There's a lot of misunderstanding of by BX article. Some simplifying things: There are three types of "market failure" in copyright. The first inheres in the nonexhaustibil ity of the good; barring a right to post-dissemination control against copying, goods may be underproduced because potential users will refuse to pay for access, figuring they can get access to a friend's copy later for free or at lower cost than the creator would charoe. Thus. relying only o~ the physical control which lets i creato~ charge for the "first look", will (except where the look wont' make copying possible- the trade secret case) result in underpayments as compared with the extent the thing is really desired. That's the first type of market failure, often called the "public goods" problem. However, unlike a full public good (nonexcludable) excludabil ity is possible for i/p. Giving rights to exclude "cures" the underpayment problem.
Wendy J. Gordon, Notes Re Betamax (1982) (unpublished manuscript).