Page 245 - A Study on the Role of UGC Platforms in Copyright Law：An Intermediary-oriented Approach

A Study on the Role of UGC Platforms in Copyright Law: Chapter 8 Concluding Remarks
An Intermediary-oriented Approach

Chapter 8 Concluding Remarks

8.1 Re-intermediation in the UGC Age

The Internet is known for disintermediation, especially in the field of copyright due to
1
the elimination of cost in making and distributing physical copies. Nevertheless, according
to classic business theory, intermediaries are required in the value chain because they
can bring customers necessary information such as the features, cost and availability of
2
products. Thus, intermediaries are needed as long as the transaction cost they generate does
not exceed the amount they save customers. Network technology has dramatically decreased
3
transaction costs, which in turn have created economic room for more intermediaries. That
4
is why Kevin Kelly described the Internet as ‘a cradle for intermediaries’.
Ori Brafman and Rod Beckstrom considered intermediation as a necessary step for an
industry wanting to take in profits. Brafman and Beckstrom compared a disintermediated,
5
decentralised organisation to a starfish, which is flexible but inefficient at coordinating a
variety of resources. However, an intermediate, centralised organisation is better analogised
to a spider that has a competitive advantage in fulfilling extensive collaborations across
7
6
different sectors for making profits. Only a spider structure can maximise profits, which
explains the spawning of UGC platforms, MCNs and other intermediaries with the
commercialisation of UGCs.
Courts have recognised individual users and online intermediaries as two primary
8
players in the online environment. Compared with previous studies, which have placed
more emphasis on exempting individual UGC creators from copyright infringement liability,
this thesis focused on the liability of intermediaries, particularly UGC platforms. The

1 Mark Cooper, ‘Digital Disintermediation and Copyright in the 21st Century: Lessons from the Transformation of the Music
Sector’ (Consumer Federation of America, November 2013) <https://consumerfed.org/pdfs/Digital-Disintermediation-and-
21st-Century-Copyright.pdf> accessed 18 June 2019; Dan Skolnik, ‘Private Use out of Control: Disintermediation in the
Music Business, While the Bands Play On’ (2000) 5 Intellectual Property Law Bulletin 13.
2 Kevin Kelly, New Rules for the New Economy: 10 Radical Strategies for A Connected World (Viking Penguin, 1998) 97.
3 Ibid 100.
4 Ibid.
5 Ori Brafman and Rod A Beckstrom, The Starfish and the Spider: The Unstoppable Power of Leaderless Organizations
(Penguin 2006) 97.
6 Ibid 18, 36.
7 Ibid 63.
th
8 See Fair Housing Council of San Fernando Valley. v. Roommates.com LLC, 489 F.3d 921, 925 (9 Cir., 2007) cited by Niva
Elkin-Koren, ‘User-Generated Platforms’ in Rochelle Dreyfuss, Diane L. Zimmerman and Henry First (eds), Working within
the Boundaries of Intellectual Property (Oxford University Press 2010) 85.

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