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redravin40 · 09-24-2003, 09:43 PM

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Art Watch
First appeared in print in The Rhinoceros Times, Greensboro, NC
--------------------------------------------------------------------------------
By Orson Scott Card September 7 2003

MP3s Are Not the Devil

Since every penny I earn depends on copyright protection, I'm all in favor of reasonable laws to do the job.

But there's something kind of sad about the recording industry's indecent passion to punish the "criminals" who are violating their rights.

Copyright is a temporary monopoly granted by the government -- it creates the legal fiction that a piece of writing or composing (or, as technologies were created, a recorded performance) is property and can only be sold by those who have been licensed to do so by the copyright holder.

Without copyright, once a work was performed or printed, other people who saw or heard or read it could simply do their own performance or print their own editions, and keep all the money without paying a dime to the creator of the work.

At the same time, a book or song isn't land or even corporate stock. In exchange for the private monopoly of copyright, when it expires the work is then free for anyone to perform or print or record.

Until 1978, copyright only lasted 52 years in the U.S. -- and then only if you remembered to renew it. There were other technical lapses that could result in the inadvertent loss of copyright -- it wasn't really user-friendly.

And the most obnoxious feature of the law was that some authors outlived their copyright. Their most popular works would go into public domain while they were still alive and counting on the income. It's like revoking someone's Social Security at age 72, just because they had the temerity not to die when demographics predicted they would.

Since 1978, the law was changed so that copyright lasted until a certain number of years after the author's death. So not only did the author never outlive the copyright, but the author's dependents could continue to derive income from it for some time.

Also, copyright began, not when the work was listed with the Library of Congress, but rather from the moment of creation.

But there were loopholes. If you wrote something as an employee of a company that paid you a salary for creating it, then your writing was a "work made for hire" and the copyright belonged to the company. You had no rights.

Here's where the ugly stuff begins. A lot of publishers began routinely requiring writers to sign contracts that declared that what they wrote was a "work for hire," so that the authors wouldn't own any part of their own work. Of course the companies didn't actually hire the writers and give them benefits, like real employees. It was basically highway robbery -- the companies demanded that either the writers sign their names to a lie and give up all their rights, or the company wouldn't publish it.

Only a few of us were stubborn enough to refuse to sign work for hire contracts. It was an expensive moral quibble, but I have real objections to perjuring myself and pretending that I was hired by a company when in fact I never was. If I took all the risks and wrote something on spec, then the copyright should belong to me. I'd license them to do whatever was needed, but I wouldn't, in effect, declare them to be the author of my work.

Who Are the Thieves in This House?

So it's pretty hilarious to hear record company executives and movie studio executives get all righteous about copyright. They've been manipulating copyright laws for years, and all the manipulations were designed to steal everything they could from the actual creators of the work.

Do you think these companies care about the money that the actual creators of the work are being deprived of when people copy CDs and DVDs?

Here's a clue: Movie studios have, for decades, used "creative accounting" to make it so that even hit movies never manage to break even, thus depriving the creative people of their "percentage of profits." A few have dared to sue, but most figure that it isn't worth the ill will. (The sentence "You'll never work in this town again" runs through their minds. They remember what happened to Cliff Robertson after he blew the whistle on an executive who was flat-out embezzling!)

And record companies manage to skim enormous amounts of money from ever CD sold. As you can easily calculate by going to the computer store and figuring out the price of an individual recordable blank CD. Figure that the record companies have been paying a fraction of that price for years. Then subtract that from the price of a CD. Figure the songwriters and performers are getting some ludicrously small percentage -- less than twenty percent, I'd bet -- and all the rest flows to the record company.

In other words, the people complaining about all the internet "thieves" are, by any reasonable measure, rapacious profiteers who have been parasitically sucking the blood out of copyrights on other people's work.

And I say this with the best will in the world. In fact, these companies have expenses. There are salaries to pay. Some of the salaries are earned.

But remember that huge fortunes like, say, David Geffen's were made by getting ownership of record publishing companies. Count on it -- Geffen got a lot richer than any but a handful of the actual performers. And when their careers are over, the record company owner keeps right on earning.

Not only that, but the digital technologies that allow perfect-quality copying came as a huge windfall to the studios and record companies.

I basically replaced all my vinyl records and cassette tapes with CDs, and then replaced all our VHS tapes and laserdiscs with DVDs. The record companies and studios would have laughed if somebody said, "This is just an upgrade. I should be able to turn in my vinyl and cassettes for CDs and my videotapes for DVDs, for no more than the actual cost of production." Ha ha ha ha ha.

In all the ridiculously overblown "estimates" of how much the studios and record companies are "losing" from "piracy," nobody bothers to calculate just how much extra money they made from consumers paying full price for music and movies they had already paid full price for only a few years before.

That's all right, you see, because that helps the companies' bottom line, whereas piracy hurts it.

But how much?

The Hit-Making Machine

The real pirates -- people who make knock-off copies of CDs and DVDs and sell them in direct competition (or in foreign markets) -- make a lot of money in some markets, but most of those are overseas. It's a problem, but some reasonable combination of private investigation and police work and international treaties should deal with that.

Internet "pirates," though, usually are more like a long-distance group that trades CDs around.

If you got together with a few of your neighbors and each of you bought different CDs and then lent them to each other, that wouldn't even violate copyright.

In fact, the entire music business absolutely depends on the social interaction of kids to make hits. You stop kids from sharing music, and you've shut down the hit-making machine.

Copyright violation comes from the fact that digital copies -- even the compressed MP3 format -- are nearly perfect. And when you "lend" your copy to someone over the internet, you still have your original. And he can lend to ten more or a hundred more or a thousand more, and the record company is only paid for that first copy.

Well, that's not a good thing -- if that became the primary way music was published.

The record companies swear that it's making a serious inroad on sales, and they can prove it. How? By showing that their sales are way down in the past few years.

It couldn't possibly be because (a) most of us have already replaced all our old vinyl and cassettes, so all that windfall money is no longer flowing in, or (b) because the record companies have made some really lousy decisions as they tried to guess what we consumers would want to buy.

It couldn't possibly be that they've targeted all their marketing at precisely the market segment -- high school and college students -- who are most likely to be sharing MP3s over the internet.

Maybe if they started marketing more music that people my age would enjoy, they'd find that, lo and behold, there are customers who prefer to buy music the legal way!

It's All Happened Before

The irony is that we've played out this whole scenario before, more than once. When radio first started broadcasting records instead of live performances, the music publishing industry became livid. This was going to hurt sales! A compromise was reached whereby radio stations paid small fees to the publishers for each playing of a record.

But the truth is that it's a lot of bother for nothing. Radio didn't hurt record sales. Radio made record sales, because people wanted to own the records they heard on the radio. Radio let people hear musicians they might never have found otherwise.

Same thing with TV and movies. Yes, TV wiped out the B-movie market segment and it killed newsreels -- but it opened up a lucrative aftermarket that kept movies alive long after they would have stopped earning money. That's how Wizard of Oz and It's a Wonderful Life and many other movies became American icons.

And again, with the VCR, studios were terrified that people would tape things off the air and stop paying money for movies. (And the TV networks were terrified that people would tape shows and skip over the ads; they didn't realize that most of us are too lazy to skip over commercials.)

And rental videotapes! That was the end of the world!

When the studios finally stopped charging ninety bucks for a videotape, they discovered that the videotape (and now DVD) aftermarket was often bigger than the original theatrical release.

The internet is similar, but not identical, to these situations.

First, most of the people who are getting those free MP3s would not be buying the CDs anyway. They're doing this in order to get far more music than they can actually afford. That means that if they weren't sharing MP3s online, they would simply have less music -- or share CDs hand to hand. It does not mean that they would have bought CDs to get the tunes they're downloading from Napster-like sharing schemes.

That's why I laugh at their estimates of "lost sales."

Go to Part 2

Copyright © 2003 by Orson Scott Card.

09-24-2003, 09:43 PM	#7 (permalink)
redravin40 Loser Location: With Jadzia	For those of you who don't feel comfortable clicking links. Art Watch First appeared in print in The Rhinoceros Times, Greensboro, NC -------------------------------------------------------------------------------- By Orson Scott Card September 7 2003 MP3s Are Not the Devil Since every penny I earn depends on copyright protection, I'm all in favor of reasonable laws to do the job. But there's something kind of sad about the recording industry's indecent passion to punish the "criminals" who are violating their rights. Copyright is a temporary monopoly granted by the government -- it creates the legal fiction that a piece of writing or composing (or, as technologies were created, a recorded performance) is property and can only be sold by those who have been licensed to do so by the copyright holder. Without copyright, once a work was performed or printed, other people who saw or heard or read it could simply do their own performance or print their own editions, and keep all the money without paying a dime to the creator of the work. At the same time, a book or song isn't land or even corporate stock. In exchange for the private monopoly of copyright, when it expires the work is then free for anyone to perform or print or record. Until 1978, copyright only lasted 52 years in the U.S. -- and then only if you remembered to renew it. There were other technical lapses that could result in the inadvertent loss of copyright -- it wasn't really user-friendly. And the most obnoxious feature of the law was that some authors outlived their copyright. Their most popular works would go into public domain while they were still alive and counting on the income. It's like revoking someone's Social Security at age 72, just because they had the temerity not to die when demographics predicted they would. Since 1978, the law was changed so that copyright lasted until a certain number of years after the author's death. So not only did the author never outlive the copyright, but the author's dependents could continue to derive income from it for some time. Also, copyright began, not when the work was listed with the Library of Congress, but rather from the moment of creation. But there were loopholes. If you wrote something as an employee of a company that paid you a salary for creating it, then your writing was a "work made for hire" and the copyright belonged to the company. You had no rights. Here's where the ugly stuff begins. A lot of publishers began routinely requiring writers to sign contracts that declared that what they wrote was a "work for hire," so that the authors wouldn't own any part of their own work. Of course the companies didn't actually hire the writers and give them benefits, like real employees. It was basically highway robbery -- the companies demanded that either the writers sign their names to a lie and give up all their rights, or the company wouldn't publish it. Only a few of us were stubborn enough to refuse to sign work for hire contracts. It was an expensive moral quibble, but I have real objections to perjuring myself and pretending that I was hired by a company when in fact I never was. If I took all the risks and wrote something on spec, then the copyright should belong to me. I'd license them to do whatever was needed, but I wouldn't, in effect, declare them to be the author of my work. Who Are the Thieves in This House? So it's pretty hilarious to hear record company executives and movie studio executives get all righteous about copyright. They've been manipulating copyright laws for years, and all the manipulations were designed to steal everything they could from the actual creators of the work. Do you think these companies care about the money that the actual creators of the work are being deprived of when people copy CDs and DVDs? Here's a clue: Movie studios have, for decades, used "creative accounting" to make it so that even hit movies never manage to break even, thus depriving the creative people of their "percentage of profits." A few have dared to sue, but most figure that it isn't worth the ill will. (The sentence "You'll never work in this town again" runs through their minds. They remember what happened to Cliff Robertson after he blew the whistle on an executive who was flat-out embezzling!) And record companies manage to skim enormous amounts of money from ever CD sold. As you can easily calculate by going to the computer store and figuring out the price of an individual recordable blank CD. Figure that the record companies have been paying a fraction of that price for years. Then subtract that from the price of a CD. Figure the songwriters and performers are getting some ludicrously small percentage -- less than twenty percent, I'd bet -- and all the rest flows to the record company. In other words, the people complaining about all the internet "thieves" are, by any reasonable measure, rapacious profiteers who have been parasitically sucking the blood out of copyrights on other people's work. And I say this with the best will in the world. In fact, these companies have expenses. There are salaries to pay. Some of the salaries are earned. But remember that huge fortunes like, say, David Geffen's were made by getting ownership of record publishing companies. Count on it -- Geffen got a lot richer than any but a handful of the actual performers. And when their careers are over, the record company owner keeps right on earning. Not only that, but the digital technologies that allow perfect-quality copying came as a huge windfall to the studios and record companies. I basically replaced all my vinyl records and cassette tapes with CDs, and then replaced all our VHS tapes and laserdiscs with DVDs. The record companies and studios would have laughed if somebody said, "This is just an upgrade. I should be able to turn in my vinyl and cassettes for CDs and my videotapes for DVDs, for no more than the actual cost of production." Ha ha ha ha ha. In all the ridiculously overblown "estimates" of how much the studios and record companies are "losing" from "piracy," nobody bothers to calculate just how much extra money they made from consumers paying full price for music and movies they had already paid full price for only a few years before. That's all right, you see, because that helps the companies' bottom line, whereas piracy hurts it. But how much? The Hit-Making Machine The real pirates -- people who make knock-off copies of CDs and DVDs and sell them in direct competition (or in foreign markets) -- make a lot of money in some markets, but most of those are overseas. It's a problem, but some reasonable combination of private investigation and police work and international treaties should deal with that. Internet "pirates," though, usually are more like a long-distance group that trades CDs around. If you got together with a few of your neighbors and each of you bought different CDs and then lent them to each other, that wouldn't even violate copyright. In fact, the entire music business absolutely depends on the social interaction of kids to make hits. You stop kids from sharing music, and you've shut down the hit-making machine. Copyright violation comes from the fact that digital copies -- even the compressed MP3 format -- are nearly perfect. And when you "lend" your copy to someone over the internet, you still have your original. And he can lend to ten more or a hundred more or a thousand more, and the record company is only paid for that first copy. Well, that's not a good thing -- if that became the primary way music was published. The record companies swear that it's making a serious inroad on sales, and they can prove it. How? By showing that their sales are way down in the past few years. It couldn't possibly be because (a) most of us have already replaced all our old vinyl and cassettes, so all that windfall money is no longer flowing in, or (b) because the record companies have made some really lousy decisions as they tried to guess what we consumers would want to buy. It couldn't possibly be that they've targeted all their marketing at precisely the market segment -- high school and college students -- who are most likely to be sharing MP3s over the internet. Maybe if they started marketing more music that people my age would enjoy, they'd find that, lo and behold, there are customers who prefer to buy music the legal way! It's All Happened Before The irony is that we've played out this whole scenario before, more than once. When radio first started broadcasting records instead of live performances, the music publishing industry became livid. This was going to hurt sales! A compromise was reached whereby radio stations paid small fees to the publishers for each playing of a record. But the truth is that it's a lot of bother for nothing. Radio didn't hurt record sales. Radio made record sales, because people wanted to own the records they heard on the radio. Radio let people hear musicians they might never have found otherwise. Same thing with TV and movies. Yes, TV wiped out the B-movie market segment and it killed newsreels -- but it opened up a lucrative aftermarket that kept movies alive long after they would have stopped earning money. That's how Wizard of Oz and It's a Wonderful Life and many other movies became American icons. And again, with the VCR, studios were terrified that people would tape things off the air and stop paying money for movies. (And the TV networks were terrified that people would tape shows and skip over the ads; they didn't realize that most of us are too lazy to skip over commercials.) And rental videotapes! That was the end of the world! When the studios finally stopped charging ninety bucks for a videotape, they discovered that the videotape (and now DVD) aftermarket was often bigger than the original theatrical release. The internet is similar, but not identical, to these situations. First, most of the people who are getting those free MP3s would not be buying the CDs anyway. They're doing this in order to get far more music than they can actually afford. That means that if they weren't sharing MP3s online, they would simply have less music -- or share CDs hand to hand. It does not mean that they would have bought CDs to get the tunes they're downloading from Napster-like sharing schemes. That's why I laugh at their estimates of "lost sales." Go to Part 2 Copyright © 2003 by Orson Scott Card.