Man Without Qualities

Monday, October 21, 2002

Just a Bit More Bono

Turning again perhaps for the last time to the economic arguments (as distinguished from the textual and more purely legal arguments) against the Bono Act, the Man Without Qualities is struck by the failure of the Act's opponents to come to grips with similar statutes, expecially the body of federal communications law.

The right to transmit electromagnetic signals on a given band of "spectrum" at one time lay entirely in the common domain. Then, in the early part of the 20th Century, governments - notably the United States federal government acting under the Commerce Clause - created a set of exclusive spectrum rights. Spectrum rights have much in common with copyrights. The rights to use a particular piece of spectrum is actually a local monopoly to engage in a particular activity. As the copyright monopoly prohibits anyone but the holder of the right from copying the designated "work," the spectrum rights monopoly similarly prohibits all but the holder of that right from transmitting on the designated frequencies. Both kinds of rights are non-possessory, in the sense that although termed "property rights," there is no natural form of "possession" comparable to possession of real property or tangible personalty. Of course, spectrum rights differ from copyrights in the sense that two people cannot use a single frequency in the same locale at the same time - and in this sense, the broadcaster with the most powerful transmitter might be said to "possess" the designated naturally. But federal law has never assigned any particular significance to this kind of "natural possession." Indeed, although spectrum rights more closely resemble traditional property rights in this way than do copyrights, federal communications law is much more explicitly set up as a regulatory and licensing system for broadcaster behavior than is the copyright law.

And while many economists have many things to say about the economics of spectrum rights and how those rtights should be regulated, there is to the knowledge of the Man Without Qualities no significant economic theory that advocates the economic benefits of terminating such rights automatically after a set number of years. This is particularly striking because the Federal Communications Commission at least theoretically retains vast and technical power to terminate a licensee's rights to use designated spectrum.

So if the economy would benefit from the automatic termination of copyrights in, say, Cole Porter songs written in the 1930's, why wouldn't the economy benefit from the equally automatic termination of the spectrum rights of the broadcasters such as NBC that broadcast those songs right after they were written?

On another note: The transcript of the Supreme Court oral argument is now available. Perhaps I am mistaken, but I do not detect a great deal of sympathy for Professor Lessig's approach in any of the Justices' questioning or comments. Although Justice Scalia does seem a skeptical of at least one argument advanced by Solicitor General Olson.

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