Overview
Several findings have been made in this study. The following factors have been isolated as critical elements of a successful copyright policy. First, the design and implementation of a feasible policy needs to consider the stakeholders’ interests. Second, the cost of implementing infrastructure to deal with the policy changes must be meticulously surveyed. This is an important component to the feasibility of the policy. The third addresses the need to revise the direction of NZ copyright policy to maintain the collaborative, creative nature of the Internet. The fourth finding examines the economic impact of copying and how it can be an opportunity to remedy information asymmetries on product quality. The final findings are based on the U.S. case study.
Stakeholder Support
Stakeholder support is a crucial element to the implementation of a successful policy. This is demonstrated in the 2008 amendment to the Copryright (New Technologies) Act 1994. The public reaction to the amendment of section 92A was clearly negative. Several key stakeholders were vocal regarding concern about the changes. ISPs were concerned about their responsibility to shut down Internet access of repeat infringers.[1] Recreational Internet users were worried about privacy and legal issues. Consumers expressed distaste at being restricted and tracked as if to preempt infringement. Advocacy groups online were also created in response.[2] A submission from the Media and Advertising Copyright Board gave considerable critique of the policy also.[3] The Internet also provided an important forum for gauging public response. The government acted appropriately by revising the policy. However, there is potential to make this process more efficient through a comprehensive public enquiry.
Infrastructure
The cost of infrastructure is a critical component. It is also linked closely with stakeholder response. The implications of the proposed 92A on administrative infrastructure were considerable. The primary concerns were the policing of Internet activity, the administrative costs of implementing punishment protocol, and legal issues that would require a significant amount of time and money for training and the set up of new systems. These also need to satisfy NZ’s international commitments, such as the Berne Convention for the Protection of Literary and Artistic Works. This highlights an area for further research. A Cost-Benefit analysis should be carried out to ensure that national infrastructure is consistent with global efforts.
Consideration of the Commons
The first two findings highlight issues with the current direction of copyright protection policy. The purpose of the remaining findings of the report is to prompt discussion about alternative and innovative directions to counter the problems. The third finding is based on a need to consider the commons differently. It is not to be interpreted as anti-regulation. An enquiry about the effects of regulation on innovation and creativity was completed from various sources. This is a relatively new area of research, particularly because of the rapid technological advances that constantly change the shape of the Commons. Several scholars have debated the impact of over-regulation on the Internet.[4] One of the prevailing ideas is that the Internet represents a commons that enhances creativity across the world. It is the closest resource available to being a universal forum. It has also been a major catalyst for the spread of important ideas and for cultural reproduction.. This counters the reasons why the Internet was created. Ostrom argues that the current policy prescriptions of the ‘Leviathan’ model of centralized control and privatization are too sweeping in their claims. Ostrom also argues for generating different ways of thinking about the mechanisms that individuals use to free themselves from commons dilemmas.[5]
Discourse on copyright policy has demonstrated several key issues in the NZ perspective of copyright protection. This is reflective of a global idea of how such property rights should be governed on the whole. However, there have been studies that show the benefits of understanding copyright protection in a different light. Regulation of the use of creative works can be stifling to creativity and innovation.[6] It can hinder the creative process as individuals are not able to build on the ideas that have preceded them. Larry Lessig is an American scholar who urges a return to the ‘read-write’ culture of the past, as the current situation is ‘read-only’. ‘Read-write’ culture is the ability to use ideas, images and songs and use them as a platform to create something new. ‘Read-only’ allows consumption only. Highly restrictive copyright policy is overly focussed on the control of the Internet. The danger of doing this is that it contradicts the purpose of the Internet as a collaborative forum. This identifies an area for further study on the relationship between copyright regulation and innovation. It does not discredit regulation however, as it is an important aspect in creating incentive to produce and create. Lessig argues that the real danger is not that copyrighted material would be uncontrolled: the real danger is that copyrighted material would be too perfectly controlled. Lessig claims that open resources increase the value of controlled resources by connecting them with free resources.[7] Rose agrees, that in some cases the value of a resource is its ‘publicness’ or increasing participation.
The Economic Impact of Copying
Takeyama demonstrates the potential benefits of ‘unauthorised’ reproduction of intellectual property, especially in the presence of informational asymmetries about product quality. Takeyama uses a two-period, durable goods monopoly with asymmetric information about product quality. At first, the consumers are uncertain about the quality of the firm’s product. Consumers who pirate the good in period one become fully informed by the start of period two.[8] These individuals then have an increased willingness to pay for an original and become potential ‘repeat purchasers’. The results of the study undertaken by Takeyama demonstrate several things. First, copying can benefit the firm as well as producing a Pareto improvement in social welfare. Some high quality firms are unable to earn positive profits because of uncertainty. Copying can therefore potentially solve adverse selection.[9] Second, the presence of copying can generate equilibria where only high quality firms are able to produce and sell at full information prices and without the need to employ costly signalling mechanisms.[10] This study suggests that strict regulation and enforcement of copyrights can lead to missing markets.[11] It does not suggest that copyrights should not be enforced – but emphasising its role in encouraging copiers to subsequently purchase rather than to prevent them from copying at all. For example, software developers sometimes distribute fully functioning versions of their programs. There is a suspension of the copyright for a limited period of time.
[1] This was expressed in popular NZ news sites, such as NZ Herald Online. http://www.nzherald.co.nz/technology/news/article.cfm?c_id=5&objectid=10563178
[2] For example, Creative Freedom NZ voices concern about section 92A and DRM technology. http://creativefreedom.org.nz/s92.html
[3] Media & Advertising Copyright Board. “Submission on the Copyright (New Technologies and Performers’ Rights) Amendment Bill.” Auckland: Media & Advertising Copyright Board, 2007.
[4] Schaum
[5] Elinor Ostrom. “Reflections on the Commons.” In Governing the Commons: The Evolution of Institutions for Collective Action. Cambridge; New York: Cambridge University Press, 1990.
Ramello, Giovanni B. “Copyright and Antitrust Issues.” In The Economics of Copyright: Developments in Research and Analysis, edited by Wendy J. Gordon and Richard Watt. Northhampton: Edward Elgar Publishing, Inc, 2003, p. 139.
[6]Ibid., p. 10
[7] Lessig ‘The Future of Ideas’, 86
[8] Takeyama, 55.
[9] Ibid.
[10] Ibid., 56.
[11] Ibid., 61.