Monday, May 18, 2009

Piracy Through History – Why it’s good for Society

Thomas Alva Edison in his early piracy days.

I met with Matt Mason last week at the Thinking Digital conference in Newcastle, UK. We discussed the Swedish TPB trial and he had some made very interesting observations: Trace the origins of music, radio, movies, TV and almost any industry where intellectual property is involved and you find piracy at the beginning.

When Edison invented the phonographic record, musicians branded him a pirate out to steal their work, until a system was created for paying them royalties. Edison, in turn, went to invent the movie projector and demanded a licensing fee from those making movies with his technology. This in turn caused a band of filmmaking pirates, among them William Fox, to abandon New York for Hollywood. The reason was more hours of sunshine (most movies in those days was shot in out-door studios), cheap land, weaker unions, more liberal labor laws, and proximity to the Mexican border. When the police raided the pirates they could quickly flee over the border until the coast was clear.

They thrived unlicensed until Edison’s patent expired. These pirates continue to operate in Hollywood legally. William Fox’s startup have became one of the largest in media business: 20th Century Fox.

When cable TV first came about in 1948, the cable companies refused to pay the networks for broadcasting their content. For more than 30 years they operated like a primitive illegal file-sharing network until Congress decided that they, too, should pay for content.

In Europe it was prohibited to have commercial TV and radio – In Sweden as long as until 1987. Radio Luxembourg was the world’s largest commercial station in the 1950s. As it is virtually impossible to prosecute someone in another country (radio or internet) Radio Luxembourg could blanket most of Europe with radio programs for a target group with great spending power and that the traditional national radio stations didn’t care about: the teenagers.

Offshore pirate radio exploded in the 1960s. The Dutch government legislated heavily against radio pirates in 1964 and raided Radio Nordsee by air and sea attack from the Dutch armed forces. That was unsuccessful. Later they became Televisie Radio Omroep Stichting, a Dutch television and radio organization, now part of the Netherlands Public Broadcasting.

The British government legislated heavily against radio pirates in 1967, but BBC launched Radio 1 which mission was to compete with the pirates. They hired the former pirate DJs, like John Peel.

Swedish TV3, owned by MTG Modern Times Group, started out as a pirate. The channel was broadcast from London in order to avoid the tight Swedish advertising rules. When they started TV commercials were prohibited in Sweden and there were serious proposals in 1980s to ban satellite dishes and VHS recorders in Sweden.

There are many more examples of successful pirates become legal successes. (But they would hardly admit they once started out as pirates.)

The pirates are on the wrong side of the law, but they are invaluable for innovation and development in society. By refusing to conform to regulations they believe are unfair, pirates have created huge industries from nothing. But because lax law enforcement these pirates could cut some slack and actually add value to a stagnated monopolized industry. Eventually compromises were reached and new laws created and as a result a new industry developed: the record companies, the Cable TV, the movie industry.

If monopoly laws, like copyright, had stopped all these pirates we would probably live in a world that today look like a giant fundamental religious or political community. No recorded music, no cable TV, no free radio, and a selection of films I rather won’t think about.

Photo copyright: Public Domain, Brady-Handy Photograph Collection (Library of Congress)


Blogger Janne said...

Bill Gates started his company by making a more or less copy of the operating system CPM (but not as good)and it worked out quite well for him, didn´t it?

3:21 AM  

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