Brattle principal Coleman Bazelon and senior consultant Lisa Cameron have prepared a paper that addresses the impact of digitization on business models in copyright-driven industries.

The study was sponsored by the National Research Council (NRC) Committee on the Impact of Copyright Policy on Innovation in the Digital Era, part of The National Academies’ Board on Science, Technology, and Economic Policy (STEP). The committee is evaluating how to expand and improve research on the impacts of copyright policy, particularly on innovation in the digital environment. In the paper, Drs. Bazelon and Cameron explain how digitization, the Internet, and related devices have fundamentally altered the competitive landscape for participants in three copyright-driven industries – music, film, and book publishing. In each of these industries, vertically integrated intermediaries – whether film studios, record companies, or book publishers – played a central role in the traditional supply chain. However, with the advent of digitization and the Internet, the distribution stage in each industry’s supply chain changed dramatically. Digitization, the authors say, has resulted in radical changes that have forced industry participants to reconsider their business models. In particular, new distribution entities have emerged, traditional vertically integrated intermediaries have suffered, and creative producers of copyrighted works have entered a brave new world in which at least some may benefit from closer connections to ultimate customers. The paper also presents research questions that might be pursued to obtain a better understanding of how these different industries will evolve over time. The conclusions from the Brattle study will be discussed during an all-day invitation-only workshop on Wednesday, June 8, in Washington, DC, during which time a panel of experts will help to design an agenda for future research. The paper will be formally released on during a public workshop on “The Economic Impact of Copyright: Building Evidence for Policy,” hosted by STEP on June 9, 2011.

To download “The Impact of Digitization on Business Models in Copyright-Driven Industries: A Review of the Economic Issues,” please click below.

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