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Tuesday, October 27, 2009

The DVD Rental Window: Fiddling while Moral Panics and the Copyright Wars Burns.
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It's been a rough month for William Patry's new book Moral Panics and the Copyright Wars ("Copyright Wars"). Negative reviews highlighting some of its profound defects can be found here, here, here, here, and here. More will follow. Worse yet, the book's associated blog, Moral Panics and the Copyright Wars, seems to have ceased providing substantive replies to douse the flames--just some ongoing fiddling.

For example, Mr. Patry's latest post fails to reply to any critique of his book. Among many other fundamental concerns, it thus fails to refute claims that American creative industries are "innovative" and that data-mining, file-sharing pedophiles are a grim reality--not some illusory "moral panic" "conjured up" by that "master of moral panics," Jack Valenti (p. 139).

Instead, the blog has merely resumed the book's complaints, (pp. 154-58), about DVD rentals. In Denying DVD consumers what they want, Patry reported that Netflix, (a content distributor) and movie studios (content creators), are considering delaying the rental window for a given DVD until two weeks after retail sales of that DVD begin. He thus concluded, "The only ones out of luck are consumers."

That claim may even seem plausible. After all, how could the even the Grokster/Lessig/pedophile-denying Mr. Patry stumble by posing as a Champion of Consumers so exquisitely sensitive that even a two-week delay in the opening of the DVD-rental "window" could move him to lamentation?

Easily, it turns out. Dishonesty can shatter any argument; it is the fundamental defect of Copyright Wars; and it inflicts its usual consequences here. Consequently, this seemingly can't-lose argument merely re-affirms a fundamental flaw that pervades the Copyright Wars book and blog.

Innovative content creators like movie studios can only prosper if they create innovative works that others like and then distribute them on terms that others find mutually beneficial. Innovative content distributors like Netflix can only prosper if they rent innovative works created by others on terms that make rental particularly attractive to many other people. Consequently, both creators and and Netflix lose unless they collectively provide a rental solution that consumers like. Nevertheless, Patry claims us that if both creators and distributors like Netflix favor a two-week window between DVD release and rental release, then consumers must be "out of luck."

That seems highly unlikely. Unlike Netflix and movie studios, commentators like Mr. Patry or I do not lose money if we miscalculate the interests of consumers who might rent--but not buy--DVDs. Consequently, the commentator who declares that he perceives the true interests of DVD-renters better than a business-on-the-line entity like Netflix must either possess compelling evidence or be possessed by blinding hubris. For the two reasons discussed below, the "compelling-evidence" hypothesis seems improbable in this case.

Rental services like Netflix prove that DVD players are not broken: Any commentator posing as a champion of consumers in the film-rental market must refrain from decreeing that no such market should exist. Copyright Wars failed this acid test when it decreed that DVD players are broken unless they--like CD players and personal computers--have a "record" button, (pp. 166-167). (NB: I know that many modern DVD burners do have "record" buttons; for these purposes, they are less relevant.)

DVDs and DVD players rank among the most rapidly and widely adopted consumer products in history. Consequently, any competent commentator should carefully inventory his own home-electronic equipment before decreeing that these innovations happily purchased by so many people were hopelessly defective. For example, I would not knowingly buy defective electronic equipment, yet I knowingly bought at least four DVD players without "record" buttons.

Moreover, such implausible claims become particularly problematic if we focus on DVD-rental. Cassette stereos, CD burners and personal computers certainly do have record buttons, but--not coincidentally--copyright laws grant the owners of copyrights in sound recordings and computer programs rights to prevent commercial rental of such works, rights that they usually exercise, subject to narrow, expensive exceptions. See U.S. Copyright Office, DMCA Section 104 Report, at 25 (2001).

Consequently, the market for DVD rentals exists, in part, because DVD players do not enable (most) persons briefly "renting" a copy of a popular film to easily acquire a permanent, perfect, digital copy of the "rented" film. Renting a film for a fraction of the cost of buying a permanent copy is an obvious advantage to consumers. Perhaps that is why most consumers were less traumatized than Mr. Patry by the design of their DVD players and the encryption on their DVDs. (Naturally, Mr. Patry--like every other DRM critic except EFF--somehow fails to be traumatized by the legally protected encryption used by content distributors, like cable and satellite television systems.)

Authors who sell copies of their books only in expensive hardcover or electronic versions cannot fairly condemn Netflix: On his blog, consumer-champion Patry bewails the "classic tiered release schedule for movies." But the resulting hypocritical lecture about a two-week delay of the film-rental window overlooks a brute fact: Were his book really successful, Mr. Patry would gleefully spend a year denying his wisdom to price-conscious consumers who would prefer a cheaper paperback copy.

As always, I must be clear: I am not suggesting that the publishing-industry practice of "tiered" hardcover and paperback releases actually harms consumers. To the contrary: I benefit from it routinely, and I am grateful to the publishers and authors who have made so much careful thought available in diverse formats at such remarkably low prices. Indeed, as with DVD sales/rentals, the hardcover/paperback "tiers" enable entrepreneurial publishers or studios to recover the costs of their risky investments from their infrequent successes while reducing the costs of theirs works to consumers who are interested and less time-sensitive--but hardly "out of luck."

Rather, I am merely suggesting--again--that Mr. Patry's anger seems to be obstructing critical thought. Again, he seems to be trying to plunge his rhetorical spear into the grave of the late Jack Valenti. But again, he seems to have succeeded only in plunging his spear into his hapless publisher, The Oxford University Press. (Interestingly, Copyright Wars found its publisher in England--one of many European originators of the formality-free, three-generation copyright protection that Copyright Wars declared a "grave mistake" (p.77)).

In other words, all content industries employ versions of the "classic tiered release schedule for movies"--even British university publishers. Consequently, should Patry's blog post convince consumers to become so traumatized by a two-week delay in the DVD rental window that they want to buy Moral Panics and the Copyright Wars--albeit as a paperback--then those consumers will suffer the greater trauma of a wait that lasts far longer than a mere two weeks.

For example, yesterday at Amazon, Professor Lessig's book Free Culture was available for $10.88 in paperback; $9.99 in an electronic version, and $25.00 in hardback--and for the "family on a budget," it is also available as a free download from the author. By contrast, Moral Panics and the Copyright Wars was available only in a $21.56 hardcover and a $16.47 electronic version.

Seemingly oblivious to the irony, the author of an expensive hardcover-only book thus concludes his blog post with some affected weeping about the "counterproductive" "squeezing" that a two-week delay in the opening of the DVD-rental window will inflict upon the "family on a budget" that decides, on impulse, to rent some once-popular movie from a Redbox kiosk at the grocery store. Those who seek to understand--rather than find any excuse to condemn--should see why such otherwise non-moviegoing, impulse-renting families should be particularly unlikely to be materially affected by a potential brief delay in the opening of the DVD-rental window.

In conclusion, arguments like these merely re-affirm my claim that Moral Panics and the Copyright Wars is a deeply biased book--one not worth the finite time of a thoughtful reader.

posted by Thomas Sydnor @ 3:05 PM | Copyright , Cyber-Security , E-commerce , Googlephobia , IP , Internet , Mass Media

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