The Digital Media Project

 

Source

Philip Merrill

Title

TRU #35 of economic exploitation

No.

040929merrill02

 

Name:

Philip Merrill

Affiliation/additional information:

Active Contributor, Pasadena, California

Date submitted:

2004/09/29

 

#

Criteria

Description

1.

Name of TRU

Right of economic exploitation

2.

Summary description of TRU

a creator's right to receive economic benefit from their intellectual product normally comprising a predictable distribution chain such that uses outside of that might be considered fair use; for movies a conventional media exploitation chronology supposes theatrical release followed by tape/optical media sales followed by pay TV then cable premium channels and then broadcast television

3.

Use records of TRU

Beginning with the creation of a primitive glob of intellectual property -- virtually valuable but of little physical financial value -- the challenge for any Author or other creator is to turn that glob into money. Everything about how the money comes in and what the writer, artist, performer, or other creator of some original IP has to do to get that money becomes vitally important to the person the money is coming to.

For example, at one point decades ago, rock star Billy Idol was supposedly confronted about his shocking appearance and clothing and answered, to paraphrase, "Don't ask me. Ask my label. They're the ones who decide what I look like. It's in the contract." This anecdote might be false, but it illustrates the trade-off a top pop star might make between wearing what they want to wear versus becoming millionaires who wear what the record label tells them to.

A major issue for artists is advances on income, since these are at times the only money an artist will receive for a project. In itself, an advance is preferable to doing everything "on spec" -- for nothing, or speculatively. Unlike the money that eventually comes in, drifting in slowly as it passes through the hands of many Middle-Men (players on this value-chain that permits revenues to eventually come back to the Author), an advance is money an artist can put in their pocket right away and start spending. This can be critical for producing or performing the work. For example, one new age recording artist said he generally spent half of his advances on projects buying new gear to use for that recording.

Several major clusters of TRUs have been written in templates for Authors and other creators, and these may be examined for an overview of the scope of economic exploitation that an Author or artist might generally feel entitled to:

  • TRU moral rights -- In some ways the paramount thing for an Author is their name as it will appear in materials letting the public know how to buy their globs of IP, and subsequently the Author needs what is delivered to the End-User to have sufficient quality so as to be a good representation of their work.
  • TRU reproduction -- Copying has traditionally been critical to analogue distribution and meaningfully charging people for the consumption of IP, and of course digital copying now unleashes a greatly increased capacity for worldwide copying and transferring of IP-sensitive materials.
  • TRU to restrict performance -- Performance rights may seem hazy and are often administered by a collecting society (this administration can also seem hazy to the uninitiated). However, these can mean millions of very specific dollars for a successful title. A public television show once said songwriter Irving Berlin's donation to the Boy Scouts of America coming exclusively from royalties for the song "God Bless America" amounted to six million dollars. So whatever happens in the loose copying land of performance money, something meaningful is happening economically to generate that much cash.
The template for TRU to restrict performance refers to a metaphorical "stream of economic exploitation". This is what happens to the Author's glob of IP so that money drifts back to the author along the value-chain. Although the metaphor is particularly suitable to performing rights (or defining boundaries for fair use), it applies equally to TRU moral rights and TRU reproduction. This metaphor is vague, however, intentionally jumbling together a multitude of economic TRUs and transactions into a unity concealing ordered chaos -- much like the classic illustration of the telco cloud used in diagrams of Internet data transmission.

Greater detail can be visualised by imagining timelines for an IP glob's "media exploitation chronology" (see also citation at TRU lending), as described in the Summary above. The crux of the problem for Digital Media Usages is that so many of them are unexpected, unlicensed and unable to be assigned a fair market value, leading the programmers who enable them to make excessive claims of TRU fair use. In other words, a normality became blessed by time and practice in the world of analogue media allowing the path of the stream of economic exploitation to be relatively predictable (although this has been complicated since Star Wars by extremes of franchised cross-market merchandising). Whatever predictability exists at present for Digital Media, it generally does not involve very remunerative returns.

4.

Nature of TRU

Article 9(2) of the Berne Convention says, "It shall be a matter for legislation in the countries of the Union to permit the reproduction of such works in certain special cases, provided that such reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author." This 3-step test approach has been followed in other treaties and can be considered to enshrine this notion that analogue media follows a predictable general course of "normal exploitation" (although see Paul Goldstein comment under "Possible Digital Support" at TRU reproduction).

Much of the conflict between Digital Rights Management and "fair use" that presently polarises opinion regarding digital Usages results from the fact that Digital Media does not have a settled and normal path for revenues to travel back up a distribution chain to Authors and other Rights-Holders. WIPO treaties and international practice have instead focused on enabling TRU technological access restrictions, and these have been overly restrictive, lacking in flexibility, non-interoperable, etc.

5.

Benefits of TRU

Authors/Rights-Holders and Middle-Men.

6.

Possible digital support

This is of course key to the success of DMP's goals, since the development of interfaces for the value-chain connecting Author to End-User could provide an unprecedented range of choices to allow the underlying Work in a piece of Digital Media as well as the distribution of DM Content to be economically exploited.

At sec. 3.2.3.I of International Copyright, Paul Goldstein says, "Characterized at the highest useful level of abstraction, an economic right subject to national treatment under the 1971 Berne Paris Act consists of three elements: it is effective against the world at large; it enables the author to control, or benefit from, the use of a literary or artistic work; and it values the use of the work, however roughly, proportionate to the work's success or prospective success in the marketplace." The first of these could be considered to be supported by technological access restrictions. The second and third will be referred to here as "control" and "valuation" respectively.

Enabling a multitude of DMP controls for "media exploitation chronologies" could improve an Author's potential economic success in many ways. For example, the initial distribution of a work often involves a promotional window in which remuneration is less important than "getting the word out". Aggressive promotional measures followed by a closing off of this period in which people are encouraged to "taste for free" could be managed in real-time through a Device's user interface. There is generally also a subsequent window of maximum sales potential, and the opening and closing of this period of time could also be better exploited with advanced, digitally enabled means of control.

Goldstein's point on "valuation" pertains among other things to TRU of equitable remuneration. Industry bodies could assign minimum values or provide for Rights-Holders to be able to waive any charge, and then premium, highly desirable Usages could be priced with a valuation that was broadly arrived at through initial auction or subsequent statistical measurements of frequency and type of use.

7.

Requirements

none at this time