Wednesday, December 19, 2001

The Acid Test for Intellectual Property Once upon a time, people understood that society benefited most when ideas (know in content production circles as "intellectual property") are in the public domain. Since they cost nothing to share, their market is efficient when they're free for everyone to use. In economic terms, ideas achieve Pareto Optimality in the public domain.

It was also understood that some ideas take up front investment to produce. Drug development costs millions of dollars. Novels take hundreds of hours to write. For idea producers to fill an intellectual commons, they must recoup the cost of their investment (otherwise they would never make the investment in the first place). Copyright law empowers the copyright holder to artificially restrict the quantity of the idea (keep it out of the public domain) and so make excess profit on it, this excess profit covering the initial speculative investment.

Therefore the acid test for good intellectual property law is obvious: does this law get ideas into the public domain as quickly as possible?

Let's look at how some copyright laws stack up:

1) Copyright for 14 years. Initially, copyright was only for 14 years (and limited to maps, charts and books). Since producing a creative work takes significant investment, it makes sense to grant the producer some monopoly power over that idea so they can have a return on that investment (and so invest more). 17 years is probably too long in today's world, so something shorter, like 3 years might be better.

2) Copyright for author's lifetime plus 70 years (retroactively extended). This clearly does nothing to enrich the public domain. Extending copyright beyond author's lifetime cannot possibly motivate him to produce more, because he's dead. Neither can retroactive extension, as the idea is already produced. 70 years is criminally long.

3) Patent on drugs. Drugs cost millions of dollars over several years to develop. If they were not patented, this investment would clearly never happen and we would have fewer drugs. This is bad, so drug patents are a good idea. How long should the patent be? For expensive things like drugs, probably a while, and for cheaper things, less time. Whatever it takes to support reasonable investment.

4) Patent on software/business models. Producing valuable software processes or business models must help a company make more money (otherwise they wouldn't be valuable). Since companies try to make more money anyway, these patents just keep ideas out of the public domain. They do not help create new ideas, and so fail the acid test.

5) Voluntary GPL: GPL'd work is copyrighted (well, copylefted) and not in the public domain. Nevertheless, it has many of the benefits of public domain work and therefore is clearly more valuable than proprietary software. Under reasonable copyright, GPL'd work would enter the true public domain in about 3 years. Under current copyright law, since RMS is around 40, Emacs won't enter the public domain until 2112.

6) Mandatory GPL: Software incurs development cost, and the GPL does not allow the producer to make up that cost. Therefore, if all software had to be written under the GPL, we would have less software, which would be bad. This is not a criticism against the "viral" nature of the GPL, which is the only tool defenders of the intellectual commons have to enlarge the public domain in today's oppressive copyright climate, but a criticism against the position that all software must be GPL'd. GPL'd software is better than proprietary software, but proprietary software is better than no software at all (Free Software folks disagree with this last point).

It's not difficult to think intelligently about what copyright law should be (even though the patent office, legislature, and legal profession continue to misunderstand its purpose). Copyright should be a friend to the public domain, and help enrich it with ideas it would not otherwise have. The acid test--"does this law get ideas into the public domain as quickly as possible?"--refocuses the debate on what an idea is and what role it plays in an innovative, efficient society.
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