Raustiala and Sprigman (2019)
|Raustiala and Sprigman (2019)|
|Title:||The Second Digital Disruption: Streaming and the Dawn of Data Driven Creativity|
|Author(s):||Raustiala, K., Sprigman, C. J.|
|Citation:||Raustiala, K., & Sprigman, C. J. (2019). The Second Digital Disruption: Streaming and the Dawn of Data-Driven Creativity. NYUL Rev., 94, 1555.|
|Link(s):||Definitive , Open Access|
|Key Related Studies:|
|About the Data|
|Data Description:||Primary data comprises 3 interviews with decision-makers at adult entertainment streaming conglomerate MindGeek|
|Data Type:||Primary and Secondary data|
|Secondary Data Sources:|
|Data Collection Methods:|
|Data Analysis Methods:|
|Cross Country Study?:||No|
|Government or policy study?:||No|
|Time Period(s) of Collection:||
This Article explores these phenomena across a range of firms and content industries. In particular, we take a close look at the firm that is perhaps farthest along in its use of data-driven creativity. We show how MindGeek, the little-known parent company of Pornhub and a leader in the market for adult entertainment, has leveraged streaming data not only to organize and suggest content to consumers but even to shape creative decisions. MindGeek is itself the product of the same forces the shift to digital distribution and the accompanying explosion of free content that transformed mainstream creative industries and paved the way for the rise of streaming. We first show how the adult industry adapted to the first digital disruption; that story aligns with similar accounts of how creative industries adapt to a loss of control over intellectual property. We then show how MindGeek and other streaming firms such as Netflix, Spotify, and Amazon are leveraging the second digital disruption, using data to make decisions about content promotion, aggregation, dissemination, and investment. Finally, we consider what these trends suggest for competition and innovation in markets for creative work. By making creative production far less risky, data-driven creativity may drive down the need for strong IP rights and reshape conventional assumptions about the purpose and role of IP. At the same time, the rise of data-driven creativity may reinforce the tendency of online markets toward dominance by a few major firms, with significant implications for competition and innovation.
Main Results of the Study
The main propositions of the study are:
- The first digital disruption, most intensely focused on music, engendered significant consumer piracy and in turn significant efforts to deploy copyright law in an ultimately quixotic effort to protect entrenched but aging business models.
- The second digital disruption is deeper. The advent of streaming has transformed how creative content such as music and film is distributed and, increasingly, how it is made. Streaming enables a form of communication between consumer and creator that has profound effects on not only the ecology of innovation but also on the foundational assumptions of intellectual property law.*The risk that a creative work will not find an audience is reduced, perhaps markedly, when audience tastes can be discerned and monitored over time and content finely calibrated to push the right buttons.
- The risk that a creative work that does reach an audience will, absent well-enforced intellectual property rights, be copied by others is also reduced when many consumers can access all the content they desire via their streaming subscriptions.
- As content becomes more predictable in its market success, and piracy less likely, the need for broad and durable intellectual property rights is reduced.
Policy Implications as Stated By Author
As content becomes more predictable in its market success, and piracy less likely, the need for broad and durable intellectual property rights is reduced. Copyright law still has an important role. But since the expected return on investment in creative works is more secure in this new world, the need for government intervention to prop up creator investment (or, more precisely, expectations about investment) via legal rights is lower. In short, the impact on intellectual property law from the second digital disruption is quite distinct from the first. Rather than increase the need for intellectual property protection, as many content firms argued was necessary in the first disruption, the second digital disruption has reduced it.
Coverage of Study
|Level of aggregation:||Individual|
|Period of material under study:||2019|