Information Gets What it Wants

So Viacom sues Google/YouTube, seeking $1 billion in damages for copyright infringement. The blogosphere goes nuts. The usual suspects have the usual response. Larry Lessig objects. Mark Cuban cheers. Umair Haque says something provocative. Etc.

Why is anyone surprised? The shocking thing, to me, was that Google had so much success buying off and negotiating with the major media companies after it purchased YouTube. Those companies appreciate that they are making “bet the company” decisions. They risk handing the keys to the kingdom to someone else, as IBM did when it gave the DOS monopoly to Microsoft, and Yahoo! did when it gave handed its search capability to Google. On the other hand, the smart executives in the content industries (and believe me, they do exist) understand they can’t if they stick their heads in the sand and hope that online distribution and user control go away. It’s a high-risk game of chicken. And legal uncertainty is part of the equation.

There is a well-known legal aphorism that “hard cases make bad law.” In this case, we’ve already got a bad law. Two of them, in fact — the 1996 Telecommunications Act and the Digital Millennium Copyright Act. I’m not sure the courts, however they decide, will necessarily make things worse. Maybe the Viacom lawsuit will be settled, and maybe it will just reinforce the ongoing ambiguity of the Napster and Grokster decisions. Or maybe it will provide a bit of clarity in a muddled, muddled situation.

But here’s the good news. The smart money here is playing a long-term game. Whether copyrighted material gets onto YouTube or iPods without authorization isn’t important in the grand scheme of things. It’s just the surface tension stirred up by a deep destabilization of the media value ecosystem.

The real question is what comes next. What funds the production of good and worthwhile and valuable content, especially the critical subset that is both popular and expensive to produce? (And yes, I know those are loaded words.) There will be multiple answers, but few if any of them are operational and proven today. Information goods, and especially experience goods, are not just about transactional efficiency. The “products” themselves are made of the same raw material — networked digital bits — as the mechanisms that move and transact them. Recursivity begets complexity.

It’s a hard, hard question. But it’s one I’m confident will be answered. It has to be. As Stewart Brand famously said more than 20 years ago, information wants to be free… but information also wants to be expensive. And, if I could add a corollary, it’s this: information eventually gets what it wants.