Striving to Get to Hanford in Balancing California’s Competing Intellectual Property Interests

Striving to Get to Hanford in Balancing California’s Competing Intellectual Property Interests

Perhaps no area of the world better serves as a reminder of the importance of copyright protections as Southern California.

Movie studios, music companies and video game developers make Los Angeles a copyright company town. Such industries are built upon the guarantee that a creator or artist can retain a property interest in their new works so that they can have ownership and protection of their intellectual property rights. This encourages risk taking and benefits the economy.

The public good and the individual right of intellectual property coincide in this space and power the U.S. economy. No better way exists to encourage creation and see it made available for the public consumption in one fashion or another. Such innovation is the key to a growing analog and online economy.

Copyright forms a sizeable portion of the U.S. economy generally. According to the U.S. Department of Commerce, 5.5 million workers are employed in the copyright industries, generating $1.2 trillion of the nation’s GDP. The copyright industries account for foreign sales of nearly $180 billion, making them one of the few U.S. industries with a trade surplus. Overall, core copyright industries make up seven percent of the economy. To protect this large piece of the economy intellectual property rights must be respected, including on the internet.

As iconic as Southern California may be, the Bay Area and the Silicon Valley are the world headquarters for technology innovation – immediately recognizable as the world leader. The state has nearly 1.2 million tech sector employees comprising 7.2 percent of the workforce. In part because of this concentration, California is first in the nation for the most innovation per capita. Millions of jobs in the state are driven by intellectual property rights-based innovation and productivity. But errant public policy choices can put it all at risk.

Continuing the correct balance between owners protecting their property while also allowing internet service providers and web companies, to operate effectively. For twenty years a process called “notice and takedown” balanced the responsibilities in a way that has required that owners seek to protect their content online by alerting web sites if the site’s users are abusing their property. In return this intermediary is to take specific actions to end the abuse.

But now, some claim that the law is outdated and not flexible enough to adequately balance the property owner’s rights with the operations of online business models. They particularly point to places, such as social media, where users have the liberty to post what they like. Sometimes that liberty leads to people infringing on copyrights, using protected material in an illegal way. Content owners argue, not illogically, that social media must fix the issue and protect their property. However, the desired outcome is merely to shift the balance of the current law, placing greater responsibility on intermediaries.

If, over the decades the fair pivot point has shifted, then the system should be modified to reflect the current realities. But that does not mean that one party or the other should bear all the burden of maintaining the internet ecosystem. Property owners should still be responsible for protecting their property even as intermediaries should be helpful to the process when malfeasance is brought to their attention. We do absolutely need domestic and global respect for what is ultimately some of our nation’s most valuable resources. But we also need a legal environment that requires appropriate response of all parties involved.

If the current law is not flexible enough to achieve that balance, then it should be tweaked to get to that point. In California geographic terms the right balance is not in Los Angeles or in the Bay Area, but is likely somewhere around Hanford, “an important commercial and cultural center.” That seems fitting.

Bartlett Cleland is senior fellow in tech and innovation at the Pacific Research Institute.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.