offerings, and even Internet streaming. Some firms have used the DMCA to thwart competition by preventing research and reverse engineering. Others have brought the weight of criminal sanctions to bear against critics, competitors, and researchers.

The DMCA is anti-competitive. It gives copyright holders—and the technology companies that distribute their content—the legal power to create closed technology platforms and exclude competitors from interoperating with them. Worst of all, DRM technologies are clumsy and ineffective; they inconvenience legitimate users but do little to stop pirates.

Fortunately, repeal of the DMCA would not lead to intellectual property anarchy. Prior to the DMCA's enactment, the courts had already been developing a body of law that strikes a sensible balance between innovation and the protection of intellectual property. That body of law protected competition, consumer choice, and the important principle of fair use without sacrificing the rights of copyright holders. And because it focused on the actions of people rather than on the design of technologies, it gave the courts the flexibility they needed to adapt to rapid technological change.

It sounds like science fiction, but Google is now working to make it a reality. The Google Print project aims to scan digitally and index every book ever written, creating a search engine for books just as powerful as its industry-leading search engine for the web.

Unfortunately, the biggest obstacle Google faces isn't technological, but legal. Publishers are accusing Google of copyright infringement, and they're demanding that the company get individual permission from each publisher before it scans their books. So far, Google has resisted the demands, insisting that building such a search engine is a legal fair use under copyright law.

There's a strong case for that position, and given the tremendous benefit Google Print would bring to library users everywhere, Google should stick to its guns. The rest of us should demand that publishers not stand in the way.

People often assume that the law gives copyright holders unlimited control over their creative works. But a minute's reflection shows that that's not the case. Book reviews routinely include excerpts, computer users make backup copies of legally purchased software, and people record television shows for later viewing. The courts have upheld the right to make such copies without the permission of the copyright holder under the doctrine of fair use.

Courts have recognized the fair use doctrine for centuries, but Congress formally codified the principle in the 1976 Copyright Act. It spells out the factors that determine when an unauthorized copy is a fair use. According to the Supreme Court, the most important factor is "the purpose and character of the use." It asks (as the court wrote in 1994) whether a new work "merely supersedes the objects of the original creation, or instead adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message; it asks, in other words, whether and to what extent the new work is transformative."

In 2003, for example, the courts allowed an Internet search engine to display thumbnails of copyrighted images because the purpose of the thumbnails -- allowing users to quickly find the images they were searching for -- was very different from the purpose of the original images.

Viewed in that light, Google Print is clearly a transformative use. It has a "further purpose" and "different character" than the books it indexes. Its value is not derived from the creativity of book authors, but from the innovation of its engineers.

Another factor the courts must consider is "the effect of the use upon the potential market for or value of the copyrighted work." It seems clear that Google Print's impact on the book market can only be positive for authors and publishers. Google Print only shows brief excerpts of books that are still under copyright. A user will have to obtain a printed copy of the book if she wishes to read more. That can only increase book sales.

The Constitution states that the purpose of copyright is to "promote the progress of science and the useful arts." In other words, intellectual property increases public access to creative works by giving authors the incentive to produce them. Given Google Print's tremendous potential to help readers find the books they want to read, it would be perverse to invoke copyright law to strangle the service in its cradle.]]> Sat, 23 Jul 2005 00:00:00 EDT http://www.cato.org/pub_display.php?pub_id=4000 http://www.cato.org/pub_display.php?pub_id=2932 Would it make sense to allow a clothing designer to patent a fashion fad, like "bell bottom" jeans or mini skirts? Likewise, should beauticians be able to patent a particular hair style, or should fragrance makers be granted intellectual property protection for the scents in their perfumes or colognes?

Granting designers patents in these fashions or fads would seem fairly absurd since most countries typically do not allow aesthetics -- or matters of fashion and beauty -- to be the subject of intellectual property law. But that doesn't stop some companies from attempting to do so. For example, General Motors recently announced it is suing a Chinese carmaker for allegedly copying an automotive body design similar to one produced by Daewoo, a South Korean unit of GM. GM has been considering a case against a state-owned carmaker Chery for some time, suspecting the Chinese company of borrowing many design elements or even components from the Daewoo "Matiz" model.

While there may be some merit to some of the claims made by GM, efforts to secure intellectual property in aesthetics need to be carefully scrutinized. In the United States, the debate over protecting aesthetics has recently heated up after measures passed into law granting some protection to architectural designs and boat hull designs. Other countries have considered similar laws or already have similar legal protections in place.

There are two good reasons why governments typically do not grant patents or copyrights for fashions or designs. First, it is extraordinarily difficult to separate one claim from another. Car, boat or building designs are, at root, highly subjective forms of art. There is a great deal of ambiguity tied up in the question of what separates one design from another. You can find more than a few skyscrapers in one city that will resemble those found in another. And many of the cars on the road today look a lot alike. These practical considerations weigh against the award of a patent to one designer since many others can independently arrive at a very similar conception of a building, boat, or car.

Second, as a matter principle, copyright and patent law should be primarily concerned with creating incentives to innovate. We want artists and scientists to be more creative and produce more works for society and, therefore, we grant them certain limited terms of protection to incentivize such activity.

But it has always been acknowledged that there must be some rational limits on the scope of IP protection granted by law, and that includes the question of whether it makes sense, in some cases, to grant any protection at all. Fashions, fads, and aesthetic designs have traditionally fallen into this camp. There is little reason to try to incentivize such activities or forms of creation since they happen quite naturally on their own. After all, has there really ever been any shortage of good clothing lines, hair styles, building and boat designs, or automotive body designs?

But how we call in the cops and who the IP cops are makes a big difference. In particular, we shouldn't expect Congress or regulatory agencies to legislate on every problem that creeps up or ban or mandate specific technological solutions in an attempt to solve IP debates. But when certain parties are egregiously violating the rights of copyright holders, they are certainly justified in seeking redress in the courts. Common law resolution to copyright disputes has the advantage of avoiding a hasty, ham-handed legislative quick fix. As has been the case throughout most of copyright's history, courts can sort through rival claims to determine where the creators' concerns have merit and where the rights of consumers should instead carry the day. Two recent IP disputes illustrate how this sensible framework can still work today.

The "Broadcast Flag" Decision.
Last November, at the request of several content companies and broadcasters, the Federal Communications Commission mandated that by July 1, 2005, every consumer electronic device in America capable of receiving digital TV signals must be able to recognize a "broadcast flag" -- or string of digital code -- that will be embedded in future digital broadcast programming. In theory, the presence of this embedded code will encourage content creators and broadcasters to air more digital programming "in the clear" (i.e., over the air), on the assumption that the broadcast flag will allow them to prohibit mass redistribution through peer-to-peer (P2P) networks. In other words, the broadcast flag mandate is supposed to prevent the "Napsterization" of video programming.

But in their rush to preempt this supposed problem, a completely sensible alternative was ignored. Namely, if you're a broadcaster or a movie studio and discover that a handful of individuals are redistributing your products without permission or compensation, why not just sue them directly and avoid all this regulatory nonsense? No good answer was provided. What makes this all the more surprising is that such a model already existed in the lawsuits that the Recording Industry Association of America (RIAA) was filing against individuals accused of widespread copyright infringement. As distasteful as some find the RIAA lawsuits, they are certainly superior to the strategy the music industry was pursuing previously: trying to shut down all (P2P) file sharing networks. At least a lawsuit strategy would be capable of targeting the handful of individuals causing the most serious problems, without seeking to ban technologies or concocting grand industrial policy solutions to the problem. But instead of taking this more targeted approach and using the courts to go after the handful who might illegally distribute digital TV programming, the broadcast flag proposal opens the door to an intrusive FCC regulatory regime for the Internet and computing in the future.

The 321 Studios Case.
Another instance where this model could have been tapped is the fight over the "DVD X Copy" and "DVD Copy Plus" software products sold by 321 Studios, which allow consumers to make backup copies of DVDs. In fact, 321 Studios is currently involved in a heated lawsuit with the members of the Motion Picture Association of America (MPAA) over the legality of 321's software, which MPAA believes violates Section 1201 of the Digital Millennium Copyright Act of 1998. Section 1201 bans technologies that would circumvent or defeat the technological measures used by copyright owners to protect access to their works. This anti-circumvention mandate is quickly proving to be one of the most controversial copyright reforms passed by Congress in years and now threatens to remove software from the market that is being used for entirely legitimate and lawful purposes.

MPAA president Jack Valenti -- the same man who once said, "the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone" -- has argued that consumers have no legitimate need for software products like those sold by 321. Last November he said, "If you buy a DVD you have a copy. If you want a backup copy you buy another one." But this worldview is not consistent with the rights consumers already enjoy with regard to time-shifting or saving content on audio cassettes or VHS video tapes. Consumers should have the reasonable expectation that they will be able to make at least some copies of the content they purchase, whether that content appears in books, music, or movies. For example, I have personally used similar DVD backup software called "DVD Shrink" that I freely downloaded from an overseas website to copy and burn my favorite individual movie scenes onto a single DVD. I use this single DVD to show friends and family all my favorite DVD scenes in rapid succession without having to put the original movie in the player each time. (This is similar to what millions of American already do with music when they burn their favorite songs onto one tape or CD.)

But, following the logic of the case against 321, presumably the MPAA would like to see the "freeware" I downloaded outlawed and then throw me in jail to boot. But why? It's hard to see how I've broken the copyright bargain in this case since I went out and purchased dozens of new movies to make this compilation of my favorite movie scenes. If, however, I had made additional copies of this compilation DVD and sold them on e-Bay, or even shared the disc with the entire world via a P2P network, I would agree that I had crossed a line and broken the copyright bargain and should be held liable for my actions. And 321 Studios acknowledges this, too. On their "Protect Fair Use" website, the company states, "Fair use isn't the same as free use. Consumers shouldn't have the right to make copies for commercial use without the permission of copyright holders. They should not be able to sell illegally acquired copies of digital works, either on disk or over the Internet." That's exactly right, and the proper course of action in cases where consumers betray this trust would be for the movie studios to file suit against them for undercutting the commercial viability of their products. But if millions of average movie lovers like me are considered criminals for merely copying a few of their favorite movies or individual scenes onto a different disc, then something has gone horribly wrong with copyright law in America.

Intellectual property plays a vital role in our modern Information Age economy, but we should not adopt a "by-any-means-necessary" approach to copyright enforcement. Targeted, court-based adjudication of clear-cut copyright infringement is the better way to balance the interests of consumers and creators.

From its inception in the U.S. in the early 20th century, compulsory licensing has been seen as a means of making intellectual works available by reducing some of the transaction costs associated with obtaining permission to use copyrighted material. There are now increasing calls for compulsory licensing for digitized works on the Internet, particularly music.

Conceptually, a compulsory license falls midway between granting full copyright, which gives owners broad control, and denying copyright protection altogether.

Rather than allowing musicians, artists, and other copyright owners to negotiate licensing terms for use of their works, a compulsory license forces copyright owners to allow use of their works under legislatively set prices and restrictions on use.

When warring groups sound the alarm over excessive control via copyright on the one hand and insufficient incentives to create on the other, compulsory licensing seems a reasonable compromise. Compulsory licensing seems to pay off big in the short term by reducing the need for individual buyers to locate, negotiate with, and pay individual sellers. Compulsory licensing supposedly addresses the "market failure" of high transaction costs.

But markets for digitized works do not suffer from market failures. Furthermore, the Internet has reduced the transaction costs that once served as a key rationale for compulsory licensing. Recent developments suggest that fears of excessive control of digital content are overblown. Without enhancing compulsory licensing, the digital landscape is diverse, as the case of music demonstrates. There is free music, temporarily free music, and low-cost music online. Offline, music companies are lowering the prices of CDs.

The influence costs associated with compulsory licensing schemes make them a more expensive mechanism for setting prices. Private negotiations are much cheaper and more flexible over the long term.

In the digital realm, we have not yet abandoned the basic building blocks of all creative endeavors--property rights, contracts, and voluntary markets--and we therefore retain the preconditions for future growth and diversification.

The real issue, however, is whether a "U.N. for the Internet" is on the way. Last week's summit and another in 2005 will discuss whether Internet decisionmaking should be shifted from largely private management to the United Nations.

In one sense, none of this is surprising. Regulators across the globe have long been clamoring for greater control over content and commerce on the Internet. Ironically, in the guise of protecting the world's citizens, Statists around the world want to get their hands on one of the world's most liberating communications technologies.

While the U.N. conferees have "generously" agreed to retain language that enshrines free speech, despite the disapproval of countries such as China and Iran, these matters are far from settled. There've been a few notable international cyber-spats already, such as a French court's attempt to force Yahoo! to block the sale of offensive Nazi materials to French citizens, and an Australian court's ruling that the online version of Dow Jones publication Barron's could be subjected to that country's libel laws. And Chinese officials have attempted to censor the search engines Google, AltaVista and Yahoo!

Apart from speech and libel laws, sales taxes, privacy policies, antitrust statutes, intellectual property laws, and that fearsome "digital divide" are other hot button issues that will undoubtedly find their way onto the U.N. agenda. What gives foreign bureaucrats the right to wrap their tentacles around the World Wide Web? How can a Web site operator know how to act or do business in this confusing legal environment? And who really should have jurisdiction over Internet activities anyway?

We examine these complicated questions in a new Cato Institute book, Who Rules the Net? The threat a patchwork of international laws poses for online vendors and the growth of e-commerce arises from the fact that compliance with 190 different legal codes would be confusing, costly, and technically impossible for all but the most well-heeled firms. A Web site operator's only option would be to conform its online speech or commercial activities to the most restrictive laws on the planet to ensure global compliance. If you like the idea of Zimbabwe's dictator du jour setting libel standards for everyone on Earth, this sort of lowest common denominator regulation is the legal regime for you.

If enough countries start playing these games, the threat of retaliation and potential trade wars increases as cross-border legal spats intensify over privacy, gambling, pornography, intellectual property, and tax policy. All these interventions provide footholds for poorer nations to effect wealth transfers from wealthier nations to address digital divides and poverty largely of their own making -- problems rooted in fundamentally inept or despotic governance rather than Internet governance.

The implications for online commerce are profound. The moment one puts a Web site online, one has "gone global." Should that mean you have automatically and willingly subjected yourself to the laws of every country on the planet? Shouldn't the origin of content matter?

This is one reason some favor the "U.N. for the Net" model. But others have suggested that international treaties or adjudication by the World Trade Organization might offer the better approach. Still others assert that the best answer is to do nothing because the current unregulated Web environment has helped expand free speech and commerce globally for companies, consumers and citizens alike.

We favor the latter. But to the extent pure laissez-faire is not an option, "country of origin" standards may provide the best default solution. That is, government should only exert authority over those actors who physically reside within the confines of their traditional geographic borders. In this sense, an origin-based jurisdictional methodology protects sovereignty while simultaneously giving meaning to the notion of "consent of the governed" in an online setting. Healthy jurisdictional regulatory and tax competition via origin-based rules would allow companies and consumers to have a "release valve" or escape mechanism to avoid oppressive jurisdictions that seek to stifle online commerce or expression.

Software-enabled geographic targeting may increasingly play a role, too. Particularly as U.N. power-grabbing grows more extensive, businesses may choose to avoid interaction by using geo-location technologies to selectively target their services instead of making materials available to the entire planet. Such targeting may be the better approach from a marketing perspective anyway. But to have it forced by U.N. shenanigans would be unfortunate.

The great advantage of the Net is precisely the ability to reach as many people as possible and overcome artificial restrictions on trade or communications at traditional geographic boundaries. The Web, whatever problems it has raised, has provided far more opportunity and freedom to mankind. The U.N. appears eager to assume greater control over the Net, not because of it's failures, but because it undermines members' authority. That sounds like the best reason ever to make sure a U.N. for the Internet never becomes a reality.

New Internet-based technologies appear to threaten the ability of copyright owners to collect revenues for their intellectual creations, as epitomized by the recent public trials and tribulations experienced by Napster. That has resulted in new legislation against pirating and has given rise to new technologies to protect intellectual products. Both the new technologies and the counter-technologies that have followed them have attracted attention and analysis, sometimes bordering on the apocalyptic, from competing camps. The basic issue, whether technologies that enhance the ability to create unauthorized copying are destructive to the principles of copyright, is not a new one, however. Technologies that make it easier to pirate copyrighted materials have undergone economic examination for over two decades. Prior analysis, and prior experience, has indicated that the previous generations of copying technologies have not had dire consequences for copyright owners.

This paper examines whether new Internet copying technologies are likely to be different from prior technologies in their ability to destroy the value of intellectual property rights and concludes that they are. It then examines the evidence that has been put forward to support a claim that Napster had a negative impact on the compact disk industry and concludes that the evidence does not support such a finding. I then explain why it is that the negative impacts of Napster were unlikely to have been felt at the time these examinations were undertaken.

Finally, the analysis examines the impact of a possible market-based solution to this potential problem, based on new anti-piracy technologies known as digital rights management. This technology not only promises to make copying harder, but also allows the copyright owner to charge tiny micropayments for various degrees of use of the product. This extra control by copyright owners over the use of the copyrighted material has set off a firestorm of controversy by individuals concerned that traditional "fair use" of a product will disappear and further claiming that digital rights management will lead to economic inefficiency. Fair use has historically allowed scholars and others to use small amounts of copyrighted materials for research or study without being obligated to make copyright payments. I show that digital rights management, contrary to these claims, does not eliminate fair use and is likely to enhance economic efficiency. Nevertheless, attempts by government to force the adoption of anti-copying technology appear misguided.

On the eve of the national holiday celebrating King's birthday, his legacy is under attack, not by racists, Ku Klux Klansmen and segregationists, but by scholars, civil rights leaders and the media. The target of their attack is not King's message but his family--his widow, Coretta Scott King, and their children.

Late last year, the New York Post indicted the family as King's "ignoble heirs;" the New York Times accused them of "misplaced values," calling their behavior "distressing" and "heartbreaking;" the Houston Chronicle smeared them as "grasping, greedy, tacky ... and, worst of all, unworthy" of their slain patriarch. The attacks climaxed with a CBS "60 Minutes" broadcast in which William Rutherford, a former executive director of the Southern Christian Leadership Conference, feared that King "must be spinning in his grave." Reporter Lesley Stahl joined the chorus, mourning that "the family has even been accused of killing the dream." Killing the dream? What monstrous thing has the King family done to provoke such vicious criticism? It turns out that they're under siege because they've chosen to protect what is rightly theirs--the property they inherited from King after he was assassinated in 1968. Under the Copyright Act of 1976, a federal law authorized by Article I, Section 8, of the U.S. Constitution, the rights to King's writings belong to his heirs.

Like most intellectual property owners, the Kings protect and license their rights. In 1997, they licensed Time Warner Inc. to release a large quantity of King's writings--many hitherto unpublished--in books and electronic media. The Kings also allow nonprofit and educational institutions to enjoy certain noncommercial uses royalty-free, and they make King's works available for a fee to the media and other for-profit entities. They've licensed his voice and image for at least two television commercials.

But in 1993, the King family sued USA Today for publishing, without permission, the entire text of King's most famous work--the "I Have a Dream" speech he delivered Aug. 28, 1963, at the Lincoln Memorial. They sued CBS in 1996 when the network sold videotapes containing nine minutes of that speech. And they raised questions when a group with no connection to the family proposed using King's name to raise tens of millions of dollars to erect a huge monument on the Mall in Washington.

These actions have provoked outrage. Brent Staples wrote in the New York Times that the family is trying to "corner the market" on King's words, placing "profits above the national good." The Houston Chronicle insisted that King's life (and presumably his copyrights) "belongs to all of us." Sweeping aside more than two centuries of property law, the Chronicle argued that "the standard that ought to apply here has little to do with what is legally permissible ... it has to do with what is right."

The Kings are guilty, say the critics, of three things: by enforcing their property rights, they limit the dissemination of King's writings and thereby censor history; by earning profits, they dishonor their patriarch, who never cared about intellectual-property rights; and by licensing television commercials, they display poor taste. Those charges, in order, are illogical, false and irrelevant.

First, the family has no interest in suppressing King's works, much less in censoring history. On the contrary, as their multimedia deals with Time Warner and others demonstrate, they want his works to reach the widest possible market. Ideas, facts and information about King are not the subject of the copyrights; they're available to all. Thus, the Kings can't prohibit authors from writing books and articles about him; professors from teaching courses about him; editors from publishing photographs of him; or producers from making films about him. What they can control are his actual words, which they are doing, but not in any way that suggests they're censoring history.

Second, it is false to claim that King did not care about copyright. Unlike Leo Tolstoy, whose scruples against private property led him to throw his works into the public domain, King copyrighted his books. When he was alive, he sued a record company for releasing unauthorized recordings of the "I Have a Dream" speech. That hardly suggests that he meant his family to be bereft of the financial benefits that his works might afford them after his death.

Finally, the question of whether licensing television commercials is tasteful is subjective and irrelevant. Even if it did evidence poor taste, the property still belongs to the family.

This dispute over King's works is not without its larger implications. Were they to carry the day, the critics would threaten the very foundation on which the law of intellectual property--indeed all property--rests. They advocate a de facto appropriation of King's writings in the name of the "public interest." That logic leads inevitably to the socialization of copyright, with authors subject to the tyranny of the majority. Such a regime would effectively destroy any expectation of copyright protection in the work of a public figure. Perversely, the more important a work, the less copyright protection it would deserve.

That the critics are waging their campaign in the name of the First Amendment only compounds their error. In so doing, they trivialize the amendment, transforming it into a burglar's tool wielded by the media. Their theory amounts to opportunism in the name of the "public interest," "newsworthiness" or the "right to know." All property derives its value from the power to exclude others. The right to free speech does not include the right to take the speech of others for free. Reasonable people may disagree about the scope of copyright protection. But no one can deny that, under current law, King's property is protected.

Ignoring property rights, a cornerstone of the liberty King fought to secure, is an inauspicious way to celebrate his birthday. His dreams may belong to the world, but his intellectual property belongs to his family.

The most radical voices have suggested that there is no such thing as a right to own intangible ideas and, therefore, the whole regime of limited grants of monopoly is an unjust and outdated political construct that should be tossed aside. To this line of thinking, the cost of protecting IP is just another cost of doing business, so why attempt to socialize it?

Of course, the folks in this crowd acknowledge that there is value to ensuring that innovators are rewarded for their intellectual creations. After all, there is merit to the theory that limited terms of protection provide entrepreneurs with an incentive to generate important life-enriching products and ideas. A good argument can be made that in a world without IP protection, some individuals would be discouraged from producing important goods or ideas (consider pharmaceuticals or genetically altered foods to feed hungry populations).

On the other hand, the "protect- everything-under-the-sun" folks go too far when they lobby for excessive terms of protection—which go beyond any possibility of motivating creators, who often are deceased (think Mickey Mouse and The Wind Done Gone)—and seek to expand what is covered by copyright and patent law in the first place. One begins to believe record companies would assert the right to copyright the 12-bar blues chord progression if they could get away with it. Aggressive protection schemes would require nothing short of an IP police state and would greatly discourage entrepreneurialism by others.

So, succinctly stated, the problem we face when it comes to issues of IP and the Internet is how to balance artistic and entrepreneurial incentives with the interests of the larger community of users in a free, unhindered exchange of ideas and products. Again, there are no easy answers, but the following principles can help guide the debate and perhaps create some common ground:

(1) Take the principle "To Promote the Progress of Science and Useful Arts" seriously: Reasonable people can legitimately debate the appropriate time periods over which works should be protected. Any term set in law will be arbitrary. But copyright protection that extends far beyond the life of the originator provides diminishing incentives for that person to innovate. Terms of protection may need to be rethought. We should adhere to the Constitution's goal of promoting the progress of science and useful arts, not unnecessary government monopoly.

(2) Don't ban new technologies or business models to solve patent or copyright problems: In the raging file- sharing dispute, one side wants to ban or restrict file-sharing technologies that reduce copyright control. Meanwhile those who eagerly share copyrighted files often ridicule or condemn experimental technologies by which copyright holders hope to shield

works from reproduction, such as digital watermarking, enhanced encryption and attempts to incorporate digital rights management into secure hardware. Some users even regard such efforts as technical threats to free expression (even though they also claim that encryption or watermarking can always be cracked!).

Policymakers shouldn't ban any category of technology as the marketplace works through these difficult issues. Likewise, force should not be used to "aid" the sharing of IP, such as emerging calls for the imposition of compulsory licensing requirements on record companies. Such forced "contracts," with their accompanying price controls and regulatory dynamics, have no place in a nascent industry that desperately needs to embrace voluntary deals. If companies go too far in locking up information, other companies (and consumers) have the option of dealing with less-restrictive entrepreneurs. If technology is to contribute to solving the problems it has created, we must give it that chance. Digital rights management—while it will never fully prevent copying—can make it inconvenient enough so that cracking encrypted songs won't likely be worth the trouble. Perhaps a twenty-cent download that also includes liner notes, lyrics, a photo or two, and discount coupons on merchandise and concerts is a better deal than a free song. Both sides should avoid injecting government coercion into the copyright resolution process as "Napsterization" proceeds. Perhaps technology can be a better means of managing copyright, in some applications, than can law—even if law is in place as a backup.

(3) Remove government barriers to the marketplace's ability to protect intellectual property: To what extent are secrecy and privacy contracts enough? To lessen the reliance on traditional copyright protections, policymakers should ensure that government regulations don't stand in the way of private efforts to protect intellectual property. For example, overzealous antitrust enforcement might hamper collective private efforts to license songs. Restrictive contracts that antitrust law might eye suspiciously could benefit consumers by ensuring returns for producers. Some academics have suggested that regulation such as antitrust law may force the "need" for more intellectual property law and enforcement than would otherwise be warranted.

The Constitution gives Congress the power to protect intellectual property. Yet the Internet invites new perspectives on the old models of IP protection. File sharing technology clearly creates a problem, but an arguably transitory one involving the existing body of copyrighted work. In the post-Napster world, every musician and songwriter realizes there exist new methods for distributing and pricing products. Technology can increasingly serve as a partial replacement for copyright law for the artists of tomorrow—and today—if they embrace it.]]> Tue, 19 Jun 2001 00:00:00 EDT http://www.cato.org/pub_display.php?pub_id=4267 http://www.cato.org/pub_display.php?pub_id=1225 Executive Summary

Advocates of laws, regulations, and policies often use scientific data and analyses to advance their claims. In the normal course of science, controversies about data and analyses are resolved by independent researchers who attempt to replicate the data and redo the analyses. To facilitate independent review, the scientist who produces the data and analyses is generally expected to disclose his data and his methods to potential reviewers.

During the past three years, access to scientific data collected by federal grantees has become a major political issue. For instance, controversial scientific evidence was used to justify onerous regulation of particulate matter (a prominent air pollutant) and urban smog, but when Congress requested the controversial data, the grantees refused. In October 1998, Congress passed, and the president signed, Public Law 105-277, known as the Shelby Amendment. The law requires, through the provisions of the Freedom of Information Act, grantees to make data that result in a published report or that are cited in a federal rule or regulation available to members of the public on request.

Although the Shelby Amendment has drawn criticism from many policy activists and scientists, public review of data and methodology is crucial for both good science and good public policy. Scientific data collected by federal agencies have often been subjected to independent review and found to be in error. Scientific research undertaken by nongovernment scientists and financed with public money should similarly be available for review by public watchdogs to ensure that any new laws and regulations based on the research are merited. If the research is soundly grounded, then independent review will underscore the merits of those laws and regulations. If not, then independent review will help society avoid costly policy mistakes.