TechCrunch Gets It Wrong on Creative Rights

by Glenn Kelman | 23 Comments

Why has TechCrunch, the technology community’s most influential voice, taken its stand against creative rights?

The latest attack has been against Hasbro, for disabling the Facebook game Scrabulous, which is nothing more than Hasbro’s Scrabble game on Facebook. In doing this, Hasbro has become a caricature of evil for fighting in court against freedom, pluck and Scrabble.Mugshot

“Hasbro and EA planned their moves very methodically and waited patiently for their chance to strike,” writes Erick Schonfeld. “Perhaps EA felt that it could not compete with Scrabulous other than by taking it out at the knees.”

Michael Arrington has taken similar positions against digital rights for music, and the blogosphere generally has expressed something like contempt for journalists, artists and others whose work has found a new stage on the Internet but often for the profit of the technology distributor — Google News, YouTube, BitTorrent and, for a while, Napster — rather than the creator.

But how is Scrabulous different than the Facebook lawsuit against StudiVZ, the German Facebook copycat that only last week TechCrunch dismissed as “nothing more than Facebook in red and translated in German?”

Here’s what’s different: in StudiVZ, the party being copied was one of us, a software company rather than an old game company that supposedly doesn’t get it.

I know that, of all people, Redfin folks are supposed to stand for liberating data and disintermediating The Man, but I lose my stomach for it when The Man is someone who has created (or paid the creator of) a game, an essay, a photo, a song. We shake our fists at the record labels but at least they’re paying musicians.

And we shake our heads at newsrooms, but every one has become a wasteland of empty cubes, which is a travesty when more people are reading the news than ever before. Spare me the examples of bands who offer their albums for free, then ask for donations; this is nothing more than online busking, the luxury of a great violinist sawing away at a subway stop.

It isn’t easy being a musician, a game-make or a writer but these are exactly the people who should benefit the most from the Internet, not through netizens’ pseudo-altruism but via the medium that all of TechCrunch’s hyper-capitalists purport to respect: commerce.

That we should get everything for free was once a kind of adolescent anarchism but Chris Anderson and others have made it into something much bigger, the new religion of Silicon Valley. For the folks who don’t have venture capital, free’s just another word for nothing left to lose.

TechCrunch is one of the best blogs out there because it has always stood up for the creative guy over the thief. You guys should do that now, even if it’s for Hasbro.

Photocredit (yes, I’m dimly aware of the irony): Wiseacre on Flickr.

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Discussion

  • Bryce

    I don’t entirely disagree with you, but Hasbro missed a golden opportunity in the Scrabulous affair. They had a gigantic existing fanbase that they squandered by killing Scrabulous instead of acquiring it. And I argue that Hasbro didn’t really have a logical basis for complaint (legality aside) until they had their own app to satisfy the clear market demand in that segment. In my mind, the “right thing to do” would have been to approach the publishers and say: “Great job! We want to make you official – and by the way you need to get the rights from us.”

    And as for DRM – publishers need to get over it. It’s clearly not working. It historically never has. Anyone with half a brain would predict with a great degree of certainty that it never really will. I still buy content that I care about. Others do too. Just produce content that people care about.

  • http://blog.redfin.com/blog/author/glenn%20kelman Glenn Kelman

    Someone tried to copy Redfin’s site, and we would never have paid them to join us:
    http://blog.redfin.com/blog/2008/04/attack_of_the_clones.html

    Since Hasbro has many games, what precedent would it set by paying people to Facebookize each one without paying a licensing fee? How would it explain this rewarding of bad behavior to its other licensees?

  • Bryce

    I agree with you on the website copy. But that’s not what Scrabulous did. They copied a good idea and implemented it in a new growing market segment not addressed by Hasbro. I agree that they should’ve gotten rights for it. But I still think that Hasbro could have achieved a lot better result for themselves – as well as their fans – if they had approached this differently. Ultimately my argument against Hasbro in this case, and in DRM in general, is not about the legality. My argument is the way that rights-holders use the law as blunt sledge-hammers when it doesn’t seem to be helping either them or their users. There always are other solutions.

  • Bryce

    Reading at RWW (http://www.readwriteweb.com/archives/the_bigger_questions_behind_the_scrabulous_shutdown.php) I see that I’ll have to eat my words on this particular case – though my essential argument remains. It sounds like Hasbro did the smart thing and the two brothers drank an idiot potion.

  • http://www.episodic.com Noam Lovinsky

    I completely agree. My only knit pick is that record companies don’t really pay artists (enough).

    • http://www.newhomesteps.com New home building guru

      Good point Noam. I'm completely agree with what you're saying.

  • http://smallprecuations.blogspot.com Nils Gilman

    I agree with your moral outrage against TechCrunch hypocrisy, Glenn (though I’d be more careful about biting the hand that blogs you)

    But I also agree with Bryce that Hasbro handled the Scrabulous case in a ham-fisted manner that was actually counterproductive to their own interests. I actually think that Hasbro would have been setting a GREAT precedent for itself it had paid the Scrabulous kids some coin. Rather than hiring their own software developers to develop some official version of their application, for an as-yet-unproven platform like Facebook, incurring significant risk and cost, they simply let anyone who wants to create an online version of one their games know do so, and then buy out the ones that are successful. Traditional game-makers ought to run competitions that say something to the effect of “Create an online version of our game that gets [X] number of regular users, and we’ll buy you out for Y dollars.” It’s the equivalent of the X Prize, and it’s all upside for the game companies.

    What’s more, whatever extortionate price the Scrabulous kids were demanding is surely less than the cost of the damage that Hasbro is doing to its brand. It’s just pure corporate stupidity.

    So, morally you and Hasbro right. But pragmatically, Hasbro has handled this in a stupid fashion.

  • http://blog.redfin.com/blog/author/glenn%20kelman Glenn Kelman

    Good points Nils. And I’ll be careful: but hopefully everyone knows I love TechCrunch and that the editors love the debate.

    What would have been a fair price for Hasbro to pay?

  • http://smallprecuations.blogspot.com Nils Gilman

    I don’t know what the fair price would have been, but presumably something like a few pennies a user would have been reasonable. I don’t exactly know how you monetize those users, which is what you’d want to know before you price what they’re worth. Tthen again, Hasbro must think they are monetizable, because if they weren’t, then why would Hasbro begrudge the Scrabulous programmers, or the Scrabulous users? (And it’s not as if Scrabulous users are less likely to buy or play the over-the-board version of the game–quite the opposite, in fact–so there’s no issue of cannibalization that I can think of.)

  • Anon

    Hasbro was remarkably restrained in its handling of the Scrabulous matter.

    Scrabble is a trademark of the Hasbro company. Trademarks indicate the origin of a good or service. Trademarks can be lost by allowing a third party (in this case, the sleazy brothers who put “Scrabulous” on Facebook), to use your trademark in an unauthorized manner.

    In short, if Hasbro wants to keep its Scrabble trademark untarnished, Hasbro had no choice about whether to stop Scrabulous. What’s remarkable is that Hasbro didn’t go straight to court to resolve this, given the grave consequences it risked by negotiating for 6 months with two weasels who were clearly cashing in on Hasbro’s trademark rights.

  • http://blog.redfin.com/blog/author/glenn%20kelman Glenn Kelman

    Hey Nils, it just seems like you should have a number in mind if you’re advising Hasbro to pay it?

    As Bryce just pointed out — I hadn’t noticed this before — Hasbro apparently offered $10M. Most financial analysts valued Scrabulous at $3M – $6M.

  • http://smallprecuations.blogspot.com Nils Gilman

    Well, the Agarwalla brothers may well be getting bad or unrealistic legal/financial advice. Not taking $10m (if in fact that was the amount offered) is unpardonably, idiotically greedy.

    At the same time, let’s recognize the legal injunction by Hasbro for what it is: it’s not some noble moral stand against IP theft, but rather more prosaically a negotiating tactic designed to lower the price that Hasbro will eventually pay to the brothers. (In other words, it’s a smaller scale version of the $1B dollar nuke that Viacom dropped on Google over Yahoo — merely a hardball tactic in a larger negotiating strategy, which ultimately entailed We’re-Not-Evil Google handing over YouTube user information to We’re-Not-Stupid Viacom.)

    I still think that whatever the sleaziness of the Agarwalla brothers, Hasbro is doing itself a tremendous amount of damage by not reaching an amicable settlement. They actually have more to lose than the Agarwallas — which, of course, the Agarwallas know full well. The Agarwallas know they are winning in the court of public opinion, and that time is on their side.

    In the end, the two sides will probably settle somewhere in the middle, having succeeded only in pissing off their users and thus devaluing the asset they are fighting about.

  • http://www.startuptoons.com David Mullings

    Excellent post.

    Most bloggers conveniently do not mention that Hasbro DID try to buy Scrabulous as one of the comments points out. These brothers tried to be greedy when they were legally in the wrong.

    A new generation is growing up thinking that trademarks and copyrights do not need to be respected and it is wreaking havoc for rights owners.

    Hasbro played nice and the brothers behaved like idiots so Hasbro brought out the sledge hammer and the brothers turned off North American access.

    Hasbro just needs to show how much money the brothers were making, that they made an offer and the cheats tried to stiff them. I understand the brothers were pulling in over US$25k a month!

    As for Hasbro licensing the name to make Scrabulous official, they don’t own the International rights to Scrabble or to create games online.

    Finally, the Scrabulous users who complain are nothing more than “fans” and not even true ones at that. Whatever happened to respecting laws?

  • Anon

    @David

    “As for Hasbro licensing the name to make Scrabulous official, they don’t own the International rights to Scrabble…”

    I suspect that you don’t actually understand what a trademark is, or you wouldn’t have written that.

    In any event, the U.S. Patent & Trademark office thinks differently, see below which is copied from the USPTO trademark database (in fact, Hasbro owns several registered trademarks on Scrabble, including for electronic/online versions of the game):

    Typed Drawing

    ——————————————————————————–
    Word Mark SCRABBLE
    Goods and Services IC 028. US 022. G & S: APPARATUS FOR PLAYING AN ELECTRONIC WORD GAME. FIRST USE: 19781130. FIRST USE IN COMMERCE: 19781130
    Mark Drawing Code (1) TYPED DRAWING
    Serial Number 73199812
    Filing Date January 12, 1979
    Current Filing Basis 1A
    Original Filing Basis 1A
    Registration Number 1136336
    Registration Date May 27, 1980
    Owner (REGISTRANT) SELCHOW & RIGHTER COMPANY CORPORATION NEW YORK 2215 UNION BLVD. BAY SHORE NEW YORK 11706
    (LAST LISTED OWNER) HASBRO, INC. CORPORATION BY ASSIGNMENT, BY MERGER RHODE ISLAND 1027 NEWPORT AVENUE PAWTUCKET RHODE ISLAND 02862

    Assignment Recorded ASSIGNMENT RECORDED
    Attorney of Record PAUL N. VANASSE
    Prior Registrations 0524505
    Type of Mark TRADEMARK
    Register PRINCIPAL
    Affidavit Text SECT 15. SECT 8 (6-YR). SECTION 8(10-YR) 20001208.
    Renewal 1ST RENEWAL 20001208
    Live/Dead Indicator LIVE

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  • http://www.shineharder.com Miguel

    eh, who cares if they try to copy you. You have the prescence and the codebase. If they can’t get to that then, they will always be following.

    eh

  • Anthony Alexander

    I hate copying. Generic ideas such as playing with words is another thing. Hasbro should be happy no one ever contested the validity of such a basic concept beforehand. Shame on those guys for calling it scrabulous anyways. The point of copyrights has been totally perverted, but then again, that’s human, that’s what makes us so interesting to watch from space

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