April 27, 2008  ·  Lessig

Just after the writer’s (and writers’) strike ended, Matt Prager (who worked for 15 years in Hollywood as a writer and executive) sent me this fantastic essay about what was really at stake in the strike (guess…). Here’s the start:

The WGA strike to date has been more or less characterized as a strike over money; most press reports have dealt with negotiation demands like residuals and up-front compensation on internet streams and downloads, jurisdiction over reality and animation, and other such issues. However, the press reports have missed the central, underlying issue of this strike: copyright. This battle is not “poor laborer” versus “greedy company” – everyone in Hollywood is pretty greedy frankly. Rather, in the same way that fiction is the business of Hollywood, so is the entire underpinning of Hollywood built on an enormous fiction. But to understand the fiction, you first need to understand some facts.

Here’s the balance.

  • http://www.digitalproductions.co.uk Crosbie Fitch

    Matt Prager has spotted the disintermediation opportunities, and it’s good to see him point out the obvious to those who might not have spotted it yet.

    However, he’s still ignoring the white elephant in the room, i.e. copyright.

    This may be deliberate. It is likely his sound warnings would be ignored if he not only pointed out how the Internet changes everything, but that copyright too might also be subject to question.

    When there is no longer any benefit to controlling the proliferation of one’s works, one can begin to question the mercantile privilege of copyright that grants such control, and perhaps whether the public should have their cultural liberty restored after 300 years of unethical suspension.

  • http://sethf.com/ Seth Finkelstein

    Frankly, that analysis seems to me to be both crankish and deluded with the frothy Internet-evangelism that the Writers Guild Strike should have demolished once and for all.

    I want to STRONGLY recommend reading the Guardian column I wrote about the Writer’s Strike:

    http://www.guardian.co.uk/technology/2008/jan/03/internet.digitalvideo

    I think it’s one of my best pieces, and it gets at something that’s really important against all the corporate servants in demagogue’s clothing:

    “By contrast, in the view of too many new media pundits, the only acceptable type of collective action for workers is to form a kind of self-help support group, hopefully to better their individual value in the marketplace by improving their competitive position relative to others (and it’s even better if they can then all be sold to a big company as a pool of customers for an industry of advice and services). The idea of collective bargaining, of labour forming an organisation to offset the power of the modern corporation, receives such disdain that it shows something revealing under a pseudo-populist mask, and which political interests are really being served.”

  • http://hyokon.com hyokon

    This is a useful read. I probably do not understand the legal meanings fully. I am not a US citizen either, but the US is such an important benchmark for Korea (and most parts of the world, friendly or not). And the copyright is probably the most important legal issue for the free market in the Internet age. So, I am interested.

    It is surprising that a voluntary agreement to exchange goods (money and copyrights) may not be legally effective. I don’t know what the intent of the law is behind that. But if the hirers expected that they would not own the copyright even if the writer had agreed to transfer the copyright, they would have paid less (or not have done the deal at all). I think the contracts should be respected, unless there was any cheating. But if the copyrights are to belong to the writers, I think it would be fair for the writers to pay some back to (or share some future revenue with) the hirers. I am not talking from a legal perspective, which I can’t. I am just saying what seems to make sense to me. The ‘free’ in the free market means ‘voluntary’ agreement. You are not forced to buy or sell something unless you agree to. The flip side is responsibility. If you voluntarily agreed to do something, you should do it. Reversing voluntary agreements (usually by the government) has the risk of weakening this basis.

  • Mac the Knife

    A good read, though I wonder if Prager has an overly simplistic take on works made for hire. I’m hoping some of the copyright geeks reading the blog could help me out:

    • Prior to 1976, “work made for hire” was not defined in the copyright law. If I remember correctly, a couple of cases established that a work was made for hire if it was made “at the instance and expense” of the paying entity; this did not limit itself to employees. If so, how does this change Prager’s analysis of the genesis of “for hire” authorship in motion pictures?
    • I also think that Prager “pooh-poohs” the “belt and suspenders” technique of not only making the writer agree that the work is made for hire, but if it’s not made for hire, then ownership of the copyright gets transfered (the regular way) anyway.

      • He seems to dismiss the transfer simply by saying there’s no consideration. But from what I remember from first year contracts, there are lots of ways to stretch something into consideration. From his example, even if swapping out the Honda Civic for a Rolls-Royce doesn’t work, the contract can easily say that for this swap the car owner can get an extra dollar. This doesn’t seem like a huge hold-up on the part of the producer.
      • If there is consideration for the transfer, and Jon Stewart does what Prager suggests, in some cases it will be very hard not for him (or the writers he’s hired back) not to use some of the material that he just transfered thereby making his version an infringing derivative work.
      • He also seems to think that by terminating the transfer, the writer will instantly get his/her copyrights back and all will be well with the world. Not so, for a few reasons.
        • First, the transfer can’t happen until 35 years after the contract is signed. That’s a looooong time, and is little solace for the aspiring writer who is deciding whether to transfer copyright now.
        • Second, termination of transfer is really tricky (cc’s termination of transfers tool notwithstanding), and half the time the person attempting to terminate won’t get it right. The other half, the studio will challenge the validity of the transfer (even if it’s legal) and most likely the writer will be forced to settle because the studio can just outspend him in litigation.
        • Third, and here’s the kicker, the termination right includes a “derivative works exception” meaning the transferee (the producer in this case) gets to keep the copyright in the derivative work made, under the same terms as the original grant. This is what the studios want. Thirty-five years after the script is made, it will be just a dusty memory. The motion picture is what has the rights. Sure, the writer can license another motion picture to be made based off of the same script. But with a thirty-five year lead time, plus possible trademark rights in the movie’s title and other source-identifying features, I’m not sure the studios are quivering over this type of competition.

    The point of my post is that it’s kind of silly for the strike to have been mainly about whether a script is a work for hire or not. Ownership (especially of intangible property) means nothing if you can’t capitalize on it, and conversely, if you can get the same revenue stream regardless of whether or not you claim title to the intangible property, then who cares whether you own it? Of course, this doesn’t take into consideration the emotional benefits one may have from ownership, but it doesn’t seem like Prager is approaching ownership from this perspective. He’s talking about Jon Stewart taking all of the revenue from Internet video, etc. That just sounds like writers arguing for a bigger slice of the revenue pie.

    So maybe, the strike was about money.

  • Mac the Knife

    BTW, I did not use the term “copyright geek” pejoratively. As you might be able to tell from my post, I certainly qualify.

  • http://unitedhollywood.ning.com/profile/ScottEllington Scott Ellington

    Writers have little reason to challenge existing copyright law so long as the means to wide distribution of products derived from their work aren’t under the pervasive control of an infotainment cartel (very ably represented by the AMPTP).

    The internet affords those writers an alternate means to distribute products derived from the blueprints they create. And the internet is in jeopardy of falling under the pervasive control of an ISP cartel which is already suspected of operating un-transparently to the detriment of content that competes with that which ISPs prefer.

    Writers seem to have little to say on this subject. Their silence will remain mysterious until a wealth of newly-produced content makes its presence felt in regions of the media universe separate from the old.

    Having attempted to read the current Minimum Business Agreement, I believe that the future transparent relationships between content creator, producer and distributor will “brand” consumer interest and loyalty far more effectively than a studio logo. I also believe that consumer boycott of old-media-studio product is an infinitely more effective means to dismantle the engines of tyranny. And that the most fundamental relationship, between storyteller and audience, has survived the Twentieth Century.

    The problem with my vision of the very near future is that writers haven’t yet addressed this topic, and they haven’t directly and transparently addressed their public…yet.

  • http://unitedhollywood.ning.com/profile/ScottEllington Scott Ellington

    The Minimum Basic Agreement 2007 is available for inspection here:
    http://www.wga.org/subpage_member.aspx?id=2204
    although it probably isn’t intended to be reviewed by anyone who doesn’t belong to the WGA.

    The studios and networks have begun to colonize the internet (for example) here:
    http://www.hulu.com/browse/alphabetical/movies

    And
    There is a twilight dimension beyond those which are commonly known to the general public,
    wherein a few elite writers and studios live quite happily together, here’s one:
    http://artfulwriter.com/?p=125

  • http://www.ThisOrProzac.Com Matt Prager

    Mac the Knife:

    This is Matt Prager. To respond to a few of your points:

    I think boots-and-suspenders would end up being tricky for the studios as there’s a fairly simple argument to be made that a studio – with its battlion of attorneys – should know whether something is work-for-hire or not. That knowledge makes boots-and-suspenders border on, if not fraud, then something that kind of smells like it. Also, there’s the issue of what, exactly was exchanged. If I sell a screenplay to a studio, I’m obviously giving them the right to make and distribute a movie. But am I giving them the right to sell it on DVD? To stream it? To air it on HBO? To make a theme park ride out of it? How about to make a sequel out of it? Or a TV series? Or a videogame? My belief is that, were one of these contracts to come before a court, boots-and-suspenders would severely curtail the infinite copying and distribution rights studios currently have under their unenforceable work-for-hire clauses.

    As for your point about termination. True, 35 years doesn’t help a writer today. And, yes, studios would still own the derivative work they’d created. But to use a tangible example, THE STING was released in 1973, meaning it’s in its termination phase. The writer (David S. Ward) could terminate his copyright and sell remake rights to THE STING to some other studio. He could sell rights to have a STING casino in Las Vegas or do a TV series of THE STING etc. etc. In other words, THE STING’S age doesn’t make it valueless in the market.

    And as for whether or not a copyright is just a dusty memory 35 years later, take that up with the Siegel family and the SUPERMAN copyright case . Also, something could have been written and made 35 years ago to no fanfare because the script’s time hadn’t come yet. Think of the musical CHICAGO which was a flop when it first came out in the 70s, for example. There are, I think, plenty of reasons for studios to fear copyright termination – creative works can have long afterlives.

  • http://unitedhollywood.ning.com/profile/ScottEllington Scott Ellington

    http://www.huffingtonpost.com/jonathan-rintels/big-medias-common-interes_b_98568.html

    The Big Kids are losing ranks,
    and they’re shamelessly using the very same slogan that really should have been copyrighted during the writers’ strike. Not that that would matter.

  • http://unitedhollywood.ning.com/profile/ScottEllington Scott Ellington

    Here’s my second attempt to add this link to flavor your discussion:

    http://artfulwriter.com/?p=125

  • staypuftman

    Page 4:

    “The creative force behind Windows is Microsoft not Microsoft’s programmers whereas the creative force behind an original film or TV show is the writer and not the company that bought it.”

    Specious claim. Microsoft may set the coding schedule but the actual feel of the program is definitely a creative enterprise controlled by the programmer. Go ask a mac fanboy.

    This guy’s article gets to details, which is wrong. This whole copyright paradox comes down to the broken idea that you can control creativity. Big media did it for awhile and the party’s ending – and they are not happy about it. Lessig – you even talk about it. 1000 years ago people sat around fires and trading oral histories and danced to music they made. We are just slowly returning to that distribution method today.

  • Mac the Knife

    Hi Matt,

    Thanks for responding. I guess we have to agree to disagree on the effect of the belt and suspenders contractual language. Litigants argue things in the alternative all the time. Contracts prepare for alternative contingencies all the time. And since there’s no lawyer in the world who can be absolutely sure how contractual language will be interpreted, the fact that the contract provides for two alternative interpretations doesn’t undermine the language’s validity as to alternative 2 should alternative 1 legally fail. And if the contract provides for transfer of the entire copyright, then all of those rights you question belong to the studio for 35 years at least.

    And I also think we have to agree to disagree on the impact of the derivative works exception. That means the movie studios would own not only the finished motion picture, but all drafts based on the original draft, all other works based on the motion picture (tv series or coloring books, for example). All of the derivative works in the market at the time termination occurs are marketed under the studio’s brand, etc. And finally, the time between issuance of the termination notice and the actual termination can be as long as ten years, so in the intervening time period the studio can flood the market with derivative works (all of which it would own even after the termination). This suggests that a competing remake will have a hard time competing on the marketing front. Also, the competing remake will have to take material only from the original draft and not based on material found in subsequent drafts or in the completed motion picture. Either the first draft will have to be so complete that only minimal edits will have to be done in subsequent drafts, or parts of the remake will need to be very far removed from the first movie and audience recognition may suffer as a result.

    I agree with you that some copyrights may have a very long life–that was not what I meant to insinuate. And I think we also agree that the actual individuals who do the creating deserve better than the short end of the stick in favor of corporate interests. At the same time, the premise of your essay is that the writer’s strike was about something more than money. Respectfully, I disagree. Termination is still an issue, as the case involving the Siegel heirs illustrates (which occurred outside of the context of the strike). And what the writers won was additional income from residuals on derivative works, which aren’t subject to termination. So, maybe the strike was about money, maybe it should have been about money, and maybe the writers are better off for it.

  • http://ryan.sandridge.org/ Ryan Sandridge

    staypuftman beat me to the punch. I was about to quote the same sentences, and offer my objection. I think there are a lot of software developers out there (from Microsoft, or any other software company), who would object to this analogy. But the analogy was off to a poor start to begin with in my opinion. I don’t consider the software that I purchase to be “content” to begin with. At least not all software (games seem like content). Is my internet browser content? No, it is a tool that allows me to consume content created on the destination site that I browse.

    Software is a strange beast, and I find that most attempts at analogies to software don’t quite fit. But one thing is for sure, software development is a creative endeavor, and Microsoft would be equally as crippled if all their programmers quit as Hollywood was hurt by the writer’s strike.

  • http://unitedhollywood.ning.com/profile/ScottEllington Scott Ellington

    http://www.youtube.com/watch?v=wmE1OWS4Ncg

    The strike is only nominally “over”.

  • http://vallywood.blogspot.com/ Steve Diamond

    This guys knows a little bit about net neutrality and nothing about the dynamics of labor negotiations, particularly those at work in the WGA strike. Note his comment that the DGA negotiations were irrelevant. What silliness – the Producers used the DGA to undercut the WGA and did so very successfully. The Producers are now doing the same with the tensions between SAG and AFTRA. As for the potential for a new on line business model – again, no real understanding of the challenges of building new business models. Look for an alliance of the producers and the telcos/cable cos to build and shape the new online world long before the Valley is able to do so. Much less disorganized independent content creators.