August 1, 2004 · Tim Wu
Here’s the hypothesis: Today’s telecom and copyright laws often regulate similar subjects, but with a big difference. The telecom laws slightly favor market entrants, while the copyright laws favor the incumbent disseminators. The result is a “copyright gap” that grows larger every day.
Imagine you’re a startup, a market entrant, with a new way of getting information to people. Would you want to enter a market regulated by copyright or the telecommunication laws?
Under U.S. telecommunications law, you’ll likely be unregulated as compared to the your incumbent competitors. That’s what made Vonage a success–it doesn’t face the rules that control Verizon. It also what made AOL a success in the 1990s and WiFi in the 2000s. The only thing you need to fear today is possible network discrimination, though the net neutrality movement and Michael Powell’s threats have helped keep that in check.
Yet if you happen to fall under the copyright laws — you have a better way of delivering material that’s copyrighted — the structure of copyright says you need the permission of the market incumbents to carry on a regular business. Think of the story of internet radio, or KaZaA, iTunes and so on.
The result: The Copyright Gap. We have great, competitive VoIP and email markets, but still don’t have much in the way of Internet TV, video-on-demand, or the giant internet libraries once promised. Now obviously there are some justifications for this regulatory disparity, but to my mind not particularly convincing ones.