The Public Domain: Enclosing the Commons of the Mind

Text harvesting and reformatting by Michael S. Hart and Gregory B. Newby.

Copyright (C) 2008 by James Boyle.

The Public Domain

Enclosing the Commons of the Mind

by James Boyle

In this enlightening book James Boyle describes what he calls the range wars of the information age—today's heated battles over intellectual property. Boyle argues that just as every informed citizen needs to know at least something about the environment or civil rights, every citizen should also understand intellectual property law. Why? Because intellectual property rights mark out the ground rules of the information society, and today's policies are unbalanced, unsupported by evidence, and often detrimental to cultural access, free speech, digital creativity, and scientific innovation.

Boyle identifies as a major problem the widespread failure to understand the importance of the public domain—the realm of material that everyone is free to use and share without permission or fee. The public domain is as vital to innovation and culture as the realm of material protected by intellectual property rights, he asserts, and he calls for a movement akin to the environmental movement to preserve it. With a clear analysis of issues ranging from Jefferson's philosophy of innovation to musical sampling, synthetic biology and Internet file sharing, this timely book brings a positive new perspective to important cultural and legal debates. If we continue to enclose the "commons of the mind," Boyle argues, we will all be the poorer.

Professor James Boyle's website: www.thepublicdomain.org

James Boyle is William Neal Reynolds Professor of Law and co- founder of the Center for the Study of the Public Domain Duke Law School. He joined the faculty in July 2000. He has also taught at American University, Yale, Harvard, and the University of Pennsylvania Law School. He is the author of Shamans, Software and Spleens: Law and Construction of the Information Society and The Shakespeare Chronicles, a novel about the search for the true author of Shakespeare's works. He co-authored Bound By Law, (CSPD 2006) an educational comic book on fair use in documentary film, and is the editor of Critical Legal Studies (Dartmouth/NYU Press 1994), and Collected Papers on the Public Domain (Duke: L&CP 2003). In 2003 he won the World Technology Award for Law for his work on the "intellectual ecology" of the public domain, and on the new "enclosure movement" that threatens it; (a disappointing amount of which was foretold in his 1996 New York Times article on the subject.) Professor Boyle has written on legal and social theory, on issues ranging from political correctness to constitutional interpretation and from the social contract to the authorship debate in law and literature.

For the last ten years, his work has focused on intellectual property. His essays include The Second Enclosure Movement, a study of the economic rhetoric of price discrimination in digital commerce, and a Manifesto on WIPO. His shorter pieces include Missing the Point on Microsoft, a speech to the Federalist Society called Conservatives and Intellectual Property, and numerous newspaper articles on law, technology and culture. His book reviews on social theory and the environment, the naturalistic fallacy in environmentalism, and on competing approaches to copyright have appeared in the Times Literary Supplement. He currently writes as an online columnist for the Financial Times' New Economy Policy Forum. Professor Boyle teaches Intellectual Property, the Constitution in Cyberspace, Law and Literature, Jurisprudence and Torts. He is a Board Member of Creative Commons which is working to facilitate the free availability of art, scholarship, and cultural materials by developing innovative, machine-readable licenses that individuals and institutions can attach to their work, and of Science Commons, which aims to expand the Creative Commons mission into the realm of scientific and technical data. He also leads the steering committee which is setting up the Learning Commons, a division of Creative Commons aimed at facilitating access to open education resources. He is a member of the academic advisory boards of the Electronic Privacy and Information Center, the Connexions open-source courseware project, and of Public Knowledge. In 2006 he received the Duke Bar Association Distinguished Teaching Award.

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The Public Domain

Enclosing the Commons of the Mind

by James Boyle

Preface: Comprised of at Least Jelly? 1

Each person has a different breaking point. For one of my students it was United States Patent number 6,004,596 for a "Sealed Crustless Sandwich." In the curiously mangled form of English that patent law produces, it was described this way: 2

A sealed crustless sandwich for providing a convenient sandwich without an outer crust which can be stored for long periods of time without a central filling from leaking outwardly. The sandwich includes a lower bread portion, an upper bread portion, an upper filling and a lower filling between the lower and upper bread portions, a center filling sealed between the upper and lower fillings, and a crimped edge along an outer perimeter of the bread portions for sealing the fillings there between. The upper and lower fillings are preferably comprised of peanut butter and the center filling is comprised of at least jelly. The center filling is prevented from radiating outwardly into and through the bread portions from the surrounding peanut butter.1 3

"But why does this upset you?" I asked; "you've seen much worse than this." And he had. There are patents on human genes, on auctions, on algorithms.2 The U.S. Olympic Committee has an expansive right akin to a trademark over the word "Olympic" and will not permit gay activists to hold a "Gay Olympic Games." The Supreme Court sees no First Amendment problem with this.3 Margaret Mitchell's estate famously tried to use copyright to prevent Gone With the Wind from being told from a slave's point of view.4 The copyright over the words you are now reading will not expire until seventy years after my death; the men die young in my family, but still you will allow me to hope that this might put it close to the year 2100. Congress periodically considers legislative proposals that would allow the ownership of facts.5 The Digital Millennium Copyright Act gives content providers a whole array of legally protected digital fences to enclose their work.6 In some cases it effectively removes the privilege of fair use. Each day brings some new Internet horror story about the excesses of intellectual property. Some of them are even true. The list goes on and on. (By the end of this book, I hope to have convinced you that this matters.) With all of this going on, this enclosure movement of the mind, this locking up of symbols and themes and facts and genes and ideas (and eventually people), why get excited about the patenting of a peanut butter and jelly sandwich? "I just thought that there were limits," he said; "some things should be sacred." 4

This book is an attempt to tell the story of the battles over intellectual property, the range wars of the information age. I want to convince you that intellectual property is important, that it is something that any informed citizen needs to know a little about, in the same way that any informed citizen needs to know at least something about the environment, or civil rights, or the way the economy works. I will try my best to be fair, to explain the issues and give both sides of the argument. Still, you should know that this is more than mere description. In the pages that follow, I try to show that current intellectual property policy is overwhelmingly and tragically bad in ways that everyone, and not just lawyers or economists, should care about. We are making bad decisions that will have a negative effect on our culture, our kids' schools, and our communications networks; on free speech, medicine, and scientific research. We are wasting some of the promise of the Internet, running the risk of ruining an amazing system of scientific innovation, carving out an intellectual property exemption to the First Amendment. I do not write this as an enemy of intellectual property, a dot-communist ready to end all property rights; in fact, I am a fan. It is precisely because I am a fan that I am so alarmed about the direction we are taking. 5

Still, the message of this book is neither doom nor gloom. None of these decisions is irrevocable. The worst ones can still be avoided altogether, and there are powerful counterweights in both law and culture to the negative trends I describe here. There are lots of reasons for optimism. I will get to most of these later, but one bears mentioning now. Contrary to what everyone has told you, the subject of intellectual property is both accessible and interesting; what people can understand, they can change—or pressure their legislators to change. 6

I stress this point because I want to challenge a kind of willed ignorance. Every news story refers to intellectual property as "arcane," "technical," or "abstruse" in the same way as they referred to former attorney general Alberto Gonzales as "controversial." It is a verbal tic and it serves to reinforce the idea that this is something about which popular debate is impossible. But it is also wrong. The central issues of intellectual property are not technical, abstruse, or arcane. To be sure, the rules of intellectual property law can be as complex as a tax code (though they should not be). But at the heart of intellectual property law are a set of ideas that a ten-year-old can understand perfectly well. (While writing this book, I checked this on a ten-year-old I then happened to have around the house.) You do not need to be a scientist or an economist or a lawyer to understand it. The stuff is also a lot of fun to think about. I live in constant wonder that they pay me to do so. 7

Should you be able to tell the story of Gone With the Wind from a slave's point of view even if the author does not want you to? Should the Dallas Cowboys be able to stop the release of Debbie Does Dallas, a cheesy porno flick, in which the title character brings great dishonor to a uniform similar to that worn by the Dallas Cowboys Cheerleaders? (After all, the audience might end up associating the Dallas Cowboys Cheerleaders with . . . well, commodified sexuality.) 7 8

Should the U.S. Commerce Department be able to patent the genes of a Guyami Indian woman who shows an unusual resistance to leukemia?8 What would it mean to patent someone's genes, anyway? Forbidding scientific research on the gene without the patent holder's consent? Forbidding human reproduction? Can religions secure copyrights over their scriptures? Even the ones they claim to have been dictated by gods or aliens? Even if American copyright law requires "an author," presumably a human one?9 Can they use those copyrights to discipline heretics or critics who insist on quoting the scripture in full? 9

Should anyone own the protocols—the agreed-upon common technical standards—that make the Internet possible? Does reading a Web page count as "copying" it?10 Should that question depend on technical "facts" (for example, how long the page stays in your browser's cache) or should it depend on some choice that we want to make about the extent of the copyright holder's rights? 10

These questions may be hard, because the underlying moral and political and economic issues need to be thought through. They may be weird; alien scriptural dictation might qualify there. They surely aren't uninteresting, although I admit to a certain prejudice on that point. And some of them, like the design of our telecommunications networks, or the patenting of human genes, or the relationship between copyright and free speech, are not merely interesting, they are important. It seems like a bad idea to leave them to a few lawyers and lobbyists simply because you are told they are "technical." 11

So the first goal of the book is to introduce you to intellectual property, to explain why it matters, why it is the legal form of the information age. The second goal is to persuade you that our intellectual property policy is going the wrong way; two roads are diverging and we are on the one that doesn't lead to Rome. 12

The third goal is harder to explain. We have a simple word for, and an intuitive understanding of, the complex reality of "property." Admittedly, lawyers think about property differently from the way lay-people do; this is only one of the strange mental changes that law school brings. But everyone in our society has a richly textured understanding of "mine" and "thine," of rights of exclusion, of division of rights over the same property (for example, between tenant and landlord), of transfer of rights in part or in whole (for example, rental or sale). But what about the opposite of property—property's antonym, property's outside? What is it? Is it just stuff that is not worth owning—abandoned junk? Stuff that is not yet owned—such as a seashell on a public beach, about to be taken home? Or stuff that cannot be owned—a human being, for example? Or stuff that is collectively owned—would that be the radio spectrum or a public park? Or stuff that is owned by no one, such as the deep seabed or the moon? Property's outside, whether it is "the public domain" or "the commons," turns out to be harder to grasp than its inside. To the extent that we think about property's outside, it tends to have a negative connotation; we want to get stuff out of the lost-and-found office and back into circulation as property. We talk of "the tragedy of the commons,"11 meaning that unowned or collectively owned resources will be managed poorly; the common pasture will be overgrazed by the villagers' sheep because no one has an incentive to hold back. 13

When the subject is intellectual property, this gap in our knowledge turns out to be important because our intellectual property system depends on a balance between what is property and what is not. For a set of reasons that I will explain later, "the opposite of property" is a concept that is much more important when we come to the world of ideas, information, expression, and invention. We want a lot of material to be in the public domain, material that can be spread without property rights. "The general rule of law is, that the noblest of human productions—knowledge, truths ascertained, conceptions, and ideas—become, after voluntary communication to others, free as the air to common use."12 Our art, our culture, our science depend on this public domain every bit as much as they depend on intellectual property. The third goal of this book is to explore property's outside, property's various antonyms, and to show how we are undervaluing the public domain and the information commons at the very moment in history when we need them most. Academic articles and clever legal briefs cannot solve this problem alone. 14

Instead, I argue that precisely because we are in the information age, we need a movement—akin to the environmental movement—to preserve the public domain. The explosion of industrial technologies that threatened the environment also taught us to recognize its value. The explosion of information technologies has precipitated an intellectual land grab; it must also teach us about both the existence and the value of the public domain. This enlightenment does not happen by itself. The environmentalists helped us to see the world differently, to see that there was such a thing as "the environment" rather than just my pond, your forest, his canal. We need to do the same thing in the information environment. 15

We have to "invent" the public domain before we can save it. 16

A word about style. I am trying to write about complicated issues, some of which have been neglected by academic scholarship, while others have been catalogued in detail. I want to advance the field, to piece together the story of the second enclosure movement, to tell you something new about the balance between property and its opposite. But I want to do so in a way that is readable. For those in my profession, being readable is a dangerous goal. You have never heard true condescension until you have heard academics pronounce the word "popularizer." They say it as Isadora Duncan might have said "dowdy." To be honest, I share their concern. All too often, clarity is achieved by leaving out the key qualification necessary to the argument, the subtlety of meaning, the inconvenient empirical evidence. 17

My solution is not a terribly satisfactory one. A lot of material has been exiled to endnotes. The endnotes for each chapter also include a short guide to further reading. I have used citations sparingly, but more widely than an author of a popular book normally does, so that the scholarly audience can trace out my reasoning. But the core of the argument is in the text. 18

The second balance I have struggled to hit is that between breadth and depth. The central thesis of the book is that the line between intellectual property and the public domain is important in every area of culture, science, and technology. As a result, it ranges widely in subject matter. Yet readers come with different backgrounds, interests, and bodies of knowledge. As a result, the structure of the book is designed to facilitate self-selection based on interest. The first three chapters and the conclusion provide the theoretical basis. Each chapter builds on those themes, but is also designed to be largely freestanding. The readers who thrill to the idea that there might be constitutional challenges to the regulation of digital speech by copyright law may wallow in those arguments to their hearts' content. Others may quickly grasp the gist and head on for the story of how Ray Charles's voice ended up in a mashup attacking President Bush, or the discussion of genetically engineered bacteria that take photographs and are themselves the subject of intellectual property rights. To those readers who nevertheless conclude that I have failed to balance correctly between precision and clarity, or breadth and depth, I offer my apologies. I fear you may be right. It was not for want of trying.

Chapter 1: Why Intellectual Property 1

Imagine yourself starting a society from scratch. Perhaps you fought a revolution, or perhaps you led a party of adventurers into some empty land, conveniently free of indigenous peoples. Now your task is to make the society work. You have a preference for democracy and liberty and you want a vibrant culture: a culture with a little chunk of everything, one that offers hundreds of ways to live and thousands of ideals of beauty. You don't want everything to be high culture; you want beer and skittles and trashy delights as well as brilliant news reporting, avant-garde theater, and shocking sculpture. You can see a role for highbrow, state-supported media or publicly financed artworks, but your initial working assumption is that the final arbiter of culture should be the people who watch, read, and listen to it, and who remake it every day. And even if you are dubious about the way popular choice gets formed, you prefer it to some government funding body or coterie of art mavens. 2

At the same time as you are developing your culture, you want a flourishing economy—and not just in literature or film. You want innovation and invention. You want drugs that cure terrible diseases, and designs for more fuel-efficient stoves, and useful little doodads, like mousetraps, or Post-it notes, or solar- powered backscratchers. To be exact, you want lots of innovation but you do not know exactly what innovation or even what types of innovation you want. 3

Given scarce time and resources, should we try to improve typewriters or render them obsolete with word processors, or develop functional voice recognition software, or just concentrate on making solar-powered backscratchers? Who knew that they needed Post-it notes or surgical stents or specialized rice planters until those things were actually developed? How do you make priorities when the priorities include things you cannot rationally value because you do not have them yet? How do you decide what to fund and when to fund it, what desires to trade off against each other? 4

The society you have founded normally relies on market signals to allocate resources. If a lot of people want petunias for their gardens, and are willing to pay handsomely for them, then some farmer who was formerly growing soybeans or gourds will devote a field to petunias instead. He will compete with the other petunia sellers to sell them to you. Voila! We do not need a state planner to consult the vegetable five-year plan and decree "Petunias for the People!" Instead, the decision about how to deploy society's productive resources is being made "automatically," cybernetically even, by rational individuals responding to price signals. And in a competitive market, you will get your petunias at very close to the cost of growing them and bringing them to market. Consumer desires are satisfied and productive resources are allocated efficiently. It's a tour de force. 5

Of course, there are problems. The market measures the value of a good by whether people have the ability and willingness to pay for it, so the whims of the rich may be more "valuable" than the needs of the destitute. We may spend more on pet psychiatry for the traumatized poodles on East 71st Street than on developing a cure for sleeping sickness, because the emotional wellbeing of the pets of the wealthy is "worth more" than the lives of the tropical world's poor. But for a lot of products, in a lot of areas, the market works—and that is a fact not to be taken for granted. 6

Why not use this mechanism to meet your cultural and innovation needs? If people need Madame Bovary or The New York Times or a new kind of antibiotic, surely the market will provide it? Apparently not. You have brought economists with you into your brave new world—perhaps out of nostalgia, or because a lot of packing got done at the last minute. The economists shake their heads.1 The petunia farmer is selling something that is "a rivalrous good." If I have the petunia, you can't have it. What's more, petunias are "excludable." The farmer only gives you petunias when you pay for them. It is these factors that make the petunia market work. What about Madame Bovary, or the antibiotic, or The New York Times? Well, it depends. If books have to be copied out by hand, then Madame Bovary is just like the petunia. But if thousands of copies of Madame Bovary can be printed on a printing press, or photocopied, or downloaded from www.flaubertsparrot.com, then the book becomes something that is nonrival; once Madame Bovary is written, it can satisfy many readers with little additional effort or cost. Indeed, depending on the technologies of reproduction, it may be very hard to exclude people from Madame Bovary. 7

Imagine a Napster for French literature; everyone could have Madame Bovary and only the first purchaser would have to pay for it. Because of these "nonrival" and "nonexcludable" characteristics, Flaubert's publisher would have a more difficult time coming up with a business plan than the petunia farmer. The same is true for the drug company that invests millions in screening and testing various drug candidates and ends up with a new antibiotic that is both safe and effective, but which can be copied for pennies. Who will invest the money, knowing that any product can be undercut by copies that don't have to pay the research costs? How are authors and publishers and drug manufacturers to make money? And if they can't make money, how are we to induce people to be authors or to be the investors who put money into the publishing or pharmaceutical business? 8

It is important to pause at this point and inquire how closely reality hews to the economic story of "nonexcludable" and "nonrival" public goods. It turns out that the reality is much more complex. First, there may be motivations for creation that do not depend on the market mechanism. People sometimes create because they seek fame, or out of altruism, or because an inherent creative force will not let them do otherwise. Where those motivations operate, we may not need a financial incentive to create. Thus the "problem" of cheap copying in fact becomes a virtue. Second, the same technologies that make copying cheaper may also lower the costs of advertising and distribution, cutting down on the need to finance expensive distribution chains. Third, even in situations that do require incentives for creativity and for distribution, it may be that being "first to market" with an innovation provides the innovator with enough of a head start on the competition to support the innovation.2 Fourth, while some aspects of the innovation may truly be nonrival, other aspects may not. Software is nonrival and hard to exclude people from, but it is easy to exclude your customers from the help line or technical support. The CD may be copied cheaply; the concert is easy to police. The innovator may even be advantaged by being able to trade on the likely effects of her innovation. If I know I have developed the digital camera, I may sell the conventional film company's shares short. Guarantees of authenticity, quality, and ease of use may attract purchasers even if unauthorized copying is theoretically cheaper. 9

In other words, the economic model of pure public goods will track our reality well in some areas and poorly in others—and the argument for state intervention to fix the problems of public goods will therefore wax and wane correspondingly. In the case of drug patents, for example, it is very strong. For lots of low-level business innovation, however, we believe that adequate incentives are provided by being first to market, and so we see no need to give monopoly power to the first business to come up with a new business plan—at least we did not until some disastrous patent law decisions discussed later in this book. Nor does a lowering of copying costs hurt every industry equally. Digital copies of music were a threat to the traditional music business, but digital copies of books? I am skeptical. This book will be freely and legally available online to all who wish to copy it. Both the publisher and I believe that this will increase rather than decrease sales. 10

Ignore these inconvenient complicating factors for a moment. Assume that wherever things are cheap to copy and hard to exclude others from, we have a potential collapse of the market. That book, that drug, that film will simply not be produced in the first place—unless the state steps in somehow to change the equation. This is the standard argument for intellectual property rights. And a very good argument it is. In order to solve the potentially "marketbreaking" problem of goods that are expensive to make and cheap to copy, we will use what my colleague Jerry Reichman calls the "market-making" device of intellectual property. The state will create a right to exclude others from the invention or the expression and confer it on the inventor or the author. The most familiar rights of this kind are copyrights and patents. (Trademarks present some special issues, which I will address a little later.) Having been given the ability to forbid people to copy your invention or your novel, you can make them pay for the privilege of getting access. You have been put back in the position of the petunia farmer. 11

Pause for a moment and think of what a brilliant social innovation this is—at least potentially. Focus not on the incentives alone, but on the decentralization of information processing and decision making that a market offers. Instead of having ministries of art that define the appropriate culture to be produced this year, or turning the entire path of national innovation policy over to the government, intellectual property decentralizes the choices about what creative and innovative paths to pursue while retaining the possibility that people will actually get paid for their innovation and creative expression.

1 12

The promise of copyright is this: if you are a radical environmentalist who wants to alert the world to the danger posed by climate change, or a passionate advocate of homeschooling, or a cartoonist with a uniquely twisted view of life, or a musician who can make a slack key guitar do very strange things, or a person who likes to take amazingly saccharine pictures of puppies and put them on greeting cards—maybe you can quit your day job and actually make a living from your expressive powers. If the market works, if the middlemen and distributors are smart enough, competitive enough, and willing to take a chance on expression that competes with their in-house talent, if you can make it somehow into the public consciousness, then you can be paid for allowing the world to copy, distribute, and perform your stuff. You risk your time and your effort and your passion and, if the market likes it, you will be rewarded. (At the very least, the giant producers of culture will be able to assemble vast teams of animators and musicians and software gurus and meld their labors into a videotape that will successfully anesthetize your children for two hours; no small accomplishment, let me tell you, and one for which people will certainly pay.) 13

More importantly, if the system works, the choices about the content of our culture—the mix of earnest essays and saccharine greeting cards and scantily clad singers and poetic renditions of Norse myths—will be decentralized to the people who actually read, or listen to, or watch the stuff. This is our cultural policy and it is driven, in part, by copyright. 14

The promise of patent is this: we have a multitude of human needs and a multitude of individuals and firms who might be able to satisfy those needs through innovation. Patent law offers us a decentralized system that, in principle, will allow individuals and firms to pick the problem that they wish to solve. Inventors and entrepreneurs can risk their time and their capital and, if they produce a solution that finds favor in the marketplace, will be able to reap the return provided by the legal right to exclude—by the legal monopoly over the resulting invention. The market hints at some unmet need—for drugs that might reduce obesity or cure multiple sclerosis, or for Post-it notes or windshield wipers that come on intermittently in light rain—and the innovator and her investors make a bet that they can meet that need. (Not all of these technologies will be patentable—only those that are novel and "nonobvious," something that goes beyond what any skilled person in the relevant field would have done.) 15

In return for the legal monopoly, patent holders must describe the technology well enough to allow anyone to replicate it once the patent term ends. Thus patent law allows us to avert two dangers: the danger that the innovation will languish because the inventor has no way to recover her investment of time and capital, and the danger that the inventor will turn to secrecy instead, hiding the details of her innovation behind black box technologies and restrictive contracts, so that society never gets the knowledge embedded in it. (This is a real danger. The medieval guilds often relied on secrecy to maintain the commercial advantage conveyed by their special skills, thus slowing progress down and sometimes simply stopping it. We still don't know how they made Stradivarius violins sound so good. Patents, by contrast, keep the knowledge public, at least in theory;3 you must describe it to own it.) And again, decisions about the direction of innovation have been largely, though not entirely, decentralized to the people who actually might use the products and services that result. This is our innovation policy and it is increasingly driven by patent. 16

What about the legal protection of trademarks, the little words or symbols or product shapes that identify products for us? Why do we have trademark law, this "homestead law for the English language"?4 Why not simply allow anyone to use any name or attractive symbol that they want on their products, even if someone else used it first? A trademark gives me a limited right to exclude other people from using my mark, or brand name, or product shape, just as copyright and patent law give me a limited right to exclude other people from my original expression or my novel invention. Why create such a right and back it with the force of law? 17

According to the economists, the answer is that trademark law does two things. It saves consumers time. We have good reason to believe that a soap that says "Ivory" or a tub of ice cream that says "Häagen-Dazs" will be made by the same manufacturer that made the last batch of Ivory soap or Häagen-Dazs ice cream. If we liked the good before and we see the symbol again, we know what we are getting. I can work out what kind of soap, ice cream, or car I like, and then just look for the appropriate sign rather than investigating the product all over again each time I buy. That would be wasteful and economists hate waste. At the same time, trademarks fulfill a second function: they are supposed to give manufacturers an incentive to make good products—or at least to make products of consistent quality or price—to build up a good brand name and invest in consistency of its key features, knowing that no other firm can take their name or symbol. (Why produce a high-quality product, or a reliable cheap product, and build a big market share if a free rider could wait until people liked the product and then just produce an imitation with the same name but of lower quality?) The promise of trademark is that quality and commercial information flow regulate themselves, with rational consumers judging among goods of consistent quality produced by manufacturers with an interest in building up long-term reputation. 18

So there we have the idealized vision of intellectual property. It is not merely supposed to produce incentives for innovation by rewarding creators, though that is vital. Intellectual property is also supposed to create a feedback mechanism that dictates the contours of information and innovation production. It is not an overstatement to say that intellectual property rights are designed to shape our information marketplace. Copyright law is supposed to give us a self-regulating cultural policy in which the right to exclude others from one's original expression fuels a vibrant public sphere indirectly driven by popular demand. At its best, it is supposed to allow a decentralized and iconoclastic cultural ferment in which independent artists, musicians, and writers can take their unique visions, histories, poems, or songs to the world—and make a living doing so if their work finds favor. Patent law is supposed to give us a self-regulating innovation policy in which the right to exclude others from novel and useful inventions creates a cybernetic and responsive innovation marketplace. The allocation of social resources to particular types of innovation is driven by guesses about what the market wants. Trademark law is supposed to give us a self-regulating commercial information policy in which the right to exclude others from one's trade name, symbol, or slogan produces a market for consumer information in which firms have incentives to establish quality brand names and consumers can rely on the meaning and the stability of the logos that surround them. Ivory soap will always mean Ivory soap and Coke will mean Coke, at least until the owners of those marks decide to change the nature of their products. 19

Some readers will find my use of the term "intellectual property" mistaken and offensive. They will argue, and I agree, that the use of the term "property" can cause people mistakenly to conflate these rights with those to physical property. (I outline that process and its negative consequences in the next chapter.) They will argue, and again I agree, that there are big differences between the three fields I have described. Should we not just list the specific rights about which we are speaking—copyright, patent, or trademark? Both of these concerns are real and well-founded, but I respectfully disagree with the conclusion that we should give up the term "intellectual property." 20

First, as I have tried to show above, while there are considerable differences between the three fields I discussed, there is also a core similarity—the attempt to use a legally created privilege to solve a potential "public goods problem." That similarity can enlighten as well as confuse. Yes, copyright looks very different from patent, just as a whale looks very different from a mouse. But we do not condemn the scientist who notes that they are both "mammals"—a socially constructed category—so long as he has a reason for focusing on that commonality. Second, the language of intellectual property exists. It has political reality in the world. Sometimes the language confuses and misleads. There are two possible reactions to such a reality. One can reject it and insist on a different and "purified" nomenclature, or one can attempt to point out the misperceptions and confusions using the very language in which they are embedded. I do not reject the first tactic. It can be useful. Here, though, I have embraced the second. 21

I have provided the idealized story of intellectual property. But is it true? Did the law really develop that way? Does it work that way now? Does this story still apply in the world of the Internet and the Human Genome Project? If you believed the idealized story, would you know what kind of intellectual property laws to write? The answer to all of these questions is "not exactly." 22

Like most social institutions, intellectual property has an altogether messier and more interesting history than this sanitized version of its functioning would suggest. The precursors of copyright law served to force the identification of the author, so that he could be punished if he proved to be a heretic or a revolutionary. The Statute of Anne—the first true copyright statute—was produced partly because of publishers' fights with booksellers; the authorial right grew as an afterthought.5 The history of patents includes a wealth of attempts to reward friends of the government and restrict or control dangerous technologies. Trademark law has shuttled uneasily between being a free-floating way to police competition so as to prohibit actions that courts thought were "unfair" and an absolute property right over an individual word or symbol. 23

But does intellectual property work this way now, promoting the ideal of progress, a transparent marketplace, easy and cheap access to information, decentralized and iconoclastic cultural production, self-correcting innovation policy? Often it does, but distressingly often it does the reverse. The rights that were supposed to be limited in time and scope to the minimum monopoly necessary to ensure production become instead a kind of perpetual corporate welfare—restraining the next generation of creators instead of encouraging them. The system that was supposed to harness the genius of both the market and democracy sometimes subverts both. Worse, it does so inefficiently, locking up vast swaths of culture in order to confer a benefit on a tiny minority of works. But this is too abstract. A single instance from copyright law will serve as a concrete example of what is at stake here. Later in the book I will give other examples. 24

YOU'LL GET MY LIBRARY OF CONGRESS WHEN . . . 25

Go to the Library of Congress catalogue. It is online at http://catalog.loc.gov/. This is an astounding repository of material—not just books and periodicals, but pictures, films, and music. The vast majority of this material, perhaps as much as 95 percent in the case of books, is commercially unavailable.6 The process happens comparatively quickly. Estimates suggest that a mere twenty-eight years after publication 85 percent of the works are no longer being commercially produced. (We know that when U.S. copyright required renewal after twenty-eight years, about 85 percent of all copyright holders did not bother to renew. This is a reasonable, if rough, guide to commercial viability.)7 26

Yet because the copyright term is now so long, in many cases extending well over a century, most of twentieth-century culture is still under copyright—copyrighted but unavailable. Much of this, in other words, is lost culture. No one is reprinting the books, screening the films, or playing the songs. No one is allowed to. In fact, we may not even know who holds the copyright. Companies have gone out of business. Records are incomplete or absent. In some cases, it is even more complicated. A film, for example, might have one copyright over the sound track, another over the movie footage, and another over the script. You get the idea. These works—which are commercially unavailable and also have no identifiable copyright holder—are called "orphan works." They make up a huge percentage of our great libraries' holdings. For example, scholars estimate that the majority of our film holdings are orphan works.8 For books, the estimates are similar. Not only are these works unavailable commercially, there is simply no way to find and contact the person who could agree to give permission to digitize the work or make it available in a new form. 27

Take a conservative set of numbers. Subtract from our totals the works that are clearly in the public domain. In the United States, that is generally work produced before 1923. That material, at least, we can use freely. Subtract, too, the works that are still available from the copyright holder. There we can gain access if we are willing to pay. Yet this still leaves a huge proportion of twentieth- and twenty-first-century culture commercially unavailable but under copyright. In the case of books, the number is over 95 percent, as I said before; with films and music, it is harder to tell, but the percentages are still tragically high. A substantial proportion of that total is made up of orphan works. They cannot be reprinted or digitized even if we were willing to pay the owner to do so. And then comes the Internet. Right now, you can search for those books or films or songs and have the location of the work instantly displayed, as well as a few details about it. And if you live in Washington, D.C., or near some other great library, you can go to a reading room, and if the work can be found and has not been checked out, and has not deteriorated, you can read the books (though you probably will not be able to arrange to see the movies unless you are an accredited film scholar). 28

I was searching the Library of Congress catalogue online one night, tracking down a seventy-year-old book about politics and markets, when my son came in to watch me. He was about eight years old at the time but already a child of the Internet age. He asked what I was doing and I explained that I was printing out the details of the book so that I could try to find it in my own university library. "Why don't you read it online?" he said, reaching over my shoulder and double-clicking on the title, frowning when that merely led to another information page: "How do you get to read the actual book?" I smiled at the assumption that all the works of literature were not merely in the Library of Congress, but actually on the Net: available to anyone with an Internet connection anywhere in the world—so that you could not merely search for, but also read or print, some large slice of the Library's holdings. Imagine what that would be like. Imagine the little underlined blue hyperlink from each title—to my son it made perfect sense. The book's title was in the catalogue. When you clicked the link, surely you would get to read it. That is what happened in his experience when one clicked a link. Why not here? It was an old book, after all, no longer in print. Imagine being able to read the books, hear the music, or watch the films—or at least the ones that the Library of Congress thought it worthwhile to digitize. Of course, that is ridiculous. 29

I tried to explain this to my son. I showed him that there were some works that could be seen online. I took him to the online photograph library, meaning to show him the wealth of amazing historical photographs. Instead, I found myself brooding over the lengthy listing of legal restrictions on the images and the explanation that reproduction of protected items may require the written permission of the copyright owners and that, in many cases, only indistinct and tiny thumbnail images are displayed to those searching from outside the Library of Congress "because of potential rights considerations." The same was true of the scratchy folk songs from the twenties or the early film holdings. The material was in the Library, of course—remarkable collections in some cases, carefully preserved, and sometimes even digitized at public expense. Yet only a tiny fraction of it is available online. (There is a fascinating set of Edison's early films, for example.) 30

Most of the material available online comes from so long ago that the copyright could not possibly still be in force. But since copyright lasts for seventy years after the death of the author (or ninety-five years if it was a corporate "work for hire"), that could be a very, very long time indeed. Long enough, in fact, to keep off limits almost the whole history of moving pictures and the entire history of recorded music. Long enough to lock up almost all of twentieth-century culture. 31

But is that not what copyright is supposed to do? To grant the right to restrict access, so as to allow authors to charge for the privilege of obtaining it? Yes, indeed. And this is a very good idea. But as I argue in this book, the goal of the system ought to be to give the monopoly only for as long as necessary to provide an incentive. After that, we should let the work fall into the public domain where all of us can use it, transform it, adapt it, build on it, republish it as we wish. For most works, the owners expect to make all the money they are going to recoup from the work with five or ten years of exclusive rights. The rest of the copyright term is of little use to them except as a kind of lottery ticket in case the work proves to be a one-in-a- million perennial favorite. The one-in-a-million lottery winner will benefit, of course, if his ticket comes up. And if the ticket is "free," who would not take it? But the ticket is not free to the public. They pay higher prices for the works still being commercially exploited and, frequently, the price of complete unavailability for the works that are not. 32

Think of a one-in-a-million perennial favorite—Harry Potter, say. Long after J. K. Rowling is dust, we will all be forbidden from making derivative works, or publishing cheap editions or large-type versions, or simply reproducing it for pleasure. I am a great admirer of Ms. Rowling's work, but my guess is that little extra incentive was provided by the thought that her copyright will endure seventy rather than merely fifty years after her death. Some large costs are being imposed here, for a small benefit. And the costs fall even more heavily on all the other works, which are available nowhere but in some moldering library stacks. To put it another way, if copyright owners had to purchase each additional five years of term separately, the same way we buy warranties on our appliances, the economically rational ones would mainly settle for a fairly short period. 33

Of course, there are some works that are still being exploited commercially long after their publication date. Obviously the owners of these works would not want them freely available online. This seems reasonable enough, though even with those works the copyright should expire eventually. But remember, in the Library of Congress's vast, wonderful pudding of songs and pictures and films and books and magazines and newspapers, there is perhaps a handful of raisins' worth of works that anyone is making any money from, and the vast majority of those come from the last ten years. If one goes back twenty years, perhaps a raisin. Fifty years? A slight raisiny aroma. We restrict access to the whole pudding in order to give the owners of the raisin slivers their due. But this pudding is almost all of twentieth- century culture, and we are restricting access to it when almost of all of it could be available. 34

If you do not know much about copyright, you might think that I am exaggerating. After all, if no one has any financial interest in the works or we do not even know who owns the copyright, surely a library would be free to put those works online? Doesn't "no harm, no foul" apply in the world of copyright? In a word, no. Copyright is what lawyers call a "strict liability" system. This means that it is generally not a legal excuse to say that you did not believe you were violating copyright, or that you did so by accident, or in the belief that no one would care, and that your actions benefited the public. Innocence and mistake do not absolve you, though they might reduce the penalties imposed. Since it is so difficult to know exactly who owns the copyright (or copyrights) on a work, many libraries simply will not reproduce the material or make it available online until they can be sure the copyright has expired—which may mean waiting for over a century. They cannot afford to take the risk. 35

What is wrong with this picture? Copyright has done its job and encouraged the creation of the work. But now it acts as a fence, keeping us out and restricting access to the work to those who have the time and resources to trudge through the stacks of the nation's archives. In some cases, as with film, it may simply make the work completely unavailable. 36

So far I have been talking as though copyright were the only reason the material is not freely available online. But of course, this is not true. Digitizing costs money (though less every year) and there is a lot of rubbish out there, stuff no one would ever want to make available digitally (though it must be noted that one man's rubbish is another man's delight). But that still leaves vast amounts of material that we would want, and be willing to pay, to have digitized. Remember also that if the material were legally free, anyone could get in on the act of digitizing it and putting it up. Google's much-heralded effort to scan the books in major libraries is just the kind of thing I mean. But Google is being sued for violating copyright—even though it allows any author to "opt out" of its system, and even though under the Google system you cannot click to get the book if it is still under copyright, merely a snippet a few sentences long from the book. 37

If you are shaking your head as you read this, saying that no one would bother digitizing most of the material in the archives, look at the Internet and ask yourself where the information came from the last time you did a search. Was it an official and prestigious institution? A university or a museum or a government? Sometimes those are our sources of information, of course. But do you not find the majority of the information you need by wandering off into a strange click-trail of sites, amateur and professional, commercial and not, hobbyist and entrepreneur, all self-organized by internal referrals and search engine algorithms? Even if Google did not undertake the task of digitization, there would be hundreds, thousands, maybe millions of others who would—not with Google's resources, to be sure. In the process, they would create something quite remarkable. 38

The most satisfying proofs are existence proofs. A platypus is an existence proof that mammals can lay eggs. The Internet is an existence proof of the remarkable information processing power of a decentralized network of hobbyists, amateurs, universities, businesses, volunteer groups, professionals, and retired experts and who knows what else. It is a network that produces useful information and services. Frequently, it does so at no cost to the user and without anyone guiding it. Imagine that energy, that decentralized and idiosyncratically dispersed pattern of interests, turned loose on the cultural artifacts of the twentieth century. Then imagine it coupled to the efforts of the great state archives and private museums who themselves would be free to do the same thing. Think of the people who would work on Buster Keaton, or the literary classics of the 1930s, or the films of the Second World War, or footage on the daily lives of African-Americans during segregation, or the music of the Great Depression, or theremin recordings, or the best of vaudeville. Imagine your Google search in such a world. Imagine that Library of Congress. One science fiction writer has taken a stab. His character utters the immortal line, "Man, you'll get my Library of Congress when you pry my cold dead fingers off it!" 9 39

Familiar with the effect of this kind of train of thought on his father, my son had long since wandered off in search of a basketball game to watch. But I have to admit his question was something of an epiphany for me: Where do you click to get the actual book? 40

The response I get from a lot of people is that this vision of the Library of Congress is communism, pure and simple. Such people view Google's attempt to digitize books as simple theft. Surely it will destroy the incentives necessary to produce the next beach novel, the next academic monograph, the next teen band CD, the next hundred-million-dollar movie? But this mistakes my suggestion. Imagine a very conservative system. First, let us make people demonstrate that they want a copyright, by the arduous step of actually writing the word copyright or the little (C) on the work. (At the moment, everyone gets a copyright as soon as the work is written down or otherwise fixed, whether they want one or not.) But how long a copyright? We know that the majority of works are only valuable for five or ten years. Let us give copyright owners more than double that, say twenty-eight years of exclusive rights. If prior experience is any guide, 85 percent of works will be allowed to enter the public domain after that period. If that isn't generous enough, let us say that the small proportion of owners who still find value in their copyright at the end of twenty-eight years can extend their copyright for another twenty-eight years. Works that are not renewed fall immediately into the public domain. If you check the register after twenty- eight years and the work has not been renewed, it is in the public domain. Works that are renewed get the extra time. 41

Now this is a conservative suggestion, too conservative in my view, though still better than what we have now. Is it feasible? It would be hard to argue that it is not. This pretty much was the law in the United States until 1978. (My system is a little simpler, but the broad strokes are the same.) Since that point, in two broad stages, we have moved away from this system at the very moment in history when the Internet made it a particularly stupid idea to do so. 42

How have we changed the system? We have given copyrights to the creator of any original work as soon as it is fixed, so that you, reader, are the author of thousands of copyrighted works. Almost everything up on the Internet is copyrighted, even if its creators do not know that and would prefer it to be in the public domain. Imagine that you want to make a documentary and use a film clip that a student filmmaker has put up on his home page. Perhaps you want to adapt the nifty graphics that a high school teacher in Hawaii created to teach her calculus class, thinking that, with a few changes, you could use the material for your state's K-12 physics program. Perhaps you are a collage artist who wishes to incorporate images that amateur artists have put online. None of the works are marked by a copyright symbol. Certainly they are up on the Internet, but does that mean that they are available for reprinting, adaptation, or incorporation in a new work? 43

In each of these cases, you simply do not know whether what you are doing is legal or not. Of course, you can take the risk, though that becomes less advisable if you want to share your work with others. Each broadening of the circle of sharing increases the value to society but also the legal danger to you. What if you want to put the course materials on the Net, or publish the anthology, or display the movie? Perhaps you can try to persuade your publisher or employer or distributor to take the risk. Perhaps you can track down the authors of every piece you wish to use and puzzle through the way to get a legal release from them stating that they give you permission to use the work they did not even know they had copyright over. Or you can give up. Whatever happens, you waste time and effort in trying to figure out a way of getting around a system that is designed around neither your needs nor the needs of many of the people whose work you want to use. 44

Apart from doing away with the need to indicate that you want your works to be copyrighted, we have lengthened the copyright term. We did this without any credible evidence that it was necessary to encourage innovation. We have extended the terms of living and even of dead authors over works that have already been created. (It is hard to argue that this was a necessary incentive, what with the works already existing and the authors often being dead.) We have done away with the need to renew the right. Everyone gets the term of life plus seventy years, or ninety-five years for corporate "works for hire." All protected by a "strict liability" system with scary penalties. And, as I said before, we have made all those choices just when the Internet makes their costs particularly tragic. 45

In sum, we have forgone the Library of Congress I described without even apparently realizing we were doing so. We have locked up most of twentieth-century culture and done it in a particularly inefficient and senseless way, creating vast costs in order to convey proportionally tiny benefits. (And all without much complaint from those who normally object to inefficient government subsidy programs.) Worst of all, we have turned the system on its head. Copyright, intended to be the servant of creativity, a means of promoting access to information, is becoming an obstacle to both. 46

That, then, is one example of the stakes of the debate over intellectual property policy. Unfortunately, the problem of copyright terms is just one example, one instance of a larger pattern. As I will try to show, this pattern is repeated again and again in patents, in trademarks, and elsewhere in copyright law. This is not an isolated "glitch." It is a complicated but relentless tendency that has led to a hypertrophy of intellectual property rights and an assault on the public domain. In fact, in many cases, the reality is even worse: there appears to be a complete ignorance about the value of the public domain. Property's opposite, its outside, is getting short shrift. 47

To paraphrase a song from my youth, "how did we get here?" Where should we turn to understand the role of intellectual property in the era of the Internet and the decoding of the human genome? We could turn to the cutting edge of technology or to economics or information theory. But none of those would be as useful a starting place as a letter that was written about two hundred years ago, using a high-tech quill pen, about a subject far from the digital world.

Chapter 2: Thomas Jefferson Writes a Letter 1

On August 13, 1813, Thomas Jefferson took up his pen to write to Isaac McPherson.1 It was a quiet week in Jefferson's correspondence. He wrote a letter to Madison about the appointment of a tax assessor, attempted to procure a government position for an acquaintance, produced a fascinating and lengthy series of comments on a new "Rudiments of English Grammar," discussed the orthography of nouns ending in "y," accepted the necessary delay in the publication of a study on the anatomy of mammoth bones, completed a brief biography of Governor Lewis, and, in general, confined himself narrowly in subject matter.2 But on the 13th of August, Jefferson's mind was on intellectual property, and most specifically, patents. 2

Jefferson's writing is, as usual, apparently effortless. Some find his penmanship a little hard to decipher. To me, used to plowing through the frenzied chicken tracks that law students produce during exams, it seems perfectly clear. If handwriting truly showed the architecture of the soul, then Jefferson's would conjure up Monticello or the University of Virginia. There are a few revisions and interlineations, a couple of words squeezed in with a caret at the bottom of the line, but for the most part the lines of handwriting simply roll on and on—"the fugitive fermentation of an individual brain,"3 to quote a phrase from the letter, caught in vellum and ink, though that brain has been dust for more than a century and a half. 3

I love libraries. I love the mushroom smell of gently rotting paper, the flaky crackle of manuscripts, and the surprise of matching style of handwriting with style of thought. Today, though, I am viewing his letter over the Internet on a computer screen. (You can too. The details are at the back of the book.) 4

I think Jefferson would have been fascinated by the Internet. After all, this was the man whose library became the Library of Congress,4 who exemplifies the notion of the brilliant dabbler in a hundred fields, whose own book collection was clearly a vital and much consulted part of his daily existence, and whose vision of politics celebrates the power of an informed citizenry. Admittedly, the massive conflicts between Jefferson's announced principles and his actions on the issue of slavery have led some, though not me, to doubt that there is any sincerity or moral instruction to be found in his words.5 But even those who find him a sham can hardly fail to see the continual and obvious joy he felt about knowledge and its spread. 5

In the letter to Isaac McPherson, a letter that has become very famous in the world of the digerati,6 this joy becomes manifest. The initial subject of the correspondence seems far from the online world. McPherson wrote to Jefferson about "elevators, conveyers and Hopper-boys." Specifically, he wanted to know Jefferson's opinion of a patent that had been issued to Mr. Oliver Evans. Jefferson devotes a paragraph to a recent retrospective extension of patent rights (he disapproves) and then turns to Evans's elevators. 6

Patents then, as now, were only supposed to be given for inventions that were novel, nonobvious, and useful. Jefferson had considerable doubt whether Evans's device, essentially a revolving string of buckets used to move grain, actually counted as "an invention." "The question then whether such a string of buckets was invented first by Oliver Evans, is a mere question of fact in mathematical history. Now, turning to such books only as I happen to possess, I find abundant proof that this simple machinery has been in use from time immemorial." Jefferson cites from his library example after example of references to the "Persian wheel"—a string of buckets to move water. The display of scholarship is effortless and without artifice. If the device existed to move water, he declares, Mr. Evans can hardly patent it to move grain. "If one person invents a knife convenient for pointing our pens, another cannot have a patent right for the same knife to point our pencils. A compass was invented for navigating the sea; another could not have a patent right for using it to survey land."7 7

So far as we can tell, this was the only part of the letter that interested McPherson. Later correspondence indicates that he had a pamphlet printed questioning the patent.8 But while it is impressive to see Jefferson's easy command of historical evidence or his grasp of the importance of limiting the subject matter, scope, and duration of patents, these qualities alone would not have given the letter the fame it now has. It is when Jefferson turns to the idea of intellectual property itself that the letter becomes more than a historical curiosity. In a couple of pages, quickly jotted down on a humid August day in 1813, he frames the issue as well as anyone has since. 8

He starts by dismissing the idea "that inventors have a natural and exclusive right to their inventions, and not merely for their own lives, but inheritable to their heirs." In lines that will sound strange to those who assume that the framers of the Constitution were property absolutists, Jefferson argues that "stable ownership" of even tangible property is "a gift of social law." Intellectual property, then, has still less of a claim to some permanent, absolute, and natural status. 9

[W]hile it is a moot question whether the origin of any kind of property is derived from nature at all, it would be singular to admit a natural and even an hereditary right to inventors. It is agreed by those who have seriously considered the subject, that no individual has, of natural right, a separate property in an acre of land, for instance. By an universal law, indeed, whatever, whether fixed or movable, belongs to all men equally and in common, is the property for the moment of him who occupies it, but when he relinquishes the occupation, the property goes with it. Stable ownership is the gift of social law, and is given late in the progress of society. It would be curious then, if an idea, the fugitive fermentation of an individual brain, could, of natural right, be claimed in exclusive and stable property.9 10

Jefferson's point here may seem obscure to us. We are not used to starting every argument from first principles. But it is in fact quite simple. It is society that creates property rights that go beyond mere occupancy. It does so for several reasons—reasons of both practicality and natural justice. (Elsewhere in his writings, Jefferson expands on this point at greater length.) One of those reasons has to do with the difficulty, perhaps even the impossibility, of two different people having full and unfettered ownership of the same piece of property simultaneously. Another linked reason comes from the practicality of excluding others from our property, so that we can exploit it secure from the plunder or sloth of others. The economists you encountered in Chapter 1 have, with their usual linguistic felicity, coined the terms "rivalrous" and "excludable" to describe these characteristics. 11

With rivalrous property, one person's use precludes another's. If I drink the milk, you cannot. Excludable property is, logically enough, property from which others can easily be excluded or kept out. But ideas seem to have neither of these characteristics. 12

If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of every one, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possess the less, because every other possess the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density in any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property.10 13

Those who quote the passage sometimes stop here, which is a shame, because it leaves the impression that Jefferson was unequivocally against intellectual property rights. But that would be a considerable overstatement. When he says that inventions can never be the subject of property, he means a permanent and exclusive property right which, as a matter of natural right, no just government could abridge. However, inventions could be covered by temporary state-created monopolies instituted for the common good. In the lines immediately following the popularly quoted excerpt, Jefferson goes on: 14

Society may give an exclusive right to the profits arising from [inventions], as an encouragement to men to pursue ideas which may produce utility, but this may or may not be done, according to the will and convenience of the society, without claim or complaint from any body. Accordingly, it is a fact, as far as I am informed, that England was, until we copied her, the only country on earth which ever, by a general law, gave a legal right to the exclusive use of an idea. In some other countries it is sometimes done, in a great case, and by a special and personal act, but, generally speaking, other nations have thought that these monopolies produce more embarrassment than advantage to society; and it may be observed that the nations which refuse monopolies of invention, are as fruitful as England in new and useful devices.11 15

Jefferson's message was a skeptical recognition that intellectual property rights might be necessary, a careful explanation that they should not be treated as natural rights, and a warning of the monopolistic dangers that they pose. He immediately goes on to say something else, something that is, if anything, more true in the world of patents on Internet business methods and gene sequences than it was in the world of "conveyers and Hopper-boys." 16

Considering the exclusive right to invention as given not of natural right, but for the benefit of society, I know well the difficulty of drawing a line between the things which are worth to the public the embarrassment of an exclusive patent, and those which are not.12

17

So Jefferson gives us a classic set of cautions, cautions that we should be required to repeat, as police officers repeat the Miranda Warning to a suspect. In this case, they should be repeated before we rush off into the world of intellectual property policy rather than before we talk to the police without our lawyers present. 18

THE JEFFERSON WARNING 19

Like the Miranda Warning, the Jefferson Warning has a number of important parts. 20

* First, the stuff we cover with intellectual property rights has certain vital differences from the stuff we cover with tangible property rights. Partly because of those differences, Jefferson, like most of his successors in the United States, does not see intellectual property as a claim of natural right based on expended labor. Instead it is a temporary state-created monopoly given to encourage further innovation. * Second, there is no "entitlement" to have an intellectual property right. Such rights may or may not be given as a matter of social "will and convenience" without "claim or complaint from any body." * Third, intellectual property rights are not and should not be permanent; in fact they should be tightly limited in time and should not last a day longer than necessary to encourage the innovation in the first place. * Fourth, a linked point, they have considerable monopolistic dangers—they may well produce more "embarrassment than advantage." In fact, since intellectual property rights potentially restrain the benevolent tendency of "ideas . . . [to] freely spread from one to another over the globe, for the moral and mutual instruction of man," they may in some cases actually hinder rather than encourage innovation. * Fifth, deciding whether to have an intellectual property system is only the first choice in a long series.13 Even if one believes that intellectual property is a good idea, which I firmly do, one will still have the hard job of saying which types of innovation or information are "worth to the public the embarrassment" of an exclusive right, and of drawing the limits of that right. This line-drawing task turns out to be very difficult. Without the cautions that Jefferson gave us it is impossible to do it well. 21

Jefferson's message was famously echoed and amplified thirty years later in Britain by Thomas Babington Macaulay.14 Macaulay's speeches to the House of Commons in 1841 on the subject of copyright term extension still express better than anything else the position that intellectual property rights are necessary evils which must be carefully circumscribed by law. In order for the supply of valuable books to be maintained, authors "must be remunerated for their literary labour. And there are only two ways in which they can be remunerated. One of those ways is patronage; the other is copyright." Patronage is rejected out of hand. "I can conceive no system more fatal to the integrity and independence of literary men than one under which they should be taught to look for their daily bread to the favour of ministers and nobles."15 22

We have, then, only one resource left. We must betake ourselves to copyright, be the inconveniences of copyright what they may. Those inconveniences, in truth, are neither few nor small. Copyright is monopoly, and produces all the effects which the general voice of mankind attributes to monopoly. . . . I believe, Sir, that I may safely take it for granted that the effect of monopoly generally is to make articles scarce, to make them dear, and to make them bad. And I may with equal safety challenge my honorable friend to find out any distinction between copyright and other privileges of the same kind; any reason why a monopoly of books should produce an effect directly the reverse of that which was produced by the East India Company's monopoly of tea, or by Lord Essex's monopoly of sweet wines. Thus, then, stands the case. It is good that authors should be remunerated; and the least exceptionable way of remunerating them is by a monopoly. Yet monopoly is an evil. For the sake of the good we must submit to the evil; but the evil ought not to last a day longer than is necessary for the purpose of securing the good.16 23

Notice that it is the monopolistic quality of intellectual property that really disturbs Macaulay. His was a generation of thinkers for whom the negative effect of monopolies of any kind (and state-granted monopolies in particular) was axiomatic. He becomes almost contemptuous when one of the supporters of copyright extension declared that it was merely "a theory" that monopoly makes things expensive. Macaulay agrees, tongue in cheek. "It is a theory in the same sense in which it is a theory, that day and night follow each other, that lead is heavier than water, that bread nourishes, that arsenic poisons, that alcohol intoxicates."17 24

These words from Jefferson and Macaulay encapsulate an eighteenth- and nineteenth-century free-trade skepticism about intellectual property, a skepticism that is widely, but not universally, believed to have played an important role in shaping the history of intellectual property in both the United States and the United Kingdom. Certainly the U.S. Supreme Court has offered support for that position,18 and, with one significant recent exception,19 historians of intellectual property have agreed.20 Jefferson himself had believed that the Constitution should have definite limits on both the term and the scope of intellectual property rights.21 James Madison stressed the costs of any intellectual property right and the need to limit its term and to allow the government to end the monopoly by compulsory purchase if necessary.22 Adam Smith expressed similar views. Monopolies that carry on long after they were needed to encourage some socially beneficial activity, he said, tax every other citizen "very absurdly in two different ways: first, by the high price of goods, which, in the case of a free trade, they could buy much cheaper; and, secondly, by their total exclusion from a branch of business which it might be both convenient and profitable for many of them to carry on."23 25

It is important to note, though, that the eighteenth- and nineteenth-century writers I have quoted were not against intellectual property. All of them—Jefferson, Madison, Smith, and Macaulay—could see good reason why intellectual property rights should be granted. They simply insisted on weighing the costs and benefits of a new right, each expansion of scope, each lengthening of the copyright term. Here is Macaulay again, waxing eloquently sarcastic about the costs and benefits of extending the copyright term so that it would last many years after the author's death: 26

I will take an example. Dr. Johnson died fifty-six years ago. If the law were what my honourable and learned friend wishes to make it, somebody would now have the monopoly of Dr. Johnson's works. Who that somebody would be it is impossible to say; but we may venture to guess. I guess, then, that it would have been some bookseller, who was the assign of another bookseller, who was the grandson of a third bookseller, who had bought the copyright from Black Frank, the Doctor's servant and residuary legatee, in 1785 or 1786. Now, would the knowledge that this copyright would exist in 1841 have been a source of gratification to Johnson? Would it have stimulated his exertions? Would it have once drawn him out of his bed before noon? Would it have once cheered him under a fit of the spleen? Would it have induced him to give us one more allegory, one more life of a poet, one more imitation of Juvenal? I firmly believe not. I firmly believe that a hundred years ago, when he was writing our debates for the Gentleman's Magazine, he would very much rather have had twopence to buy a plate of shin of beef at a cook's shop underground.24 27

Again, I am struck by how seamlessly Macaulay coupled beautiful, evocative writing and careful, analytic argument. Admittedly, he was remarkable even in his own time, but it is hard to imagine a contemporary speechwriter, let alone a politician, coming up with Dr. Johnson "cheered . . . under a fit of the spleen" or buying a "plate of shin of beef at a cook's shop underground." Almost as hard as it is to imagine any of them engaging in Jefferson's correspondence about mammoth bones, orthography, and the practicalities of the nautical torpedo. But I digress. 28

Macaulay is not against using a lengthened copyright term to give an extra reward to writers, even if this would dramatically raise the price of books. What he objects to is dramatically raising the price of books written by long-dead authors in a way that benefits the authors hardly at all. 29

Considered as a reward to him, the difference between a twenty years' and a sixty years' term of posthumous copyright would have been nothing or next to nothing. But is the difference nothing to us? I can buy Rasselas for sixpence; I might have had to give five shillings for it. I can buy the Dictionary, the entire genuine Dictionary, for two guineas, perhaps for less; I might have had to give five or six guineas for it. Do I grudge this to a man like Dr. Johnson? Not at all. Show me that the prospect of this boon roused him to any vigorous effort, or sustained his spirits under depressing circumstances, and I am quite willing to pay the price of such an object, heavy as that price is. But what I do complain of is that my circumstances are to be worse, and Johnson's none the better; that I am to give five pounds for what to him was not worth a farthing.25 30

Though Macaulay won the debate over copyright term extension, it is worth noting here that his opponents triumphed in the end. As I pointed out in the last chapter, the copyright term in most of Europe and in the United States now lasts for the life of the author and an additional seventy years afterward, ten years more than the proposal which made Macaulay so indignant. In the United States, corporate owners of "works-for-hire" get ninety- five years.26 The Supreme Court recently heard a constitutional challenge to the law which expanded the term of copyrights by twenty years to reach this remarkable length.27 (Full disclosure: I helped prepare an amicus brief in that case.)28 This law, the Sonny Bono Copyright Term Extension Act, also extended existing copyrights over works which had already been created.29 As I observed earlier, this is particularly remarkable if the idea is to give an incentive to create. Obviously the authors of existing works were given sufficient incentive to create; we know that because they did. Why do we need to give the people who now hold their copyrights another twenty years of monopoly? This is all cost and no benefit. Macaulay would have been furious. 31

When the Supreme Court heard the case, it was presented with a remarkable friend-of-the-court brief from seventeen economists, several of them Nobel laureates.30 The economists made exactly Macaulay's argument, though in less graceful language. They pointed out that copyright extension imposed enormous costs on the public and yet conveyed tiny advantages, if any, to the creator. Such an extension, particularly over works that had already been written, hardly fit the limits of Congress's power under the Constitution "to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries."31 Macaulay doubted that these enormously long terms would encourage the living. Surely they would do little to encourage the dead, while imposing considerable costs of access on the living? Thus they could hardly be said to "promote the progress" of knowledge as the Constitution requires. The Court was unmoved by this and other arguments. It upheld the law. I will return to its decision at the end of the book. 32

The intellectual property skeptics had other concerns. Macaulay was particularly worried about the power that went with a transferable and inheritable monopoly. It is not only that the effect of monopoly is "to make articles scarce, to make them dear, and to make them bad." Macaulay also pointed out that those who controlled the monopoly, particularly after the death of the original author, might be given too great a control over our collective culture. Censorious heirs or purchasers of the copyright might prevent the reprinting of a great work because they disagreed with its morals.32 We might lose the works of Fielding or Gibbon, because a legatee found them distasteful and used the power of the copyright to suppress them. This is no mere fantasy, Macaulay tells us. After praising the novels of Samuel Richardson in terms that, to modern eyes, seem a little fervid ("No writings, those of Shakespeare excepted, show more profound knowledge of the human heart"), Macaulay recounts the story of Richardson's grandson, "a clergyman in the city of London." Though a "most upright and excellent man," the grandson "had conceived a strong prejudice against works of fiction," "thought all novel-reading not only frivolous but sinful," and "had never thought it right to read one of his grandfather's books."33 Extended copyright terms might hand over the copyright to such a man. The public would lose, not because they had to pay exorbitant prices that denied some access to the work, but because the work would be altogether suppressed. Richardson's novels—Pamela, Clarissa Harlowe, and so on—are now the preserve of the classroom rather than the drawing room, so this might not seem like much of a loss. But Macaulay's next example is not so easy to dismiss. 33

One of the most instructive, interesting, and delightful books in our language is Boswell's Life of Johnson. Now it is well known that Boswell's eldest son considered this book, considered the whole relation of Boswell to Johnson, as a blot in the escutcheon of the family. He thought, not perhaps altogether without reason, that his father had exhibited himself in a ludicrous and degrading light. And thus he became so sore and irritable that at last he could not bear to hear the Life of Johnson mentioned. Suppose that the law had been what my honourable and learned friend wishes to make it. Suppose that the copyright of Boswell's Life of Johnson had belonged, as it well might, during sixty years, to Boswell's eldest son. What would have been the consequence? An unadulterated copy of the finest biographical work in the world would have been as scarce as the first edition of Camden's Britannia.34 34

From more recent examples we can see that outright suppression is not the only thing to fear. The authors' heirs, or the corporations which have purchased their rights, may keep policing the boundaries of the work long after the original author is dead. In 2001, Alice Randall published The Wind Done Gone. As its title might indicate, The Wind Done Gone was a 220- page "critique of and reaction to" the world of Gone With the Wind by Margaret Mitchell.35 Most crucially, perhaps, it was a version of Gone With the Wind told from the slaves' point of view. Suddenly the actions of Rhett ("R"), Scarlett ("Other"), and an obviously gay Ashley ("Dreamy Gentleman") come into new perspective through the eyes of Scarlett's "mulatto" half- sister. Mitchell's estate wanted to prevent publication of the book. At first they were successful.36 As Yochai Benkler puts it, 35

Alice Randall, an African American woman, was ordered by a government official not to publish her criticism of the romanticization of the Old South, at least not in the words she wanted to use. The official was not one of the many in Congress and the Administration who share the romantic view of the Confederacy. It was a federal judge in Atlanta who told Randall that she could not write her critique in the words she wanted to use—a judge enforcing copyright law.37 36

"They killed Miss Scarlett!" the astonished trial judge said after reading Randall's book. My colleague Jennifer Jenkins, one of the lawyers in the case, recounts that the judge saw the case in relentlessly physical terms, seeing the parody as a "bulldozer" and Gone With the Wind as a walled country estate into which the bulldozer had violently trespassed. He was consequently unimpressed with the claim that this "bulldozer" was protected by the First Amendment. Eventually, the court of appeals overturned the district court's judgment.38 Fifty-two years after Margaret Mitchell's death, it was a hotly debated point how much leeway copyright gave to others to comment upon, critique, embellish upon, and parody the cultural icon she had conjured up. 37

A NATURAL RIGHT? 38

To some people, my argument so far—and Jefferson's and Macaulay's—will seem to miss the point. They see intellectual property rights not as an incentive, a method of encouraging the production and distribution of innovation, but as a natural or moral right. My book is mine because I wrote it, not because society or the law gives me some period of exclusivity over allowing the copying of its contents. My invention is mine because it came from my brain, not because the law declares a twenty-year monopoly over its production or distribution. My logo is mine because I worked hard on it, not because the state grants me a trademark in order to lower search costs and prevent consumer confusion. One answer is simply to say "In the United States, the framers of the Constitution, the legislature, and the courts have chosen to arrange things otherwise. In copyright, patent, and trademark law—despite occasional deviations—they have embraced the utilitarian view instead." 39

Broadly speaking, that answer is correct.39 It also holds, to a lesser extent, in Britain. Even in the droits d'auteur countries, which have a markedly different copyright law regime, it largely holds for their patent and trademark law systems, and utilitarian strands suffuse even "the sacred rights of authors." So, on a national level, we have rejected or dramatically limited the natural rights view, and on an international level, we have rejected it in "industrial property"—patent and trademark—and modified it in copyright. 40

I think this answer is correct and important, but we have an obligation to go further. Partly that is because intuitions about ownership coming naturally with labor or discovery continue to influence the law. Partly it is because those moral intuitions are important and appealing. Partly it is because we might wish to modify or criticize our current system. Using the views of the framers, or current law, to preempt discussion is unsatisfactory—even though those views are of particular importance for the legal policy decisions we face in the short run, the issues on which much of my argument is concentrated. 41

There are varying stated grounds for natural or moral rights in intellectual creations. Some people may think the book is mine because I worked on it—a Lockean conception where I mix my sweat with these words and receive a property right in the process. 42

For all its attractions, there are considerable difficulties with such a view. Even within the world of tangible property, Locke's theory is more complicated than a simple equation of labor with property right. Jefferson's account of property is actually closer to Locke's than many would realize. When Jefferson points out the difficulty in justifying a natural right even in an acre of land, let alone a book, his premises are not radically different from Locke's. The same is true when Jefferson says that "table ownership is the gift of social law, and is given late in the progress of society." Even if natural right does create the ground for the property claim, it is "social law" that shapes its contours and guarantees its stability. Jefferson, of course, thought that was particularly true for intellectual property rights. In that context, he felt the natural rights argument was much weaker and the need for socially defined purposive contours and limitations stronger. 43

Locke's own views on what we would think of as copyright are hard to determine. We do know that he had a strong antipathy to monopolies—particularly those affecting expression. He believed, for example, that giving publishers monopolies over great public domain books caused a disastrous fall in quality. Instead, he argued, such books should be open for all to compete to produce the best edition. Of course, he was writing in the context of monopolistic printing privileges—to which he was strongly opposed—rather than of individual authorial rights. Yet he went further and suggested that even for contemporary works, after a particular time in print—say fifty years—books could be printed by anyone. 44

I demand whether, if another act for printing should be made, it be not reasonable that nobody should have any peculiar right in any book which has been in print fifty years, but any one as well as another might have liberty to print it: for by such titles as these, which lie dormant, and hinder others, many good books come quite to be lost.40 45

This sounds like a strongly utilitarian argument, rather than one based on labor and natural right. Of course, we are not bound by what Locke or Jefferson thought. Still it is striking to see the turn to a utilitarian conception from both of them. 46

The Lockean tradition is not the only one, of course. Others believe that the property right stems from the unique personality of each individual—the configurations of your individual genius made manifest in the lines of your sonnet. (Some limit the natural right to literary and expressive work; can a mousetrap or a drug molecule express the riddle and wonder of the human spirit?) Whatever their moral basis or their ambit, the common ground between these positions is the belief in a rationale for intellectual property rights beyond the utilitarian concerns of Jefferson or Macaulay. 47

The norms embodied in the moral rights or natural rights tradition are deeply attractive—at least to me. Many of us feel a special connection to our expressive creations—even the humble ones such as a term paper or a birthday poem. It is one of the reasons that the central moral rights in the French droits d'auteur, or author's rights, tradition resonate so strongly with us. The entitlement of an author to be correctly attributed, to have some control over the integrity of his work, seems important regardless of its utilitarian functions.1 48

Yet even as we find this claim attractive, we become aware of the need to find limiting principles to it. It gives us pause to think that Margaret Mitchell or her heirs could forbid someone parodying her work. Are there no free-speech limitations? When other forms of authorship, such as computer programs, are brought into copyright's domain, does the power of the moral right decrease, while the need to limit its scope intensifies? 49

Then there is the question of length. How long is a natural right in expression or invention supposed to last? It seems absurd to imagine that Shakespeare's or Mozart's heirs, or those who had bought their copyrights, would still be controlling the performance, reproduction, and interpretation of their works hundreds of years after their death. If the rights are truly formed for a nonutilitarian purpose, after all, why should they expire? The person who first acquires property rights in land by work or conquest passes those rights down to heirs and buyers with the chain of transmission reaching to the present day. Should copyright follow suit? Even in France, the home of the strongest form of the droits d'auteur and of the "moral rights" tradition, the answer to this question was in the negative. 50

We owe a large part of the literary moral rights tradition to the immediate aftermath of the French Revolution. In France before the Revolution, as in England before the Statute of Anne, the first true copyright legislation, the regulation of publishing was through a set of "privileges" given to printers, not rights given to authors. Publishers would have a guild- enforced monopoly over certain titles. Their right was against competing publishers printing the list of titles over which they had the privilege. The Revolution abolished these privileges and, at first, put nothing in their place. On the other hand, as Carla Hesse's fascinating work reveals, there was intermittent interference by the Prefecture of Police with those who copied most flagrantly. One such publisher was sternly instructed by the police in these terms: 51

[A]ccording to the Declaration of the Rights of Man, liberty means only the freedom to do what does not harm others; and that it harms others to appropriate the work of an author, because it is an infringement of the sacred right of property; and that such an enterprise, if it were to remain unpunished, would deprive citizens of the instruction they await from celebrated authors like M. Bernardin de St. Pierre, because no author would want to consecrate his labors to the instruction of his age if piracy were ever authorized.41 52

Note the interesting mixture of the language of the "sacred rights of property" and the strong utilitarian justification which cites effects on future literary production and the "instruction" of citizens. 53

More expansive conceptions of the rights of authors and, particularly, of publishers were also offered. Even before the Revolution, publishers had been making the arguments that their privileges were a form of property rights and had the very good sense to hire the young Diderot to make those arguments. Hesse quotes his words: 54

What form of wealth could belong to a man, if not a work of the mind, . . . if not his own thoughts, . . . the most precious part of himself, that will never perish, that will immortalize him? What comparison could there be between a man, the very substance of man, his soul, and a field, a tree, a vine, that nature has offered in the beginning equally to all, and that an individual has only appropriated through cultivating it?42 55

Diderot's theme is that authors' rights should actually be stronger than other property rights for two reasons. First, they relate to the very essence of the person, the most "precious part of himself." Second, they are the only property rights over something that has been added to the existing store of wealth rather than taken from it. Authorial property, unlike property in land, adds to the common store rather than detracting from it. Locke believed that a just assertion of property rights must leave "enough and as good" for others in the society. What could better satisfy this condition than a property right over a novel that did not exist before I wrote it? One hundred years later Victor Hugo echoed the same thoughts in a speech to the Conseil d'Etat and pointed out at the same time that literary property rights could potentially "reconcile" troublesome authors to society and state. 56

You feel the importance and necessity of defending property today. Well, begin by recognising the first and most sacred of all properties, the one which is neither a transmission nor an acquisition but a creation, namely literary property . . . reconcile the artists with society by means of property.43 57

Diderot wanted perpetual copyrights for authors and, agreeably to his employers, a correspondingly perpetual printing privilege. If the author's heirs could not be traced, the copyright would devolve to the current publisher. 58

But as Hesse points out, there was another view of literary property—a much more skeptical one put forward best by Condorcet. This view is also an influential part of the heritage of the droits d'auteur, even if it is downplayed in its contemporary rhetoric. Condorcet began by framing the question of literary property as one of political liberty. "Does a man have the right to forbid another man to write the same words that he himself wrote first? That is the question to resolve."44 Like Jefferson, Condorcet is utterly unconvinced that property rights in a book can be compared to those in a field or a piece of furniture which can be occupied or used by only one man. The type of property is "based on the nature of the thing." He concluded, again in language strikingly similar to Jefferson's and Macaulay's, that literary property was not a real property right but a privilege, and one which must be assessed on a utilitarian basis in terms of its contribution to enlightenment.45 59

Any privilege therefore imposes a hindrance on freedom, placing a restriction on the rights of other citizens; As such it is not only harmful to the rights of others who want to copy, but the rights of all those who want copies, and that which increases the price is an injustice. Does the public interest require that men make this sacrifice? That is the question that must be considered; In other words, are [literary] privileges needed and useful or harmful to the progress of enlightenment?46 60

Condorcet's conclusion was that they were not necessary and that they could be harmful. "The books that most furthered the progress of enlightenment, the Encyclopédie, the works of Montesquieu, Voltaire, Rousseau, have not enjoyed the benefits of a privilege." Instead he seemed to favor a combination of "subscriptions" to authors with a trademark-like protection which allowed an author to identify a particular edition of his work as the genuine one, but which also allowed competing editions to circulate freely. In such a market, he believed that the price of the competing editions would fall to "natural" levels—today we would call it marginal cost—but the original author would still be able to charge a modest premium for the edition he authorized or certified because readers would prefer it as both more accurate and more authentic. One possible analogy is to the history of the fashion industry in the United States. It operates largely without design protection but relies heavily on the trademarks accorded to favored designers and brands. There are "knockoffs" of Armani or Balenciaga, but the wealthy still pay an enormous premium for the real thing. 61

Condorcet also insisted that whatever protection was accorded to literary works must not extend to the ideas within them. It is the truths within books that make them "useful"—a word that does not have the same luminance and importance for us today as it did for the philosophers of the Enlightenment or the French Revolution. He argued that any privilege given the author could not extend to "preventing another man from exhibiting the same truths, in perfectly the same order, from the same evidence" or from extending those arguments and developing their consequences. In a line that Hesse rightly highlights, he declares that any privileges do not extend over facts or ideas. "Ce n'est pas pour les choses, les idées; c'est pour les mots, pour le nom de l'auteur." 62

In sum, Condorcet favors a limited privilege, circumscribed by an inquiry into its effects in promoting progress and enlightenment. The privilege only applies to expression and to "the author's name," rather than to facts and ideas. This is very much within the tradition of Jefferson and Macaulay. 63

Hesse argues, correctly I think, that two warring ideas shaped—or are at least useful ways of understanding—the development of the droits d'auteur tradition. On one side were Diderot and the publishers promoting an expansive and perpetual natural authorial right, which nevertheless was supposed to vest suspiciously easily in publishers. On the other was Condorcet, looking skeptically at authorial privileges as merely one type of state interference with free markets and the free circulation of books and ideas. In place of Diderot's perpetual natural right, Condorcet sketched out a regime that encourages production and distribution by granting the minimum rights necessary for progress. 64

Different as they are, these two sides share a common ground. They both focus, though for different reasons, on "expression"—the imprimatur of the author's unique human spirit on the ideas and facts that he or she transmits. It is this "original expression" that modern copyright and the modern droits d'auteur actually cover. In today's copyright law, the facts and ideas in an author's work proceed immediately into the public domain. In other work, I have argued that by confining the property right tightly to the "original expression" stemming from the unique personality of an individual author the law seems to accomplish a number of things simultaneously. It provides 65

a conceptual basis for partial, limited property rights, without completely collapsing the notion of property into the idea of a temporary, limited, utilitarian state grant, revocable at will. [At the same time it offers] a moral and philosophical justification for fencing in the commons, giving the author property in something built from the resources of the public domain—language, culture, genre, scientific community, or what have you. If one makes originality of spirit the assumed feature of authorship and the touchstone for property rights, one can see the author as creating something entirely new—not recombining the resources of the commons.47 66

That is an account of the romantic theory of authorship in the context of contemporary Anglo-American copyright law. But when one looks at the history of the French droits d'auteur tradition, it is striking how well those words describe that system as well. When the French legislature finally produced a law of authors' rights it turned out, in Hesse's words, to reflect "an epistemologically impure and unstable legal synthesis that combined an instrumentalist notion of the public good with a theory of authorship based on natural rights." 67

Although it drew on a Diderotist rhetoric of the sanctity of individual creativity as an inviolable right, it did not rigorously respect the conclusions Diderot drew from this position. In contrast to the privilège d'auteur of 1777, the law did not recognize the author's claim beyond his lifetime but consecrated the notion, advanced first by Pierre Manuel to defend his edition of Mirabeau, that the only true heir to an author's work was the nation as a whole. This notion of a public domain, of democratic access to a common cultural inheritance on which no particular claim could be made, bore the traces not of Diderot, but of Condorcet's faith that truths were given in nature and, although mediated through individual minds, belonged ultimately to all. Progress in human understanding depended not on private knowledge claims, but on free and equal access to enlightenment. An author's property rights were conceived as recompense for his service as an agent of enlightenment through publication of his ideas. The law of 1793 accomplished this task of synthesis through political negotiation rather than philosophical reasoning—that is, by refashioning the political identity of the author in the first few years of the Revolution from a privileged creature of the absolutist police state into a servant of public enlightenment.48 68

Hesse argues that this instability would continue through the revolutionary period. I agree; indeed I would argue that it does so to the present day. Why? The answer is simple. The moral rights view simply proved too much. Without a limiting principle—of time, or scope, or effect—it seemed to presage a perpetual and expansive control of expressive creations, and perhaps of inventions. Our intuition that this is a bad idea comes from our intuitive understanding that "Poetry can only be made out of other poems; novels out of other novels. All of this was much clearer before the assimilation of literature to private enterprise."49 69

This is the flip side of the arguments that Diderot and later Hugo put forward. Perhaps the romantic author does not create out of thin air. Perhaps he or she is deeply embedded in a literary, musical, cultural, or scientific tradition that would not flourish if treated as a set of permanently walled private plots. Even within the tradition, we see a recognition that the continuing progress of enlightenment and the ssacred genius of authors might both require a certain level of freedom in knowledge inputs and a certain level of control over knowledge outputs. We see also the recognition that these two requirements are in fundamental tension. When it comes to reconciling that tension we must turn in part to utilitarian effects. In short, we should pay attention to Jefferson and Macaulay and Condorcet, not just because their thoughts shaped the legal and philosophical traditions in which we now work—though that is particularly true in the case of the United States—but because they were right, or at least more right than the alternative. 70

Of course, we could build a culture around a notion of natural, absolute, and permanent rights to invention and expression. It is not a world many of us would want to live in. There are exceptions of course. In a recent New York Times op-ed, Mark Helprin—author of Winter's Tale—argued that intellectual property should become perpetual.50 After all, rights in real estate or personal property do not expire—though their owners might. Why is it that copyrights should "only" last for a lifetime plus seventy additional years, or patents for a mere twenty? Mr. Helprin expresses respect for the genius of the framers, but is unmoved by their firm command that rights be granted only for "limited times." He concludes that it was a misunderstanding. Jefferson did not realize that while ideas cannot be owned, their expression can. What's more, the framers were misled by their rustic times. "No one except perhaps Hamilton or Franklin might have imagined that services and intellectual property would become primary fields of endeavor and the chief engines of the economy. Now they are, and it is no more rational to deny them equal status than it would have been to confiscate farms, ropewalks and other forms of property in the 18th century." Poor Jefferson. How lucky we are to have Mr. Helprin to remedy the consequences of his lack of vision. 71

Or perhaps not. Think of the way that Jefferson traced the origins of the mechanical arts used in the elevators and hopper- boys all the way back to ancient Persia. (In Mr. Helprin's utopia, presumably, a royalty stream would run to Cyrus the Great's engineers.) Jefferson's point was that for the process of invention to work, we need to confine narrowly the time and scope of the state-provided monopoly, otherwise further inventions would become impossible. Each process or part of a new invention would risk infringing a myriad of prior patents on its subcomponents. Innovation would strangle in a thicket of conflicting monopolies with their roots vanishing back in time. Presumably the title of Mr. Helprin's excellent novel would require clearance from Shakespeare's heirs. 72

Of course, one could construct a more modest Lockean idea of intellectual property51 —building on the notion of "enough and as good" left over for others and drawing the limits tightly enough to avoid the worst of Mr. Helprin's excesses. But as one attempts to do this systematically, the power of the Jeffersonian vision becomes all the more apparent—at least as a starting place. 73

The Jefferson Warning will play an important role in this book. But my arguments here have implications far beyond Jefferson's time, country, or constitutional tradition. In the last analysis, I hope to convince you of the importance of the Jefferson Warning or the views of Macaulay not because they are famous authorities and revered thinkers or because they framed constitutions or debated legislation. I wish to convince you that their views are important because they encapsulate neatly an important series of truths about intellectual property. We should listen to the Jefferson Warning not because it is prestigious but because of its insight. As the Diderot-Condorcet debates point out, the questions on which Jefferson and Macaulay focused do not disappear merely because one embraces a philosophy of moral rights—if anything, they become more pressing, particularly when one comes to define the limits of intellectual property in scope and time. I ask that those readers who remain leery of the Jeffersonian focus concentrate on that last issue. In an era when we have been expanding intellectual property rights relentlessly, it is a crucial one. If the Jefferson Warning produces in my unconvinced reader even a slight queasiness about the likely effects of such a process of expansion, it will have done its job—though in fact the tradition it represented was much richer than a simple utilitarian series of cautions. 74

A TRADITION OF SKEPTICAL MINIMALISM 75

Eighteenth- and nineteenth-century intellectual property debates went beyond Macaulay's antimonopolist focus on price, access, quality, and control of the nation's literary heritage. While Macaulay is the best-remembered English skeptic from the 1840s, there were other, more radical skeptics who saw copyright primarily as a "tax on literacy" or a "tax on knowledge," identical in its effects to the newspaper stamp taxes.52 This was a time when mass literacy and mass education were the hotly debated corollaries to the enlargement of the franchise. The radical reformers looked with hostility on anything that seemed likely to raise the cost of reading and thus continue to restrict political and social debate to the wealthier classes. Macaulay worried about a world in which "a copy of Clarissa would . . . [be] as rare as an Aldus or a Caxton."53 His more radical colleagues saw copyright—to use our ugly jargon rather than theirs—as one of the many ways in which state communications policy is set and the communicative landscape tilted to favor the rich and powerful.54 Macaulay worried about the effects of monopoly on literature and culture. All of them worried about the effects of copyright on democracy, on speech, on education. In the world of the Internet, these skeptics too have their contemporary equivalents. 76

Patent law also attracted its share of attacks in the mid- nineteenth century. A fusillade of criticism, often delivered by economists and cast in the language of free trade, portrayed the patent system as actively harmful. 77

At the annual meeting of the Kongress deutscher Volkswirthe held in Dresden, September 1863, the following resolution was adopted "by an overwhelming majority": "Considering that patents hinder rather than further the progress of invention; that they hamper the prompt general utilization of useful inventions; that on balance they cause more harm than benefit to the inventors themselves and, thus, are a highly deceptive form of compensation; the Congress of German Economists resolves: that patents of invention are injurious to common welfare."55 78

In the Netherlands, the patent system was actually abolished in 1869 as a result of such criticisms. Observers in a number of other countries, including Britain, concluded that their national patent systems were doomed. Various proposals were made to replace patents, with state-provided prizes or bounties to particularly useful inventions being the most popular.56 79

These snippets are hardly sufficient to constitute any kind of survey of critical reactions to intellectual property systems, but I believe that nevertheless they give us some sense of typical debates. What do these debates tell us? 80

From the early days of intellectual property as we know it now, the main objections raised against it were framed in the language of free trade and "anti-monopoly." In the United States, the founding generation of intellectuals had been nurtured on the philosophy of the Scottish Enlightenment and the history of the struggle against royal monopolies. They saw the arguments in favor of intellectual property but warned again and again of the need to circumscribe both its term and its scope. This is the point at the heart of Jefferson's letter. This is why he insisted that we understand the policy implications of the differences between tangible property and ideas, which "like fire" are "expansible over all space, without lessening their density in any point." 81

What were the concerns of these early critics? They worried about intellectual property producing artificial scarcity, high prices, and low quality. They insisted that the benefits of each incremental expansion of intellectual property be weighed against its costs. Think of Macaulay discussing Johnson's preference for a shin of beef rather than another slice of postmortem copyright protection. They worried about its justice; given that we all learn from and build on the past, do we have a right to carve out our own incremental innovations and protect them by intellectual property rights?57 Price aside, they also worried that intellectual property (especially with a lengthy term) might give too much control to a single individual or corporation over some vital aspect of science and culture. In more muted fashion, they discussed the possible effects that intellectual property might have on future innovation. The most radical among them worried about intellectual property's effects on political debate, education, and even control of the communications infrastructure, though they did not use that particular phrase. But the overwhelming theme was the promotion of free trade and a corresponding opposition to monopolies. 82

Now if we were to stop here and simply require that today's policy makers, legislators, and judges recite the Jefferson Warning before they rush off to make new intellectual property rules for the Internet and the genome, we would have accomplished a great deal. National and international policy makers are keen to set the "rules of the road for the digital age." If they would momentarily pause their excited millenarian burbling and read the points scratched out with a quill pen in 1813, or delivered (without PowerPoint support) on the floor of the House of Commons in the 1840s, we would be better off. Everyone is beginning to understand that in the world of the twenty-first century the rules of intellectual property are both vital and contentious. How good it would be then if our debate on intellectual property policy were as vigorous and as informed as the debates of the nineteenth century. (Though we might hope it would also be more democratic.) 83

And yet . . . there is much that is missing from the skepticism of the eighteenth and nineteenth centuries and much that remains unclear. Look at the structure of these comments; they are framed as criticisms of intellectual property rather than defenses of the public domain or the commons, terms that simply do not appear in the debates. There is no real discussion of the world of intellectual property's outside, its opposite. Most of these critics take as their goal the prevention or limitation of an "artificial" monopoly; without this monopoly our goal is to have a world of—what? The assumption is that we will return to a norm of freedom, but of what kind? Free trade in expression and innovation, as opposed to monopoly? Free access to expression and innovation, as opposed to access for pay? Or free access to innovation and expression in the sense of not being subject to the right of another person to pick and choose who is given access, even if all have to pay some flat fee? Or is it common ownership and control that we seek, including the communal right to forbid certain kinds of uses of the shared resource? The eighteenth- and nineteenth-century critics brushed over these points; but to be fair, we continue to do so today. The opposite of property, or perhaps we should say the opposites of property, are much more obscure to us than property itself. 84

For the most part, the antimonopolist view of intellectual property makes a simple case. Monopolies are bad. Have as few as possible and make them as narrow and as short as possible. This is a fine principle, but it falls short of an affirmative explanation and defense of the role of the public domain or the commons in enabling creativity, culture, and science. That is a shame because just as intellectual property is different from tangible property, so too is its opposite, its outside. 85

What are those opposites? The two major terms in use are "the public domain" and "the commons." Both are used in multiple ways—probably a good thing. The public domain is material that is not covered by intellectual property rights. Material might be in the public domain because it was never capable of being owned. Examples would be the English language or the formulae of Newtonian physics. Alternatively, something might be in the public domain because rights have expired. The works of Shakespeare or the patents over powered flight are examples. 86

Some definitions of the public domain are more granular. They focus not only on complete works but on the reserved spaces of freedom inside intellectual property. The public domain would include the privilege to excerpt short quotations in a review. This vision is messier, but more instructive. If one uses a spatial metaphor, the absolutist vision is a tessellated map. Areas of private property are neatly delineated from areas of the public domain. Mozart's plot sits next to that of Britney Spears; one public, the other private. In the granular view, the map is more complex. Ms. Spears' plot is cut through with rights to make fair use, as well as with limitations on ownership of standard themes. Instead of the simple tiled map, the granular vision has private plots with public roads running through them. 87

In popular discussion, we tend to use the absolutist view of both property and the public domain. Lawyers prefer the more complex view of property and are coming slowly to have a similarly complex view of the public domain. That is the definition I will be using. 88

The term "commons" is generally used to denote a resource over which some group has access and use rights—albeit perhaps under certain conditions. It is used in even more ways than the term "public domain." The first axis along which definitions of the term "commons" vary is the size of the group that has access rights. Some would say it is a commons only if the whole society has access. That is the view I will take here. 89

The other difference between public domain and commons is the extent of restrictions on use. Material in the public domain is free of property rights. You may do with it what you wish. A commons can be restrictive. For example, some open source software makes your freedom to modify the software contingent on the condition that your contributions, too, will be freely open to others. I will discuss this type of commons in Chapter 8. 90

So these are working definitions of public domain and commons. But why should we care? Because the public domain is the basis for our art, our science, and our self-understanding. It is the raw material from which we make new inventions and create new cultural works. Why is it so important? Let us start with the dry reasons. 91

Information and innovation are largely nonrival and nonexcludable goods. This is Jefferson's point, though expressed in less graceful language. It has some interesting corollaries. Information is hard to value until you have it, but once you have it, how can you dispossess yourself of it? The apple can be taken back by the merchant if you decide not to buy. The facts or the formulae cannot. The moment when you might have decided to pay or not to pay is already over. The great economist Kenneth Arrow formalized this insight about information economics,58 and it profoundly shapes intellectual property policy. (To a large extent, for example, the requirement of "patent disclosure" attempts to solve this problem. I can read all about your mousetrap but I am still forbidden from using it. I can decide whether or not to license your design at that point.) But for all the material in the public domain, where no intellectual property right is necessary, this point is solved elegantly by having the information be "free as the air to common use." All of us can use the same store of information, innovation, and free culture. It will be available at its cost of reproduction—close to zero—and we can all build upon it without interfering with each other. Think of the English language, basic business methods, tables of logarithms, the Pythagorean theorem, Shakespeare's insights about human nature, the periodic table, Ohm's law, the sonnet form, the musical scale. 92

Would you have paid to purchase access to each of these? I might tell you that English was a superior communication tool—a really good command language for your cognitive operating system. There could be levels of access with corresponding prices. Would you pay to get access to "English Professional Edition"? We can certainly imagine such a way of organizing languages. (To some extent, scribal conventions operated this way. The languages of the professions still do. One paid for access to "law French" in the common law courts of England. One pays for an interpreter of contemporary legal jargon in today's legal system. But even there the language is free to the autodidact.) We can imagine language, scientific knowledge, basic algebra, the tonic scale, or the classics of four-hundred-year-old literature all being available only as property. Those who had the highest "value for use" would purchase them. Those who did not value them highly—whether because they could not know what could be built with them until they had done so or because they did not have the money—would not. What would this world, this culture, this science, this market look like? 93

It would probably be very inefficient, the economists tell us. Perfect information is a defining feature of the perfect market. The more commodified and restricted our access to information, the less efficient the operation of the market, the more poorly it allocates resources in our society. (The permanent and in some sense insoluble tension between the need to provide incentives to generate information, thus raising its cost, and the need to have access to perfect information for efficiency is the central feature of our intellectual property policy.)59 When we commodify too much we actually undermine creativity, since we are raising the price of the inputs for future creations—which might themselves be covered by intellectual property rights. But "inefficient" is too bloodless a way to describe this world. It would be awful. 94

Our markets, our democracy, our science, our traditions of free speech, and our art all depend more heavily on a public domain of freely available material than they do on the informational material that is covered by property rights. The public domain is not some gummy residue left behind when all the good stuff has been covered by property law. The public domain is the place we quarry the building blocks of our culture. It is, in fact, the majority of our culture. Or at least it has been. 95

I deliberately gave easy examples. It is obvious how unnecessary but also how harmful it would be to extend property rights to language, to facts, to business methods and scientific algorithms, to the basic structures of music, to art whose creators are long dead. It is obvious that this would not produce more innovation, more debate, more art, more democracy. But what about the places where the value of the public domain is not obvious? 96

What if we were actually moving to extend patents to business methods, or intellectual property rights to unoriginal compilations of facts? What if we had locked up most of twentieth-century culture without getting a net benefit in return? What if the basic building blocks of new scientific fields were being patented long before anything concrete or useful could be built from them? What if we were littering our electronic communication space with digital barbed wire and regulating the tiniest fragments of music as if they were stock certificates? What if we were doing all this in the blithe belief that more property rights mean more innovation? The story of this book is that we are. 97

The Jefferson Warning is important. It is, however, just a warning. While it would be excellent to print it on pocket cards and hand it to our elected representatives, that alone will not solve the most pressing problems we face. In the chapters that follow, I shall try to go further. In Chapter 3, I set the process of expansion we are engaged in—our "second enclosure movement"—in perspective by comparing it to the original enclosures of the grassy commons of old England. In Chapter 4, I jump from the world of the fifteenth or nineteenth century to the world of the twenty-first, from elevators and grain hoppers to video recorders, the Internet, and file-sharing services. I use the story of several key legal disputes to illustrate a broader history—the history of intellectual property's struggle with communications technologies that allow people to copy more cheaply. Strangely enough, the Jefferson Warning will be crucial in understanding the debate over copyright online and, in particular, in understanding the fear that drives our current policy making, a fear I refer to as the Internet Threat.

Chapter 3: The Second Enclosure Movement 1

The law locks up the man or woman
Who steals the goose from off the common
But leaves the greater villain loose
Who steals the common from off the goose.
2

The law demands that we atone
When we take things we do not own
But leaves the lords and ladies fine
Who take things that are yours and mine.
3

The poor and wretched don't escape
If they conspire the law to break;
This must be so but they endure
Those who conspire to make the law.
4

The law locks up the man or woman
Who steals the goose from off the common
And geese will still a common lack
Till they go and steal it back.
[Anon.]1
5

In fits and starts from the fifteenth to the nineteenth century, the English "commons" was "enclosed." 2 Enclosure did not necessarily mean physical fencing, though that could happen. More likely, the previously common land was simply converted into private property, generally controlled by a single landholder. 6

The poem that begins this chapter is the pithiest condemnation of the process. It manages in a few lines to criticize double standards, expose the controversial nature of property rights, and take a slap at the legitimacy of state power. And it does this all with humor, without jargon, and in rhyming couplets. Academics should take note. Like most criticisms of the enclosure movement, the poem depicts a world of rapacious, state-aided "privatization," a conversion into private property of something that had formerly been common property or perhaps had been outside the property system altogether. One kind of "stealing" is legal, says the poet, because the state changes the law of property to give the "lords and ladies" a right over an area formerly open to all. But let a commoner steal something and he is locked up. 7

The anonymous author was not alone in feeling indignant. Thomas More (one of only two saints to write really good political theory) made similar points, though he used sheep rather than geese in his argument. Writing in the sixteenth century, he had argued that enclosure was not merely unjust in itself but harmful in its consequences: a cause of economic inequality, crime, and social dislocation. In a wonderfully bizarre passage he argues that sheep are a principal cause of theft. Sheep? Why, yes. 8

[Y]our sheep that were wont to be so meek and tame, and so small eaters, now, as I hear say, be become so great devourers and so wild, that they eat up, and swallow down the very men themselves. They consume, destroy, and devour whole fields, houses, and cities. 9

Who were these sheep? Bizarre Dolly-like clones? Transgenic killer rams? No. More meant only that under the economic lure of the wool trade, the "noblemen and gentlemen" were attempting their own enclosure movement. 10

[They] leave no ground for tillage, they enclose all into pastures; they throw down houses; they pluck down towns, and leave nothing standing, but only the church to be made a sheep- house. . . . Therefore that one covetous and insatiable cormorant and very plague of his native country may compass about and enclose many thousand acres of ground together within one pale or hedge, the husbandmen be thrust out of their own.3 11

The sheep devour all. The dispossessed "husbandmen" now find themselves without land or money and turn instead to theft. In More's vision, it is all very simple. Greed leads to enclosure. Enclosure disrupts the life of the poor farmer. Disruption leads to crime and violence. 12

Writing 400 years later, Karl Polanyi echoes More precisely. He calls the enclosure movement "a revolution of the rich against the poor" and goes on to paint it in the most unflattering light. "The lords and nobles were upsetting the social order, breaking down ancient law and custom, sometimes by means of violence, often by pressure and intimidation. They were literally robbing the poor of their share in the common. . . ." 4 And turning them to "beggars and thieves." The critics of enclosure saw other harms too, though they are harder to classify. They bemoaned the relentless power of market logic to migrate to new areas, disrupting traditional social relationships and perhaps even views of the self, or the relationship of human beings to the environment. Fundamentally, they mourned the loss of a form of life. 13

So much for the bad side of the enclosure movement. For many economic historians, everything I have said up to now is the worst kind of sentimental bunk, romanticizing a form of life that was neither comfortable nor noble, and certainly not very egalitarian. The big point about the enclosure movement is that it worked; this innovation in property systems allowed an unparalleled expansion of productive possibilities. 5 By transferring inefficiently managed common land into the hands of a single owner, enclosure escaped the aptly named "tragedy of the commons." It gave incentives for large-scale investment, allowed control over exploitation, and in general ensured that resources could be put to their most efficient use. Before the enclosure movement, the feudal lord would not invest in drainage systems, sheep purchases, or crop rotation that might increase yields from the common—he knew all too well that the fruits of his labor could be appropriated by others. The strong private property rights and single-entity control that were introduced in the enclosure movement avoid the tragedies of overuse and underinvestment: more grain will be grown, more sheep raised, consumers will benefit, and fewer people will starve in the long run. 6 14

If the price of this social gain is a greater concentration of economic power, the introduction of market forces into areas where they previously had not been so obvious, or the disruption of a modus vivendi with the environment—then, enclosure's defenders say, so be it! In their view, the agricultural surplus produced by enclosure helped to save a society devastated by the mass deaths of the sixteenth century. Those who weep over the terrible effects of private property should realize that it literally saves lives. 15

Now it is worth noting that while this view was once unchallenged, 7 recent scholarship has thrown some doubts on the effects of enclosure on agricultural production. 8 Some scholars argue that the commons was actually better run than the defenders of enclosure admit. 9 Thus, while enclosure did produce the changes in the distribution of wealth that so incensed an earlier generation of critical historians, they argue that there are significant questions about whether it led to greater efficiency or innovation. The pie was carved up differently, but did it get bigger? The debate about these issues is little known, however, outside the world of economic historians. "Everyone" knows that a commons is by definition tragic and that the logic of enclosure is as true today as it was in the fifteenth century. I will not get involved in this debate. Assume for the sake of argument that enclosure did indeed produce a surge in agriculture. Assume, in other words, that converting the commons into private property saved lives. This is the logic of enclosure. It is a powerful argument, but it is not always right. 16

This is all very well, but what does it have to do with intellectual property? I hope the answer is obvious. The argument of this book is that we are in the middle of a second enclosure movement. While it sounds grandiloquent to call it "the enclosure of the intangible commons of the mind," in a very real sense that is just what it is. 10 True, the new state- created property rights may be "intellectual" rather than "real," but once again things that were formerly thought of as common property, or as "uncommodifiable," or outside the market altogether, are being covered with new, or newly extended, property rights. 17

Take the human genome as an example. Again, the supporters of enclosure have argued that the state was right to step in and extend the reach of property rights; that only thus could we guarantee the kind of investment of time, ingenuity, and capital necessary to produce new drugs and gene therapies. 11 To the question, "Should there be patents over human genes?" the supporters of enclosure would answer that private property saves lives. 12 The opponents of enclosure have claimed that the human genome belongs to everyone, that it is literally the common heritage of humankind, that it should not and perhaps in some sense cannot be owned, and that the consequences of turning over the human genome to private property rights will be dreadful, as market logic invades areas which should be the farthest from the market. In stories about stem cell and gene sequence patents, critics have mused darkly about the way in which the state is handing over monopoly power to a few individuals and corporations, potentially introducing bottlenecks and coordination costs that slow down innovation. 13 18

Alongside these accounts of the beneficiaries of the new property scheme run news stories about those who were not so fortunate, the commoners of the genetic enclosure. Law students across America read Moore v. Regents of University of California, a California Supreme Court case deciding that Mr. Moore had no property interest in the cells derived from his spleen. 14 The court tells us that giving private property rights to "sources" would slow the freewheeling practice researchers have of sharing their cell lines with all and sundry. 15 The doctors whose inventive genius created a billion- dollar cell line from Mr. Moore's "naturally occurring raw material," by contrast, are granted a patent. Private property rights here, by contrast, are a necessary incentive to research. 16 Economists on both sides of the enclosure debate concentrate on the efficient allocation of rights. Popular discussion, on the other hand, doubtless demonstrating a reprehensible lack of rigor, returns again and again to more naturalistic assumptions such as the essentially "common" quality of the property involved or the idea that one owns one's own body. 17 19

The genome is not the only area to be partially "enclosed" during this second enclosure movement. The expansion of intellectual property rights has been remarkable—from business method patents, to the Digital Millennium Copyright Act, to trademark "anti-dilution" rulings, to the European Database Protection Directive. 18 The old limits to intellectual property rights—the antierosion walls around the public domain—are also under attack. The annual process of updating my syllabus for a basic intellectual property course provides a nice snapshot of what is going on. I can wax nostalgic looking back to a five- year-old text, with its confident list of subject matter that intellectual property rights could not cover, the privileges that circumscribed the rights that did exist, and the length of time before a work falls into the public domain. In each case, the limits have been eaten away. 20

HOW MUCH OF THE INTANGIBLE COMMONS SHOULD WE ENCLOSE? 21

So far I have argued that there are profound similarities between the first enclosure movement and our contemporary expansion of intellectual property, which I call the second enclosure movement. Once again, the critics and proponents of enclosure are locked in battle, hurling at each other incommensurable claims about innovation, efficiency, traditional values, the boundaries of the market, the saving of lives, the loss of familiar liberties. Once again, opposition to enclosure is portrayed as economically illiterate: the beneficiaries of enclosure telling us that an expansion of property rights is needed in order to fuel progress. Indeed, the post-Cold War "Washington consensus" is invoked to claim that the lesson of history itself is that the only way to get growth and efficiency is through markets; property rights, surely, are the sine qua non of markets. 19 22

This faith in enclosure is rooted in a correspondingly deep pessimism about the possibility of managing resources that are either commonly owned or owned by no one. If all have the right to graze their herds on common land, what incentive does anyone have to hold back? My attempt to safeguard the future of the pasture will simply be undercut by others anxious to get theirs while the getting is good. Soon the pasture will be overgrazed and all our flocks will go hungry. In a 1968 article, Garrett Hardin came up with the phrase that would become shorthand for the idea that there were inherent problems with collectively managed resources: "the tragedy of the commons." 20 The phrase, more so than the actual arguments in his article, has come to exercise considerable power over our policies today. Private property—enclosure—is portrayed as the happy ending for the tragedy of the commons: when policy makers see a resource that is unowned, they tend to reach reflexively for "the solving idea of property." According to this view, enclosure is not a "revolution of the rich against the poor," it is a revolution to save the waste of socially vital resources. To say that some social resource is not owned by an individual, that it is free as the air to common use, is automatically to conjure up the idea that it is being wasted. 23

But if there are similarities between our two enclosures, there are also profound dissimilarities; the networked commons of the mind has many different characteristics from the grassy commons of Old England. 21 I want to concentrate here on two key differences between the intellectual commons and the commons of the first enclosure movement, differences that should lead us to question whether this commons is truly tragic and to ask whether stronger intellectual property rights really are the solution to our problems. These differences are well known, indeed they are the starting point for most intellectual property law, a starting point that Jefferson and Macaulay have already laid out for us. Nevertheless, reflection on them might help to explain both the problems and the stakes in the current wave of expansion. 24

Unlike the earthy commons, the commons of the mind is generally "nonrival." Many uses of land are mutually exclusive: if I am using the field for grazing, it may interfere with your plans to use it for growing crops. By contrast, a gene sequence, an MP3 file, or an image may be used by multiple parties; my use does not interfere with yours. To simplify a complicated analysis, this means that the threat of overuse of fields and fisheries is generally not a problem with the informational or innovational commons. 22 Thus, one type of tragedy of the commons is avoided. 25

The concerns in the informational commons have to do with a different kind of collective action problem: the problem of incentives to create the resource in the first place. The difficulty comes from the assumption that information goods are not only nonrival (uses do not interfere with each other), but also nonexcludable (it is impossible, or at least hard, to stop one unit of the good from satisfying an infinite number of users at zero marginal cost). Pirates will copy the song, the mousetrap, the drug formula, the brand. The rest of the argument is well known. Lacking an ability to exclude, creators will be unable to charge for their creations; there will be inadequate incentives to create. Thus, the law must step in and create a limited monopoly called an intellectual property right. 26

How about the argument that the increasing importance of information-intensive products to the world economy means that protection must increase? Must the information commons be enclosed because it is now a more important sector of economic activity? 23 This was certainly one of the arguments for the first enclosure movement. For example, during the Napoleonic Wars enclosure was defended as a necessary method of increasing the efficiency of agricultural production, now a vital sector of a wartime economy. 27

Here we come to another big difference between the commons of the mind and the earthy commons. As has frequently been pointed out, information products are often made up of fragments of other information products; your information output is someone else's information input. 24 These inputs may be snippets of code, discoveries, prior research, images, genres of work, cultural references, or databases of single nucleotide polymorphisms—each is raw material for future innovation. Every increase in protection raises the cost of, or reduces access to, the raw material from which you might have built those future products. The balance is a delicate one; one Nobel Prize-winning economist has claimed that it is actually impossible to strike that balance so as to produce an informationally efficient market. 25 28

Whether or not it is impossible in theory, it is surely a difficult problem in practice. In other words, even if enclosure of the arable commons always produced gains (itself a subject of debate), enclosure of the information commons clearly has the potential to harm innovation as well as to support it. 26 More property rights, even though they supposedly offer greater incentives, do not necessarily make for more and better production and innovation—sometimes just the opposite is true. It may be that intellectual property rights slow down innovation, by putting multiple roadblocks in the way of subsequent innovation. 27 Using a nice inversion of the idea of the tragedy of the commons, Heller and Eisenberg referred to these effects—the transaction costs caused by myriad property rights over the necessary components of some subsequent innovation—as "the tragedy of the anticommons." 28 29

In short, even if the enclosure movement was a complete success, there are important reasons to believe that the intangible world is less clearly a candidate for enclosure, that we should pause, study the balance between the world of the owned and the world of the free, gather evidence. After all, even in physical space, "common" property such as roads increases the value of the surrounding private tracts. If there are limits to the virtues of enclosure even there, how much more so in a world of intangible and nonrival goods, which develop by drawing on prior creations? Yet the second enclosure movement proceeds confidently nevertheless—with little argument and less evidence. 30

To be sure, there is a danger of overstatement. The very fact that the changes have been so one-sided makes it hard to resist exaggerating their impact. In 1918, Justice Brandeis confidently claimed that "[t]he general rule of law is, that the noblest of human productions—knowledge, truths ascertained, conceptions, and ideas—become, after voluntary communication to others, free as the air to common use." 29 That baseline—intellectual property rights are the exception rather than the norm; ideas and facts must always remain in the public domain—is still supposed to be our starting point. 30 It is, however, under attack. 31

Both overtly and covertly, the commons of facts and ideas is being enclosed. Patents are increasingly stretched to cover "ideas" that twenty years ago all scholars would have agreed were unpatentable. 31 Most troubling of all are the attempts to introduce intellectual property rights over mere compilations of facts. 32 If U.S. intellectual property law had an article of faith, it was that unoriginal compilations of facts would remain in the public domain, that this availability of the raw material of science and speech was as important to the next generation of innovation as the intellectual property rights themselves. 33 The system would hand out monopolies in inventions and in original expression, while the facts below (and ideas above) would remain free for all to build upon. But this premise is being undermined. Some of the challenges are subtle: in patent law, stretched interpretations of novelty and nonobviousness allow intellectual property rights to move closer and closer to the underlying data layer; gene sequence patents come very close to being rights over a particular discovered arrangement of data—C's, G's, A's, and T's. 34 Other challenges are overt: the European Database Protection Directive did (and various proposed bills in the United States would) create proprietary rights over compilations of facts, often without even the carefully framed exceptions of the copyright scheme, such as the usefully protean category of fair use. 32

The older strategy of intellectual property law was a "braided" one: thread a thin layer of intellectual property rights around a commons of material from which future creators would draw. 35 Even that thin layer of intellectual property rights was limited so as to allow access to the material when that was necessary to further the goals of the system. Fair use allows for parody, commentary, and criticism, and also for "decompilation" of computer programs so that Microsoft's competitors can reverse engineer Word's features in order to make sure their program can convert Word files. It may sound paradoxical, but in a very real sense protection of the commons was one of the fundamental goals of intellectual property law. 33

In the new vision of intellectual property, however, property should be extended everywhere; more is better. Expanding patentable and copyrightable subject matter, lengthening the copyright term, giving legal protection to "digital barbed wire," even if it is used to prevent fair use: each of these can be understood as a vote of no confidence in the productive powers of the commons. We seem to be shifting from Brandeis's assumption that the "noblest of human productions are free as the air to common use" to the assumption that any commons is inefficient, if not tragic. 34

The expansion is more than a formal one. It used to be relatively hard to violate an intellectual property right. The technologies of reproduction or the activities necessary to infringe were largely, though not entirely, industrial. Imagine someone walking up to you in 1950, handing you a book or a record or a movie reel, and saying "Quick! Do something the law of intellectual property might forbid." (This, I admit, is a scenario only likely to come to the mind of a person in my line of work.) You would have been hard-pressed to do so. Perhaps you could find a balky mimeograph machine, or press a reel-to-reel tape recorder into use. You might manage a single unauthorized showing of the movie—though to how many people? But triggering the law of intellectual property would be genuinely difficult. Like an antitank mine, it would not be triggered by the footsteps of individuals. It was reserved for bigger game. 35

This was no accident. The law of intellectual property placed its triggers at the point where commercial activity by competitors could undercut the exploitation of markets by the rights holder. Copying, performance, distribution—these were things done by other industrial entities who were in competition with the owner of the rights: other publishers, movie theaters, distributors, manufacturers. In practice, if not theory, the law was predominantly a form of horizontal industry regulation of unfair competition—made by the people in the affected industries for the people in the affected industries. The latter point is worth stressing. Congress would, and still does, literally hand over the lawmaking process to the industries involved, telling them to draft their intra-industry contract in the form of a law, and then to return to Congress to have it enacted. The public was not at the table, needless to say, and the assumption was that to the extent there was a public interest involved in intellectual property law, it was in making sure that the industries involved got their act together, so that the flow of new books and drugs and movies would continue. Members of the public, in other words, were generally thought of as passive consumers of finished products produced under a form of intraindustry regulation that rarely implicated any act that an ordinary person would want, or be able, to engage in. 36

In the world of the 1950s, these assumptions make some sense—though we might still disagree with the definition of the public interest. It was assumed by many that copyright need not and probably should not regulate private, noncommercial acts. The person who lends a book to a friend or takes a chapter into class is very different from the company with a printing press that chooses to reproduce ten thousand copies and sell them. The photocopier and the VCR make that distinction fuzzier, and the networked computer threatens to erase it altogether. 37

So how are things different today? If you are a person who routinely uses computers, the Internet, or digital media, imagine a day when you do not create—intentionally and unintentionally—hundreds of temporary, evanescent copies. (If you doubt this, look in the cache of your browser.) Is there a day when you do not "distribute" or retransmit fragments of articles you have read, when you do not seek to share with friends some image or tune? Is there a day when you do not rework for your job, for your class work, or simply for pastiche or fun, some of the digital material around you? In a networked society, copying is not only easy, it is a necessary part of transmission, storage, caching, and, some would claim, even reading. 36 38

As bioinformatics blurs the line between computer modeling and biological research, digital production techniques blur the lines between listening, editing, and remaking. "Rip, mix, and burn," says the Apple advertisement. It marks a world in which the old regime of intellectual property, operating upstream as a form of industrial competition policy, has been replaced. Intellectual property is now in and on the desktop and is implicated in routine creative, communicative, and just plain consumptive acts that each of us performs every day. Suddenly, the triggers of copyright—reproduction, distribution—can be activated by individual footsteps. 39

Of course, we would hope that in your daily actions you scrupulously observed the rights—all the rights—of the companies that have interests in the texts, tunes, images of celebrities, trademarks, business method patents, and fragments of computer code you dealt with. Did you? Can you be sure? I teach intellectual property, but I admit to some uncertainty. 40

I would not have imagined that a temporary image of a Web page captured in the cache of my browser counted as a "copy" for the purposes of copyright law. 37 I would have thought that it was fair use for a company to photocopy articles in journals it subscribed to, and paid for, in order to circulate them to its researchers. 38 If a conservative Web site reposted news articles from liberal newspapers with critical commentary, that, too, would have seemed like fair use. 39 I would have thought that it was beneficial competition, and not a trespass, for an electronic "aggregator" to gather together auction prices or airline fares, so as to give consumers more choice. 40 I would not have thought that a search engine that catalogued and displayed in framed format the digital graphics found on the Internet would be sued for infringing the copyrights of the owners of those images. 41 I would not have thought that I might be sued for violating intellectual property law if I tried to compete with a printer company by making toner cartridges that were compatible with its printers. 42 41

The examples go on. I know that the "research exemption" in U.S. patent law is very tightly limited, but I would have laughed if you had told me that even a research university was forbidden from doing research unless that research had no conceivable practical or academic worth—in other words that even in academia, in a project with no commercial goal, the research exemption only covered research that was completely pointless. 43 Why have an exemption at all, in that case? I would have told an academic cryptography researcher that he need not fear legal threats from copyright owners simply for researching and publishing work on the vulnerabilities of copy protection schemes. 44 I would not have thought that one could patent the idea of having an electronic Dutch auction on the Internet, working out the daily prices of a bundle of mutual funds through simple arithmetic, or buying something online with one click. 45 I would have assumed that celebrities' rights to control their images should end with their deaths, and that courts would agree that those rights were tightly limited by the First Amendment. Yet, in each of these cases, I would have been wrong, or at least I might be wrong—enough that a sane person would worry. Not all of the expansive claims eventually triumphed, of course, but some did. Guessing which would and which would not was hard even for me, though, as I said, I teach intellectual property law. You, probably, do not. 42

In 1950 none of this would have mattered. Unless you were in some related business—as a publisher, broadcaster, film distributor, or what have you—it would have been hard for you to trigger the rules of intellectual property law. If you were in such a business, you were probably very familiar with the rules that governed your activities and well represented by corporate counsel who knew them even better. What's more, the rules were neither as complex nor as counterintuitive as they are now. They also did not reach as far. The reach of the rights has been expanded, and their content made more difficult to understand, at the exact moment that their practical effect has been transformed. It is not merely that the triggers of intellectual property law can easily be set off by individual footsteps. There are now many more triggers and their trip wires are harder to see. 43

From the point of view of the content industries, of course, all this is foolishness. It is not some undesirable accident that intellectual property has come to regulate personal, noncommercial activity. It is absolutely necessary. Think of Napster. When individuals engaging in noncommercial activity have the ability to threaten the music or film industry's business plan by engaging in the very acts that copyright law always regulated—namely reproduction and distribution—of course it is appropriate for them, and the networks they "share" on, to be subject to liability. What's more, to the extent that copying becomes cheaper and easier, it is necessary for us to strengthen intellectual property rights. We must meet the greater danger of copying with more expansive rights, harsher penalties, and expanded protections, some of which may indeed have the practical effect of reducing rights that citizens thought they had, such as fair use, low-level noncommercial sharing among personal friends, resale, and so on. Without an increase in private property rights, in other words, cheaper copying will eat the heart out of our creative and cultural industries. I call this claim the Internet Threat.

Chapter 4: The Internet Threat 1

The conventional wisdom is that governments respond slowly to technological change. In the case of the Internet, nothing could be further from the truth. In 1994 and 1995, "dot-com" was still a mystical term for many. Most stories about the Internet dealt with sexual predation rather than possibilities of extreme wealth. Internet commerce itself was barely an idea, and some of the most exciting sites on the Web had pictures of coffeepots in university departments far away. ("See," one would proudly say to a technological neophyte friend when introducing him to the wonders of the Net, "the pot is empty and we can see that live from here! This changes everything!") It was an innocent time. Yet the U.S. government was already turning the wheels of intellectual property policy to respond to the threat (and promise) of the Internet. More precisely, they were trying to shape the future of the cumbersomely named "National Information Infrastructure," the official name for the "information superhighway" that it was presumed would replace the "immature" technology of the Net. The government was wrong about that, and about a lot else. 2

The blueprint for new intellectual property policy online came from the Patent and Trademark Office. That office promulgated first a Green Paper and then, after further hearings, a White Paper, on "Intellectual Property and the National Information Infrastructure."1 As policy and legal documents these are in one sense long out of date. Some of their legal arguments were successfully challenged. Some of their most important proposals were rejected, while many others have become law. But as a starting point from which to trace the frame of mind that has come to dominate intellectual property policy online, they are hard to equal. 3

These documents contained proposals that nowadays would be seen as fairly controversial. Internet service providers were said to be "strictly liable" for copyright violations committed by their subscribers; that is to say, they were legally responsible whether or not they knew about the violation or were at fault in any way. Loading a document into your browser's transient cache memory while reading it was said to be making a "copy." There was more: the beginnings of what later became the Digital Millennium Copyright Act,2 making it illegal to cut through the digital fences which content providers put around their products. The attitude toward fair use was particularly revealing. At one point in the White Paper it was hinted that fair use might be a relic of the inconveniences of the analog age, to be discarded now that we could have automated fractional payments for even the most insignificant use.3 (It was noted, however, that some disagreed with this conclusion.) At another point, fair use was described as a "tax" on rights holders and a "subsidy" to those who benefited from it, such as educational institutions.4 The White Paper also suggested that while any potential loss to rights holders caused by the new technology needed to be countered with new rights and new protections, any potential gain to them through the new technology was simply theirs. Potential gain did not offset the need to compensate for potential loss. 4

So what views of intellectual property were we carrying forward into the Internet age? Intellectual property is just like other property. Rights are presumptively absolute. Any limitations on them, such as fair use, are taxes on property owners, subsidies to the society at large. It sounds like a perfect time to administer the Jefferson Warning I sketched out in Chapter 2. After all, Jefferson was specifically warning against each of these errors two hundred years ago. To find them in a student paper would be disappointing—irritating, even. But this document was the blueprint for the intellectual property regime of cyberspace. 5

But do these mistakes matter? How important is it that we get the rules of intellectual property right? To me, a number of my colleagues, some librarians, a few software gurus, the White Paper was more than just a bit of bad policy in a technical field—like a poorly drafted statute about the witnessing of wills, say. When you set up the property rules in some new space, you determine much about the history that follows. Property rules have a huge effect on power relationships and bargaining positions. Think of rules setting out water rights or the right to drive cattle over homesteaders' land in the American West. But they also are part of a larger way of seeing the world; think of the early-twentieth-century rules treating unions as "conspiracies in restraint of trade" or the Supreme Court decisions that dispossessed the American Indians on the theory that they did not comprehend the concept of property and thus did not "own" the land being taken from them.5 We were at a comparable point in the history of cyberspace. What was being set up here was a vision of economy and culture, a frame of mind about how the world of cultural exchange operates, and eventually a blueprint for our systems of communication. At this stage, the range of possibilities is extremely wide. A lot of different choices could be made, but subsequent changes would be harder and harder as people and companies built their activities around the rules that had been laid down. This was, in short, a tipping point where it was particularly important that we make the right decisions. 6

Conventional political science told us there were a lot of reasons to fear that we would not make the right decisions. The political process was going to be particularly vulnerable to problems of capture by established industries, many of whom would (rightly) see the Internet as a potential threat to their role as intermediaries between artists and creators on the one hand and the public on the other. 7

Intellectual property legislation had always been a cozy world in which the content, publishing, and distribution industries were literally asked to draft the rules by which they would live. The law was treated as a kind of contract between the affected industries. Rationally enough, those industries would wish to use the law not merely to protect their legitimate existing property rights, but to make challenges to their basic business plans illegal. (Imagine what would have happened if we had given the lamp-oil sellers the right to define the rules under which the newfangled electric light companies would operate.) There would be no easy counterweight to these pressures, as Jessica Litman points out in a wonderful set of reflections on copyright lawmaking, because the potential competitors to existing titans were just being born and could thus be strangled safely in their cradles.6 Certainly the public would have little grasp as yet of what was at stake. 8

In any event, when had the public played a role in intellectual property legislation? That kind of law affected businesses with printing presses or TV towers, not normal citizens. It did not help that the legislators were largely both ignorant and distrustful of the technology of the Internet—which was, at the time, thought to be dominated by foreign hackers, suicidal cults, pirates, and sleazy pornographers. (Terrorists and Nigerian spammers would be added to the mix later.) 9

Given an area of law that legislators were happy to hand over to the affected industries and a technology that was both unfamiliar and threatening, the prospects for legislative insight were poor. Lawmakers were assured by lobbyists 10

a) that this was business as usual, that no dramatic changes were being made by the Green or White papers; or b) that the technology presented a terrible menace to the American cultural industries, but that prompt and statesmanlike action would save the day; or c) that layers of new property rights, new private enforcers of those rights, and technological control and surveillance measures were all needed in order to benefit consumers, who would now be able to "purchase culture by the sip rather than by the glass" in a pervasively monitored digital environment. 11

In practice, somewhat confusingly, these three arguments would often be combined. Legislators' statements seemed to suggest that this was a routine Armageddon in which firm, decisive statesmanship was needed to preserve the digital status quo in a profoundly transformative and proconsumer way. Reading the congressional debates was likely to give one conceptual whiplash. 12

To make things worse, the press was—in 1995, at least—clueless about these issues. It was not that the newspapers were ignoring the Internet. They were paying attention—obsessive attention in some cases. But as far as the mainstream press was concerned, the story line on the Internet was sex: pornography, online predation, more pornography. The lowbrow press stopped there. To be fair, the highbrow press was also interested in Internet legal issues (the regulation of pornography, the regulation of online predation) and constitutional questions (the First Amendment protection of Internet pornography). Reporters were also asking questions about the social effect of the network (including, among other things, the threats posed by pornography and online predators). 13

There were certainly important issues within the areas the press was willing to focus on, and I do not mean to trivialize them. I worked with a couple of civil liberties groups in opposing the hapless Communications Decency Act, one of the most poorly drafted pieces of speech regulation ever to come out of Congress.7 It was a palpably unconstitutional statute, eventually struck down by a unanimous Supreme Court.8 Its proposals would have burdened the speech of adults while failing to protect the interests of minors. Reporters loved the topic of the Communications Decency Act. It was about sex, technology, and the First Amendment. It foreshadowed the future of online speech regulation. One could write about it while feeling simultaneously prurient, principled, and prescient: the journalistic trifecta. For law professors who worked on digital issues, the Communications Decency Act was an easy topic to get the public to focus on; we had the reporters and editors calling us, pleading for a quote or an opinion piece. 14

Intellectual property was something quite different. It was occasionally covered in the business pages with the same enthusiasm devoted to changes in derivatives rules. Presented with the proposals in the Green and White Papers, the reporters went looking for opinions from the Software Publishers Association, the Recording Industry Association of America, or the Motion Picture Association of America. This was not bias or laziness—to whom else would they go? Who was on the "other side" of these issues? Remember, all of this occurred before Napster was a gleam in Sean Fanning's eye. Sean Fanning was in middle school. Amazon.com was a new company and "Google" was not yet a verb. 15

In this environment, convincing the legislature or the press that fundamental public choices were implicated in the design of intellectual property rights for the digital world was about as easy as convincing them that fundamental public choices were implicated in the rules of tiddlywinks. My own experience is probably representative. I remember trying to pitch an article on the subject to a charming but uncomprehending opinion page editor at the Washington Post. I tried to explain that decisions about property rules would shape the way we thought about the technology. Would the relatively anonymous and decentralized characteristics of the Internet that made it such a powerful tool for global speech and debate come to be seen as a bug rather than a feature, something to be "fixed" to make the Net safe for protected content? The rules would also shape the economic interests that drove future policy. Would we try to build the system around the model of proprietary content dispensed in tightly controlled chunks? Would fair use be made technologically obsolescent? Would we undercut the various nontraditional methods of innovation, such as free software, before they ever managed to establish themselves? What would become of libraries in the digital world, of the ideal that access to books had important differences from access to Twinkies? After I concluded this lengthy and slightly incoherent cri de Coeur, there was a long pause; then the editor said politely, "Are you sure you couldn't make some of these points about a free speech issue, like the Communications Decency Act, maybe?" 16

I finally placed the piece in the Washington Times,9 which was best known at the time as the only metropolitan newspaper owned by the Unification Church, familiarly referred to as the Moonies. This hardly counted as a direct line to the popular imagination (though the article's mild criticisms elicited an extraordinary reaction from the Clinton administration's lead official on intellectual property policy—throwing me for several weeks into a surreal world of secondhand threats, third-party leaks, and a hilarious back-and-forth in the letters page).10 17

Things were not completely one-sided. An unlikely group of critics had formed: librarians, a few software developers, law professors, some Internet libertarians. Of particular note was the Digital Future Coalition, which grew to represent a broad range of interested groups and industries thanks in part to the prescient analysis and remarkable energy of one of my colleagues, Peter Jaszi.11 Together with Pamela Samuelson, Jessica Litman, and a number of other distinguished legal scholars, Peter turned his considerable intellectual talents to explaining why writers, telecom companies, scientists, manufacturers of consumer electronics, and a host of other groups should be interested in the rules being debated. There had been a series of official hearings in which complaints were carefully collected and just as carefully ignored. This became harder to do as the critics became more numerous and better organized. Nevertheless, the currents were clearly running against them. It would be nice to say that this was merely because of the clubby history of intellectual property legislation, or the difficulty in getting press attention, or the various issues of industry capture and collective action problems. Yet this would be to miss a vital element of the situation. 18

Conventional political science showed that there were structural reasons why the legislative process was likely to succumb to industry capture.12 The reality turned out to be much worse. The real problem was not a political process dominated by cynical power politics, nor an initial absence of critical newspaper coverage, though both of those factors contributed. The real problem was that most of the proponents of the White Paper's policies believed their own arguments so deeply and sincerely that they saw any criticism of those positions as either godless communism or hippy digital anarchism. (Frequently, in fact, they clung to their arguments even when there was fairly strong evidence that they would actually be harming themselves by putting these policies into effect. I will expand on this point later.) More importantly, they succeeded in getting their story about the threats and promises of the digital future accepted as the basis for all discussion of intellectual property policy. It became the organizing set of principles, the master narrative—call it what you will. 19

The heart of the story is beguilingly simple. The Internet makes copying cheaper and does so on an unparalleled global scale. Therefore we must meet the greater danger of illicit copying with more expansive rights, harsher penalties, and expanded protections. True, as I pointed out before, some of these expansions may indeed have the practical effect of reducing rights that citizens thought they had, such as fair use, low- level noncommercial sharing among personal friends, resale, and so on. But without an increase in private property rights, cheaper copying will eat the heart out of our creative and cultural industries. I call this story the Internet Threat. It is a powerful argument and it deserves some explanation. 20

Think back for a moment to the first chapter and the difference between Madame Bovary and the petunia. If the reason for intellectual property rights is the "nonrival" and "nonexcludable" nature of the goods they protect, then surely the lowering of copying and transmission costs implies a corresponding need to increase the strength of intellectual property rights. Imagine a line. At one end sits a monk painstakingly transcribing Aristotle's Poetics. In the middle lies the Gutenberg printing press. Three-quarters of the way along the line is a photocopying machine. At the far end lies the Internet and the online version of the human genome. At each stage, copying costs are lowered and goods become both less rival and less excludable. My MP3 files are available to anyone in the world running Napster. Songs can be found and copied with ease. The symbolic end of rivalry comes when I am playing the song in Chapel Hill, North Carolina, at the very moment that you are both downloading and listening to it in Kazakhstan—now that is nonrival. 21

THE LOGIC OF PERFECT CONTROL 22

My point is that there is a teleology—a theory about how intellectual property law must develop historically—hidden inside the argument I call the Internet Threat. The argument, which is touted endlessly by the content industries—and not without reason—can be reduced to this: The strength of intellectual property rights must vary inversely with the cost of copying. With high copying costs, one needs weak intellectual property rights if any at all. To deal with the monk-copyist, we need no copyright because physical control of the manuscript is enough. What does it matter if I say I will copy your manuscript, if I must do it by hand? How will this present a threat to you? There is no need to create a legal right to exclude others from copying, no need for a "copy right." As copying costs fall, however, the need to exclude increases. To deal with the Gutenberg press, we need the Statute of Anne—the first copyright statute—and the long evolution of copyright it ushered in. 23

But then comes the Internet. To deal with the Internet, we need the Digital Millennium Copyright Act,13 the No Electronic Theft Act,14 the Sonny Bono Copyright Term Extension Act,15 and perhaps even the Collections of Information Antipiracy Act.16 As copying costs approach zero, intellectual property rights must approach perfect control. We must strengthen the rights, lengthen the term of the rights, increase the penalties, and make noncommercial illicit copying a crime. We must move outside the traditional realm of copyright altogether to regulate the technology around the copyrighted material. Companies are surrounding their digital materials with digital fences. We must make it a violation of the law to cut those digital fences, even if you do so to make a "fair use" of the material on the other side. We must prohibit the making of things that can be used as fence-cutters—a prospect that worries researchers on encryption. In the long run, we must get rid of the troublesome anonymity of the Internet, requiring each computer to have an individual ID. We must make click-wrap contracts enforceable, even on third parties, even when you cannot read them before clicking—so that you never actually buy the software, music, movies, and e-books you download, merely "license" them for a narrowly defined range of uses. We must create interlocking software and hardware systems that monitor and control the material played on those systems—so that songs can be licensed to particular computers at particular times. Uses that the owners wish to forbid will actually be impossible, whether they are legal or not. 24

In other words, we must make this technology of the Internet, which was hailed as the great "technology of freedom," into a technology of control and surveillance. The possibility of individuals circulating costless perfect digital copies requires it. It would be facile (if tempting) to say we must remake the Internet to make it safe for Britney Spears. The "Internet Threat" argument is that we must remake the Net if we want digital creativity—whether in music or software or movies or e- texts. And since the strength of the property rights varies inversely with the cost of copying, costless copying means that the remade Net must approach perfect control, both in its legal regime and its technical architecture. 25

Like any attractive but misleading argument, the Internet Threat has a lot of truth. Ask the software company producing expensive, specialized computer-assisted design programs costing thousands of dollars what happens when the program is made available on a "warez" site or a peer-to-peer filesharing network. The upstart computer game company pinning its hopes and its capital on a single new game would tell you the same thing. The easy availability of perfect, costless copies is a danger to all kinds of valuable cultural and economic production. The story of the Internet Threat is not wrong, it is simply dramatically incomplete in lots of ways. Here are two of them. 26

Costless Copying Brings Both Costs and Benefits 27

The Internet does lower the cost of copying and thus the cost of illicit copying. Of course, it also lowers the costs of production, distribution, and advertising, and dramatically increases the size of the potential market. Is the net result a loss to rights holders such that we need to increase protection and control in order to maintain a constant level of incentives? A large, leaky market may actually provide more revenue than a small one over which one's control is much stronger. What's more, the same technologies that allow for cheap copying also allow for swift and encyclopedic search engines—the best devices ever invented for detecting illicit copying. What the Net takes away with one hand, it often gives back with the other. Cheaper copying does not merely mean loss, it also means opportunity. Before strengthening intellectual property rights, we would need to know whether the loss was greater than the gain and whether revised business models and new distribution mechanisms could avoid the losses while capturing more of the gains. 28

But wait, surely theft is theft? If the new technologies enable more theft of intellectual property, must we not strengthen the laws in order to deal with the problem? If some new technology led to a rash of car thefts, we might increase police resources and prison sentences, perhaps pass new legislation creating new crimes related to car theft. We would do all of this even if the technology in question gave car owners significant benefits elsewhere. Theft is theft, is it not? 29

The answer in a word is no. Saying "theft is theft" is exactly the error that the Jefferson Warning is supposed to guard against. We should not assume that intellectual property and material property are the same in all regards. The goal of creating the limited monopoly called an intellectual property right is to provide the minimum necessary incentive to encourage the desired level of innovation. Anything extra is deadweight loss. When someone takes your car, they have the car and you do not. When, because of some new technology, someone is able to get access to the MP3 file of your new song, they have the file and so do you. You did not lose the song. What you may have lost is the opportunity to sell the song to that person or to the people with whom they "share" the file. We should not be indifferent to this kind of loss; it is a serious concern. But the fact that a new technology brings economic benefits as well as economic harm to the creation, distribution, and sale of intellectual property products means that we should pause before increasing the level of rights, changing the architecture of our communications networks, creating new crimes, and so on. 30

Remember, many of the things that the content industries were concerned about on the Internet were already illegal, already subject to suit and prosecution. The question is not whether the Internet should be an intellectual property-free zone; it should not be, is not, and never was. The question is whether, when the content industries come asking for additional or new rights, for new penalties, for the criminalization of certain types of technology, we should take into account the gains that the Internet has brought them, as well as the costs, before we accede to their requests. The answer, of course, is that we should. Sadly, we did not. This does not mean that all of the content industries' attempts to strengthen the law are wrong and unnecessary. It means that we do not know whether they are or not. 31

There is a fairly solid tradition in intellectual property policy of what I call "20/20 downside" vision. All of the threats posed by any new technology—the player piano, the jukebox, the photocopier, the VCR, the Internet—are seen with extraordinary clarity. The opportunities, however, particularly those which involve changing a business model or restructuring a market, are dismissed as phantoms. The downside dominates the field, the upside is invisible. The story of video recorders is the best-known example. When video recorders—another technology promising cheaper copying—first appeared, the reaction of movie studios was one of horror. Their business plans relied upon showing movies in theaters and then licensing them to television stations. VCRs and Betamaxes fit nowhere in this plan; they were seen merely as copyright violation devices. Hollywood tried to have them taxed to pay for the losses that would be caused. Their assumption? Cheaper copying demands stronger rights. 32

Having lost that battle, the movie studios tried to have the manufacturers of the recording devices found liable for contributory copyright infringement; liable, in other words, for assisting the copyright violations that could be carried out by the owners of Sony Betamaxes. This, of course, was exactly the same legal claim that would be made in the Napster case. In the Sony case, however, the movie companies lost. The Supreme Court said that recording of TV programs to "time-shift" them to a more convenient hour was a fair use.17 The movie studios' claims were rejected. 33

Freed from the threat of liability, the price of video recorders continued to fall. They flooded consumers' houses at a speed unparalleled until the arrival of the World Wide Web. All these boxes sitting by TVs now cried out for content, content that was provided by an emerging video rental market. Until the triumph of DVDs, the videocassette rental market made up more than 50 percent of the movie industry's revenues.18 Were losses caused by video recorders? To be sure. Some people who might have gone to see a movie in a theater because the TV schedule was inconvenient could instead record the show and watch it later. Videos could even be shared with friends and families—tattered copies of Disney movies recorded from some cable show could be passed on to siblings whose kids have reached the appropriate age. VCRs were also used for copying that was clearly illicit—large-scale duplication and sale of movies by someone other than the rights holder. A cheaper copying technology definitely caused losses. But it also provided substantial gains, gains that far outweighed the losses. Ironically, had the movie companies "won" in the Sony case, they might now be worse off. 34

The Sony story provides us with some useful lessons—first, this 20/20 downside vision is a poor guide to copyright policy. Under its sway, some companies will invariably equate greater control with profit and cheaper copying with loss. They will conclude, sometimes rightly, that their very existence is threatened, and, sometimes wrongly, that the threat is to innovation and culture itself rather than to their particular way of delivering it. They will turn to the legislature and the courts for guarantees that they can go on doing business in the old familiar ways. Normally, the marketplace is supposed to provide correctives to this kind of myopia. Upstart companies, not bound by the habits of the last generation, are supposed to move nimbly to harvest the benefits from the new technology and to outcompete the lumbering dinosaurs. In certain situations, though, competition will not work: 35

* if the dinosaurs are a cartel strong enough to squelch competition; * if they have enlisted the state to make the threatening technology illegal, describing it as a predatory encroachment on the "rights" of the old guard rather than aggressive competition; * if ingrained prejudices are simply so strong that the potential business benefits take years to become apparent; or * if the market has "locked in" on a dominant standard—a technology or an operating system, say—to which new market entrants do not have legal access. 36

In those situations, markets cannot be counted on to self- correct. Unfortunately, and this is a key point, intellectual property policy frequently deals with controversies in which all of these conditions hold true. 37

Let me repeat this point, because it is one of the most important ones in this book. To a political scientist or market analyst, the conditions I have just described sound like a rarely seen perfect storm of legislative and market dysfunction. To an intellectual property scholar, they sound like business as usual. 38

In the case of the VCR wars, none of these factors obtained. The state refused to step in to aid the movie companies by criminalizing the new technology. There were equally powerful companies on the other side of the issue (the consumer electronics companies selling VCRs) who saw this new market as a natural extension of a familiar existing market—audio recorders. There was no dominant proprietary technological standard controlled by the threatened industry that could be used to shut down any threats to their business model. The market was allowed to develop and evolve without premature legal intervention or proprietary technological lockout. Thus we know in this case that the movie companies were wrong, that their claims of impending doom from cheap copies were completely mistaken. The public and, ironically, the industry itself benefited as a result. But the Sony case is the exception rather than the rule. That is why it is so important. If competition and change can be forbidden, we will get relatively few cases that disprove the logic that cheaper copying must always mean stronger rights. The "natural experiments" will never be allowed to happen. They will be squelched by those who see only threat in the technologies that allow cheaper copies and who can persuade legislators or judges to see the world their way. The story line I describe here, the Internet Threat, will become the conventional wisdom. In the process, it will make it much less likely that we will have the evidence needed to refute it. 39

The Holes Matter as Much as the Cheese 40

The Sony case is important in another way. The Supreme Court's decision turned on the judgment that it was a "fair use" under U.S. copyright law for consumers to record television programs for time-shifting purposes. Since fair use comes up numerous times in this book, it is worth pausing for a moment to explain what it is. 41

The content industries like to portray fair use as a narrow and grudging defense against an otherwise valid case for copyright infringement—as if the claim were, "Yes, I trespassed on your land, which was wrong, I admit. But I was starving and looking for food. Please give me a break." This is simply inaccurate. True, fair use is asserted as "an affirmative defense"; that is the way it is brought up in a copyright case. But in U.S. law, fair uses are stated quite clearly to be limitations on the exclusive rights of the copyright holder—uses that were never within the copyright holder's power to prohibit. The defense is not "I trespassed on your land, but I was starving." It is "I did not trespass on your land. I walked on the public road that runs through it, a road you never owned in the first place." When society hands out the right to the copyright holder, it carves out certain areas of use and refuses to hand over control of them. Again, remember the Jefferson Warning. This is not a presumptively absolute property right. It is a conditional grant of a limited and temporary monopoly. One cannot start from the presumption that the rights holder has absolute rights over all possible uses and therefore that any time a citizen makes use of the work in any way, the rights holder is entitled to get paid or to claim "piracy" if he does not get paid. Under the sway of the story line I called the Internet Threat, legislators have lost sight of this point. 42

So what is "fair use"? When I am asked this question by nonlawyers, I offer to show them the actual provision in the copyright act. They recoil, clearly imagining they are about to be shown something the size and complexity of the tax code. Here is the statutory fair use provision in its entirety: 43

Sec. 107. - Limitations on exclusive rights: Fair use

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Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include—

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(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work. 46

The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors. 47

"But this seems quite sensible," people often say, as though they had expected both Byzantine complexity and manifest irrationality. (Perhaps they have had some experience with legal matters after all.) The ones who think about it a little longer realize that these factors cannot be mechanically applied. Look at factor 3, for example. Someone who is making a parody frequently needs to take large chunks of the parodied work. That is the nature of a parody, after all. They might then sell the parody, thus also getting into trouble with factor 1. And what about factor 4? Someone might quote big chunks of my book in a devastating review that ruined any chance the book had of selling well. Come to think of it, even a parody might have a negative effect on the "potential market" for the parodied work. But surely those uses would still be "fair"? (In both instances, the Supreme Court agrees that they are fair uses.) 48

In coming up with these hypothetical problem cases, the copyright novice is probably closer to having a good understanding of the purpose of fair use than many people who have studied it for years. In fact, the novice's questions shed light on all of the exceptions, limitations, and defenses to proprietary rights—the holes in the cheese of intellectual property. The scholar's urge is to find one theory that explains all the possible applications of the fair use doctrine, to arrange all of the cases like targets and shoot a single arrow through all of them. Perhaps fair use is designed to reduce the difficulty of clearing rights when it would be uneconomical or impossibly complex to do so: to reduce the paperwork, hassle, delay, ignorance, and aggravation that economists refer to under the sanguine name of "transaction costs."19 (Though the idea that fair use is about transaction costs hardly explains some of the types of fair use we care most about—the rights to parody, to criticize, to reverse engineer.) Or perhaps fair use allows the rights of a transformative author to be trumped only by a second transformative author, who is building on the first—the parodist, reviewer, collage artist, or what have you.20 (Then again, photocopying for classroom use does not sound very "transformative.") Could fair use be dictated by the Constitution or by international free speech guarantees? In this view, fair use provides a safety valve that allows copyright to coexist with the First Amendment, property rights over speech to coexist with freedom of expression.21 After all, it is not entirely obvious how it could be constitutional to forbid me, in the name of a federal law, from translating Mein Kampf in order to warn of the dangers of fascism or parodying some piece of art to subversive effect. 49

Each of these ideas about fair use has much to recommend it, as do the many other grand theories that have been offered to explain the puzzle. And therein lies the problem. 50

Intellectual property is a brilliant social invention which presents us with great benefits but also with a multitude of dangers: 51

1. the danger that the monopoly is unnecessary to produce the innovation, or that it is broader or lasts for longer than is necessary to encourage future production;

2. that overly broad rights will chill speech, criticism, or scientific progress;

3. that it will restrict access in ways that discourage "follow- on" innovation;

4. that it will lead to industry concentration in a way that hurts consumers or citizens while being less subject to antitrust regulation precisely because the monopoly or oligopoly rests on intellectual property rights;

5. that it will establish strong "network effects" which cause the market to tip over to some inefficient technology; and

6. that it will give the rights holder control over some technology outside the range of the monopoly but closely linked to it. 52

The list of dangers goes on and on, and so does the list of exceptions, limitations, and restraints designed to prevent them. We restrict the length of intellectual property rights. (At least, we used to. The framers thought it so important to do so that they put the need to have a limited term in the Constitution itself; nevertheless both Congress and the Supreme Court seem to have given up on that one.) We restrict the scope of intellectual property rights, so that they cannot cover raw facts or general ideas, only the range of innovation and expression in between. (At least, we used to. Developments in database protection, gene patents, and business method patents are clearly eroding those walls.) As with fair use, we impose limitations on the rights when we hand them out in the first place. The exclusive right conferred by copyright does not include the right to prevent criticism, parody, classroom copying, decompilation of computer programs, and so on. (Though as the next chapter shows, a number of recent legal changes mean that the practical ability to exercise fair use rights is seriously threatened.) 53

These limitations on intellectual property do not fit a single theory, unless that theory is "avoiding the multiple and evolving dangers of intellectual property itself." Even a single limitation such as fair use clearly responds to many different concerns about the dangers of intellectual property rights. Indeed it will evolve to fit new circumstances. When computer programs were first clearly covered by copyright law, software engineers wondered if this would cripple the industry. Why? Anyone who wishes to compete with a dominant program needs to "decompile" it in order to make their program "interoperable," or simply better. For example, a new word processing program, no matter how good, would be dead on arrival unless it could read all the files people had created with the old, dominant word processing software. But to do this, the engineers at the upstart company would have to take apart their competitor's program. In the process they would have to create temporary copies of the old program, even though the final product—the hot new software—would be completely different from the old. Would this be a violation of copyright law? 54

In a series of remarkable and far-seeing cases involving such issues, the courts said no.22 "Decompilation" was fair use. The law of fair use had evolved in the context of expressive, nonfunctional, stand-alone works such as books, poems, songs. Now it was being applied to a functional product whose economics depended strongly on "network effects"—many types of programs are useful only if they are widely used. Without interoperability, we could never take our existing documents or spreadsheets or datasets and move to a new program, even if it was better. One program would not be able to read the files created by another. It would be as if language itself had been copyrighted. To have said that the incidental copies created in the process of decompiling software were actually infringements of copyright would have turned the law on its head because of a technological accident (you needed temporarily to "copy" the programs in order to understand how they worked and make yours work with them) and a legal accident (copyright was now being used to regulate functional articles of commerce: "machines" made of binary code). The difference between copying and reading, or copying and understanding, had changed because of the technology. The context had changed because the law was being stretched to cover new types of products, whose economics were very different from those of novels. Rather than let the dominant software companies use copyright to stop others from making interoperable software, the courts used an escape hatch—fair use—to prevent that danger and to uphold the basic goal of copyright: encouraging progress in science and the useful arts. 55

This long story is told to make a simple point. The variegated and evolving limitations on intellectual property are as important as the rights they constrain, curtail, and define. The holes matter as much as the cheese. 56

What does this have to do with the Sony case? In that case, remember, the Supreme Court had said that copying TV shows in order to time-shift was fair use. The Court could simply have stopped there. It could have said, "since most of what consumers do is legal, there can be no claim of contributory or vicarious infringement. Sony is not contributing to infringement since consumers are not infringing copyright by copying shows in the first place." Interestingly, though this is the heart of the ruling, the court went further. It quoted some seemingly unrelated patent law doctrine on contributory infringement: "A finding of contributory infringement does not, of course, remove the article from the market altogether; it does, however, give the patentee effective control over the sale of that item. Indeed, a finding of contributory infringement is normally the functional equivalent of holding that the disputed article is within the monopoly granted to the patentee." Clearly, the Justices were concerned that, by using copyright law, the movie studios could actually get control of a new technology. 57

The fact that the Court expressed this concern through an analogy to patent law was, at first sight, fairly surprising. Courts do not normally look at copyrights in quite the same way as they look at patents. For one thing, patent rights are stronger, though they are harder to obtain and last for a shorter period of time. For another, while courts often express concern about the dangers of a patent-driven monopoly over a particular technology, it is strange to see that concern in the context of copyright law. An unnecessary monopoly over a plow or a grain elevator may, as Jefferson pointed out, slow technological development. But a monopoly over Snow White or "Ode on a Grecian Urn"? We do not normally think of rights over expression (the realm of copyright) threatening to sweep within their ambit an entire new technological invention (the realm of patent). 58

But in the Sony case, the Supreme Court quite clearly saw that, in a world where technological developments made copying easier, the idea of contributory infringement in copyright could be used to suppress or control entire technologies that seemed, in the logic of 20/20 downside vision, to pose a threat to the copyright holder. Indeed, in some sense, the logic behind the Internet Threat—"cheaper copying requires greater control"—demands this result, though the Sony case antedates the World Wide Web by a considerable time. If it is cheap copying itself that poses the threat, then the content owners will increasingly move to gain control over the technologies of cheap copying, using copyright as their stalking horse. That is why the Sony Court went beyond the simple ruling on fair use to explain the consequences of the movie companies' claim. In a footnote (the place where judges often bury their most trenchant asides) the Court was almost snide: 59

It seems extraordinary to suggest that the Copyright Act confers upon all copyright owners collectively, much less the two respondents in this case, the exclusive right to distribute VTR's [Video Tape Recorders] simply because they may be used to infringe copyrights. That, however, is the logical implication of their claim. The request for an injunction below indicates that respondents seek, in effect, to declare VTR's contraband. Their suggestion in this Court that a continuing royalty pursuant to a judicially created compulsory license would be an acceptable remedy merely indicates that respondents, for their part, would be willing to license their claimed monopoly interest in VTR's to Sony in return for a royalty.23

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The real heart of the Sony case is not that "time-shifting" of TV programs is fair use. It is an altogether deeper principle with implications for all of the holes in the intellectual property cheese. The Sony Court declared that because video recorders were capable of substantial noninfringing uses, the manufacturers of those devices were not guilty of contributory infringement. If the rights of copyright holders were absolute, if they had the authority to prohibit any activity that appeared to pose a threat to their current business model, then it is quite possible that video recorders would have been guilty of contributory infringement. It is because we have, and need, multiple exceptions and limitations on intellectual property that the Supreme Court was able to resist the claim that copyright itself forbids technologies of cheaper copying. To put it another way, without a robust set of exceptions and limitations on copyright, the idea that cheaper copying requires greater control will inexorably drive us toward the position that the technologies of cheaper reproduction must be put under the governance of copyright holders. 61

Thus we have a corollary to the Jefferson Warning—call it the Sony Axiom: cheaper copying makes the limitations on copyright more rather than less important. Without those limitations, copyright law will bloat and metastasize into a claim of monopoly, or at least control, over the very architectures of our communications technology. And that is exactly where the logic of the Internet Threat is taking us today. 62

FROM NAPSTER TO GROKSTER 63

Seventeen years after the Sony decision, another court had to deal with a suit by outraged copyright holders against the creators of a technology that allowed individuals to copy material cheaply and easily. The suit was called A&M Records v. Napster.24 Napster was a "peer-to-peer" file sharing system. The files were not kept on some huge central server. Instead, there was a central directory—think of a telephone directory—which contained a constantly updated list of the addresses of individual computers and the files they contained. Anyone who had the software could query the central registry to find a file's location and then establish a direct computer-to-computer connection—anywhere in the world—with the person who had the file they desired. This decentralized design meant the system was extremely "robust," very fast, and of nearly infinite capacity. Using this technology, tens of millions of people around the world were "sharing" music, an activity which record companies quite understandably viewed as simple theft. In fact, it would be hard to think of a situation that illustrated the Internet Threat better. The case ended up in front of the U.S. Court of Appeals for the Ninth Circuit, which hears cases in an area that includes California and thus has decided a lot of copyright cases over the years. 64

There was an irony here. When the Supreme Court decided the Sony case, it was on appeal from the Ninth Circuit Court of Appeals. Sony, with its rule about reproductive technologies with substantial noninfringing uses, reversed the appeals court decision. The Supreme Court was, in effect, telling the Ninth Circuit that it was wrong, that its ruling would have required the "extraordinary" (legal shorthand for "stupid") conclusion that copyright law gave copyright holders a veto on new technology. In the process, the Supreme Court told the Ninth Circuit that it also did not understand the law of fair use, or the freedom that should be given to individuals to make "noncommercial" private copies. The identities of the judges had changed, but now, seventeen years later, the same Circuit Court had another high-profile case on exactly the same issues. In case any of the judges might have missed this irony, it took David Boies, the lawyer for Napster, about ninety seconds to remind them in his oral argument. "This court," he said, adding as if in afterthought, "in the decision that the Supreme Court ultimately reversed in Sony. . . ."25 To the laypeople in the audience it probably just seemed like another piece of legal droning. But to the lawyers in the room the message was quite clear. "The last time you got a case about a major new technology of consumer reproduction, you really screwed it up. Hope you can do better this time." The judges' mouths quirked—not entirely in pleasure. The point had been registered. 65

Think for a moment of the dilemma in which the court had been placed. On the one hand, you had tens of millions of people "sharing" music files and Napster was the service that allowed them to do it. If this was not contributory copyright infringement, what was? On the other hand, Napster seemed to fit very nicely under the rule announced in the Sony case. 66