The present copyright system is beneficial for a few best-selling artists while providing no benefits at all for most creative professionals. Joost Smiers explores ways to improve the market, including the financial situation of most artists and designers, and to keep the sources of knowledge and creativity in common hands instead of privatizing them.

Joos Smiers

It was in 1993 that I started to realize that intellectual property rights – such as copyrights and patents – are steadily privatizing most of the public knowledge and creativity that our communities have developed and cultivated over centuries. Around the same time, I heard that farmers in India were staging massive protests. They faced the threat that seeds they had used for years to plant their crops would be slightly modified (or ‘improved’) by multinational agricultural companies like Monsanto, and that this tiny change would make those companies the owners of this ‘new’ knowledge.  KNOWLEDGE What those farmers and their grandparents, and generations before them, had developed in their communities over the course of centuries could, with a single stroke of the pen, become the sole and exclusive property of a major corporation. These are the selfsame corporations, most of which are based in Western countries, that dominate agricultural markets all over the world.

Is this what IP rights are really doing? Privatizing knowledge and creativity on a massive scale?

I was suddenly overwhelmed by a sense of cynicism. Is this what intellectual property rights are really doing? Privatizing knowledge and creativity on a massive and unprecedented scale? What could possibly justify such a bold move? It was a small step for me to extrapolate these principles from the seeds of Indian farmers to copyrights on works of art and design, which is another form of privatization. Certainly, it could be argued that every new contributor – every person who modifies or adapts seeds, words, music, design, or chemical processes – adds something to what has been developed by his predecessors. But is this a valid reason to hand over absolute ownership to the latest producer, keeping in mind that we will need this knowledge and creativity for further developments? Privatization in this context means that the product can no longer be used for common purposes, unless the ‘owner’ of this knowledge and creativity grants permission – and we pay the price that ‘owner’ sets for it. Never before in recorded history, in any culture, has intellectual misappropriation taken place on such a grand scale as what we have seen in the Western world over the past century, expanding exponentially since the 1990s.

It soon became clear to me — long before Napster and the increasing popularity of open source software — that we have to seriously question whether or not we really need to have intellectual property rights. My main concern, in the context of copyright for artists, entertainers and designers, was that they should have the chance to make a living. There can be no doubt that the present copyright system is extremely beneficial for a few best-selling artists, and fails almost entirely to benefit the majority of creative professionals. How can the market be improved to include a better financial situation for most of the artists and designers? Moreover, can we achieve that goal by keeping the sources of our knowledge and creativity in common hands instead of privatizing them?

During the 1990s, more people started to feel uneasy with our current copyright system, partly due to the opportunities offered by digitization. Concepts like free culture, open source and Creative Commons became fashionable.  ACTIVISM However, these concepts and the practices associated with them are less than helpful when it comes to creating a fairer market for creative professionals. With such a strong emphasis on ‘free’ access and sharing, how can this be the right answer for artists and designers seeking to earn a living from their work? In addition, these developments do nothing to reform current structures and power relations, in which a few huge enterprises dominate cultural markets. Aside from issues of democratic process, such companies artificially exclude from public view all artists who are not big stars, essentially pushing them out of the limelight. To assure a reasonable income for many artists and to stop the privatization of our common knowledge and creativity, a more fundamental answer must be found for the challenges we face.

What if We Would Abandon Copyright?

Suppose we were to leave copyright law behind us. Would it then be possible to structure a market in such a way that protection by copyright law would become unnecessary? The first question that springs to mind is what we would want to achieve in that cultural market. The answers follow from imbalances in the current structure.

→ Many more artists should be able to earn a reasonable income from their work.

→ The resources of production, distribution and promotion should have numerous owners, and access should be given more liberally.

→ An extensive database of knowledge and artistic creativity should exist in the public domain, freely available to all.

→ Audiences should not be overwhelmed by PR efforts aimed at marketing a small number of top stars. Instead, people should be freely exposed to a wide variety of cultural expressions, from which they can make their own choices.

How might all this be achieved? My starting point, which may come as a surprise, is the cultural entrepreneur. This individual could be the artist or designer himself, or someone who represents him or her, or a producer, publisher or commissioning client. The major characteristic of an entrepreneur is that he or she takes a risk in a chosen field, which in itself presents its own specific opportunities and threats. In this case, our field could be defined as ‘cultural activity’, a sweeping title which could also refer to the entertainment industry or to various forms of content production. The field in which the cultural entrepreneur operates bears some similarities to any other business; the cultural entrepreneur should think and act pro-actively. This individual should, in other words, be capable of staying one step ahead of the competition, try to stay on top of potential threats and opportunities, and be acutely aware of what is happening, both in his or her immediate surroundings and in the wider world.

However, a factor seldom mentioned in the context of entrepreneurship is the conditions that facilitate or obstruct risk-taking behaviour. How could such a market be constructed? How should the balance of power be organized, and what kind of regulations should set the limits and offer opportunities for the scope of entrepreneurship?

The Two Controlling Markets

The present cultural markets exhibit two forms of negative dominance. The first is copyright law. Copyright in its current form gives the owner control over the use of a work, with all the consequences that this entails. As an investment protection, it works well for best-sellers, pop stars and cinematic blockbusters, but at the same disrupts the diversity in cultural markets in ways that are harmful for cultural democracy. The second form of market control, monopolization, is often inadvertently overlooked in debates on this topic. Simply put, a limited number of conglomerates worldwide have a strong grip on the production, distribution, promotion and creation of films, music, books, design, visual arts, shows and musicals, as well as the conditions for how these creative expressions are received. Their influence also extends – even more than expected – into the digital domain.

These two forms of market domination go hand in hand. The exciting challenge is to find out whether eliminating both forms of market domination would create a more normal level playing field – whether it would be possible to achieve an environment in which no single party is able to control or influence the market or the market behaviour of others to any substantial degree. In this context, I feel that it is crucial for many cultural entrepreneurs – creative professionals, their representatives, agents, producers, publishers and so on – to actually be able to fully take part in the market.

What is currently keeping them from this level of participation? There is no single answer to that question. Yes, there are thousands and thousands of artists and designers producing work and therefore theoretically taking part in the market. However, they are often pushed out of public view by the omnipresence of the major cultural conglomerates. They do not have a fair chance to trade. Under these circumstances, it is made extremely difficult, to say the least, to bear the risk inherent in entrepreneurship. In essence, access to the cultural market – and therefore to audiences, clients and the opportunity to earn money – is severely limited for the vast majority of cultural entrepreneurs, but wide open for a few cultural giants, which continue to grow through mergers.

The Power of the Giants

These huge enterprises also hold the copyright to a vast number of the products that they market. As copyright holders, they have an even greater stranglehold on the market, as they are the only ones that can determine whether, how and where a vast quantity of work is used. They decide which cultural products are available in the market; they dictate which kinds of content are considered acceptable and appealing, and can determine the atmosphere in which they are enjoyed, consumed or used. Their works may not be changed or undermined, either, and alternative narratives would be banned.

The majority of cultural entrepreneurs have minimal access. Many, even the mid-level ones, enter a market – if they succeed – where a few giants determine the atmosphere and appeal of what they themselves have on offer, often having to compete against big stars and ‘famous’ designers.  DESIGNERS In this doubly dicey position, where a few major players not only dominate the market but also determine the atmosphere of the cultural playing field, it is not entirely impossible to succeed, but it is very difficult for many smaller and mid-level entrepreneurs to achieve any kind of profitable position in which they can survive.

A Proposal for a New Market

To achieve a level playing field in this cultural market, I see no other alternative than to undertake two simultaneous courses of action: first scrap copyright, and then make sure that no market domination of any kind exists with regard to production, distribution and marketing. So how does this work?

Abolishing copyright means it is no longer attractive for entrepreneurs to invest lavishly in blockbuster films, best-selling books or rising pop stars. After all, there is no longer any protection making those works exclusive. If this system were to be implemented, anyone could, in principle, change or exploit the works the next day. So why make such exorbitant investments any longer? Naturally, it is not forbidden. Anyone who wants to can go ahead, but the investment protection that copyright offered – that privileged exclusivity – is no longer available.

There should be many different players in all markets, and society should be responsible for imposing the conditions.

Does that mean, for example, that there will be no more epic films made? Who knows? Perhaps in an animated form. Is that a loss? Maybe, maybe not. It would not be the first time in history that a genre had disappeared due to changing production circumstances. Historically, as genres have vanished, others have appeared to replace them and become incredibly popular. It is not unthinkable that people will get used to the change very quickly. Moreover, there is no reason to offer investment protection to large-scale productions supported by excessive marketing that, in fact, pushes true cultural diversity to the outermost fringes of the market.

The second course of action I propose is to normalize market conditions. This may be even more drastic than abolishing copyright, a proposition which has become increasingly feasible over the past few years. As stated previously, no one party should control prices, quality, range, employment conditions, market access for other parties, or anything else, in any market. Similarly, no one party should be able to act with impunity, without regard for any other social considerations. In other words, there should be many different players in all markets, and society should be responsible for imposing the conditions under which they operate.

What applies to the economy in general surely applies even more to our human communication through artistic media. What we see, hear and read contributes extensively to the forming of our identities, in the plural. It cannot be stressed enough that there should therefore be many, many enterprises in the cultural field; instead of being pushed away from public attention by excessively strong forces, they should be able to offer their cultural wares from totally different perspective. I view that point as non-negotiable.

The Consequences

If such a dramatic restructuring took place, what would the result look like? There would no longer be any conglomerates dominating the production, distribution, promotion and creation of creative work or dictating the conditions for how artistic works were received. The scale of such enterprises would be reduced considerably, ranging somewhere between medium-sized and small. How could this landslide of change be brought about? Most countries have regulatory tools at their disposal in the form of competition or anti-trust laws, which are intended to level the playing field in every market – including the cultural market.

What should be happening is a fundamental investigation of anything that hints at an excessively dominant position in cultural markets, including design. That investigation should, perhaps, be one of the primary aspects of cultural policy. Imagine that large combinations of capital, assets, market positions, and production and distribution facilities were to be divided into many smaller pieces. After all, this is what we have been discussing for the cultural and media sectors in our societies. It may come as a surprise that this is even more necessary in the highly networked digital world, where it tends to be ‘winner-take-all’.

Suppose that the cultural market could be normalized, that a level playing field could be attained. Can the objectives I formulated earlier be achieved there? I think so. There are no longer any obstacles to many cultural entrepreneurs taking the plunge and accepting the risks. Enterprise always entails risk; it goes with the territory. There have always been some artists and entrepreneurs who have dared to brave those risks. In this new market, many of these cultural entrepreneurs can take risks with more confidence. Irrepressibly, those entrepreneurs will evolve in every corner of the cultural universe, serving audiences with a varied range of artistic creations and performances. What used to be niche markets can begin drawing larger audiences than had ever been deemed possible.

If the cultural conglomerates’ overkill marketing is no longer being dumped onto the populace en masse, then current and potential audiences are more than likely to develop interests in a wider variety of trends. Why not? Man is essentially a curious creature and has individual preferences on how he would like to be entertained or accompanied, as evidenced by the varied expressions of culture that people seek out as comfort in moments of grief. If those preferences are no longer being drowned out by a dominant few, then more room is created for far more individual choice.

Despite that individuality, man is also something of a pack animal.  TREND: GLOBALIZATION People will therefore in all probability cluster more around one particular artist than around others. That artist then becomes a ‘well-seller’. In our imagined scenario, the artist can never take that supreme step up to become a best-seller, since the market conditions that made that possible are simply no longer there. A normalized market for the public domain of artistic creativity and knowledge has turned out to be extraordinarily beneficial in our example. After all, artistic material and knowledge can no longer be privatized, and therefore remain the property of us all. There is not a single company left that can monopolize production, processing and distribution, either.
Now it gets interesting: how well does this thought experiment translate into practice? Could a real, functioning market conceivably be created under the conditions that I have formulated, in which devious thieves will be unable to seize their opportunity before taking to their heels? In other words, can numerous artists, their representatives, intermediaries, commissioning parties or producers earn a good living in that market? Are the risks of enterprise acceptable? Do they also have reason to believe that their work will be treated with the appropriate respect?

Let’s start with the question as to whether it is likely that creative work will be used by others without payment. Is there any reason to assume that another cultural entrepreneur will pop up and exploit it immediately after release? In principle, that would indeed be possible without copyright law. Nevertheless, there are several reasons why this is unlikely. First of all, there is the ‘prime mover’ effect. The original publisher or producer is the first in the market, which gives him an advantage. Naturally, with digitization, that prime mover effect can diminish to a few minutes, but that’s not an insurmountable problem in itself. Most artistic work is not famous enough for free-riders to fall on it like hawks. Moreover, an increasingly important factor is that artists and related entrepreneurs add a specific value to their work that no one else can imitate. Building up a reputation may not be half the work, but it is a significant factor. Remember, we are assuming that there are no longer any dominant parties in the market. There are no longer any big companies to think they could easily ‘steal’ a recently published and well-received work because, for example, they control the distribution and promotion channels. In this scenario, they simply no longer exist.

As a normal market emerges, many artists and designers will be earning better than ever before.

In the absence of copyright, there can now be no question of theft; still, free-rider behaviour is an undesirable occurrence. In fact, there are twenty, thirty, forty, or innumerable other companies that could come up with the same idea. With this reality in mind, it becomes less likely, even very unlikely, that another company will put the money and effort into remarketing a work that has already been released. Should one be concerned that someone other than the initiator and risk bearer merrily walks off with a work that belongs to the public domain? It won’t come to that. Investments go hopelessly up in smoke when numerous parties are willing to take a free-rider gamble. In that case, the first creator almost certainly remains the only one to continue exploiting the work; no one benefits from trying to take it over.

Let me remind you that the two courses of action I proposed earlier have to be taken simultaneously. Abolishing copyright should not be an isolated action. It has to be accompanied by the application of competition or anti-trust law and market regulation in favour of diversity of cultural ownership and content. Only then there will be a market structure that discourages free-rider behaviour.

It can happen that a specific work does really well. In that case, another entrepreneur could include it in his repertoire, make ‘legal’ copies, or promote it in his own circles. Is that a problem? Not really, since he or she will not be the only one able to do so. Moreover, if the first entrepreneur has gauged the market accurately and remains alert, then he will have a good head start on all others. The first entrepreneur can also offer the work in a less expensive version, for example, which doesn’t encourage competition. Nevertheless, successful works will certainly be exploited by others. That does not pose a serious problem, as the work has obviously already generated a lot of money for the author and the first producer or publisher. A legal copy or new presentation then only serves to enhance the author’s fame, which he or she can capitalize on  CREATIVE COMMONS in many different ways.

The Power to the Masses

I already mentioned briefly above that, if the market is structured as I propose, the phenomenon of best-sellers will be a thing of the past. That would be culturally beneficial, as real room is created in the artists tastes of people world-wide, encouraging a far greater diversity in forms of artistic expression. The economic consequence is that a tremendous amount of cultural entrepreneurs, including designers, can operate profitably in the market without being pushed out of the limelight by the big stars. At the same time, it has been established that some artists and designers often succeed in attracting more publicity than others. This will not make them best-sellers, as there are no longer any mechanisms for boosting them to worldwide fame. They become well-sellers. Besides being a nice position to be in as an artist, it would also be economically beneficial for the artists and for their producers, publishers and other intermediaries.

Another appealing effect is that the income gap between artists would take on more normal proportions. Before, the difference between rising stars and the rank and file was astronomical. In my scenario, the well-sellers may earn more than many other artists, but the differences are more socially acceptable. At the same time, another change is taking place, which is perhaps even more drastic. As a normal market emerges, many artists, designers and related intermediaries will be earning better than ever before. In the past, these people generally had a hard life, hovering around break-even point and often ending up in the red. Now, a substantially greater number will sell quite a bit better. This will allow them to scramble up above break-even point. They might not become well-sellers, but they don’t have to.

In the scenario we have explored here, a significant improvement has already been achieved, because their activities have become profitable. That is a giant step forward for the income of the artist and, at the same time, an enormous improvement for the risk-bearing entrepreneur (who may also be the artist or designer). The business is no longer in a permanent state of insecurity, barely making ends meet. Moreover, as the investment becomes more profitable, it becomes possible to build up capital to finance for further activities. It also becomes easier to take a risk on artists who deserve a chance – who should be published, who should have the opportunity to perform and so forth – but have not yet had the chance.

One surprising aspect of the economic and financial crisis that swept the world in 2008 is that, for the first time in decades, the idea of markets being organized in such a way that the structure does not solely serve the interests of shareholders and investors has entered the debate. A high price has been paid for the idea that they knew what they were doing and would automatically work to serve the common good. The neo-liberal notion that markets regulate themselves should be abandoned; it simply isn’t true. Every market, anywhere in the world, is organized in one way or another that serves certain interests more than others. Once this realization dawns, it will be a weight off our shoulders. We can then start constructively considering how we can organize markets – including cultural markets – to enable them to serve a broader spectrum of interests. There are exciting times ahead, not without their potential pitfalls, but with ample opportunity for these ideas to take hold and flourish.

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