Page 33 - A Study on the Role of UGC Platforms in Copyright Law：An Intermediary-oriented Approach

Chapter 2 Copyright in the Pre-Internet Age: An Intermediary-oriented Approach

Chapter 2 Copyright in the Pre-Internet

Age: An Intermediary-oriented Approach

2.1 Introduction

Copyright law has long been criticised for its intermediary-oriented approach, which
1*
has been blamed for undermining creators’ interests and public welfare. For one thing,
intermediaries have reaped the lion’s share of revenue, whereas the creators have barely
received a fair return. For another, copyright intermediaries have been granted control over
2
the work. Dominated by economic incentives to maximise revenue, intermediaries have tried
to exert control over every use. This not only impedes the public’s access to knowledge,
3
it destroys the social mechanism by which knowledge is accumulated by copying and re-
4
creation. It may also work against the creators’ incentive to build a reputation by loosening
5
control and widening the distribution of works. No mechanism is perfect. Despite the
negative effects of copyright intermediaries on creators and users, this thesis argues that the
intermediary-oriented model is still justified. Its significant advantages secure the copyright
owners’ revenue and preserve the end users’ freedom to access and use copyrighted works
for non-commercial purposes.
This thesis takes the position that copyright law is dominated by two categories of
intermediaries: producers and distributors. This is a bit different from Jessica Litman’s

* This chapter, especially the historical study in Section 2.3.1~2.3.3 , is based on the article ‘Taking Users’ Rights Seriously:
Proposed UGC Solutions for Spurring Creativity in the Internet Age’ published in the Queen Mary Journal of Intellectual
Property, Volume 9 (2019) co-written by the author’s supervisor Prof. Yahong Li and the author. Compared to the earlier
version, the concept, substantive content, structure and expression of this chapter has been substantially updated based on
the valuable suggestions of Prof. Yahong Li and the developments in copyright legislation, judicial decisions and scholarly
writing during the past year.
1 Jessica Litman, ‘Real Copyright Reform’ (2010) 96 Iowa Law Review 8, 18; Joost Smiers and Marieke van Schijndel,
Imagine There is No Copyright and No Cultural Conglomorates Too: An Essay (Institute of Network Cultures 2009); Siva
Vaidhyanathan, Copyrights and Copywrongs: The Rise of Intellectual Property and How it Threatens Creativity (New
York University Press 2001); L. Ray Patterson and Stanley W. Lindberg, The Nature of Copyright: A Law of Users’ Rights
(University of Georgia Press 1991).
2 Start-up artists generally receive 8% the suggested retail price of the recording. However, to make up for the loss of the
reserves returned from record stores, recording companies hold back a portion of the artist’s royalties, usually about 35%.
Furthermore, recording companies have continued the practice from the days of vinyl records when 10% of the artist’s
royalties were held back because 10% of the vinyl records were broken during shipping. Although vinyl has become
outmoded, this tradition has remained. Lee Ann Obringer, ‘How Music Royalties Work’ (HowStuffWorks) <https://
entertainment.howstuffworks.com/music-royalties6.htm> accessed 1 November 2018.
3 Guy Pessach, ‘Copyright Law as a Silencing Restriction on Noninfringing Materials: Unveiling the Scope of Copyright's
Diversity Externalities’ (2003) 76 Southern California Law Review 1067, 1067.
4 James Boyle, ‘The Second Enclosure Movement and the Construction of the Public Domain’ (2003) 66 Law & Contemporary
Problems 33, 34.
5 Lawrence Lessig, Remix: Making Art and Commerce Thrive in the Hybrid Economy (Penguin 2008) 150.

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