Externalities

     Last week, I spent several hours trying to help my mother perform what ought to be a fairly simple function: transferring files from a CD-ROM to her iPad. This turns out to be surprisingly difficult, thanks to the Digital Rights Management paradigm around which the iPad and, increasingly, computers generally are built. A device like an iPad is presumed to be tied to a particular computer, and so the songs and other things you've bought on your laptop are conveniently and automatically shared with your iPad. But to prevent piracy, there are barriers to sharing files with someone else's computer.

     So, all I wanted to do was use the CD drive on my laptop to move the files from the CD to my mother's iPad, but a dialogue box warned me that the syncing process would delete photos on my mother's device that weren't present on my laptop. We were eventually able to move the files over, but it took a long time and was ridiculously inconvenient.

     Okay, I understand intellectual property law, and the rationale for copyright, and why it's important to provide a means for creators to earn a living from their works. I get that, I really do. I don't agree with the calculations of how much the music and film industries lose to piracy every year, which are absurdly inflated and self-serving, but I'm sympathetic to the plight of the starving artist. I really am. 

     But really, is copyright law the best we can come up with? Are these barriers to copying really justified? Because those barriers impose costs on people, and not just the people who ought to be paying. 

     If you've taken economics, you're probably familiar with the term "externality", which just refers to any cost (or benefit) that doesn't show up on the balance sheet of the economic actor in question. The classic textbook example of an externality is the pollution from a factory. The factory owner's costs of production are the cost of the land and the factory itself, the raw materials used, the machinery, and the labour to run it, but the cost of pollution (quantifiable as reduced property values, additional health care costs, diminished agricultural yields, etc.) is imposed on someone else. 

     Factories may be necessary, but the exclusion of externalities from their accounting greatly distorts the appraisal of their economic value. You can't argue that a factory is efficient because it's profitable if it's being subsidized by everyone who has to put up with the pollution it emits; you have to take into account all the costs (and benefits; there are positive externalities as well) of an activity before you can trust in the validity of the Invisible Hand's market results.

     Now, I'm not arguing here that intellectual property rights should be abolished. (I feel sure there must be a better solution, but at the moment I'm at a loss to provide one.) But I am arguing that the copyright as it is currently applied imposes significant externalities on people who aren't pirating anything. The files on that CD-ROM my mother wanted to look at were sent to her by their creators for her to review; there was no violation of copyright at all involved. And yet, to protect the rights of a relatively small subset of copyright holders (i.e. those represented by traditional publishing and media companies), the iPad was built to make it difficult to transfer any files outside of the commercial paradigm. 

     The inconvenience of copying perfectly legitimate files is only one of the costs we pay to protect the interests of copyright holders. There are countless others, from the trivial (why can't I skip past watching that same FBI anti-piracy warning on a DVD? How many person-seconds has that wasted?) to the absurd (why can't I watch the original WKRP in Cincinnati episodes with the original music? Is anyone seriously going to use that show to listen to snippets of popular songs without paying for them?) to the genuine stifling of creative contributions to the world's cultures (Was anyone going to read The Wind Done Gone and decide they didn't need to read Gone With The Wind or see the movie now that they knew how it ended?)

     All of these costs are imposed upon you and me and the rest of the world. There may be good reasons for imposing them, but we still end up paying them, and paying them involuntarily. That basic fact undermines the media industries' attempts to claim the moral high ground. They are trying very hard to make us all accept the idea that unauthorized copying of things is stealing, and there's some moral validity to that. But I just had three hours of my time "stolen" trying to copy something the owner actually wanted me to copy. If the recording industry wants people to recognize and sympathize with their losses to unauthorized copying, this is probably the wrong way to go about it.