This was originally posted on the Shapeways website as part of a series on legal concepts important for 3D designers and 3D printing.

This is the second in a series of posts about different types of rights that may be involved with models and files here at Shapeways.  Today we’re going to go a bit deeper into one aspect of one of those rights: fair use of copyright-protected work.

Before we begin, a quick note.  The posts in this series are written from a U.S. perspective.  Most of them are written in a way that the general concepts will apply in many (if not most) other countries.  That is probably the least true for an issue like fair use. While some other countries have similar concepts such as fair dealing, fair use tends to be a bit U.S. specific.  As is the case for all of the posts in this series, it is always a good idea to talk to a lawyer about your specific case.

Generally speaking, if you want to make a copy of all or part of a work that is protected by copyright you need to get permission from the person who owns that copyright (often referred to as the “rightsholder”).  But that is not always the case.  Sometimes you can make copies without permission because the copies you are making are protected by a concept in U.S. copyright law known as fair use.

Fair use is an important, although slightly complicated, aspect of copyright law.  Without fair use, a rightsholder could prevent a critic from quoting part of a work in a critical review, stop a news report from showing a clip of a controversial video, or interfere with fans reimagining characters from a favorite work of fiction.  Fundamentally, fair use is designed to make sure that copyright does not get in the way of free speech.

Applying that fundamental principle to any specific situation can be a bit complicated.  Fortunately, there are a number of great guides out there to try and help, from the Fair Use App from New Media Rights, to a massive collection of best practice guides from the Center for Media & Social Impact at American University, and Stanford University’s Copyright and Fair Use Center (just to name a few).  All of these resources build on the four elements that courts are supposed to consider in determining if a use is a fair use. These are written into U.S. copyright law.  Remember that these factors are weighed against each other, and that no single factor can determine if fair use applies.

1. The purpose and character of the use, including whether the use in question is commercial in nature or nonprofit and educational;

This element looks at how a work protected by copyright is going to be used by someone else.  Generally speaking, uses that are noncommercial, critical, and/or educational will fare well in this element.  However, there are still plenty of commercial uses of copyright-protected works that can be protected by fair use (watch pretty much any segment on the Daily Show for an example).

2. The nature of the work being copied;

If the first element looks at the copy, this element looks at the work being copied and recognizes that some types of works are more likely to trigger fair use protection.  For example, a speech given by a political candidate is generally riper to be reproduced under the protection of fair use than a commercial television show.  Again, however, that general rule does not mean that commercial television shows are exempt from being remixed under fair use.

3. The amount and substantiality of the portion of the copied work that is used; and

Contrary to what you may have read elsewhere, there is no “rule of thumb” for fair use, where as long as you use below X percent of a work of less than Y seconds of a clip you are protected.  This element looks at the amount of the source work that is used in the context of the new use in question.  It can be thought of as a rule of “take only what you need.”  Sometimes that is only a few words.  Other times it can be that the entire source work is neededto achieve the new use.

4. The impact that the copy has on the potential market value of the copied work.

This final element looks at how the new use impacts the source work economically.  If the new use directly competes with the original work in the marketplace, it may undermine its case for fair use.

When judges are trying to decide if a use is a fair use, they weigh the facts against all of these elements.  Importantly, these principles aren’t a straightforward checklist – sometimes fair use can be found when three of the principles cut against a finding of fair use but the fourth is particularly persuasive, and sometimes one or two of the principles do not even apply to the specific situation.

Where does this leave you?  First and foremost, fair use is real.  Not every use of a work protected by copyright requires permission, and fair use is like a muscle – the more it is used the stronger it gets.  Second, rightsholders – even ones acting in good faith – don’t always consider fair use as thoroughly as they should (or at all).  Don’t assume that just because you receive a copyright takedown notice that the rightsholder who sent that notice considered the fair use aspects of what you are doing.

That being said, fair use can be complicated.  Simply saying that “no infringement is intended” or not being able to get a license from a rightsholder does not give you fair use protection. Neither does simply wanting to use a work.  If you are going to claim fair use, make sure you understand the basics of how it works.  Take a look at some of the guides mentioned above to get a better sense of how the rules apply to situations similar to yours.  The exercise of coming up with answers for each of the four fair use elements can be incredibly helpful in understanding how fair use applies to a given situation.  Consider discussing your specific case with an attorney who can focus on and identify any important details.  This is doubly true if you are planning on asserting fair use in a formal legal context, such as a counternotice to a copyright takedown here at Shapeways.

photo courtesy petful

(This post originally appeared on the Shapeways blog)

A: Copyright law, of course.

There is a new legal decision by the Sixth Circuit Court of Appeals in the United States that brings together cheerleading uniforms and 3D printing.  It isn’t a game changer – the decision doesn’t fundamentally rewrite legal rules – but it does shed some light on what is likely to be one of the thorniest issues around 3D printing and intellectual property law: a copyright concept known as severability.  The question addressed by the court was seemingly straightforward: are the decorations on cheerleading uniforms a critical part of their functionality?  The way the court found an answer to that question will help us understand what types of 3D printed things are – and are not – protected by copyright. 

I clicked on the link but now am thinking I don’t want to read all of this: what’s the short version?

Severability is the test that US courts use to figure out which parts of things that are both functional and decorative can be protected by copyright (if any).  There is now a new test to determine this in part of the United States.  The test itself (arguably the tenth test currently being used) doesn’t bring a lot more clarity to the issue, but is an excuse to walk through how all of this works.  Most of this blog post just explains how the court applied the test in this one case.

Still with me?  Let’s go!

Background Point 1: Useful vs. Creative

As explained in the Introduction to Rights and Protections post, there is something of a divide between objects that are eligible for copyright protection and objects that are eligible for patent protection.  Creative objects can get copyright protection while functional objects can get patent protection.  In theory these two categories are mutually exclusive.  In practice, some objects can be a little bit of both.  Courts use “severability” to try and determine if the mixed elements of a single object can be separated out and protected individually.

Oh, and as a general matter clothing and uniforms are considered a functional object – they keep you warm and not naked.

Background Point 2: Severability

While a lamp is a useful article, the leg sculpture that forms the base of the lamp can be severed (both physically and conceptually) from the lamp’s utilitarian function and given independent copyright protection. Image from flickr user Spider.Dog.

Severability is key to understanding copyright protection in objects that mix functional with non-functional items.  As a general rule, functional items do not get copyright protection. However, if a court can sever non-functional elements from functional elements, those non-functional elements can be protected by copyright.  This severability can be “physical” (because the parts can be physically separated from each other) or “conceptual” (because the parts can be conceived of separately from each other).  All of this stuff is covered in more detail in the What’s the Deal with Copyright and 3D Printing? whitepaper.

Enough – What is This Case About?

Cheerleader uniforms.  A company named Varsity Spirit designs and sells cheerleader uniforms.  Their uniforms include colors, stripes, chevrons, and other patterns.  Star Athletica makes cheerleader uniforms with similar combinations of colors, stripes, chevrons, and other patterns.  Varsity accused Star of copying their uniforms and brought a copyright suit against Star.  Star responded that it could not infringe on Varisty’s copyright because the patterns on the uniform where not eligible for copyright protection.

Essentially, Star said that Varsity’s patterns were functional parts of the cheerleader uniform.  They helped mark the uniform as a cheerleader uniform as opposed to, say, just a pleated skirt and tank top.

That’s what makes this a severability case.  Varsity says that the patterns are severable from the utilitarian uniforms and therefore should be eligible for copyright protection.  Star says that the patterns are a core part of the uniforms which cannot be severed – and therefore cannot be protected by copyright.

How Did the Court Work Through This?

Severability is easy(ish) to explain but hard to apply in specific circumstances.  After noting that there are at least nine (listed on pages 17-19 of the opinion) different tests of severability in use, the court decided to come up with its own 5(ish) part test.

  • Part 1: Is the design in question something that could be protected by copyright?

Yes. In this case the court decided that the work Varsity registered with the Copyright Office was a “pictorial, graphic, or sculptural work, ” which is the type of thing protectable by copyright.

  • Part 2: Is the design of a useful article?

Again yes.  Uniforms are a useful article. Their use is to “cover the body, wick away moisture, and withstand the rigors of athletic movements.”

  • Part 3: What are the useful aspects of the article?  Importantly, “conveying information” doesn’t count as a use.

The court decided that the designs on the uniforms were primary intended to convey to people that it was a cheerleader uniform.  Unfortunately for Star, in this court’s opinion “conveying information” like that doesn’t qualify as a useful purpose.  I think it is fair to say that this is not a universally held opinion among courts.

  • Part 4: Can the viewer of the design identify the artistic features separately from the useful features?

The court found that it could.  The designs on the uniforms did nothing to help cover the body, wick away moisture, or withstand the rigors of athletic movement.  As such, they were unrelated to the core functionality of the uniform.  This is where the answer to part 3, and how you define the functional elements of the uniform at the start of the analysis, becomes important.  Once the court decided that helping to identify a uniform as a cheerleader uniform didn’t count as a useful function, it was hard for them to find any other way.

  • Part 5: Can the designs exist independently of the useful object?

This question is really the core of the analysis and, truth be told, the first four parts don’t help answer it very well.  The court walked through a bunch of sub-questions to try and answer this part.  Ultimately they decided that the same designs could exist independently of the uniform and could, for example, be transferred onto things like jackets or pants (or a framed wall hanging).

As a result of all of this, the court found that the designs were severable from the uniforms and therefore wereprotectable by copyright.

What Does All of This Have to do with 3D Printing Again?

Although this case was about uniforms, it isn’t hard to imagine applying the same analysis to 3D printed dog cupsor tea light holders.  Understanding if a 3D printed object is protected by copyright becomes an important question if someone is copying it without permission.  If the object is protected by copyright, that copying may be infringement.  If the object isn’t protected by copyright, there may not be very much the designer can do.  When you are thinking about building on some existing 3D model (or someone has built upon or copied your model) it is important to have a sense of how it may and may not be protected by copyright.

And if you think that this all feels a bit too complicated you are not alone.  In a dissent, Justice McKeague reflected upon the multitude of ways that someone could think about severability and declared that “the law in this area is a mess.”  He then went on – with some reason – to call on either the Supreme Court or Congress to straighten all of this out.  While severability remains important, until either the Supreme Court or Congress clarifies some  things, actually applying it is going to remain a challenge.

Super Copyright + Administrative Law Nerd Bonus

The court declined to grant the Copyright Office’s decision to register the works Chevron deference as to whether or not the designs were copyrightable.  That’s one more example of how the Copyright Office isn’t really an administrative agency with actual rulemaking authority.  If this paragraph is gobbledygook to you, you can safely ignore it and go on with your life.

(This post originally appeared on the Shapeways blog)

Shapeways designers create a mindboggling array of objects every day.  This diversity fosters a vibrant Shapeways community and makes Shapeways shops exciting places to explore. It also means that models on Shapeways can potentially involve a number of different types of intellectual property and other rights.

Sometimes this rich diversity of rights can be a bit confusing and overwhelming.  In an attempt to bring a bit of order to the rights chaos, today we’re kicking off a series of blog posts that try to briefly describe a handful of types of rights that might touch upon models on Shapeways.  Today’s post will cover the high level basics.  Future posts – they’ll be coming up every fortnight or so – will dive a bit deeper into issues raised by these rights.  We’ll try to link to all of them from this post in the future so you can find them all in one place.

(If you want a slightly more in depth – but still written for designers who are not lawyers – explanation for how all of these things fit together, you might want to check out these three whitepapers).

((This series is for educational purposes only and is not legal advice. This area of law tends to be maddeningly fact-specific, so if you have a specific question it is always wise to talk to a lawyer who understands your circumstances.))


A drawing of a pig dancing with children is protectable by copyright.

If you are familiar with one kind of intellectual property right, it is probably copyright.  Copyright is designed to be an incentive to produce artistic, creative things.  Here on Shapeways that can mean things like sculptures, figurines, and jewelry.  Importantly, copyright generally does not protect functional items like mechanical parts or brackets and connectors (those are the domain of patents, described below).

You do not need to apply for a copyright in order to have copyright protection (although there are advantages to registering – something that you can do here.). As long as the thing you have created is of a type that is eligible for copyright protection, it is protected by copyright from the moment it exists.  Copyright protection will generally last for the life of the author plus 70 years after her death.  Copyright also allows for independent creation – if two people come up with identical models without copying each other, each one gets their own copyright protection for their model.

Copyright mostly governs the making of copies of a protected item (that’s where the “copy” in copyright comes from).  Traditionally this focused mostly on ‘literal’ copying, like making an exact copy of an entire book or origami crane skeleton.  However, copyright also governs the creation of ‘derivative’ works. These aren’t necessarily exactly copies, but rather are copies that are derived from some protected work. A classic example of this is creating a “copy” of a book by turning it into a movie.  There are important exceptions to these general rules (fair use probably being the best known) that we will cover in future blog posts.


A dynamo is the kind of invention that is protectable by patent.

Patent is designed to be an incentive to produce “functional” innovations.  Contrast this with copyright – those mechanical parts, brackets, and connectors that I said were not eligible for copyright protection are the types of things eligible for patent protection.

Also in contrast with copyright, you do not get a patent automatically just for creating something that is functional and original.  You need to apply for a patent in order to get patent protection.  If you get it, that patent protection generally lasts for 20 years.  Unlike copyright, patent law does not allow for independent creation. That means that once you have a patent, anyone who practices that patent will infringe upon your patent even if they didn’t know about it beforehand.

Generally speaking, someone infringes on your patent by “practicing it” – that is, doing what the patent describes – without your permission.


You can trust Aspinall to sell a product that is “absolutely non-poisonous” so look for their trademark on the bottle.

Copyright and patent are both awarded as incentives to create and share innovation.  While trademark is often lumped in with copyright and patent as “intellectual property,” its purpose is quite different.  Trademark is all about consumer protection.  When you see a trademark on a product, that trademark means that the trademark owner stands behind the product.

As a result of this different purpose, trademark rules can feel very different from copyright and patent rules.  In copyright and patent, infringement usually comes in the form of copying or using the protected creation.  In trademark, infringement is usually judged by a “likelihood of confusion” standard: is it likely that a given use of a trademark would confuse a consumer into thinking that the trademark owner is standing behind the use?  Does the use make it seem like the object is from or endorsed by the trademark holder?  If so, the use may be infringing on the trademark.

Right of Publicity

TR might not like it, but as a public, newsworthy figure Puck is not violating his right of publicity even when they use his image to sell magazines.

Right of publicity is also a bit out of the intellectual property mainstream, but it is worth mentioning here.  Right of publicity is all about being able to control how your image is used commercially. In the US it is based in the right of privacy.  Generally speaking, if you are leveraging someone’s identity for commercial gain you may be infringing on their rights of publicity.

There is at least one noteworthy exception to this general rule.  In the United States we don’t want the right of publicity to smother the type of free expression protected by the First Amendment.  As a result, the more you are using someone’s likeness to comment on or criticize them – and this is especially true if that someone is a public figure – the less likely you are to be infringing on their right of publicity.

Just an Introduction

This post is designed to be an introduction to some of these concepts and, as a result, just scratches their surface.  It leaves a lot of things out that may or may not be relevant to a specific case.  Some of those things will be addressed in posts further into this series.

If there are issues that you would like addressed in future posts let me know in the comments or on twitter@MWeinberg2D.  We can’t address specific legal disputes, but we can explain how some of these pieces fit together.

David Byrne’s op-ed in the Times on Sunday got me thinking about the importance of information sharing in online music services.  In that spirit, I decide to throw up this unpublished whitepaper from 2011-12 on ways forward for online music licensing.  Central to the idea is complete transparency on who is consuming what.  It provided a way for unlicensed services to become licensed and to minimize the economic value of unauthorized music distribution.  It certainly has its flaws (it fails to appreciate the importance that labels put on pricing different songs differently, which may or may not be a legitimate thing to consider in this context) but I’ve always kind of been partial to it.  Remember that at the time this was written Spotify had pretty much just launched in the US and its licensing situation was from from clear.  Anyway, for posterity’s sake here is the text of the whitepaper.  It never had a title.  

The fundamental idea is that instead of subscribing to a service, you subscribe to music.  You can take your music subscription to any service that offers you music in an interesting ways.  That way, instead of competing on the licensing deals that services can cut, services compete on being good at helping you to experience and discover music.


           The music industry provided many people their first opportunity to consider how the internet would impact existing industries.  Napster became synonymous with the first widely recognized internet “crisis.”  The RIAA, the lobbying organization representing record labels, has been a driving force behind both strengthening digital copyright laws and enforcing those laws in court.  However, even as the internet has moved from novel to commonplace, after almost fifteen years the music industry has not yet fully come to terms with the realities of digital distribution.

           Although the music industry was one of the first industries to be impacted by widespread consumer access to the internet, it has lagged behind others in finding ways to adapt to the new connected digital landscape.  In fact, “avoid being like the music industry” has become something of a guiding principle for other industries facing similar digital disruption.

           Period of Stability

           That is not to say that the music industry[1] has not taken important steps towards engaging with the internet.  Compared to the apocalyptic rhetoric and wall-to-wall litigation of the early 2000s, the current online music landscape appears to be relatively stable.  It is easy and convenient to pay for music files from services such as iTunes and Amazon.  Google, Amazon, and Apple (among others) are beginning to offer consumers ways to stream their music collection on demand from an internet connected device. Grooveshark,, and Spotify give consumers on-demand access to a wider range of tracks.  Pandora creates customized radio stations for each individual user.

           This stability does mask problems, however.  Compared to many internet sectors, the online music landscape is not diverse.  Large companies dominate the market for purchasing music downloads. There appear to be few, if any, opportunities for startups to enter the pure download market. Even Apple’s “revolutionary” iTunes store simply met a need that had been clearly expressed by consumers for years. Only in the music industry are such late-to-market developments like selling single tracks and albums digitally online considered milestones.  

           Streaming is similarly hobbled.  Large incumbents are just beginning to offer consumers the option of streaming the consumers’ own music collection online.  Smaller companies trying to offer similar services have been smothered by lawsuits.[2]  Services such as Grooveshark and, unlikely to be able to negotiate full licenses with major record labels, rely on a combination of relatively untested legal theories and limited licenses to protect themselves from liability. Pandora struggled unprofitably for years, fighting with record labels for an economically viable licensing agreement. Even Spotify, the darling of the online European music world, took two years to negotiate its stripped down entry into the United States market.  Even now the “successes” in this area are trailed by complaints from many sides regarding any number of issues.

           There is a reason that there are so few truly successful startups in the digital music world: licensing.  For the vast majority of music startups, it is simply impossible to negotiate an economically viable music license.  For this reason, veteran venture capitalist Tony Conrad has compared investing in digital music startups to fighting the Vietnam war.[3]  

           The music industry has been unable to tap into the startup culture that is creating thousands of new killer apps and exciting services.[4] These apps and services would increase demand, interest, and engagement in music, hopefully to the benefit of all involved.  The music industry is largely left out of the energy, excitement, and engagement of the digital world because it has not found a way to come to terms with the services that make that world spin.

           Why Can’t the Industry Support Innovation?

           There is no inherent reason that the music industry should be unable to support innovation and change.  Many parts of the industry are in an almost constant state of change: new genres and artists are continually appearing to upend existing mainstays.  Major labels have entire departments devoted to constantly discovering new content.  It is clear that the music industry does not hate change and innovation in and of itself.

           However, the music industry is having a hard time coming to terms with the best way to embrace the internet. Faced with diminishing profits, record labels are constantly in search of a new digital revenue stream.  Unfortunately, labels also expect this stream to be able to restore revenues to industry high water marks.  If a new opportunity does not offer a clear path towards hundreds of millions of dollars in revenues, many labels do not think that it is worth their time.  Similarly, labels are worried that striking a smaller deal with a service that proves to be very popular and profitable will cause them to lose out on the next big thing. Essentially the record labels, like many industries, is haunted by the fear of waking  up one morning to realize that they have traded analog dollars for digital pennies.

           This caution has made record labels reluctant to incubate new music startups that could compete with their existing (but declining) offline revenue streams. They insist that startups pay steep advances, guarantee minimums, and accept licenses that force them to operate under slim margins and restricted feature sets.[5]  Ambiguity surrounding which types of licenses are required for various types of offerings further complicates the terrain.

           The shortsightedness of this strategy becomes more apparent by the day. The record labels are rapidly moving towards a point where they no longer have to worry about trading analog dollars for digital pennies because only analog pennies remain.  Furthermore, the labels are beholden to a handful of large online companies (especially Apple) that were able to meet the licensing terms in the past.  Instead of a diverse landscape of companies offering a multitude of music related services online, most digital music income is reliant on Apple, and to a lesser extent Amazon.

           Until the record labels find a way to make it easy for music startups to innovate and grow, while at the same time paying for the use of recorded music, this pattern is likely to continue.


           The absence of a straightforward, easy to obtain blanket license for online music distribution prevents the music industry from fully monetizing the strong desire of music fans to consume music online.  It also effectively prevents the large number of application developers that want to distribute music online from acquiring necessary rights (or even identifying which rights are necessary).  If those developers do manage to acquire those rights, the absence of a reliable license creates a looming threat that success will result in crippling licensing fees.  This paper describes a workable framework for a blanket license for online music.

By design, this system allows all of the parties in the music industry to focus on what they do best.  Artists can focus on making music.  Labels can focus on nurturing and promoting talent. Collective rights organizations can focus on tracking, collecting, and distributing money.  Equally importantly, it brings a new party into the industry: application developers.  The license allows developers to focus on designing new ways to get people interested in music (and interested in paying for music) instead of negotiating complex licensing agreements.  The public will be able to purchase a license and be allowed to access music however they see fit.

Briefly, the proposal is for a voluntary collective license.  Users pay a monthly fee to a digital content licensing organization.  In return, they get a username and password that they can bring to third party services to access music in any number of ways: streaming, downloading, curated stations, etc.  In exchange for reporting usage statistics to the digital content licensing organization, any third party can get permission to distribute music.  However, third party services do not receive a percentage of the license fee: they are responsible for creating other revenue sources. The digital content licensing organization then distributes the collected fees to artists proportional to public consumption.


By providing the public with all of the music they want, delivered in the manner they prefer, while at the same time creating a dependable revenue stream for artists, this license will serve as a way for the music industry as a whole to embrace digital distribution.  As an additional bonus, it will avoid making the industry uncomfortably dependent on one corporation or entity for its profits.

           Nature of the License

The license will be voluntary.  This aspect serves a number of important goals. First, it is the only politically feasible way to create the license.  Rightly or wrongly, the digital public does not trust the music industry. Imposing a required fee on all Internet connections, or all digital devices, or on anything else, will be seen as an attempt by a struggling industry to tax innovation.  This perception will be compounded because, if a mandatory fee were to be imposed on the public by the music industry, other industries (such as the news, movie, and publishing industries) would quickly insist on a similar fee.

Second, the parties responsible for collecting a mandatory fee are unlikely to enthusiastically participate.  ISPs have expressed skepticism about involvement in any sort of fee collection, be it voluntary or mandatory.  Becoming the fee collectors for the music industry, and essentially becoming the public face of a potentially disliked program (if it is mandatory), is unlikely to appeal to any intermediary.

           Third, a voluntary license provides a check on the music industry.  Customers will feel that they have the power to opt out of the license if they are no longer interested in acquiring new music. Although such opting out is unlikely to occur in large numbers, simply having the option to stop payment will go a long way towards public acceptance of a license fee.  

Finally, a voluntary license allows people who are not interested in music to avoid paying for it.  If a consumer is interested in music they can pay for music. If they are uninterested in music, they can avoid doing so.  While the percentage of people who are completely uninterested in music is relatively small, such people do exist.  Financially supporting musicians cannot be a prerequisite for Internet access. The music industry does not want to be regulated as a public good, and therefore can not have the power to impose general taxes for support.

Creation of Third Party Applications

           One of the most important parts of the collective license is that it will allow for the creation of a diverse group of third party applications and stores dedicated to convincing people to become more engaged with music.  The history of music-related online startups clearly illustrates that there is a great deal of interest in creating new ways for fans to connect with music.[6]  However, most of those attempts have foundered on the rocks of licensing agreements. By removing delicate licensing negotiations from service creation, a blanket license will quickly lead to scores of new music-based applications.

           Although the license will allow licensees (the public) to acquire music from wherever they please, it will not automatically absolve third party services of liability for assisting in that acquisition.  Services will need to comply with a handful of simple requirements in order to obtain their license to distribute content to members of the public licensed to receive it.

           The most important of these requirements will be to report the activity of its users to the digital content licensing organization.  This reporting will be done in an aggregated, anonomized way that will reflect which songs are being accessed, but not in a way that would compromise the privacy of individual users.  The digital content licensing organization would establish a standardized reporting process that would allow services to automatically deliver usage data.  This data would be used to calculate payments to artists and rightsholders.

           Another requirement would be that users log in to use the authorized services. When users pay for their license, they will receive login credentials (i.e. a username and password).  In order to access online music services, the consumer will enter those credentials.  This validation process could occur once (associating a license username and password with a specific account on a specific service) or on an ongoing basis (using the license username and password as the login credentials for a specific service).  Existing fraud protections could largely prevent a single account from being shared between large numbers of individuals.

           Beyond these relatively simple and easy to implement requirements, third party applications would be free to distribute music however they see fit. This would make it easy for existing black market applications to become legitimate, licensed communities capable of attracting investors (if they were so inclined).  Applications could offer track downloads, track streaming, curated radio stations, custom mix tape downloads, or any other way they chose to package music.  Because applications would not receive a percentage of the license fee, it would be up to them to develop a profitable business model.

Scope of the License

           The license must include both downloads and streaming of tracks.  While there may have been a time when there were clear distinctions between downloading and streaming music, that time has clearly past.  Any number of services now allow consumers to stream entire music collections on demand to connected devices.  Although there are important distinctions between downloading and streaming in the context of track ownership, innovative services should have the ability to combine these offerings as freely as possible.

           Both downloads and streams should be covered by the license.  That does not mean they should be compensated identically. The compensation section (below) will address how best to accommodate these differences when allocating payments to artists.

           Point of Sale

One potential place for consumers to purchase their license is with their primary Internet connection as an addition to their monthly bill.  After all, some sort of Internet connection will be a prerequisite for using the license. The license will be billed in monthly cycles.  It will cover an entire household, just as Internet service does today.

           However, ISPs as a point of sale are not ideal.  In many instances, customers have at least two ISPs – wireless and wired. Being asked to purchase a license twice could lead to confusion.  

Instead, the license could be offered directly to consumers by the digital content licensing organization.  Although allowing consumers to purchase the license directly from the digital content licensing organization might have a negative impact on the initial subscription rate, in the medium and long term it could prove to be a more sustainable model.  It would also remove a burden from ISPs and simplify the payment chain.


It is reasonable to assume that the vast majority of users would migrate to “legitimate” platforms once they are available. This would occur both because new, attractive services would appear and because many existing darknet services would incorporate the license into their operation and “go legit.”  Among other things, this would allow these services to attract a broader, more lucrative set of advertisers.

As a result, most of the use data would come directly from the information that apps reported to the digital content licensing organization.  If this did not occur, the per-use counting could be augmented with statistical sampling techniques from other sites.  Of course, the digital content licensing organization would also implement measures to combat clickfraud and other attempts to artificially influence the data.


           The digital content licensing organization will allocate payment to rightsholders based on the percentage of downloads and streams that each work received over the course of a period of time (such as a month).  Streams will be weighted less than downloads, in a ratio to be determined in the future.  The distinction between the two will be a simple, straightforward rule such as “if the song can be accessed without an Internet connection, it is a download.”  The fixed ratio model will allow third party services to offer the public downloads, streams, or both, and to change the allocation according to market demand without having to fear being crushed by new licensing fees.

           The Digital Content Licensing Organization: Rights Clearance and Division of Funds

The digital content licensing organization must be an independent, transparent, nonprofit organization.  Its board would be a mix of artists, labels, service providers, and others adequate to give all parties confidence in the organization.  It will be responsible for creating and maintaining an authoritative database of rightsholders, and for making that database accessible to the public.  The organization will create open, standard ways for third party applications to submit usage data.  It will also collect funds from users and distribute those funds to rightsholders. In order to accomplish this task, the organization will retain a percentage of the licensing fees to cover expenses.  Finally, the organization would have the power to set the license fee paid by the public.

Unresolved Problems

           While the blanket license solution is an attractive one, implementing it will not be without challenges.  None of these challenges are insurmountable, but they must be dealt with in a realistic and transparent manner.

           Creating the Index

           The description of the solution simply assumes that there is an accurate way to match songs used by services with parties who should be compensated for that use.  Although conceptually straightforward, today this process is far from easy.  In addition to the fact that music tracks involve two distinct copyrights (one for the underlying musical work and one for the actual performance), ownership for each of those copyrights is often subdivided between numerous parties.  Ownerships can be transferred in ways that are poorly documented and hard to determine. Companies with ownership interests can go out of business, and individuals can die without their estates in order.

           It is no understatement to describe the creation of a universally inclusive, accurate index of music rights ownership as a holy grail of online music.  The fact that such an obviously useful tool does not exist well over ten years into the online music story is a testament to how hard it is to create.

           That does not mean, however, that it is impossible to create.  The information needed to populate the index exists today, scattered across various organizations and companies. Organizations like ASCAP and Harry Fox Agency have indexes that they use to license works every day.  Record labels generally have the information necessary to license performances in their catalog.  The challenge is to find a way to convince all of those organizations to share their information, and then standardize and unify what they share.

           Dealing with Non-Licensed Works

           Without statutory backing, the license must be a voluntary license. That means that artists would be free to choose to join the license or to not join the license.  As a result, it is possible that some artists would remain outside of the scope of the license.

           Of course, this problem is not limited to the license discussed in this paper. Existing collective rights organizations, such as ASCAP and BMI, also offer blanket licenses that are voluntary. While some artists could theoretically decline to license their songs through ASCAP and/or BMI, prowl the streets waiting to hear their songs performed publicly, and then sue the establishment for copyright violation, in practice this rarely happens.  

There is a simple reason for this – signing up with ASCAP is an easy way to guarantee a revenue stream from public performances of a work.  Instead of patrolling the world for copyright violations, the artist can focus on making music.  Also, the ubiquity of being “in” the license means that licensed music is effectively cheaper than music outside of the license.  Once a business owner has paid for an ASCAP license, any money paid to license other music is an additional expense.  

           Ideally, the same dynamic would occur with the license proposed in this paper. The digital content licensing organization would control a large pot of money, and be looking to distribute that money. Most rightsholders would see the value in participating in that process and focusing on music, instead of going it alone and patrolling the internet for violators.

           Streaming/Downloading Price Differences

           The fees paid to the digital content licensing organization would be distributed proportionately to rightsholders.  It is legitimate to consider how to take into account the real differences between streaming and downloading when making this calculation.

           As noted above, defining the difference between downloading and streaming can be complex, but simple rules of thumb could be applied.  The key distinction could turn on the accessibility of the file when the device is not connected to the internet. Alternatively, it could rest on what happens to the file if the user stops using the service.  True ownership of a file that persists after service cancellation is more valuable than access conditioned on paying monthly fees.

           In any event, the ultimate question is not necessarily how to define the distinction between streaming and downloads, but rather how to set the compensation rations.  How many streams of a song should count as one download?  This negotiation may be somewhat easier than it has been in the past because the result will not result in increased costs for users.  Instead, the outcome will only impact the percentage of the funds collected that will be distributed to a specific rightsholder.



This kind of sharing agreement where fans pay for music, artists get paid, and innovators can innovate in a predictable licensing environment is an intuitively attractive solution to many of the challenges in today’s music industry.  It is, unfortunately, by no means an easily implemented one. However, the goal of this whitepaper is to succinctly describe a possible solution in hopes of giving all parties a single goal to work towards.

Naturally this is not the first time such a solution has been proposed, nor will it be the last.  Neither is it the only possible solution.  Artists are by their nature creative, and the internet gives them a near limitless sandbox in which to experiment with new business models. New labels are forming with the goal of working with the opportunities presented by the internet. Some innovators are finding ways to raise funds and obtain licenses within the existing systems. And, finally, there are people within major labels who are working hard to orient their companies towards the new reality.

The transition from analog to digital is never easy, and the music industry is no different.  It is perhaps the music industry’s unique bad luck to find itself at the nexus of a history of sloppy record keeping, a legal structure that grants powerful rights in a diffuse group of people, and a product that was one of the first to be easily distributed (both legally and illegally) online.  Real change will require coming to terms with all of that, and much more.



This proposal is not the first to try and address the problems facing the music industry online and, regardless of the hopes of the author, it is unlikely to be the last. Similarly, the ideas expressed herein are build largely on the ideas of others.  For other thoughtful examinations of the music licensing issue, you might consider starting with any or all of the following:

Fred von Lohmann, A Better Way Forward: Voluntary Collective Licensing of Music File Sharing, Electronic Frontier Foundation, (2008)

William W. Fisher III, Promises to Keep: Technology, Law, and the Future of Entertainment, Stanford University Press, Chapter 6, (2004)

Rethinking Music: A Briefing Book, The Berkman Center for Internet & Society at Harvard University, (2011)

Eddie Schwartz, Legalize File Sharing, The Mark, (2010)  

Ian Rogers, How About This Instead of SOPA? My Proposal for Legislation to Proactively Combat Piracy While Encouraging and Open and Innovative Internet, FISTFULAYEN (2012).

[1] This paper is focused primarily on the recorded music industry.  This is because recorded music was traditionally the economic engine of the industry.  A number of studies suggest that, while revenue from recorded music is in decline, other revenue streams such as touring are actually increasing and replacing that lost income. See, e.g. Michael Masnick & Michael Ho, The Sky is Rising: A Detailed Look at the State of the Entertainment Industry (2012), However, although the decline of the recorded music industry is not synonymous with the decline of the music industry as a whole, it is significant.  The proposal made in this paper is an attempt to find a sustainable way to monetize recorded music online.

[2] See, e.g. the original

[3] Sarah Lacy, Ask a VC: “Investing in Music Is a Little Like Vietnam”  (Feb. 25, 2011) at 19:23.

[4] Experiments like OpenEMI and Cantora Labs are certainly encouraging, but fall short of a full-scale commitment by the industry. Furthermore, while musicians can (and are) free to experiment online, doing so today generally means turning away from the label system.  Among other things, this can make it harder for the artist to provide a centralized contact point for easy licensing.

[5] For an excellent discussion about the challenges associated with creating a music startup, see Dalton Caldwell’s 2010 presentation to Y Combinator’s Startup School available here: See also Michael Robertson, Why Spotify can never be profitable: The secret demands of record labels, (Dec. 11, 2011).

[6] One notable example of many is Björk’s iTunes app Biophilia,

The most surprising thing to me about working at Shapeways so far is how people respond to copyright takedown notices.  In fact, it is fundamentally changing the way I think about online copyright debates.

Before I came to Shapeways I worked on online copyright policy issues, so I thought I had a pretty good understanding of the copyright notice and takedown process.  A user uploads a file to a website like Shapeways. A brand sends Shapeways a notice claiming that the user is infringing on their rights.  Shapeways takes the file down and tells the user.

In the classic model, this process gives the user a choice: she can recognize that she is probably infringing and keep the file down, or she can claim that the brand is wrong to order the file down - maybe because of fair use, maybe because she has a license, maybe because the brand just picked the wrong file by mistake - and order it back up.  There is a lot of nuance lost in this model (many people who should challenge takedowns are intimidated by the legal process and don’t, for one), but it is still the classic textbook model for how the process works.

While this model plays out every day, there is an additional option that I didn’t fully appreciate: the user recognizes that they are infringing but desperately wants to be put in contact with the brand so she can get a license.  She wants to find a way to partner with the brand, sharing revenue and working together.  In many cases, the takedown notice is a gift because it is the first time she has been able to communicate with anyone from the brand at all.

A Third Way

The online copyright debate is often characterized by two archetypes: the unrepentant pirate and the stifled free speaker. The unrepentant pirate works hard to undermine global creativity by making music, movies, and everything else freely available online without regard for consequences.  The stifled free speaker (or, if you prefer, proud mother sharing videos of her child with her family) is unjustly silenced by overzealous copyright owners.  

There is a truth in each of these, while at the same time each paints with too broad a bush.  But focusing on this dichotomy masks a third, growing category: the eager partner.  

The eager partner does not lurk in the shadows of the internet, motivated by a desire to make all copyrighted content available for free. Neither is she making expressive use of content in a way that does not require approval from brands.  Instead, the eager partner is consciously building on existing IP – often IP that she has a deep emotional connection to – in a way that probably does require some sort of license agreement.  

She is not trying to hide from the brand.  She does not think that the brand’s opinion of what she is doing is irrelevant.  The eager partner wants more than anything else to become an official partner of the brand, and is more than happy to send the brand a percentage of her revenue in exchange for doing so.  She just doesn’t have a way to make that partnership happen.  (These characteristics set her apart from the rich trove of fan artists whose work is protected by fair use). 

Potential Win Win With Partnerships and Licenses

Today, brands are failing to take advantage of these eager partners.  The eager partner is not trying to avoid the brand – the eager partner wants to work with the brand.  There are obvious benefits to this sort of partnership.  For the eager partner, there is the ability to share – and sell – their creations with full approval from the brand.  The eager partner also gets a deeper connection to the brand they love enough to use as a basis for their creativity.

The brand benefits as well. In the short term, the brand gets to avoid the awkward situation of threatening a super fan with legal action. The brand also gets the benefit of the eager partner’s market research and testing.  No matter how big a brand is, it will never be able to imagine all of the products that might find a market online.  That means they are not producing things that could be making them money.  3D printing enhances the cost of that limitation because it even allows a market of 5 or 500 to be met profitably.  In aggregate, these products can drive significant licensing fees.  If fans are selling products, a brand will get a cut of each of those sales.

Trying Something New

This is a slightly different way of doing business, and it won’t be as easy as waking up one day and deciding to do it.  Embracing fans means giving up bit of control.  However many benefits that loosening of control may bring, giving up a bit of control is always hard.  

Traditionally, transaction costs have also been a barrier to this sort of agreement.  Dealing with large numbers of fans – some of whom will not be bringing in large numbers of dollars – can be logistically time consuming and expensive relative to the value created.  

Fortunately, neither of these challenges have to be deal killers.  I’ve argued for a while that brands can set up straightforward licensing rules while reserving the right to pull licenses for fan creations that make them feel uncomfortable.  That helps reduce transaction costs by standardizing agreements and avoid awkward or controversial creations by making it clear to eager partners what the rules are.

Oftentimes, giving up a bit of control is just what is needed to reinvigorate and inspire a fan base. Even a small amount of attention from a brand can go a long way in strengthening the relationships with their fans.  Also, there is no need to open the floodgates immediately.  Starting with a handful of trusted fans can give brands the ability to test the waters and learn what is possible.