The End of Ownership.

Aaron Perzanowski and Jason Schultz’s book The End of Ownership gives a surprisingly strong argument that our rights as consumers are rapidly being eroded by changes both in the law and in technology, so that we no longer own many things we might believe we do. In the era of digital goods from books and music and movies to software, we are still paying for the same content, but when once we purchased, now we merely “license” – even though most consumers probably aren’t even aware of the change.

For most of the history of commerce, if you bought a good, you got the good, and that was essentially that. If you bought a book, you owned that copy of the book. You were free to do with that copy as you wished, so long as you didn’t make unauthorized copies of it. You could lend it to someone, or you could sell it outright. The owner of the copyright on that book could not stop you from doing any of those things, nor could s/he repossess the book from you for any reason. The same is true of a patented good: if you buy a widget, you can resell the widget, even if the widget itself is covered by a patent. This is known as the “exhaustion principle” or the “first sale doctrine.” (I’m sticking with U.S. domestic laws on intellectual property here; the rules laws on international exhaustion are often less clear.) I own a special green-vinyl edition of A Tribe Called Quest’s single “I Left My Wallet in El Segundo;” I still own that record, but I could lend, sell, or donate it as I please, without the group’s permission, and without affecting ATCQ’s copyright to the underlying work.

In the digital realm, however, this principle has been superseded by licensing agreements – those things you’re given when you download a digital good or install a software update, which you don’t read but you click “Agree” anyway because let’s get on with this already. Those licenses say you don’t own the goods you’re paying for, even though you probably clicked on something that said the word “buy,” which strongly implies a purchase, not a license. Those agreements, known as end-user licensing agreements or EULAs, curtail the consumer’s rights in ways that the consumer may not understand or expect, resulting in an imbalance of information between buyer and seller where the former probably believes he’s acquiring more rights than he actually is, including the rights to make copies of the good for his personal use, and the right to retain the product in perpetuity.

Law professors Perzanowski and Schultz argue that this is a three-pronged problem. One, consumers believe they’re getting something they’re not. Two, companies are unilaterally abrogating rights afforded to consumers by federal and state laws. And three, Congress and federal courts have totally dropped the ball on the entire issue, passing laws that favor content creators at the expense of both consumers and the public good, or issuing contradictory rulings that reduce our rights in ways that consumers don’t understand and that help take away any semblance of ”ownership.”

The authors give copious examples, some of which were truly non-obvious to me. As the so-called “Internet of Things” expands to include more devices that don’t obviously need an internet connection but have one anyway – like the microwave in that Conway twit’s kitchen – then our rights of ownership are also affected. You might own the physical parts of the refrigerator, but you’re only licensing the software on it, so you can’t sell the fridge because you don’t own the whole thing. You may not be able to sell your smartphone for the same reason – the manufacturers can argue that you are only licensing the software on it, which means you own the device but not the entire unit to be able to sell it.

Why is this OK? The authors give the example of a hat that is only licensed to the purchaser, not sold, so the purchaser can’t transfer ownership of the hat via any method to anyone else. Would you buy that hat? Would you even understand the legalese that accompanies it? In another example, the authors pose the hypothetical of “single-use” car tires, which your tire license would prohibit you from repairing once they were damaged or worn out. Consumers have a specific expectation when they purchase something, but when you ‘purchase’ a digital good, those expectations exceed the reality, yet for some reason we accept this loss of purchaser rights in the digital realm without any real pushback.

What about libraries in the digital world? Some publishers, including HarperCollins (mine), have created programs for libraries to buy digital books, but with heavy restrictions on how libraries may lend them out; HarperCollins only allows one ‘copy’ of the book to be on loan at any time, and after a fixed number of borrowings (I think it’s 24), the library’s license to the book must be renewed. The publishers argue that such restrictions are necessary to avoid cannibalizing the market for book sales, and that the restrictions mirror the physical decay of books that are repeatedly handled and borrowed. I can understand the former, but the latter doesn’t hold water for me, since I recently borrowed a book, Martin Flavin’s Pulitzer-winning novel Journey in the Dark, from my local library, and the edition – worn, but intact – dated back to the late 1940s.

The authors do an excellent job of translating thorny legal questions into accessible language, and offer some very specific solutions that Congress could enact to solve many of these problems – and if Congress had ever shown an iota of interest in protecting consumer interests over those of copyright holders, well, I might have some hope. The legislative history of copyright law in the U.S. is essentially all anti-consumer, with copyright terms becoming longer and such laws on digital goods reducing consumer rights even further. The mere concept of copyright was to ensure content creators were sufficiently rewarded so that they’d continue to create – if you can’t make money off your creations, you’ll have to do something else to pay the bills. The concept was not intended to provide such legal protections for two human lifetimes, but that’s about where it stands now, because there are some very big companies out there who depend on long-term copyright protections, and they can spend to ensure that works don’t fall into the public domain when they were originally scheduled to do so. The parade of degradations of consumer rights seem unlikely to cease any time soon, and the end of that path could be the end of ownership.

Next up: Upton Sinclair’s novel Dragon’s Teeth, winner of the 1943 Pulitzer Prize for Fiction.

On copyrights.

A week or so ago I pointed out to reader BSK that his practice of copying CDs to his hard drive and then trading thephysical disks on swaptree was both illegal and unethical. He didn’t accept my argument, so I contacted the Copyright Alliance to get a professional opinion.

The response I received was unequivocal: This practice violates federal copyright law. Excerpts of the reply, interspersed with my comments:

The RIAA explicitly states on their website that this is illegal. (Scroll down to the bottom under “copying CDs”).

The most relevant part on that RIAA link, about copying CDs you own for your personal use: It’s not a personal use – in fact, it’s illegal – to give away the copy or lend it to others for copying.

You may, of course, trade a CD or book or DVD that you own (the “First Sale Doctrine”) as long as you do not make or keep a copy.

But, would someone agree that it is okay to buy a
book, scan it into your computer, and then sell the hard copy? Probably
not (I hope not). So, why is music different? It’s not – the law is the
same for all creative forms. Consumers have asked to be able to buy a CD
or a song from itunes and listen to it in their car, on their computer,
or ipod. So, with music it is generally accepted (though not technically
legal) that one can use music on multiple devices for personal use.

As long as you’re keeping all the copies, you seem to be in the clear.

It is also not legal to download a digital copy of a work and then print
it out or put it on CD and sell that. So, why would the opposite be

Well, it wouldn’t, and I think this is just common sense.

I’ve run into a similar issue with people copying articles found online and pasting them into emails. Again, this is illegal, and no, it is not “fair use” – it is patently UNfair use. (It fails fair use on two grounds – the sender reproduced the entire work, and by reproducing and sending the entire work the sender impacted the market for the work because the recipient no longer has to click on the original site or pay for access to the article.) Pasting a link to the original article is legal. Pasting the entire article is copyright infringement, and while your potatoes are probably too small for the copyright owner to sue you, that doesn’t make it any less illegal. One longtime friend sent me an email like this, and copied so much text that he included the copyright notice at the bottom of the article … but sent it anyway. And he was offended when I objected to the practice.

In addition to being illegal, it’s completely unethical. If you make a copy of a CD, then sell or barter the CD (or even give it away), then two people have use of the copyrighted material while the copyright owner has only been compensated once. Isn’t it obvious that this is wrong?

Final point: BSK argued that this was about “freedom.” We do, in fact, have exceptional freedom in our ability to create, distribute, and purchase copyrighted works in this country today. If you want access to formerly banned books like Huckleberry Finn or The Grapes of Wrath, to hardcore pornography, to Pungent Stench’s Been Caught Buttering (if you’ve seen the album cover, you know what I’m talking about), you’ve got it. That freedom does not mean the freedom to make unlimited copies of these works and sell them or barter them or give them to your friends. We have laws designed to protect the rights of those who create intellectual property so they’ll be financially able to continue to do so. If you don’t like the laws – and I wouldn’t argue that they’re perfect, particularly the ever-increasing time of protection for copyrighted works – try to change them. But don’t steal from the authors and musicians whose works you enjoy.