The economics of copyright and the Internet

Technology and the Internet have triggered important changes to how creative works are created and accessed, and how creators and copyright-based industries generate their revenues. During the past decade, digital content markets have exhibited double-digit growth rates across industry sectors and increasing shares of total revenues. In addition, new types of content, novel content producers and innovative ways of manipulating and modifying digital content are burgeoning. This chapter reassesses the economics of copyright in the light of these changes. It starts with an introduction to the economics of copyright followed by an overview of the changes to the baseline copyright economics model and a summary the existing economic literature and resulting data needs. While this chapter focuses on copyright, it is worthwhile noting that other forms of intellectual property rights (IPRs) such as patents, industrial designs and trademarks also matter in the digital economy, both for physical products such as smartphones and tablet computers and for intangible products such as software and social networks. Furthermore, although this chapter exclusively refers to copyright, it is worthwhile clarifying that in addition to copyright vested in authors, international treaties also recognize related rights, vested in performers, phonogram producers and broadcasting organizations.