Copyright Under Siege: An Economic Analysis of the Essential Facilities Doctrine and the Compulsory Licensing of Copyrighted Works

Abstract

This paper examines the application of the essential facilities doctrine (EFD) to copyrighted works. It attempts to address three contemporary issues. First, it offers reasons why copyright has become subject to competition law regulation under the essential facilities doctrine. Second, it makes a brief survey of seminal cases where courts in the EU and US have had the unenviable task of grappling with the esoteric economics of copyright and network effects, as well as the impact of sector specific regulation. It argues that while the EFD may be necessary, certain assumptions need to be reconsidered. The EFD should not be an arbiter of unmeritorious copyright, but rather intervene because such forms of copyright cause market inefficiencies. Separately, those seeking access should be from a downstream market and must offer more than a mere clone of the copyrighted work. Care must also be taken not to adopt a per se approach toward superdominant copyright owners and locked-in markets. Third, this paper argues that reasonableness is a workable standard for compulsory licensing, and highlights the role of economics in working towards a clear and principled standard of access to copyrighted works under the essential facilities doctrine.

Keywords: essential facilities, competition, copyright, law, intellectual property, microsoft, singapore, network effects