Copyright and Confirmation Bias
An old (2005) post about Napster was recently brought to my attention. In it, Don Dodge, a former VP of product development at Napster maps out what happened to the company, how they pleaded with the music industry to provide a better solution to them (which was more or less reinvented/reimplemented many years later by iTunes) and how the music industry had put itself in such a position as to be literally unable to act in its own best interests, or the interests of its artists. Dodge estimates, based on internal Napster research, that Napster could have generated $3 billion per year for the industry, with minimal overhead.
I talk to people at copyright conferences and they will make some observation such as copyright has managed to support specific identified individuals and therefore it’s a good thing (most recently it was specific teachers whose retirement was funded by their textbook sales). However, to rely on this sort of evidence in policy making is basic bad practice. It seeks out only the evidence which supports the proposition, when it should be critically analysing it. A proper analysis would look at how many people paid more than they ought to have for a book, and whether some people went without because the cost was too high. Moreover, it would look at the also-rans who devoted much time to writing a textbook only to have it fail in the market. It would look at the books which were substandard and were not improved because of copyright restrictions. For every success there are orders of magnitude more failures. Proper policy would be more circumspect in trying to entice, through the incentive of copyright, the unwary into the market.
Copyright costs the community. That cost is never factored into any copyright policy – at least, so far as I have been able to tell. Most recently, the prohibition on parallel importing of books is an obvious example. The Productivity Commission put out a report which set out, in bare, incontrovertible terms, the damage that this particular aspect of copyright does to the community. After a long period of merciless lobbying the proposals to remove the anti-consumer restrictions on parallel importing have been defeated (ironically, the report was criticised for being considered analysis, it was even expanded to cover some of the criticisms of it).
Copyright, and IP policy in general seems to exist in a twilight zone in which reality is not permitted to reach. Copyright holders have express exemptions to the Trade Practices Act that property owners can only dream of. They are funded by the government to lobby for more copyright and then, of course, use their monopoly profits to lobby for more funding. They are allowed to sing the benefits while policy makers fail to even seek out evidence of the costs. Despite the concept of natural rights of copyright being expressly repudiated by parliament and judiciary they are allowed to persist in their rhetoric of rights. Despite the copyright monopoly having little in common with property, they continue to talk as if it does.
In the case of Napster, the copyright monopoly seems to have delayed the innovation we now call iTunes by a good part of a decade, and diddled musicians out of billions of dollars in the process, but copyright ideologues will not hear of it.
[Update: Professor Alan Fels (the former head of the Competition and Consumer Commission) is quoted as being critical of the parallel import decision:
Professor Fels said the decision to explicitly reject a recommendation of the Productivity Commission meant that ”every time one of our more than 10 million book readers visit a bookshop and pay more for books, the Government will be and should be held responsible”.
