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Copyright and (Un)Human Creativity

What does the rise of data-driven authorship mean for the future of art, culture, and intellectual property rights?

In previous posts we have sketched out the rapidly-evolving world of streaming content. The rise of streaming has reordered power in Hollywood and in the music business, sometimes in dramatic ways. But as we describe at length in The Second Digital Disruption, it also has major implications for intellectual property law.

According to the consequentialist justification for copyright, which is the dominant justification in American law, strong copyright is viewed as necessary because creative production is by its nature a high-risk enterprise. The primary role of copyright is to protect against copying, so that the large up-front investment in creative work can be more safely made.

In the absence of such protections, the theory holds, the prospect of unrestrained competition from copyists will deter investment in the production of new creative works. The result will be a persistent undersupply of new works.

Yet in fact there are two chief risks for creative production. One is the risk of market failure -- i.e., risk that no one wants to read, or watch, or listen to, or use, the work that the author creates. The other is what we call the risk of market success -- i.e., that the work proves to be popular, and that popularity attracts pirates whose unauthorized copies steal away potential customers for the author's work.

Note that not all copying poses this sort of competitive threat -- copies that are low enough quality, for example, may be so undesirable that they fail to divert sales from the author. But so long as copies compete, either with the author's sale of copies of his work, or for substantial opportunities to license that work to others, then this "risk of success" is a threat to the author's incentives to undertake the often-costly enterprise of creation in the first place.

IP law, when properly designed and successfully implemented, can reduce the risk of success. Indeed, the basic premise of copyright law is that the protection afforded helps reduce the risk that copyists will divert away from authors the returns from a successful work.

But copyright (and IP rules generally) have no effect whatsoever on the risk of failure. And for most creative works, the problem is not piracy but a lack of market demand.

As a consequence, the risk of failure is at least as important to authors' creative incentives as the risk of success. Indeed, in economic terms, both types of risk drive down the return that the author expects ex ante on his investment in creation, whether that investment is understood in terms of the monetary cost of creativity or the opportunity cost of engaging in creative work versus some other work with a more predictable return.

And in the real world often it is the risk of failure that looms largest -- many more works fail in the market than succeed and are pirated. A work that is pirated is, in a sense, a successful work. No one wants to pirate works that no one wants.

The risk of failure was, until recently, thought of as something largely exogenous, unpredictable, and addressable only by hunches and market experience.

But what if something were to change such that consumer preferences can be readily discerned to a very high degree, and content better matched to consumer demand that produced at a lower level of risk, such that failure is less likely?

That is the world of data-driven authorship that we appear to be entering. In such a world, it may be that producers -- at least producers who have access to the massive quantity of consumer preference data that makes data-driven authorship possible -- are no longer investing with the same fear of market failure. They can invest with greater confidence.

Data-driven authorship does not guarantee that works will not fail in the market. But it makes failure less likely -- and this advantage is precisely why Time-Warner and AT&T fought so hard to merge in 2018 — Time Warner wanted access to the data that hitching up with AT&T (which runs a big ISP) would provide.

Data-driven authorship is thus likely to have an invigorating effect on creative incentives. By lowering the risk of failure, data-driven authorship lowers the overall risk of engaging in and investing in creative work.

As a consequence, viewed from the ex ante perspective, the overall expected return on any given investment in creative work is higher with the onset of data-driven authorship, even if the scope, duration, and enforceability of copyright is held constant. And that means that if we want to keep the same level of incentive to engage in creative work — that is, if we believe that our current level of incentive is roughly correct and want to preserve it -- we can afford to reduce the scope and/or duration of copyright rights.

This is especially likely to be true because the rise of data-driven authorship also helps reduce, albeit indirectly, the risk of success. So far, at least, the rise of data-driven authorship tends to be the domain of large digital distribution platforms offering big libraries of content and all-you-can-eat pricing. So long as the content is available at a price most are willing to pay, these features tend to drive down piracy rates.

As should be obvious by now, these trends are significant for our understanding how strong and broad IP rights need to be. In a data-driven world the scope or duration of IP rights likely could be substantially reduced with little impact on creative production.

In our next post, we'll think a bit about how that shift is likely to affect public intuitions about creativity, creators, and property claims in creative works.

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  • Soronel Haetir||

    Sorry, but I believe the current regime is more-or-less correct that once the minimal threshold for copyright protection is exceeded copyright attaches with full force regardless of the merits of the work. And whatever its drawbacks may be consumer-preference driven production still vastly passes that bar. Further I believe that basing a work's protection on any subjective element (such as the amount of consumer data that guided production) would be a very dangerous legal development.

  • jdgalt1||

    The present copyright system has the benefits described, but has costs which were skipped over entirely here. When a work is copyrighted, the author (or a subsequent buyer) gets an absolute veto, not only over copying of the original work, but also over any derived work unless the amount of the original used is so "de minimis" as to fall within the nebulous range of fair use.

    In the case of a major creative work such as a movie, that cost may be worthwhile; most fanfic isn't very good. But in the case of things like computer software it may very well prevent the public from getting more creative works than it fosters, and thereby defeats the constitutional purpose of having copyright.

    The answer, in my view, is to eliminate that absolute veto after a reasonable time (say five years maximum), and after that allow anyone to copy a work for a standard royalty amount, similar to the present mechanical licensing scheme for recorded music. The right to collect that royalty could still continue for decades.

    I would also allow this royalty to be paid to the copyright office (meaning when works get "orphaned" you can go on using them, and it's the author's problem to keep the copyright office informed of where he is if he wants to get paid).

    Finally, and most importantly, I would immediately cut short any copyright term that was extended after the work was published, since it obviously wasn't needed to motivate creation of the work. Eldred was decided wrongly.

  • gormadoc||

    Data driven authorship is just very efficient market research. I don't see why that should change the copyright status. The fact that it (currently, not fundamentally) reduces market risks doesn't really change it for me. Sci-fi writers of established brands (Star Wars, Star Trek) don't see as much risk as a popular band or movie director, but they are no less deserving of copyright for it.

  • MatthewSlyfield||

    I read the headline and thought this was going to be about works created by animals. Then I read the story. Sorry, I don't see how market analysis makes the resulting works the result of unhuman creativity.

  • Ben of Houston||

    Our copyrights should be reduced in length, as they are currently quite absurd in length due to the long efforts of the Walt Disney Corporation. However, contrasting data-driven vs creativity-driven works is just an absurd proposition. It's unworkable on it's face, and it would be easy for any company to game around it to gain the benefit of longer copyright length.

  • Michael Cook||

    This dredged up memories of the Louis Nizer 1945 copyright lawsuit over a calypso song (from My Life in Court.)

    It all began with a USO tour to entertain American servicemen stuck with the onerous hardships of wartime duty on the island of Trinidad. Comedian Morey Amsterdam did his part of the USO show, then went to a local club and caught an entertainer called Lord Invader doing a catchy song that spoofed American sailors for drinking coca cola with their rum. This was all near a point of land called Point Cumana. . .

    Anyhow, the tune wasn't particularly original--it was an old folk song from Martinique. (This didn't stop Nizer from eliciting hours of expert testimony on musical derivation in court.) The lyrics were Lord Invader's, as interpreted by the inebriated ears of Amsterdam.

    The Andrews Sisters released Morey's version of the song a year later. Despite being banned from many stations for touting rum (the blue noses missed the blatant prostitution talk) it became an instant hit. Lord Invader got $150,000 (1945$!!!) for infringement, but Morey retained the copyright. Huh?

    Obviously, Louis Nizer was a super-lawyer for our times.

  • MatthewSlyfield||

    " Lord Invader got $150,000 (1945$!!!) for infringement, but Morey retained the copyright. Huh?"

    As I understand it, this is standard with unauthorized/unlicensed derivative works. The copyright owner of the original work is due licensing fees/royalties and other monetary damages, but they are NOT legally entitled to claim ownership (not even part ownership) in the copyright of the infringing derivative.

  • Michael Cook||

    In essence, then, we have two or more copyrights on the same thing. There is the original, the derivative, then there could be a string of derivatives after that. Each infringement would incur a penalty, but also spawn a new "copyright" especially if there are minor modifications? I have patents, but am not aware that patents work like that.

  • MatthewSlyfield||

    "In essence, then, we have two or more copyrights on the same thing. There is the original, the derivative"

    No, the original and the derivative are not the same thing. If i publish and exact copy of your work, that is just a copyright violation and no new copyright is created.

    A derivative work means I use a part of your work to create a new work of my own which adds elements of my own creation.

    To do this and publish my work legally, I need a license from you for the parts of your work that I used, but at no point are you entitled to ownership of the parts of my derivative work that I created myself.

  • MatthewSlyfield||

    It gets even more complicated with music, because as standard practice, the musical score and the lyrics are under completely separate copyrights.

  • Michael Cook||

    One would imagine the possible complications, because when a modern artist covers an old Elvis hit (or even a Madonna number), try as they might they likely are not duplicating precisely the same tones and tempos. Even the creator does not play his own creation over exactly the same way every time. So, is there a "sounds like" rule that lets subjectivity enter significantly?

    Now imagine this problem with lyrics: a Japanese wedding singer records what sounds like a popular Elton John love song in Japanese. He gets a nasty letter from E.J.'s lawyers warning of infringement on lyrics. No, the Japanese defense team argues, in translation these words are all significantly different in meaning and nuance than in English, hence, this is a different song!

    Were you the judge, would you buy it?

  • Michael Cook||

    More trolling for teachings:

    Suppose Country Western star A writes: "My Wife Ran Away with the Post Man" which becomes a smash hit.

    A month later CW star B releases: "My Wife Ran Away with the Garbage Man" which sounds a lot like A's hit.

    Two months later, CW star C releases: "My Girlfriend Ran Away with the Postal Carrier" in a different key than the first two versions because his voice is a lot higher.

    Now it appear that C could be sued by both A and B if he uses the tiniest snippet of each's copyrighted work. However, I recall in literature there is an allowable quotation rule that gives a copier license to use up to several paragraphs of someone else's writings.

    Obviously, in the case of song lyrics, that could be the whole number, especially when there is a lot of repetition of phrases.

    It may be that non-human intelligence is required to sort these fine points.

  • MatthewSlyfield||

    "Now it appear that C could be sued by both A and B if he uses the tiniest snippet of each's copyrighted work. However, I recall in literature there is an allowable quotation rule that gives a copier license to use up to several paragraphs of someone else's writings."

    No. You are thinking of fair use doctrine.

    1. Under US Copyright law, there are no fixed quantities that make or break a fair use claim. How much of the work can be used under fair use is determined case by case based on the size and nature of the work and the use to which it is put. For example, with images, use of the entier work can often qualify as fair use.

    Commercial use as in this your hypothetical will almost never qualify as fair use.

    2. Unlike patents, Independent creation is a valid defense against copyright claims.

    IF C can prove that he wrote his music and lyrics before the public release of A's work, A&B would have to prove that C was aware of their works when he wrote his in order to sustain a copyright claim.

  • MatthewSlyfield||

    3. Very similar situations have been repeatedly litigated in the music industry I don't recall the exact case, but there was one a few years ago where a musical artist had released a work where the entire work was x seconds of silence.

    Another musical artist released a work that was not all silence, but included a span of y seconds of silence where y was less than x.

    The first artist sued the second. I don't recall the outcome.

    Another thing that you have to keep in mind is that not every aspect of a work subject to copyright is protect-able by copyright, For example, under US copyright law you can't copyright facts. The organization and structure in which those facts are presented may be copyrightable, but they may not be if the the organization is dictated more by function than by the creative efforts of the author. This was litigated decades ago over phone books. The phone companies lost.

  • MatthewSlyfield||

    "Now imagine this problem with lyrics: a Japanese wedding singer records what sounds like a popular Elton John love song in Japanese."

    Did the Japanese wedding singer do this recording in the US or in Japan. If the recording happened in Japan, E.J would have to sue in Japan under Japanese copyright law. In which case, I have no idea what the outcome would be.

    If it happened in the US? Does E.J. own the copyright to the music, the lyrics or both? Under use law, with songs, the music and the lyrics are almost always separate copyrights and usually have different authors and occasionally different owners.

    "Were you the judge, would you buy it?"

    I am not a lawyer, but I work in a field where copyright is relevant, so I've made a bit of an effort to understand US copyright law.

    For the musical score, what you describe is likely a straight copyright violation.

    As i understand US law as regards lyrics, to be a straight copyright violation rather than an unlicensed derivative work, it would have to be an exact literal translation. Which almost never works with music, because an exact translation won't fit the cadence of the music.

    However, even as a derivative work, it's still a copyright violation and the Japanese wedding singer would owe, E.J. damages and royalties for future publication/performances.

    That said, the derivative work is still a separate work with a separate copyright and that still belongs to it's separate author.

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