More Unfair Claims About Fair Use in Australia

Abstract

This paper extends an earlier review of five studies that have been used by a number of large companies and private advocacy groups to promote major copyright policy changes in Asia Pacific. The earlier paper identified how some of the key arguments used by the proponents of these changes were based on faulty or misleading interpretations of data. This paper reviews a new report that has been recently released, written for Google, and authored by Deloitte: Access Economics (2018). This review again isolates a number of false claims being made, this time about the economic effects of fair use in Australia, including four key flawed assertions in the paper. Assertion 1: that substantial downstream value is lost as a result of current copyright law in Australia. The downstream uses of copyright works involved include: text and data mining, digital analytics, cloud computing, transformative, educational and informational uses involving existing copyright works. Assertion 2: that this downstream value is lost due to current copyright law in Australia reducing cumulative innovation, and that Fair Use can remedy that. Assertion 3: that creativity is booming in the digital world and that introducing Fair Use in Australia will benefit creative output. Assertion 4: that transaction costs would be lower under a Fair Use system. As we shall discuss this presents an unbalanced picture of the likely impacts of adopting Fair Use in Australia, the nature and extent of the real current market problems, the scope for market solutions to the alleged problems, the nature and role of copyright and of transaction costs. The paper is indeed based on a fundamental misinterpretation of copyright. It fails to adequately acknowledge that copyright merely requires the creator's consent, and provides the basis for a market in creative works and does not prevent use. The paper then does not adequately explain why any copyright market might be expected to fail in the manner alleged, nor why the proposed legal intervention (fair use) might be expected to improve outcomes. The paper also doesn’t present any real new evidence, particularly drawing on the so-called “big data” that must now be available on digital copyright market transactions. A more useful contribution would further have examined the practical limitations of licensing markets, and the extent to which these might be addressed by new digital technologies, such as artificial intelligence and distributed ledger technology in order to enhance creative market growth, investment and innovation.