A bit of Wikipedia research reveals that over the last two decades, a number of companies have bought patents, "often from a bankrupt firm", with the goal of suing "another company by claiming that one of its products infringes on the purchased patent." In some cases, a significant share of the revenue for these so-called "patent trolls" comes from the aggressive enforcement of patents that they otherwise do not intend to use.
Although I've written on rare occasion about patents, they aren't really central to the things I think about. On the other hand, piracy is.
Recently, Jeff John Roberts of paidContent compared anti-piracy efforts of services like Getty Images to a start-up, Dreamstime. According to Roberts, Getty tends to bill first and ask questions later, dunning even casual infringers for use fees ($900) that seem astoundingly high for a web image.
Getty also appears to start with the bill, noting "The DMCA [copyright] takedown process is not an adequate remedy by itself because it does not ensure that our photographers receive compensation for use of their images.”
By comparison, Dreamstime offers a choice: discontinue infringing use of an image, or sign up for a licensing arrangement that could cost as little as US $8. The company's CEO told Roberts:
"We want to respond to copyrighted images but we want to do it in a different, non-heavy-handed way. This is very successful way of turning unauthorized users into customers. Once they learn of the license, they often obtain larger licenses.”
The comments that followed Roberts' post are somewhat divided, but I think the critical ones miss a core part of his argument. It makes more sense to turn casual infringers into persistent users than it does to extract a one-time penalty from people who will remember only the pain, not the purpose.
In that light, Getty starts to look a lot like an "image troll". It isn't in the business of selling visual solutions. It's exacting an extortionate rent from people who made a casual, small-scale mistake.
There's a company whose business model parallels what Getty is doing now. At the start of the decade, a quarter of the revenue earned by video distributor Blockbuster came from late fees charged to customers who made a mistake. Along came streaming. A bit more research tells you what happened next.
