Copyright is dying, some say. It is too old to run on the Net; it can only grasp feebly at streams of electrons spraying through cyberspace. Copyrights are relics of the crude physical world, best suited to brute things like books, tapes, floppy disks, and CDs.

But new challenges threaten to overload the copyright system. How can we balance efficiently the rights of multimedia developers to sample, alter, and incorporate older works against the rights of copyright owners to be paid whenever their works are used? Who should be responsible when copyrighted works are infringed online - those who create the infringing copies, or the online services which act, often unwittingly, as vehicles for mass distribution? Is copyright law and its copy-based model a sensible way to govern computer networks, where making copies is easy as flicking a light switch, or should creators look to new noncopyright schemes for controlling use of their works, such as the usage-metering schemes now surfacing for CD-ROM and online publishing?

These are all important issues, but another debate is underway: can copyrights be enforced on the Net at all? For traditional physical goods, the factories that produce pirate books, T-shirts, and records don't move around much, making them easy targets for investigators. Once found, the large profits reaped by infringers make a tantalizing prize for copyright owners, fueling lawsuits and even leaving a little over for the owners after paying off the lawyers. There is also a natural cap on the universe of infringing activities in the physical world. The hefty start-up investment needed for copying equipment and setting up distribution channels limits big-time bootlegging to a few rich players. Pursuing these mass infringers is the copyright owners' version of one-stop shopping: you can collect legal damages for many small rip-offs by suing just one mass infringer. The small-time infringers are all but ignored.

In contrast, on the Net, you don't need heavy equipment to infringe. Any college kid with a tuition-paid account can readily copy any digital work and send it to thousands of places online for no fee. Add to this the recently developed Net service known as the "anonymous remailer," and no one will be able to identify that kid as the wrongdoer. For instance, I can scan this issue of Wired into digitized form, zip it up, and pump it out anonymously to thousands of newsgroups and bulletin boards. No one will ever track me down. If others do the same, why would anyone want to pay for Wired, or anything else we can digitize? The field of potential infringers, once limited to a few well-heeled players, has broadened to everyone with access to computer networks and services - as many as 25 to 50 million Net users worldwide at the moment. The new ease of infringement and difficulty of enforcement bring us inexorably to the conclusion that copyright is dead.

This is a seductive view among those captivated by the idea that "information wants to be free." But it is wrong. Businesses built on copyrighted products - record companies, book publishers, film producers, and the like - never depended on stopping all infringements. On city sidewalks and in country flea markets across the nation, you will find truckloads of bootleg music tapes, videos, and software, as well as knockoff T-shirts and watches. Infringements galore! Visit some foreign countries, especially in Asia, and you will find whole economies based on ripping off US software. Surging trade in knockoffs and bootlegs is a fact of life for the music, film, publishing, computer, and other copyright-based industries.

The Net did not introduce low-cost, anonymous infringement to the world. Anyone can buy a photocopier, tape deck, or computer and become a small-time infringer who's almost impossible to detect. Yet many companies in hard-copy industries enjoy year after year of record profits. Look at shareware companies, which are based on the idea of rampant, out-of-control copying of their products. They are making thousands, millions, in market niches where even the most wildly optimistic observers estimate no more than 5 percent of the people who use shareware pay for it.

How do these companies stay in business? It's simple: copyright law succeeds at maintaining public markets for copyrighted products - markets where the owners can charge and receive a price for those products. It is irrelevant whether any given infringement goes unpunished - as long as it is kept outside the public marketplace. This is easy. Cops have plenty of experience in sweeping the public markets clean enough for business. Now they are walking the beat regularly in the online public markets: online services, bulletin boards, and the Internet.

For instance, the Software Publishers Association reportedly has about 2,000 computer bulletin boards under continuing surveillance, while the FBI readily lurks anywhere it suspects wrongdoing. These groups, as well as large copyright-owning corporations, bust notorious online services every now and then, and wave their fists at lots of others (major fist wavers include LucasArts, Lotus, Novell, Playboy, Paramount, Walt Disney, and Walt Disney). Playboy recently won a court order against the Georgia bulletin board Tech's Warehouse for trafficking in digital images of its magazine pinups; Sega, of video-cartridge fame, obtained a well-publicized shutdown of the Maphia pirate BBS in California. Not content with such small fry, the Harry Fox Agency in New York (a major music-rights licensing group) is suing CompuServe for millions of dollars because CompuServe's users were supposedly using the online service to trade large quantities of infringing songs. These legal tactics and others will keep online systems scared straight. They will discourage organized copyright infringement on their systems, especially infringements out in the open.

The anti-infringement drumbeat is pounding ever more loudly. Criminal indictments were recently charged against system operator David LaMacchia of MIT and the Davey Jones Locker bulletin board. Other criminal actions are pending: against Rusty and Edie's bulletin board in Ohio, and a group of five bulletin boards recently raided in Texas. Such legal scare tactics assure that online systems who are more interested in business than playing cops and robbers will discourage organized copyright infringement on their systems, especially infringements out in the open.

OK, so the public thoroughfares can be kept honest, but won't criminals and pirates continue to operate elsewhere? Sure, but only if they stay deep under-ground, where they won't interfere with public markets where the copyright owners make their profits. If a pirate operation drifts close enough to the surface that it threatens legitimate markets, the Net cops will infiltrate and bust it before it can make a dent in the copyright owner's profits, regardless of whether the pirates are using encryption to cloak their identities. Net users who aren't at least mildly familiar with the underworld will never even hear about such systems before they are dismembered, and will confine their purchasing to the legitimate above-ground markets for copyrighted goods.

The Software Publishers Association and Business Software Alliance maintain the distance between public and pirate markets. Despite their constant public relations bombast about billions of dollars in sales lost to software piracy, these vigilante groups know they have zero chance of capturing those would-be revenues. Their real job is patrolling the border territory between mainstream software markets and pirate lands, gunning down anyone foolish enough to breach the neutral zone. Don't ever expect the Software Publishers Association and Business Software Alliance to admit to their lowly border guard status, however. Their fangs are bared at all times, hissing, "don't copy that floppy." As markets for all sorts of digital industries other than software move online, we are seeing the organizations for those industries move in to perform functions similar to the SPA, including BMI for musical performance rights and the Writers Union for copyrights in both newspaper and magazine articles.

Fine, so the black markets can be kept deep underground. But who needs black markets? Can't we all use anonymous remailers to keep the Net knee-deep in infringing copies? Nope. Net cops can swiftly clean each new infringement out of the major online markets as soon as it appears. They will soon become better at it when copyright owners begin deploying software agents that can roam the entire Net, searching out anonymous infringements. Every time a pirated work is spread to the four corners of the Internet by an anonymous user, software agents will quickly sniff it out. Anonymous infringements will arc across the Net like shooting stars, and disappear from sight just as quickly. Those who want the latest freebie will have to scramble for it before the cops and their software agents go out to sweep up the mess.

One of the limits on enforcing copyright on the Net is the ease of setting up private, informal exchanges of works between friends. Not black markets exactly, but "friend-to-friend markets." If one of my friends has a video, song, book, or piece of software that I want, I can easily get it privately through the Net, and the cops won't be any the wiser. There will be no stopping these personal exchanges online, just as home taping could not be stopped. Indeed, just last year, Congress threw in the towel on physical taping and added a provision to the Copyright Act making it legal for us to make noncommercial music tapes for our friends.

Can the Net be leveraged to extend friend-to-friend exchanges to include far larger groups of people? Can we all get the works we want cheaply or for free among private, interlocking circles of friends? This is a tempting thought, but friend-to-friend markets are far more likely to remain small and self-limiting. We might refer to an extended circle of trading acquaintances as "friends," but in fact few or none of the participants will know everyone else in the circle. This makes such groups ripe for infiltration by the cops, who will do so readily if enough freebies pass within these expanded groups that they noticeably reduce sales in the legitimate markets. A symbolic legal attack every now and then will keep these groups in check, using the recently increased criminal provisions of the Copyright Act to send digital traders to jail for the felony of possessing 10 or more illicitly made copies of copyrighted works worth a total of US$2,500 or more.

Yet another prediction for the Net is that online media are moving toward "narrowcasting" - targeting smaller and smaller audiences with highly defined preferences. Examples today would include high-priced industry newsletters for company executives, with circulations measured in the hundreds or low thousands, and prices of several hundred dollars per year for a subscription; and industry and demographic studies that may sell a few dozen copies or less, but at a price of thousands of dollars for each copy. The audiences for these media products may be small enough, and their members familiar enough with each other, that they may be able to defeat enforcement of narrowcasted content copyrights by trading through friend-to-friend networks that never become extended enough for easy infiltration by the cops. This prospect is real, but largely irrelevant for such media products. Copyright law is aimed primarily at protecting mass-market works, not high-priced, small-circulation specialty products. The small size of the audience that makes copyright enforcement difficult also springs loose other legal protections, such as distributing the narrowcasted materials under confidentiality restrictions and strong copy protection. These mechanisms don't work in mass-market environments like Blockbuster and Kmart, but they are routinely used and accepted among those who use small-market, specialized products.

Another way to understand the relationship between legal copyright markets and illegal markets such as black markets and friend-to-friend markets is to consider the question: What is the consumer's true cost of obtaining digital works? Say I'm looking for the latest Madonna single in digitized form; it costs a few dollars at an authorized store, but in an illicit market I could get it for a buck, or even for free. In this scenario, doesn't online piracy knock the legs out under copyright-based marketing after all?

Not at all, when we consider what you or I may have to go through to get a copy. To get the illicit version, you need to find someone who has it, which means keeping up with the whereabouts of those who collect the kinds of music you like. It's not easy to stay informed about these people. Anyone making an array of digital works available for infringement by large groups of people will be easily found and quickly busted by the Net cops. The survivors will be those deep enough underground that the cops can't readily find them, moving as necessary from dark corner to dark corner. Keeping track of these shady characters will require becoming part of an underground information network yourself, and maintaining strong enough security to keep out the copyright narcs.

Now we can compare the true costs of the above-ground Madonna single to the pirated version. The official Madonna single still costs a few bucks. The pirated version's cost is: (1) a buck or for free, plus (2) all the time and effort needed to track down pirate dealers with the stuff you want (and who are so deep underground even the cops can't find them), plus (3) more time and effort on security procedures for dealing with pirates and avoiding detection, plus (4) the legal risks of being involved in clandestine criminal activities. Given this choice, consumers who just want the Madonna single will flock to the stores with large and organized inventories, pay a few bucks, and conduct their business relaxed and in the light of day. The adventure and risk of hunting down pirate suppliers and avoiding the cops will be left to cyberpunk romantics and belligerent information-freedom fighters for whom the game of getting the goods illicitly is the object anyway. Make no mistake, though. Those playing cops and robbers are paying for their entertainment.

So copyright law will continue in its traditional role of promoting markets for copyrighted goods on the Net, as it does in the tangible world. This does not mean, though, that the market will be unchanged. There is a vast movement afoot - the great and rapidly increasing abundance of information on the Net, far more than we can ever use - which may ultimately reduce our tendency to hoard information under the copyright laws. Information loses its value when there is so much we can't pick apart the useful data from the chaff. The valuable online services of the future will be those that bring order out of the chaos.

In some cases, the creators of valuable organizing tools will be able to control them under copyright, and their owners will profit. In many other cases, though, we will see a shift toward information services instead of information hoarding. For instance, it would not be surprising if much of what is sold today as "products" - recorded songs, books, films - become no more than cheap promotional tools for premium services, such as live online concerts and direct interactions between audiences and artists. Such new services and more will undoubtedly appear as we venture deeper online. In any event, the shift from information hoarding to infomation services will be based entirely on our increasingly desperate need to organize overabundant information resources. Killing off copyright law has nothing to do with it.

Each of us can now perform widespread copyright infringement without getting caught, if we're careful. However, none of this will make a hair's breadth of difference to most of those who wish to sell copyrighted goods in the electronic age because the traditional copyright system is fully Net-capable. We may eventually see a societal move away from information hoarding, but it will not happen because copyright law does not work. There will simply be more money in helping people use information than in metering the stuff out.