Intellectual Property 1: Copyright | Audio Transcript

This is Professor Michael Rappa from North Carolina State University in Raleigh, North Carolina, and I’m here to talk about my course, Managing the Digital Enterprise.

Digital technology, in general, and the Internet in particular pose some very interesting opportunities and challenges with respect to how we deal with intellectual property. Virtually everything that we create in the digital world is a form of intellectual property, and as such, is governed under certain laws and conventions that are generally shared around the world. Although these conventions may differ in different countries, generally speaking, most countries have some form of protections for intellectual property.

Now, in the U.S. and in many other places around the world, these include a collection of laws that cover three main areas. One is patents; the second is trademark and the third is copyright. Much of what we create in the digital world falls under one or more of these three areas. For my discussion today, I’d like to focus on copyright.

The U.S. Copyright Office defines copyright as a form of protection provided to authors of original works of authorship, including literary dramatic, musical artistic and certain other intellectual works, both published and unpublished. In the United States, copyright laws give the owner of copyright the exclusive right to reproduce the copyrighted work, to prepare derivative works, to distribute copies of that work to perform the copyrighted work publicly or to display that work publicly, and so one can imagine then copyright covers a very broad terrain of the digital world.

Indeed, you yourself most certainly are an owner of copyright if you are a student and you write papers in your classes or you take notes in class. Unless those notes are verbatim notes of the professor, everything that you write down falls under the regime of copyright in terms of the protections afforded you as the creator of that original work of authorship.

You need not apply for a copyright, although one can register works with the Copyright Office here in the United States, and that registration simply provides some very legally useful verification of your ownership, but even without that registration, you still have certain legal protections, so long as you can demonstrate that you are, in fact, either the author of the original work or have received the rights to that work from the author.

The copyright protection to the owner of an original work of authorship will last for a certain period of duration. This is a point of contention in the United States and debate in terms of how long a copyright should last, and over much of the past several decades, the United States Congress has extended the duration of copyright on a number of different occasions, such that today, it is ordinarily the duration of the author’s life plus an additional 70 years after the author’s death.

After that period of time, the work then enters into the public domain. In the United States, registration of works for copyright is a fairly straightforward thing to do. If you simply visit www.copyright.gov, you’ll find every detail of information you need to essentially do this yourself, and the fee is fairly modest, especially in comparison to other forms of intellectual property protections like trademark and patent, and so it’s certainly worth your time to go and take a look at this and see how it works. Obviously, there are some intricate details, depending on the kind of work it is, whether it’s music or written or some other form of tangible expression.

It’s certainly worth taking a closer look. Clearly, copyright plays a very big role in the area of things like music and film, and to the extent that that’s the case, those tend to dominate the headlines and also tend to dominate the shape and interpretation of these laws because there’s so much at stake in those particular realms.

Copyright plays a very big role in so much of the things that we may create, and especially in a digital format. One thing that’s important to recognize in all this is that although the government affords certain protections with respect to those works within the realm of copyright that it’s up to the creator and owner of those works to, in a sense, enforce those rights to protect their own interests, and so in cases where a copyright owners’ works are infringed upon in some way, it’s really up to that owner to seek redress against the infringing party, and so what’s key to all of this is that copyright provides us protections, but to the extent that we can or cannot afford to enforce those protections, the law may be more or less meaningful to us.

To bring suit against somebody, to prosecute them for infringement, not only is that a fairly costly thing to do, but also the losses in terms of the infringement itself need to be significant enough to outweigh the cost of prosecuting such a case, so for many of us, copyright is a relevant part of many of the things that we create, but for practical purposes, it’s a protection that is easily infringed upon and extremely difficult to enforce, and this is where digital technology really comes up against the law in the sense that digital technologies have made it so much easier to reproduce copyrighted works, identically reproduce such works and to transmit them and distribute them broadly via the Internet, whereby the potential for infringing has greatly, greatly increased.

Now, if you’re a member of a garage band that’s trying to get its music out to an audience, maybe this is all a good thing. The Internet and digital technology provides you now an increasingly less expensive medium for distributing your works throughout the world, but if you’re a brand-name act and you derive a fairly significant amount of income from royalties on the sale of your music or if you’re a movie production studio in Hollywood and you invest $50 million in creating a new movie, then the possibilities that your music or your movies will be downloaded and shared, more or less inexpensively, and with great speed throughout the Internet world; well, that presents a very significant and troubling issue to the owners of that kind of work.

Copyright covers a very broad terrain. It protects everyone who creates original works, but not all works are the same in terms of the investment involved and the monetary value to the creators and investors in those works, and so digital technology presents both an opportunity to do new things and to reach new audiences, but it also represents a challenge with respect to the wide-scale infringement of copyright, especially in situations where that intellectual property has great value to the owners.

This has really been where, in recent years, copyright has become the focal point of a great degree of debate and controversy and litigation with respect to the digital world. Probably most notably with the wide-scale downloading of copyrighted music through systems first like Napster, and then its many followers and descendents.

The sharing of music without any kind of compensation to the copyright owners; in this case, mostly a relatively small number of music production and distribution entities that buy the rights to this music from the artist themselves, and so in the university world, we deal with this issue quite acutely, since students are some of the primary participants in music downloading using university networks and the like.

Copyright has its implications, both for the people who infringe on copyrighted works and also for people who contribute to that infringement, so in the example of universities operating there computer networks where students are involved in downloading music without permission and sharing that music without permission, it presents a potential legal problem, not only to the students themselves, but also to the university, to the extent that the university is knowledgeable in knowing of the infringement itself. It has some responsibilities not to contribute to that infringement.

Now, there’s always been a certain amount of sharing of intellectual property among individuals, so whether it goes back to taping music off of the radio or videotaping things off of the television, there’s a fairly long cultural history of the kind of sharing among friends of music and videos and the like, and there are certain rights afforded to individuals with respect to the usage of intellectual property that fall under what is called Fair Use under U.S. Copyright Law, and a certain amount of confusion caused by digital technology and its evolution in recent years as to what constitutes a fair use, so in an earlier era when someone photocopied or created a Xerox copy of an article from a book or a chapter from a book, this had certain implications to the copyright owner, but certain things were seen as permissible or at least not actively sought or litigated because of the Fair Use clause of the Copyright Law.

Today, a photocopy from a book or a journal is really quite a different thing than a copy of a digital file of that article or music or whatever it might be in the sense that its ability to be reproduced and mass-distributed really presents a potential for a much greater loss to the copyright owner, and so where does the line on fair use fall? What falls under fair use and what sort of goes beyond it is increasingly a question mark in the legal world.

Now, the biggest mistake that most people make when they hear the words “fair use” is that they think it has something to do with the fair use of someone else’s property, and it really has nothing to do with fairness; it’s simply called the Fair Use Clause under the Copyright Act.

For something to be classified as a fair use under Copyright Law, fair use pertains to some various purposes for which the reproduction of a particular work may be considered acceptable, such as criticism, comment, news reporting, teaching, scholarship and/or search. Now, in terms of determining what may be acceptable under fair use, one has to look at a few different things, the first being the purpose and character of that use, including whether such uses of a commercial nature or for a non-profit educational purpose.

Secondly, we need to look at the nature of the copyrighted work. The third is the amount and substantiality of the portion used in relation to the copyrighted work as a whole. For example, copying a chapter from a larger book represents only a relatively modest portion of that book in comparison to say copying the entire book itself.

Fourth, we look into the effect of the use upon the potential market for the value of the copyrighted work, so one can imagine certain kinds of infringements being relatively negligible in terms of the impact on the actual sale of the copyrighted work or licensing of the copyrighted work, but as I pointed out earlier, with something like a major studio movie that can cost $50 million or more to produce, the inability to capture the return on that investment because of a usage or sharing of that work among people on a large scale would not be seen as a fair use at all.

The distinction between fair use and infringement may not be very clear or easily defined, and a lot of this is going to depend on the specifics of the situation and comes out of litigating what an owner may see as infringement. The easily reproducible nature of digital work has, of course, created concern among those who invest enormous sums in the creation of intellectual property like music or movies and has led to the effort to develop technologies to control how those works are distributed or reproduced.

A so-called DRM or Digital Rights Management technologies that are imbedded increasingly within digital works that will restrict what the user can or cannot do with that piece of intellectual property, and so whether it’s the ability to make copies or to move it between different computer systems or the ability to share that work with others and so forth that the Digital Rights Management technology is an attempt for copyright owners and of valuable works to be able to gain some control back over how that work is used and reproduced and transmitted in a digital environment.

DRM technology is certainly not without controversy. Its application in certain areas create restrictions on use that not all consumers feel is appropriate or surprised by and disturbed by because now, they’ve purchased something that, for example, won’t work on their particular operating system, and their inability to migrate that into a different environment can pose legitimate problems for someone who has purchased the item and would like to enjoy it.

I suspect that DRM technology will continue to evolve, but I also would predict that it will continue to cause some degree of controversy and tension between the producers and consumers of popular forms of intellectual property like music and film.

In an effort to help cope and regulate copyright in a digital environment, the United States Congress passed the Digital Millennium Copyright Act in 1998 in hopes of providing some framework, particularly for producers of expensive intellectual property, some additional protections to help them migrate into a digital environment, and there’s one provision in particular within the DMCA, as the Digital Millennium Copyright Act is called, which provides copyright owners with protections against efforts to circumvent DRM technology by users.

The DMCA puts users in terms of some liability of infringement when presented with some kind of protective technology. Any effort to circumvent that technology would potentially be seen as an infringement under the DMCA.

Now, from the perspective of the digital enterprise, your digital assets, to the extent that they hold great value to you, copyright protections may provide a very important means for you to ensure the ability to realize the value from those assets and not have your assets unfairly infringed upon by other parties, and so for the manager of the digital enterprise, it’s important to understand how copyright works in the digital world and what protection it affords you; what kinds of digital assets, as part of your organization, may be protected by copyright, to what extent various kinds of collections of information may or may not fall under the copyright clause itself.

It also requires some degree of consideration to when producing digital works, the circumstances under which those are produced, so as I said earlier, copyright falls to the authors of original works of authorship; however, certain works are commissioned by businesses or by organizations, and they are, therefore, then produced under what might be called a Work for Hire clause, in which case the copyright is owned by the business or individual commissioning the work as opposed to the author themselves.

It requires some degree of awareness and knowledge and appreciation of how copyright law works with respect to how it protects your digital assets, and in the creation of digital assets, to what extent certain kinds of agreements and contracts need to be made in advance to ensure protection of those assets and ownership of those assets.

One area of digital assets in particular, that pertaining to software, also potentially has important implications with respect to copyrighting and the protections afforded by copyright law, and this has spurned a great deal of debate about the nature of software and what are the proper ways in which one might consider protecting that kind of intellectual property and what role copyright plays.

We all know from the emergence of open-source as a means for developing complex software like the Linux system and the growth and the use of what’s called the New Public License, or GPL, as a way of sharing intellectual property in the form of software in a way that provides less restrictions to other users, but kind of guarantees the openness in terms of the freedom of other computer programmers to work with that code and to try to improve that code and to make it better, and so the whole area of intellectual property with respect o digital assets is undergoing an amazing evolution, and some might say transformation with respect to open-source as a framework for thinking about how to, on the one hand, protect but share a complex intellectual product like a piece of software.

I think this is going to continue to evolve and be a topic of discussion and debate and evolution into the future and one which I think is certainly very exciting and has brought implications, maybe even beyond software itself to other kinds of intellectual products. There’s increasingly a movement to create, for example, other forms of educational resources in an open format that uses an open-source metaphor as a means for distribution, and so with any very big and important ideas, I think they become pervasive across a wide spectrum of possibilities in terms of intellectual creations and one that has brought implications for the managers of digital enterprises.

Whether you’re the creator of intellectual property that is afforded certain protections under copyright or you’re a user of intellectual property, you really cannot operate in a digital world; safely, with being ignorant of how copyright laws play a role.

This is Professor Michael Rappa. Until next time, wishing you all the best with your studies.

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Unedited transcript of audio podcast produced on November 18, 2005.

Audio source file: http://digitalenterprise.org/podcasts/copyright.mp3

Michael Rappa is the Alan T. Dickson Distinguished University Professor of Technology Management at North Carolina State University.

For more information, please visit: digitalenterprise.org