Newspapers… will… find a way…
Newspapers… will… find a way…
Newspapers… will… find a way…

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    There was a lot of talk last week regarding the proposition that strengthening copyright laws might be necessary to protect news sources from online “free riders.”  Even our own Harold Feld chimed in, in this week’s episode of “5 Minutes with Harold Feld”.  The flurry of commentary on this was owed in large part to a post by Judge Posner on his Becker-Posner Blog.  The most relevant (and divisive) sentence in the post is the following:

    Expanding copyright law to bar online access to copyrighted materials without the copyright holder’s consent, or to bar linking to or paraphrasing copyrighted materials without the copyright holder’s consent, might be necessary to keep free riding on content financed by online newspapers from so impairing the incentive to create costly news-gathering operations that news services like Reuters and the Associated Press would become the only professional,nongovernmental sources of news and opinion.

    The idea of legally barring the capability for one website or aggregator of news to paraphrase or link to a primary online news source is at odds with current custom and is intuitively inappropriate.  It’s also not in line with current copyright law to the extent that only expression may be protected, and not facts.  In other words, in our current regime, no one is granted a monopoly on the facts.  Now, that might sound great – it’s intuitively appealing, it makes sense for facts or “news” to be free flowing in a democracy and so forth – but the issue gets more complicated if you seriously worry, as Posner seems to, that the failure to offer any protection for facts might provide inadequate incentives for the costly information gathering that gives the public access to all that rich information in the first place.

    Basically, the concern here isn’t a moral one that “free-riders” are lazy or reaping benefits unjustly; it’s a practical concern that they might end up killing what Posner has in other writing referred to as “the goose that lays the golden eggs,” – the original source of the content.  But I think, ultimately, that concern does not justify the solution he suggests.

    There are many situations in which we (or “the law”) value costly information gathering and so protect that information to the extent necessary to encourage the work of gathering it, even though such protection might have some ugly consequences.  The textbook example is the case where an oil or mineral company does some (secret) investigative analysis, discovers there’s oil on Jed Clampett’s land, and makes the poor farmer an offer that does not reflect the true, hidden, and secret, value of that land.  Now, intuitively, it looks like the farmer’s getting ripped off here and the oil company is making a steal (and, arguably, that’s true!), but since the oil company never would do the work of finding the resource if they were forced to disclose the true value of the property to the poor owner – and since we all like having cheap gas for our cars – we say, go ahead oil company, gather that information and keep it close to your chest!

    However, the value of information as “news” creates a very different situation from this textbook example I just described.  The value of “news” lies in the disclosing of the news.  This stands in opposition to the previous scenario where a private business entity turns a profit by keeping the information it has gathered secret, benefiting the public as a byproduct (with cheaper gas, etc.). As such, encouraging news sources to gather information is trickier than with other endeavors since they’re gathering it with the intention of making it publicly available, or, rather, with the intention of making a profit by making it publicly available.  They can accomplish this either by selling access to the news itself or by selling ad space in conjunction with the news content.  So the problem arises: how can we encourage journalism and the costly gathering of information for the purpose of disseminating that information to the public when that information can be copied and dispersed by other parties as soon as it is released?

    In the past, the time-lag of printed newspapers gave a natural protection to this kind of information gathering, making a legal protection unnecessary.  So, the proposition goes, in the digital age, that “natural” barrier has been removed and legal protections have to step it up in order to maintain the appropriate incentives.  Supposedly, there may be some legal precedent for this idea in International News Service v. Associated Press, where the competitor INS was barred from printing information gathered by its rival, the AP. The natural time lag of the printed word was not sufficient protection in this case since INS was able to print the news on the West Coast the “same hour” that AP printed it on the East Coast due to the time zone differential (INS was, effectively, cashing in on a 3-hour grace period since people don’t buy newspapers before they wake up).  But, importantly, the Supreme Court specifically ruled that this was not an example of copyright infringement.  What animated the Court’s decision in that case was a concern for unfair competition and misappropriation.  That is, INS gave the false impression that it, and not its competitor, was the source of the news and the gatherer of the information.  Those aren’t the issues in question here, and so that legal precedent referred to by some isn’t so applicable in this scenario.  For one thing, in the age of blogging, it’s far from clear who can really be called a “competitor” and who is an amateur, and these secondary sources are giving credit to the original source by linking to it! 

    Now, it has already been pointed out by a number of people, including Harold Feld, that much of the advertising revenue that used to go to newspapers from classified ads has been siphoned off by Craigslist.  According to Posner himself, classified ads account for 40% of newspaper revenue.  So the charge that newspapers are dying as a result of “free-riding” is dubious.  But for the sake of argument, let’s assume that secondary websites paraphrasing and linking to the original news source do seriously divert traffic from those “primary” websites.  In that case, the New York Times or whomever else loses some traffic, and therefore possibly some ad revenue, if I simply read a paraphrase of their information elsewhere or use an aggregator to read the information without having to come into contact with the advertising on their website.  The only legitimate concern, then, is if this linking to and paraphrasing of the original news source would threaten the existence of that “golden goose” – the original provider of the content. 

    I, for one, am not concerned.

    Posner seems to cast this as a commons problem, with all of these competitors feasting off the news gatherer’s labor, a situation that supposedly can only last so long if the news gatherer never gets compensated. Now, from that perspective, these secondary websites or aggregators should actually WANT there to be some way for the original gatherer to stay in business (how else will these secondary sources be able to keep “free riding”? The mosquito doesn’t want you dead, she just wants a daily snack).

    The first assumption, I take it, is that these secondary online sources won’t see the doomsday scenario coming or figure out how to save the news gatherer without the government stepping in and changing the copyright law.  But that is an incredibly drastic step to take when there are other options available. These are sophisticated parties that work in the same industry: news gathering and dissemination.  All concerns about the First Amendment aside, to the extent that this kind of secondary linking and paraphrasing behavior really does threaten the existence of the original news gatherer, we should expect the parties to work out some kind of solution.  Sure, there are transaction costs (meaning it’s hard to get the relevant parties to the bargaining table to work out a deal), but really all the original content provider has to do is stop putting the content up on the web for free and then secondary sources or aggregators will be forced to bargain for private contracts.  And existing legal protections through the DMCA § 1201 are sufficient for this task.  If it turns out that people are not willing to pay for such content through subscriptions and turn elsewhere for other sources of “free” ad-supported news, then so be it.  Let the “original gatherers” figure out how to keep people coming directly to their own site so that readers come into contact with their own sponsored ads.  Personally, I think Posner does not give enough credence to the “horse’s mouth” factor: plenty of people click through to the original news story to get the information before it was reprocessed – I know I do.

    The second assumption, and this is the real sticking point, is that new golden geese won’t emerge should the first ones die.  This is a truly shocking supposition.  It presumes that the demand for high quality in-depth reporting is not what creates good journalism, and rather that the public has merely benefitted from a historical tradition of news gathering that is costly to supply.  Apparently, this has been provided to the public independent of the demand for it (so why was it being supplied in the first place?) and may go the way of the dinosaur should the current constellation of news sources not somehow be fixed in the context of the Internet. 

    I’ll respond with my own supposition: to the extent that people have demanded costly in-depth news reporting, they will continue to demand it, and that demand will be met.  Now, it might be true that this will necessitate some serious changes in the industry, but that is far more preferable to making serious changes to copyright law that would undoubtedly have unintended consequences.  I would rather put my faith in the market to figure out how to meet the demand for quality reporting than ask the government to change the law so that private parties could have a claim to ownership over facts.

    After the case INS v. AP, newspapers were given a limited legal right to sue each other for misappropriation of news-content by direct competitors.  But the truly interesting thing is that this has rarely happened.  Instead, the news industry maintained a sort of ad-hoc reciprocity agreement reflecting their communal interests.  It may be that the fix for this current problem will be yet another community-based solution rather than the privatizing of facts.  News sources might find that the answer to their woes isn’t to copyright-protect their golden eggs, but to see that others have their own golden eggs to offer.