This Month in IP Insanity (April 2015)

Now that the academic year is slowing down, I can start to account for all of the developments in IP law and technology again. Here are a handful of events and discussion points for the past month:

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  1. Tidal has turned out to be a bust. Predictably, Jay-Z has pulled all of his music off of Spotify and Youtube, meaning Tidal is the only place where you can access it. As I commented during the odd fanfare of its release – while we’ve certainly increased access costs, I haven’t really seen any big boon to musical innovation, and it’s not clear that any other artists (big or marginal) will flock to Tidal. It’s probably just a rent-extraction system for the musical elite.
  2. More streaming music news — Spotify is lobbyisting up (which somehow doesn’t sound as catchy as “lawyering up”, perhaps that’s for the better). I’ve reported upon Spotify before, in the context of Taylor Swift’s criticism of streaming music. Spotify seems to be preparing to go to war with Apple, the latter of which is preparing to release it’s own streaming service, the newly acquired and revamped “Beats.” At the same time, the DOJ is considering another pass at music licensing regulations, and the blue moon when Congress decides to revamp copyright laws may also be around the corner (due, no doubt, to the fact that 2018 will see the first batch of copyrights to finally expire since 1923).
  3. Another reason Spotify is lobbyisting up, and yet another music streaming news bit, is that Grooveshark has finally streamed its last. From The Atlantic’s subtitle, “Everyone knew you were probably illegal all along,” one wonders how they were able to persist for so long without properly acquiring licenses to all streamed music. Apparently it was “good lawyers,” but even that will only get you so far for so long…
  4. John Oliver set his hilarious investigative journalist sights on patents, specifically patent trolls. [I should add that I watched this live the night before my dissertation defense, taking it as a good omen.] It was a very entertaining piece, highlighting the true cost of non-practicing entities (NPEs) who extract rents from would-be users or innovators who use something the NPE holds a patent on (but the NPE does not actually produce anything). Alex Tabarrok, commenting on a further link to Timothy Lee, rightfully discuss how trolls are not the fundamental problem with the patent system, just one of the system’s most visible and absurd excesses.
  5. Not a news story, but on a related note, I recently read a dated article by Stephan Kinsella arguing that patent trolls are akin to mafioso, who don’t want to actually block competition (like actual patent holders do), but rather keep it flowing so they can just wet their beak. This framework makes actual patent holders, who would exercise their monopoly power and block future innovation for want of rents, actually seem worse than the trolls, counterintuitively. It sounds very similar to Mancur Olson’s stationary bandit being economically superior to the roving bandit model of government. I’m inclined to agree, but the point again is that the system is broken, not those who are exploiting it best.
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  7. Onto cable TV, the market for which was blown open this past month by Verizon FIOS’s announcement that it will finally will break up the famous cable bundle into smaller packages. This is far from a la carte channel purchasing, long held as the ideal from the consumer’s point of view, but not the economist’s, as Verizon will offer several slimmer packages with about 20 channels including the famous broadcasters and ESPN, etc. It will be interesting to see how this affects the cable industry: established players don’t like it.
  8. Our benevolent overlords at Google now want to get into the phone carrier business. Google’s proposed Project Fi will cost $20 a month for talk and text, beyond free Wifi, and another $10 per gigabyte of data used each month. Most interestingly, unused data can be credited to the next month’s quota. While a welcome innovation, Google will have to build up its network and reputation as a carrier beyond simply a software (and limited hardware) company, to compete with the infrastructure of Verizon, AT&T, and Sprint.
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This Month in IP Insanity (January 2015)

In keeping with my new monthly feature, here is this past month’s IP news:

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  1. We know Tom Petty won’t back down. He just won a lawsuit against Sam Smith for infringing Petty’s copyrights on the song “Stay With Me,” requiring Smith to give Petty royalties. This is the third time Petty has sued someone for copyright infringement over similar sounding songs. Perhaps it is because Petty’s music is so fundamental as a building block for Rock n’ Roll that everything starts sounding the same. Either way, looks like Tom Petty is okay with free fallin’, not so much free ridin’.
  2. Not quite a story on the intellectual property wars, but I find it relevant. A Harvard Ph.D student had a manuscript of complete gibberish (literally written with Random Text Generator) accepted in seventeen medical journals. Granted, they are lower-tier journals who spam out email solicitations, and he would have to pay $500 to “process” them, so this isn’t Nature or the New England Journal of Medicine. His paper is entitled “Cuckoo for cocoa puffs? The surgical and neoplastic role of cacao extract in breakfast cereals” and you can read the whole “paper” at the link. Reminds me of the heroic Sokal affair.
  3. Another offbeat story but I find it interesting, television producers no longer focus on the first season as a metric for deciding to produce future seasons. With more people cutting cords, binge watching on their own schedule, and simply waiting for word of mouth to rate shows they’ve “gotta see,” the real money is now in the second season.
  4. If you needed a new casebook study of what was once an innovative industry giant turning to rent-seeking and the political process once they lose their competitive edge, look no further than BlackBerry (formerly RIM). The company wants Congress to pass a law mandating that all app developers must develop a BlackBerry version to go with the more popular iOS and Android versions. Their argument? We should broaden the definition of “net neutrality” to “application neutrality,” meaning developers should be forced to produce for all platforms, no matter how irrelevant and obsolete, in the name of openness. Maybe BlackBerry forgot about the Open Source movement.
  5. As if they were trying to make it harder for me to begrudgingly root for them tomorrow, the Seattle Seahawks are trying to trademark the words “boom,” “go hawks,” and the number “12.”
  6. Taylor Swift, who is transforming me into a hater for her views on music, is trying to trademark “this sick beat” and other catchphrases from her 1989 album, like “Party Like It’s 1989.”  Do people say even that?
  7. Yet another trademark story, this time it’s the MPAA who forced a local Minneapolis brewer to stop selling “Rated R” beer. Apparently, as long as the beer contained the trademarked word ‘rated’ it would still be liable, according to the MPAA. Frankly I don’t really see how consumers are likely to be confused, deceived, or mistaken about the source of the goods or services. Does the MPAA even sell beer?
  8. Torrentfreak posted a link to a new art project out of Australia, Pirate Cinema, which livestreams a collage of videos that people are streaming simultaneously on Bittorent. If you want to try to watch 3 or 4 movies at the same time, try this.
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  10. A revealing natural experiment in Norway. From 2009-2014, Norwegians under 30 dramatically stopped illegally downloading music, from 80% of those surveyed saying they did download, to just 4%. Yet, in that same period, despite the collapse of music piracy (mostly due to legal streaming services), Norwegian music revenues increased just 1.5% in nominal terms (likely negative when including inflation). Maybe piracy isn’t the real problem in the media industries?
  11. Lastly, like a Phoenix rising from the ashes, the Pirate Bay is back. It’s apparent return will disrupt the innovation and competition that’s been going on between spinoffs and rivals like Kickass Torrents and isoHunt, the latter of which recently offered $100,000 to the old Pirate Bay’s most active contributors to boost its publicity. Also, apparently not all of the former TPB staff are happy about TPB’s return.
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