Research and commentary on digital technologies in public life
Hi, all. I’m back from a lovely vacation, which included a stint camping in Sequoia / King’s Canyon National Park, beyond the reach of Internet technology. In transit, I walked right by Jack Valenti in the LA airport. He looked as healthy as ever, and more relaxed than in his MPAA days.
Blogging will resume tomorrow, once I’ve dug out sufficiently from the backlog. In the meantime, I recommend reading Kim Weatherall’s summary of the Australian judge’s decision in the Kazaa case.
Fred von Lohmann’s paper argues that the DMCA has failed to keep infringing copies of copyrighted works from reaching the masses. Fred argues that the DMCA has not prevented “protected” files from being ripped, and that once those files are ripped they appear on the darknet where they are available to everyone. I think Fred is right that the DMCA and the DRM (anti-copying) technologies it supports have failed utterly to keep material off the darknet.
Over at the Picker MobBlog, several people have suggested an alternate rationale for the DMCA: that it might help raise the cost and difficulty of using the darknet. The argument is that even if the DMCA doesn’t help keep content from reaching the darknet, it may help stop material on the darknet from reaching end users.
I don’t think this rationale works. Certainly, copyright owners using lawsuits and technical attacks in an attempt to disrupt the darknet. They have sued many end users and a few makers of technologies used for darknet filesharing. They have launched technical attacks including monitoring, spoofing, and perhaps even limited denial of service attacks. The disruption campaign is having a nonzero effect. But as far as I can tell, the DMCA plays no role in this campaign and does nothing to bolster it.
Why? Because nobody on the darknet is violating the DMCA. Files arrive on the darknet having already been stripped of any technical protection measures (TPMs, in the DMCA lingo). TPMs just aren’t present on the darknet. And you can’t circumvent a TPM that isn’t there.
To be sure, many darknet users break the law, and some makers of darknet technologies apparently break the law too. But they don’t break the DMCA; and indeed the legal attacks on the darknet have all been based on old-fashioned direct copyright infringement by end users, and contributory or vicarious infringement by technology makers. Even if there were no DMCA, the same legal and technical arms race would be going on, with the same results.
Though it has little if anything to do with the DMCA, the darknet technology arms race is an interesting topic in itself. In fact, I’m currently writing a paper about it, with my students Alex Halderman and Harlan Yu.
Most independent analysts agree that the entertainment industry didn’t get what it wanted from the Supreme Court’s Grokster ruling. Things look grim for the Grokster defendants themselves; but what the industry really wanted from the Court was a ruling that a communication technologies that are widely used to infringe should not be allowed to exist, regardless of the behavior and intentions of the technologies’ creators. The Court rejected this theory.
Last week the Senate Commerce Committee held a hearing (a video stream is available) on the Grokster aftermath. This was a chance for witnesses representing various interests to put their official spin on the Grokster ruling. All of the witnesses praised the ruling and asked Congress to wait and see what develops, rather than legislating right away. But different witnesses put different spins on the ruling.
The entertainment industry line was presented by Mitch Bainwol of the RIAA, Fritz Attaway of the MPAA, and Gregory Kerber of Wurld Media (a music distribution service). Their strategy was essentially to pretend that the Court did give the industry what it wanted, and that P2P technologies were now presumptively illegal unless they had cut licensing deals with the industry. They didn’t argue this directly, but the message was clear. For example, they tried to draw a line between “legitimate” P2P technologies and others, where legitimacy was apparently achieved by signing a licensing deal with major recording or movie companies.
For example, in response to concerns from Mark Heesen of the National Venture Capital Association about venture capitalists’ fears of financial ruin from investing in even well-intentioned communication technology companies, Mr. Kerber said this:
It’s very clear how you get investment. The rules are there. We’re a P2P – we’re a real peer-to-peer – it’s centrally controlled, we can control that … we can respect the copyright holder’s wants during – through a contractual process.
And the way that investors realize that is when we go out and get deals with the record labels, movie studios; and … the venture capitalists do their due diligence, they call and they find out that … the content owner of these assets [says] yes, we will allow this to be transferred and distributed and sold … within – on the network.
So … it’s very, very clear. If you have a contract with a major label, indy label, movie studio, publisher, what they have said is, we will allow the content to be sold in this manner across our network. So I’m a little confused by – there’s an absolute clear path for an investor to understand what’s right and wrong in the process.
It’s a simple message. Investing in technologies that have been blessed by the entertainment industry: right; investing in other technologies: wrong.
But it’s not what the Court said. The Court rejected the proposition that P2P or other communication technologies can exist only at the pleasure of the entertainment industry.
Despite this, we can expect to hear more of this rhetoric of “legitimacy”. And when P2P technologies continue to exist and be popular, we can expect calls for legislation to control the scourge of “illegitimacy”.
The RIAA has fired a shot across the bow of P2P companies whose products incorporate anti-spoofing technologies, according to a story (subscribers only) in Friday’s National Journal Tech Daily, by Sarah Lai Stirland. The statement came at a Washington panel on the implications of the Grokster decision.
“There’s definitely a lot of spoofing going on on the networks, and nobody thinks that that’s not fair game,” said Cary Sherman, president of the Recording Industry Association of America, on Friday. “Some networks actually put out some anti-spoofing filters to enable people to get around the spoofs, and that may well be a sign of intent.”
…
The comment came in answer to a question about the kinds of lawsuits that might be brought in the wake of the high court’s decision.
What Sherman is suggesting is that if a P2P vendor includes anti-spoofing technology in their product, that action demonstrates an intent to facilitate infringement, making the vendor liable as an indirect infringer under Grokster.
Perhaps Sherman is asserting that anti-spoofing technologies lack substantial noninfringing uses, and so do not qualify for the Sony Betamax safe harbor. This is wrong in general. It’s well known that some of the files on P2P systems are of low audio or video quality, or are mislabelled altogether. This is true of both infringing and non-infringing files. A technology that can predict which files will have low quality, or which users will be sources of low quality files, will help users find what they want. Spoof files are just low quality files that are inserted deliberately, so technologies that reject low-quality files will tend to reject spoof files, and vice versa.
Of course some particular vendor might introduce such a filter for bad reasons, because they want to abet infringement. But one cannot infer such intent merely from the presence of the filter.
One popular interpretation of Grokster is that the Court said a company’s overall business practices, rather than its technology, will determine its liability. That seems to follow from the Court’s refusal to revise the Sony Betamax rule. And yet Sherman’s complaint here is all about technology choices. Is this the precursor to lawsuits against undesired technologies?
Richard Posner and Gary Becker turn their bloggic attention to the Grokster decision this week. Posner returns to the argument of his Aimster opinion. Becker is more cautious.
After reiterating the economic arguments for and against indirect liability, Posner concludes:
There is a possible middle way that should be considered, and that is to provide a safe harbor to potential contributory infringers who take all reasonable (cost-justified) measures to prevent the use of their product or service by infringers. The measures might be joint with the copyright owners. For example, copyright owners who wanted to be able to sue for contributory infringement might be required, as a condition of being permitted to sue, to place a nonremovable electronic tag on their CDs that a computer would read, identifying the CD or a file downloaded from it as containing copyrighted material. Software producers would be excused from liability for contributory infringement if they designed their software to prevent the copying of a tagged file. This seems a preferable approach to using the judicial system to make a case by case assessment of whether to impose liability for contributory infringement on Grokster-like enterprises.
It’s fascinating that Judge Posner, with his vast knowledge about the law and about economics, avoids a case-by-case law and economics approach and looks instead for a technical deus ex machina. Unfortunately, his knowledge of technology is shakier, and he endorses a technical approach that is already discredited. Nobody knows how to create the indelible marks he asks for, and in any case the system he suggests is easily defeated by encrypting or compressing the content – not to mention the problems with malicious placement of marks. In short, this approach is a non-starter.
Becker is right on the mark here:
But several things concern me about the issues raised by this and related court decisions. I basically do not trust the ability of judges, even those with the best of intentions and competence, to decide the economic future of an industry. Do we really want the courts determining when the fraction of the total value due to legal sales is high enough to exonerate manufacturers from contributory infringement? Neither the wisest courts nor wisest economists have enough knowledge to make that decision in a way that is likely to produce more benefits than harm. Does the fraction of legitimate value have to be higher than 50 per cent, 75 per cent, 10 per cent, or some other number? Courts should consider past trends in these percentages because new uses for say a software-legal or illegal- inevitably emerge over time as users become more familiar with its potential. Must courts have to speculate about future uses of software or other products, speculation likely to be dominated by dreams and hopes rather than firm knowledge?
One of the tenets of the law and economics movement is that decisions about legal regulation of economic behavior should be grounded in a deep understanding of economics. Sound economics can predict the effect of proposed legal rules; but bad economics leads to bad law. As luminaries of the law and economics movement, Posner and Becker understand this as well as anyone.
What is true of economics is equally true of computer science. Only by understanding computer science can we predict the impact of proposed regulations of technology. As we have seen so many times, bad computer science leads to bad law. Posner seems to miss this, but Becker’s stance shows appropriate caution.
One criticism of law and economics is that it works well in a seminar room but may lead to dangerous overconfidence if applied to a hard case by an overworked, generalist judge. One solution is to teach judges more economics, and economic seminars for judges have proliferated. Perhaps the time has come to run seminars in computer science for judges.
