I'm not sure I understand the article referenced. On one hand Deutsch appears to think protection against copying is not necessary for innovation. On the other had he does appear to do so when he writes:

I am not suggesting that software companies shouldn't fight piracy - it is this very fight that spurs much of the innovation I've been advocating - I only ask that they fight fair.

And here Deutsch misses the point completely:

Similarly, affluent 'adults' will not pirate because they have neither the time nor the inclination to trawl the dark recesses of the Internet looking for seedy pirate web sites when they can more easily walk into a shop.

This is an attempt to have your cake and eat it too. The reason affluent adults will not pirate is because there is copyright law. Now does Deutsch advocate making copying legal or not? If yes, then software makers will no longer be able to sell their software at a premium. Because legal copies will be sold by others with the same quality and they will no longer be sold at seedy pirate web sites. If no, then Deutsch must accept that action is taken against copyright infringers, whether they be young girls or grown men. Whether this is a function of the state or private initiative is a different debate.

I believe copyright arrises via freedom of contract. Just as when you order dinner at a restaurant, you implicitly agree to pay for it afterwards, so too when you buy anything with the label "copyright" you implicitly agree not to copy it or let someone else copy it (except for backup purposes). If everybody abides by their contract, we have de facto copyright.

The problem is some people will not abide by their contract. Or someone who has not been bound by the contract may find or steel or borrow software and make a copy. But a copyright contract means that the buyer gains only certain limited rights with regard to a property. A copyrighted book remains in one sense physical property of the seller. The buyer buys only the right to read the book and do some other things with it (similar for software). All other rights with regard to the physical property, including the right to copy, remain with the seller. And therefore the finder of say a software DVD on the street does not have the right to read that DVD on his computer and make a copy. Even though he does not have a contract with the original owner, he is not the rightful owner of the DVD. Nor can he be given full ownership rights by the previous owner, because that owner cannot give away rights he does not have, and the right to copy remains with the original seller. And so via purely physical property rights, an immaterial copyright can be derived.

Compare this to renting a house. If I rent a house a condition may be that I am not allowed to allow anybody to smoke in the house. If I sublet the house to someone else, that third person can never gain the right to smoke in the house, even though he signed no contract to that effect himself. I can never give or sell a right with regard to a property which I do not have. Therefore I cannot give or sell the right for someone to smoke in the house. And similarly, I can never give or sell someone the right to copy a DVD which I "bought" ("rented" would be more accurate) if I do not have full property rights to that DVD myself (and in particular do not own the right to copy it).

One might argue that if I pay for downloaded software, I download that software to my own physical harddisk. In that case I can no longer argue, it appears, that part of my harddisk remains physical property of the seller and that he keeps the right to use it to make copies. Well, one could in fact argue exactly that. Part of the contract could be that the seller gains some physical ownership over the part of my harddisk where I store the copy. Now my point is not that such a contract should really be made. My point is that we can always find some way for a copyright contract to be phrased so that copyright arrises out of purely physical property rights. And the very fact that that is possible makes copyrights reasonable, whether or not people actually take the trouble to phrase it in such ways.

Henry Sturman