Does the song remain the same? An empirical study of bestselling musical compositions (1913-1932) and their use in cinema (1968-2007).

• Author: Heald, Paul J.

An influential group of commentators assert that the public suffers when valuable copyrighted works fall into the public domain. One concern is under-exploitation, the possibility that a work without an owner will not be adequately distributed or otherwise made available to the public. According to William Landes and Richard Posner, "[A]n absence of copyright protection for intangible works may lead to inefficiencies because ... of impaired incentives to invest in maintaining and exploiting these works." (1) Congress, (2) the courts, (3) and the Copyright Office (4) all relied on this theory to support recent copyright term-extension legislation. (5) Although the only study testing this theory (conducted after the term-extension legislation had passed and been litigated) casts significant doubt on the empirical assertion of under-exploitation of public-domain works, (6) the effort by copyright owners to win further term extensions continues unabated. (7) The present study confirms doubts about under-exploitation in a more robust empirical context.

A different, and until now empirically untested, claim asserts that popular works falling into the public domain may be over-exploited in two different ways. First, a public-domain work might be "overgrazed," to use the terminology found in the tragedy-of-the-commons literature. (8) Landes and Posner assert that the value of "a novel or a movie or a comic book character or a piece of music or a painting" could be depleted in much the same way as "unlimited drilling from a common pool of oil or gas would deplete the pool prematurely." (9) Second, the value of ownerless works could be dissipated through debasing or inappropriate uses. (10) Although both the overgrazing and debasement theories of over-exploitation are based on empirical assertions about what might happen to works when they fall into the public domain, no empirical studies have yet tested these hypotheses. (11) The present study therefore fills a significant gap in the literature.

Mark Lemley identifies both the under-exploitation and the over-exploitation arguments as "ex post" justifications for protecting works, asserting that both sets of arguments provide a rationale for extending protection without reference to "ex ante" incentives to create. (12) Ex post justifications based on under- and over-exploitation worries stand in the forefront of the worldwide debate over whether copyright terms for existing works should be retroactively extended. (13) Because the standard incentive-to-create rationale cannot justify extending the term of protection for a work that already exists, (14) ex post justifications are driving copyright term-extension debates around the world, and are likely to drive the debate in the United States when the present twenty-year extension runs out in 2018.

Neither the over- nor under-exploitation theories have gone unchallenged. Lemley scoffs at under-exploitation worries, stating that the claim "that control by a single firm is necessary to induce efficient distribution [is] theoretically flawed and empirically unsound," (15) and wondering why there is "some greater need to subsidize [by granting exclusive rights] the making of more copies of Ulysses than the making of more paper clips." (16) Amicus briefs (17) in Eldred v. Ashcroft, (18) including one signed by five Nobel Laureate economists, (19) have also rejected the under-exploitation argument, and my own empirical work concludes that popular books falling into the public domain are not under-exploited in comparison to their copyrighted counterparts. (20)

The over-exploitation theory has also come under attack. (21) Richard Epstein is a doubter, suggesting that "[a]nyone is hard pressed to believe that Shakespeare's star has been dimmed by the calamities committed in his name...." (22) So too are Lemley and Dennis Karjala, both of whom deploy market-based economic arguments to allay fears of a congestion externality caused by overuse of copyrighted works. (23) They conclude that "a belief that the original creator (or his transferee) can best manage the work in the public interest runs strongly contrary to our long-standing and fundamental reliance on free markets to allocate resources to the production and distribution of goods." (24)

Although the theoretical arguments on both sides are interesting, commentators have so far assumed (but not necessarily believed) that works falling into the public domain will be exploited at a different rate than their copyrighted counterparts. Exploitation rates are, of course, observable and ripe for empirical analysis. In Part I of the Article, I explain the methodology of my study of popular musical compositions from 1913-1932 as they appear in movies from 1968-2007. The study tracks songs from 1913-1922 as they fall into the public domain, and compares changes in exploitation rates with songs from 1923-1932 that are still protected by copyright.

Studying musical compositions has several advantages over my prior study of bestselling books. First, tracking the appearance of compositions in movies provides data on the exploitation of derivative works. (25) Musical compositions usually appear in movies as works realized by someone other than the copyright owner. In a movie we hear a recording of the composition, a derivative work under the Copyright Act. (26) Since those worded about over-exploitation inevitably warn against unauthorized derivative works as their most serious potential concern, (27) the study provides especially relevant data. Second, relying on the appearance of musical compositions in movies provides an alternative, and possibly superior, measure of availability to the counting of book editions and book publishers in my prior study. (28) Therefore, the present study's finding of no under-exploitation within my sample is not merely duplicative. Finally, and most importantly, studying songs provides the first opportunity to study claims of over-exploitation.

In Part II, the methodology and the results of the study are reported. Before they fell into the public domain, the relevant set of musical compositions from 1912-1923 appeared in one movie every 15.3 years. After they fell into the public domain, the songs appeared in movies much more frequently, about once every 3.8 years, a four-fold increase. Compositions from 1923-1932, which have always been protected by copyright, appeared in movies once every 7.8 years and 3.3 years respectively, an increase of approximately two and one-half times over the parallel periods of time. The greater rate of increase for the public-domain compositions allays worries of under-exploitation, while the lower absolute rate of exploitation suggests strongly that overgrazing concerns are misplaced. A formal statistical analysis of the data is provided in Appendix B. Part HI joins the theoretical debate and suggests why self-regulation by both producers and consumers of copyrighted works explains the absence of observable market failure. Building on the data gathered here and in a prior study, I suggest when rare cases of over- or under-exploitation might occur. Identifying these cases requires defining the most slippery sort of damage--debasement of a copyrighted work--in a more precise manner than has previously appeared in the literature. The article concludes that addressing any potential market failure requires a much more narrowly tailored regulatory response than general copyright term extension that extends protection to millions of works in order to prevent a theoretical harm to a handful.

1. METHODOLOGY

   Previous studies confirm that most copyrighted works do not hold their value over time. Landes and Posner note, "fewer than 11 percent of the copyrights registered between 1883 and 1964 were renewed at the end of their twenty-eight-year term, even though the cost of renewal was small." (29) They point out that of 10,027 books published in the U.S. in 1930, only 1.7% remained in print in 2001. (30)

   Even those worried about what happens when works fall into the public domain agree there is little reason to extend copyright protection to works with no current value. (31) In fact, extending copyright for those works would entail significant tracing and transaction costs, and would almost certainly be inefficient. (32) Given that no one argues for increasing protection for obscure works, the present study identified the 1,294 most popular musical compositions from 1913-1932 and focused on the seventy-four most enduringly valuable of those compositions as they appeared in movies from 1968-2007. The years 1968-2007 were chosen because the compositions from 1913-1922 began to fall into the public domain in 1988, the mid-point in that timeline. Compositions from 1913-1932 were chosen because the works published from 1913-1922 are all in the public domain, and properly renewed works published from 1923-1932 are all still protected by copyright as a result of the 1998 Copyright Term Extension Act, (33) allowing for a basically symmetrical comparison of ten years' worth of works from each group. Until extension, the effective copyright term for these works was seventy-five years, so works from 1913 fell into the public domain in 1988, works from 1914 in fell into the public domain in 1989, and so on until the 1998 legislation ended the flow of works into the public domain. (34)

   Studying a group of works from approximately the same era provides the opportunity to study what happened to works from 1913-1922 after they fell into the public domain, and to compare rates of exploitation with those works from 1923-1932 that remained protected. The initial data set included 601 of the most popular compositions from 1913-1922 and 693 of the most popular compositions from 1923-1932, as listed in the most accepted compilation of popular historical musical compositions. (35) All of these songs were then tracked in the Internet Movie Database...