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Copyright Term Extension: A $21m windfall for Publishers?

By March 16, 2016No Comments

Under the Trans Pacific Partnership Agreement now before a select committee, New Zealand commits to extending the term of copyright from 50 to 70 years after the death of the author. Based on a 2009 report by Henry Ergas, just released, government estimated the net cost of term extension to New Zealand to be $60m a year in increased royalties to foreign rightsholders–$21m of that for books.

To publishers, that looked like a very big number. It would double the total royalty paid on New Zealand book sales—those long-dead authors must have written some extraordinary bestsellers! PANZ investigated. PANZ’s analysis, online here and now with the Foreign Affairs and Trade Select Committee, argues that the government got it wrong. About 200 times wrong. Even accepting the methodology of the Ergas report, term extension on books will lead to about $80,000 of increased royalties to overseas rights holders. If term extension stimulates just a 0.1% increase in output from NZ publishers (experts suggest much higher), then in fact copyright term extension will be a net economic benefit to this country.

PANZ councillor Sam Elworthy, who looks after the copyright portfolio, comments: ‘Another $21m a year for authors and publishers would have been great, so it’s disappointing that it’s not true. And it’s even more disappointing that the government has been relying on such a deeply flawed analysis of the economics of copyright for years. The $60m cost figure has flown around the world: For people who want everything to be free and don’t care much for authors, publishers, and copyright, it’s another stick to beat us with. That undermines the value of copyright and the creative industries in the public mind. We call on the New Zealand government to engage in much more robust analysis of the economics of the creative industries in the future so that the value of intellectual property as a driver of New Zealand’s economic growth can be correctly quantified.’