
Copyright Act explicitly states disruptive innovation should be blocked - adityab
http://www.techdirt.com/blog/innovation/articles/20120913/23530420381/copyright-act-explicitly-says-disruptive-innovation-should-be-blocked.shtml
======
rayiner
This blog post takes the statutory provision in question wildly out of
context:

> I've read the Copyright Act many times, but have to admit that I'd never
> quite noticed this line from 17 USC 801(b)(1)(D), which explicitly states
> that the role of the Copyright Royalty Judges on the Copyright Royalty Board
> that sets the rates for internet radio are there: To minimize any disruptive
> impact on the structure of the industries involved and on generally
> prevailing industry practices.

This is not referring to the Copyright Act as a whole, but to the purposes of
Copyright Royalty Judges specifically. Here is the whole provision:
<http://www.copyright.gov/title17/92chap8.html>.

What are Copyright Royalty Judges? They're judges who set rates for statutory
licenses. Statutory licenses are _compulsory_ licenses where copyright holders
are obligated to agree to licenses and where rates are set by the Royalty
Board and not by free negotiation between the copyright holder and the
licensee: <http://en.wikipedia.org/wiki/Statutory_license>.

Basically, all this says is that Royalty Judges shouldn't use the compulsory
licensing scheme and their rate-setting powers to disrupt industries. It
doesn't say anything about the copyright law in general preventing the
disruption of industries.

Ironically, this section of the Copyright Act is actually intended to reduce
the ability of copyright holders to use their rights to prevent disruption in
delivery methods: [http://rightsflow.com/resources/copyright-licensing-
resource...](http://rightsflow.com/resources/copyright-licensing-
resources/compulsory-license/)

"Because Congress was concerned about the potential for monopolistic behavior,
it also created a statutory license, section 115 of the law, to allow anyone
to make and distribute a mechanical reproduction of a musical composition
without the consent of the copyright owner provided that the person adhered to
the provisions of the license, most notably paying a statutorily established
royalty to the copyright owner."

~~~
eli
I like Mike Masnick, but this seems like a real miss. He should have gotten a
second source before running it.

~~~
rayiner
The purpose of the compulsory licensing scheme is the public good, to keep
copyright holders from preventing certain socially-beneficial uses. The
"disruption" provision a concession to copyright holders, basically promising
them that the compulsory licensing scheme won't be used to gut their copyright
protections.

I think Masnick's argument is that the Royalty Board should use its rate-
setting powers to make online radio companies like Pandora more competitive.
But Pandora is a for-profit business. Why should the Board give them rates
lower than what they can get by freely negotiating with the copyright holders?

There are a lot of problems with copyright, but they're on the enforcement
side. The streaming radio debate is just about money. Pandora can't make money
selling Indie music. They want to sell Britney Spears, because that's what
consumers want. But they don't like how much money Sony, etc, are charging for
Britney Spears. So they want to force the government to force Sony, etc, to
sell Britney Spears for less money.

~~~
javajosh
I think you are giving Masnick too much credit in his argument. It looks like
he confused general copyright enforcement guidelines with specific compulsory
rate setting guidelines. Sloppy at best, muckraking at worst.

I would be curious to know, though, how often compulsory rates are set and in
what specific circumstances, if you know.

------
btilly
The following sums it up.

 _There is nothing more difficult to take in hand, more perilous to conduct,
or more uncertain in its success, than to take the lead in the introduction of
a new order of things. For the reformer has enemies in all those who profit by
the old order, and only lukewarm defenders in all those who would profit by
the new order, this lukewarmness arising partly from fear of their adversaries
… and partly from the incredulity of mankind, who do not truly believe in
anything new until they have had actual experience of it._ \-- Niccolo
Machiavelli

Politicians looking for donations are trying to follow the path of least
resistance, not most. Hence the rules defend the status quo.

------
nostrademons
Pandora should work with alternative, indie music venues like MySpace or
YouTube to find off-label music acts waiting to be discovered. There're
hundreds of thousands, perhaps millions of amateur musicians in this country
that're waiting to be discovered but can't get the record labels to pay
attention to them. Some of them are quite talented.

If an unknown but good artist showed up in my Pandora stream, I'd love it.
Hell, that's _why I listen to Pandora_ \- to learn about musical groups that I
wouldn't otherwise have heard of. And they already have the algorithms and the
data to distinguish crap from good stuff, at least in theory.

They're potentially sitting on a gold-mine. Just open a self-service webapp
where an amateur musician can upload MP3s of their work and fill out a blurb &
promotional photos, classify their work through the normal music genome
project, and start injecting it into the streams of people willing to listen
to unvetted music. The thumbs up / thumbs down buttons can do the rest.

~~~
ta12121
Maybe, but:

1\. That would make them a record label, rather than a radio station

2\. Most people, myself included, do want to hear established artists.

------
derekp7
After reading this, it seems that this could be a clear case of a law that
should be struck down on constitutional grounds -- Article I section 8, "To
promote the progress of science and useful arts", not "disrupt the progress".

~~~
btown
The full line is "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."

derekp7, I wish that the case was that simple, and that 17 USC 801(b)(1)(d)
would be struck down. I'm afraid it's not that simple, though. IANAL, much
less a constitutional lawyer, but I'll play devil's advocate and look at a
possible rebuttal by the communications industry:

"The existing industries provide a time-tested way of asserting artists'
rights (which itself promotes the progress of 'useful Arts'), by way of
providing a stable system for the collection of royalties, and preventing
distribution of materials, when such distribution is not desired by rights
holders. An entity which seeks to interrupt the continued operation of this
stable system could plausibly _reduce_ the security upon which rights holders
have come to rely. Therefore, Congress is within its rights to _ensure the
survival_ of this system as a means of implementing Article I section 8."

So it's not an open-shut case. The argument would have to be made that
"disrupting the progress" of communications innovators, does more harm than
ensuring the security of existing rights holders does good. I think everyone
reading this site believes that, but I'm afraid it might not hold up legally.

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johnpmayer
Imagine a start-up where you rent a tiny radio receiver, a really tiny
miniature scale radio receiver in a big warehouse in Virginia next to an even
tinier transmitter that you control via a "fan request" API.

So might that count as radio?

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troymc
<joke>Well then, I guess TechCrunch Disrupt is SOL.</joke>

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bediger4000
I'm pretty sure this is a good idea. It keeps the peasants and proles in their
place. It just wouldn't do to have that kind of people receiving new ideas. It
would upset the Ordained Social Order.

