January 16, 2003
Disney Wins

By now anyone reading this knows the good guys lost in the Supreme Court this week. A good place to start reading about this is The Berkman Center for Internet and Society where Larry Lessig works. You can find links there to news stories and the actual opinions, including the two dissents. His blog is filled with both his own musings on losing, as well as the support and encouragement of hundreds of well wishers.
The New York Times lamented the "end of the public domain" in an editorial today.

Posted by John Battelle at January 16, 2003 09:18 AM
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Professor Lessig actually left the Berkman Center for Internet & Society in 2000 to join the Stanford Law School faculty, where he founded the Stanford Center for Internet & Society.

http://www.stanford.edu/dept/news/report/news/april19/lessig-419.html

Posted by: commenter on January 18, 2003 01:46 AM

It may prove difficult in the short term to reduce the term of
copyrights which have already been extended. Also, the forces pushing
perpetual copyright are strong. However, there is a another route, which
may be easier, employing the concepts of Aikido -- moving with the
strong force and redirecting it in a better way. Rather than fight to
reduce the maximum term of copyrights, consider that existing and future
copyrights could be taxed annually just like real estate as long as they
are kept from the public domain. This uses a market based approach to
limit the external costs of copyright monopolies.

What is the social justification for such a tax?

Real property taxes are justified by the notion that real estate imposes
a cost on society -- for fire departments, police departments, schools,
roads, sewers, water pipelines, libraries, town courts, propery record
archives, and so forth.

Copyrights were originally monopolies granted "for a limited time" with
the notion that the costs they imposed on society would be repaid by the
work moving into the public domain after that limited time. That bargain
has effectively been broken because the terms are so long (and likely
will be in perpetuity in the U.S.A. given the recent Supreme Court
decision). Yet, copyrights still pose a cost on society. There must be
courts to dispute them, police to enforce them. There must be prisons to
hold the millions of copyright offenders. Like no one in the 1960s would
imagine a million U.S. citizens behind bars for non-violent drug
offenses in the 1990s, it is possible that there may be a million U.S.
citizens behind bars in the 2010s for copyright violations as the "War
on Those Who Share" gets underway. There must be an information
superhighway to transport these works, and standards for disseminating
them. Authors of derivative works must spend time researching whether a
work is already in the public domain, or locating all the related rights
holders if it is not. Extensions of the principle of copyright to cover
the ideas in the work such as characters or plot lines or other
structures make it ever more costly to create new non-infringing works.
Many new or derived works are not created because of these chilling
effects, which is a hidden cost of copyrights. People in developing
nations or others who can not pay use fees for copyrighted works are
deprived of education or enjoyment when such a deprivation does not
directly benefit anyone. So, given all these indirect costs of granting
copyright monopolies, society is justified in imposing a financial cost
on copyright holders to rebalance the copyright bargain.

Real estate is typically taxed at a small percentage of an assessed
value. If the taxes are not paid, the real estate essentially becomes
owned by society. Note that these annual property taxes are in addition
to any fees for recording deed tranfers, liens, title searches, and such.

Since it is difficult to value a copyright, one possiblity to determine
the value of a copyright is to let copyright holders assess themselves
how much it is worth it to them to keep their work out of the public
domain. Then the rights holder would pay annually a small percentage of
this value (perhaps three to five percent). Each year, when the rights
holder sent in their tax, the rights holder could change this
self-assessed value to reflect their changing priorities and a changing
market. If the rights holder did not pay the tax, then the work would
move immediately into the public domain. If someone wanted that work in
the public domain, they could pay the copyright holder the self-assessed
amount and the work would then immediately be moved into the public
domain. This public domain buyout possibility serves to limit the
tendency of rights holders to produce low self-assessments to minimize
their annual tax payments.

This approach could include a digital archive of all copyrighted works.
Essentially, upon intial registration of a self-assessed value, a rights
holder would be required to send in a digital copy of the work. This
copy would be used to determine rights holders for works by means of a
digital search. Any work not in this database would be presumed public
domain. If the annual tax was not paid, this archive would be a place to
get a copy of the now public domain work.

This approach could also be scaled internationally where a copyright
holdler would have to determine a self-assessed amount in each country
for the priveledge of having their copyright enforcable in that country.
A benefit of this approach is that developing nations could gain a nice
income from such monopoly payments, rather than simply suffer the
knowledge of having a citizenry deprived of the fruits of human achievement.

Incidentally, this approach can
be applied to patents as well, although since patents are much more
limited in scope, the societal bargain has not been so badly broken for
their monopolies.

To argue against such taxes, rights holders like Disney need to
both argue what they have is like real property and yet somehow isn't.
This will help expose the inconsistencies and self-servingness of their
position.

Posted by: Paul Fernhout on January 21, 2003 05:13 AM
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