[Blue_Nose]

Advice To Hasbro On The Scrabulous Kerfuffle

Posted by Mitch Wagner, Aug 1, 2008 12:28 AM

Let's do a little thought experiment for the benefit of Hasbro, the company which owns Scrabble and is trying unsuccessfully to kill Scrabulous. Let's argue the proposition that corporations should ignore most copyright violators, attempt to negotiate a settlement with the most outrageous few, and never, ever, sic the lawyers on pirates. Don't fight piracy. Try to make it work for you instead.

At first, that sounds like a pretty outrageous assertion. After all, everybody knows that companies have to protect their intellectual property, and adopt a take-no-prisoners approach to pirates.

However, I can't find evidence to support this common wisdom. It's easy to find examples of companies that have succeeded while accommodating pirates, and other companies that are failing while aggressively pursuing intellectual property theft.

Let's start with the music industry. Those companies have been in the forefront of litigating to protect themselves against music piracy. And it's just not working. Music sales dropped 8% to $19.4 billion last year, a 10-year low, according to a study by the International Federation of the Phonographic industry. The report goes on to say that "tackling online piracy is essential to the industry's fortunes" -- which is an astounding leap to precisely the wrong conclusion. The industry has been "tackling online piracy" for a decade, and it's just not working. More tackling online piracy is not the answer. Maybe the answer is ignoring online piracy, or co-opting it and making it part of the business model. Cory Doctorow has some ideas, of course.

Hasbro seems to be following the music industry's example. Scrabulous, an electronic version of Scrabble, has proven hugely popular on Facebook. Hasbro owns Scrabble, and it's been fighting to shut Scrabulous down for a long time. It succeeded a few days ago, filing a lawsuit in New York and getting Scrabulous blocked in North America.

The outcome for Hasbro: It's ticked off thousands of Scrabulous devotees. And Scrabulous is back, under a new name, Wordscraper, with slightly different rules. So far, it looks to me like Hasbro is winning the lawsuits and losing in the marketplace.

Instead of fighting Scrabulous, Hasbro should have licensed it, or otherwise cut a deal, using the online popularity of Scrabulous to boost goodwill, generate sales of the board game, and possible ad revenue. If it couldn't cut a deal with Scrabulous, it should have advertised to its players, get them to buy copies of the Scrabble board game. Would that have generated profit for Hasbro? I don't know for sure, but I think it probably would -- and there's no evidence to suggest that Hasbro's fight-and-litigate strategy will be a moneymaker. "Pissing off a large group of people, even if you have the legal right to do so, can often be a disastrous business move," says Techdirt.

Contrast the dismal record of the copyright-protectors with the success of people who've reached an accommodation with copyright violators. Let's start with Star Trek. Forty years ago, the TV series flopped and went off the air. A small cadre of copyright thieves -- otherwise known as "fans" -- started cranking out underground fiction about the characters and settings. These were flagrant copyright violations -- and yet the studio ignored them. The result: The studio made a fortune off the once-failed TV series. Star Trek sprung back to life for a million movies and TV shows, a Las Vegas casino exhibit, and an upcoming online game. Even while CBS Paramount has been raking in the Star Trek bucks, the thievin' fans have continued cranking out their contraband, turning out millions of words of fan fiction, homemade costumes, props -- even their own Trek TV shows.

By the music industry standards, the folks at Paramount are clearly fools, allowing thieves to run amok in their shop -- and yet Paramount is making tons of money and the music industry is not.

Universal Press Syndicate is apparently learning from history. When a bunch of thievin' fans Photoshopped Garfield cartoons to remove the lasagna-loving cat, UPS didn't sic the lawyers on them. Quite the contrary -- they offered the thieves a book deal. Garfield Minus Garfield is due out on October. Garfield creator Jim Davis even thanked the fans. If only King Features were equally enlightened -- the extremely raunchy Dysfunctional Family Circus is bust-a-gut funny, but King Features, which owns the rights to the original cartoon, suppressed the series.

This is not about right and wrong. This is about making a profit. Many companies have proven they can be profitable while being lackadaisical in enforcing their copyrights. Can the companies that aggressively defend copyrights say the same thing?

[Benoit]

The fine line to be found concerning intellectual property protection is the one in between a strong protection where creator sits on their laurels and a weak protection that discourage creativity.

[Scape]

All Hasbro has done is burnt their brand just like Metallica did with Napster.

[Benoit]

Scape wrote:

All Hasbro has done is burnt their brand just like Metallica did with Napster.

But we are still eagerly waiting to see the new international Monopoly board: will it be Montreal or Istanbul?

[Blue_Nose]

Benoit wrote:

The fine line to be found concerning intellectual property protection is the one in between a strong protection where creator sits on their laurels and a weak protection that discourage creativity.

I disagree - its the big media companies that are pushing strict enforcement of copyright protection, and they are anything but creative. If outlets such as Youtube are any indication, which have opened up opportunities for anyone to create content and share it for free, it's liberal sharing of ideas and information that encourages creativity.

[Benoit]

Blue_Nose wrote:

Benoit wrote:

The fine line to be found concerning intellectual property protection is the one in between a strong protection where creator sits on their laurels and a weak protection that discourage creativity.

I disagree - its the big media companies that are pushing strict enforcement of copyright protection, and they are anything but creative. If outlets such as Youtube are any indication, which have opened up opportunities for anyone to create content and share it for free, it's liberal sharing of ideas and information that encourages creativity.

Copyright protection is only a particular case of patent protection.

[hurley_108]

Garfield minus Garfield is one of the awesomest things on the tubes, and the only sad part about Davis' support of it is that it's such an anomaly.

[Benoit]

Quote:

Contrast the dismal record of the copyright-protectors with the success of people who've reached an accommodation with copyright violators.


Many companies have proven they can be profitable while being lackadaisical in enforcing their copyrights. Can the companies that aggressively defend copyrights say the same thing?

Reaching an profitable accommodation was possible because, looming, was a credible threat of legal action. In other words, the accommodators were free riding on copyright-protectors.

[Blue_Nose]

Benoit wrote:

Reaching an profitable accommodation was possible because, looming, was a credible threat of legal action.

You're missing the point - reaching an agreement with copyright infringers is an advantage to the copyright owners. Legal action has shown to have a negative impact on the owner while, at least in the case of this online scrabble game, they continue with their activities.

If copyright owners aren't willing to work with people who take advantage of their 'property', they're best off doing nothing about it at all.

[hurley_108]

Blue_Nose wrote:

Benoit wrote:

Reaching an profitable accommodation was possible because, looming, was a credible threat of legal action.

You're missing the point - reaching an agreement with copyright infringers is an advantage to the copyright owners. Legal action has shown to have a negative impact on the owner while, at least in the case of this online scrabble game, they continue with their activities.

If copyright owners aren't willing to work with people who take advantage of their 'property', they're best off doing nothing about it at all.

What's 1337er than 1337? 13337! Here's to your 13337 post!

[Mr_Canada]

Very good article!

[Benoit]

Blue_Nose wrote:

Benoit wrote:

Reaching an profitable accommodation was possible because, looming, was a credible threat of legal action.

You're missing the point - reaching an agreement with copyright infringers is an advantage to the copyright owners. Legal action has shown to have a negative impact on the owner while, at least in the case of this online scrabble game, they continue with their activities.

If copyright owners aren't willing to work with people who take advantage of their 'property', they're best off doing nothing about it at all.

To reach an agreement, one needs negotiation power. Negotiation power comes from expansive past lawsuits.

[Blue_Nose]

Benoit wrote:

To reach an agreement, one needs negotiation power. Negotiation power comes from expansive past lawsuits.

Negotiating power comes from the ability for the typically large media owners to promote the work of typically independent copyright infringers. In the case of the Garfield cartoons, the independent would not likely have the resources to publish a book, which is where the publishers of the Garfield cartoon stepped in.

Threating a lawsuit isn't an agreement - it's bullying, and would have precisely the opposite effect on creativity that you claim to wish to promote.

[bootlegga]

Excellent article!

[Benoit]

Blue_Nose wrote:

Benoit wrote:

To reach an agreement, one needs negotiation power. Negotiation power comes from expansive past lawsuits.

Negotiating power comes from the ability for the typically large media owners to promote the work of typically independent copyright infringers. In the case of the Garfield cartoons, the independent would not likely have the resources to publish a book, which is where the publishers of the Garfield cartoon stepped in.

Threating a lawsuit isn't an agreement - it's bullying, and would have precisely the opposite effect on creativity that you claim to wish to promote.

Negotiating power comes from the capacity to choose in between alternative creators (suppliers).