The CC0 Debate Has Just Begun…

Earlier this month, the prominent NFT project Moonbirds announced they would be moving to a Creative Commons Public License. The decision was met with controversy from Moonbirds owners and the broader NFT community.

The CC0 Debate Has Just Begun…

The Moonbirds CC0 Announcement

Earlier this month, the prominent NFT project Moonbirds announced that they would be moving to a Creative Commons Public License, colloquially known as ‘CC0.’ An August 4th tweet thread from Moonbirds founder Kevin Rose made the announcement, saying that “CC0 empowers anyone with the ability to creatively remix work for commercial purposes.” This news was met with controversy, both from Moonbirds owners and the broader NFT community.

Prior to the announcement, Moonbirds owners had the exclusive right to monetize their Moonbird intellectual property (IP) through things like merchandise and other commercial ventures. Moving to CC0 means that Moonbirds is employing a public license, so anyone–including non-owners of Moonbirds–can create commercial ventures using Moonbirds IP. Someone like me, who does not own a Moonbird, can start building a brand or a restaurant or any type of merchandise using Moonbirds characters. Previously, that would be illegal. Many Moonbirds owners expressed their discontent that this decision to move to CC0 was made unilaterally by Kevin Rose and his leadership team.

On one hand, some argue this would decrease the value of Moonbirds because it lowers the financial incentive of people to own Moonbirds, since the exclusive privilege of generating income from your Moonbird will go down. On the other hand, by Moonbirds moving to CC0, you could argue this will increase the overall brand and distribution of Moonbirds as more people around the world have more incentive to work with Moonbirds IP even if they aren’t owners. It will take some time to fully reflect on the implications, and it may be years before we see which side is right.

One reflection of this sentiment is the floor price of Moonbirds, which has been (mainly-ish) going down since the August 4th announcement. However, you can’t isolate the effects of the CC0 decision when there are many other factors.

Precisely because each side of the argument has legitimate points, the decision to go or not go with CC0 has turned into a broader question of how NFTs–and overall Web3–will address issues related to copyright. This topic goes beyond Moonbirds and has implications for how people monetize IP in today’s digital economy.

What is CC0?

CC0 stands for Creative Commons Zero, which basically means something is in the public domain and there are no intellectual property rights reserved by the creator. For example, the works of ancient mythology like Homer’s Iliad and William Shakespeare’s plays would fall under CC0. The Creative Commons public copyright license has many different variations and was first designed in 2001. This pertains specifically to the US legal system but many other countries have adopted similar legal standards.

In a more modern example of creators using CC0, the band Nine Inch Nails released an album called Ghosts I-IV entirely under Creative Commons. Ninch Inch Nails called for people to share, mix, and create new projects based on the music, with lead singer Trent Reznor also saying, “the end result is a wildly varied body of music that we’re able to present to the world in ways the confines of a major record label would never have allowed.”

One of the songs from their album was sampled by a Dutch producer named Kio. That song from Kio was then used by Lil Nas X as the beat for the hit song ‘Old Town Road.’ Because the Ninch Inch Nails song was released under CC0, and Kio created a derivative beat which he then sold to Lil Nas X, the massive success of ‘Old Town Road’ did not include any obligations for Nine Inch Nails to receive any royalties or financial rewards from the song.

The free photo-sharing website Unsplash initially listed all their images under a CC0 license but eventually moved away from CC0. Creative Commons itself described Unsplash’s decision as “they felt that copycat services were detracting from their offering and upsetting users.”

In the world of Web3, some prominent NFT projects and digital artists have embraced CC0 for their work. NounsDAO and MFers are two popular NFT projects that are deliberately CC0 and it hasn’t seemed to have any negative impact on their commercial value or community. Nouns continues to be one of the highest valued NFT projects with several successful spinoff products, and while operating at a much smaller scale, MFers still maintain a relatively strong community. Famous digital artist XCopy recently announced that he will be applying CC0 to all of his existing art, describing in a tweet that “We haven’t really seen a CC0 summer yet, but I believe it’s coming…’

Again, playing out how CC0 is mean to work, I could technically create entire commercial ventures right now with Nouns IP, MFer characters, or XCopy artwork. Even if I don’t actually own any of their NFTs or artwork.

In the decentralized modern internet, the idea of freely allowing people to share, distribute, and remix art sounds very much in line with the world of Web3. This ‘for the people’ ideology is supported by many people in the NFT space outlining the benefits of CC0. A popular argument is that CC0 will allow NFT projects to achieve cultural relevance more rapidly.

VC firm A16Z wrote an article positioning CC0 favorably, citing CC0 as allowing NFT projects to ‘seize the memes of production.’ Their position is that in a world of remix internet culture, the propagation of memes is one of the biggest factors for a project to achieve success. A16Z describes CC0 as helping “jumpstart meme-ability,” allowing people to create derivatives that quickly further brand awareness and cultural relevance. They explain a potential flywheel effect that comes from CC0. Whether it’s people creating derivative meme artwork or Web3 developers jumping on a CC0 NFT project, this idea of supercharging network effects sounds appealing.

Licensing and Alternatives

On the flipside, you can easily make an argument against CC0. Intellectual property was created in order to provide protection to people commercializing their ideas.

If I own Moonbird #356 and other people start making products and brands using my Moonbird, some would argue that this increases the value of my Moonbird. Others would argue that this decreases the value of my Moonbird as the advantages and privileges of ownership have decreased. This could disincentivize me from building a brand with my Moonbird.

Let’s say an extremist political group starts using my Moonbird #356 as their official symbol. Under CC0, they are allowed to do this. Technically, they could do this even without CC0 but I would have more legal protection. What if someone uses my Moonbird #356 as artwork for a scam? While the Moonbirds DAO could condemn this, is that enough to prevent significant brand damage?

As a brand new artist with a tiny following, it’s also unclear why I should be so open to making all of my works CC0. Without financial resources and a large fanbase, I’m leaving myself open to more scammers, thiefs, and imitators. Many of the CC0 NFT examples (Moonbirds, XCopy, MFers) come from founders who already have established brands. There is little financial downside for any of these groups compared to artists or developers at the beginning of their career with much less clout.

Many other NFT projects operate by granting exclusive commercial licenses to NFT owners. Some have limitations – like allowing only certain types of commercialisation, limiting the level of commercialization, etc. – and some are wide open for owners, allowing them to commercialize in any way whatsoever. A good example of this is the prominent NFT project Bored Ape Yacht Club (BAYC) from Yuga Labs. Meaning, if I own Bored Ape #356, I can pretty much create any commercial venture using that IP as the foundation. And we’ve seen this happen with projects like Jenkins the Valet, the BAYC burger restaurant, and the Bored Ape music group. A distributed pool of creative projects have flourished within the Bored Ape Yacht Club community, with financial benefits accruing to both the specific project creators and the broader group of BAYC holders since the brand grows.

A Question of Value

For many people in Web3, the idea of CC0 is very much in line with a philosophical belief. Web3 is supposed to be about decentralizing entities and providing access and ownership for all. At the same time, CC0 is not good for everyone all the time. Like the open-source software movement, there are legitimate situations to go open-source and to not go open-source.

There is enough legitimacy on either side of the argument to mount a compelling case of why your project should or should not be using CC0. On a case-by-case basis, we will see NFT projects harmed and enhanced by CC0. The bigger question that will slowly be answered over time is even more important - where does value exist in the new digital economy?