Is Rampant Copying a Good Thing?

I generally think of myself as a middle-of-the-road person in the Copyright Wars. I believe that the Cartel's jihad against its customers is ridiculous and that copyright maximalism does no one any good. I believe that government-granted monopolies (such as patents) ought to exist, but should come with restrictions that may include mandatory licensing. I also believe that artists should get paid and that we need to develop new models, not huddle in bunkers shielding old business models that ought to be on their deathbeds.

There's another school of thought, though: anything goes. We've seen this in industries like fashion where copying is in the lifeblood of the business. This is sometimes called the "wild west" but it would more accurately correspond to "colonial times." In the bad old days when American was the upstart and the British were the established heavies, Americans stole and copied and stole and copied. Even after the Copyright Act of 1790 and its successors became part of the body of American law, we were happily ripping off European authors to the point where they actively tried to keep their books out of the hands of Americans. The wholesale copying of IP in movies continued for most of the 20th century.

Spin forward to today and America stands in the place Great Britain used to occupy, and the populous, noisy, IP-disrespecting position is occupied by China. Now it's our turn to howl, so it's reasonable to keep pushing the comparison. Unfettered copying gave rise to those titans of Hollywood, industry, and publishing that are now so desperately trying to clamp down on the Chinese, so why should we be going along with it?

This is the core question posed by Kal Raustiala and Christopher Sprigman in the July/August issue of Foreign Affairs, in an article titled "Fake It Till You Make It." The bulk of the article is behind a paywall, but you can read Felix Salmon cheering them along on his blog.

In the article, they argue that America's (currently famous) innovative nature derives from its centuries of blithely ignoring IP restrictions. China today is a billion-person marketplace full of knock-offs, awash in copies of American products, copies of American ideas, and even one-for-one copies of American companies. Most of those copies are outperforming their American originals in the Chinese marketplace, which may have something to do with the way that the Chinese government is not just turning a blind eye but is actively promoting the copying-as-business model.

Raustiala and Sprigman call this "indigenous innovation" and argue that although many of these native-Chinese firms began as carbon copies they have since evolved and innovated past their American counterparts. This, they argue, is natural and healthy. It's good for Chinese, who get access to products and services they could not afford in the original. It's good for consumers in general, who benefit from a marketplace in which established companies feel pressure to innovate in order to stay competitive. And it's generally good for underdogs everywhere who are trying to unseat the current dominant players.

Salmon argues that Raustiala and Sprigman "don't go far enough" in that they seem to think drugs IP is special, an area where I definitely agree with Salmon. But this does not address the core issue, which I still see as "what are the appropriate compensation models for the 21st century?"

I don't think the analogy to developing American IP behavior is a perfect one. The idea of infinite perfect digital copies, the evolution of markets toward global, and the massive increases in connectedness make this century significantly different. At the very least, it's incumbent on those who want to argue for the analogy to explain why this new world is enough like that old world that the model still holds.