Page:Hachette Book Group v. Internet Archive (2023).pdf/38

 The fourth fair use factor is “the effect of the [copying] use upon the potential market for or value of the copyrighted work[s].” 17 U.S.C. § 107(4). This factor focuses on whether a secondary use “usurps the market for the [original] by offering a competing substitute.”, 11 F.4th at 48. “When a secondary use competes in the rightsholder’s market as an effective substitute for the original, it impedes the purpose of copyright,” which is “to incentivize new creative works by enabling their creators to profit from them.”, 910 F.3d at 662. The fourth factor necessarily relates to the first and third factors. The less transformative a secondary use is under the first factor, the more “likely it will supplant the commercial market for the original.” So too, the larger the amount of the original that is taken under the third factor, “the greater the likelihood that the secondary work might serve as an effectively competing substitute for the original.”, 804 F.3d at 221.

Like the other three factors, the fourth factor strongly favors the Publishers. “[A] copyright holder is entitled to demand a royalty for licensing others to use its copyrighted work,” and “the impact on potential licensing revenues is a proper subject for consideration in assessing the fourth factor.”