DarkNet 1: Digital sampling, Proust’s madeleine, and more long tail marketing

Reading JD Lasica’s Darknet, about the clash between digital remix culture and Hollywood’s attempt to lock down content.
In one chapter, Lasica tries to clear rights to snippets of old movies for use in a personal, non-commercial video — the Mummy, Ice Age, Mary Poppins, Treasures of the Sierra Madre — and collects the rejection letters from the major studios.
What a missed opportunity. The studios should permit this as a matter of course. And they should require the inclusion of a little “credits” widget that has a link to rent or buy the whole movie. Little snippets of video have the ability to evoke the memories of the rainy Sunday when the movie was seen first, and the impulse to watch the whole thing.
What better way to stimulate sales of back-catalog content? No cost, and found money. The rejection letters are opposite of direct mail — targeted anti-marketing, designed to repel buying opportunities from primed and eager buyers.
How long will it take “long tail business opportunities” to really hack business models and buy back the law?

Innovation and its discontents, and patent reform

According to this law.com article, Innovation and its Discontents has helped to spur the current drive for patent reform.

Legislators were also spurred into action by a book — “Innovation and Its Discontents: How Our Broken Patent System is Endangering Innovation and Progress, and What to Do About It” — published last year by business professors Adam Jaffe and Josh Lerner.

Stephen Fox, Hewlett-Packard’s deputy general counsel of IP, noted at a conference in San Francisco on Wednesday that members of Congress have been reading it and even marking particular pages.”They’re using it to get a perspective into the patent system,” Fox said. It’s given them “an aha moment — that’s what it’s all about.”

The long tail and the law

I caught Chris Anderson giving a talk on The Long Tail last week. The most interesting part of the talk (for folks who’ve read the Wired Article was the as-yet-unpublished research data showing using various data sets that prove that Long Tail businesses really do shift revenue mix from almost all hits, to a 50/50 mix of hits and niche products.
Several follow-on reflections. As revenue in the entertainment industry gravitates to the Long Tail, how long will it take for Amazon, Netflix, and others to start buying back the law from mass media capture?
A mass media, hit-based business sees its value as selling the same product to as many people as possible. Anything that modifies the product, or seems to displace a sale to an individual is seen as harmful. A “long tail” business sees its value as fostering many revenue-generating niches. Therefore, anything that fosters the creation of new niches and subcommunities is seen as beneficial.
There are at least three legal preferences that are purchased by hit-based companies, and would be modified by “long-tail” companies:
* Long copyright. A “long-tail” business would also be interested in clearing rights on old, back-catalog works for renewed distribution
* Criminalized sharing. A “hit-based” business sees sharing as stealing. A “long-tail” business sees sharing as the building of niches. See Yahoo Music and Grouper for examples in this direction.
* Criminalized remix. A “hit-based” business sees fan-community modifications as stealing. A “long tail” business sees fan community mods as the building of niches, and finds ways to make more money from enthousiastic and creative fans.

The price of democracy

When a region wants to make a decision about whether to provide broadband as a publicly supported service, what better way than to put the matter to a vote?
Here’s what happened last year in an Illinois referendum about deploying a regional fiber network, according to BroadbandReports.com

SBC spent $192,324 on defeating the ballot measure, while Comcast spent $89,740. Fiber for our Future, the community group pushing the initiative, spent $4,325. Not months after the first vote failed, the Illinois area in question saw Comcast rate hikes as high as 33% in some neighborhoods.

Something is seriously wrong with democracy when this can happen. It is old-fashioned to call for free campaign airtime, but I can’t think of a better way to actually rescue democracy from corporate purchase.

The Premiere Patrol

The spine-tingling new cop show — intrepid officers stake out movie theaters, watching for unauthorized taping of movie premieres.
Texas HB 1871 and SB 481 create new crimes for recording movies in a theater. Meanwhile, there are similar bills making their way through Congress right now (S167 / HR 357) and expected to pass easily.
Why is the MPAA trying to get this bill passed at the Federal and State levels? Rumor has it because they were concerned that Federal law enforcement wouldn’t make movie theater stakeouts as high a priority as say, finding terrorists.
Now, I don’t have any sympathy for commercial pirates — people who make money by distributing illegal copies of movies.
But what problem is the MPAA trying to solve here? People are so eager to see their movies that they are willing to record them at theaters.
With a little creativity, the MPAA could solve this problem in other ways. They could make premiers available to bloggers, and provide links to trailer clips. They could take advantage of the power of universe of fans to spread word of mouth about a movie.
The movie industry could do more of what Apple has done, in making an easy, cost-effective way to search, pay for, and download movies. They could digitize back catalogs of content, creating new revenue opportunities for assets that are moldering on shelves.
I really wish that the MPAA put as much money into creative new ways to distribute and promote their product as they do trying to change the legal system to support their existing business model.

Deregulation — the wrong question

I get a visceral reaction to throw the rulebook in the trash, when I have the opportunity to sit through a telecom hearing or read through an analysis of a telecom bill.
When I see nicely-dressed lobbyists arguing in favor of this legal nuance or that, I see “regulatory capture” in action. The regulatory regime has the consequence of giving the industry tremendous power over the regulations that govern it. I imagine a large octopus with its arms wrapped around the legislature.
At the same time, the comments like this by the new FCC Chairman in favor of “deregulation” make me really queasy too. In a market where the largest companies have tremendous power, “deregulation” can mean “I want the government to stop interfering with my monopoly.”
Upon reflection, I think that “deregulation” is the wrong question.
The government has a strong interest in enabling a competitive market and protecting consumers from fraud.
The government does not have an interest in favoring any network technology over another, or censoring cultural content.
The question isn’t whether government should play a dominant role or no role. The right question is what role should government play.

Copyright idiocy of the day

I needed to make a photocopy of my driver’s license and credit card for an internet order where the shipping address was different from the billing address. My home office copy machine is sheetfed, so I need to go out to copy the little pieces of plastic.
So I called the South Congress HEB. Their photocopy machine is behind a service desk. They won’t let me copy my own driver’s license and credit card, because they are “copyrighted”.
A slightly longer trip to Office Depot did the trick.

IP reform is environmentalism, not Marxism

Wharton professor Dan Hunter has written a provocative paper in which Lessig-style free culture activism, open source software, and open spectrum are examined for their relation to Marxism.
The paper concludes that Lessigist IP reform is more like social democracy, which tempers the exploitative excesses of monopoly capitalism with safety nets; whereas the open spectrum and open source movements are more like Marxism, in that they attempt to remove property from the exploitive hands of owners.
I think the paper gets its Marxism wrong. For example, “a commons of any sort is inherently Marxian, even if other types of private property rights still operate within the commons.” Nope. Marxism argues that all property is theft, and all property is to be held in common. And “Marxism isn

Congressman Boucher engages copyfighters on Lessig’s blog

There’s a lively, thoughtful, substantive discussion going on over on the Lessig Blog, where Congressman Rick Boucher is engaged in conversation with the “free culture” crowd, while Lessig is on vacation. The congressman is reading comments throughout the day, and writing thoughtful, informed, reasonable responses, with insights about the political process. Participants are asking good questions and bringing up relevant angles to the discussion of copyright policy and the INDUCE act.
This is the real deal. Congressperson takes a leadership role on an issue, and uses a blog as a way to meet with constituents who are active advocates in the issue area. The blog community of activists is catalyzed by a thought leader.
No “messages”, no flames. Cluetrain live.

Missed business opportunities

During the INDUCE Act hearing, Bainwol of the RIAA countered claims that file-sharing doesn’t decrease music sales.
But, he said holding up a colorful line graph, our sales from hits have declined. Which means sales of mid-list non-hits must be going up.
In other industries, when companies see sales of one type of product declining and sales of another type of product increasing, they switch strategies to focus on the new product category. The recording industry is missing business opportunities that are staring it in the face.
The recording industry instead wants to use the US legal system to maintain their old product mix.