New Media Bring New Problems to Copyright Arena

When Therese Iknoian learned that the sports and fitness column she wrote for the San Jose Mercury News was being reproduced on the paper’s World Wide Web site, she was more angered than flattered.

As a freelance contributor, she assumed she had granted the Mercury News only “first serial rights,” the standard for print publication. But the Mercury News, following the policy of its parent company, Knight-Ridder, wanted her to sign a contract turning over the right to use her work in all electronic media.

For months, Iknoian negotiated without success. “In March of this year,” she recounts, “they told me to sign it or get lost, so I quit writing for the paper.”

Tales like Iknoian’s are becoming common as individual creators of words, sound and images--content providers, in online parlance--lock horns with the corporations that assemble their output into CD-ROMs, Web pages, online services and other electronic media.

At issue ultimately is the status of intellectual property in the electronic marketplace. More immediately, disagreement over compensation for electronic use of material originally created for print is turning into a publishing civil war.

“These are complicated issues,” says David Yarnold, the editor involved in the negotiations with Iknoian and now editorial director for new media at Knight-Ridder. “And everyone ought to be thinking about fairness for everyone involved.”

That’s not so easy. Newspapers and magazines usually own the copyright for the material their employees create on the job. But many freelancers, who get few of the benefits of employees, have traditionally sold only one-time print rights and retained full ownership of their work for subsequent sales.

Now a growing number of publishers, scrambling to be a part of the new-media world, are insisting that creators explicitly turn over control of electronic rights without additional compensation. Others are asking freelancers to sign work-for-hire agreements, thereby relinquishing copyright and all other rights--including the right to revise their work--to the publisher. These latter rights, known in legalese as “moral rights,” are particularly vulnerable since malleability is a defining characteristic of digital media.

This newspaper, for instance, has issued contracts in which freelancers grant the paper nonexclusive rights to use the material “in any format or media whether now known or later devised.”

The publishing rights conflict involves some of the biggest names in the business, from the glossy magazines of the Hearst empire (Redbook, Good Housekeeping, etc.) to educational publishing giant Scholastic Inc. to wire service Associated Press, which recently began requiring freelance photographers to sign contracts granting all rights to their work.

Publishers say their motives for developing the new contracts are practical as much as financial. Bob Simon, legal counsel for KRI/Knight-Ridder, says: “Publishers want the ability to disseminate by any means available. It’s not practical for authors to retain rights to approve or disapprove, so the ultimate solution will give all rights to the publisher and cover even technologies not yet invented.”

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The biggest e-rights battle began last summer, when the New York Times instituted a policy of assuming the rights to freelance work in all formats for all time without additional payment. Alarmed that the Times contract would set a nationwide precedent, the Authors Guild, the National Writers Union and the American Society of Journalists and Authors formed an unusual alliance to protest the policy through old media and new.

This May, when the Boston Globe, a New York Times subsidiary, sent similar work-for-hire contracts to its freelancers, Robert Jordan, a Globe columnist and president of the Boston Globe Employees Assn., sent a letter to the paper’s managing editor protesting the policy--apparently the first time an employee group at a newspaper has backed freelancers on the issue. Jordan warned that where electronic rights are concerned, “we would also voice strong objections to any similar language that would surrender to the Globe the complete ownership of all [bargaining] unit employee writings . . . .”

The controversy is expected to come to a head late this fall when a federal judge in New York rules in Tasini vs. New York Times on whether freelance writers retain their copyright on works reused for electronic databases.

In December 1993, 11 freelancers, led by National Writers Union President Jonathan Tasini, sued the publishers of the New York Times; Newsday (owned by Times Mirror Co., parent company of the Los Angeles Times); Sports Illustrated (Time Inc.); and the Atlantic, along with Nexis and UMI, for the unauthorized sale of their articles in online databases and CD-ROM compilations.

“The suit has the potential to totally reshape the area of writers’ rights,” says Tasini. “If we win, we’ll have the opportunity for unprecedented leverage with the industry.”

But Bruce Keller, lead attorney for the defendants, insists that the issue is much narrower, turning on a single provision of the copyright act.

Using the New York Times as his example, he says: “The question is, does the publisher have the right to take today’s issue of the New York Times and put it in a database so it can be retrieved electronically? Our position is that there is no difference between the print edition of the New York Times and the electronic edition of the New York Times. We’re not talking about the right of freelancers to control their work in a whole host of other media.”

Behind all the bad blood is a mix of confusion, panic and hype as the electronic market explodes. Newspapers and magazines are racing to open sites on the World Wide Web; many appear on commercial services, such as CompuServe and America Online; and a growing number are joining forces with online archival services, such as Nexis and Magazine Database, that provide the text of old articles to professional researchers at a hefty price.

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Meanwhile, periodical publishers, looking to cut costs, are turning more to freelancers, as freelancers, also eager to benefit from technological advances, are counting on secondary electronic sales to augment their incomes.

To a great extent, fortunes made from the Web are still more potential than real. Time’s popular Pathfinder site, for instance, brought in just $2 million in advertising in 1995; industry estimates put its start-up cost at about $3 million. “There’s no pot of gold here yet,” says Paul Sagan, president and editor of new media at Time.

Other parts of the digital universe are already generating large revenue streams, however. Karen Burka of Simba Information, a market research firm in Connecticut, estimates that the market for online services in 1995 was about $15.7 billion. Though she doesn’t break that into categories, writers’ advocates say the sale of full-text articles from newspapers and magazines is already a multibillion-dollar business.

“Freelancers’ work is being distributed via online databases that can cost $90 an hour to access and via CD-ROMs that sell for thousands of dollars a copy,” says writers union Vice President Philip Mattera. “Print publishers may have entered into lousy deals with the electronic services, but that’s no reason to deprive writers of their fair share of what appears to be a substantial amount of money.”

John R. (Rick) MacArthur, publisher of Harper’s and a writer himself, sees something in both perspectives. In February, Harper’s became the first major publication to announce that it would share royalties--past, present and future--from electronic uses with its freelancers, even though MacArthur thinks the issue is somewhat tangential.

“It’s chump change all around,” he says. “I can’t understand why the publishers are trying so zealously to screw the writers.”

Most publishers are waiting to see how the Tasini case is resolved, but some are moving ahead with writer-friendly policies on electronic rights. Publishers Weekly and the Nation have followed Harper’s lead on sharing royalties with freelancers, and other magazines, such as Woman’s Day and Sierra, routinely pay a separate fee for electronic republishing. K-III, owner of New York and other titles, recently sent checks to freelancers for past electronic uses, and the Washington Post has reimbursed individual freelancers who complained about unauthorized use.

Realizing that there is no one-size-fits-all solution, writers organizations hope to build an infrastructure to make payment for electronic use of freelance work feasible.

Last year, the Authors Guild and ASJA spearheaded the Authors Registry, an entity now involving dozens of writers organizations and literary agencies, through which publishers, including Harper’s and the Nation, will make rights payments to freelancers.

The Publication Rights Clearinghouse, a project of the National Writers Union, is working with Uncover, a hybrid online-fax document delivery service owned by CARL Corp., a subsidiary of Knight-Ridder. Through the Clearinghouse, copyright fees collected from Uncover’s customers will go directly to freelancers rather than to publishers, as in the past.

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The granddaddy of royalty distribution systems is the American Society of Composers, Authors and Publishers, founded in 1914. But ASCAP-like schemes that monitor use as a basis for payment can be cumbersome online, so the National Writers Union is advocating a system in which print publishers pay freelancers an additional flat fee for a finite period for each electronic usage.

David Goodman, a Vermont writer, helped negotiate such an arrangement in which all freelancers writing for SkiNet, a new online service owned by Times Mirror, receive a 10% fee for electronic reuse of their work for one year.

Says Goodman, who is optimistic about the arrangement: “Publishers who deal with their writers in good faith will come up with lots of models.”