EU Court Rules E-Books Are Services, Not Goods

If I'd needed to refer back to it often, I'd buy a hard copy, and have a handful such hard copies of technical books. I rarely crack any of them open, the Internet provides all. The only hard copy I have that I've read in its entirety is Metaprogramming Ruby 2.

I'm starting to think of consuming information as applying an 'insight delta' to your brain. Trying to actually hold facts and stuff is foolish, the Internet does that sort of thing much better than your brain does. So concrete information gets shuffled out after awhile, which is fine for my purposes. The stuff I'm dealing with every day, like how to refactor what kinds of code, that stays with me.

A good can be "nonrivalrous" and still be a good: http://en.wikipedia.org/wiki/Rivalry_(economics)

Lemon mint might be another example. It has a pleasant taste and smell, so you might want it as an herb. It's also very, very aggressive. Once you have a little, you can--and will if not careful--have more than anyone would ever need in a very short amount of time.

Excludability is another interesting property of goods: http://en.wikipedia.org/wiki/Excludability

An incredibly deep water table provides a source of water that could be considered both nonrivalrous and nonexcludable. Your digging a well doesn't prevent anyone else from digging a well and drawing water. If you have the only well making technology, though, access to the water table is "excludable," ie, you can charge people for access to your well.

DRM is usually an attempt to take a nonrivalrous, nonexcludable good and turn it into a nonrivalrous, excludable good.

That's the best case for producers, since it means they can charge everyone for each new copy, but marginal cost is zero. That is, each new copy costs them nothing to make. So after the first few sales, every purchase is 100% profit.

Calling e-books services in this case affects their tax rate, but probably also affects a bundle of consumer rights that are highly specific to the EU and fairly complex.

We tend to thing of goods as tangible things, and services as when we make someone spend some time to produce some change (paint a house, fix our hair).

Nothing is inherently a good or service though, so that's really a bit of oversimplification. Hiring a painter? You're actually paying for the paint as well as the work. Buying from a restaurant? You're paying for waitstaff as well as food. A freelance journalist? Seems like providing a service when tasked to report on a certain story. A magazine at a drugstore? That seems really good-like. All of this blends together in messy ways, and it's easy to get wrapped up too much in the significance of a distinction that's mostly historical convention.

Well, except that it's not mere convention once you realize that legal systems around the world treat this as a very important distinction, and vary in how they treat each category in bizarre and unpredictable ways. VAT is one. Why should taxes on booksellers be high but taxes on bookbinders be low? Trade and immigration is another. Why can people pay for a rake from Tanzania but not a Swiss gardener? Warranties and remedies in contract disputes and commercial law are filled with nutty discrepancies.

Each one of these has some historical reason, I'm not saying we should just treat everything like a good, that probably wouldn't work. But it's important to realize that no one could guess all these rules in advance from first principles.

So if you're sitting down and thinking, "what's the best set of policies for e-books?" The answer you want is probably not as simple as, "We should just treat them like goods" or "We should just treat them like services."

Nor does it make sense to make up a whole body of law from scratch to deal with every funny new case. There's really no easy answer, that's why the law evolves really slowly to deal with new technology.

It's not just EU bureaucrats, sadly. I can't immediately find it, but one of the most depressing things I ever read was some proceedings from a government review of copyright here in the UK prior to the recent legislation that finally added various new statutory exceptions.

It consisted of a bunch of unelected people with power to legislate (members of the House of Lords), many of whom declared an interest as people with ties to Big Media one way or another, cross-examining IIRC a senior civil servant whose department were making formal recommendations about the new rules, who stated bluntly that his primary interest was "UK PLC".

The general tone of the entire hearing was that obviously any changes to copyright law should make sure big business still gets its money one way or another, and the only interesting question was how.

The idea that copyright might simply no longer be a reasonable model for the digital age and some other economic model might be more effective didn't seem to occur to anyone.

The idea that copyright might inherently cause harm in terms of the public being able to enjoy works they had already paid for, and that any such harm should therefore be outweighed by some greater benefit for the existence of copyright in law to be ethical and justified at all, was mentioned briefly by I think one or two speakers right at the end of the discussion. They received the parliamentary version of a five-year-old being patted on the head and told how adorable they are. And this was in a debate specifically about new rules to allow people who had obtained lawful copies of a work to enjoy them in perfectly reasonable ways -- indeed, ways millions of UK citizens enjoy every day already, often blissfully unaware that they are even breaking the law, because the idea that what they are doing might not be completely reasonable and could possibly be against the law doesn't even occur to them.

I have seen plenty of evidence of governments pandering to special interests. I have seen plenty of evidence of governments being completely disconnected from reality. I have seen plenty of evidence of government "debates" that were nothing of the kind. Few of these made me as nauseous as seeing that particular example of "democracy in action".