INTELLECTUAL PROPERTY IN THE INFORMATION ERA
For PAd 261, Professor Catron By Selena Sol
The concept of Intellectual Property rights emerged as a public policy device relative to social, economic, and political forces and sculpted by a particular technology, the printing press. Given the growing influential role of information and the vast structural changes affected in the metamorphosis from an industrialized to an informationalized world, we must ask whether the policy goals and structures of the Intellectual Property system, conceived in an agrarian, print-dominated society, remain relevant today.
This paper discusses changes in the cultural context within which we create Intellectual Property policy. Specifically, this paper notes changes in the tools for creating and marketing information, the importance of information in economic and social life, the demands of information and communication technologies on Intellectual Property enforcement, and th philosophic givens of the Intellectual Property system.
In light of such drastic changes, this paper concludes by suggesting new givens and new tools for Congress to consider in formulating Information Policy in the Information Era. Such policy must include both a short-term and a long-term analysis and address new social demands.
"The medium, or process, of our time-electronic technology-is reshaping and restructuring patterns of social interdependence and every aspect of our personal life. It is forcing us to reconsider and reevaluate practically every thought, every action, and every insti- tution formerly taken for granted." - Marshall McLuhan from The Medium is the Massage
Throughout history, the evolution of societies has been driven by many forces. And many are they who have tried to direct and influence this evolution with policy and law. Yet, however well-crafted were those laws and policies, never have they provided permanent solutions to any of our problems. Because development is always advanced by the creativity and curiosity implicit to humanity, and because our physical, social, political, technological and ideological "environment" is in constant flux, the path of social evolution can never really be predicted or institutionalized. New opportunities will forever materialize and new environments will always demand corresponding legal and policy institutional metamorphosis. In short, society must continually hold its social institutions up to criticism and either demand that they adapt to new environments or toss them on the historical policy scrap heap. Like biological species, societies which fail to adapt, fail to survive.
We stand teetering on the edge of a new age. The Information Era, blossoming about us, fed on silicon and fiber optics, affects every aspect of our society from the way we communicate with friends, to the way we teach our children, to the way we entertain ourselves, to the way we work and create. In leaps and bounds, the industrialized world is transforming into an informationalized one.
Yet we are not pulled inextricably along a pre-determined path of development. The information revolution is the first self-aware social revolution in the history of humanity. Many structural revolutions (agriculture, industry, Christianity) have previously transformed humanity and for the decades and centuries following those metamorphoses philosophers and historians have "described" the implications of the change. We, still in the maelstrom of change, have a chance to act rather than simply observe in retrospect.
Through our present policy choices we sculpt our future society. Subtle policy decisions that we make now might have profound impacts on our future world. In an era of change, such as the present era, such decisions only become more potent. Our ability to recognize and utilize our opportunities, will determine what future we leave our children and grandchildren. The key question therefore, is how will we restructure our society for the altered prerequisites of the Information Era ?
THE IMPORTANCE OF INTELLECTUAL PROPERTY POLICY
"Powerful new technologies are obviously transforming the ways in which Americans express themselves, communicate information and push back the frontiers of science....The question before Congress is whether our in- tellectual property laws and institutions can carry the burden." - Senator Charles McMathias before the Subcommittee on Patents, Copyrights and Trademarks
As our society continues its transformation into an information society, it is particularly crucial that we deal successfully with new demands on Intellectual Property policy. Through Intellectual Property we define how information, the primary resource of the new Era, will be conceptualized and realized...whether it should be considered an economic commodity or a societal resource.
Should we be able to own information as we own a car or a house? If so, what limitations will we impose on ownership? How will information owners be protected? How will society be protected from information owners? Answering these questions is not trivial. Because information has become central tomost modern cultural activities, our decisions on how to define information may be decisions about international affairs, commerce, communication and entertainment policy, privacy, or the distribution of wealth and social status.
Although Congress has traditionally been able to incorporate new technologies into old Intellectual Property policies, the rapid acceleration of technological development, and the novel nature of the change it initiates, pose serious problems for the traditional system. Such changes, for example, have created new interest groups and motivated old interest groups with new, but valid and important, claims.
For example, traditional Intellectual Property owners are concerned with how their works will be protected and in what ways creation and distribution will be restructured. Artists, publishers, producers, and distributors call for stronger enforcement of their rights in an age of easy, quick, and perfect copy technology. On the other hand, the newly created industry of information processors like database producers, information analysts, or music sample artists who re-compile and re-create existing information for new and novel purposes, oppose restrictions. They argue that though they use existing creations, by recompiling them, they are creating anew, adding value to the information, and therefore deserve profit as well. Finally, the general public wants assurance that they will be able to use the information which is becoming integral to life at a fair price and that such information is available to all who need it. Though it is a truly wicked problem, addressing the conflicting needs of society is crucial.
In understanding how to respond to the new demands on the Intellectual Property system however, we must first understand what the system hopes to achieve in the first place and why it has developed the way it has. By looking to the Constitution, we can better understand the goals of the American Intellectual Property system. Similarly, by studying the Intellectual Property system as a product of historical/structural forces, we can better understand why the Intellectual Property system exists in the form that it does and better determine whether new demands for change are demands of degree rather than of kind. If the Information Era changes are only changes of degree, we should be able to work within the current system. If the changes are changes of kind however, we must consider altering the basic structure of Intellectual Property policy to meet new demands.
THE TRADITIONAL AMERICAN INTELLECTUAL PROPERTY SYSTEM
"The Congress shall have the power to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries -Article I, Section 8 US Constitution
"The enactment of copyright legislation by Congress under the terms of the Constitution is not based on any natural right that the author has in his writings... but on the grounds that the welfare of the public will be served and progress of science and useful arts will be promoted.." - Excerpt from the 1909 Copyright Act
The concept behind the American Intellectual Property system is fairly simple. The government grants ownership rights to authors and inventors for a limited amount of time. And that is it. Traditional Intellectual Property policy is simply to set the rules and let the marketplace govern the players. The catch however, is that in order to utilize the government-granted Intellectual property rights, creators must transform their ideas into tangible "products". Authors must publish and inventors must fashion inventions. In both cases, owner profits are based on disseminating ideas to the public, which is the primary goal of Intellectual Property rights. This symbiotic relationship, crafted by James Madison, was based on the idea that neither the author's nor the public's interests would be subordinated because both were mutually supportive. By giving authors and inventors a monetary stimulus for inventing and creating, society would continue to advance and create.
Further, because copyrights and patents are only valid for a limited time, valuable information would be totally transferred to public ownership [non-ownership] after the creator had been given enough time to make a profit proportional to his/her investment. Hence, the evils of monopoly inherent in the idea of rights to ownership could be avoided. In the end, all parties were served.
INTELLECTUAL PROPERTY HISTORICALLY
"An intellectual property system is made up of laws and practices [which] reflect the larger society of which it is part. For, although intellectual pro- perty rights have been recognized in natural law, historically, governments have granted such rights to achieve a variety of policy goals. Which policy goal...depends...on history, circumstances, and the overriding needs of society." - OTA report on Intellectual Property in an Age of Electronics and Information
The second aspect of Intellectual Property policy we should understand is its historical/structural development. Historically, social, economic, political and technological factors have all influenced the evolution of the Intellectual Property system. Such relationships are particularly apparent when viewed over time. Hence, we should look not only at how the American system actually coalesced into law, but also, at the process of its formation.
For the idea of Intellectual Property to arise in the first place, there were certain prerequisites. In Genesis of American Patent and Copyright Law, Bruce Bugbee identifies these prerequisites as the following: a centralized political authority and a government that intervened in economic affairs; the development of trade and commerce; a market for literature, art and invention; and the growth of the idea of and respect for the individual as creator. Furthermore, as is now the case, technology played a major part. In many ways the codification and development of Intellectual Property rights was a response to the major social, economic and political changes brought about by the development of the printing press. Hence, it is no coincidence that formalized Intellectual Property laws developed during the European Middle Ages in which the social/technological prerequisites were all present.
Unleashed in the late Middle Ages, the printing press had several market advantages over the traditional monk-based craft system of literary reproduction and several associated social ramifications. Printing press production was fast and cheap and, as such, greatly enhanced the dissemination of ideas as publishers sought to make more money by producing more books. With this greater flow of information, however, came an increasing level of literacy and a newfound appreciation of the diversity of ideas and opinions. Freed from the restraints of a religious monopoly, Europe took its first steps towards the Renaissance and the Age of Enlightenment.
Timing was crucial. The development of the printing press coincided with an age of religious and political turbulence. Printing presented the European monarchs with a serious political challenge. As McLuhan notes in the Medium is the Massage, "...it created a portable book, which men could read in privacy and isolation...Man could now inspire---and conspire." Yet equally as revolutionary were the economic possibilities of the press which created the first "mass-produced" information commodity. The voracious European appetite for knowledge could translate directly into money and power for the monarch who dared master it.
Hence, Intellectual Property policy was born in tension. Created to deal with the threat of revolutionary ideas, as well as to take advantage of economic opportunity, early Intellectual Property law reflected a balance between censorship of the press and regulation of the expanding printing trade.
Early on, for example, the English government struck deals with publishers. Copyrights were initially granted to publishers if they agreed to uphold strict censorship guidelines. However, such a bargain was time sensitive and valid only as long as all players remained constant in their needs and expectations. Hence, it was not long before Intellectual Property policy was forced to evolve. Following the Restoration, the danger of publishers' monopolies was more the focus of the English government than censoring seditious or heretical material.
As a result, Parliament did not renew the licensing Act of 1692. Without government acknowledgement of copyrights, however, the book trade was thrown into chaos. Such a short- sighted policy decision was, of course, unacceptable. Parliament quickly concluded that Intellectual Property policy tethered divergent monsters which unrestrained could wreak havoc on their society. The resulting policy compromise was the Statute of Anne.
Although the Statute of Anne reasserted many aspects of the old publishers' copyright system, it also codified the idea of author's right, an idea which had begun to find social legitimacy in the writings of Locke and other Enlightenment thinkers. Hence, publishers could still count on a stable market system, and society would not have to fear the dangers of publishers' monopoly of ideas.
What this story tells us is that the concept of Intellectual Property rights emerged as a public policy device relative to social, economic, and political forces and sculpted by a particular technology, the printing press. Given the growing influential role of information and the vast structural changes affected in the metamorphosis from an industrialized to an informationalized world, we must ask whether the policy goals and structures of the Intellectual Property system, conceived by an agrarian, print-technology dominated society, remain appropriate.
DESCRIPTIONS AND IMPLICATIONS OF THE NEW INFORMATION ENVIRONMENT
"When I write of an ontological shift. I mean more than a change in how we humans see things, more than a paradigm shift or a switch in our epistemological stance. Of course, our access to knowledge changes dramatically as we computer- ize....But there are more things in heaven and earth than are dreamed of in our epistemology. An ontological shift is a change in the world under our feet, in the whole context in which our knowledge and awareness are rooted." - Michael Heim The Metaphysics of Virtual Reality
In examining the changing environment in relation to Intellectual Property policy, there are three areas of particular interest. Firstly, because rights are only as valid as they are enforceable, we must consider how issues of enforcement affect the Intellectual Property system. Also, since Intellectual Property policy reflects a balance between the market place, the creator, and the public, we must consider how the Information Era effects the marketplace and the process of creation with respect to the public good. Finally, we must clarify what information really is and how best to "work with it" in its new environment.
ENFORCEMENT ISSUES IN THE INFORMATION ERA
On three fronts, Information Era technologies pose serious threats to the enforcement of Intellectual Property rights. Technology is making the reproduction and manipulation of information cheaper, faster and more private. Hence, intellectual theft becomes more trivial and Intellectual Property rights less enforceable.
Traditional Intellectual Property was enforceable because to make money on an idea, one had to transfer one's idea into a tangible product, the exchange of which could be enforced in the marketplace. A book, for example, required a printing press, not a trivial investment, and lent itself to attaching author and publisher names and copyright symbols. Further, distribution was fairly obvious; if you suspected Intellectual Property theft, you needed only to go the book shop, identify the culprit and apply punishment. Given the technology, Intellectual Property enforcement was convenient.
New information and communication technologies however, are changing this convenient situation. Cheap, easy-to-use technology makes duplication, cutting and pasting, and mass, private distribution a simple matter. The Intellectual Property "thief" need only photocopy a work, scan it to hard drive and upload it anonymously onto the Internet where it can be instantaneously accessed by millions worldwide. In such a situation, it becomes extremely problematic, if not impossible, to enforce Intellectual Property rights. At best, you'll scare off a few and at worst you'll martyr a few. On the one hand, the sheer volume and speed of Intellectual Property theft threatens to overwhelm the most diligent policing of Intellectual Property. On the other hand, as information markets become more based in the privacy of one's home, it becomes less possible to detect, control, and verify infringements of Intellectual Property law. Simply putting stricter regulations and imposing greater fines is useless in a situation of unenforceablity.
Today's computer and media networks combined with home recording devices not only make Intellectual Property "theft" child's play, but they cause consumers to doubt the very legitimacy of Intellectual Property claims. Have you ever made a compilation tape to listen to on your way to work? Have you ever taped a movie from HBO? Have you ever copied a program from your home computer to your office computer, or even given a copy to a friend? Have you ever worried about the Intellectual Property police arresting you because of it? If you answered yes to any of these questions, don't feel bad, you're far from alone. One OTA survey showed, "that at least seven in ten people believe that copying personal possessions, like a record or a program is acceptable behavior."
Yet, if Intellectual Property rights cannot be enforced, how can we assure that creators are rewarded and thus inspired. Though "private use" is different from "pirate use" in that private use is not a commercial activity in direct market competition at the expense of the creator, when considered in total, the private use of the many might have the same effect as pirate use: creators might lose their financial incentive to create. Though laws are only as useful as they are enforceable, simply admitting defeat is not the answer. Congress needs to provide a new, enforceable incentive system in place of Intellectual Property.
INFORMATION ERA MARKETS AND ECONOMICS
Just as we must understand how the information environment affects the legal aspect of Intellectual Property, we must also consider how it is affected by similar changes in the economic realm. Here, two major changes pose serious challenges to the traditional Intellectual Property system. These changes include: 1) the increasing power of the artist in the market and 2) collaboration and knowledge sharing replacing individualism and knowledge hoarding as the paradigm of the industrial sector.
Cheap, powerful, and simple technological tools are making the artist a major player in the economics of ideas. No longer is artistic compensation dependent on the huge institutionalized publishing and distributing system typical of the past. Information Era technologies allow artists to produce a finished work of high quality with little technical prowess or capital investment. For two thousand dollars, for example, a musician might produce an endless number of digital CD quality recordings in a basement without paying 40-100 dollars an hour at a recording studio. In fact, the role of "independents" in the music industry has grown steadily in the late eighties and nineties.
Further, aside from being able to produce professionally, the artist can also publish and distribute using electronic networks that transmit text, sound, or images. "The result" as the Office of Technological Assessment's (OTA) report on Intellectual property in an Age of Electronics concludes, "is that roles once held by several people are now held only by one person. Starting with a single copy of a letter, article, picture or musical composition composed at a computer and transmitted to readers at the other end of the network, one person can become author, printer, publisher, and distributer of work." Thus market rewards need not cover costly production costs or be divided with an ever-hungry publishing company. Hence, when considering new systems for providing incentives, we must consider that artists' profits systems are also changing.
A second change in the economic environment is that of collaboration. In The Machine That Changed The World, Womack and others describe how the Japanese system of 'lean production' is changing the way all businesses think about production. Though the system of lean production is beyond the scope of this policy analysis, Womack's discussion of information mobility is particularly pertinent. In complex industries typical of the Information Era, like electronics and automobiles, information must be mobile so that corporations can 1) meld technologies from diverse fields, and 2) remain agile in the marketplace.
In complex production it is increasingly important to mesh diverse technical know how. A complex industry like automobile production for example, requires microchip components, materials research, marketing strategies, engineering, machine workers etc.... Each of these diverse fields must be fused, and fused concurrently, into a complex product of some 10,000 parts or more. Any damming of information reduces a company's ability to fuse information and hence, reduces a its marketplace viability. The auto companies not up-to-date with the latest information technologies developments are not up-to-date in the auto industry. And just as lean manufacturers demand information mobility, so too do lean suppliers, at the top of their own production pyramids.
Japanese manufacturers like Toyota have developed strong ties even between competing firms to lubricate the information pipeline. This is possible because marketplace viability is not necessarily based on what you know as much as on what you can do with it. Reverse engineering, for example, is only valuable if you have the organizational learning necessary to transform data into product. Plus, you must reverse engineer it and produce it yourself before you have lost market share or before the end of the ever-shortening product cycle. Information Era manufacturing is not simply a matter of copying. Free information allows the lean-organized company to achieve its greatest potential while not necessarily giving competitors any great advantage.
Just as information mobility is necessary in the manufacturing system, so too is it necessary in the broader marketplace. As industry becomes more complex and customer demands more diverse, lean production shows that old systems of mass production are outdated. Companies must be agile in the new marketplace. Agility requires that no resources become fixed or institutionalized. Companies need an open environment in which to combine and recreate. Womack shows that in the post mass- market age success in the market is quickly becoming a factor of fast product cycles, lock-in, customer loyalty, and market share. Lean companies, he explains, must meet specific customer demands, develop life-long relationships with them, and flood the market with their products if they hope to be around for the next round of market competition. Money is to be made in process and service rather than in the production of commodities.
Because the mass production systems relied on having a specific product reproduced over and over, the Intellectual Property system was necessary to protect that form until profits could recoup investment in the production process. However, in the Information Era, Intellectual property policy only hinders efficient production.
THE CREATIVE ENVIRONMENT IN THE INFORMATION ERA
The swiftly evolving creative environment, both the processes of creation and changes in the social role of creators, also challenges traditional notions of Intellectual Property. In this new environment fluidity and interactivity have become increasingly important and will affect the relationship between incentives, creators, and creations. Such changes have important implications on Intellectual Property policy.
Firstly, the development and use of new tools both opens new avenues of creation and changes the old methods. This is not specific to the Information Era of course. Such a change in process was also instigated by the previous Print Revolution. In pre-Guttenberg/pre-ever-scribbling monk days, for example, authorship as we know it today, was virtually unknown. The stories of cultures passed from the mouth of the storyteller to the ears of the audience. There was no authoritative version and the stories were fluid, changing from day to day from year to year and from culture to culture. Because the story was never frozen in print, it made no sense to think of "owning" a story. How could one own an idea; it was a gift shared by all and transformed by all. Because we are reared within a culture, there can never be a truly novel thought, for all our experiences are tempered by a cultural tradition and filter. At best, there can be only individual versions of a "culturally-owned" idea. Such is the ethic of an oral culture.
Once the printing press was developed of course, anonymity and sharing gave way to private ownership and individual effort. The printing press paved the way for the individual "author", for through the press, it became possible for a single author to produce and distribute a work without the communal efforts needed in previous ages.
Now however, new technologies are once again changing the creative landscape. Information technology is a world of cutting and pasting, sampling and remixing. The Information Era creator is not so much a creator as a re-creator. The creative process is once again fluid and interactive like in the days of old. Just as the printing press and the publishing industry produced "the author", so might electronic networking un-produce her. Like the stories of Homer, electronic works on the net are works still in progress, with multiple authors, each at different stages of revising the work. In the December 1994 issue of Scientific American, Gary Stix writes,
"Every day 20,000 or so electronic mail messages carry the abstracts of new papers stored in the computer's databases to more than 60 countries. Readers of the summaries then download thousands of copies of the full papers. The Internet has become the world's biggest blackboard. As this phenomenon emerges the definition of scientific collaboration may change. Commentators on articles virtually become members of the research team."
Hence, as in the days prior to the printing press, originality of authorship will be hard to verify, and must, by virtue of its ambiguity, eventually become less of an issue. However, the Intellectual Property system has no tool to deal with works that do not necessarily have an obvious "author". The present Intellectual Property system, as a societal tool, based on economic rewards to foster creativity, requires that authorship be clearly identified. If the process of creation in the Information Era runs counter to the idea of authorship by fostering collaboration, the continual evolution of works, and focussing on performance rather than product, the question is, what new policies will provide incentives for future creators.
INFORMATION IN THE INFORMATION ERA
Perhaps the most damning flaw of the traditional Intellectual Property system in the Information Era stems from its definition of information itself. As information becomes freed from tangible shells such as books or widgets, it poses serious challenges to the traditional Intellectual Property system, which is based on the assumption that ideas are solidified in tangible products. The beauty of Madison's "convenient coincidence" was that the Intellectual Property system was less about ideas as it was about tangible products. A creator got paid for his ability to transform an idea into a marketable product. Since ideas and products were realistically inseparable, there was no problem. Ideas, by way of products, could be priced, sold, owned, and hence could be disseminated for the good of the public.
Now, however, intangible information is being freed of its tangible product. In cyberspace, information takes on a more fluid digital form. As this occurs it becomes necessary to understand information in its natural state, rather than as a tangible product, because in its pure form, information has various properties which contradict certain givens of the market and resist commodification.
Unlike "data," information is more of an activity than a "thing"; it is a process which happens in the nexus between minds; it is experienced rather than possessed; it is something that happens "to" you. Hence, the ownership of pure information becomes problematic. How can one own a constantly evolving process?
Further, unlike tangible property, information stays with and affects everyone who comes in contact with it. That is, it is not something you can 'give away'. People can gain information from you, but they cannot deprive you of it; you'll always have the information. Even if you "forget" it, your synapses have been irrevocably sculpted. Unlike a horse which you cannot ride once you sell, the information you acquire is always yours no matter how many people you share it with. Hence, information defies traditional market distribution. Rather, it spreads like a virus, a complex and unpredictable fractal.
Also, information has a tendency to "leak". That is, it "wants" to move and change. John Perry Barlow quips, "Trying to stop the spread of a really robust piece of information is just as easy as keeping killer bees south of the border." And like a great telephone operator game, information will change as it moves. As in the days of old, information will evolve with each telling and each interpretation.
Finally, there is no way to easily determine a set value for information. The value depends on the case and is relative depending on time and distance from the source. For instance, last week's second hand stock information is of little value to today's broker though it may be very valuable to some 21st- century anthropologist. Similarly, familiarity can be more valuable than scarcity. Unlike typical commodities, information gains in power the more it is spread. As the Japanese lean production companies have learned, in the Information Era, market share is often more important than straight profit.
THE ANACHRONICITY OF INTELLECTUAL PROPERTY
"The riddle is this: if our property can be infinitely reproduced and instantaneously distributed all over the planet without cost, without our knowledge, without its even leaving our possession, how can we protect it? How are we going to get paid for the work we do in our minds? And if we can't get paid, what will assure the continued creation and distribution of such work?" - John Perry Barlow Selling Wine Without Bottles
It is clear that the demands on Intellectual Property policy are changing. The tools for creating and marketing are changing, the importance of information in economic and social life is changing, demands on enforcement are changing, and the very philosophic givens of the Intellectual Property system are changing. From all sides of the Intellectual Property issue, actors are calling for change.
New groups demand proper representation. Software developers argue, for example, that computer programs represent a new class of "functional works" which use information to describe a process as well as implement the process. Though copyright might legitimately cover description of a process, copyright cannot legitimately cover the functional aspect of functional works. That would be like protecting a cake recipe such that no other cook could bake the cake. Yet, how do you isolate the descriptive aspects and the functional aspects of computer programs? Programs are both symbolic and functional in nature.
Meanwhile, old groups like publishers continue to clamor for stricter protection. John Perry Barlow reports that last fall a group of music publishers sued Compuserve "for it having allowed its users to upload musical compositions into areas where other users might get them" even though Compuserve had no realistic way of monitoring this.
Typically, Congress has relied on the marketplace to solve Intellectual Property problems. This option has worked well so far. For instance, though the introduction of radio severely limited copyright enforcement by dispersing a performance over a wide area (making collecting at the door virtually impossible), the marketplace created the system of advertiser support, commercials, to resolve the problem. Commercials provided both a means to grant free service to the public and a means for providing incentives to creators. Creators, publisher, and distributors didn't really care that Radio, and later Television, created wholesale copyright theft daily, because they got paid regardless. Similarly, the music industry adopted the royalty system in the form of ASCAP to provide payments for radio play.
Further, publishers have tried to manipulate public opinion by alerting the public to the illegality or immorality of Intellectual Property theft whether with FBI notices or stickers or by playing on customers' sense of fairness by stressing that Intellectual Property theft takes money out of the pockets of the artists who are giving so much pleasure to their audience.
Further, companies have used their own technological weapons. These technological measures fall into three general categories. Companies might develop locks, scrambling or encryption. For example, video publishers scramble videos to confuse the automatic gain controls of VCRs such that copies are marred with visual irregularities. The idea is that copy is less an issue when copies are useless to the copier. Companies can also use technology to monitor information flow. That is, companies can "listen in" and check for Intellectual Property theft. Finally, companies, as in the pay per view case, can provide proprietary channels of distribution such that only those who pay can get access to works.
There are several advantages to the marketplace approach of course. Firstly, The marketplace is more flexible than the government and can respond much more rapidly to a fast-moving market. Further, reducing the government role avoids costly bureaucracies and enforcement programs.
However, marketplace solutions are far from ideal. Firstly, they put much demand on the marketplace By as early as 1984, for example, Warner Communications already reported losses of 2.75 billion dollars in home taping. Technology may prevent some Intellectual property theft, but it is always vulnerable to the diligent hacker or the ex-cable employee going door to door offering to "hook you up for a small cost." Further, technological measures are costly. In determining whether technological protection is profitable, one must consider how much theft it prevents compared to the cost of its implementation. And finally, technological protection may just not work, or be outdated rapidly.
Further, solutions acceptable to the market need not correspond with the interests of the public. For instance, though the electronic surveillance of monitoring broadcasts has been upheld in the courts so far, it raises serious concerns about privacy. As information technologies merge such varied activities as education, entertainment, medicine, and commerce, privacy invasion takes on a new and worrisome meaning. Who will protect consumers from the all powerful eyes of monitoring agencies?
Also, there are concerns about the relationship between large and small companies in the marketplace. The League for Programming Freedom argues, for example, that the scope of interface copyright, is so vague and potentially wide that it will be difficult for any programmer or small company to be sure of being safe from lawsuits from larger well-established companies. Customers and investors often avoid companies that are targets of suits; an eventual victory may come years too late to prevent great loss or even bankruptcy. Since this tendency is well known, big companies often take advantage of it by filing or threatening suits they are unlikely to win. Meanwhile, smaller companies don't have the capital or time to invest in costly patenting of their own.
Similarly proprietary schemes like pay per view threaten to discriminate against people who cannot afford the services. If information becomes accessible only to the rich, the Information Era will be severely crippled in its ability to better our society. Information, which is crucial to our lives, must remain accessible to all lest we add another weapon to the arsenal of discrimination.
Relying on the market is clearly a dangerous policy decision. Though we must provide incentives for creators and maintain a healthy market, new policy directions may better serve our needs than traditional, anachronistic Intellectual Property policy.
DEVELOPING INFORMATION AGE POLICY
"...the intellectual property system may no longer serve social, economic and political goals...in an information age, given the enhanced value of information in all realms of life...Congress could use policy mechanisms other than granting of intellectual property rights to foster some goals not supported by the present system." - OTA report on Intellectual property in an Age of Electronics and Information
In attempting to solve the problem of an anachronistic policy, we can either amend the policy so that it can be made to address new demands and strike a new balance between forces in society, or we can discard it and start afresh with new policies designed to cope with new problems. In the case of Intellectual Property we must consider both.
Rely on Amendment.
In addressing the needs of the Information Era, Congress could amend Intellectual Property policy by modifying portions of the existing law in hopes that, new technological dilemmas could be solved by making the present law more appropriate. In fact, Congress has used the amendment strategy before. In 1976 the Copyright Act attempted to solve the problem of rapid technological advancement by making copyright "technologically neutral". "Copyright protection subsists" it explains "in original works of authorship fixed in any tangible medium of expression, not known or later developed, from which they can be perceived, reproduced or otherwise communicated, either directly or with the aid of machine, or device."
Amendment to Intellectual Property law may also be appropriate in solving some specific problems posed by technology. For example, a common theme in the US Patent and Trademark Hearings on Patent Protection for Software-Related Inventions last February, was the need to reduce the protection period mandated by Intellectual Property legislation. Jim Warren of Autodesk argues for example, that 17 year software patents are unreasonable in an industry where significant innovation can be created in months, where most innovation has minimal cost, where manufacturing and distribution are trivial, and where the life of products may be only a few years.
However, as we saw in the previous sections, in total, the problems of information technology are not problems of degree but problems of kind. Accommodation by amendment can only be a temporary solution because it fails to resolve fundamental problems created by new technologies and new methods of creation. Since the problems lie at the conceptual core of Intellectual Property policy, amendment is only a band-aid approach to the problem.
However, such a band-aid approach may be appropriate in the transition between the Industrial and Information Eras. If there is a moral for us in the story of the Statute of Anne, it is that we cannot simply switch policy tools without affecting major social upheaval. In forming policy we must both accept the needs of the present and future as well as respect the needs of the past. Specifically, we can use, policy decisions to make the transition easier. In providing short term relief, there are at least three possible directions Congress could take.
Firstly, if Intellectual Property is once again considered policy rather than natural right, the government could more easily protect some ideas and not others. For example, because the effects of information technology vary, there are some industrial sectors which need the Intellectual Property protection. For these industries, the traditional Intellectual Property system works just fine. For example, small biotech companies which need large sums of capital for development and testing, rely on the patent system to raise money to be reinvested.
Hence, a transition commission to determine which industries need what incentives might be appropriate. Such a transition commission is suggested by the OTA and could assume 1) rule making and determination of rates such as compulsory license fees, 2) administration of sui generis protection schemes that fall between copyright and patent protection, 3) collection and analysis of information on markets and damages, solicitation and analysis of industry viewpoints, and solicitation and analysis of the public's views of their access to information goods and services, 4) policy planning and research on technological developments and their effects on the intellectual property system, and 5) advice to Congress on developments in intellectual property and suggest legislation as needed.
Secondly, the present marketplace needs time and stimulus to retool. For example, though traditional publishing companies are waning in usefulness, they represent a huge interest group which as in the days of the Statute of Anne, has the power to drag everyone down with it. Like the defense industry in the post-Cold War world, we must find a place for publishing companies and other institutions like them in the future. In helping the market retool, we must consider the new needs of the Information Era and how those industries could meet those needs. One possibility might be for publishing companies to become facilitating groups rather than distributing groups using their own ideas, skills, infrastructure, organization, connections, and networks to bring artists together and help in efficient, cost sharing marketing and distribution. The government's role in facilitating market transformation might involve tax incentives or other changes in industrial policy like antitrust legislation.
Finally, in periods of transition, we can assume strain on the system for the artists and public as well. During periods of strain, the government has a role in relieving hardship. Specifically, in times of market failure, the government can step in. Such involvement might come in the form of greater support of the arts and creative process through grants and support programs.
However, Congress should realize that short term amendment approaches are only transitional. Though Congress may act now to ease the burden of transition, it must be prepared to reconsider these actions within the next decade as information technologies continue to advance and expand the distance between society and Intellectual Property policy.
Future Alternatives to Intellectual Property.
In the long term, we must look to a new information paradigm. However, because the boundaries of the new era are still hazy, we should take our time and decide between policy options carefully. To do so, we should first identify all the important components of the policy environment and then develop policy with them in mind.
- In the dissemination of ideas we can identify two primary groups; Information policy must carefully balance the needs of both the public and the creators in order to achieve maximum efficiency.
- We can also identify three goals of Information policy; Firstly, policy must seek to advance the public good through the support of its artists and inventors. Secondly, policy must respect its context by balancing the needs of the public, the creators, with their environment. Finally, creator's incentives, be they monetary or social, must be legitimate, dependable and enforceable.
- Finally, there are two givens of the new policy environment; The Information Era is defined both by its fluidity and interactivity and the fact that performance rather than product determines value.
Given these environmental components, Congress might adopt a minimal approach to Intellectual Property law. That is, the government could back as far away from Intellectual Property law as possible by revoking the right of idea ownership. Instead, Congress could spend its energy affecting policy, absolutely necessary for the continued creation of works.
This approach is particularly well suited for a fast changing technological environment in which the basis for rewards are based on performance, rapid product cycles, and market share rather than unenforceable legal protection of tangible products. Information would remain as mobile as possible and policy could adapt more readily than law to changes. Instead of fighting an uphill, and ultimately futile battle against an evolving environment, the government could use policy to stimulate creation and protect against market failure.
For one, Congress could substitute other policy tools in place of Intellectual Property rights like economic incentives, subsidies or tax exemptions. The ending of copyright and patent filing and litigation alone would have the added bonus of lessening the monetary burden, especially on the small entrepreneurial businesses.
However, there are important drawbacks of the minimal system which must be understood and addressed. First and foremost, there is the problem with political feasibility.
However, by phasing in policy over the transitional period, and by helping vested interests to retool, political feasibility could be greatly enhanced. Further, the government should begin its own "philosophical advertising campaign" much like what the private sector does now in order to promote mature use of modern technologies.
Secondly, the minimal approach would entail risks to authorship and publishing as we know it. However, we must understand that authorship as we know it is evolving. In the Information Era, it is not who first came up with an idea, as it is what has been done with the idea since then. Performance, not product, is the paradigm of the Information Era. Information Era artists' incentives stem not so much from the transition of ideas into products as much as being able to add value to existing products. It is not what you can "make" but what you can "do".
The fear that there will be no basis for rewards in the Information Era is based on the misconception that data is the same as information. "Data" is not information. Information is a process. Artists will get paid for what they can do with their data. Such payment includes both monetary compensation and other rewards like a heightened reputation making their services more valuable and desired in the marketplace. John Perry Barlow notes, "In aesthetic information, whether poetry or rock n roll, people are willing to buy the new product of an artist, sight unseen, based on their having been delivered a pleasurable experience by previous work."
Yet evolution does not necessitate stability. Given the increased value of performance, Congress could refocus its energies towards other policies supportive of the new environment. For instance, Congress should investigate ways in which trade mark law could be enhanced so as to more effectively protect one's name because one's name, or one's reputation, is what performance seeks to enhance and is the true basis for rewards in the Information Era. Similarly, just as the present market and government has waged a morality battle against the unauthorized copy of protected works, the government should campaign against plagiarism in the Information Era.
Finally, we must take care to facilitate new methods of collaborative creation. Such incentives could firstly take the form of tax breaks or other economic incentives. Perhaps such economic incentives could support "facilitating companies (the old publishers) who would provide infrastructure, organization, contacts and networks. Secondly, the government has the responsibility to provide an "Open Platform" through which all members of the society can internetwork and most efficiently enhance the creative potential of the society. In building the information infrastructure, we must take care to not to discriminate, and to make sure that all people have equal access to the new resources. Finally, because the government is not the sole supporter of creativity in our society, it should provide incentive for private patronage and private investment in the creation and dissemination of ideas. Such aid could be in the form of tax incentives for private contributors or matching grants for private groups.
POLICY RECOMMENDATIONSThe Information Era represents novel change. Congress should structure policy to facilitate the public interest in ways responsive to these changes. Based on this study, I recommend that the Congress adopt these short term "relief" policies;
--- create a commission to deal with short term transition problems. +oprovide oincentive^^for anachronistic market iagents (like +publishing o(companies) @to 3oretool.
--- o&Increase government support of the arts and sciences through greater investments of public funds. I further recommend that the Congress adopts the following long term policies;
--- Dispense with traditional Intellectual Property policy.
--- Support performance oriented policy and law.
--- Increase support for artists and facilitate the emerging collaborative creative process.
BIBLIOGRAPHYIn this analysis I draw heavily upon the following works. I fully recommend that anyone interested in this issue supplement this study with these groundbreaking works.
1. US Congress, Office of Technological Assessment "Intellectual property Rights in an Age of Electronics and Information" OTA-CIT-302 (Washington DC: US Government Printing Office, April 1986)
2. Barlow, John Perry "Selling Wine Without Bottles", EFF ftp Archive ftp:// pub/eff/policy/intellectual_property/economy_of_ideas
3. Priest, Curtiss "The Character of Information", EFF ftp Archive ftp:// pub/eff/policy/intellectual_property/priest.txt
Other sources for this analysis include the following:
1. Marke, Julius J "Copyright and Intellectual Property" Georgian Press Inc. 1967
2. Hearing before the Subcommittee on Courts, Intellectual Property, and the Administration of Justice "Intellectual Property, domestic Productivity and Trade" July 25, 1989
3. Hearing before the Subcommittee on International Trade of the Senate Committee on Finance "Intellectual Property Rights
4. Arup, Christopher "Innovation, Policy and Law" Cambridge University Press 1993
5. Aharonian, Gregory Patent and Copyright gopher and listserv firstname.lastname@example.org gopher site
6. Leaffer, Marshall "International Treaties and Intellectual Property" Bureau of National Affairs Inc. 1990
7. Womack, James "The Machine that Changed the World" Harper Perrenial 1990
8. USPTO Transcripts of the Public Hearing on Use of the Patent System to protect Software-related Inventions
9. Negativeland "Fair Use" Available on the Internet as public domain ASCII text
10. Scarles, Christopher "Copyright" Cambridge University Press 1980
11. Bugbee, Bruce "Genesis of the American Patent and Copyright Law" Washington DC Public Affairs Press 1967
12. Heim, Michael "The Metaphysics of Virtual Reality" Oxford University Press 1993