As a proud product of the Napster era and the open source community, I strongly believe that intellectual property law in the United States and elsewhere has gone too far. Copyright terms should be far shorter. Fair use should be more broadly interpreted. Patent trolling should be eliminated. Major reforms are desperately needed, and they are not forthcoming.

That doesn’t mean I favor eliminating intellectual property. As long as we suffer under capitalism, we must have some mechanism by which art may be pursued professionally. Patronage exists, and has its place, but history tells us that can not be the only model.

One thing that makes a lot of sense in our current system is licensing. There are various avenues by which to transform, distribute, and sell art. An artist can only take on so much of that work before they no longer have time to pursue their craft. Licensing allows them to outsource that work to others. The wealth is then shared under openly negotiated terms.

Licensing is what allows our favorite artists to have so much merchandise to sell. It’s what allows our favorite stories to be adapted into every medium. It’s what allows our favorite characters to appear everywhere in our society. It’s hard to imagine a world where Pokémon only appear in video games.

The Problem

The problem I see is that our law permits licensing deals to contain exclusivity clauses. Artists negotiate for more money in exchange for promising not to license the same property to any competitors. Most often these exclusivity deals are regional, but they can be global.

Increased compensation is not the only thing that makes these deals attractive to rights holders. As the number of licensees increases, so does the work required of the licensor. Each new contract comes with a new set of legal fees. Creators often maintain creative oversight of products produced under license. If there are several deals in place, then these approvals can become burdensome.

I don’t have any data to back this up, but it seems that non-exclusive deals are now the rarity. Even for very small products like board games, publishers all have exclusive regional rights for their games. If any reader has data to confirm or invalidate my feelings, please contact me.

Intellectual property law grants artists exclusive rights to their own work, but they often lack the power to exploit that to a high degree. Third parties with vast resources are better equipped for exploitation. When they acquire exclusive rights we begin to see societal harms.

The most prominent examples in my mind are related to sports. Leagues give exclusive merchandising rights to a single manufacturer. This company finds itself in a position to sell a low quality product at inflated prices. Leagues sell exclusive broadcasting rights for each game to various networks. Fans suffer needing several subscriptions to follow their favorite team. Leagues sell exclusive rights so that only one video game will include their teams and players. That lucky game publisher can sustain itself with only minor annual updates and minimal innovation.

An Answer

As the title suggests, my solution is an outright ban on exclusive licensing deals. The principle is that in order to promote the progress of science and useful arts, the government should only guarantee a temporary monopoly for creators themselves. If they are to share that right with others, they must do so on a non-exclusive basis.

Most of the benefits of this are quite obvious. Licensors will fiercely compete on price and quality, to the delight of customers. People with very creative ideas will less often be denied the opportunity to bring them to market. It may even reduce income inequality as profits previously concentrated in one company are spread across several.

What excites me most are some non-obvious consequences, especially in areas that have always been exclusive. I imagine a world where every major video platform pays fees to air major events like the Super Bowl. Fans can choose the network with their favorite broadcasting crew. It will be fascinating to see who wins that ratings war.

As for implementation, I suggest a mandate that once any licensing deal is signed, those same terms must be offered to any and all parties.

For example, I agree to let JoeyJoeJoe sell t-shirts with the Apreche logo on them at the cost of five dollars per shirt. MarySue sees that Apreche is very popular, and believes they can compete with JoeyJoeJoe. If they agree to the exact same contract that JoeyJoeJoe signed, paying me five dollars per shirt. I have no right to refuse. The only way I can prevent competition is to go into the shirt business myself.

There is some existing precedent for this. In the music industry we have compulsory licensing. This is how cover bands exist. Permission is not required to perform someone else’s song as long as credit is given and royalties are paid. My proposal is less extreme, as it still relies on private negotiation.

Over time I think companies would adapt to using some combination of auctions and group negotiations. Auctions would allow rights holders to set the bar as high as possible, but fewer licensees would sign on the dotted line. Group negotiations would shift power to the other side, but prices would still have to stay high enough to scare away any defectors.

Though I am a fan of rapid and radical change, I admit this can’t be done overnight. It is inherently unfair and destabilizing to nullify so many existing contracts. Even so, if the industries do not have sufficient time to prepare, the policy would not have the desired result. At the very least we must allow all pre-existing deals to run their course.

This is all moot anyway. There is absolutely no chance of this happening in my lifetime. I just can’t help but notice how many people are bemoaning consequences which stem from these monopolies without ever identifying exclusive deals themselves as a root cause.