From Mindspillage
I go to a lot of talks and hearings and events. Sometimes I take notes.
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CCIA Fair Use Study: 27 Apr 2010
Panelists: Ed Black (CCIA), Thomas Rogers & Andrew Szamosszegi (Capital Trade; study authors), Peter Jaszi (AU)
Released study is here: http://www.ccianet.org/CCIA/files/ccLibraryFiles/Filename/000000000354/f air-use-study-final.pdf
Press release
"Industries that rely on fair use exceptions to copyright law grew faster than the rest of the U.S. economy from 2002 to 2007, expanded 5 percent and accounted for 23 percent of real economic growth, according to a new economic study. The Computer & Communications Industry Association released its 2010 economic study "Fair Use in the U.S. Economy" on Capitol Hill today.
CCIA commissioned the study conducted using publicly available government data and World Intellectual Property Organization methodology. It found companies benefiting from limitations on copyright-holders' exclusive rights, such as "fair use" - generated revenue of $4.7 trillion in 2007 - a 36 percent increase over 2002 revenue of $3.4 trillion. The most significant growth over this period was in Internet publishing and broadcasting, web search portals, electronic shopping, electronic auctions and other financial investment activity.
As for jobs, employment in fair use industries grew from 16.9 million in 2002 to 17.5 million in 2007. One out of eight U.S. workers is employed by a company that benefits from protections provided by fair use and industries relying on fair use and other copyright exceptions make up one-sixth of the U.S. economy, according to the report. The report updates a comprehensive 2007 study that shows the importance of fair use." http://www.ccianet.org/index.asp?sid=5&artid=158&evtflg=False
Session notes
Ed Black from CCIA opens the panel, pointing out that many industries depend on fair use, citing examples of products: dvd players, xerox machines, tivo. Fair use expands not only manufacturing business but also the copyright industry.
Fair use industries are now responsible for ~$4.7T in the US economy; 36% increase over 2002, and 17.5M jobs. Mentions the popular lack of understanding that innovation happens in many ways, and copyright is only one track to innovation; fair use has invigorated economic growth. Another popular misconception is that more IP protection equals innovation--but increasing copyright ends up costing the non-copyright economy; with increased restriction costs increase but benefit does not.
A. Szamosszegi discusses the study, an update to a prior study. "Fair use" here includes all limitations & exceptions to copyright. "In real life, the corner solution is almost never the correct solution." AS mentions that while no enforcement is harmful, so is copyright enforcement without fair use. Fair use is playing an important role in recent economic growth; the study's goal is to measure those contributions. It looks at industries that form the fair use core and non-core industries (listed in appendix 1 of the study, including several electronics manufacturing and sale, publishing and media, finance, information services, entertainment, and education segments).
Study uses the WIPO framework of analysis in order to be comparable to other studies from other viewpoints, looking at gross output (revenue), value added, employment, payroll, int'l trade. Also notes productivity and efficiency of these industries: the prices for goods and services in many fair use industries decline over time. Study claims 23% of real GDP is from industries dependent on fair use.
P. Jazsi: Opens stating "gaps in copyright aren't a bug, they're a feature". Mentions the success of copyright is a function of the whole system rather than just one part; maintaining copyright flexibility is as important as strong content protection. Many copyright industries owe their existence to fair use: all new cultural/information products depend on what has come before; technical interoperability, musical imitation, movies/tv references, also without copyright flexibility education grinds to a halt.
US is actively exporting strong copyright norms, claiming 1) US creative production deserves protection from misappropriation in foreign markets, and 2) strong IP protection has been good for US and it will be good for other countries locally. But US doesn't seek to export its successful approach to fair use; do we play fair by emphasizing strong IP and strong penalties for violations while de-emphasizing or not mentioning other features like fair use?
Jaszi wonders how US would fare in a more restrictive international system than our own where US-style enforcement exists but not the corresponding flexibilities and limitations; this report intended to inform not only domestic but int'l policy goals. He summarizes fair use as well as the limitations and exceptions currently existing.
Mentions legal climate: inevitable that as pressure builds in copyright world, fair use as "default safety valve" will increase, courts will give more information about the scope of the doctrine. Particular interest is non-consumption transformative use of copyrighted materials; more emphasis lately on nature of use as the deciding factor. Views "re-vision" of fair use in past ~20yrs is healthy. Jaszi opposes efforts to revise section 107 to make it clearer: it is important to recognize value in dynamism, we don't want to lose this by restricting fair use too much and being unable to adapt to new technologies with laws that become outdated.
Rep. Lofgren: appreciation for balance in copyright laws is not as pervasive as is necessary for its survival. Mentions purpose of copyright, "promote" and "limited" are important terms, but this provision has been frustrated in modern times. Fair use essential for WWW, for example. DMCA overreach was controlling development of technology in an effort to protect content, it chilled and continues to chill development of technology.
Mentions many representatives bemoaning the inability to make copyright protection permanent as evidence of lack of understanding of fair use and its benefits: creators deserve "recognition and concern", but should not own the subject matter. Mention net neutrality also as way for content owners to control access to content that other reps. do not appreciate.
Mentions ACTA draft, does not understand why it was classified. Sees it as a problem because not everywhere has the equivalent of our 1st amendments; ACTA is all about enforcement, not balancing rights. We should protect ourselves from foreign counterfeiting--but there are rights that are in our interest "as a country that believes in freedom", and we must talk about a freedom agenda when talking about int'l IP, not allow those freedoms to be restricted for commercial purposes. (E. Black interjects: copyright is a regulatory system; copyright without fair use is probably unconstitutional; for something granted in order to preserve social benefit, must weigh costs and benefit, not just look at benefit but not cost is trying to achieve functional result.) Content industry has been successful in int'l trade, which is good for US and for them specifically, but would be stupid to lose the technology industry as a consequence. Making a good governance argument doesn't always win in Congress; a good economic argument usually does. If we eliminate fair use we pay a terrible economic price.
J. Band asks about the relationship between the many recent studies and their conclusions. Black: we chose to follow same methodology, but have been more transparent with data etc. Lofgren: assumptions of all piracy as representing lost sales are bad; the numbers don't reflect reality. Black: not all who pirate could buy. We agree that more IP protection is good in places where there was none, but our focus has gotten shifted to asking for more protection in already-balanced regimes. Lofgren: it would be a serious mistake to move forward with ACTA. Black: copyright "in moderation, in can be wonderful; in excess, it can be deadly."
Comments
As I saw the Chamber of Commerce GIPC study and its discussion, I'll editorialize a bit: one thing that makes public conversation difficult here is that the GIPC study and this one are both claiming the same jobs and the same industries as responsible for their success.
The GIPC study examines 27 industries, separating into "IP-intensive" and "non-IP-intensive" industries producing tradable goods, with the divider being those whose R&D expenditure per employee is greater than average and those whose are not. GIPC claims computer and manufacturing industry (one of its IP-intensive sectors) revenues as justifying greater IP enforcement, where CCIA is counting it as a core fair use industry and including its revenues in the $4.7T figure.
This study is, IMO, guilty of some of the same sort of overreach as the Chamber study; maybe necessary if considered as being in response to it but still lamentable: it becomes subject to the same criticisms.
Of course, several people from the USTR office were in attendance for the World IP Day events and quoting from the GIPC study; none were present for the CCIA study...