Sat, 19 Nov 2005

Overstating the Legal Problem, Missing the Real Problem

Lawyers see online distribution as a legal problem: there is a base assumption that people are thieves only restrained by the law. This means that "copyright is doomed" and radical change is required for "the digital age". The two economists who spoke on the second day of the Copyright Symposium seemed to find this legal-centered thinking baffling, as do I.

Given the number of my friends who collect DVDs rather than renting them, I believe people really like owning stuff. There is clearly a premium they will pay to own something. This is one reason why legitimate online provision of content can be successful when attempted. Yet when the industry does provide, they place unnatural limits on content which weaken the ownership of the purchaser, undermining their key advantage. Lack of resalability is the least of these: in a practical sense, you have more ownership of an illegally-downloaded MP3 (which you can put on your iPod) than the same song purchased from Telstra's music service. Add in the lack of competition between online outlets, overpricing and dismal range (which should have been another great strength of online distribution), and the pattern seems clear to me. More stick is poor replacement for carrots.

The industry has failed to provide for over seven years now. The longer this goes on, the more customers learn that all legitimate offerings suck, and the only real way to enjoy content is to get it from unauthorized sources. From a policy point of view, copyright holders are not holding up their end of the copyright bargain, and it's damaging us all.

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