Monday, March 06, 2006

Discovering the gunpowder

CNN online reproduces an AP report that states that "[t]he U.S. Justice Department says it has launched an inquiry into possible price fixing in the burgeoning online music industry". It goes on saying that "[t]he Justice Department would not name the companies it has targeted. "The antitrust division is looking at the possibility of anticompetitive practices in the music download industry," spokeswoman Gina Talamona said Thursday."
Well, its seems that finally, after using a lot of resources to prosecute those that infringed on the "intellectual property" of the big companies, the Feds have realized that the uses and abuses of those intellectual property rights are the ones that deserve to be investigated.
Peter Drahos, in his Information Feudalism (Earthscan Ed., 2002), referred to the relation between intellectual property rights and cartels:

The Sherman Act proved to be a thorn in the side of big business over the
coming decades.

The presence of competition authority made the formation of international
cartels a riskier proposition. The Antitrust Division had lawyers on its staff.
Legal scheming to set up cartels could not longer be so transparent in the way
that the use of articles of association or the trust had been. These
contrivances were too easy for other lawyers to spot. Much denser legal thickets
were needed to hide cartels from the eyes of competition lawyers. These thickets
of rules also had to allow companies to fix price, control production and divide
territories among themselves. As Prindle and others familiar with patent law had
been arguing, patents offered large companies just these possibilities. Patents
were a legally recognized form of monopoly that gave inventors a strong form of
control over the production and price of the invention. Importantly,
restrictions over price and production could form part of the patent license
agreement. Such restriction were in many cases regarded by the courts as a
legitimate form of exploitation of a proprietary right. Attacking patent-based
cartels was far harder for a competition authority, for now it had to face the
argument that it was interfering in the use of private property. The legal
representatives of owners of large intellectual property holdings in the 20th
century worked very hard to remove the stigma of monopoly from intellectual
property. The knew that once the veil of private property was drawn over what
was essentially a state-granted monopoly privilege, it would be much harder
for public authorities to question the nature of the business arrangements that
individuals competitors reached with each other using those privileges. (page 51)

The same can be applied to the expansion that we are seeing in the rights of copyrights holders, so it was time for the Feds to look into it.

It is also true that not only the big companies lawyers are fuelling the expansion, there are many academic lawyers that are doing the same...

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