Copyright Equality: Free Speech, Efficiency, and Regulatory Parity in Distribution
Boston University Law Review, Vol. 93, No. 6, 2013
Northwestern Law & Econ Research Paper No. 14-03
68 Pages Posted: 8 Feb 2014
Date Written: 2013
Copyright law treats webcasters like Pandora, on-demand streaming services like Spotify, the satellite radio company Sirius XM, and traditional radio broadcasters like Clear Channel in vastly different ways. The total royalties paid by each type of music distribution service to copyright owners can vary from five to seventy percent of revenue. This and other forms of differential treatment have slowed or deterred innovation while limiting consumer choice. The disparities have become a pressing problem for policymakers. Two recently proposed bills, the Internet Radio Fairness Act and the competing Interim FIRST Act, both address the disparate treatment across webcasters, satellite radio, and cable radio. But each bill contains only fragments of a real solution. Copyright law needs a new approach grounded in the reasons for equal treatment of different distribution technologies.
This Article presents an equality principle based on both economic efficiency considerations and First Amendment principles. These two theories of copyright policy are often thought to conflict. But this Article shows that efficiency and free speech values can align and reinforce each other. The economic argument focuses on barriers to entry for new music distribution technologies and the distortions to consumer choice that result from unequal treatment. The First Amendment argument is both an extension and new application of longstanding jurisprudence that guards new communications media from discriminatory treatment, with an eye toward allowing the information environment to evolve to the public’s benefit. The Article closes with policy recommendations in line with the equality principle and specific proposals for implementation.
Keywords: Copyright law, communications regulation, law and economics, First Amendment, Internet music, radio, Internet radio, webcasting, on-demand streaming
JEL Classification: k19, k23, l51
Suggested Citation: Suggested Citation