Intellectual Property

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Citation

It is remarkable that economists, who usually view themselves as advocates of free market transactions, unquestioningly embrace various forms of intellectual property rights, especially copyrights and patents. Copyrights and patents are government granted monopolies. They have their origins in the feudal guild system, not the free market economics of Smith and Ricardo. In fact, at the end of the 19th century, Switzerland and the Netherlands actually eliminated patent and copyright protection, with the intent of promoting free market competition. In spite of their feudal legacy, and their obvious status as forms of protectionism, few economists ever question the merits of the patent and copyright systems.

- Dean Baker [1]

Definition

1.

"Broadly speaking, Intellectual Property Rights (IPR) are a set of legal rules used for regulating the use of "creative work". Intellectual property is divided into two categories: Industrial property, which includes inventions (protected by patents) and Copyright, which in general terms covers literary and artistic works.

Whereas copyright laws are designed to protect the expression of the content, patents protect the content itself and grant a monopoly over its use." (http://www.choike.org/nuevo_eng/informes/4517.html)

2.

"“ideas, inventions, discoveries, symbols, images, expressive works (verbal, visual, musical, theatrical), or in short any potentially valuable human product (broadly, “information”) that has an existence separable from a unique physical embodiment, whether or not the product has actually been “propertized,” that is, brought under a legal regime of property rights.” (http://cyberlaw.stanford.edu/system/files/From+Wifi+to+Wikis+and+Open+Source.pdf)

- WILLIAM M. LANDES & RICHARD A. POSNER, THE ECONOMIC STRUCTURE OF INTELLECTUAL PROPERTY LAW 1 (2003).

The issue explained


Why we should not use the concept

1. Simon Phipps:

"The term is used widely in the business and legal communities, and it becomes second nature to speak of patents, copyright, trademarks and trade secrets collectively in this way. The problem with doing so is that the expression is factually wrong, and a legion of open source developers (you know, the ones working on free software) take the use of the phrase "intellectual property" as a genetic marker for "clueless PHB-type" at best and "evil oppressor of geeks" at worst.

Why is it wrong? Well, none of those things is really "property". In particular, copyright and patents are temporary privileges granted to creative people to encourage them to make their work openly available to society. The "social contract" behind them is "we'll grant you a temporary monopoly on your work so you can profit from it; in return you'll turn it over to the commons at the end of a reasonable period so our know-how and culture can grow."

Using the term "intellectual property" is definitely a problem. It encourages a mindset that treats these temporary privileges as an absolute right. This leads to two harmful behaviours:

  • First, people get addicted to them as "property". They build business models that forget the privilege is temporary. They then press for longer and longer terms for the privilege without agreeing in return to any benefit for the commons and society.
  • Second, they forget that one day they'll need to turn the material over to the commons. Software patents in particular contain little, if anything, that will be of value to the commons - no code, no algorithms, really just a list of ways to detect infringement."

(http://blogs.sun.com/webmink/entry/intellectual_privilege)


2. Cory Doctorow


In the Guardian, Cory Doctorow explains why the concept of IP, tied to property, is so inadequate:

Copyright - with all its quirks, exceptions and carve outs - was, for centuries, a legal regime that attempted to address the unique characteristics of knowledge, rather than pretending to be just another set of rules for the governance of property. The legacy of 40 years of “property talk” is an endless war between intractable positions of ownership, theft and fair dealing. If we’re going to achieve a lasting peace in the knowledge wars, it’s time to set property aside, time to start recognising that knowledge - valuable, precious, expensive knowledge - isn’t owned. Can’t be owned. The state should regulate our relative interests in the ephemeral realm of thought, but that regulation must be about knowledge, not a clumsy remake of the property system.


...


“Intellectual property” is one of those ideologically loaded terms that can cause an argument just by being uttered. The term wasn’t in widespread use until the 1960s, when it was adopted by the World Intellectual Property Organization, a trade body that later attained exalted status as a UN agency.

WIPO’s case for using the term is easy to understand: people who’ve “had their property stolen” are a lot more sympathetic in the public imagination than “industrial entities who’ve had the contours of their regulatory monopolies violated”, the latter being the more common way of talking about infringement until the ascendancy of “intellectual property” as a term of art.

Does it matter what we call it? Property, after all, is a useful, well-understood concept in law and custom, the kind of thing that a punter can get his head around without too much thinking.

That’s entirely true - and it’s exactly why the phrase “intellectual property” is, at root, a dangerous euphemism that leads us to all sorts of faulty reasoning about knowledge. Faulty ideas about knowledge are troublesome at the best of times, but they’re deadly to any country trying to make a transition to a “knowledge economy”.

Fundamentally, the stuff we call “intellectual property” is just knowledge - ideas, words, tunes, blueprints, identifiers, secrets, databases. This stuff is similar to property in some ways: it can be valuable, and sometimes you need to invest a lot of money and labour into its development to realise that value.

But it is also dissimilar from property in equally important ways. Most of all, it is not inherently “exclusive”. If you trespass on my flat, I can throw you out (exclude you from my home). If you steal my car, I can take it back (exclude you from my car). But once you know my song, once you read my book, once you see my movie, it leaves my control. Short of a round of electroconvulsive therapy, I can’t get you to un-know the sentences you’ve just read here.

It’s this disconnect that makes the “property” in intellectual property so troublesome. If everyone who came over to my flat physically took a piece of it away with them, it’d drive me bonkers. I’d spend all my time worrying about who crossed the threshold, I’d make them sign all kinds of invasive agreements before they got to use the loo, and so on. And as anyone who has bought a DVD and been forced to sit through an insulting, cack-handed “You wouldn’t steal a car” short film knows, this is exactly the kind of behaviour that property talk inspires when it comes to knowledge.

But there’s plenty of stuff out there that’s valuable even though it’s not property. For example, my daughter was born on February 3, 2008. She’s not my property. But she’s worth quite a lot to me. If you took her from me, the crime wouldn’t be “theft”. If you injured her, it wouldn’t be “trespass to chattels”. We have an entire vocabulary and set of legal concepts to deal with the value that a human life embodies.

What’s more, even though she’s not my property, I still have a legally recognised interest in my daughter. She’s “mine” in some meaningful sense, but she also falls under the purview of many other entities - the governments of the UK and Canada, the NHS, child protection services, even her extended family - they can all lay a claim to some interest in the disposition, treatment and future of my daughter.

Trying to shoehorn knowledge into the “property” metaphor leaves us without the flexibility and nuance that a true knowledge rights regime would have. For example, facts are not copyrightable, so no one can be said to “own” your address, National Insurance Number or the PIN for your ATM card. Nevertheless, these are all things that you have a strong interest in, and that interest can and should be protected by law.

There are plenty of creations and facts that fall outside the scope of copyright, trademark, patent and the other rights that make up the hydra of Intellectual Property, from recipes to phone books to “illegal art” like musical mashups. These works are not property - and shouldn’t be treated as such - but for every one of them, there’s an entire ecosystem of people with a legitimate interest in them.” (http://www.guardian.co.uk/technology/2008/feb/21/intellectual.property)

All the citations are from Benjamin Mako Hill at http://mako.cc/talks/20060428-information_freedom/information_freedom-talk_notes.html


Forms of Intellectual Property

"Private property in ideas comes in variety of ways. Most notable amount these are intellectual property:


  • Copyright: Long-term (i.e., up to 100+ years) monopolies in a particular type of expression.
  • Patents: Medium-term (i.e., 20 years) monopolies on an idea.
  • Trademarks: Unlimited or "as need be" monopolies on marks used to keep consumers from being confused.

Each of these gets special and particular legal protection." (http://mako.cc/talks/20060428-information_freedom/information_freedom-talk_notes.html)

The Second Enclosures or the extension of IP in recent decades

"Each of these areas is expanding in scope and duration:


  • Copyright lasts decades longer.
  • Business methods and software is now patentable.
  • DRM systems make it so that your technology no longer respects your wishes when those clash with the wishes of the people who created your computer or the content that you have put onto it.


In an unprecedented development, this protection has been merged with global trade (e.g., agreement to IP in the TRIPS agreement is part of joining the WTO)." (http://mako.cc/talks/20060428-information_freedom/information_freedom-talk_notes.html)


"Each of these areas is expanding in scope and duration:


  • Copyright lasts decades longer.
  • Business methods and software is now patentable.
  • DRM systems make it so that your technology no longer respects your wishes when those clash with the wishes of the people who created your computer or the content that you have put onto it.


In an unprecedented development, this protection has been merged with global trade (e.g., agreement to IP in the TRIPS agreement is part of joining the WTO)." (http://mako.cc/talks/20060428-information_freedom/information_freedom-talk_notes.html)


Proposed solutions and IP-related movements

"There are three major classes of methods by which people "resist" current ownership of ideas:


1. Alternative Approaches: Groups to attempt to live the world now by creating and releasing information freely and by refusing to participate, either through production or consumption, in proprietary communities. They define essential freedom and then live in that world.


Examples

  • The free and open source software movement. If you're heard of GNU/Linux, then you know what I'm talking about.
  • The Science Commons project or Open Access journal movement.
  • Arguably, some aspects or sub-groups within the Creative Commons movement.


2. Transgressive Approaches: Frequently, this boils down to piracy. In addition to systems like Napster, this is the process through which the vast majority of the world produces and consumes content. In a sense, what is happening is that the group simply ignores the current exclusionary approaches to IP. Some argue that this will kick the legs out from under the current system in the process.


Examples


  • The way that media is consumed in the vast majority of the world.
  • Napster and most up-to-date P2P technology. Getting involved is as simple as participating.
  • Groups like the Pirate Bay which is run by a group in Sweden called Pirat Byran which now has a political party.


3. Progressive Approaches: These are primarily approaches that involve "working within the system" in one way or another. This can include anything from consumer campaigns to put pressure on recording companies to constitutional challenges to copyright extensions in front of the Supreme Court.


Examples


  • Creative commons through creating licensing.
  • The work of groups like the Electronic Frontier Foundation (EFF), Public Knowledge, and others who are working to put checks on the expansion of IP law and the "enclosure" of the public domain."

(http://mako.cc/talks/20060428-information_freedom/information_freedom-talk_notes.html)

The Arguments in the Debate

For a shorter summary of the critique, see this article by Geshan Manandhar, Problems with Intellectual Property

Justification of Property in Immaterial Goods

"Why have property? Property feels right to many of us because of a sense that each of us should own the fruit of our labor. But this is at least not the whole story, because some property - such as land - wasn't created by its owners. Say there's a large stretch of land that's commonly owned, such as the West of the U.S. once was. The government decided to open the land for private ownership. It didn't have to do it; it could have kept it as a giant park, and no-one's property rights would have been harmed. But it gave or sold the land to people who didn't create it, thus limiting the freedom of action of all others. The reason for this was incentive: If people have the right to exclude others from their land, they'll have more incentive to invest effort in improving the land - build homes, plant crops, and so on...So far, the argument tracks copyright and patent law quite well. The theory of intellectual property is likewise that giving people the right to exclude others from new works or inventions will give people an incentive to invest effort in creating and inventing." (Eugene Volokh - Cited by David Levine [2])


The Radical Critique of Copyright as Inappropriate for Immaterial Goods

The following is the critique by the Piratbyran Grey Common advocates of the free usage of digital culture products, as the most easy and logical way to use the new technologies.

They argue that copyright, a legal solution for write-only print technologies is radically inappropriate for the read/write possibilities of the computer, and that the ideology and framework of copyright (see Mental Rights Management ), and its struggle to restrain P2P Filesharing should be opposed.

All excerpts here are from Rasmus Fleischer at http://copyriot.blogspot.com/2006/06/piratbyrans-speech-at-reboot.html


History of Copyright

Rasmus Fleischer:

"It is essential for the copyright industry to keep the majority of computer users trapped in the belief that the "window" of their web browser is exactly a window, through which they can look at information located elsewhere, under someone else’s control. Then our job is to clarify that everything you see on your screen or hear through your speakers, is already under your control. Zeros and ones have no taste, smell or color – be they parts of pirated material or not. Therefore it is impossible to construct a computer that cannot reproduce and manipulate these zeros and ones – as such a machine would no longer be a computer, but something as grotesque as a digital simulation of the machines of the last century.


From one-way to read/write

But of course the aim of copyright is to do exactly that. Copyright was born in 18th century England in order to regulate the use of one specific machine, a machine that was expensive, few in numbers and that could write but not read, namely the printing press. Ever since, copyright laws have tried with varying success to make other machines imitate the characteristics of that one-way medium. The concept was pretty easily adapted to the first technologies of sound and image recording, as grammophone and film entered around the turn of the last century, both being one-way media. But in the seventies, machines that could both read and write, like the Xerox photocopier, the audiocassette and video recorders, came into the hands of a wider population. This transformed the production of culture, as well as the distribution. Remix, cut-up and mash-up cultures flourished, with early adopters like William S. Burroughs. The record industry started to claim that home taping was killing music. Initially, they wanted to stop the cassette technology altogether. However, the common compromise solution in Western Europe gave the introduction of a special tax on magnetic tapes, in order to "compensate" the copyright holders for a calculated loss of sales. Since that time, the sampler, the CD-burner and portable memory devices has continued to make the possibilities greater. Now we’ve got the combination of home computers, broadband, network protocols and compression algorithms that together define what we know as P2P file sharing. As we stand here today a fair question must be if a principle that was implemented for controlling printing presses in 18th century England should be the hole which our present world must circulate through.


The threefold division: A parenthesis in musical history

In the beginning, copyright was simply a regulation of the reproduction of printed matter. Anything that was not made with printing presses, was not really under copyright's domains. Sound was something essentialy fleeting and intangible, something that happened in real time. In particular cases, musical notation was used, but primarily as a simple memory-helper for musicians. The Western classical tradition, however, evolved on its on way, more and more dividing the role of the composer from the role of the performer, by making notation more and more exact. But music and musical performances had nothing to do with copyright. Only the printed graphical representations of music was affected.

But things changed with the new reproduction technologies for sound and film, some time roughly around year 1900. Legislation transformed as a response to the possibility to reproduce sounds and not only symbolic representations of sound. Copyright went from covering texts to covering Works. A Work can be defined as the abstract product of any artistic creation, existing independently of its material forms. Now, composers not only owned the symbolic representation of music in form of a musical score on a printed paper, but also the melodies themselves. The realm of copyright conquered two new territories: public performances and recorded music. But it was still based in the concept on written music. The symbolic score secured its power over the real vibrations stored in records, as well as over the live music experience. That meant that a lot collecting societies had to be funded, responsible for channeling money to composers and publishers, who still were the only musical copyright holders. Radio broadcasting meant a growing cake, and soon some musical performers and record companies demanded their share from it too. And they got it in the early 1960s, when the Rome Treaty gave international copyright two new layers: performer's rights and producer's rights. Music copyright, and the whole phonogram economy, is still built on this threefold division between the composer, the performer, and the producer. Those are the three main roles, each one represented by a different collecting society, each getting their own share of money for every song played on the radio and every CD-R sold. But since this system was institutionalised, the division itself has shown clear signs of dissolution, and in quite many cases, one can observe how all those three roles are converging into the figure of the bedroom producer. A convergence driven by the development of recording and mixing technology, from the multitrack tape recorders of the 1960s, to the contemporary average computer able to simulate what only some years ago demanded very expensive studio time. But lowered production costs wasn't saluted by everyone.


Mechanical music menace

At first, synthesizers were marketed as a substitute for living musicians. Advertisements presented the Roland MC-8 Microcomposer as a huge orchestra. No wonder that the musicians' trade unions, all over the world, depicted electronic instruments as a threat. They preserved the traumatic memories of when the introduction of talking films created mass unemplyment amongst cinema musicians, and held a strong belief that technical reproduction of music was a threatening rival to live performances. During the early eighties, the American Federation of Musicians fought against use of synthesizers to mimic string and wind instruments, in the name of employment. One idea, seriously considerated in several countries, was to impose a special fee on synthesizers, to make them less attractive and to support orchestras with "real" instruments. The London chapter of the British musicians' union went one step further, demanding a complete ban on synthesizers – which caused a split in the union, where musicians affirming electronics started their own Union of Sound Synthesists (USS). Both electronic musicians and DJ:s were being labelled as sell-outs who played the game of commercial interests. The unionist resistance against the synthesizer, was rooted in ideas about how capitalists tries to lower production costs, just for their own profit. The basis for that argument, was the hegemony of a very narrow definition of a musical performer: Only people mechanically controlling the production of sound in an instrument, like a violin or a saxophone. But that narrow view was soon to be undermined by a number of experiments in hacking and indeterminacy, that explored the sonic machines as something else than just representational technologies. DJ:s hacked the turntable, transforming it into an instrument of musical production, and the discjockey became a cathegory of creators not fitting in any of the roles in the tripartite division of composers, musicians and producers. The Roland TB-303 was designed to reproduce the sound of a bass-guitar, but was hard to configure and made interesting mistakes. Soon the misuse became the norm, as the unique squelching sounds produced by its filters came to define a whole genre of music – acid house.


Music is, as it were, performance

When making electronic music, the bedroom producer is programming patterns that are interpreted not by musicians but by machines, and then mixing the components together. But the bedroom producer is not really a composer and not a producer – but truly a performer. In contrast to the institutionalised image of the musician interpreting the symbolic notes of a composer's score, the bedroom producer interprets not symbols but real sound samples and the imaginary musical styles. Recombining, refining. Redefining bugs to features. Performing a beat, that in real time is performed again by the dancing crowd, interpreting sounds into bodily movements. Or maybe recorded, encoded as MP3, copied though Soulseek, and psychogeographically performed by playlist fanatics. Music is, as it were, performance. Even the uses of recorded sound must today be understood as real-time experiences – if we are not to be stuck in a dead-end road like the musician's unions fighting the synthesizer.

Similar tendencies – with selection and recombination as an ever more important creative role – can be seen everywhere on the artistic fields. Without openly confronting copyright law at all, these practices subtly marks out a line of flight. Along that line, creativity and artistic interpretation migrates out from the realm of copyright, leaving its gateways to the realm of semantics wide open and leaking." (http://copyriot.blogspot.com/2006/06/piratbyrans-speech-at-reboot.html)


Filesharers are not consumers

Rasmus Fleischer:


"Beyond the consumer/producer-dichotomy The copyright industry today likes to present the problem as if internet were just a way for so-called “consumers to get so-called content, and that we now just got to have "a reasonable distribution" of money between ISP:s and content industry. But we must never fall in that trap, and we can avoid it by refusing to talk about “content" altogether. Instead, we talk about internet as communication. Therefore, it is totally wrong to regard our role as to represent “consumer interests". On the contrary, it’s all about escaping the forceful division of humanity into the two groups "producers" and "consumers" that copyrights produces in different ways. An obvious example is the movie industry’s bizarre lobbying to “plug the analog hole", by introducing a law banning video equipment able to rip analog media. The law proposal put forward by the MPAA mentions that so-called professional producers of course should have a license to use these video cards anyway. The effect would of course be an extreme consolidation of the split between producers and users." (http://copyriot.blogspot.com/2006/06/piratbyrans-speech-at-reboot.html)


Against Alternative Compensation Systems

Rasmus Fleischer:

"But so-called "alternative compensation systems", that some voices put forward as a progressive alternative to DRM and mass-criminalization, they are no less reproducing this split. The idea is usually to impose a special fee on every internet connection, so that a bureaucracy could channel the money to publishers and other rights holders. This way we can save both the copyright system and file sharing, says amongst others Lawrence Lessig, the EFF, and the Swedish Green party. However, none of them likes to specify exactly how it should be decided which creators that should get money. If book authors should get compensation when their books are digitally transmitted, why should not bloggers get a part of this compensation as well? So, for the very notion of "compensation" to work, there must be someone filtering out the "worthy" forms of artistic creation from "unworthy". (Or the system could give every internet user money for every line they are writing in a chat, but that would maybe better be called an universal basic income.) This dilemma also illustrates the schizophrenic nature of industry. Companies like Microsoft and Sony on one hand tries to use DRM to block out independent cultural production. But on the other, they are already totally dependent of what they call “user-generated content".

Clever entrepreneurs of course do understand that internet business is not about selling information. It is about selling the possibility to interact. Overcoming the split between producers and consumers is not some utopia of a world to come, but a necessity to let communication media be communication media instead of simulating one-way media." (http://copyriot.blogspot.com/2006/06/piratbyrans-speech-at-reboot.html)



Summary of Copyright's Three Points of Crisis

Rasmus Fleischer:

"Copyright's three points of crisis I have mentioned two key points in copyrights' permanent crisis, points where concepts that where evolved to handle the separated flows of one-way mass-media clashes with the reality of networked computers. One was the fact that the very concept of copying is rather arbitrary when it comes to digital technology, as using digital information already implicates that it is copied. Another was the extreme problems with institutionalizing a producer/consumer-division, inside a media technology used for horizontal communication. Both anomalies seems totally unsolvable, from the perspective of copyright, and indicates that the copyfight is very unlikely to cool down. Now I will go on to the third point of crisis: the form/content dichotomy.


Three key points in copyright’s permanented crisis


  • RAM/ROM; the very definition of "copying" is arbitrary
  • Consumer/producer; impossible to institutionalize, especially in communication media.
  • Form/content; the distinction can only pass a digital cable as simulation


The form/content-division belongs in the age of postal distribution

Year 1793, Johan Gottlieb Fichte wrote a piece that for the first time clearly separated "form" and "content", with the specific and successfull goal of establishing literary copyright. While an author's ideas are the universal content of writing, he gives them an unique individual form, which is his intellectual property. Then, on another level, the copyrighted material itself usually is described as content, then understood as abstracted artefacts, not bound to a specific media form.

Communication media are, on a kind of third level, also logically divided between form and content; or, more specific, in address and message, or instruction and information. That division could seem totally unproblematic at Fichte's times around year 1800, at the dawn of modern copyright and a couple of centuries after the postal system got public. The postal system has always built upon the physical separation between the address outside the envelope, and the message inside it, the latter hidden and legally protected.

Already with telephony, however, this separation wall started to leak. The "hole" between form and content was signified by the frequency of 2600 Hz, used by phreakers to insert information that the central servers interpreted as instructions to connect calls for free. But, as the servers were still centralised, this tiny hole never grew to be a huge gap in the wall.

Networked computers, however, are not only media, but universal semiotic machines. Computers makes no difference between information and instruction, they're storing text and code in just the same way: Form and content cannot be distinguished objectively.

But that distinction is what European politicians today are trying to resurrect, in the implementation of the data retention directive. What they say and probably believe, is that data retention has nothing to do with supervising what people say to each other on the net – it's not about the content, only about who is communicating with who. And that is maybe possible if this is restricted to e-mail communication using the SMTP protocol. But what for, if every criminal knows that they can just communicate in chatrooms or with community messages? Either politicians must give up their stated ambition, or they are bound to go into ever more detailed regulation of specific internet protocols. But Sweden's judiciary minister thomas Bodström, that has been spearheading the European plans for data retention, still talks about supervising only the address layer and not the content layer.

The important point, in criticising data retention and similar surveillance measures, is not about so called "privacy" or "personal integrity". We would like to stress the importance of different media logics. The distinguishing of form and content is a physical part of an postal letter, but it cannot pass a data cable. The only way for it to pass, is as a simulation. And every single regulation that is based on such a simulation, will inevitabely kill one thousand other possible simulations. It will block the exploring of one thousand paths.

Instead of assuming the holiness of privacy, we are questioning the technological consequences of data retention, in terms of detailled regulation of communication protocols, and the ban on anonymous internet connections. The main problem with surveillance and with the war against filesharing, is maybe not about an unfair trespassing on what should belong to the individual subject – it is about an unfair and absurd attempt to turn networked computers into individual subjects." (http://copyriot.blogspot.com/2006/06/piratbyrans-speech-at-reboot.html)


Intellectual Property is a unjustifiable Intellectual Monopoly - David Levine

"Intellectual property law is not about your right to control your copy of your idea - this is a right that we have just pointed out, does not need a great deal of protection. What intellectual property law is really about is about your right to control my copy of your idea. This is not a right ordinarily or automatically granted to the owners of other types of property. If I produce a cup of coffee, I have the right to choose whether or not to sell it to you or drink it myself. But my property right is not an automatic right both to sell you the cup of coffee and to tell you how to drink it.

It is important to distinguish between property rights and contractual agreements. You could sell me the delicious cup of coffee you just made, and have me sign a contract agreeing not to drink the coffee after 4 pm. But if I were to violate this agreement it would not be theft. As a matter of law, you could not send the police after me. You could sue me for breach of contract - and the courts might or might not decide the contract was valid. But there would be no question of theft or violation of property rights.

So what is the contractual arrangement in current intellectual property law? The most significant feature is the agreement not to sell copies of the idea in competition with the person who sold you the idea. Outside of the area of "intellectual property" such an agreement would be called anti-competitive, and a violation of the anti-trust law. If you reach an agreement with someone else not to compete with them, not only would the courts refuse to enforce such a contract, but you would be subject to substantial civil and criminal penalties. "Intellectual property" in other words, is not about property at all, it is about legal monopoly.

Some economists would argue that any contracts voluntarily entered into should be enforced. That is what lead them to argue that, if I agree not to redistribute your book, then I should be bound by that agreement. In this view, the copyright law simply codifies the contract that sellers of embodied ideas would wish to bind their buyers to, and so saves on private transaction costs. While this argument is substantially different, and more coherent, than the one equating intellectual monopoly with private property, it is equally faulty from an economic standpoint. In fact such intellectual property "contracts" create substantial and difficult transactional problems - and in our view this is one of the most important reasons for eliminating both copyright law and private contractual arrangements that limit the downstream rights of buyers of ideas. Let us see why.

The closest case is that of slavery. That is, the courts will not enforce a contract in which you sell yourself into slavery. In the case of slavery, as in the case of intellectual "property" we believe that the economic and moral arguments point in the same direction for the same reason. Your labor is irrevocably bound to your person. To enforce a contract in which you sell yourself to someone else requires them to enforce the contract by intrusive, expensive, and morally offensive measures. Hence we allow you to rent your labor, but not sell yourself. This is not only a "morally just" prohibition, as many economists have argued, it is also an economically efficient one.

Just as your labor is bound to your person, so is your knowledge of ideas, regardless of whether such knowledge may have been acquired directly or by learning from someone else. Once the ideas have been voluntarily transmitted to you, and the established market price paid, those ideas are bound to your person as much as your labor is. Preventing you from freely using such knowledge is logically equivalent to forcing your mind into slavery. Even in the case of objects you voluntarily purchased in the market at the asked price, such as books, CDs or computer files, these typically reside in your house, your office or some other space which belongs to you. They are your private property very much in the same way that the cup of coffee you are drinking is your private property. To enforce an intellectual monopoly restriction on the usage of those objects requires intrusive, expensive and morally offensive measures. It is no coincidence that intellectual property law is everywhere the enemy of privacy and freedom. Contrary to the rhetoric of those who advocate the current law, it is not theft to make copies of a book legally acquired. On the other hand, the measures used and proposed for preventing the owners of those books from making copies are akin to breaking and entering.

Intellectual property law is not about your right to control your copy of your idea - this is a right that we have just pointed out, does not need a great deal of protection. What intellectual property law is really about is about your right to control my copy of your idea. This is not a right ordinarily or automatically granted to the owners of other types of property. If I produce a cup of coffee, I have the right to choose whether or not to sell it to you or drink it myself. But my property right is not an automatic right both to sell you the cup of coffee and to tell you how to drink it.

It is important to distinguish between property rights and contractual agreements. You could sell me the delicious cup of coffee you just made, and have me sign a contract agreeing not to drink the coffee after 4 pm. But if I were to violate this agreement it would not be theft. As a matter of law, you could not send the police after me. You could sue me for breach of contract - and the courts might or might not decide the contract was valid. But there would be no question of theft or violation of property rights.

So what is the contractual arrangement in current intellectual property law? The most significant feature is the agreement not to sell copies of the idea in competition with the person who sold you the idea. Outside of the area of "intellectual property" such an agreement would be called anti-competitive, and a violation of the anti-trust law. If you reach an agreement with someone else not to compete with them, not only would the courts refuse to enforce such a contract, but you would be subject to substantial civil and criminal penalties. "Intellectual property" in other words, is not about property at all, it is about legal monopoly.

Some economists would argue that any contracts voluntarily entered into should be enforced. That is what lead them to argue that, if I agree not to redistribute your book, then I should be bound by that agreement. In this view, the copyright law simply codifies the contract that sellers of embodied ideas would wish to bind their buyers to, and so saves on private transaction costs. While this argument is substantially different, and more coherent, than the one equating intellectual monopoly with private property, it is equally faulty from an economic standpoint. In fact such intellectual property "contracts" create substantial and difficult transactional problems - and in our view this is one of the most important reasons for eliminating both copyright law and private contractual arrangements that limit the downstream rights of buyers of ideas. Let us see why.

The closest case is that of slavery. That is, the courts will not enforce a contract in which you sell yourself into slavery. In the case of slavery, as in the case of intellectual "property" we believe that the economic and moral arguments point in the same direction for the same reason. Your labor is irrevocably bound to your person. To enforce a contract in which you sell yourself to someone else requires them to enforce the contract by intrusive, expensive, and morally offensive measures. Hence we allow you to rent your labor, but not sell yourself. This is not only a "morally just" prohibition, as many economists have argued, it is also an economically efficient one.

Just as your labor is bound to your person, so is your knowledge of ideas, regardless of whether such knowledge may have been acquired directly or by learning from someone else. Once the ideas have been voluntarily transmitted to you, and the established market price paid, those ideas are bound to your person as much as your labor is. Preventing you from freely using such knowledge is logically equivalent to forcing your mind into slavery. Even in the case of objects you voluntarily purchased in the market at the asked price, such as books, CDs or computer files, these typically reside in your house, your office or some other space which belongs to you. They are your private property very much in the same way that the cup of coffee you are drinking is your private property. To enforce an intellectual monopoly restriction on the usage of those objects requires intrusive, expensive and morally offensive measures. It is no coincidence that intellectual property law is everywhere the enemy of privacy and freedom. Contrary to the rhetoric of those who advocate the current law, it is not theft to make copies of a book legally acquired. On the other hand, the measures used and proposed for preventing the owners of those books from making copies are akin to breaking and entering.

In "intellectual property" law, not only does the purchaser implicitly agree not to compete with the seller, but this agreement is binding on third parties. That is if the purchaser violates their agreement, and sells the their copy of your idea to me, I am still bound by the original agreement. If a purchaser violates their agreement using my network, I am liable for violating a contract I never agreed to in the first place. No sane person can look at the laws on intellectual property as they exist and are argued in court and reach any conclusion other than that on the face of it they are absurd." (http://levine.sscnet.ucla.edu/general/intellectual/coffee.htm)


Case Study of Why Patents are Counterproductive

From Chapter 1 of David Levine's Against Intellectual Monopoly:


"Once Watt’s patents were secured, a substantial portion of his energy was devoted to fending off rival inventors. In 1782, Watt secured an additional patent, made “necessary in consequence of ... having been so unfairly anticipated, by [Matthew] Wasborough in the crank motion." More dramatically, in the 1790s, when the superior and independently designed Hornblower engine was put into production, Boulton and Watt went after him with the full force of the legal system. In contrast to Watt, who died a rich man, the inventor Jonathan Hornblower was not only forced to close shop, but found himself ruined and in jail.

...The fuel efficiency of steam engines is not thought to have changed at all during the period of Watt’s patent; while between 1810 and 1835 it is estimated to have increased by a factor of five. After the expiration of Watt’s patents in 1800, not only was there an explosion in the production of engines, but steam power finally came into its own as the driving force of the industrial revolution. In the next 30 years steam engines were modified and improved, and such crucial innovations as the steam train, the steamboat and the steam jenny all came into wide usage. The key innovation was the high-pressure steam engine – development of which had been blocked by Watt by strategically using his 1775 patent." (Posted by Michele Boldrin at http://www.econ.umn.edu/~mboldrin/aim.html)

More Information

Articles

  1. Menell, Peter S. 2000. "Intellectual Property: General Theories", in

Encyclopedia of Law and Economics, Bouckaert, B and de Geest, G, Eds., pages 129-188. Northampton, MA: Edward Elgar.

  1. Dean Baker. The Reform of Intellectual Property
  2. Problems with Intellectual Property: rapid overview of main arguments by Geshan Manandhar.
  3. Against Intellectual Property. By Brian Martin
  4. an overview of intellectual property regimes and their evolution, by economists of the Regulation School, at http://www.upmfgrenoble.fr/irepd/regulation/Lettre_regulation/index.html
  5. Theories of Intellectual Property, by William Fisher, at http://cyber.law.harvard.edu/people/tfisher/iptheory.pdf
  6. Copying and Copyright, by Hal Varian, at http://www.sims.berkeley.edu/%7Ehal/Papers/2004/copying-and-copyright.pdf
  7. Legal aspects of peer to peer technology, by Pamela Samuelson, at

http://www2.sims.berkeley.edu/academics/courses/is296a-2/s05/

Blogs

David Levine's blog against Intellectual Monopoly, at http://www.againstmonopoly.org/

Key Books to Read

Copyrights and Copywrongs: The Rise of Intellectual Property and How It Threatens Creativity by Siva Vaidhyanathan

"A fascinating journey through the cultural history of copyright law. Copyrights and Copywrongs is remarkably readable, mercifully free of legal jargon, and entertaining. It is also thoroughly researched and includes extensive notes and references. This text belongs on the shelf of anyone interested in the ethics and development of copyright." - International Journal of Law and Information Technology

Boldrin, Michele and Levine, David. Against Intellectual Monopoly. 2005

Available online at http://levine.sscnet.ucla.edu/general/intellectual/against.htm

"It is common to argue that intellectual property in the form of copyright and patent is necessary for the innovation and creation of ideas and inventions such as machines, drugs, computer software, books, music, literature and movies. In fact intellectual property is not like ordinary property at all, but constitutes a government grant of a costly and dangerous private monopoly over ideas. We show through theory and example that intellectual monopoly is not neccesary for innovation and as a practical matter is damaging to growth, prosperity and liberty."

Bibliography

Economic aspects of IP

  1. Boyle, James (1996). Shamans, Software and Spleens: Law and the Construction of the Information Society, Cambridge, MA: Harvard University Press.
  2. Fisher, William W. (2004). Promises to Keep: Technology, Law, and the Future of Entertainment. Stanford, CA: Stanford University Press.

Recommendations by James Boyle:

"The single best starting point for someone who wishes to understand an economic perspective on intellectual property is William M. Landes and Richard A. Posner, The Economic Structure of Intellectual Property Law (Cambridge, Mass.: Belknap Press, 2003). The story laid out in this chapter is one largely (but not entirely) focused on the idea of intellectual property rights offered as incentives—the carrot that induces the author to write, the inventor to research, the investor to fund that research, and the corporation to develop attractive and stable brand names that convey reliable information to consumers. This is conventionally known as the ex ante perspective. But as the chapter also hints, intellectual property rights, like property rights in general, have a role after the innovation has occurred—facilitating its efficient exploitation, allowing inventors to disclose their inventions to prospective licensees without thereby losing control of them, and providing a state-constructed, neatly tied bundle of entitlements that can be efficiently traded in the market. Readers interested in these perspectives will benefit from looking at these articles: Edmund Kitch, “The Nature and Function of the Patent System,” Journal of Law and Economics 20 (1977): 265–290; Paul J. Heald, “A Transaction Costs Theory of Patent Law,” Ohio State Law Journal 66 (2005): 473–509; and Robert Merges, “A Transactional View of Property Rights,” Berkeley Technology Law Journal 20 (2005): 1477–1520. Of course, just as the incentives account of intellectual property has its skeptics, so these ex post theories attract skepticism from those who believe that, in practice, the rights will not be clear and well-delineated but vague and potentially overlapping, that the licensing markets will find themselves entangled in “patent thickets” from which the participants can escape only at great cost or by ignoring the law altogether. It is worth comparing Michael A. Heller and Rebecca S. Eisenberg, “Can Patents Deter Innovation? The Anticommons in Biomedical Research,” Science 280 (1998): 698–701, with John Walsh, Ashish Arora, and Wesley Cohen, “Effects of Research Tool Patents and Licensing on Biomedical Innovation,” in Patents in the Knowledge-Based Economy (Washington D.C.: National Academies Press, 2003), 285–340. There is a nice irony to imagining that the necessary mechanism of the efficient market is “ignore the property rights when they are inconvenient.”

The skeptics argue that the alternative to a deeply commodified world of invention and innovation, with hundreds of thousands of licensing markets, is a rich information and innovation commons, from which all can draw freely, supporting a thin and well-defined layer of intellectual property rights close to the ultimate commercially viable innovation. The rhetorical structure of the debate—replete with paradox and inversion—is laid out in James Boyle, “Cruel, Mean, or Lavish? Economic Analysis, Price Discrimination and Digital Intellectual Property,” Vanderbilt Law Review 53 (2000): 2007–2039. For some of the difficulties in the attempt to arrive at a coherent economic theory of intellectual property, see James Boyle, Shamans, Software, and Spleens: Law and the Construction of the Information Society (Cambridge, Mass.: Harvard University Press, 1996), 35–46. Finally, while I urge that at the outset we must care about the actual effects and economic incentives provided by intellectual property rights, I am by no means asserting that we should stop there. Indeed to do so would dramatically impoverish our view of the world. James Boyle, “Enclosing the Genome: What Squabbles over Genetic Patents Could Teach Us,” in Perspectives on Properties of the Human Genome Project, ed. F. Scott Kieff (San Diego, Calif.: Elsevier Academic Press, 2003), 97, 107–109." (http://www.thepublicdomain.org/download/further-reading-collected/)


History of IP

Recommendations by James Boyle:

"My own understanding of the history of “intellectual property”—itself a relatively recently invented and contentious category—has been profoundly influenced by more scholars than I can list here. Edward C. Walterscheid, The Nature of the Intellectual Property Clause: A Study in Historical Perspective (Buffalo, N.Y.: W. S. Hein, 2002), gives a magisterial account of the origins of the U.S. Constitution’s intellectual property clause. Tyler T. Ochoa and Mark Rose, “The Anti-Monopoly Origins of the Patent and Copyright Clause,” Journal of the Patent & Trademark Office Society 84 (2002): 909–940, offer a vision of the history that is closest to the one I put forward here. In addition, Tyler T. Ochoa, “Origins and Meanings of the Public Domain,” University of Dayton Law Review 28 (2002): 215–267, provides the same service for the concept of the public domain. Malla Pollack provides a useful historical study of the contemporary understanding of the word “progress” at the time of the American Constitution in Malla Pollack, “The Democratic Public Domain: Reconnecting the Modern First Amendment and the Original Progress Clause (a.k.a. Copyright and Patent Clause),” Jurimetrics 45 (2004): 23–40. A rich and thought-provoking account of the way that ideas of intellectual property worked themselves out in the context of the corporate workplace can be found in Catherine Fisk, Working Knowledge: Employee Innovation and the Rise of Corporate Intellectual Property, 1800–1930 (Chapel Hill: University of North Carolina Press, forthcoming 2009).

Of course, the history of copyright or of intellectual property cannot be confined to the two figures I focus on principally here—Jefferson and Macaulay—nor cannot it be confined to the Anglo-American tradition or to the debates in which Jefferson and Macaulay were participating. Carla Hesse, Publishing and Cultural Politics in Revolutionary Paris, 1789–1810 (Berkeley: University of California Press, 1991), is vital reading to understand the parallels between the Anglo-American and droits d’auteur tradition. It is also fascinating reading. For studies of the broader intellectual climate, I recommend Martha Woodmansee, The Author, Art, and the Market: Rereading the History of Aesthetics (New York: Columbia University Press, 1994); Peter Jaszi, “Toward a Theory of Copyright: The Metamorphoses of ‘Authorship,’ ” Duke Law Journal 1991, no. 2: 455–502; Mark Rose, Authors and Owners: The Invention of Copyright (Cambridge, Mass.: Harvard University Press, 1993); Lyman Ray Patterson, Copyright in Historical Perspective (Nashville, Tenn.: Vanderbilt University Press, 1968). The British debates at the time of Macaulay are beautifully captured in Catherine Seville, Literary Copyright Reform in Early Victorian England: The Framing of the 1842 Copyright Act (Cambridge, U.K.: Cambridge University Press, 1999). (It should be noted that, while sympathetic, she is less moved than I by Macaulay’s arguments.)

Any collection of historical works this rich and complex resists summary description—nevertheless, I think it is fair to say that the vast majority of these works stress the centrality of the skeptical “antimonopolist” attitudes I use Jefferson and Macaulay to represent to the history of intellectual property. This does not mean there is unanimity or anything close to it. In particular, Adam Mossoff, “Who Cares What Thomas Jefferson Thought about Patents? Reevaluating the Patent ‘Privilege’ in Historical Context,” Cornell Law Review 92 (2007): 953–1012, which came to light late in the writing of this book, offers a thoughtful historical account that criticizes the tendency to use Jefferson’s views as representative of a dominant strand in American intellectual property. My agreements and disagreements with Mossoff’s arguments are discussed fully later in the notes to this chapter. The central point, however, and the single strongest argument against those who would instead attempt to construct a more absolutist, physicalist or labor-based theory of intellectual property, is the problem of limits. Where does one stop? How can one put a limit on the potentially absolute claim over some intellectual creation? How can one specify the limits on prior creators that actually give me ownership over what I create, for I surely have built on the works of others? How can one circumscribe the negative effects on speech, life, and culture that the absolutist or maximalist tradition threatens to generate? My ultimate argument is that the purpose-driven, skeptical, antimonopolistic tendencies of Jefferson and Macaulay answer those questions far better than any contending theory, that they represent not merely an intellectual history sadly neglected in today’s political debates, but a practical solution to the inevitable question, “where do you draw the line?” (http://www.thepublicdomain.org/download/further-reading-collected/)

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