Three days ago, a 2004 BBC documentary on the life of 16th century composer William Byrd was listed by Amazon with a sales rank lower than 110,000. Who even knew it existed?
Yesterday, the sales rank was 11,000 — having shot up 100,000 points.
Why and how? It was put online by someone, but not the BBC, and widely linked, to the cheers of everyone involved in the production but probably to the annoyance of the IP owners. The lesson is one that bears repeating again and again. The enemy of commercial success is not piracy; it is obscurity.
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The BBC is a statist monolith with what has been described as a liberal (read socialist) bias. To be fair it’s still my favourite TV channel and has my favourite news website but I resent having to cough up 140 quid a year to the BBC just to be able to watch TV.
“The enemy of commercial success is not piracy; it is obscurity.”
The first law of Tuckernomics is “Give it away for free and make a profit on the volume.”
“Give it away for free and make a profit on the volume.”
Actually no-thing is being given away for free. The whole point is sales of the thing have increased. If it was being given away for free then the concept of a sale wouldn’t apply.
My server is now seeding the content that Mises made available for free. The most popular download is the books. I see the books going all over the world. Poland, Bosnia, Singapore, India, Philipines, Great Britan, New Zeland, Australia, USA, and on and on.
It would be interesting to see if the sales of the books offered up by Mises increases….
What a shame poor William Byrd can not profit from his success.
Asking why and how the video sales increased so much is a very good pair of questions. I agree that the “why” is because someone posted the video on-line and gave it more notoriety. But the “how” may not be so straight forward.
It is simplistic to assume that merely publicizing the video led to increased sales when it was available for free. We could argue that people bought it for the convenience of viewing it on different media in more comfortable circumstances. We could argue that merely knowing about it caused people to want to pay for it. I think both of these lines of argument are specious.
It is a perfectly good alternative argument that a large number of people chose to pay for the video because they respect the intellectual property rights of the creators or their assigned owners. Unlike some people who do not recognize the virtue of intellectual property rights, many people will pay the requested price if they want something even if they could steal it with impunity.
Let us not mistake honesty and integrity as a proof that intellectual property rights do not matter. Any logical argument we develop about rights should take account of whether public virtue is an intrinsic component of behavior.
There is no such thing as bad publicity. Putting a pirated version of intellectual property in front of an audience will increase awareness and concomitantly increase sales among interested customers with integrity. That does nothing to advance the argument that removing protections for intellectual property will increase sales or maintain incentives to produce intangible works of thought.
It is entirely reasonable that eliminating intellectual property protections could result in a world where everyone chooses not to pay and few if any creators continue to create. I can envision a world where the arts, music, and literature decay away because those talents are put to work in paying professions.
It is one thing to wax eloquent about the costs or benefits to society as a whole, but the profit incentive affects the individual. Few individuals make sacrifices for the good of society, but almost everyone understands that they better do what pays. The division of labor depends upon social cooperation and an agreement to respect property. Society can only expect to get the kind of property its citizens know will be respected. If there is no respect for intellectual property, you can bet there won’t be much of it produced.
but the creators, actors, singers, produces–everyone but the lawyer at the BBC–favors having it online!
“but the creators, actors, singers, produces–everyone but the lawyer at the BBC–favors having it online!”
So for example if the workers at GM “favor” it being nationalized, then it should be done?
How is allowing people to view something on the internet for free while still offering the option to sell hard copies by the direct producer comparable to nationalization?
“How is allowing people to view something on the internet for free while still offering the option to sell hard copies by the direct producer comparable to nationalization?”
That’s obviously not the comparison I was making. I’m was saying that if the wishes of the employees rather than the owners is the criterion for the disposition of a company’s product then let’s apply the same idea in other cases and see how you like them apples.
It has nothing to do with IP. Tucker is just saying that if the employees have some idea of doing whatever the hell they want in violation of their employment contracts then that’s just fine.
Too right!
I’ve tried in vain to find a copy of the CBS TV drama starring Jimmy Smits and Hallie Berry http://www.imdb.com/title/tt0114490/
(based on the Solomon and Sheba bible blockbusters of old) legally by pay per view, on VHS or DVD at eBay or even on loan from a library, heck I couldn’t even pirate it as a bittorrent, no-one’s seen it, even less seeded it…!
Stimulus anyone? I’d like to invest in such ‘modern’ media to appeal to the church teens I teach with ‘stars’ that they will recognize not the heirloom variety, Yul Brynner, of their grandparents generation (whose ’59 version is one of the films included in “The Fifty Worst Films of All Time [and how they got that way]” by Harry Medved and Randy Lowell.)
The IMDB sidebar asks pertly “Own the rights?” since they surely could find a way to make money on it if someone would permit them to purvey it!
“if the workers at GM ‘favor’ it being nationalized, then it should be done?”
OMG – Where the hell do some people learn to debate!?! That is so random.
Take your ritalin, and focus! Nationalization is a different matter entirely. Government intervention, and coercion, doesn’t even compare to the idea of giving people samples of their wares to increase sales….except that the govt will cause monopolies, and eliminate choice. If the product is good, the price is fair, and the means available, the product will be purchased.
Regardless of govt favoritism, this strategy has proven successful at increasing product sales the world over for centuries. IP…still pretty young concept. RIAA,, and MPAA are lazy lawyer scoundrel, make-money-for-nothing, unionized slush funds. The people who wrote the IP often are not the creative geniuses behind the discovery. They are just idiots with legalese know-how, who use govt, and it’s laws as they tools they are. Those fools add no value to the product itself. They are just doing busy work. The artists, and engineers are the ones who should receive the compensation.
See how you like IP when Monsanto sues you because they own the IP for the seed, on plant that randomly grew in your back yard.
This IP busy-work will only stifle true creativity, and innovation.
I yield the soap-box
@David Spellman
Copyright was not invented to subsidize creation, it was invented to subsidize distribution — which it did a decent job of, when distribution (printing presses, etc) was the major expense in making a work available. Those days are obviously over.
A state-granted monopoly on distribution is not a moral right (re your phrase “interested customers with integrity”). It is a policy, and one we can change if it’s not serving us well. It arose with the press, not earlier, and will probably go away with the rise of the Internet.
karl fogel says:
“Copyright was not invented to subsidize creation, it was invented to subsidize distribution…”
not quite. the statute of anne’s purpose was to exercise monarchical control over seditious or ideologically unpalatable literary works. distribution was only the willing tool for this exercise.
@newsome:
(Thanks for the quote
).
I think your latter assertion is half-true… It’s a subtle point; let me explain.
The various laws (Stationers Company charter, the Licensing Acts, etc) that preceded the Statute of Anne were explicitly designed to be an efficient system of censorship, and they were effective at it, since they granted a private monopoly that created a commercial class that benefited from the censorship. It’s also true that the system later set up by the Statute of Anne mirrored, in many ways, the per-printer monopoly scheme and the informal copyrights that the Stationers had observed among themselves during the censorship era.
However, the Statute of Anne was largely a reaction *against* the earlier censorship. By placing the copyright’s origin with the author, rather than with the crown, and by limiting the term of the copyright and the powers of the printers to enforce it, Parliament was partly trying to prevent a recurrence of the control of political speech that had been the case under the earlier regime. (The politics of the so-called Glorious Revolution of 1688 have a lot to do with the shape of this earliest copyright statute.)
So it was those earlier acts whose purpose was “to exercise monarchical control over seditious or ideologically unpalatable literary works.” But I think the part about distribution being key is spot-on: the Statute of Anne was designed to safeguard the printing industry in the *absence* of censorship — remember, this was a novel idea at the time, and no one was quite sure how the economics would work out.
A good blog post about this is here:
http://gabriellacoleman.org/blog/?p=1936
(I commented there with a minor point, but I still think Prof. Coleman’s observations are excellent.)
david spellman says:
“It is a perfectly good alternative argument that a large number of people chose to pay for the video because they respect the intellectual property rights of the creators or their assigned owners.”
but how to explain the timing? tucker’s presented a possible cause of the sudden sales-spike, where’s yours?
also, who is the victim of this instance of piracy?
Sounds to me like BBC owes someone some commissions for their marketing skills. 10% of increased sales revenue sounds about right to me.
If I make a written/audio/video work of some sort I intend to copyright and then sell copies of that work so that I can make money from sale of my work. If someone buys my work, copies it and gives it away or “shares” it on a P2P basis then I haven’t received any money from that transmittal of my work. I have been robbed. The 8th Commandment forbids whatsoever does, or may unjustly hinder, my own or my neighbors wealth or outward estate.
I have right to do what I will with my copyrighted work. It is my property and I created it. Therefore, I control the sale, distribution or altering of the work. Anyone that takes my work without paying for it is stealing.
Incredible that it took 3000 years for the 8th commandment to be properly interpreted!
Samuel,
Your argument doesn’t hold water. Consider, for instance, a person who purchases your copyrighted work and then later sells it at a yard-sale, when they no longer want it. Have they stolen from you?
Or, on a more abstract level, imagine that you created a hammer, and make it available for sale. Then, I come along and look at your hammer, take a digital picture of it, and craft an identical hammer of my own. By not paying you, have I stolen from you?
This second example is analogous to the type of Intellectual Property theft that is being discussed here (copying digital files). According to the biblical and classical definitions of “theft”, an object must be physically taken from another person in order for it to be stolen. That is why the entire concept of Intellectual Property had to be developed at all… because that concept wasn’t part of the idea of “theft”, historically.
When a file is copied, digitally, the copyer is simply making a copy of the file on their own physical media… without affecting the original file at all – so nothing has been removed from the original file’s owner. Thus, according to the biblical and classical definitions of “theft”, nothing at all has been stolen.
The better question is why I don’t just produce those DVDs with a DVD burner and then sell them for half the price. I’d have a huge advantage because I don’t have to pay the cost of production, an esp. huge advantage if I tried selling copies of Spider-man 3 or Transformers 2 (in a few months).
It’s possible people might decide to buy their more expensive copies because they want to respect the IP or because they’re afraid of breaking laws buying my copies. But that just proves the point that IP laws do protect artists.
Also, I think its pretty clear that Dreamworks and Paramount would have spent the $200 million on the movie if they knew I could, with impunity, sell their movie on DVD while they tried to sell tickets to see it in theaters. They only made $700 million worldwide when they didn’t have to compete with me, and they may well not even make up $200 million plus opportunity cost when everyone can get quality copies on DVD without worrying about the legality.
Sorry, I clearly meant “would NOT have spent the $200 million.”
to jeff tucker:
any idea how the bible publishing industry approaches copyright? do modern editions avail themselves of the creative commons framework, or what?
to steve:
why should the community at large be taxed to support blockbusters you like?
if ip laws (public subsidization of punishment) didn’t exist, it may mean that the blockbuster model isn’t viable. smaller, pay-to-view products may prevail, or funds may have to be collected in advance, etc.
of course nobody argues that ip doesn’t benefit some artists (bono, steven king etc.), just that it harms many others by raising the barriers to entry (higher publishing costs, studio costs etc.).
I wouldn’t call having a court system public subsidization of anyone, even though clearly some people are going to win and some people are going to lose and some people will rarely be effected by cases.
My point was that no model is viable except artists doing some things in their spare time not expecting to make much money. Anything that becomes popular can easily be–and will be–copied and spread to everyone who wants it. Because there will be nothing wrong and no way to push the P2P trade undeground you won’t see people willing to pay for DVDs or CDs from Amazon, the sellers will be those who have the most effective means of distributing content (e.g. Google since it has huge server clusters or perhaps a Blu-ray fabrication company).
Let the model be applied to drugs too. Suppose that the government didn’t fund basic research or subsidies drug companies and did not enforce patents on drugs. No one would spend the estimated hundreds of millions of dollars to find good drugs unless they could get the money up front. But who would pay for things up front when they could easily free-ride in the future and there is a big risk nothing will even come of the research without who knows how much more money.
There is a possibility that model would be viable to produce blockbusters, but it seems unlikely it would be efficient compared to the current model and again there would be major incentives to free ride. It seems that in effect you are arguing that people will pay the social value for public goods which runs counter to mainstream economics.
to steve:
well, the legal drafting, administration and policing of ip laws cost huge amounts of taxpayers’ money. why should that burden not be borne by the directly interested parties?
the justice system should limit itself to preventing aggression and upholding contracts. artists/innovators are perfectly able to flourish under such a minimal framework.
boldrin and levine’s “against monopoly” deals with pharmaceuticals. if you’re up to having your preconceptions challenged, it’s a good read.
http://www.micheleboldrin.com/research/aim.html
justifying state intervention as a remedy for free-riding is not part of the austrian platform. you may care to read this brief paper:
http://mises.org/journals/jls/5_4/5_4_6.pdf
But the drafting, debate over, and enforcement of every law cost money. Does that mean laws to say, enforce contracts on private property are a subsidy of people who own more physical property? I own a lot less than Donald Trump so maybe that’s justification for why he should pay higher taxes. Perhaps everyone should just have to pay into a pool at the marginal cost (plus a share of fixed costs) if they want protection from the government and the government to enforce their contracts–in that case the rich would clearly be major targets without protection so should pay vastly more (esp. high marginal rates). It sounds awfully close to anarchy though.
I think the point this is that expecting the government to do things it’s supposed to do isn’t asking for a subsidy. Physical and intellectual property holders have the same standing in this sense. When you say “artists/innovators are perfectly able to flourish under such a minimal framework” you’re right, because preventing theft falls under preventing aggression.
(As you probably guessed I lean left and am a positivist, so I don’t like drug company monopolies and I’d be happy to see someone invent a social system where the benefits are shared my equally. Prof. Temin wrote a good book, Reasonable Rx, with some ideas last year. My real question is why right-wingers sometimes emphasize a “God-given”/natural right to own physical things yet then say its impossible to own non-physical things.)
steve says:
“But the drafting, debate over, and enforcement of every law cost money.”
true. and this gives rise to the hoppean solution of private law and enforcement. those who want to take their chances in the lawless lands, good luck. those that wish to, band together and pay for their legal code and policing.
without national policing, ip legislation is unworkable. in fact, for enforcement to work, transnational standards must be observed. this need for centralization of authority goes against the spirit of libertarianism.
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