Its been a long time coming, but a change gon’ come.
The “next great copyright act” is the change that Register of Copyrights, Maria Pallante, is calling on Congress to make (perhaps taking a cue from our neighbors up north, eh?) Among the list of changes called for by the Register is reformation in the music marketplace.
It would be difficult to ignore the effect that the current copyright system and new technology has had on the music industry over the past few years. Digital music exploitation (including online downloading and streaming) is quickly becoming the dominant revenue generator for the industry, but this has come at a cost. Pandora and the like, the radio broadcast and the recording industries continue to fight Congress and each other over the music licensing and statutory royalty system, an issue heavily influenced by a rise in new music business models. The first sale doctrine, with respect to digital sales, is another battlefield, as well as the evergreen music piracy issue. Whatever your personal preference or stance, the law is definitely “showing the strain of its age.”
With such a wide range of issues, what should the next great copyright act do to fix the music marketplace? To start, we need to identify what isn’t working- check. Next, we need to develop a game plan to address those issues. I would like to offer my suggestions for the game plan…
Start with the Statute
As every first year law school student knows, analysis of a legal issue always begins with the actual text of the statute. Here, should be no different. In determining the scope of the reform, my first suggestion would be to start with the framework of the U.S. Copyright law, specifically, Section 101 (Definitions) and Section 106 (Exclusive rights in copyrighted works).
Section 101 provides the definitions for certain key terms included in the Copyright Act. Even former Register Marybeth Peters would have to admit that this Section could use a tune-up. For example, I would be hard pressed to find a non-lawyer who has heard of a phonorecord or one who could explain the concept of a digital phonorecord delivery (despite their vast iTunes collection).
My suggestion for Section 101 is two-fold: 1) Update Section 101 to include all key terms in the Copyright Act (for example, adding digital phonorecord delivery to Section 101, where it is not currently listed, or a statutory definition of streaming); and 2) Revise the language in Section 101 to reflect modern colloquial language (for example, replacing phonorecord, with a less legalese-sounding word). This reform, although simple, would benefit the public and music industry participants in better understanding the substantive areas of the statute.
Section 106 provides the five exclusive rights implicated in the music marketplace: the right to reproduce (106(1)); the right to create derivative works (remixes) (106(2)); the right to distribute (106(3)); the right to publicly perform (106(4)); and the right to perform by digital audio transmission (106(6)). The rise of the digital music era has introduced new exploitation of these rights not originally contemplated by the framers of the copyright law. Today, download stores, music streaming services, Internet radio, and subscription services are all an integral part of the recorded music market. Additionally the globalization of the music licensing marketplace continues to influence the use of these rights. Yet, the courts and legislature are still adapting to these changes, playing catch up in attempt to protect the copyright owners and innovators.
A review of each exclusive right within the context of music exploitation would be instructive to understanding the gaps and holes that have been poked into each right by new technology and consumer habits. The public performance right, in particular, will require special attention to address streaming and sound recording protection. Starting with the framework of the current copyright law would afford Congress, the Copyright Office and related parties the opportunity to strengthen the foundation of the framework, before tackling the more esoteric sum of its parts.
DATA DATA DATA
As one intellectual property attorney noted, “the problem with copyright legislation is that it is always interest-driven.” In shaping the next great copyright act, Congress and the Copyright Office should seek to avoid overly biased-rhetoric from industry participants in lieu of using available data to justify future changes to copyright law.
One advantage of living in the digital age is availability and access to information. Industry trade organizations and annual reports, such as the IFPI Digital Music Report and the Nielson Company & Billboard Music Industry Report have provided a substantive glimpse on the industry-at-large, while companies such Apple, Spotify, and Pandora continue to maintain statistics on user consumption habits and content fees. Using this information could help to avoid making arbitrary decisions about the shape and scope of the new law by instead relying on big data.
The Copyright Office could also benefit from this data and technology by developing interactive teaching tools and educational resources for public, such as the Music Collaboration Rights Advisor system, a legal expert system developed by NeotaLogic and myself, to inform the public about potential new changes.
I think that it is also important to come to an understanding on some general principles for the “next great copyright act.” For example, who are we building this new copyright act for and why? The future, of course, and the future is digital. But how has technology shaped or re-shaped the principle values of our copyright system?
The Copyright Clause calls on us “to promote the progress of arts” and as the Register recently noted, this means maintaining copyright law for the benefit of “serving the public interest.” The balance is that the law must also protect the economic interests of the creators. The Copyright Clause affords protection to these individuals by providing them with a limited exclusive right to use their creative creations. The purpose of this is to encourage investment and provide an incentive to continue the production of the arts and sciences. So, when we speak of copyright reform what we really mean to say is ‘the protection of the economic and revenue stream for copyright owners and other interested parties.’ Thus, a new law must continue to contemplate flexibility between these interests, enough to encourage and support innovation and competition among the services and products offered to the public, but also, to some extent, to protect the bottom line. Most importantly, the “next great copyright act” must mend the bridges between copyright-counter culture, the copyleft movement, and Congress.