!"#!

$"#%&'(
!"#$%&'(#)*+&
,-.+*/'01%$#&&1*)2
3%425%6'!+%.*7'8-9#+4#+%5*.
!"#!$"#%&)*"
3#$4:5*+';'3#$$:-29%52#-&
8-.:&5+<',&&#92%52#-
=,8('>0?'8@'!A?'>B0B'?3C@CDE
#+,-,./+&0,-12/341/,-&,5
6-74812/98&"9:;/-<&,-&)=/2&>89 2
0
1
1
Frepared or lhe Compuler & Commuhcalohs lhduslry Assocaloh (CClA) by
Thomas Rocers ahd Ahdrew 8zamosszec, ecohomc cohsulahls wlh Capla Trade,
lhcorporaled. Capla Trade s a Washhcloh, D.C.based ecohomc cohsulhc rm
lhal specazes h hlerhaloha lrade, ecohomc sludes, ahd slalslca ahayss o
arcescae dalabases. Forlohs o lhe reporl updaled hereh were prepared wlh lhe
assslahce o Froessor Feler Jasz o Amercah Uhversly Washhcloh Coece o Law.
2011 Compuler & Commuhcalohs lhduslry Assocaloh
Jusl Rchls 8lalemehl
We recochze lhal copyrchl aw cuarahlees lhal you, as a member o lhe pubc, have
cerlah eca rchls. You may copy, dslrbule, prepare dervalve works, reproduce,
hlroduce hlo ah eeclrohc relreva syslem, perorm, ahd lrahsml porlohs o lhs
pubcaloh provded lhal such use cohsllules ar use uhder copyrchl aw, or s
olherwse permlled by appcabe aw.
Fermssoh lo use lhs work h a mahher lhal exceeds ar use or olher uses permlled
by aw may be oblahed or cehsed rom lhe Compuler & Commuhcalohs lhduslry
Assocaloh, 900 8evehleehlh 8lreel NW, 8ule 1100, Washhcloh DC, 20006.
No copyrchl s camed as lo ahy parl o ahy orcha work o lhe Uhled 8lales
Coverhmehl or ls empoyees.
Cle as: Thomas Rocers & Ahdrew 8zamosszec, Far Use h lhe U.8.
Ecohomy: Ecohomc Cohlrbuloh o lhduslres Reyhc oh Far Use (CClA:
2011) avaabe ohhe al ccahel.orc.
l8BN 9780979944321
Frhled h lhe Uhled 8lales o Amerca

1
Preface
Executive Summary
Economic Contribution of Fair Use and
Information Technology Dependent
Industries to the U.S. Economy
References
Glossary
TABLE OF CONTENTS
02
04
09
29
31
2
Correcly baahchc lhe eca hcehlves crealed by copyrchl wlh
lhe recualory burdeh lhal lhe copyrchl syslem mposes oh olher
mporlahl rchls, such as ree speech ahd a compellve markelpace,
s a cohlhuhc chaehce or pocymakers. ll has become hcreas
hcy cear lhal lhs baahchc s essehla, shce a arce porloh o U.8.
hduslra aclvly depehds oh ar use ahd olher mlalohs upoh lhe
recualory reach o copyrchl aws. lh 2007, CClA ssued lhe rsl ever
sludy allemplhc lo vaue ecohomc aclvly lhal behels rom copyrchl
ar use ahd olher mlalohs oh lhe copyrchl recualory recme.
Ths updale o lhal research ulzes lhe mosl currehl avaabe dala lo
assess lhe cohlhuhc ecohomc vaue o lhese hduslres. As lhe dala
reecls, lhese 'ar use hduslres' make ah exlraordhary cohlrbuloh
lo our ecohomy.
lh dcul ecohomc lmes, we heed lo preserve Amerca's ehches
o hhovaloh. lhcreased recualoh lhrouch slrcler, more hlrusve
copyrchl aws may cohcevaby promole cerlah lypes o crealve
aclvly, bul l w aso key deler schcahl lechhoocy hhovaloh, al
a lme wheh lechhoocy hhovalors are eadhc lhe eorl lo add hew,
hchpayhc obs lo our slrucchc ecohomy.
Preface
3
As l have sad beore, we musl recochze lhal whal copyrchl eaves uh
recualed lhe Far Use Ecohomy s al easl as ecohomcay sch
cahl as whal l recuales. Ths updale quahles ahd eaborales oh lhal
realy by empoyhc lhe melhodoocca cudehes o lhe Word lhle
eclua Froperly Orcahzaloh (WlFO) or assesshc ecohomc aclvles
realed lo copyrchl. Ths reporl shoud be hslrumehla lo resovhc
currehl copyrchl pocy queslohs, by demohslralhc how mporlahl
baahced copyrchl aw s lo our haloha ecohomy, our exporls, our
lechhoocca eadershp, ahd ob crealoh.
ED BLACK
Fresident c CLC
Compuler & Commuhcalohs lhduslry Assocaloh
"we mst recc~nize that what ccpyri~ht leaves
nre~lated the |air Use Lccncmy is at least
as eccncmically si~nificant as what it re~lates.
4
Executive Summary
|n 2007, CC|A released a repcrt prepared by Capital Trade,
|nc. that was the first ccmprehensive stdy qantifyin~ the
U.8. eccncmic ccntribticn cf indstries relyin~ cn |air Use.
The repcrt shcwed that fair se indstries ~rew rapidly frcm
2002 tc 2006 and played a lar~e rcle in cverall naticnal
eccncmic welfare, ~eneratin~ an estimated $4.4 trillicn in
revene, acccntin~ fcr cne-sixth cf tctal U.8. ~rcss dcmestic
prcdct, and emplcyin~ mcre than 17 millicn wcrkers.
|n 2010, the first pdate hi~hli~hted the ccntined
si~nificant ~rcwth cf the fair se eccncmy in 2007. Tctal
revene, expcrts, and emplcyment all increased sbstantially
cver the 2006 level.
This seccnd pdate incldes data fcr twc additicnal years,
2008 and 2009. This pericd ccvers the recent recessicn
and the data reflect the depth cf the dcwntrn. Lccncmic
activity be~an fallin~ sharply in the seccnd half cf 2008 and
CDF fcr 2009 declined by 2.6 percent. The fair se eccncmy
enccmpasses many cf America's leadin~ indstries and
ccmpanies, bt even these sectcrs were nct immne frcm the
cverall dcwntrn. Nctwithstandin~ this recessicnary envircn-
ment, the fair se eccncmy remained steady when measred
by vale added, while the remainder cf the U.8. eccncmy ccn-
tracted. The data ccntine tc illstrate the ccmpellin~ size
and breadth cf the fair se eccncmy and its impcrtance tc the
lcn~-term ~rcwth cf the cverall U.8. eccncmy.
5
Whe pocymakers devole schcahl allehloh lo
copyrchl hrhcemehl, exceplohs lo copyrchl prolecloh
aso promole hhovaloh ahd are a maor calaysl o U.8.
ecohomc crowlh. 8pecc exceplohs lo copyrchl prolecloh uhder
U.8. ahd hlerhaloha aw, cassed here uhder lhe broad headhc o
ar use, are vla lo mahy hduslres ahd slmuale crowlh across
lhe ecohomy. Compahes behelhc rom ar use ceherale subslahla
revehue, empoy mohs o workers, ahd represehl ohesxlh o lola
U.8. CDF.
Uhder cudehes pubshed by lhe Word lhleeclua Froperly Orcah
zaloh (WlFO), ecohomc aclvly assocaled wlh copyrchls has beeh
sluded exlehsvey. Uhl lhe 2007 pubcaloh o Far Use h lhe U.8.
Ecohomy, however, lhe ecohomc cohlrbuloh o hduslres depehdehl
oh ar use had hol beeh quahled. Ths updale cohlhues lo lhe
cap ahd provdes a comprehehsve assessmehl o lhe ecohomc coh
lrbuloh ceheraled by compahes behelhc rom ar use ahd realed
mlalohs ahd exceplohs.
Far use s ah mporlahl reslrcloh lo lhe rchls coherred oh orcha
works by lhe U.8. Copyrchl Acl o 1976: The ar use o a copyrchled
work . s hol ah hrhcemehl o copyrchl.
1
The ar use doclrhe,
ahd olher mlalohs ahd exceplohs, have crowh h mporlahce wlh
lhe rse o lhe dcla ecohomy, as ar use permls a rahce o aclv
les lhal are crlca lo mahy hch lechhoocy bushesses ahd are ah
mporlahl ouhdaloh o lhe lhlerhel ecohomy.
The behecares o ar use ehcompass a broad rahce o compahes,
parlcuary lhose whose bushess aclvles hvove lhe lhlerhel. The
ubquly o lhe lhlerhel meahs lhal lhe ecohomc crowlh oslered by
ar use s wdespread ahd ceherales schcahl cohsumer behels.
!
!. 17 U.8.C. 107.
6
Exampes o lhese hduslres hcude:
mahuaclurers o cohsumer devces lhal aow hdvdua
copyhc o copyrchled procrammhc;
educaloha hsllulohs;
solware deveopers; ahd
lhlerhel search ahd web hoslhc provders.
These hduslres ahd olhers lhal depehd upoh ar use ahd realed
mlalohs ahd exceplohs are reerred lo here as ar use hduslres.
As summarzed h lhe oowhc reporl, lhe courls have hed h avor o
ar use h slualohs lhal are hlecra lo mahy hduslres. The courls
have eslabshed, or exampe, lhal ar use permls lhe mah servce
provded by search ehches, lhal solware deveopmehl depehds oh
makhc lemporary copes lo aclale lhe procrammhc o hleroper
ably, ahd lhal cohsumers cah make copes o leevsoh ahd rado
procrammhc or persoha use.
Far use hduslres have crowh dramalcay wlhh lhe pasl 20 years,
ahd lher crowlh has had a proouhd mpacl oh lhe U.8. ecohomy. Ths
reporl cohlahs delaed dala orcahzed by hduslry ahd summarzes
ecohomc aclvly ahd crowlh h ve areas:
"#$#%&# lh 2008 ahd 2009, ar use hduslres ceheraled lola
revehue averachc 84.6 lroh, a 35 percehl hcrease over 2002 revehue
o 83.4 lroh. lh percehlace lerms, lhe mosl schcahl crowlh over
lhs seveh year perod occurred h lhlerhel pubshhc ahd broadcaslhc
ahd web search porlas, eeclrohc shopphc ahd eeclrohc auclohs,
ahd olher hahca hveslmehl aclvly.
'()&#* +,,#, Far userealed hduslry vaue added h 2008 ahd
2009 averaced 82.4 lroh, approxmaley 17 percehl o lola U.8.
currehl doar CDF. Vaue added equas a rm's lola oulpul mhus ls
purchases o hlermedale hpuls ahd s lhe besl measuremehl o ah
hduslry's ecohomc cohlrbuloh lo haloha CDF.
7
Far use hduslres aso crew al a asler pace lhah lhe overa ecohomy.
The core ar use hduslres, whch accouhled or 9.2 percehl o lhe
ecohomy h 2002, accouhled or 19.7 percehl o U.8. rea ecohomc
crowlh rom 2002 lo 2009.
-./)01.#%2 Empoymehl h hduslres behelhc rom ar use
ahd realed mlalohs ahd exceplohs hcreased rom 16.9 moh h
2002 lo 17.7 moh h 2008. Due lo lhe mpacl o lhe recessoh, em
poymehl e back lo 17 moh h 2009. Aboul ohe oul o every echl
workers h lhe Uhled 8lales s empoyed h ah hduslry lhal behels
rom lhese proleclohs.
Furlher uslralhc lhe rapd crowlh o ar use hduslres, lola payros
expahded rapdy, rshc rom 8895 boh h 2002 lo ah averace o
more lhah 81.2 lroh durhc 2008 ahd 2009.
340,&526$621 Froduclvly, lhe amouhl o coods ahd servces lhal
cah be produced wlh a cveh humber o hpuls, s lhe ouhdaloh or
rshc vhc slahdards. From 2002 lo 2007, lhe produclvly o U.8.
ar use hduslres hcreased by 38 percehl lo heary 8137,000 per
empoyee. Froduclvly o ar use hduslres cohlhued lo hcrease
h lhe mosl recehl perod, rshc lo 8141,000 per empoyee h 2009,
a eve lhal crealy exceeds lhe ecohomywde averace produclvly
o 8108,000 per empoyee. Numerous researchers have delermhed
lhal compahes depehdehl oh ar use, such as hormaloh lechhoocy
compahes, have slmualed U.8. produclvly crowlh.
-7/0428 Exporls o coods ahd servces realed lo ar use hduslres
hcreased by 64 percehl rom 8179 boh h 2002 lo 8294 boh h
2008, ahd lheh e back lo 8266 boh h 2009. Wlhh lhs overa
hcrease, exporls o lraderealed servces, hcudhc lhlerhel or ohhe
servces, were lhe aslesl crowhc secmehl, hcreashc heary lehod
rom 8578 moh h 2002 lo ah averace o more lhah 85 boh
ahhuay h 20082009.
By ahy measure, lhe crowlh rale o ar use hduslres has oulpaced
overa ecohomc crowlh h recehl years, ueed produclvly cahs, ahd
supporled mohs o obs.
8
Throuch lhe hormaloh lechhoocy revouloh ahd lhe realed crowlh
o lhe lhlerhel, lhe U.8. ecohomy has beheled rom lhe crealoh ahd
rapd expahsoh o hew hduslres, ahd a revva o produclvly crowlh
lhal supporls hcher vhc slahdards.
The research hdcales lhal lhe hduslres behelhc rom ar use ahd
olher mlalohs ahd exceplohs make a arce ahd crowhc cohlrbu
loh lo lhe U.8. ecohomy. The ar use ecohomy h 2008 ahd 2009
accouhled or ah averace o 84.6 lroh h revehues ahd 82.4 lroh
h vaue added, rouchy ohesxlh o lola U.8. CDF. ll empoyed more
lhah 17 moh peope ahd supporled a payro o 81.2 lroh. Over
lhese lwo years, ar use compahes ceheraled 8561 boh h exporls
ahd oslered rapd produclvly crowlh.
The prolecloh aorded by ar use ahd olher mlalohs ahd exceplohs
has beeh a maor cohlrbulhc aclor lo lhese ecohomc cahs, ahd w
cohlhue lo supporl crowlh as lhe U.8. ecohomy becomes eveh more
depehdehl oh hormaloh hduslres.
9
Economic Contribution of Fair Use and
Information Technology Dependent
Industries to the U.S. Economy
I . I NTRODUCTI ON
lh 2003, lhe Word lhleeclua Froperly Orcahzaloh (WlFO) produced
a cude oh surveyhc lhe ecohomc cohlrbuloh o copyrchlbased
hduslres.
2
Eveh beore lhe cude was compeled, severa couhlres
had produced reporls assesshc ahd promolhc lhe roe o copyrchl
based hduslres.
3
lh cohlrasl, lhe arce ahd crowhc ecohomc
cohlrbuloh o hduslres lhal depehd oh ahd/or behel rom mla
lohs ahd exceplohs lo copyrchls, hcudhc lhe ar use o copyrchled
maleras, has hol beeh sluded exlehsvey. As wlh lhe orcha sludy,
lhe obeclve o lhs updale s lo lhe cap ahd, based oh a compre
hehsve revew o avaabe dala, eslmale lhe ecohomc aclvly ahd
scope o hduslres behelhc rom baahced copyrchl prolecloh.
Far use h lhe slrcl sehse s ah mporlahl slalulory reslrcloh oh
lhe rchls coherred oh orcha works by lhe U.8. Copyrchl Acl o
1976:
4
Accordhc lo 8ec. 107, [l|he ar use o a copyrchled work
or . . . purposes such as crlcsm, commehl, hews reporlhc, leachhc
(hcudhc mulpe copes or cassroom use), schoarshp, or research
s hol ah hrhcemehl o copyrchl.
5
The ar use doclrhe, ahd olher
9. Cude oh 8urveyhc lhe Ecohomc Cohlrbuloh o lhe CopyrchlBased
lhduslres, WlFO, Ceheva 2003 (WlFO Cude).
:. |d. Tabe 1.1 h lhe WlFO Cude sls 13 separale haloha sludes o copyrchl
hduslres. 8ee aso 8lepheh E. 8wek, Ccpyri~ht |ndstries in the U.8. Lccncmy:
The 2006 |epcrt, prepared fcr the |nternaticnal |ntellectal Frcperty Alliance
(||FA), November 2006, avaabe al ;;;<66/(<50..
=. Mchae A. Ehhorh, Media, Technclc~y and Ccpyri~ht: |nte~ratin~ |aw and
Lccncmics (Edward Ecar Fubshhc, 2004) al 1.
>. 17 U.8.C. 107. 8ee Ehhorh al 1 ahd 8, h. 5.
10
mlalohs ahd exceplohs lo copyrchl,
6
have crowh h mporlahce wlh
lhe rse o lhe dcla ecohomy, as ar use permls a rahce o aclvles
lhal are crlca lo mahy hch lechhoocy bushesses, hcudhc search
porlas ahd web hoslhc.
7
lh lhe dscussoh lhal oows, lhe lerm ar
use somelmes w be used as a shorlhahd expressoh reerrhc lo lhe
u rahce o mlalohs ahd exceplohs h U.8. copyrchl aw.
lhduslres behelhc rom ar use have crowh dramalcay wlhh lhe
pasl 20 years, ahd lher crowlh has had a proouhd mpacl oh lhe U.8.
ecohomy.
8
The deveopmehl ahd spread o lhe lhlerhel as a medum
or bolh bushess ahd persoha use has beeh crealve ahd lrahsorma
lve. The crealoh o hew bushesses (e.~., Cooce ahd Amazoh) ahd
bushess aclvles has h lurh ueed demahd rom olher seclors o lhe
U.8. ecohomy (e.~., ber oplcs, roulers, ahd cohsumer eeclrohcs)
ahd lrahsormed a hosl o bushess processes (e.~., commuhcalohs
ahd procuremehl).
The advehl o lhe lhlerhel ahd helworkhc lechhoocy aso has beeh
wdey credled wlh revvhc U.8. produclvly crowlh aler lwo decades
o beowlrehd produclvly.
9
As hcher produclvly s ah mporlahl
source o hcome lo abor ahd capla resources, lhe hew ecohomy
has heped spur overa crowlh ahd osel slruclura deches h olher
seclors o lhe ecohomy.
?. The compele sel o mlalohs ahd exceplohs sluded hereh are sled h Farl
ll ahd descrbed urlher h Appehdx l.
@. 8ee, e.~., Johalhah Bahd, Far Use: lls Eecls oh Cohsumers ahd lhduslry,
Teslmohy beore lhe Commllee oh Ehercy ahd Commerce, 8ubcommllee oh
Commerce, Trade, ahd Cohsumer Frolecloh (November 16, 2005).
A. For a leralure revew ahd dscussoh o lhe mpacl o lhe hew ecohomy
oh oca U.8. ecohomc slalslcs, see J. 8lepheh Lahdeed ahd Barbara M.
Fraumeh, Measurhc lhe New Ecohomy, 8urvey o Currehl Bushess (March
2001).
B. For a survey o lhe produclvlyrealed leralure, see Lahdeed ahd Fraumeh
al 278.
11
Far use o copyrchled malera ahd olher mlalohs ahd exceplohs
are ah mporlahl ouhdaloh o lhe lhlerhel ecohomy. For exampe,
ohe orce drvhc lhe expahsoh o lhe lhlerhel as a loo or commerce
ahd educaloh s lhe user's ably lo ocale useu hormaloh wlh
wdey avaabe search ehches.
10
The courls have hed lhal lhe mah
servce provded by search ehches s ar use.
11
Absehl lhe exceplohs
lo copyrchl aw provded by lhe ar use doclrhe, search ehche rms
ahd olhers woud ace uhcerlah ably or hrhcemehl, a schcahl
delerrehl lo provdhc lhs vauabe servce. 8uch ah oulcome woud
lhwarl lhe educaloha purposes ahd crowhc commerce aclaled by
lhlerhel search ehches, lhereby reduchc lhe ecohomc cohlrbuloh
o lhe lhlerhel.
Olher mporlahl aclvles made possbe by ar use hcude solware
deveopmehl, whch h mahy cases requres lhe makhc o lemporary
copes o exslhc procrams lo aclale solware hleroperably,
12

ahd web hoslhc, whch coud ead lo ably or ahy hrhcemehl by
users bul or mlalohs ahd exceplohs.
13
The ar use doclrhe aso
permls ehd users o copyrchled malera lo make dcla copes o
procrammhc or persoha use. Thus, because o ar use, cohsumers
!C. 8earch ehche solware copes vasl quahlles o hormaloh rom pubcy
accessbe websles ohlo lhe search ehche's dalabase. Users lheh access
lhe search ehche's dalabase or reevahl hormaloh, relrevhc hks lo lhe
orcha sle as we as lo lhe cache copy o lhe websle slored h
lhe dalabase.
!!. The Nhlh Crcul h Kelly v. Arriba 8cft, 336 F.3d 811 (9lh Cr. 2003) ouhd
lhal lhe cachhc o reducedszed maces coped rom websles, ahd lhe
dspay o lhese maces h respohse lo search queres, cohslluled a ar use.
ll rearmed lhal proposloh h Ferfect 10, |nc. v. Amazcn.ccm, |nc., 487
F.3d 701 (9lh Cr. 2007). 8mary, lhe dslrcl courl h |ield v. Ccc~le, 412 F.
8upp. 2d 1106 (D. Nev. 2006) excused Cooce's dspay o lexl cached h ls
search dalabase as a ar use.
!9. 8ee 8e~a v. Accclade, 977 F.2d 1510 (9lh Cr. 1992); Atari v. Nintendc, 975
F.2d 832 (Fed. Cr. 1992); 8cny v. Ccnnectix, 203 F.3d 596 (9lh Cr. 2000).
(Far use permls lhe copyhc lhal occurs durhc lhe course o solware
reverse ehcheerhc.)
!:. 8ecloh 512(c) o lhe Dcla Mehhum Copyrchl Acl (DMCA) provdes sae
harbors or lhe ehlles hoslhc user cohlehl.
12
cah ehoy copyrchled procrammhc al a aler lme (lme shlhc),
14

lrahser lhe malera rom ohe devce lo aholher (space shlhc),
15

ahd make lemporary cache copes o websles oh lhe rahdom access
memory (RAM) o lher compulers.
16
The ully derved rom lhese ac
lvles has spawhed cohsumer purchases o a broad rahce o producls
such as dcla vdeo recorders ahd MF3 payers, slmualhc addloha
ecohomc aclvly h lhe Uhled 8lales ahd h a o lhe couhlres where
lhe machhes used or lhese aclvles are mahuaclured.
Cerlahy, copyrchl prolecloh provdes ah hcehlve or lhe produc
loh o crealve works ahd lhese works have a poslve mpacl oh lhe
U.8. ecohomy. The poslve aspecls o copyrchl prolecloh shoud hol,
however, obscure lhal ar use s aso a vla ecohomc drver h lhe
dcla ace. The recochloh o lhe ecohomc behels o lhe dcla
ecohomy made possbe by ar use speccay, ahd lhe mlalohs ahd
exceplohs lo copyrchl aw h cehera, have ed lo a sprled debale oh
lhe roe o copyrchl aw h lhe dcla ace.
17

To cohlrbule lo lhe debale, lhs reporl presehls a comprehehsve quah
lcaloh o lhe crowhc ecohomc schcahce o hduslres behelhc
rom ar use. The melhodoocy used h lhe reporl dehes a sel o
core hduslres lhal elher woud hol exsl, or woud be much smaer,
bul or lhe mlalohs ahd exceplohs lo copyrchl aw. lh lurh, smar
lo lhe WlFO melhodoocy, we aso evauale lhe secohdary seclors or
hohcore hduslres lhal behel rom ar use.
18
The presehl ehdeavor
!=. 8cny Ccrp. v. Universal City 8tdics, |nc., 464 U.8. 417, 42324 (1984).
!>. |eccrdin~ |ndstry Ass'n cf America v. Diamcnd Mltimedia 8ys., |nc., 180 F.3d
1072, 1079 (9lh Cr. 1999).
!?. Ferfect 10, |nc. v. Amazcn.ccm, |nc., 487 F.3d 701 (9lh Cr. 2007).
!@. For ah expahaloh o bolh vews, see Joseph Ferre ahd Car 8hapro,
lhleeclua Froperly, Compelloh, ahd lhormaloh Techhoocy, h Ha
Varah, Joseph Ferre, ahd Car 8hapro, eds., The Ecohomcs o lhormaloh
Techhoocy (Cambrdce Uhversly Fress, Bahca lhlessa, 2004) al 5861.
!A. The WlFO ramework or evaualhc copyrchlbased hduslres succesls
4 calecores: core, hlerdepehdehl, parla, ahd hohdedcaled supporl
hduslres. WlFO Cude al 2735. As dscussed h 8ecloh ll, lhs reporl
adopls a smar bul more slreamhed dehloh o core ahd hohcore hduslres.
13
s by ho meahs lhe ha word oh lhe subecl, bul we hope lhal l w
serve as a slmuus lo urlher rehemehl ahd beller uhderslahdhc o
lhe dcla ecohomy ahd lhe mporlahl roe ahd ecohomc cohlrbuloh
made by ar use h lhe dcla ace.
I I . DESCRIPTION OF FAIR USE BENEFITS AND INDUSTRIES
+<* DE#*F#%#G628*0G*H(64*I8#*(%,*J2E#4*K6.62(260%8*(%,*-75#/260%8*20**
* L0/146ME2*K(;
Mahy hduslres behel rom provsohs o U.8. copyrchl aw lhal a
uhder lhe broad headhc o ar use.
19
For exampe, lhe Olher lhor
maloh 8ervces hduslry (NAlC8 519),
20
whch hcudes lhe subsel
hduslry, lhlerhel Fubshhc ahd Broadcaslhc ahd Web 8earch
Forlas, rees oh lhe oowhc ar userealed provsohs:
!B. Ths secloh o lhe reporl was prepared wlh lhe assslahce o Froessor
Feler Jasz o Amercah Uhversly Washhcloh Coece o Law.
9C. NAlC8 reers lo lhe Norlh Amercah lhduslry Casscaloh 8yslem, lhe
slahdard used by Federa slalslca acehces or cassyhc bushess
eslabshmehls or lhe purpose o coeclhc, ahayzhc, ahd pubshhc
slalslca dala realed lo lhe U.8. bushess ecohomy.
N2(2&2041*340$6860% O#8546/260%
102(a) hohcopyrchlably o acls
102(b) dea/expressoh dcholomy
107
ar use: crlcsm; commehl; hews reporlhc;
browser, cache copes; leachhc; schoarshp;
research
108 brary uses
109 rslsae doclrhe
512 l8F sae harbors
302304 copyrchl lerm
105 ho copyrchl h U.8. Coverhmehl works
14
Appehdx l cohssls o a labe lhal uslrales how hdvdua provsohs
appy lo ahd behel core ahd hohcore hduslres.
21
The labe repre
sehls, by 2007 NAlC8 calecory ahd descrploh, lhose hduslres lhal
depehd oh ar use.
22
Each NAlC8 code s oowed by clalohs lo
slalulory provsohs ahd prhcpes o aw embodyhc lhe mlalohs
ahd exceplohs upoh whch lhe descrbed hduslry depehds. The ac
compahyhc cossary suppemehls lhe dscussoh o each ar use
provsoh ahd dehles reevahl courl decsohs.
The ourlh coumh h lhe Appehdx l labe aso summarzes ahd hch
chls lhe exlehded mpacl o ar use across humerous seclors, as
lhe crossreerehces lo olher NAlC8 codes dehly hlerdepehdehl
hduslres. For exampe, or lhe Olher lhormaloh 8ervces hduslry,
lhe labe sls ve hlerdepehdehl hduslres: 3341 (compuler ahd pe
rphera equpmehl mahuaclurhc); 5112 (solware pubshers); 5415
(compuler syslem desch ahd realed servces); 334413 (semcohduc
lors ahd realed devce mahuaclurhc); ahd 3346 (mahuaclurhc ahd
reproduchc machelc ahd oplca meda).
9!. The dala appehdxes or lhs reporl are avaabe ohhe al
hllp://www.ccahel.orc.
99. Ths reporl uses lhe 2007 versoh o lhe Norlh Amercah lhduslra
Casscaloh 8yslem (2007 NAlC8). The 1997 NAlC8 repaced lhe od 8lC
slahdard. lh lhe NAlC8 cohvehloh, a lwodcl humber reers lo ah hduslry
seclor. For exampe, code 51 reers lo lhe lhormaloh seclor. Three, our
ahd vedcl codes reer lo ah hduslry subseclor, ah hduslry croup, ahd
hduslry, respeclvey. Codes o sx or more dcls are aso cohsdered
hduslres h lher owh rchl eveh lhouch lhey are parl o a arcer hduslry.
Ths sludy hcorporales dala mosly al lhe lhree ahd ourdcl hduslry
croup eve, ahd, as approprale, al lhe veormoredcl hduslry eve,
wlhoul doube couhlhc. For ease o reerehce, lhe Appehdx l allached
lo lhs reporl sls lhe NAlC8 2007 codes ahd oca descrplohs o lhe
hduslres ahd hduslry croups cohsdered.
15
F<* H(64*I8#*P%,&8246#8Q*L04#*(%,*R0%SL04#
Ths sludy adopls lhe cudehes succesled by WlFO, ahd used h olher
sludes, lo evauale lhe ecohomc cohlrbuloh o ar use.
23
However,
hslead o dehhc our dslhcl croups o hduslres as succesled h
lhe WlFO cudehes, lhe sludy empoys a smper casscaloh hlo
core ahd hohcore hduslres lhal depehd oh or behel rom ar use.
Core hduslres are dehed as hduslres lhal produce coods ahd
servces whose aclvles depehd h arce measure oh lhe exslehce o
mlalohs ahd exceplohs provded h U.8. copyrchl aw. As showh h
Appehdx l, lhe core covers a broad rahce o hduslres whose oulpul
s drveh hcreashcy by aclvles made possbe by ar use, hcudhc
mahy lhal depehd exlehsvey oh lhe lhlerhel.
24
Due lo lhe halure o
lhe lhlerhel h parlcuar lhe hlehsve use o lemporary copes a
o lhe lhlerhelbased hduslry croups ahd hduslres are cassed h
lhe ar use core.
Olher hormaloh hduslres depehd oh ar use exceplohs or lher
ably lo ehcace h basc aclvles. Addloha core seclors, such as lhe
educaloh hduslry, behel rom lhe hohcopyrchlably o acls ahd
olher ar use reedoms.
25

lh addloh lo lhese core hduslres, hohcore seclors aso behel
schcahly rom ar use. Nohcore hduslres hcuded h lhs
sludy cohssl o hduslres whose aclvles or oulpul aclales
9:. 8ee WlFO Cude al 32. As holed by WlFO, lhe dehloh ahd dehlcaloh
o 'hohcore' hduslres has beeh characlerzed by bur [sc| borders ahd
requehl chahces across borders.
9=. For exampe, recehl advahces h processhc speed ahd solware uhclohaly
are behc used lo lake advahlace o lhe rcher mulmeda experehce how
avaabe rom lhe web. Thus, purchases o hew compulers ahd solware
hcreashcy are drveh by lhe desre lo maxmze lhe lhlerhel experehce,
ralher lhah lo hcrease word processhc ahd spreadsheel perormahce.
9>. 8ee, e.~., Kurl Larseh ahd 8lphah VhcehlLarseh, The lmpacl o lTC oh
Terlary Educaloh, h Brah Kahh ahd Domhque Foray, eds., Advancin~
Kncwled~e and the Kncwled~e Lccncmy (MlT Fress, 2006) al 151168.
16
lhe oulpul o lhe ar use core. Compahes h lhese seclors derve
a schcahl amouhl o lher currehl bushess rom lhe demahd
ceheraled by ar use ahd lhe lhlerhel, ahd are hlerdepehdehl wlh lhe
core hduslres.
26
The lhlerhel ecohomy s dyhamc ahd, as l expahds, huehces a
crowhc rahce o seclors.
27
The hduslry casscaloh scheme used
or lhs sludy oows a cohservalve approach ahd mls lhe core ahd
hohcore hduslres lo lhe seclors sled h Appehdx l. 8ubsequehl
sludes, behelhc rom addloha dala sources, revsed oca cas
scalohs, ahd avaabe hormaloh, may show a ar crealer scope o
core ahd hohcore aclvly derved rom ar use.
28

I I I . METHODOLOGY AND DATA SOURCES
Ths sludy quahles lhe ecohomc cohlrbuloh o core ahd hohcore
hduslres h 2008 ahd 2009 based oh ve ecohomc measures:
revehue, vaue added, empoymehl, payro, ahd exporls.
29
The orcha
reporl presehled dala or 2002 ahd 2006. The rsl updale, reeased
h 2010, reed arcey oh dala h lhe 2007 Ecohomc Cehsus. lssued
every ve years, lhe Ecohomc Cehsus provdes a delaed porlral o
9?. WlFO advocales lhe hcusoh o such hlerdepehdehl copyrchl hduslres
as parl o copyrchlbased hduslres. WlFO dehes hlerdepehdehl
hduslres as hduslres lhal are ehcaced h producloh, mahuaclure, ahd
sae o equpmehl whose uhcloh s whoy or prmary lo aclale lhe
crealoh, producloh, or use o works ahd olher prolecled subecl maller.
8ee WlFO Cude al 33.
9@. Accordhc lo ohe recehl sludy, lhe lhlerhel accouhled or approxmaley 3.8
percehl o lhe U.8. ecohomy h 2009, McKhsey Coba lhsllule, lhlerhel
mallers: The Net's sweepin~ impact cn ~rcwth, jcbs, and prcsperity (May 2011) 15.
9A. As lhe lhlerhel ecohomy crows, l s key lhal lhe U.8. Deparlmehl o
Commerce ahd olher acehces w expahd ahd rehe lher dala coecloh
eorls lo lrack lhs crowlh.
9B. Ths approach s cohsslehl wlh lhe WlFO Cude whch succesls measurhc
lhe sze o lhe hduslres as a percehlace o CDF, empoymehl, ahd orech
lrade. WlFO Cude al 36.
17
lhe U.8. ecohomy rom lhe haloha lo lhe oca eve, ahd lhese resuls
are used lo rehe ahd revse lhe U.8. Coverhmehl's exslhc dala
coecloh procrams.
30
The updales h lhs reporl are based oh lhe
Ecohomc Cehsus, bul hecessary musl hcorporale hormaloh rom
olher coverhmehl pubcalohs lhal cover years lhal lhe Ecohomc
Cehsus does hol.
A delaed dscussoh o lhe melhodoocy ahd sources used lo compe
lhe dala presehled h lhs updale s provded h Appehdx ll. Dala or
lhe key ecohomc measures sled beow revehue, vaue added, payro
ahd empoymehl are comped separaley or core ahd hohcore h
duslres accordhc lo lhe slruclure deveoped wlh lhe assslahce o
Froessor Feler Jasz, as descrbed above ahd delaed h Appehdx
l.
31
8ummary labes are provded h Appehdces lll lhrouch Vll. Dala
or lhese hduslres were comped by NAlC8 code ahd orcahzed h a
dalabase. Wheh dala rom lhe prmary source was uhavaabe, elher
due lo pubcaloh acs or dscosure cohslrahls, olher oca sources
were cohsuled lo eslmale lhe msshc dala pohls.
I V. ECONOMIC CONTRIBUTION OF FAIR USE INDUSTRIES
Ushc lhe dala sources ahd melhodooces descrbed h Appehdx ll,
lhs secloh presehls eslmales o lhe revehues, vaue added, payro,
empoymehl eves, produclvly, ahd lrade o lhe core ahd hohcore
hduslres behelhc rom ar use.
:C. 8ee U.8. Cehsus Bureau, 2007 Ecohomc Cehsus User Cude (March 24,
2009) al 4 ahd 14.
:!. Dala or exporls o coods ahd servces are loo accrecaled lo be brokeh dowh hlo
core ahd hohcore compohehls, ahd are presehled wlh lhe lwo
compohehls combhed.
18
+<* "#$#%&#*
Charl 1 uslrales lhe eslmaled revehues or lhe ar userealed core
ahd hohcore hduslres or 2002, ahd 2006 lhrouch 2009. Tola
revehue o ar use hduslres hcreased by more lhah ohe lroh doars
rom 83.4 lroh h 2002 lo 84.7 lroh h 2007 ahd 2008, beore
dechhc lo 84.5 lroh h 2009. The revehue or lhe core versus
hohcore croup hcreased al a asler rale as core ar use revehues
expahded by 42 percehl rom 2002 lo 2009, whe hohcore revehues
expahded by 19 percehl.
32

The slrohc revehue crowlh by lhe core hduslres has beeh drveh by
crowlh h severa hduslres. As showh h Appehdx lll, lhe mosl sch
cahl crowlh occurred h hsurahce, archleclura, ehcheerhc, ahd eca
servces, eeclrohc shopphc, securles brokerace, ahd olher hahca
hveslmehl aclvly. For hohcore hduslres, lhe arcesl crowlh was h
leecommuhcalohs (bolh wred ahd wreess), ahd compuler syslems
ahd desch.
:9. Appehdx lll cohlahs labes delahc revehue or each core ahd
hohcore hduslry.
Chart 1. Revenues of Fair Use Industries
Total Revenue = $4.5 trillion in 2009
2002 2006 2007 2008 2009
$3.4 tril.
$1,636
$1,799
$4.4 tril.
$2,550
$1,893
$2,036 $2,088
$2,652
$2,568 $2,562
$1,940
$4.7 tril.
$4.5 tril.
$4.7 tril.
19
F<* '()&#*+,,#,
Vaue added measures lhe cohlrbuloh o each hduslry's abor ahd
capla lo ls cross oulpul ahd lo CDF. lhduslry vaue added equas ah
hduslry's cross oulpul mhus ls purchased hlermedale hpuls. Vaue
added s ah mporlahl loo lo measure ecohomc crowlh because l does
hol hcude vaue added by aholher hduslry or doube couhl owhhduslry
vaue added.
As showh h Charl 2, lhe vaue added or lhe ar use hduslres dehed
h lhs reporl hcreased schcahly rom 81.7 lroh h 2002 lo 82.2
lroh h 2006, reachhc 82.4 lroh h 2007 lhrouch 2009. The core h
duslres accouhled or approxmaley 60 percehl o lola ar use hduslry
vaue added. The vaue added dala show lhal core ahd hohcore ar use
hduslres represehled, by 2009, more lhah ohesxlh o currehl doar
U.8. CDF.
33
The core ahd hohcore shares o CDF h 2009 were 10.3
percehl ahd 6.8 percehl respeclvey. As wlh revehue, lhe crowlh rale or
::. U.8. CDF h currehl doars was 810.6 lroh h 2002, 814.4 lroh h 2008, ahd 814.1
lroh h 2009. For a lme seres o U.8. currehl doar ahd rea CDF, see E22/QTT;;;<
U#(<M0$T%(260%()T7)8TM,/)#$<7)8 ahd E22/QTT;;;<U#(<M0$T6%,&8241TM,/U16%,V,(2(<
E2.< The CDF eslmales h lhs sludy are based oh lhe aller.
Chart 2. Value Added of Fair Use Industries
Total Revenue = $2.4 trillion in 2009
2002 2006 2007 2008 2009
$1.7 tril.
$695
$976
$2.2 tril.
$1,429
$807
$959
$1,440
$2.4 tril.
$966
$1,440
$2.4 tril.
$955
$1,451
$2.4 tril.
20
core ar use hduslres oulpaced crowlh h lhe hohcore seclors. From
2002 lo 2009, core vaue added hcreased by 49 percehl compared lo
hohcore crowlh o 37 percehl.
34

lh lola, by 2009, ar use hduslres accouhled or 17 percehl o U.8.
currehl doar (i.e., homha) CDF. lh a, lhe core ahd hohcore ar
use hduslres cohlrbuled 8571 boh lo U.8. CDF crowlh durhc lhe
2002 lo 2007 perod, accouhlhc or 17 percehl o U.8. currehl doar
ecohomc crowlh.
lh cohlrasl lo homha CDF, rea CDF cohlros or haloh, ahd s
lhereore a beller hdcalor o a couhlry's lrue ecohomc crowlh. As
holed h lhe prevous updale o lhs reporl, h mahy o lhe ar use
hduslres, prces deched durhc lhe 2002 lo 2007 perod, meahhc
lhal lhe rea crowlh o vaue added was eveh arcer lhah mped by lhe
currehl doar crowlh. Wheh haloh s lakeh hlo accouhl, lhe crowlh
cohlrbuloh o lhe core hduslres lo U.8. oulpul crowlh durhc 2002
lo 2009 was 19.7 percehl, more lhah doube lher wechl h homha
CDF h 2002.
35

:=. Appehdx lV cohlahs labes delahc vaue added or core ahd
hohcore hduslres.
:>. The eslmaloh procedure or lhe core cohlrbuloh lo rea CDF crowlh s showh h
Appehdx V.
21
L<* -./)01.#%2*(%,*3(140))
The ar userealed hduslres measured h lhs reporl are maor
empoyers h lhe U.8. ecohomy. Charl 3 beow shows lhe humber o
empoyees or 2002, ahd 2006 lhrouch 2009. Empoymehl realed lo
ar use hcreased rom 16.9 moh h 2002 lo 17.7 moh h 2008,
beore ahc back lo 17.0 moh h 2009.
Empoymehl h lhe core hduslres hcreased rom 10.1 moh
empoyees h 2002 lo 10.3 moh h 2008.
36
Empoymehl h lhe
hohcore hduslres expahded rom 6.8 moh empoyees h 2002 lo
7.3 moh workers h 2008. lh 2009, lola empoymehl h core ahd
hohcore hduslres ake e back cose lo lher 2002 eves. lh 2009,
empoymehl h ar use hduslres accouhled or 13 percehl o lola
hoharm empoymehl h lhe Uhled 8lales.
37
Thal s, aboul ohe oul
o every echl workers h lhe Uhled 8lales s empoyed h ah hduslry
lhal behels rom lhe prolecloh aorded by ar use.
:?. Appehdx Vl cohlahs labes delahc empoymehl or each core ahd
hohcore hduslry.
:@. Dala oh empoymehl by hduslry are avaabe al
E22/QTT;;;<U)8<M0$T5#8TE0.#<E2.W,(2(<
16.9 mil.
6,815
10,099
7,225
10,216
7,251
10,293
7,047
9,979
2002 2006 2007 2008 2009
17.4 mil. 17.5 mil.
10,340
17.7 mil.
17.0 mil.
7,332
Chart 3. Employment of Fair Use Industries
Total Employment = 17.0 million in 2009
22
Whe empoymehl eves have beeh realvey slabe, lola ar use
hduslry payro has beeh expahdhc. Charl 4 shows lhal lola ar
use hduslry payro hcreased by 43 percehl rom approxmaley 8900
boh h 2002 lo heary 81.3 lroh h 2008, beore dechhc lo 81.2
lroh h 2009. lh 2002, core hduslry payro was 8558 boh, ac
couhlhc or 62 percehl o lola ar use payros. Durhc 20082009,
core hduslry payro averaced 8811 boh, accouhlhc or 65 percehl
o lola ar use payro. From 2002 lo 2009, lhe payro o core h
duslres crew by 41 percehl, whe lhe payro o hohcore hduslres
crew by 26 percehl.
38
lh rea lerms, lhe payro o core ar use hdus
lres hcreased by 18 percehl rom 2002 lo 2009, whe lhe payro o
hohcore hduslres crew by 6 percehl.
39

:A. Appehdx Vll cohlahs labes delahc payro or each core ahd
hohcore hduslry.
:B. Fayro vaues were dealed by lhe cohsumer prce hdex or urbah
cohsumers (seres lD CUUR00008A0,CUU800008A0).
2002 2006 2007 2008 2009
Chart 4. Payroll Fair Use Industries
Total Payroll = $1.2 trillion in 2009
$0.9 tril.
$1.1 tril.
$1.2 tril.
$558
$704
$751
$337
$407
$408
$443
$788
$424
$834
$1.3 tril.
$1.2 tril.
23
The combhaloh o slabe empoymehl eves ahd hcreashc payros
has produced a szeabe hcrease h payro per empoyee al ar usere
aled rms. Tabe 1 beow hdcales lhal payro per empoyee expahded
rom approxmaley 853,000 per year h 2002 lo ah averace o heary
872,000 h 2008 ahd 2009. Fayro per empoyee h lhe core hduslres
s eveh hcher, averachc heary 880,000 h 2008 lhrouch 2009.
40
O<* 340,&526$621
Oh lhe suppy sde, a couhlry's ecohomc crowlh depehds overwhem
hcy oh lwo aclors: chahces h lhe eve o produclve hpuls such
as abor ahd capla, ahd lhe produclvly wlh whch lhose hpuls are
used. lh olher words, ah ecohomy experehces ecohomc crowlh l
adds hpuls (e.~., more workers ahd more machhes), hcreases lhe
oulpul assocaled wlh a cveh eve o hpuls, or does bolh.
lh order lo mprove lhe earhhcs or abor, by hcreashc rea houry
waces, or exampe, l s hecessary lo hcrease produclvly.
41

Rshc produclvly s lhereore lhe key lo ohclerm mprovemehls h
vhc slahdards.
=C. Because lhe Cehsus dala do hol hcude payro dala or NAlC8 5251
(hsurahce ahd empoyee behel uhds), lhs hduslry was excuded rom
lhe cacualohs.
=!. For exampe, crowlh s acheved soey by addhc workers wlhoul
hcreashc produclvly, lheh waces w hol rse h lhe ohc lerm.
D(U)#*!<*3(140))*3#4*-./)01##*0G*H(64*I8#*"#)(2#,*P%,&8246#8
O0))(48*/#4*#./)01##
9CC9 9CC? 9CC@ 9CCA 9CCB
L04# 55,288 68,907 72,946 80,703 78,968
R0%S504# 49,407 56,292 56,200 60,479 60,127
D02() 52,919 63,681 66,024 72,312 71,170
N0&45#8Q Aulhors' eslmales based oh dala rom lhe U.8. Cehsus Bureau ahd
Bureau o Labor 8lalslcs.
24
A arce body o work allrbules lhe hcher produclvly crowlh durhc
ahd aler lhe ale 1990s lo lhormaloh Techhoocy (lT) produchc
seclors servhc lhe hew ecohomy, ahd recehl work hdcales lhal
lTushc hduslres, hol usl lTproduchc hduslres, are hcreashc
produclvly as we.
42

Vaue added per empoyee s a commoh hdcalor used lo measure
abor produclvly. Tabe 2 cohlahs eslmales o abor produclvly or
lhe core ahd hohcore ar use hduslres.
The dala h Tabe 2 hchchls lhe very slrohc produclvly crowlh h
bolh lhe core ahd hohcore hduslres. From 2002 lo 2009, core ahd
hohcore produclvly hcreased by 50 percehl ahd 33 percehl, respec
lvey. Oh ah halohadusled bass, rea produclvly o core ahd
hohcore hduslres expahded 25 percehl ahd 15 percehl, respeclvey.
=9. 8ee, e.~., Erk Bryhossoh ahd Lorh M. Hll, Compulhc Froduclvly: Frm
Leve Evdehce (Juhe 2003); MlT 8oah Workhc Faper No. 421001. Dae
W. Jorcehsoh ahd Kevh J. 8lroh, Rashc lhe 8peed Lml: U.8. Ecohomc
Crowlh h lhe lhormaloh Ace (May 1, 2000); Tarek M. Harchaou, Faouz
Tarkhah & Bks Khaham, lhormaloh Techhoocy ahd Ecohomc Crowlh
h lhe Cahadah ahd U.8. Frvale Ecohomes, h Jorcehsoh, ed., Ecohomc
Crowlh h Cahada ahd lhe Uhled 8lales h lhe lhormaloh Ace (2004);
Lccncmic |epcrt cf the Fresident: 2002 (CFO: February 2002) al 5860; ahd J.
8leveh Lahdehed ahd Barbara M. Fraumeh, Measurhc lhe New Ecohomy,
8rvey cf Crrent Bsiness (March 2001) al 2339.
D(U)#*9<*'()&#*+,,#,*3#4*-./)01##*0G*H(64*I8#*"#)(2#,*P%,&8246#8
O0))(48*/#4*#./)01##
9CC9 9CC? 9CC@ 9CCA 9CCB
L04# 96,681 139,863 139,943 139,260 145,402
R0%S504# 101,954 111,736 132,263 131,778 135,549
D02() 98,806 128,211 136,769 136,156 141,324
N0&45#8Q Aulhors' eslmales based oh dala rom lhe U.8. Cehsus Bureau,
Bureau o Ecohomc Ahayss, ahd Bureau o Labor 8lalslcs.
25
As lhe empoymehl rale hcreased durhc lhe recessoh, produclvly
crew ah addloha 3 lo 4 percehl. Furlher, ar use hduslres have
ed U.8. crowlh as produclvly h lhe ar use ecohomy o 8141,000
per empoyee crealy exceeds ecohomywde produclvly, whch was
approxmaley 8108,000 per empoyee h 2009.
43
-<* D4(,#
The cobazaloh o lhe U.8. ecohomy has beeh ohe o lhe prmary
ecohomc lrehds h recehl decades. U.8. lrade h coods ahd servces how
accouhls or heary 25 percehl o U.8. CDF.
44
Whe lhe Uhled 8lales
ruhs a arce decl h merchahdse lrade, l lradlohay has ruh a surpus
h servces lrade, ahd s beeved lo hod a comparalve advahlace h mahy
servce seclors. lh 2008 ahd 2009, lhe Uhled 8lales surpus h servces
lrade averaced 8151 boh.
45

Exporls are ah hcreashcy mporlahl source o saes or rms behelhc
rom ar use.
46
U.8. mahuaclurers have a ohc hslory h orech markels,
bul mahy lhlerhel rms are realvey hew exporlers. Due lo hlerhaloha
derehces h copyrchl aw ahd lhe mporlahce o lhe lhlerhel lo lhe U.8.
ecohomy, U.8. lrade ocas have hcorporaled cerlah l8F sae harbors
hlo ree lrade acreemehls. 8uch provsohs are hecessary or U.8. lhlerhel
servce exporlers, such as l8Fs ahd search ehches, lo uy exercse lher
comparalve advahlaces h orech markels.
=:. The haloha lola s based oh currehl doar CDF dvded by lhe ahhua
averace o seasohay adusled mohlhy hoharm empoymehl eves reporled
by BL8 (seres lD CEU0000000001).
==. 8ee Bureau o Ecohomc Ahayss, Cross Domeslc Froducl: Tabe 1.1.5 (Lasl
Revsed oh Juhe 24, 2011). Exporls o coods ahd servces h 2009 were
81,578.4 boh, mporls were 81,964.7 boh, ahd U.8. currehl doar CDF
was 814,119 boh.
=>. Bureau o Ecohomc Ahayss, U8 lhlerhaloha 8ervces, Tabe 1 (asl
moded May 23, 2011). U.8. prvale servce exporls h 200809 averaced
8501 boh, whe servce mporls averaced 8350 boh.
=?. Thouch lhe revehue rom lhe coods ahd servces exporls o ar use
hduslres s hcuded h lhe revehues ahd vaue added aready measured
above, exporls are aso reporled separaley h order lo hchchl lhe crowhc
mporlahce o lrade lo lhose hduslres.
26
Charl 5 shows lhal eslmaled ar use hduslry exporls hcreased by 64
percehl rom 8179 boh h 2002 lo 8294 boh h 2008.
47
Far use
exporls e by heary 830 boh h 2009 bul coods exporl dala ahd cehera
wordwde ecohomc crowlh succesl lhal ar use exporls key rebouhded
h 2010.
48
Due lo lhe hch eve o accrecaloh o servces lrade dala, l
s hol praclca lo dslhcush belweeh core ahd hohcore exporls. Accord
hcy, Charl 5 hchchls exporls o lola ar use coods ahd servces.
Uhke overa exporls, whch are domhaled by coods, ar use hduslry
exporls are orehled loward servces. Fhahca servces cohsllule lhe
arcesl porloh o ar use servce exporls, accouhlhc or 30 percehl
o lola servces exporls h 20082009. Olher eadhc calecores wlh
schcahl exporl crowlh hcude mahacemehl ahd cohsulhc servces,
R&D ahd lechhca servces, ahd educaloh. Embemalc o lhe
=@. Appehdx Vlll cohlahs labes delahc ar use exporls o coods ahd servces
by calecory.
=A. As o lhe dale o lhs reporl, 2010 exporl dala or coods are avaabe ahd
show lhal ar use exporls hcreased by 15 percehl rom 875 boh h 2009
lo 886 boh h 2010. 8ervces exporl dala or 2010 are hol yel avaabe
bul aso are expecled lo show a schcahl hcrease.
2002 2006 2007 2008 2009
Goods
Services
Chart 5. Exports for Fair Use Industries
$177 bil.
86.8
90.4
$249.5 bil.
99.3
150.2
$279 bil.
100.1
178.9
$294.4 bil.
99.3
195.1
$266.3 bil.
75.1
191.2
27
=B. Brah Kahh ahd Domhque Foray, eds., Advahchc Khowedce ahd lhe
Khowedce Ecohomy (MlT Fress, 2006) al x.
dramalc crowlh o lhe lhlerhel as a bushess loo, exporls o lrade
realed servces, hcudhc lhlerhel or ohhe servces, rose hheod
rom 8578 moh h 2002 lo ah averace o more lhah 85 boh h lhe
2008 lo 2009 perod, lhe mosl rapd crowlh amohc a lhe hduslres
represehled. Oh lhe coods sde, semcohduclors, compulers, ahd
commuhcalohs equpmehl accouhled or more lhah echly percehl o
ar use hduslry exporls.
V. CONCLUSI ONS
The U.8. ecohomy s ah hcreashcy khowedcebased ecohomy lhal
behels rom lhe dyhamc dversly o core ahd hohcore ar use h
duslres. These khowedcebased hduslres h lurh spur producloh o
addloha coods ahd servces lhal urlher ue ecohomc crowlh.
The hormaloh lechhoocy revouloh ahd lhe lhlerhel have lrahs
ormed how hormaloh s lrahsmlled ahd used.
49
As a resul, lhe
U.8. ecohomy has beheled lremehdousy rom lhe crealoh ahd rapd
expahsoh o hew hduslres, ahd a revva o produclvly crowlh lhal
supporls hcher vhc slahdards.
The crowlh o lhe lhlerhel dd hol occur, o course, h a vacuum. lh
addloh lo lechhoocca advahcemehls, ehchlehed mlalohs ahd
exceplohs lo U.8. copyrchl aw have hurlured lhlerhel hduslres by
provdhc space or lhem lo deveop ahd expahd lher servce oerhcs
lo meel lhe heeds o cohsumers ahd bushesses. Ths lrahsormaloh
has ed lo a surce h lhlerhel usace, ahd spurred purchases o lhlerhel
hraslruclure ahd compulers, lhe deveopmehl o hew lhlerhel app
calohs, ahd ah exposoh o lhlerhelbased lrahsaclohs lhal behel
cohsumers ahd a broad rahce o bushesses.
Ths reporl has souchl lo measure lhe oolprhl o ar use oh lhe U.8.
ecohomy. ll has cohsdered hol ohy lhe core ar use hduslres, bul
aso lhe suppers o coods ahd servces lo lhe ar use core, as we as
maor users.
28
The research hdcales lhal lhe hduslres behelhc rom ar use ahd
olher mlalohs ahd exceplohs make a arce ahd crowhc cohlrbu
loh lo lhe U.8. ecohomy. The ar use ecohomy h 2008 ahd 2009
accouhled or ah averace o 84.6 lroh h revehues ahd 82.4 boh h
vaue added, rouchy 17 percehl o U.8. CDF. ll empoyed more lhah
17 moh peope ahd supporled ah ahhua payro o more lhah 81.2
lroh. Addlohay, lhe ar use ecohomy ceheraled 8561 boh h
exporls ahd ueed rapd produclvly crowlh.
The prolecloh aorded by ar use has beeh a maor cohlrbulhc aclor
lo lhese ecohomc cahs, ahd w cohlhue lo supporl crowlh as lhe U.8.
ecohomy becomes eveh more depehdehl oh hormaloh hduslres.
29
References
Bureau o Labor 8lalslcs, Deparlmehl o Labor, Crrent Lmplcyment
8tatistics, al E22/QTT;;;<U)8<M0$T5#8T
Bureau o Ecohomc Ahayss, Deparlmehl o Commerce, Ahhua
lhduslry Accouhls, al E22/QTT;;;<U#(<M0$T6%,&8241T6%,#7<E2.W(%%&()
Ehhorh, Mchae A., Media, Technclc~y and Ccpyri~ht: |nte~ratin~ |aw
and Lccncmics. (Norlhamploh, MA: Edward Ecar Fubshhc, 2004).
Kahh, Brah ahd Domhque Foray, eds., Advancin~ Kncwled~e and the
Kncwled~e Lccncmy. (Cambrdce, MA: MlT Fress, 2006).
Kahh, Brah ahd Ha R. Varah, eds., |nternet Fblishin~ and
Beycnd: The Lccncmics cf Di~ital |nfcrmaticn and |ntellectal Frcperty.
(Cambrdce, MA: MlT Fress, 2000).
Lahdeed, J. 8leveh ahd Barbara Fraumeh, Measurhc lhe New
Ecohomy, 8rvey cf Crrent Bsiness. March 2001.
Lahdeed, J. 8leveh ahd Roberl F. Farker, BEA's Chah lhdexes, Tme
8eres, ahd Measures o LohcTerm Ecohomc Crowlh, 8rvey cf
Crrent Bsiness. May 1997.
8laheyAeh, Kara L., Empey, Nchoas R., et al., Frevew o lhe
Behchmark lhpulOulpul Accouhls or 2002: Fremhary Eslmales o
Cross Oulpul; Froposed Casscaloh Framework. 8rvey cf Crrent
Bsiness. 8eplember 2005.
8wek, 8lepheh E., Ccpyri~ht |ndstries in the U.8. Lccncmy: The 2006
|epcrt, prepared fcr the |nternaticnal |ntellectal Frcperty Alliance (||FA),
November 2006, avaabe al E22/QTT;;;<66/(<50.
Varah, Ha R., Copyhc ahd Copyrchl. Apr 2004 (Revsed
Mar 29, 2005) avaabe al E22/QTT;;;<86.8<U#4X#)#1<#,&TYE()T
3(/#48T9CC=T50/16%MS(%,S50/146ME2</,G
Varah, Ha R., Joseph Farre, ahd Car 8hapro. The Lccncmics cf
|nfcrmaticn Technclc~y. (New York: Cambrdce Uhversly Fress, 2004).
30
U.8. Cehsus Bureau, Deparlmehl o Commerce. 2002 Lccncmic
Censs, al E22/QTTG(52G6%,#4<5#%8&8<M0$T8#4$)#2TO(2(8#2Z(6%3(MS
#N#4$)#2[V/40M4(.\-LR]V2(UP,\-LR9]V8&U.#%&P,\,(2(8#28V=]V
)(%M\#%]V28\9A9=@A@CAB?@
U.8. Cehsus Bureau, Deparlmehl o Commerce. 2007 Lccncmic
Censs, al E22/QTTG(52G6%,#4<5#%8&8<M0$T8#4$)#2TO(2(8#2Z(6%3(MS
#N#4$)#2[V/40M4(.\-LR]V2(UP,\-LR!]V8&U.#%&P,\,(2(8#28V=]V
)(%M\#%]V28\9A9=@A?!C=>9
U.8. Cehsus Bureau, Deparlmehl o Commerce. 2007 Lccncmic
Censs User Cide 2007. Lasl updaled: March 24, 2009, al
E22/QTT;;;<5#%8&8<M0$T#50%T5#%8&8C@
U.8. Cehsus Bureau, Deparlmehl o Commerce. Annal |etail Trade
8rvey, al E22/QTT;;;<5#%8&8<M0$T4#2(6)
U.8. Cehsus Bureau, Deparlmehl o Commerce. Annal 8rvey cf
Manfactres: Ceneral 8tatistics: 8tatistics fcr |ndstry Crcps and
|ndstries: 2006 and 2005, al E22/QTT;;;<5#%8&8<M0$T.(%&G(52&46%MT
(8.T6%,#7<E2.)
U.8. Cehsus Bureau, Deparlmehl o Commerce. Annal whclesale
Trade 8rvey, al E22/QTT;;;<5#%8&8<M0$T;E0)#8()#T6%,#7<E2.)
U.8. Cehsus Bureau, Deparlmehl o Commerce. Ccnty Bsiness
Fatterns, al E22/QTT;;;<5#%8&8<M0$T#50%T5U/T6%,#7<E2.)
U.8. Cehsus Bureau, Deparlmehl o Commerce. Ncrth American
|ndstry Classificaticn 8ystem (NA|C8), al
E22/QTT;;;<5#%8&8<M0$T#08T;;;T%(658T
U.8. Cehsus Bureau, Deparlmehl o Commerce. 8ervice Annal
8rvey, al E22/QTT;;;<5#%8&8<M0$T8#4$65#8T6%,#7<E2.)
Word lhleeclua Froperly Orcahzaloh, Cide cn 8rveyin~ the
Lccncmic Ccntribticn cf the Ccpyri~ht-Based |ndstries. Ceheva: 2003.
31
Glossary of Fair Use Provisions
17 U.8.C. 102(a) (ncn-ccpyri~htability cf facts)
The acl/expressoh dcholomy s a mlaloh oh lhe scope o copyrchl
lhal rehders acls hohcopyrchlabe. Ths prhcpe mls severey lhe
scope o prolecloh h aclbased works. The resul o 8ecloh 102(a)'s
requremehl o orchaly s lhal raw acls may be coped al w. 8ee
|eist Fbl'ns, |nc. v |ral Tel. 8erv. Cc., 499 U.8. 340, 350 (1991).
17 U.8.C. 102(b) (idea/expressicn dichctcmy)
Arlcualed h Baker v. 8elden, 101 U.8. 99, 10204 (1879) lhe dea/
expressoh dcholomy represehls lhe prhcpe lhal copyrchl may
exlehd lo lhe expressoh o ah dea, bul hol lhe dea lse. 8ecloh 102(b)
expcly wlhhods prolecloh rom ahy dea, procedure, process,
syslem, melhod o operaloh, cohcepl, prhcpe, or dscovery. Ths
prhcpe s lhe source o lhe mercer doclrhe, whch mls copyrchl
wheh lhe humber o possbe varalohs or expresshc ah dea are
exlerhay mled. lh such case, lhe mled possbles o expressoh
merce wlh lhe 'dea' ahd become hohcopyrchlabe.
17 U.8.C. 102(b) (ncn-prctectability cf interface specificaticns)
Ah appcaloh o lhe dea/expressoh dcholomy, lhe hohproleclably
o hlerace speccalohs has beeh eslabshed h a he o U.8.
copyrchl cases, holaby |cts Dev. v. Bcrland |nt'l, 49 F.3d 807 (1995)
ahd Ccmpter Assccs. v. Altai, |nc., 982 F.2d 693 (2d Cr. 1992). These
courls rued lhal hlerace speccalohs are hol copyrchlabe, elher
because lhey are uhproleclabe melhods o operaloh or because
eemehls dclaled by ecehcy or hecessly ose prolecloh uhder lhe
mercer doclrhe.
17 U.8.C. 105 (nc ccpyri~ht in U.8. ~cvernment wcrks)
The Copyrchl Acl prohbls lhe Federa Coverhmehl rom lakhc
copyrchl h lhe works lhal l aulhors. As a resul, a works aulhored
by lhe Federa Coverhmehl empoyees mmedaley ehler lhe pubc
domah ahd become reey avaabe or pubc use.
17 U.8.C. 107 (fair se: criticism, ccmment, news repcrtin~,
teachin~, schclarship, research, etc.)
8ecloh 107 o lhe Copyrchl Acl expcly prolecls lhe ar use o a
copyrchled work or purposes hcudhc bul hol mled lo crlcsm,
commehl, hews reporlhc, leachhc (hcudhc mulpe copes
or cassroom use), schoarshp, or research. 8uch use s hol ah
hrhcemehl o copyrchl.
32
17 U.8.C. 107 (fair se: reverse en~ineerin~)
Uhder lhe ar use doclrhe, a persoh may dsassembe a compuler procram h
order lo cah ah uhderslahdhc o lhe uhprolecled uhcloha eemehls o lhe
procram, where lhere s a eclmale reasoh or dohc so ahd ho olher meahs o
access lo lhe uhprolecled eemehls exsls. 8e~a Lnterprises |td. v. Accclade, |nc.,
977 F.2d 1510 (9lh Cr. 1992); Atari v. Nintendc, 975 F.2d 832 (Fed. Cr. 1992).
17 U.8.C. 107 (fair se: brcwser ccpies)
Uhder lhe ar use doclrhe, oca cache reproduclohs o copyrchled
works by lhe web browsers o hdvdua users are ar use, as lhey
are hohcommerca, lrahsormalve, hecessary or essehla lhlerhel
uhclohs, ahd do hol supersede copyrchl hoders' expolaloh o lher
works. Ferfect 10, |nc. v. Amazcn.ccm, |nc., 487 F.3d 701 (9lh Cr. 2007).
17 U.8.C. 107 (fair se: search en~ine cache ccpies)
Uhder lhe ar use doclrhe, search ehches' reproducloh h lher search
dalabases o maces ahd lexl lhey crawed oh lhe Word Wde Web, ahd
subsequehl dspay o lhese maleras h search resuls, are permlled
because o lher schcahl soca ully. Kelly v. Arriba 8cft, 336 F.3d 811
(9lh Cr. 2003); |ield v. Ccc~le, 412 F. 8upp. 2d 1106 (D. Nev. 2006);
Ferfect 10, |nc. v. Amazcn.ccm, |nc., 487 F.3d 701 (9lh Cr. 2007).
17 U.8.C. 107 (fair se: time and space shiftin~)
Uhder lhe ar use doclrhe, users may ulze lechhoocca devces
lo shl lhe cohlexl h whch lhey vew copyrchled works, .e., lo lape
a procram or aler vewhc oh lhe same or derehl devce. 8uch use
has beeh hed lo be paradcmalc hohcommerca persoha use ehlrey
cohsslehl wlh lhe purposes o lhe Copyrchl Acl. 8ee 8cny Ccrp. cf Am
v. Universal City 8tdics, 464 U.8. 417 (1984); |eccrdin~ |nds. Ass'n cf
Am. v. Diamcnd Mltimedia 8ys., 180 F.3d 1072, 1079 (9lh Cr. 1999).
17 U.8.C. 108 (library ses)
The Copyrchl Acl permls brares ahd archves lo make reproduclohs
or purposes o preservaloh, repacemehl o damaced copes, ahd
hlerbrary oahs.
17 U.8.C. 109(a) (first sale dcctrine)
The Copyrchl Acl permls lhe owher o a awuy made copy lo se or
ehd lhal copy lo olhers.
17 U.8.C. 110(1)110(2) (displays and perfcrmances in
edcaticnal ccntexts)
The Copyrchl Acl permls lhe perormahce ahd dspay o copyrchled works
h lhe course o aceloace leachhc aclvles as we as dslahce educaloh.
33
17 U.8.C. 112 (ephemeral reccrdin~s)
Uhder lhe Copyrchl Acl, a rado slaloh may make ephemera copes
o souhd recordhcs or use h ls owh lrahsmssohs h ls oca servce
area.
17 U.8.C. 114(a) (excepticn tc scnd reccrdin~ perfcrmance ri~ht)
Uhder lhe Copyrchl Acl, lhere s ho perormahce rchl h souhd
recordhcs, excepl or perormahces by dcla audo lrahsmssoh, e.~.,
webcaslhc.
17 U.8.C. 117(a) (backp, essential step ccpies)
The Copyrchl Acl permls lhe owher o a copy o a compuler
procram lo make a copy o lhal procram: as ah essehla slep h
lhe ulzaloh o lhe procram h cohuhcloh wlh a compuler; or or
archva purposes.
17 U.8.C. 117(c) (machine maintenance cr repair)
The Copyrchl Acl permls lhe owher or essee o a compuler, or
purposes o mahlahhc or reparhc lhal compuler, lo make or
aulhorze lhe makhc o a copy o a compuler procram whch s made
soey by vrlue o aclvalhc lhe compuler.
17 U.8.C. 302304 (ccpyri~ht term)
Cohsslehl wlh lhe Cohslluloh's mahdale lhal Cohcress may
provde aulhors wlh excusve rchls or mled lmes, copyrchls
expre aler a slalulory perod ahd ehler lhe pubc domah. Lldred v.
Ashcrcft, 537 U.8. 186 (2003).
17 U.8.C. 512 (service prcvider safe harbcrs)
8ecloh 512 o Tle 17, whch orchaled h lhe Dcla Mehhum
Copyrchl Acl, mls lhe copyrchl remedes avaabe acahsl ohhe
servce provders ehcaced h lhe oowhc aclvles: lrahslory
commuhcalohs, syslem cachhc, slorace o hormaloh oh syslems
or helworks al drecloh o users, ahd hormaloh ocaloh loos.
8cny principle
Uhder 8cny Ccrp. cf Am v. Universal City 8tdics, 464 U.8. 417 (1984),
lhe sae o ah arlce o commerce lhal may be used or bolh hrhchc
ahd hohhrhchc uses w hol ead lo secohdary hrhcemehl lhe
producl s capabe o subslahla hohhrhchc use.
?@@&AB1C&D12991E&FG
D4/19&AA@@
G=8C/-<1,-E&%0&H@@@I
!C,-9J&H@HKBLMK@@B@
)=NJ&H@HKBLMK@OMP
www.CCIANET.org
$Q#$0&'48/-988&09-192
",-7&!,/-1&D+C4.=-&AA
'KA@P@&'24889:8&'9:</4.
!C,-9J&RMHKHKLLLKLPIH
Computer & Communications
Industry Association