Monday, May 08, 2006

Paying for TV

The NYT's article on who's paying for tv offered an interesting glimpse at how technology is transforming the way tv programs are funded through advertising and what advertisers are doing to strike back. Something about the article didn't sit right with me though, and I just figured it out.

William Patry points out (here) that the article confuses the copyright argument, unconsciously assisting the effort to have copyright deal with noncopyright issues:
To be clear, then about Sony: the fourth factor analysis of harm to the market for the copyrighted work was a bunch of hoo-ha in that case. The fourth factor concerns ways in which copying of the work itself damages similar or otherwise relevant markets for the particular type of copying done by defendant. The fourth factor most certainly does not concern harm to advertisers, nor does it reach reduced advertising revenues because viewers are not copying or not viewing a third party's works, i.e., the advertisments. Sony, properly understood, did not deal with copying of the works in question at all. Whatever else one thinks about how to deal with the issue of advertising, we should not distort basic principles of fair use, when the real issues lie outside of copyright altogether.
Indeed, the heart of the decision in Sony v. Universal is the following snippet:
The staple article of commerce doctrine must strike a balance between a copyright holder‘s legitimate demand for effective -- not merely symbolic -- protection of the statutory monopoly, and the rights of others freely to engage in substantially unrelated areas of commerce. Accordingly, the sale of copying equipment, like the sale of other articles of commerce, does not constitute contributory infringement if the product is widely used for legitimate, unobjectionable purposes. Indeed, it need merely be capable of substantial noninfringing uses.

The question is thus whether the Betamax is capable of commercially significant noninfringing uses. In order to resolve that question, we need not explore all the different potential uses of the machine and determine whether or not they would constitute infringement... For one potential use of the Betamax plainly satisfies this standard, however it is understood: private, noncommercial time-shifting in the home. It does so both (A) because respondents have no right to prevent other copyright holders from authorizing it for their programs, and (B) because the District Court’s factual findings reveal that even the unauthorized home time-shifting of respondents‘ programs is legitimate fair use.
Though fair use was discussed at some length in the case, any one of the four factors to be considered is not dispositive alone. Rather, the court must strike a balance between the four primary factors and any other it deems imporant in any given case. If a court were to rehear Sony today, even with the data available about DVR as the NYT's article suggests, it should not make much of a difference. Though some of the claims rejected in Sony as unfounded would no longer be so, the general question of significant non-infringing would be the same. The focus would still be on the work being copied and whether they are being exploited in a new market.

I cannot say whether this is more of a problem for advertisers or content creators, but nevertheless, it's fun watching the two groups jockey to preserve their current business models.
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