Apres Napster, Le Deluge

Unless you've been living under a rock this year, you will have heard of Napster, the extremely popular music swapping software program. Napster users, many of them kids and teens, can exchange music in a digital format over the Internet. Recently, the US recording industry obtained an injunction against the Napster site, only to having it stayed on appeal the next day.

That kids are enamoured of Napster, and oblivious to its questionable legality, is perhaps understandable. They are young and don't know any better. What is disconcerting is that a lot of adults think copying digital content over the Internet without paying for it is just fine.

Consider Margaret Wente's recent column in The Globe And Mail (The Napster Generation: Rebels in Cyberspace, July 29, 2000). She draws heavily on an interview with John Perry Barlow who, as early as March 1994, in a seminal article in Wired, argued that copyright law simply no longer works in a digital networked environment.

Barlow argues that copyright has traditionally been connected to paper-based media; so, as information is dephysicalized over the Internet, it can no longer be subject to copyright or other intellectual property systems. As a result, Barlow advocates jettisoning the copyright system altogether, replacing it with a relationship-based structure where creators get paid for their ongoing service and the updating of their information.

While some of Barlow's observations are interesting, much of his approach is dangerous, and we would do well to pause and probe his exhortation for a world free of intellectual property laws. For there are serious flaws with what I will call his "Napster Logic".

Too Many Criminals, So Change the Law

One aspect of Napster Logic is that there are now too many people using Napster-some 20 million at last count-and therefore the law should simply give up trying to do anything about Internet-based copyright infringement.

The rejoinder to Barlow, drawing on an offline highway analogy, would be that it is precisely because automobiles can reach speeds of 200 kilometres an hour that we need speed limits. It is because the Internet enables the copying and transmission of content with an ease, quality and efficiency never before witnessed, that copyright law must rise to the new challenge.

Copyright law is flexible, resilient and able to adapt to technological challenges, just as it has over the last hundred years when confronted with new reproduction and transmission technologies, whether they were photographs, pianola rolls, sound recordings, broadcasting, cable transmissions, cassette recordings, or photocopies. Each one of these devices and media could have proved to be an insurmountable obstacle to the copyright regime, but the statute was amended and we adapted its core principles to new fact and business situations. We can do the same for the Internet.

One approach, for example, might be akin to the "compulsory licensing" response to home copying of music. The problem was the unauthorized reproduction of music off tapes and cassettes. The practice had become so widespread (even more so than Napster today), that the Copyright Act was amended to permit home copying of music for personal use; however, the trade off was a fee levied on each blank CD, cassette and other recording media. This fund is then distributed to the creators of content according to several criteria.

While at first blush compulsory licensing seems like a sensible response to Napster and similar technologies, on further reflection the flaws of such a system become apparent. Most importantly, this approach can be a rather blunt instrument. For example, the Canadian software industry is currently protesting that they must pay the levy on CDs, given that they use blank media not for copying existing works, but for distributing copies of their own software for their paying/authorized customers.

Any Internet-related content levy will meet with even more opposition from the "innocent bystanders". For example, how would the compulsory licensing regime be applied to software? Will the levy be based on each personal computer sold? And given the enormous value of software, will the levy be in the range of several thousands of dollars? If not, many software companies, including smaller Canadian ones, will lose huge amounts of revenue. The software industry would do well to engage in the Napster debate if it wants to protect its vital interests.

Do We Need Copyright At All?

Barlow doesn't object to copyright only on procedural grounds-it's too hard to administer in the Internet age-he also believes we don't need the substance of copyright. Quoted in the Wente article, Barlow states that music won't die without copyright, otherwise how can you "explain Bach, Beethoven, Mozart" (i.e. they wrote lots of music in a pre-copyright age). This is dangerous stuff.

The copyright system promotes the creation of music (and other forms of authorship, such as books and computer software, to name just two) by giving the composer (or author) a period of time during which only he or she can copy, or authorize others to copy, the work. Barlow thinks that without copyright, people would still create music, books, software and other works. Let's test this. Take yourself. You go to work each day for a variety of reasons. You enjoy the comraderie, you like the challenge, you feel fulfilled by the intellectual stimulation, and you get paid. This latter point is important because, however valuable the other elements of psychic income, you have to have real money to house, clothe, feed and entertain yourself (and your family, etc.).

So, would a writer write a book or a software developer develop software if they weren't paid for it; that is, if the moment it was finished, could someone else start making copies of it for their own use and for distribution to others without paying anything to the creator? The answer is no, except in those circumstances where the creator doesn't need the money.

People who are already rich may well continue to work (and create) for free. Even less well-to-do people donate large amounts of time to serve on charities and other volunteer organizations. And then there are people who create and think for a living who already have relatively well paying jobs such that they don't need extra copyright royalties to produce creative works. Many professors fall into this category, as do the many thousands of people around the world helping to develop Linux, the "open source" software that is made freely available for all to use.

Linux exists, however, because the members of the Linux community are drawing comfortable salaries from universities or corporations, and they do Linux part-time. This explains Bach, Beethoven and Mozart. As they did not have a revenue stream from copyright royalties, they had to have rich patrons-whether in the form of the church or members of the aristocracy-who funded their existence (and who forced them, especially poor Amadeus, to write a fair amount of shlock), in order that they could have the "freedom" to write what they really wanted.

So, from this perspective, Barlow is correct. There is indeed another way to provide the means for the creation of works, namely the patron system. In some creative communities, we effectively have a strong element of this already. In Canada, governments were important funders of the arts. One disadvantage of such a system is that artists can be devastated when the patron tightens the purse strings, as has happened over the last 10 years.

In a Barlowian world we wouldn't have private software companies, like Microsoft or Cognos. Software would be created along the lines of the Linux model. Patrons, in the form of universities, governments or large computer user companies who free up some of the time of their staff, would develop all new software.

In effect, in a world without copyright and other intellectual property protection, everyone would contribute their work to a common pool of information, and then draw from it as needed. Hmmmm? Isn't this just like that communal experiment last century which took place in that large part of the world that jettisoned this system last decade, and is still digging out from under the economic rubble caused by a system without private property?

Interestingly, in a case last year, the people who developed the Napster software brought a lawsuit against someone who was threatening to reveal publicly the source code for the software. Napster argued this would put at risk its valuable intellectual property rights. Life is full of delicious ironies.

"It's Really the Profits that Bother Us"

In response to the claim that Napster is helping users pirate music, Wente quotes Barlow as stating that less than four per cent of the revenues of the recording industry are paid to the artists, and therefore the music companies are the real pirates. This is a further element of dangerous Napster Logic, namely, big profitable copyright owners shouldn't mind some diminution in their sales as they will still have lots of money left over. I've often heard this expressed by people who have made illegal copies of Microsoft products-"Bill Gates is the richest man in the world; surely he won't miss a couple of hundred dollars if I don't pay for this software".

This is, in some ways, the most nefarious side to Barlow's argument; essentially, the rich can afford to be robbed. If you support Barlow's position, however, why limit it to software? Computer manufacturers made a lot of money last year. Why not walk into a computer store and just walk out with one of their machines without paying?

Of course we all know the answer-because it's theft, whether or not the company is profitable. It's morally wrong. And if you could do it, the manufacturers would not make any more computers because it would not be worth their while. If you believe in an economy based on private property, you really can't take exception to this logic.

Yet many people do just this type of shoplifting each day over the Internet when they download copyrighted software, music and other content. The only difference between the two activities is it's harder to get caught on the Internet.

I'm not naive. Software like Napster will not disappear, and likely many newer, stronger versions of such software will be developed. But let's also be clear about the users of such software-they are the shoplifters of cyberspace.

George S. Takach is the Head of the High-Tech Law Group at McCarthy Tétrault, the author of Computer Law, and a Special Lecturer in Computer Law at Osgoode Hall Law School.