Government imposition of specific business models on creators

My first draft of the op-ed for Georgia Straight was far too long, and included not only discussion of digital locks but also commentary about government imposing royalty-based business models. It also used Georgia Straight articles by Bill Henderson and Marian Hebb as illustrations. I'm including here that last part that needed to be cut out of the op-ed.

The Straight article noted that as the policy coordinator I authored a summary of our copyright policy which we hand out to politicians.

Our top issues are:


  • We disagree with the legalization or legal protection of techniques used by copyright holders to encode their content such that it can only be accessed with "authorized" technology brands.

  • We disagree with the legalization or legal protection of techniques used by device manufacturers to lock down devices such that their owners are considered attackers, where someone other than the owner controls the keys, or where owners are otherwise not able to control their technology for lawful or make their own software choices. Hardware owners must be able to make their own software choices, in order to chose our software.
  • We disagree with government promotion or mandating of royalty-based business models over fixed-cost based models used in peer production and peer distribution such as FLOSS.
  • Our third priority issue is government imposition of specific business models. This issue is more complex given that for some forms of creativity there is one business model that is satisfactory for the majority of creators, while in others there is competition between business models. In the case of software we know that the most visible Business Software Alliance (BSA) members like Microsoft will list Linux and FLOSS as their greatest competitive threat. Given this it should be obvious that governments should not be imposing or favoring BSA member business models over those of their competitors.

    Recorded music is an area where composers and performers already make most of their revenues from royalty schemes for the use of music on radio or performances in public places (bars, etc). Extending this to uses on the Internet, as proposed by Songwriters Association of Canada vice president Bill Henderson, makes sense. There are some details that need to be worked out, such as whether the system is voluntary or imposed on audiences. In my case I am a subscriber to eMusic, and I do not download or "share" music otherwise. I want my money to favor those forward-looking artists who make their music available through eMusic, and would prefer my money not to go to the major labels who promote attacks against property rights holders as discussed above.

    Standing in the way of the songwriters isn't the 'straw man' music fan that allegedly doesn't want to pay for music, but the major record labels who don't want to give up control over the marketing, distribution and funding of music to a system that will greatly benefit songwriters and performers. (See the Straight article by Graham Henderson where he made up statistics and ignored the very existence of eMusic to support his claims.)

    The article by copyright lawyer Marian Hebb demonstrates some of the confusions. She expressed support for Bill C-60 and C-61 which were focused on 1996 WIPO treaty ratification. The 1996 WIPO treaties were an example of "policy laundering" ideas that came from the USA's 1995 National Information Infrastructure (NII) process. In this case the US government invited a number of the historically successful content distributors and asked them what the rules should be for the Internet. For obvious reasons they suggested rules which would protect their established businesses from legitimate competition. While this may seem good for those legacy companies, this should not be confused with policy that would be helpful to creators or the emerging knowledge economy as a whole.

    If one did a word count of these two previous Canadian copyright bills it was clear that legal protection for the digital locks we have already discussed was the focus of these bills. These foreign locks are harmful to the interests of Ms. Hebb's clients. She referenced the same laundered statistics that caused embarrassment to the Conference Board of Canada when they plagiarized them, not clarifying that these statistics as well as the claim that Canada is a "piracy haven" are without merit. The source of these statistics are the same incumbent industry lobbiests that gave us the NII policy. The reality is that in many ways Canadian copyright law is already stronger (meaning tilted in favor of past copyright holders) than some of our trading partners, including that of the United States.

    When I speak to some of the creators Ms. Hebb represents, I have a familiar conversation. They suggest that Canadian copyright law is "weak" and needs to be fixed. I ask them what activities they feel should be illegal, and they list a number of scenarios that existing strong Canadian copyright law already covers. I ask them how making new activities illegal will help then when existing strong copyright law seems to not be sufficient. It turns out that creators have been misinformed by the same statistics that the politicians have. This misinformation has likely caused potential infringers to also incorrectly believe Canadian law is 'weak', and not realize that the activities they are carrying out are already infringing. It is clear that this misinformation is harmful, and that correction of this misinformation is needed -- not radical changes to the law.

    The proposals for collective licensing for "publicly accessible materials" may seem reasonable at first glance, except when one does the economic analysis. Those creators represented by collective societies such as Access Copyright represent a tiny fraction of creativity online. Much of the material from Access Copyright members are already behind "pay for access" services, so do not fall under "publicly accessible materials". The vast majority of works which are "publicly accessible" on the Internet were intended to be accessed royalty free by their creators, and often use motivation structures and business models which are incompatible with royalty collection. This suggests that what is being proposed is for a subset of creators to be collecting royalties when people access someone elses works.

    When we focus on the educational sector we see where the root of the problem is. Educational publishers dominate collective societies such as Access Copyright, and on the other side we have educational institutions who want a "free for all" for these institutions. I disagree with the proposals from both of these groups. In other jurisdictions not as dominated by institutional exceptions or collective societies we see faster growth of a third option known as "open access". In this scenario the educational institutions would pay authors and editors an appropriate one-time fee for their critical services, and then the material is licensed such that redistribution is legally free. In some cases the projects allow for open collaboration as well, allowing educational material to become similar to FLOSS which has already proven to be increasingly successfully in the marketplace. This is a market based solution that would solve the problems for both authors who will get properly paid, as well as well as educational institutions dealing with decreasing budgets. This is a win-win for nearly everyone, except the educational publishers who would no longer be able to extract large fees from our educational budgets based on Canada lagging in modernizing the production, distribution and funding of educational material.