Copyright Holders Uber Alles?

According to a report posted on CNET yesterday, a German court has ordered the personal computer-making joint venture owned by Siemens (NYSE: SI) and Fujitsu (OTC BB: FJTSY) to pay a levy of 12 euro to the German copyright holders association "VG Wort." Last month, the court found that the JV (aptly named Fujitsu Siemens Computers) was selling computers that could be used for copying copyrighted materials without the payment of mandatory royalties due to the owners of the copyrights in question.

Translated from the original German, the judge is said to have declared, "I'm shocked, shocked to find that copying is going on in here!" (OK, so that's not a direct translation. And I think he was actually speaking in French...)

For Fools old enough to remember "cassette tapes," this was a question that arose in the U.S. back in the dark ages of the 1980s or thereabouts. Because a blank cassette tape can be used to record copyrighted material off of another, non-blank tape, the argument ran, the makers of blank tapes should have to pay copyright holders a "tax" to compensate them in advance for the likely future use of their blank tapes by consumers copying music. I don't recall which way the decision went on the controversy back then, but over in Germany today, the copyright holders seem to have the upper hand, at Fujitsu Siemens Computers' expense.

But the import of this decision doesn't stop with Siemens and Fujitsu. No, once the precedent has been set for taxing these two computer-making lightweights, you can bet your lederhosen that VG Wort will move on to sue the real cash cows for compensation of their hypothetical future harm. It's a sure thing that Dell (Nasdaq: DELL) and Hewlett-Packard (NYSE: HPQ) will face lawsuits on this front in short order. Even tinier competitors, such as Gateway (NYSE: GTW), can expect to find the private taxman knocking.

In the end, of course, it won't be the big corporations that get stuck with this bill. They'll certainly pass it along to their customers eventually -- allowing us all to reap the "benefits" of the free computer software and music stolen by the intellectual property pirates of the world. But what comes around goes around, you know. Even a levy such as this one, which will only increase the price of a PC by a percent or two, will have its incremental effect in decreasing consumer demand for PCs.

For further Foolish musings on the subject of intellectual property rights and wrongs, read:

• Who Leaked "Halo"?
• Piracy Paranoia
• The Death of Dollar Downloads?
• Steal This Column

Fool contributor Rich Smith has no position in any company mentioned in this article.