aTypical Joe: a gay New Yorker living in the rural South

Friday, September 21, 2007

Weak IP laws make the fashion industry thrive!

A dear friend who has been treated quite nicely by the publishing industry and is a beneficiary of the current copyright regime - one might even call him a copyright hawk - sent me this from The New Yorker hinting that even he can see that there are times where the extension of copyright works against the interests of an industry.

James Surowiecki, in The Piracy Paradox, finds that cheap (legal) knock-offs help keep the fashion industry healthy and profitable:

Congress now finds itself considering a bill, pushed by the Council of Fashion Designers of America, that would give original designs a legal protection similar to copyright.

Designers’ frustration at seeing their ideas mimicked is understandable. But this is a classic case where the cure may be worse than the disease. There’s little evidence that knockoffs are damaging the business. Fashion sales have remained more than healthy-estimates value the global luxury-fashion sector at a hundred and thirty billion dollars- and the high-end firms that so often see their designs copied have become stronger. More striking, a recent paper by the law professors Kal Raustiala and Christopher Sprigman suggests that weak intellectual-property rules, far from hurting the fashion industry, have instead been integral to its success. The professors call this effect “the piracy paradox.”

The paradox stems from the basic dilemma that underpins the economics of fashion: for the industry to keep growing, customers must like this year’s designs, but they must also become dissatisfied with them, so that they’ll buy next year’s. Many other consumer businesses face a similar problem, but fashion-unlike, say, the technology industry-can’t rely on improvements in power and performance to make old products obsolete. Raustiala and Sprigman argue persuasively that, in fashion, it’s copying that serves this function, bringing about what they call “induced obsolescence.” Copying enables designs and styles to move quickly from early adopters to the masses. And since no one cool wants to keep wearing something after everybody else is wearing it, the copying of designs helps fuel the incessant demand for something new.