Fair Use Worth More to Economy Than Copyright, CCIA Says

Fair use exceptions to U.S. copyright laws account for more than $4.5 trillion in annual revenue for the United States, according to a report issued on Wednesday by the Computer and Communications Industry Association.

"Much of the unprecedented economic growth of the past 10 years can actually be credited to the doctrine of fair use, as the Internet itself depends on the ability to use content in a limited and nonlicensed manner," CCIA president and CEO Ed Black said in a statement. "To stay on the edge of innovation and productivity, we must keep fair use as one of the cornerstones for creativity, innovation, and, as today's study indicates, an engine for growth for our country."

By one measure -- "value added," which the report defines as "an industry's gross output minus its purchased intermediate inputs" -- the fair use economy is greater than the copyright economy.

Recent studies indicate that the value added to the U.S. economy by copyright industries amounts to $1.3 trillion, said Black. The value added to the U.S. economy by the fair use amounts to $2.2 trillion.

The fair use economy's "value added" is thus almost 70% larger than that of the copyright industries.

The $4.5 trillion in annual revenue attributable to fair use represents a 31% increase since 2002, according to the report, which claims that fair use industries are responsible for 18% of U.S. economic growth and almost 11 million American jobs.

The fair use doctrine allows the use of copyrighted material without a license from the copyright owner.

CCIA members include Google, Microsoft, Yahoo, and many other tech companies that benefit immensely from fair use. The media also benefits from fair use -- quoting the copyrighted CCIA report would be illegal were it not for fair use. The same can be said for anyone who has ever printed copyrighted material from a Web page, sent copyrighted material in an e-mail, or used a recording device of some sort to capture copyrighted audio or video.

According to the U.S. Copyright Office, use of copyrighted material may be considered fair use based on four criteria: "the purpose and character of the use, including whether such use is of commercial nature or is for nonprofit educational purposes; the nature of the copyrighted work; amount and substantiality of the portion used in relation to the copyrighted work as a whole; and the effect of the use upon the potential market for or value of the copyrighted work."

However, assuming a use qualifies as fair use remains a gamble. The distinction between fair use and infringement isn't easily defined, as the Copyright Office puts it. Companies like Google, which has been sued at least four times so far this year for copyright infringement, know this all too well.

Black said his organization's aim in releasing this report is to encourage lawmakers to recognize that copyright legislation requires balance. "What it points out is there's an important chunk of the economy that's impacted by what happens to copyright law," he said. "It points out to some extent ... that when you focus on only one side when making policy changes and don't recognize that, you're going to have a collateral impact on the other side."

"Copyright was created as a functional tool to promote creativity, innovation, and economic activity," said Black. "It should be measured by that standard, not by some moral rights or abstract measure of property rights."