Non-Commercial Clause

= a clause meant to inhibit commercial exploitation of a work, found in some licenses such as variants of the Creative Commons

The issue is whether this clause is compatible with true Open Licenses

Discussion

Stephen Downes

Excellent presentation of this complex subject at http://halfanhour.blogspot.com/2008/12/open-content-enclosure-and-conversion.html

Critique by Appropedia

"There are two major problems with non-commercial (NC) licenses:

• The two main open content licenses (GFDL and CC) are not compatible, so (for example) CC content cannot be used on wikis using GFDL, including Appropedia and Creative Commons. There has recently (November 2007?) been a breakthrough and it is hoped that this problem will soon be overcome. In the mean time, multi-licensing is a way of keeping content as open as possible.

• Much content online which is under a relatively open license has a non-commercial clause, specifically the CC-by-nc (or CC-by-nc-sa?) license. This is not "open content" in the same sense (the term might be a bit vague, but some would reject calling it "open content" at all). Many international bodies such as the FAO have their own statements to the same effect - you can use it for non-commercial use only. Any content with this kind of clause cannot be used in a publication or website operating on the more open license types that don't have the clause. For example, FAO content cannot be used on Appropedia (apart from the standard fair use provisions, small quotes etc).

Concerns with licenses allowing commercial use:

A Virgin mobile advertising campaign used people's personal photos, licensed under a CC license, from Flickr, and caused a storm of controversy. This highlights one potential problem with allowing commercial use: People may use the content (including images) in ways you don't want. This may not matter if it's a photo of a sand filter, but it probably does matter if it's a photograph of a family member, friend, or publicity shy person, particularly "cute," amusing or embarrassing shots. Thus it is recommended that sensitive material (personal photos, photographs of other people, and especially photographs of children) be considered carefully before choosing a license." (http://www.appropedia.org/Non-commercial_clause)

Critique by Rob Myers

"The production of content is a cost, to be sure, but its distribution is the only revenue stream and free exchange has the potential to undermine this.

To prevent such loss (for individual producers as well as institutional distributors), Creative Commons have produced a “NonCommercial” licence that reproduces the freedoms guaranteed by Free Software “Copyleft” licences such as the GNU GPL but with the proviso that use and distribution of the work must not be “commercial” in nature. This is the “Creative Commons NonCommercial-Attribution-ShareAlike License”, or NC-SA for short.

It is not clear that NC-SA achieves its aims. The licence explicitly allows p2p sharing, which is classified as commercial activity under US law and is the development most blamed for loss of revenue by the recording industry. NC-SA allows people to download work over ISP connections using a personal computer and store it on an MP3 player or burn it to a CD then print it out at copy shops. These are all paid goods and services, making money from an individual’s use of an unpaid-for NC-SA work. The only person who doesn’t make money in this scenario is the person who has released the work as NC-SA.

Having given away the ability to freely copy work, the major loss of revenue according to the recording industry, NC-SA tries to lock the stable door not on the author losing money but on other people making money, and fails to do so except in the most direct cases of exploitation.

Exploitation

NC does not stop people making CDs of work, incorporating it into their videos, incorporating it into promotions for events or putting it onto peer-to-peer networks. These are all uses an author could expect to be paid for. Rather than ensuring that the author is paid, NC tries to prevent anyone else from being paid. It fails in all but a few cases. It makes the work into a white elephant, something that can only cost money. Or it makes the work free advertising, paid for by the consumer.

Copyleft, Attribution-ShareAlike or BY-SA (without the NC) in Creative Commons terms, discourages commercial exploitation of work in film, video, and other derivative work. Where it does not, the resulting work will be Free, which is an ethical and reputational gain. BY-SA doesn’t prevent commercial redistribution, but then NC doesn’t prevent noncommercial distribution, which is the main competitor for authors. The main sources of actual revenue that BY-SA doesn’t manage that NC-SA does are commercial distribution of work in CD form and on commercial radio.

It is possible to compete with others copying your work, turning their efforts into promotion. iTunes Music store does. Radiohead’s “In Rainbows” release is an example of comprehensively and successfully competing with leakers and filesharers. The Happy Mondays printed their own bootleg t-shirts and got a friend to sell them outside venues to compete with the real bootleggers.

Royalties

NC prevents people selling CDs or downloads of work and playing it on commercial radio without paying performance dues. Under SA, the former can be competed with successfully through good release management. That leaves performance rights. Again, commercial radio can be competed with via streaming. And it has positive reputational network effects (it’s free advertising, just make sure you have something to actually sell or be paid for).

Hackers do not complain when a distro packages their work and charges for distributing it. It is recognised that the distributor is providing a service. They provide new users and developers for projects, and build the reputation of projects that they feature. Over time some have come to invest back into the production of the software that they have benefited from.

Authors can view commercial distribution of their work similarly, even where, like distribution of software that one has written, to charge would make money where distro packaging does not. But unlike hackers they can compete with and benefit from this directly. A song can be performed, packaged in a deluxe format or dedicated in a way that a JPEG decompression library cannot, although the distribution of both can lead to further work.

Details

Distribution allows people to hear speech. Where changes to that distribution cause economic harm that reduces authors ability to speak, this can be addressed. For example by reputation economics of scale to offset the loss of performance royalties through network effects on the things you do charge for. That is better than having to pay MTV to play your videos, which is what they wanted. And it will allow ways of your fans finding you to develop that would otherwise be stifled, such as Internet radio.

The current economic ecosystem for music is very complex, with risk and rewards shifted between participants over time and investment and payment flowing to and from many different avenues. This system worked well enough before the Internet but is currently broken and to restore it would cause far greater social harm than just the current lawsuits.

One possible replacement would be similar to the business model of Radiohead’s “In Rainbows”, but with feeling. Release paid downloads before anyone can leak the masters, follow up with deluxe vinyl and digipacks, see who will pay to wrap video sessions with advertising, do sell CDs, perform live as much as you can, and make sure you sell lots of merchandising. This isn’t the only way of doing it, but it is a drop-in replacement for the current model.

Conclusion

Free Culture is an ethical matter. As with Free Software, economic concerns are secondary. Stallman’s categories do not capture this ethics. NC-SA does not protect it, or very much else. Lessig describes a perfect storm of technology, law and economics threatening free speech. Free speech must be protected as a vital part of open, pluralistic society. Any harmful economic effects of this can be borne *if* you find the ethical claims of Free Culture convincing and its aims worthwhile." (http://www.robmyers.org/weblog/2008/03/14/persuasion-1/)

Proposed solution by Peter Bihr

Peter Bihr:

"An open question: Would it make sense to add a layer of licensing (or rather: meta-licensing) to Creative Commons that would allow easier (speak: quicker) use of CC-licensed content for commercial use?

The problem: Professionals can’t use CC non-commercial content!

Maybe - just maybe! - another lay of meta-licensing would help. The option to say: I allow non-commercial use of my works for anyone. But I also wouldn’t mind commercial use as long as I can veto it in case the wrong folks want to use it. (”The wrong folks” here, of course, just meaning anyone the creator doesn’t want to be associated with.)

Creative Commons isn’t primarily about commercial success, but it sure helps the cause of CC to encourage commercial use. (The CC Casestudies Project collects CC success stories, also commercial ones.)

So how could this look like? Very naively, I imagine it implemented as a tickbox: Yes, in theory I allow commercial use of this photo, but only after I get notified first. As soon as someone wants to use it and clicks the corresponding button, please do send me a text message/email/whatever alert. This is a channel that I can guarantee to check with top priority, so that if I don’t veto the action within 30 minutes I agree to this photos use.

Of course there’s plenty of loose ends here and aspects not thought through to the end, and there’s plenty of arguments against this model. (Simplicity for one, and a more fundamental push for more open sharing.)

So the question is: Would this make sense for Flickr & Co to implement, and what speaks for and against it?" (http://www.thewavingcat.com/2008/12/13/a-second-layer-for-commercial-use-of-creative-commons-content/)

More Information

1. What is non-commercial use, FAQ at https://creativecommons.org/faq/#does-my-use-violate-the-noncommercial-clause-of-the-licenses