WASHINGTON – The above headline shouldn’t have to happen. In my panel yesterday here at CISAC’s 2nd World Copyright Summit, I dismissed the false dichotomy of “Hollywood v. Silicon Valley,” but it keeps popping up. This morning CISAC had Consumer Electronics Association CEO Gary Shapiro debate National Music Publishers Association CEO David Israelite. It will be no secret to readers that I sympathize with David’s point of view, and not just because he is a Copyright Alliance member and served on our board in our inaugural year. But I think he would agree that we really should have moved beyond this debate by now.

To Gary’s credit, he hasn’t really been active in this space in the last couple of years, which is good. He did in late 2006 hire a DC public relations firm to launch a site focused on ensuring musical works could be on multiple devices with reduced concerns about licensing, but it appears he let that funding dry up at the end of last year and will next week instead launch a new “grassroots” campaign promoting innovation. Apparently the most innovative country in the world (no offense to my friends in other countries) is seeing its innovation retarded.

Gary didn’t have a lot of examples of this today. He said licensing debates had prevented a satellite radio device capable of recording music off of the satellite stream had been blocked from the market, but moderator Brooks Boliek, a seasoned reporter in this space, pointed out to Gary that he has owned such a device for two years. In full disclosure, I am an XM subscriber and own one as well.

David rightly noted that “our music makes their devices relevant,” and said his concern is that often hardware innovators do not seek to sit down with rightsholders to determine how to move forward legally – as both Gary and David acknowledged happened with the DVD – but instead launch first and speak with rightsholders later, when it’s clear they are facing legal sanctions.

David acknowledged that creative industries haven’t always been quick to adjust to technology. This is undeniably true. Ask anyone who has taken a business class, and you’ll be told that if you have a successful business model, the smart thing is to keep working that business model. There are financial incentives, particularly for publicly traded companies, not to cannibalize your existing model by experimenting with new ones.

But in our digital age it’s clear that longtime business models, while still generating revenues, need to accommodate new models, and those are in fact being rolled out in a legal manner faster than anyone could have imagined a few years ago. David’s music publishers are right in the mix in those rollouts.

Gary had the same talking points he has been using for a decade. The Sony Betamax decision was important. Patents are good, but copyright, also an intellectual property, shouldn’t be accorded the same respect as real property. He even said that because he believes the economic harm from unauthorized file-sharing is lower than estimates, it shouldn’t be relevant to the discussion.
Asked both by David and Brooks if that meant Gary felt unauthorized file-sharing should be legal, he first said: “If legislation is out there I’ll address it.” Pressed, he said: “I’m happy to give an opinion when it’s relevant.” That drew boos from the large audience, international rightsholders who feel it is very relevant to them, if not to consumer electronics manufacturers whose devices store those infringed works.

Gary did say that one way to deter young people (his focus, that of individuals under 25) from infringing file-sharing was education. We agree, which is why we have created a charitable foundation for that purpose, the Copyright Alliance Education Foundation.

I want to make clear that I’ve known Gary for over a decade, and one would be hard-pressed to find a greater champion for his industry. He was a bit tone-deaf today, at times seemingly forgetting his audience (he spent about five minutes saying how the U.S. was the best in just about everything, even though it seems most Summit attendees are from abroad). The business model of his members, by and large, rely heavily on intellectual property in the form of patents but see intellectual property in the form of copyright as a roadblock to deployment. And to an extent he is right.

But rightsholders now, by and large, recognize the critical role Gary’s members can play in distributing legitimate, legal creative works in ways consumers are demanding. David made clear we need to address consumer demand, as has just about every other speaker here. Frankly, I’ve suspected that’s why Gary hasn’t been as vocal the last two years – in my recollection he’s barely touched on copyright in his last two addresses at CES, a major departure from his past – and knowing how knowledgeable he is, he knows the truth in the shift that has occurred with rightsholders.

His message was one from the past, but many of his members are looking to the future, and rightsholders are happy to work with them.

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This entry was posted on Wednesday, June 10th, 2009 at 11:13 am by Patrick Ross and is filed under copyright law, copyright opponents, creators, drm, internet, licensing, p2p, piracy. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.