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Note: this is a slightly edited version of a paper written earlier this year. At some point I’ll make it a bit more ‘bloggy’, but right now I don’t want to. So there.

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“A technology is invented, it spreads, a thousand flowers bloom, and then someone finds a way to own it, locking out others. It happens every time.”

Chris Anderson, editor of Wired

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It took just over a year for e-books on Kindle to outsell paperbacks, with Amazon reporting that for every 100 physical books they sold in January 2011, consumers were downloading 115 digital copies to the device. Twelve months later, and 42 of the top 50 titles on USA Today’s January 2012 bestseller list were e-book editions, with one in five American adults estimated to be accessing their reading material through a digital device. “People who care about literature care about substance and permanence,” wrote Jonathan Franzen, but perhaps they care about convenience and immediacy a little more.

It’s a pattern being repeated across the culture industries. 2011 saw sales of digital music exceed that of CDs and vinyl for the first time,and Spotify ended the year with 2.5 million subscribers choosing to stream their music rather than own it. Revenues from online movie streaming are expected to overtake DVD sales in the U.S. later this year, and sales of new physical video games were surpassed by digital purchases last autumn.On March 5th 2012 Apple announced the 25th billion download from their App Store, less than four years after it was launched.

It’s not just that we’ve developed an appetite for digital content, but that we’re increasingly opting for it over traditional media formats. And those formats are quickly becoming eclipsed by a flood of online services for content delivery, from Audible to Steam to Mubi to Netflix, and new devices on which to consume it. As Chris Anderson wrote in The Long Tail:

“The overwhelming trend of our age is to take products that were once delivered as physical goods, find ways to turn them into data, and stream them into your home.”

In itself this is a positive development, an expansion of choice that benefits audiences and producers alike through lowering the costs of distribution and enabling new opportunities for writers, filmmakers, musicians and video game developers to enter the market. But there are consequences to this new-media Wild West, as technology writer Om Malik has dubbed it – not least in the declining fortunes of pretty much every high-street retailer with a business model based around the sale of physical media content. The last five years have seen the closure of Borders, Virgin Megastore, Zavvi and Tower Records, whilst Game has recently entered administration and HMV and Waterstones face an uncertain future as retail figures continue to fall. The founder of the latter, Tim Waterstone, blames Amazon for their troubles: the head of Amazon, Jeff Bozos, sees the shift to digital as having been inevitable:

“Ebooks had to happen. Infrastructure web services had to happen… For me, it feels like the rate of change on the Internet today is even greater than it was in 1995.”

A recent report from the University of Southern California proposed that “America is at a major digital turning point,” with consumers increasingly adapting to online technology and content delivery. And soon they may have no choice: the authors contend that “most printed daily newspapers will be gone in about five years,” a position echoed by The Guardian as they move forward with their own ‘Digital First’ strategy. Last month the Encyclopedia Britannica ceased physical publication after 244 years, proposing to continue as a digital-only database, and a report from media researchers IHS Screen Digest recently suggested that “We are looking at the beginning of the end of the age of movies on physical media like DVD and Blu-ray.”

Already there’s a wealth of content only available through digital delivery, from add-ons for video games such as Modern Warfare to iTunes’ catalogue of live recordings from their annual summer festivals. The second version of the Kindle launched with a new story from Stephen King available solely through the device, and Amazon have since signed up a stable of authors to publish exclusively through their e-book imprint. Perhaps more significantly, industry developers are currently speculating that the next generation of video game consoles will not feature optical drives, requiring an online connection for all content.

These developments point to an ever-widening digital divide, as our potential access to information and culture becomes more and more dependent upon technology and communication networks. But there’s a further issue raised by the transfer of media from atoms to bits, illustrated neatly by the example of the Kindle editions of 1984 and Animal Farm. In 2009 customers who had purchased the books found that Amazon had removed them from their devices remotely, owing to a rights issue on behalf of the company that had added them to the Kindle store. Whilst customers were refunded, many responded to the move with indignation:

“I never imagined that Amazon actually had the right, the authority or even the ability to delete something that I had already purchased.”

This isn’t an isolated example. In the same year Apple remotely retrieved promotional footage for the film Watchmen from users’ iTunes libraries on Warner Bros’ behest, and various commentators have noted that the iPhone’s software includes the capacity for apps to be disabled without the users’ knowledge. But then, as the End User License Agreement (EULA) for the iTunes Store makes clear, we’re not actually purchasing these products when we hand over our money:

“LICENSED APPLICATION END USER LICENSE AGREEMENT

The Products transacted through the Service are licensed, not sold, to You for use only under the terms of this license.”

The same applies to purchases made through Sony’s Playstation Network and Microsoft’s Xbox Live services: we may be making a transaction in their online stores but we’re not buying any actual rights of ownership. Instead we’re merely being granted access to content, which is very different: indeed, with the latter we don’t even purchase content directly, but through the intermediary of Microsoft Points, a non-transferable virtual currency that restricts our available actions as consumers yet further. As the video game critic Matthew Kaplan puts it:

“Anyone familiar with digital rights management, copyright, and the music industry over the past fifteen years will acknowledge that this is murky territory. We simply don’t own what we pay for anymore. Experiences are more commonly leased to us, even if we never return them. And when we’re done with them, we’re done. They just… disappear.”

Our control over many forms of media content have receded in other ways, too. Whilst social networking and the ease of online file distribution has undoubtedly greatly increased our capacity to share information, a number of the freedoms that we’d have taken for granted just years ago with physical media have been lost within the legalese of digital rights management and closed content systems. With the exception of the Kindle, which grants users the option to ‘lend’ e-books temporarily, we’ve little capacity to share bought content with others – our purchases are locked in to the devices that they’re downloaded to, or irrevocably associated with user accounts personal to us.

Of course, there are ways around this – screen recording, for example, or simply sharing access to our profiles. But as Jessica Litman observed with regards to the U.S. Government’s 1998 Digital Millennium Copyright Act:

“Borrowing your brother’s password so that you can read a publication he subscribes to but you don’t is now illegal.”

In some ways we’ve regressed: the VHS technology of the 1980s enabled us to store recorded television programmes indefinitely, to loan them to others and to access them anywhere with a video player. But VHS recorders are no longer in production, and DVD-R hardware failed to take off against competition from PVR boxes such as Sky+, installed in half of the UK’s households. But timeshifted viewing just allows us to delay our programme consumption, not retain it: we can’t transfer content outside of the device, nor access it remotely. The iPlayer goes further still, giving us just a few days before stored content is deleted, a time limit that reinforces our temporary hold on television programming. More than any other media form it’s here that the shift to digital has had the greatest impact in the relationship between the audience and the content: the programmes that we record are never really ours – they’re transient, ephemeral, lasting only until we need to free up space to be filled with something newer.

Of course, we’ve never actually purchased television content, only the license that permits us to view it, so there are very clear arguments against us being able to possess it at all. But with media such as video games and films, which we do pay for directly, it’s a different matter. With physical content such as DVDs and Blu-Rays we’ve a clear sense of our own rights: we can’t legally replicate or transfer the material encoded on them, but what we do with the disks themselves is largely up to us (public performance notwithstanding). As the University of Stirling’s Richard Haynes puts it:

“Under copyright law, once I have bought a DVD any rights in the disk are said to be exhausted. That is, technically I am able to do as I wish with the disk, as it is mine.”

Underpinning this assertion is the First Sale Doctrine, or as it’s generally known outside of the United States, the Exhaustion Of Rights: a legal concession granting consumers the right to lend, sell or give away a particular lawfully-made copy of a copyrighted work. It’s this that allows the resale markets to operate, and for sites such as eBay to trade retro video game cartridges and second-hand CDs. “Having secondary markets are very important,” said Berkeley Center for Law and Technology researcher Fred von Lohmann in an interview with Wired magazine. “It’s important for me to sell the music that I don’t much like, and then I can plow that money back into the music that I do like.”

It’s a right that, according to von Lohmann, is being eroded by the insistence of copyright owners to control what happens to their content once it has been sold. “In an era of digital envelopes – where the copyright owner determines what you can do with your purchase – we are rapidly moving away from the first-sale doctrine,” von Lohmann said.

There are two main drivers for this: in the shift from physical to digital media, we’ve moved from purchasing a product to, as discussed earlier, merely obtaining a license. This conflicts with the common law interpretation of the First Sale Doctrine, which as the name implies required that an item have been sold for the Doctrine to apply: with media content increasingly being distributed under license the argument from the copyright holders is that no sale has taken place, and therefore no rights have been conferred. However, the Copyright Act of 1976 made it clear (in the US at least) that the right to sell, lend, trade or give away a work applies to any ‘owner’ of that work, regardless of whether a financial transaction has taken place. It’s this that has led to some courts siding against software manufacturers such as Adobe, who opposed the resale and distribution of their products by a third-party.

The bigger issue concerns matter rather than semantics, with what was previously tangible having become intangible – we can’t hold those ones and zeros – which has significant legal implications. As Harvard University’s Berkman Center for Internet and Society state in a report on iTunes:

“Currently, U.S. and European Union law have denied that the first sale doctrine applies to digital works distributed over the Internet, despite good arguments to the contrary… The WIPO [World Intellectual Property Organisation] treaties currently stipulate application of the first-sale doctrine to tangible goods like books and CDs and not to intangible content distributed over the Internet.”

Essentially, we’ve no right to sell the digital content that we buy, even though the cost of digital products is roughly parallel to that of the physical equivalents, if they exist, with which we would still enjoy that capability. In return for the convenience of on-demand media, we’ve surrendered the capacity to pass it on, to share, swap, borrow or trade – to do any of the things, in short, that we’ve been doing since the phonograph. Digital gives us just two options: to keep content, or to delete it.

With physical media, in the majority of cases if we don’t like a product then we can return it. Most record stores offer refunds, and HMV’s store returns policy only excludes PC games that have been opened, since they can be installed onto computers. Bookshops tend to accept returns up to a month after purchase. But with the exception of Kindle e-books, which can be refunded within a week of purchase, customers have no recourse if the digital content that they’ve bought doesn’t meet their expectations. As the iTunes Store Terms and Conditions puts it, “All sales and rentals of products are final.” For Xbox Live, “All sales are final and nonrefundable.” From Amazon.co.uk, “In general, digital content purchased and/or downloaded from Amazon.com is not returnable.” The consumer protections that we’ve become accustomed to in the ‘real’ world simply haven’t been extended to the digital realm.

It’s striking, actually, the gulf that’s developed between our offline and online consumer rights. But perhaps more striking still is how we’ve just accepted this vast transfer of power back into the hands of the gatekeepers. As Richard Haynes writes:

“For many advocates of the empowering nature of digital media, the balance between producers (the corporate media) and users (the consumer, who may also be a potential producer) has been heavily tipped in favour of the former.”

In particular, with Apple’s current stranglehold over both the digital marketplace, through iTunes, and the hardware that it serves, we’re seeing a return of the closed-content system that defined classical Hollywood. As Wired writer Michael Wolff puts it:

“It’s not shocking that Jobs’ iPad-enabled vision of media’s future looks more like media’s past. In this scenario, Jobs is a mogul straight out of the studio system. While Google may have controlled traffic and sales, Apple controls the content itself. Indeed, it retains absolute approval rights over all third-party applications. Apple controls the look and feel and experience. And, what’s more, it controls both the content-delivery system (iTunes) and the devices (iPods, iPhones, and iPads) through which that content is consumed.”

It’s an outlook shared by Wolff’s editor, Chris Anderson, who views the internet as increasingly hosting ‘closed gardens’ of locked-in, heavily-controlled content, and advanced by Jonathan Zittrain in his book The Future of the Internet (And How to Stop It). Zittrain’s argument is that the rise of app-led, tethered appliances such as the iPhone – described as “a product of both fashion and fear” – threatens the generative, open intentions of the Web, narrowing our online activity and restricting innovation. But with industry observers anticipating that smartphones and tablets will become the primary means of accessing the internet within the next year, perhaps the open web isn’t what we want. Maybe we’re perfectly happy consuming more than creating, and trusting gatekeeping entities such as Apple, who have been criticised for censoring iTunes content, to control what we have access to and how we can access it.

“We are returning to a world that already exists,” says Wolff, “one in which we chase the transformative effects of music and film instead of our brief (relatively speaking) flirtation with the transformative effects of the Web.” Only he’s not quite right: consumption in the digital age is not the same as with old media. The music and film that we’re chasing is increasingly disposable, a mere button-press away from oblivion. We carry whole libraries in our pockets, to be lost in a single incautious moment or made obsolete by tomorrow’s technology and an incompatible file format.

On the iTunes store homepage a banner promotes HD films we can ‘Own from £4.99.’ But what does own mean anymore? Only, really, that the video file won’t expire imminently, that, in theory, it won’t be taken away. But, given the examples otherwise over recent years, there are no guarantees.

There’s another, much less pessimistic way of seeing these developments, though. Rachel Botman and Roo Rogers’ What’s Mine Is Yours argues that we’re entering an age of collaborative consumption, rejecting the Western materialism that characterised the late 20th century in favour of more cost-effective and environmentally-friendly approaches to living.

“The relationship between physical products, individual ownership and self-identity is undergoing a profound evolution. We don’t want the CD; we want the music it holds… We don’t want the DVD; we want the film it carries. In other words, we want not the stuff but the needs or experiences it fulfils. As our possessions ‘dematerialise’ into the intangible, our preconceptions of ownership are changing.”

It isn’t that media consumption has become less desirable, but that technology has given us a host of options besides possession of physical content, from on-demand streaming to storage in the Cloud. And the advantages that these bring – an end to scarcity or stock shortage, no more clutter and waste, freedom from the need to care for a disk or carry a paperback and of course the instant gratification of a download – mean that, for now at least, access is more important to us than ownership.

Yet whilst these are all excellent reasons to embrace digital content, there’s a very real risk that in the clamour for this access we’re losing sight of a few too many of our rights. And there’s perhaps a greater concern still: that as media property becomes little more than data in the stream, we’ll lose a sense of its worth as well.

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“It is likely that for a growing number of enterprises and consumers, the very idea of ownership will seem limited, even old-fashioned, twenty-five years from now.”

Jeremy Rifkin, The Age of Access

Christian Cottingham

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