be less severe. As most tourists know, it is quite easy to exclude those who are unwilling to pay the entrance fee to climb to the top of a light-house. While free riders can still view the lighthouse from afar, only those who pay can experience what it is like to look out over the sea from the lonely vantage point of the lighthouse keeper. Moreover, while light-houses are great fun, tourists enjoy a competitive market seeking their holiday dollar. Ironically, in this new function, the lighthouse is no longer in need of governmental aid to make it a viable enterprise.

ABSTRACT

S A L E CONSTITUTE FAIR USE? A N ECONOMIC ANALYSIS OF

T H E SONY BETAMAX A N D WILLIAMS A WILKINS CASES

J O H N C I R A C E *

During the last decade, the Supreme Court has had difficulty deciding the two leading cases involving copyright fair use.1 Moreover, the economic analysis in this article demonstrates that both cases were decided incorrectly by the appellate courts. In the much publicized Universal City Studios v. Sony Corp. of America (Betamax) case,2

producers of televised feature films claimed that home video recording of their copyrighted works3 constitutes copyright infringement and that manufacturers of such recording equipment are guilty of contributory infringement.4 The manufacturer-defendants contended that home

* Visiting Professor of Law, Hamline University Law School. B.A. 1962, Harvard University; J.D. 1967, Stanford University; Ph.D. 1975, Columbia University.