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Innovation for the 21st CenturyHarnessing the Power of Intellectual Property and Antitrust Law$
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Michael A. Carrier

Print publication date: 2009

Print ISBN-13: 9780195342581

Published to Oxford Scholarship Online: May 2009

DOI: 10.1093/acprof:oso/9780195342581.001.0001

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Pioneering Peer-to-Peer and Other Disruptive Dual-Use Technologies

Pioneering Peer-to-Peer and Other Disruptive Dual-Use Technologies

Chapter:
(p.105) 6 PIONEERING PEER-TO-PEER AND OTHER DISRUPTIVE DUAL-USE TECHNOLOGIES
Source:
Innovation for the 21st Century
Author(s):

Michael A. Carrier

Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780195342581.003.0006

This chapter examines dual-use technologies such as the VCR, computer, CD burner, iPod, TiVo, and peer-to-peer (P2P) file sharing. It discusses the case of Sony Corporation of America v. Universal City Studios, in which the Supreme Court held that the manufacturer of the Betamax VCR was not liable for contributory copyright infringement. Given the importance of P2P software to current dual-use debates, the chapter introduces the technology and three judicial treatments of it (Napster, Aimster, and Grokster). It shows that the tradeoff between innovation and creativity is not as intractable as most courts and scholars have previously thought. The reason is that innovation, but not creativity, is drastically threatened by the selected test. The chapter introduces three dangers facing innovation: (i) an innovation asymmetry downplays new technologies' future benefits and overemphasizes copyright owners' present losses; (ii) an error-costs asymmetry reveals that a technology's abandonment has a far more drastic effect than its wrongful continuation; and (iii) a litigation asymmetry ensnares small technology makers in a web of complex tests and unaffordable lawsuits. The chapter explores the benefits of P2P technology, including distribution, the “long tail,” and promotion, and it's potentially serving as a counterbalance to the Google search engine and cloud computer. The chapter concludes by recommending a return to the Sony test, as this would foster innovation.

Keywords:   innovation, dual-use technologies, P2P, secondary liability, innovation-creativity tradeoff, CD prices, musician, disruptive innovation, Bit Torrent, Long Tail

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