How Current Copyright Law Discourages Creative Output: The Overlooked Impact of Marketing

Abstract:     
[Note: the substantially revised published version was posted here on Aug. 4, 2004]

This Article explores how copyright law's prohibition against unauthorized copying and sales may, counter to the law's purported goal, have an overall negative impact on the production and dissemination of creative content. The Article contends that in the current lottery-like environment of many media markets, copyright law disproportionately inflates the revenues of the most popular creations leading their publishers to spend increasing amounts on promotional campaigns, which drown out economically marginal creations. This discourages, rather than encourages, investment in many new creations. As a result, current copyright law may actually reduce the overall production of new creations. As an alternative to the current strict limits copyright law imposes on copying, this Article explains how new technologies, social norms, and much weaker prohibitions against unauthorized copying may be combined to create viable business models for financing new creations. These business models appear capable of ensuring creators and publishers a sufficient profit to stimulate creation and distribution but without the significant harms to creation of broad prohibitions against unauthorized copying.

Keywords: copyright, marketing, business models

JEL Classifications: C7, D2, D3, D4, D6, H2, J3, K0, K3, L1, L2

Accepted Paper Series