Barely Legally

Confessions of a Moot Court Bailiff

Netflix VPN Followup

From Twitter, some questions from Friend of the Blog Miranda regarding my last post on Zone Shifting:

How does one define location? Where are you “located”, for example, if you’re in EU but have credit card with an American address?

And what about a free market argument when you just want to watch something that’s not legally available at that time in that location? Or if it’s not available at all?

Location, location, location

The short answer to the first question is that you’re located in your physical location, and you’re getting that country’s version of Netflix with the stuff Netflix has licensed for that country.

The long answer: every nation sets its own copyright regime with its own copyright law. When you’re in Foreign Countrystan, they decide whether the movie you’re trying to watch has copyright protection or not. That sounds like a terrible idea, and it’s an incredibly terrible idea. In fact, the Western World realized this back in 1886, back when people took like three baths a year.

So ten countries signed the Berne Convention, an international agreement to honor copyrights in each others’ countries. Today, we’re up to 168 countries which have signed on. There are a number of other copyright agreements, like WIPO and TRIPS and BLORP (don’t look that last one up), that harmonize other aspects of copyright between countries. The general takeaway is that location doesn’t matter in copyright as much as you might think it does.

So you’re in Foreign Countrystan, and everything you watch is subject to those copyright laws. Copyright agreements in the age of mass media are a little funny because they carve up everything imaginable. Heck, in 2009, Verizon got sued for selling ringtones on the theory that Verizon was publicly performing copyrighted songs by making its customers’ phones ring. The music publisher thought that Verizon should have to pay extra to make ringtones ring.

Big media companies don’t sell the worldwide right to stream anything. They parcel out the rights on a country-by-country basis. They’d do it block-by-block if they thought they could get away with it.

The Free Market Argument

As regards the second question:

And what about a free market argument when you just want to watch something that’s not legally available at that time in that location? Or if it’s not available at all?

That’s the same kind of argument that the author of the unauthorized Catcher in the Rye sequel made. “Look, the market wants more Holden Caulfield, and I know there aren’t any legal ways to get it, but come on.” It didn’t work. The fact is that copyright grants creators a monopoly on their works, and there are only two ways around that monopoly.

Fair Use is the first one, and the Public Domain is the second. We already touched on Fair Use in the last one, and there’s this guy I know who explained the Public Domain a few weeks back:

Basically, if authors get to be the only ones to make money off their creative works for a while, more people will make more stuff. Then, after the author has made all his or her money from the work, the work becomes public domain and everyone gets to use it for free forever. This trade-off dates back to the very first law creating copyright for authors, England’s Statute of Anne in 1710, which was passed “for the Encouragement of Learned Men to Compose and Write useful Books.”

The Statute of Anne gave authors fourteen years (plus another fourteen, if they asked for an extension) to make their money back; this Encouragement of Learned Men meant they would Compose and Write more than they would otherwise, whilst any idiot with a horse could run around and sell bootlegged copies of your useful Books. When it came time to come up with a copyright law, America—itself invented the previous year—followed the English model: fourteen years plus another fourteen years, BYOHorse, etc.

Copyright lasts a century-plus these days, but the basic premise is the same. The film studios have a monopoly in 168 countries on their movies, and nothing on Netflix today is going to be in the Public Domain anytime soon.

There’s one last possible way in which the free market could possibly sneak back into the equation, though.

Orphan Works

As I noted above, copyright lasts a long, long time. It doesn’t end when the author dies—it gets handed down like an heirloom—so this leads to some interesting problems, like orphan works. Orphan works are works that are copyrighted, but no one knows who the copyright owner is. Maybe my grandfather wrote a book, and when he died, the copyright to that book passed from him to my father, and when my father dies, I’ll inherit the copyright. It’s quite possible that I, the current copyright owner, don’t even know I’m the copyright owner. This makes it difficult (read: impossible) for other people to know who the copyright holder is.

For example, take basically the entire decade of the 1990s. Video game companies sprung up, popped out some games, and were bought out or went bankrupt the next week. Who knows who owns the copyright to some of these games? (That’s a trick question: lots of the most popular games are in fact made by companies that are still around.) None of those games have sold a copy in a decade or more. They might as well all be orphaned.

So this is where the “free market” comes in. All this stuff just sitting around, and no one’s using it? That’s a market just begging to be disrupted. Sure, it’s morally dubious, but it’s smart; think of it as the copyright equivalent of trespassing in a ghost town. What you’re doing is illegal, but it seems like catching you would be more trouble than it’s worth. That’s not much of an endorsement, though.

Conclusion

So if you’re Netflix’s lawyer, and they found some cool orphan works movies, what do you tell them? “Sure, I bet the current copyright holder wouldn’t mind! Maybe they don’t even know they have the copyright.”

Would your answer change if I told you that each infringing movie or episode that Netflix streams would be punishable by a $150,000 fine? A Netflix account costs about $8 a month, so that’s about 1,560 person-years of Netflix fees to make up for that one orphan work, if it turns out to not be orphaned.

The fact is that our copyright regime extends copyright for an awful long time, so nothing is being added to the public domain. Simultaneously, there are extremely stiff penalties for copyright infringement, so gambling is a frightening proposition. You just aren’t going to see companies like Netflix rolling the dice on these kinds of situations.