Will expiring copyrights be the next gold mine for NFTs?
While non-fungible tokens (NFTs) are most often found in the form of digital art, they also exist in many other forms, representing more than just art.
In the creative industry, NFTs are already being used by some musicians, such as the band Kings of Leon, to release their latest album. In the sports industry, NFT was created to record the wonderful moments of major sports events such as the NBA. In the consumer goods industry, Nike, Gucci, and many others are selling their digitally branded products in the form of NFTs. More applications of NFT in the real world are still to be explored, one of which is the digital publishing industry.
The game-changing implications of using NFTs to publish and promote books have been extensively discussed by many. For example, the Alliance of Independent Authors is helping independent authors use NFTs to promote their latest books. Other fan club-related items such as character cards were also made into NFTs. Tezos Farming, a project built on the Tezos network, even used the full text of George Orwell’s Animal Farm book, divided into 10,000 copies as the NFT title.
NFTs created from existing books are often subject to copyright. However, in the case of Tezos Farmation, the copyright has expired. The text in the book is freely available to any party. This raises a very interesting question: how does NFT protect the copyright and royalties of books whose copyright has expired?
So far, NFT applications in the publishing industry have mainly focused on books that still have royalties and are in their copyright life. But there are also authors whose works live on long after their death and copyright expire; could NFTs provide a means for their estates to extend the life of their books and royalties?
The journey from copyright to the public domain
Copyright law is complex and varies widely around the world. While few countries do not offer copyright protection under international conventions, most jurisdictions work on the premise that copyright is protected during the author's lifetime and for at least 25 years after his death.
In the European Union, copyright lasts for 70 years after the author's death. The same is true in the US, with the only difference that books published between 1927 and 1978 are protected for 95 years after first publication. No matter how long a copyright has been protected, given enough time, anything will eventually fall into the public domain for free.
When a famous work of literature enters the public domain, its future value is reduced to essentially zero. However, there still often exists an unrelated community that inherently values the work.
With copyrighted legacies about to enter the public domain, there is a unique opportunity to leverage the intangible goodwill embedded in disconnected communities to create tangible assets in the form of NFTs.
A good example is Winnie the Pooh, the fictional anthropomorphic teddy bear created by British author A.A. Milne and British illustrator EH Shepard, loved by fans all over the world. The first collection of stories about the character was written in 1926. After 96 years, the copyright expired and the book entered the public domain on January 1, 2022. While the commercial value of the world-famous cartoon character of Winnie the Pooh will remain high for a long time to come, the legacy holding the rights will not gain any future value from Winnie the Pooh.
Extend the value of an expiring copyright
Right now, publishers have no incentive to work with copyright holders who are about to enter the public domain because the work will soon be free. Certificates of authenticity represented by tradable NFTs may provide incentives for such collaborations.
After the copyright expires and the work enters the public domain, NFT will take royalties further into the digital world. Royalties can be generated through NFT marketplace sales on the blockchain, or by creating more complex smart contracts for specific use cases of first editions, limited editions, or signed vintage editions.
Well-loved characters and the worlds they inhabit can become a solid foundation for NFTs, expanding not only copyrights, but also creativity in mediums such as literature, games, metaverses, philanthropy, and education.