Mises Daily Articles
Writers Can Prosper Without Intellectual Property
It is commonly supposed that, whatever its moral and theoretical standing, intellectual property is necessary for creators of written works to make a living and — even more importantly — to continue to create. Here, I will set aside the theoretical status of copyright, which is amply discussed in Stephan Kinsella's Against Intellectual Property and Michele Boldrin and David Levine's Against Intellectual Monopoly. I will focus on existing and emerging possibilities for writers to earn a living in a world where no copyrights exist.
By way of real-world examples and suggestions based on observations of existing and historical practices, I seek to assure writers and other intelligent laymen of all persuasions that writers would not starve, and writing would continue to flourish, if copyrights disappeared off the face of the Earth tomorrow. I hope to foster an appreciation of the breadth of human creativity and the multitude of possibilities for innovative endeavors.
The popular, copyright-inspired model of revenue generation for writers entails contracting with a publishing company for a combination of payments: (1) a modest initial advance on the written work, typically paid at or prior to publication, and (2) a continual stream of royalties, typically paid as a proportion of the written work's earnings. The royalties comprise the greatest share of revenue for most "traditionally" published writers under the copyright system; most authors and publishers within this system perceive copyright as necessary to ensure that the royalties continue for a prolonged period of time.
Even without copyright, there is a first-mover advantage to simply having released a work to market before anyone else could. Moreover, if the work is reasonably priced and attractively presented, there would be little reason for potential buyers to feel dissatisfied with it in a manner that would render it lucrative for competitors to enter the market.
For competitors, the investment of publishing the book and the considerable risk in competing with an established producer would cause them to think twice before undertaking this venture. Unless the original publisher has failed significantly in packaging, marketing, and pricing the book, its first-mover advantage is likely to last far into the future.
As for digital downloads of the book, considerable evidence exists that these do not cannibalize hard-copy sales. Indeed, book sales have skyrocketed since the emergence of easy copying possibilities on the Internet. Downloads likely also furnish a marginal gain to the author's reputation in excess of the marginal costs of any revenue foregone directly due to a download — especially if those who download a book today would likely not have purchased it if it were not available for free online.
But suppose that the defenders of copyright are correct in their assumption that the first-mover advantage is ephemeral. Suppose that this advantage could not be relied on as the competition seized on a good work and began to market it at equally advantageous, or more-advantageous terms than the initial publisher. What other recourse could writers have?
1. More Frequent Publication of New Works
If there is a first-mover advantage that lasts several months or years, irrespective of whether intellectual property exists, then a given author who chooses to adhere to the "traditional" publishing system could pursue the strategy of writing and publishing a new work every time the first-mover advantage of the previous work has been exhausted. This would lead to a necessary change in expectations: an author could not expect to live off the royalties from a single work — even a widely popular work — forever but would need to keep creating in order to maintain his revenue stream.
Nonetheless, this is not far off from the current situation; after all, most published books do not sell nearly well enough to assure the authors even a modest stream of lifetime earnings. Moreover, such a system would incentivize creation of further works.
Indeed, prior to the introduction of copyright, European classical composers found it necessary to continually create music, as their older and already-famous pieces were often performed internationally without any compensation given to them. Even so, some of these composers managed to be phenomenally prosperous as well as prolific.
The most famous composer of the early 18th century, and one of the most prosperous, was Georg Philipp Telemann (1681–1767), who is thought by some to be the most prolific composer in human history, with over 3000 works to his name. Telemann's status is rivaled by Simon Sechter (1788–1867), who wrote over 8000 works, many of them short fugues, and who endeavored to create at least one short composition every day. Neither composer lived under a copyright regime.
Indeed, virtually all of the big names of classical music — Bach, Vivaldi, Haydn, Mozart, Beethoven, Schubert, Chopin, Brahms, Berlioz — composed without copyright and were not dismayed when their works were performed without their participation or consent. Composers through the Romantic era would often borrow passages from their peers and predecessors and develop creative orchestrations and variations thereof. This was not considered to be theft but rather the ultimate compliment: a demonstration that a composer had been able to cultivate a musical idea that could now thrive independently of his efforts.
If composers could set still-unmatched records of productivity without copyrights while managing to earn a living, imagine what writers could do in an environment that did not give them the hope of forever subsisting off past accomplishments.
2. Larger Initial Advances
Writers seeking to publish their works via the "traditional" system could come, in an environment of no copyright, to expect larger initial advances from publishers as a tradeoff for smaller, less stable, and generally diminishing royalty streams. There is no reason why this could not be lucrative for publishers. The publisher could pay the writer a larger one-time fee, getting in exchange the first-mover advantage over the competition.
When the competition catches up and resorts to publishing a book that has been well received by the public, the original publisher has at least the potential of competing on even terms with regard to expenses; the competitors would not need to pay a substantial fraction of their earnings to the author, and neither would the original publisher.
The tremendous proliferation of British novels in the United States during the 19th century can give us a glimpse of what such a world might be like. British authors had copyright on their works in Britain since the enactment of the Statute of Anne in 1710, and American authors had copyright on their works in the United States since the passage of the Copyright Act of 1790.
However, as the era of international copyright had yet to be inaugurated (via the Berne Convention of 1886), British authors did not have copyright on their works in the United States; instead, they typically sold the rights to a first printing of their work in the United States. Thereafter, the original US publishers of these authors would not owe them royalties and would therefore not be obligated to pay this additional expense, putting them on par with potential later publishers of the same works. The British authors made more money selling their works in the US in this manner than they did under the copyright and royalty system in Britain. Moreover, their works became significantly more popular in the United States than those of their American contemporaries.
3. Patronage 2.0
Some of the greatest works in history have been created by writers and artists working under the patronage system, in which wealthy and influential individuals supported creators in exchange for a consistent and high-quality output, often used to advance the patrons' interests and public image. The historical patronage system also exhibited numerous genuine flaws, including significant restrictions on the creativity of artists by overbearing patrons. Yet the flaws of the system were due not to the institution of patronage per se, but to the structure of preliberal, preindustrial Western societies.
Patrons were extremely scarce, and most of them had financial resources not due to personal merits or economic achievements, but due to political power. For writing in particular, this was a hindrance, as writing for a patron typically meant avoiding the expression of ideas that would upset the established political order, on which the patron built his wealth and power. On the other hand, if one's patron was subversive of the established order, like the Earl of Shaftesbury (1621–1683), the patron and sole patient of John Locke, some radically provocative work could result.
Some creators were fortunate to find reasonable and enlightened patrons, but even these had idiosyncrasies that needed to be catered to. This bred extensive resentment of the patronage system and inspired a reaction and shift to its polar opposite: mass marketing to as broad a consumer base as possible. Yet this approach, too, has numerous evident shortcomings.
In our time, the fundamental flaws of the historical patronage system need no longer persist, because the distribution of potential patrons is so much greater. Indeed, most people who are established in "white-collar" occupations can afford to become patrons of the arts today. In addition, because of computers and the Internet, writing and publication cost very little except for the time and effort spent actually putting the words and ideas together. Not only has the capacity of most people to fund writers increased dramatically, but the exertions and materials required for writing have diminished considerably as well.
Any patronage system would necessitate some manner of creator compliance with the patron's wishes; that is what the patron is paying for. However, with a large number of potential patrons on the market, a given writer does not need to feel dependent on financial arrangements with a particularly disagreeable patron; he is free to find another patron — or even to work for a multitude of patrons simultaneously.
Patronage can be expressed monetarily, but it need not be. In-kind patronage — such as that performed by numerous online magazines that publish essays by contributing authors — is another mechanism by which writers can find resources to support their endeavors.
"Self-patronage" is a concise way of expressing the concept of writing during one's leisure time while pursuing another occupation as a primary income generator. If another person with an above-average income can serve as a patron for a writer, then it is just as easy for the writer himself to earn an above-average income in a profession of his choice and then use it to subsidize his writing.
This is a promising option for many writers today, myself included, and it should not be dismissed as a viable long-term model for the creation of quality output. Self-patronage is tremendously efficient; it frees the writer from having to get clearance from any external entity to write or publish what he pleases. Moreover, it frees the writer from needing to satisfy a mass audience; he can make his works as sophisticated, specialized, or controversial as he pleases. If they gain notice and admiration, this can result in some added bonuses for the writer; if they fail to catch on, he is not endangered in his livelihood and can always try again.
With the ability to publish for free on the Internet, writers no longer require access to large institutions or wealthy individuals in order to spread their ideas to a large audience. They do, of course, need to compete with a much larger pool of creators than has ever existed — and this may result in difficulties for quality work in getting notice commensurate with its merits. However, because self-patronage eliminates the costs of getting external clearance, a writer can be as productive as he is motivated to be. By releasing vast quantities of works, he greatly enhances the probability that one of these will be noticed and will motivate some readers to explore his other works.
5. Online-Content Sites
A remarkable development on the Internet in recent years has enabled hundreds of thousands of writers to earn modest income streams from advertisements that appear on the pages where their work is published.1 Large commercial websites typically contract with numerous advertisers and establish an infrastructure for writers to conveniently publish a variety of works. Associated Content, where I have been publishing my writings for over three years, pays contributors both initial small advances for articles that pass editorial review and performance payments on the basis of how many page views contributors' content receives. The performance payment is not enough to earn a living — $2.00 per 1000 page views — but several hundred articles can provide a decent supplement to one's monthly income.
Helium.com, another site where I have published, invites authors to write competing articles under a given title and then to rank other authors' contributions. The authors who regularly participate receive a bonus based on the page views their articles receive. Yet another site, Today.com, the host of my blog, The Progress of Liberty, pays some bloggers a dollar for one post on any given day and supplements this with a performance payment based on visitation. Other commercial enterprises with a variety of compensation mechanisms have evolved over the last several years to enable layman writers to earn small revenues from their work without needing to have expertise in marketing or salesmanship.
The above methods of income generation, too, have their shortcomings in terms of which kinds of writing are most rewarded. But they are still in their infancy, and six years ago they did not exist at all. Within several decades at most, it will surely be possible for large numbers of authors to earn a living by writing and publishing their works on the Internet without being members of any syndicate or media organization's staff — unless, that is, established interests successfully lobby governments for restrictions on creative Internet activities.
6. The Best Option
The best option for promoting a writer's creativity while assuring him a stable and adequate income is a combination of the approaches above. Each approach, like most techniques in life, has its strengths and its shortcomings. For instance, patronage might result in the need to meet idiosyncratic tastes, while online-content sites that pay on the basis of unique visitors might incentivize writers to focus on breadth of appeal rather than depth. Self-patronage, on the other hand, is limited by the writer's existing resources and technical training in other fields.
In a relatively advanced, quasi-market economy with widely available, remarkable publishing technologies, it is possible to viably combine these approaches for an overall strategy that keeps one both fed and writing. Moreover, as the marketplace continues to evolve, and technological possibilities combine with human creativity to render new options available, writers should be willing to experiment with yet more ways of delivering their content to audiences and receiving corresponding compensation.
As is typical with markets, it is virtually impossible to exactly predict the way in which patterns of behavior will emerge, especially as one looks out into the long-term future. But this should not discourage writers; indeed, it should highlight to them the importance of being open to new possibilities. They should not simply expect that existing business models — such as the copyright-based, royalty-heavy compensation system of "traditionally" published authors — will continue in perpetuity as a matter of right for the parties involved.
It is never necessary to cling to a single legal mechanism or institution as the sole path for any given peaceful and productive human activity. Human beings are much more inventive and resilient than the defenders of copyright would suggest.
- 1. In reading this section, some might wonder about the frequent mentions of my activity on the various sites to which I refer. This is done in part to comply with the Federal Trade Commission's recent guidelines on the disclosure of writers' institutional affiliations. Thank you, FTC, for requiring me to boast of my work more than I otherwise would have.