Lessig on Fair use and Network neutrality

Larry Lessig has an interesting post on the parallels between fair use and network neutrality. Here is a brief excerpt:

[I]n a fundamental sense, fair use (FU) and network neutrality (NN) are the same thing. They are both state enforced limits on the property rights of others. In both cases, the limits are slight — the vast range of uses granted a copyright holder are only slightly restricted by FU; the vast range of uses allowed a network owner are only slightly restricted by NN. And in both cases, the line defining the limits is uncertain. But in both cases, those who support each say that the limits imposed on the property right are necessary for some important social end (admittedly, different in each case), and that the costs of enforcing those limits are outweighed by the benefits of protecting that social end.

While the comments to his post touch on a number of differences between FU and NN, the point is not that FU and NN are identical in all respects, especially in terms of how either might be implemented. Of course on the finer details of implementing either or both, there is plenty of room for nuanced opinions, criticism, and doubts about uncertainty, costs, benefits, and so on.

The point is that FU and NN are based upon very similar fundamental principles, and not surprisingly (at least once you make the connection), FU and NN encounter very similar opposition (from what I have called a Demsetzian view of property rights, although I was told recently that I should be saying neo-Demsetzian). In the post, Larry discusses the difficulty in understanding those that categorically support one (FU or NN) and oppose the other.

I think Larry is absolutely right about FU and NN being the same fundamentally. Let me further tease out what I think is shared by FU and NN:

Both FU and NN serve an important allocative function – – (1) restricting private control over resources, (2) to structure a participatory environment and sustain socially valuable activities and the spillovers that such activities generate, (3) because a market allocation system without FU or NN would structure the environment differently and diminish participation in such activities. (For more on this, see papers on spillovers and infrastructure)

8 thoughts on “Lessig on Fair use and Network neutrality

  1. I hold the radical view that the United States would look pretty much the same had the tragedy-of-the-commons argument never even have occurred to Demsetz. Who needs it for FU and NN?

  2. No one. That’s not my point. I am pointing to the Demsetzian argument that the primary function of private property rights is to internalize externalities, eliminate spillovers, and allow the market mechanism to work its magic. (This is sometimes but not always connected to a tragedy-of-the-commons argument.) FU and NN are opposed on nearly identical grounds because both act as limitations on private property rights and sustain spillovers (i.e., limit property owners’ ability to capture spillovers).

  3. I’m not so sure about this, Brett. (Of course, some of it depends on how you define NN.) The way I see NN, it would preclude entire categories of private arrangements–it’s a restriction on how one can enjoy, use, and exploit a property right. FU places restrictions on the right to exclude on a case-by-case, generally non-categorical basis. I would see the proper analogy as NN is like compulsory licensing that cannot be contracted around.

    Nevertheless, the analogy depends on what is being analogized. Is NN a basic rule of no deliberate interference with packets, or does it impose a duty to supply the same positive benefits to all packets? I’m not sure the latter would be a real issue, but for the pigheaded actions and comments of a few (ISP blocking Vonage and SBC’s CEO making extortionate noises toward Google).

  4. Mark, I agree with you that FU and NN are implemented differently: E.g., in simple terms,

    NN = rule, FU = standard;
    NN came to exist via norms + technological architecture but may need governmental support to survive, again in the form of a rule (although some are calling for a standard approach)
    FU came to exist via common law and was codified in statute as a standard

    I acknowledge that these (and other) differences in implementation may lead to different opinions on the desirability of FU and NN, and perhaps also to different suggestions for improving FU and NN–e.g., some argue that NN should be applied on a case-by-case basis more like FU; some argue that FU should consist of more clear cut rules; etc.

    My point in the post was that both FU and NN serve a similar economic function, which I happen to think is important but underappreciated, especially in the NN debate. (I’ll skip restating it again.)

    Also, I think you may have overstated the impact of NN and/or understated the impact of FU on private ordering. NN is a nondiscrimination rule, and yes, it would (should) preclude private arrangements that discriminate among packets on the basis of the packets’ end-use (i.e., content or application). But I don’t think it is quite comparable to compulsory licensing. Network owners do not have to make their networks available for everyone to use. They can go purely private and not use their facilities to interconnect with and provide access to the Internet. NN is a principle that applies to Internet traffic. Moreover, NN does not come close to fixing the price the network owners can charge. Network owners retain flexibility to arrange their affairs, compete in markets for applications and content, employ bit rate pricing (or some form of bandwidth discrimination) to deal with bandwidth intensive applications, etc.

    Both NN and FU “preclude entire categories of private arrangements” (if by “preclude” you mean prevent, render undesirable, etc.). The main difference is when and how we know what is included in the categories (NN tells us ex ante, FU tells us ex post). Of course, I suppose you could say that FU does not “preclude” private ordering at all because copyright owners regularly work around FU with contracts, DRM, etc. Besides begging a separate set of questions regarding FU (not worth exploring in this comment), this is largely a function of the costs of litigating fair use. In any event, when it comes down to it, FU precludes some categories of private arrangements that would exist in the absence of FU.

  5. We could go about 20 different ways with this, but I’ll try to speak your language: I suppose that net neutrality preserves ISP networks as infrastructure. I’m not sure fair use serves the same function with respect to copyrighted works. (I would guess here that you are working out your concept of ideas as infrastructure.) Although fair use can help make expressive works more “infrastruture-ish,” it strikes me that norms and compulsory licensing do a better job of that. Fair use is less certain, more case-by-case.

    Does your concept of infrastructure include some notion of persistence, certainty, and clarity? Those might be secondary characteristics, but they would seem to be important to me. If I want to use an input to do further downstream creation, I would think I need to be able to identify it and know whether I can use it. Fair use is a safety valve, but hardly anything on which I would base a business. Compulsory licensing, on the other hand, is reliable and general. I know that I only have to pay the fees to re-broadcast a show or to cover a song. To my thinking, fair use is just too uncertain of a rule on which to base infrastructure. I thought MP3.com and its firm (Cooley) were fools to rely on fair use. I was right. Google is similarly crazy. You cannot operate under such conditions of uncertainty. Now maybe if we could create some sort of financial instrument to hedge the risk–fair use futures?–then fair use could facilitate infrastructure.

    But maybe I’m adding too much of my own stuff here. It’s your theory!

  6. Good points. I should clarify something. I am not arguing that fair use is the best means for sustaining common access to infrastructure, such as ideas. Sometimes fair use does serve this function, but not always, and certainly when it does, not always the most effectively. There are other doctrines within copyright law, such as idea-expression, that better serve this end in most cases. Still, I do think that at times, fair use does it well (e.g., reverse engineering). This really is a seperate conversation.

    But fair use does preserve common access to and use of expression (not necessarily infrastructural expression) for a range of uses that generate spillovers and for which users’ willingness to pay for access and use rights would under-represent social demand — this is similar to the demand side argument for categorically sustaining common access to certain infrastructural resources, such as the Internet, that support a wide range of productive activities that yield a mix of private, public and nonmarket goods.

    Re, persistence, certainty, and clarity, I need to think about how those characteristics map. They may work rather well in evaluating what rule/standard to design, how to structure the legal regime, and how decision makers will respond to the legal system.

  7. Brett and Mark,
    Sorry to be late to this conversation. I heard Larry make this case in person at Princeton late last week, and I told him afterward that I disagreed. At least I think that the differences between the case for net neutrality (which I support) and fair use (which I also support) are greater than the similarities. I’m still working this out in my mind, but I’m mapping the “layers” principle for internet analysis onto IP (law’s IP, not the net’s IP). That is, in the internet, there’s a layer for content, and for transport, and for logic, and for physical assets. For law’s IP, there’s content, and logic, and physical assets (at least — it’s not clear to me that there is transport, though if you blended IP and telecomm, as in cable and satellite licenses, then you have transport as well). In their respective systems, do fair use and net neutrality operate at comparable layers? I don’t think so. Fair use is in part an element of content, and in part (a la the infrastructure claim), part of the next layer down. Net neutrality is clearly at least one layer below content. Somewhat related to fair use, then, in a layers sense, but also distinct in important respects.

  8. Very interesting discussion. I would just chime in that the “essential facilities doctrine” also seems relevant here. I suppose it’s not that vital a doctrine in antitrust law, but who knows, perhaps a future administration will revive it. The antitrust point is suggested in Berners-Lee’s opening quote in this piece:


    The Michael Carrier article on parallels between limits on property and limits on IP also supports the analogy Brett’s drawing.

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