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Panel on Ministry of Sound Added at Copyright and Technology London 2013 October 10, 2013

Posted by Bill Rosenblatt in Events, Law, UK, Uncategorized.
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We have added another panel session to the Copyright and Technology London 2013 conference, which will take place next Thursday (17 October).  The most important recent copyright litigation in the UK at the moment is the case of Ministry of Sound v. Spotify, in which the record label is objecting to Spotify making playlists available that mimic the compilation albums for which the label is best known.  The case has broad implications for the limits of copyrightability in the digital age, at least under UK law.

Here is the panel description:

The Limits of Copyright in the Digital Age

The litigation that Ministry of Sound recently started against Spotify will test whether playlists on compilation albums have copyright protection.  It will be played out in the context of the debate about to what extent we as a society are prepared to pay for curation. The same issue faces news-disseminating organisations over their headlines and sports reporters over game highlights. Does our society value the editorial/quality control/validation role that they play? This panel will explore the boundaries of what is – and should be – protected by copyright in the digital age and suggest what directions legal decisions in the future may take.

Although the case was only filed a month ago, we have been able to pull together an excellent group of authorities on both the legal and content aspects of the matter, thanks to the tireless efforts of Serena Tierney of Bircham Dyson Bell, the panel chair and herself an authority on copyright in the digital age.  Panelists will include:

  • Jeff Smith, Head of Music at BBC Radio 2 and 6; former Director of Music Programming at Napster
  • Mo McRoberts, Head of the BBC Genome Project at the BBC Archive
  • Lindsay Lane, Barrister at 8 New Square Intellectual Property and co-author of the standard copyright treatise Laddie, Prescott and Vitoria on The Modern Law of Copyright and Designs
  • Andrew Orlowski, Executive Editor of The Register, who has covered this case.

This means that we will have a packed day of exciting sessions from all around the world of copyright.  Places are still left, so register today!

Copyright and Accessibility June 19, 2013

Posted by Bill Rosenblatt in Events, Law, Publishing, Standards, Uncategorized.
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Last week I received an education in the world of publishing for print-disabled people, including the blind and dyslexic.  I was in Copenhagen to speak at Future Publishing and Accessibility, a conference produced by Nota, an organization within the Danish Ministry of Culture that provides materials for the print-disabled, and the DAISY Consortium, the promoter of global standards for talking books.  The conference brought together speakers from the accessibility and mainstream publishing fields.

Before the conference, I had been wondering what the attitude of the accessibility community would be towards copyright.  Would they view it as a restrictive construct that limits the spread of accessible information, allowing it to remain in the hands of publishers that put profit first?

As it turns out, the answer is no.  The accessibility community, generally speaking, has a balanced view of copyright that reflects the growing importance of the print disabled to publishers as a business matter.

Digital publishing technology might be a convenience for normally sighted people, but for the print disabled, it’s a huge revelation.  The same e-publishing standards that promote ease of production, distribution, and interoperability for mainstream consumers make it possible to automate and thus drastically lower the cost and time to produce content in Braille, large print, or spoken-word formats.

Once you understand this, it makes perfect sense that the IDPF (promoter of the EPUB standards for e-books) and DAISY Consortium share several key members.  It was also pointed out at the conference that the print disabled constitute an audience that expands the market for publishers by roughly 10%.  All this adds up to a market for accessible content that’s just too big to ignore.

As a result, the interests of the publishing industry and the accessibility community are aligning.  Accessibility experts respect copyright because it helps preserve incentives for publishers to convert their products into versions for the print disabled.  Although more and more accessibility conversion processes can be automated, manual effort is still necessary — particularly for complex works such as textbooks and scientific materials.

Publishers, for their part, view making content accessible to the print disabled as part of the value that they can add to content — value that still can’t exist without financial support and investment.

One example is Elsevier, the world’s largest scientific publisher.  Elsevier has undertaken a broad, ambitious program to optimize its ability to produce versions of its titles for the print disabled.  One speaker from the accessibility community called the program “the gold standard” for digital publishing.  Not bad for a company that some in the academic community refer to as the Evil Empire.

This is not by any means to suggest that publishers and the accessibility community coexist in perfect harmony.  There is still a long way to go to reach the state articulated at the conference by George Kerscher, who is both Secretary General of DAISY and President of IDPF: to make all materials available to the print disabled at the same time, and for the same price, as mainstream content.

The Future Publishing and Accessibility conference was timed to take place just before negotiations begin over a proposed WIPO treaty that would facilitate the production of accessible materials and distribution of them across borders.  The negotiations are taking place this and next week in Marrakech, Morocco.  This proposed treaty is already laden with concerns from the copyright industries that its provisions will create opportunities for abuse, and reciprocal concerns from the open Internet camp that the treaty will be overburdened with restrictions designed to limit such abuse.  But as I found out in Denmark last week, there is enough practical common ground to hope that accessibility of content for the print disabled will continue to improve.

Copyright and Technology London 2013 Conference: October 17 June 19, 2013

Posted by Bill Rosenblatt in Uncategorized.
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I’m pleased to announce that our next Copyright and Technology conference will take place in London on Thursday, October 17.  The one-day event, produced by Music Ally, will take place at the offices of ReedSmith, near Liverpool Street railway station.

Here is the draft conference agenda, which is subject to change.  At this point, we are seeking moderators, speakers, and sponsors.  Deadline for speaking submissions is Friday, July 12, and as usual, proposals to moderate panels will be given priority.  We are also seeking sponsors; a brochure is available on request.  Our initial sponsors include MarkMonitor, ReedSmith, and Civolution.

As with our past events, the agenda will feature a morning plenary session with opening remarks by me, a keynote address, the Conference Sponsor session, and a plenary panel designed to appeal to a wide variety of attendees.  Then in the afternoon, we will split up into two parallel tracks: Law and Policy, and Technology.

Here are the panels for which we are seeking moderators and speakers.

Plenary Session

  • The Global Repertoire Database
    The Global Repertoire Database (GRD) was initiated in 2008 by EU Commissioner Neelie Kroes as “a single, comprehensive and authoritative representation of the global ownership and control of musical works.”  After five years, this landmark initiative is getting set to launch.  Our panel will include representatives from the GRD initiative who will discuss its status, implications for long-sought efficiencies and clarity in online licensing of music, and ways in which the entire online music community can benefit through involvement.

Law and Policy Track

  • Digital Copyright Exhaustion and Resale
    The doctrine of exhaustion states that once you obtain a copyrighted work legally, it’s yours to do with as you please, without any further control from the publisher.  This law applies to books, CDs, DVDs, and so on.  But does it apply to downloaded bits?  As more and more content is consumed as digital files, this question becomes more important.  This panel will examine legal precedents, such as the EU Court of Justice’s decision last year on downloaded software.  We will also discuss the potential for innovative business models for reselling digital files.
  • Graduated Response
    As France has learned from its experience with Hadopi, graduated response regimes come with benefits as well as risks.  Some countries (such as the United States) are starting their own graduated response systems while others (such as the Netherlands) have rejected the approach.  We’ll discuss the pros, cons, and lessons learned so far.
  • Brand Advertising on Pirate Sites
    Websites that exist primarily to offer illegal content downloads show advertising from well-known consumer brands.  Some consumer brand companies are taking steps to prevent their ads from appearing on these sites, while others claim that their ad networks give them no control.  This panel will discuss steps the Internet ad industry can take to enable companies to avoid having their ads appear on pirate content sites, whether it’s best practices, automated mechanisms, or legal mandates.

Technology Track

  • Automated Content Recognition and Second Screen Applications
    Second screen applications are hot.  Watch TV, fire up your tablet or smartphone, and an application will figure out which show you’re watching and enhance your viewing experience.  Automated content recognition (ACR), also known as content identification, is the secret sauce that makes it happen.  What rights do third-party apps have to use content from television programs?  As the popularity of second-screen apps grows, so do these legal and technical issues, which we’ll discuss on this panel.
  • Cyberlockers and Large-Scale Piracy
    The halcyon days of cyberlockers — online services for storing files — are over regarding copyright liability.  After the shutdown of Megaupload, Kim Dotcom recently launched Mega, a cyberlocker service that encrypts users’ files.  RapidShare implemented a series of technical measures to curtail large-scale infringing activities.   What are the merits of these techniques, and how effective are they likely to be in both curbing infringement and avoiding liability for operators?  Are we approaching a set of voluntary best practices for curbing infringement, or is further legal action warranted?  We’ll get into the meat of these issues in this session.
  • Content Protection for Over-the-Top Video Services
    Many traditional Pay TV operators are launching “Over-the-Top” (OTT) Internet video services with premium content licensed from Hollywood studios, TV networks, and sports leagues in order to keep up with competition.  As the number of delivery modalities increases, so does the complexity of protecting the contentb.  Operators must integrate content protection technologies for unmanaged networks and consumer devices with their existing pay-TV infrastructures.  On this panel, we will demystify this often bewildering technical area and discuss solutions.

Once again, the deadline for moderating and speaking proposals is Friday July 12.  Please email your proposal(s) with the following information:

  • Speaker’s name and full contact information
  • Panel requested
  • Moderator or speaker request?
  • Description of speaker’s experience or point of view on the panel subject
  • Brief narrative bio of speaker
  • Contact info of representative, if different from speaker*

As mentioned above, the agenda is subject to change.  If you have another idea for a panel, we’d love to hear about that as well.

Sponsorship opportunities that come with varying degrees of publicity and exposure are available.  Please ask and we will send you a brochure describing the sponsorship levels and benefits.  Thanks in advance for your interest!

*Please note that personal confirmation from speakers themselves is required before we will put them on the program.

Yes, Piracy Does Cause Economic Harm January 27, 2013

Posted by Bill Rosenblatt in Economics, Uncategorized.

Back in 2010, the Government Accountability Office (GAO) published a meta-study of the economic effects of intellectual property infringement (including counterfeit goods as well as copyrighted works).  The GAO concluded that IP infringement is a problem for the economy, but it’s not possible to quantify the extent of the damage — and may never be.  It looked at many existing studies and found bias or methodological problems in every one.

More recently, Michael Smith and Rahul Telang, two professors at Carnegie-Mellon University, published another meta-study that serves as a sort of rejoinder to the GAO study.  This was the subject of Prof. Smith’s talk at the recent Digital Book World (DBW) conference in NYC.

Assessing the Academic Literature Regarding the Impact of Media Piracy on Sales summarizes what has been a growing body of studies on the economic effects of so-called media piracy.  Their conclusion is that piracy does have a negative effect on revenue — if for no other reason than the vast majority of studies come to that conclusion.

Smith’s presentation at DBW listed no less than 29 studies on media piracy that take actual data into account (as opposed to merely theoretical papers such as this one).  Of those, 25 found economic harm from piracy, while 4 didn’t.  When the list is restricted to papers published in peer-reviewed academic journals, the ratio is similar: 12 found harm; 2 didn’t.  Interestingly, almost half of the cited studies were published after the GAO’s 2010 report.

(When Smith and Telang’s paper was originally published last year, many discredited it instantly because the MPAA helped fund the research.  Yet I take the researchers at their word when they say that the funding source had no effect on the outcomes — an assertion bolstered by the paper’s exclusion of the MPAA’s own study from 2006.)

The paper explains why some studies’ methodologies are better than others and discusses shortcomings in some of the studies, such as the Oberholzer-Gee & Strumpf paper from 2007 that showed no harm to sales of music from piracy and therefore has been widely cited among the copyleft.

It’s easy to poke holes in the methodologies of studies that have to rely on real-world data over which the researchers have little or no control.  And as someone who wouldn’t know an “endogenous dependent variable” if one bit me in the face, I find it hard to look at criticisms of these studies’ methodologies and determine which ones to believe.  Yet it’s obvious that any study on piracy must rely on real-world data in order to have any credibility at all.

Decisions about business and policy have to be made based on the best information we have available.  After a certain point, simply poking holes in studies — particularly those whose results you don’t happen to like — isn’t sufficient.

It may indeed, as the GAO suggested, be impossible to measure the economic effects of piracy with a large amount of accuracy.  But if dozens of researchers have tried, all using different methodologies, then their conclusions in the aggregate are the best we’re going to do.  Put another way, it will henceforth be very difficult to dislodge Smith and Telang’s conclusion that piracy does economic harm to content creators.


The Artists’ Rights Movement July 10, 2012

Posted by Bill Rosenblatt in Music, Uncategorized.
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The phenomenon that I called the Loweryquake has survived the press’s news-cycle rhythm and the proverbial 15-minute time limit.  It continues to reverberate throughout the mainstream press and techblogosphere.  It has led to a lot of what New York magazine last week called “actually pretty thoughtful online discussion.”  And it has engendered what can only be called a movement in favor of artists’ rights.

This has nothing to do with the RIAA, MPAA, or any other representative of Big Media.  The Artists’ Rights Movement is the product of actual content creators, real people who make the copyrighted works and receive the royalty checks… or not, as the case may be.  They are in favor of stronger copyright enforcement, eager to expose technology industry profitability on the backs of recorded content, and deeply skeptical of many of the schemes that have been suggested to make up for lack of compensation from content in the digital age, from T-Shirts to “True Fans.”  (They also sometimes espouse extreme positions such as curtailing First Sale.)

David Lowrey’s blog The Trichordist is fast becoming the unofficial house organ of the Artists’ Rights Movement.  The Trichordist Random Weekly Reader, a weekly post of links to relevant articles around the web, is becoming as useful in its way as the lamented Rightscom Daily Briefing was before it was discontinued a few years ago.  The Trichordist also aggregates other sympathetic blogs such as Copyhype and Fareplay, and more mainstream columnists such as Andrew Orlowski of The Register and Helienne Lindval at The Guardian.

Through The Thrichordist Random Weekly Reader I learned, for example, that the Center for Copyright Information (CCI) — the United States’ private-sector analog to graduated response regimes in countries like France — has appointed an Executive Director and is gearing up to launch later this summer.  The surprising tidbit about this news is that they have appointed an advisory board that includes people representing consumers, privacy issues, and so forth — including Public Knowledge CEO Gigi Sohn.

It’s good to see Gigi Sohn doing something constructive like this.  My opinion of Public Knowledge had been declining since its excellent white paper on 3D printing over a year ago.  Its output has shifted towards shrill fire-up-the-base scare tactics.  Its attempt to tie its Internet Blueprint to SOPA and PIPA was a particularly disingenuous piece of opportunism.  Sohn has said that she will try to influence the CCI to stay away from copyright enforcement through suspensions of users’ ISP accounts. But more generally, the CCI advisory board will benefit from her point of view and, frankly, her presence will serve to blunt accusations that it’s a cabal between Big Media and ISPs and that consumers’ concerns aren’t being heard.

An article in today’s New York Times suggests that a main theme of this week’s annual exclusive Sun Valley media/tech summit will be constructive engagement on copyright infringement.  On the one hand, RIAA CEO Carey Sherman has stated that he’s giving up on legislation as a remedy, now that SOPA and PIPA have failed (ACTA, which was soundly voted down in European Parliament last week, had long ago lost its teeth on copyright enforcement).  He is more optimistic about “best practice” solutions arising from the private sector.

On the other hand, a top Google executive said, “we do not want to be building a business based on piracy.”  Google also cosponsored an interesting new study of online copyright infringement carried out by BAE Systems Detica in the UK, and while — like all such studies — the methodologies can be questioned, this is another pleasantly surprising development.

These are all hopeful signs that, in the wake of the SOPA/PIPA defeat, the media and tech industries may be ending their hyper-partisanism, and in particular that the tech community may soften its “Party of No” stance regarding using technology to solve problems that were born of technology in the first place. Meanwhile, The Trichordist is clearly growing in influence; it may  (to extend an analogy) even become an MSNBC to the likes of TechDirt’s Rush Limbaugh.

P.S. one organization that really needs to get the memo on the Artists’ Rights Movement is the Future of Music Coalition, which purports to represent independent musicians and songwriters.  They could start by taking a hard look at their own advisory board.

The Loweryquake June 27, 2012

Posted by Bill Rosenblatt in Economics, Law, Music, Uncategorized.

David Lowrey is a semi-legendary musician in one of techdom’s most beloved genres, indie rock.  He sits on Groupon’s advisory board.  He’s neither a rich rock star nor a spokesman for the RIAA.  As a university professor, he is more a beneficiary of what Larry Lessig calls “the academic patronage system” than of copyright.  In other words, you’d expect David Lowrey to be one for “sticking it to the man.”  Yet last week, he wrote a 3800-word masterpiece about the dire state of musical artists in the digital age and the moral compromises that got us there.

As everyone involved with music knows by now, Lowery’s “Letter to Emily White” was originally occasioned by a blog post by an intern of that name at National Public Radio, who admitted to being a big music fan and possessing 11,000 tracks of digital music but only having paid for less than 2% of them (which puts her well below the generally-accepted figure of 5%).  It went viral online and got mentions in the New York Times as well as other major media and blogosphere outlets.

Paul Resnikoff in Digital Music News said it best, in perhaps the most cogent piece of analysis I’ve ever read from him:

Our digital innocence just died … after a decade of drunken digitalia, this is the hangover that finally throbs, is finally faced with Monday morning, finally stares in the mirror and admits there’s a problem.  And condenses everything into a detailed ‘moment of clarity’.

Over the years, I have written occasionally about the “race to the bottom,” in which the price of content is tending inexorably towards zero.  The massive amount of free and illegal content available now, coupled with legal content services’ needs to “compete with free,” has led to more and more legal content offers for less and less money.  Emily White’s frank admission shows that, for a growing number of young people, the race to the bottom in music is over, and musicians and songwriters have lost.

I won’t comment on Lowrey’s piece per se, except to recommend strongly that you read it.  And I will say that as I read more of the posts on his blog, The Trichordist (by other authors as well as Lowrey himself), I found some attitudes about intellectual property that I felt were a little extreme and/or ignorant in their own ways.

Instead, I want to focus on the range of comments people have posted about Lowrey’s Letter to Emily, particularly the negative ones.  The Trichordist curates comments by hand (and has been “accused” of favoring positive comments heavily as they cope with comment volumes that are orders of magnitude higher than usual), but they have appeared unfiltered on other sites — thousands of them.

Some of the negative comments are sober economic arguments that conclude with “This is just the way it is, and we can’t change it, so we all just have to adapt,” citing principles such as supply and demand, value migration, or cost of goods sold.  While I disagree with the “we can’t change it” part, the economics are hard to argue with.

Yet the bulk of the negative comments are remarkable for their defensive attitudes, as expressed through smugness, arrogance, misinformation, rationalizations, and most telling of all, outright hostility towards Lowery.  Many of them remind me of the rhetoric of right-wing political extremists when backed into a corner.  Apart from the ad hominem attacks against Lowrey, the negative comments fall roughly into the following buckets:

  • Economic rationalization (record companies): The record companies rip artists off anyway.  Lowrey rips this one apart in his piece.
  • Economic rationalizations (artists)Musicians can make money touring instead. Ditto.  (Did the people who wrote these comments actually read Lowrey’s piece?)
  • Economic rationalization (users): Emily is just a poor young intern and isn’t able to pay for that music anyway.  See below on the perceived value of music.
  • Legal rationalization: What Emily did was “fair use.”  When your prom date gives you a “present” of 15GB worth of digital music, it’s probably not fair use.  (Of course, that this is even a question is a problem with fair use itself, but that’s another subject.)
  • Terminological distractions: So-called piracy is not “stealing” because the original remains once you have copied it. As even TechDirt’s Mike Masnick points out, what you call it doesn’t matter; it’s copyright infringement, which is against the law.
  • Exceptions that prove the ruleSo-and-so has figured out how to thrive under the new system, so there must be ways to do it.  This one is Masnick’s specialité de la Maison.  He seeks out these examples in order to encourage others to follow them.  That’s fine, but they continue to be few and far between.
  • Market research cherry-pickingI saw a study that says that piracy actually benefits music sales and/or the RIAA/MPAA’s piracy studies are biased.  Let’s agree that no study of the economic effects of copyright infringement is both methodologically unassailable and unbiased, and perhaps that the “real” effect may be unmeasurable.  But if we’re going to cite studies, we should at least look at all of them instead of putting up strawmen for the purpose of knocking them down. I have  looked at all of the studies (and not just those about music) and found that those that claim economic damage from infringement outweigh those that claim economic benefit by a wide margin, even when studies commissioned by the RIAA or MPAA are ignored.

I am also reminded of a conversation that took place at the Copyright and Technology conference last week in London.  The eminent copyright litigator Andrew Bridges echoed the common copyleft refrain that “copyright infringement is not a problem” except perhaps that “some companies are losing money.”  He also asserted that the sky-high statutory damages under United States law act as an effective deterrent to copyright infringement because they scare people.

I disagreed with both statements.  The case of Emily White is the best counter-argument I could have made to both points if I had known about it at the time.  For every Joel Tenenbaum or Jammie Thomas-Rasset who makes headlines getting nailed for copyright infringement (and getting Harvard Law professors to defend them), there are  millions of Emily Whites who don’t, and millions more who have no idea about copyright infringement, let alone statutory damages.

However, none of these arguments addresses the real problem.  The real problem is that the value that people perceive in music has virtually disappeared.  As Jaron Lanier pointed out in his book You Are Not a Gadget and subsequent writings, there is a profound cost to society as the perceived value of original content goes to zero.  And the cost goes well beyond questions of whether there is “enough creative content” if artists can’t make livings.

Lowrey’s Letter to Emily is more about morals and ethics than about the inherent value of content.  The problem is that simply preaching ethics to people in order to get them to change their behavior doesn’t work.  At best, as Ben Sisario points out in the New York Times, this gets musicians to the status of charity recipients.

A more recent post on The Trichordist, by Lowrey’s Camper Van Beethoven bandmate Jonathan Segel, focuses exclusively on perceived value — after providing an illuminating history of musicians’ compensation since Beethoven.  Killer quote:

What is happening here seems to be a willful ignorance that the inherent value is still there, not being paid for in the distribution of additional copies. These same individuals would certainly make the claim that they are copying the music in order to listen to it … but are refusing to admit the relevance of the social contract that says that that inherent value is what is used in the exchange rate with monetary currency. I see this as a hypocrisy: either music has no value at all, (in which case why copy it to begin with?), or it has value and the copiers are refusing to admit that it does, simply because it is a copy.

Once this behavior becomes normal — i.e. becomes standard practice for the Emily Whites of the world — then the taint of hypocrisy disappears.  Once that happens,  concern over the value of content evaporates, as then does the value itself.

The time for questioning whether or not this is a problem is over.  The proper question is how to solve it.

The Harry Potter Watermarking Experiment April 8, 2012

Posted by Bill Rosenblatt in Uncategorized.

As more users explore the magical world of Pottermore, J.K. Rowling’s site for all things Harry Potter, we are finding out that the EPUB e-book files it sells may be DRM-free, strictly speaking, but are not devoid of rights technology.  Instead of encryption-based DRM, Pottermore is using a watermarking scheme that the Dutch vendor Booxtream markets as “social DRM.”

Users can purchase each Harry Potter e-book title once and download it up to eight times, in multiple formats.  That’s a real convenience; it’s a “rights locker” scheme reminiscent of UltraViolet for movies.  As I mentioned previously, the Kindle and Nook versions have DRM.  The EPUB version that I downloaded is not DRM-protected; instead it contains two things: “This book is watermarked and was acquired by user ec107c00b9577436d6354e54cd9da5c9 on 31 March 2012″ on the copyright page, and various bits of data inserted invisibly into images and other places inside the book.

This data ought to be easy to remove without trace.  The files appeared on torrent sites very shortly after the Pottermore Shop went live.  A programmer with middling skills could write code that detects and removes the data; even if the illustrations in the book were a bit damaged, readers wouldn’t care.  Such a hack for Booxtream doesn’t exist yet (at least publicly), but the irony is that if this scheme catches on with more authors and publishers, it surely will.

Such a program would be perfectly legal; it would not violate anticircumvention law such as DMCA 1201 in the United States.  It would be what I call a “one-click hack,” like the (illegal) DeCSS rippers that hack the weak CSS encryption on DVDs, which the non-tech-savvy can easily use and which is permanent.  In other words, it would impose the same level of effort on users as a format conversion tool, such as the free Calibre, which can (among other things) convert EPUB files to MOBI files for Kindles so that users can get DRM-free Harry Potter titles for their Kindles after all.

Furthermore, even though Section 1202 of the DMCA forbids removing “copyright management information” from files, the watermark does not qualify as copyright management information as defined in the law.  This means that under U.S. copyright law, the user is free to apply such a hack.

Some would argue that watermarks are no different from weak DRMs (like CSS) in terms of the “speed bump factor” because both have one-click hacks available.  But the fact that watermark removal tools are legal and DRM strippers aren’t makes a difference. DRM strippers must hide in the shadows, but watermark removal tools can exist out in the open.  If they are available for free (which seems very likely), then it would be difficult to try to stop them through legal channels.  I could even see a watermark removal feature built into a popular application like Calibre, since it’s free and open-source.

Pottermore’s Terms and Conditions forbid altering or removing the watermark data, but this may not mean much.  It is possible that copyright law may prevail over such terms; this is a legal gray area.

The legal principle here is First Sale (Section 109 of the U.S. copyright law), known as “exhaustion” outside the U.S.  This says that the publisher has no further control over a work once a person has obtained it lawfully.  While this law enables libraries, used book/record/video stores, and other such institutions for physical goods, its applicability to digital files is unsettled — although as I said previously in connection with ReDigi, the digital music resale service, both media companies and digital retailers are highly motivated to ensure that Digital First Sale never happens.  This Harry Potter case is yet another example of why.

(By the way, an update on ReDigi since I wrote about it last November: EMI sued the company back in January.  The following month, the judge in the case denied EMI’s request for preliminary injunction, meaning that ReDigi can keep operating as the case goes to trial.)

This all leads me to question why Pottermore bothered with this watermarking scheme in the first place.  It seems rather pointless.

I assume that “user ec107c00b9577436d6354e54cd9da5c9″ is an obfuscated version of my user account ID on Pottermore.  I also expect that Booxtream lets the retailer use whatever character strings it wants.  If Pottermore really wanted to discourage me from infringing the copyright on the e-book, it would put my email address, or even the number of the credit card I used to buy it (which was an option in the now-discontinued Microsoft Reader e-book technology).  Even the vehemently anti-DRM publisher O’Reilly & Associates uses a watermarking scheme for its downloaded PDFs that puts the user’s real name on every page of the books.

Instead Pottermore, put a character string that means nothing to nontechnical users, presumably to avoid privacy complaints (which would also encourage hacking), and put it in a single place that most readers ignore.  This “social DRM,” at least the way Pottermore has implemented it, is a shy and retiring beast.  There is also a standard legalese copyright notice in the e-book, but no one pays any attention to those either.

Given that non-EPUB versions of the Harry Potter e-books have DRM, I suspect that Pottermore would have used DRM if it were possible to have a seamless user experience with EPUB files, as is the case within the Kindle and Nook ecosystems.  (Pottermore could have chosen to do without DRM for those formats too, but it didn’t.)  The lack of a standard DRM for EPUB integrated with EPUB reader apps makes such an experience unobtainable; hence Pottermore’s use of Booxtream instead of DRM.  In other words, Pottermore is not against DRM, but it intentionally traded off the best possible user experience and respect for user privacy against some level of protection.

I fail to understand what behaviors Pottermore is trying to prevent here.  Even a plain-language message to purchasers — which involves no technology and costs nothing to implement — would alert them to legal and contractual limitations on use.  Instead, the current scheme, with its cryptic message, legalese, and hidden data, doesn’t really alert anyone to anything, let alone prevent anyone from doing anything.  At best, it’s a “Gotcha!” for nontechnical users who upload files to places where Pottermore presumably pays Booxtream to look for watermarked files.  Those aren’t the users whom Pottermore should be most interested in targeting, and if Booxtream does catch anyone and cause a nastygram to be sent, then backlash will ensue.  And isn’t Pottermore trying to prevent backlash in the first place?

Retailers that pay for rights technology ought to get something for their money.  Booxtream might be effective if used differently; otherwise I don’t see much benefit to Pottermore for this watermarking scheme.

Hadopi Becomes un Ballon de Football Politique February 21, 2012

Posted by Bill Rosenblatt in Europe, Law, Uncategorized.

Those of us who deal with the so-called copyright wars here in the United States can take comfort in one thing: the battles between Big Media and Big Tech have mostly avoided getting sucked into this country’s corrosive, debilitating party politics.

The “balanced copyright” movement has some alignment with leftist politics — not for nothing do many call it “copyleft” — but that’s mostly confined to academics and a handful of not-very-industry-aligned advocacy groups.  Now that SOPA and PIPA are dead, the Republicans who run Congress can’t decide whether to continue to align themselves with the politically entrenched media industry and promote further legislation, or to tout individual liberties (and appease the burgeoning Big Tech lobby) and repudiate such legislation.  Nobody involved in this year’s presidential election has touched the online copyright issue.

France, however, shows a completely different picture.  As a recent New York Times article describes it, the Hadopi progressive response legislation has been in place for two years, warnings have been issued to consumers caught downloading illegally, and the first group of repeat offenders — 165 of them — have been handed over to the justice system for potential fines and suspension of their Internet accounts.  The first warnings were sent out in October 2010,  about 1-1/3 years ago.

First of all,  let’s compare this with the RIAA’s campaign of individual lawsuits in the US: the RIAA appears to have gone after between 18,000 and 35,000 people over a period of five years, or 3600-7000 per year on average.  Even if one allows for the fact that France has 19% of the Internet-using population of the US, the number of French Internet users thus affected by Hadopi is only 18-35% of the proportionate number of US Internet users sent nastygrams by the RIAA.

Every study of the Hadopi system that has been done so far has shown the system to be successfully reducing illegal downloading and increasing legitimate consumption of content, particularly music sales on iTunes.  (The effect of the law on subscription streaming services like Deezer and Spotify hasn’t been measured.)  One would expect the “usual suspects” to debunk the studies, but they haven’t.  Instead, there have been statements such as “the effects are undeniable but hard to quantify” (the liberal newspaper Le Monde) and “Apparently some of its intimidation is having a psychological effect” (La Quadrature du Net, a French advocacy group which otherwise argues that Hadopi is a waste of taxpayers’ money to solve a nonexistent problem).

In other words, like it or not, the Hadopi system seems to be working so far.

French President Nicolas Sarkozy, who actively supported the Hadopi law, is up for re-election himself.  As a result, online copyright has become in France what we in America call a political football.  Socialists have been the most vocal enemies of the Hadopi law in France and have been calling for flat-tax statutory licenses, following the ideas of the Electronic Frontier Foundation, Terry Fisher of Harvard Law School, and other copyleft figures.  Yet now that the right-wing candidate Marine Le Pen is now stealing the socialists’ thunder by calling for a statutory license herself, the socialists are backing away from the idea, calling instead for some hazy combination of taxes and crackdowns on sites that enable illegal copying.  Nevertheless, both anti-Sarkozy parties have professed Hadopi hatred, as both a populist gesture and a Sarkozy differentiator.

This is just a little bit crazy.  Conservatives are supposed to be for individual liberties, low taxes, and small government.  So what is a hard-right politician doing embracing a system that amounts to a tax on content, no matter how much each consumer uses, and that distributes money to content creators through opaque, government-entrenched entities like the collecting society SACEM?  And what are the socialists, who are supposed to be for big government and equitable distribution of resources, doing opposing it?  I’m sure that I, as an American, do not have a proper understanding of French politics.  But to me, this smacks of political opportunism and demagoguery of the type that we are deluged with in this US election year on issues such as healthcare, taxes, gay marriage, etc., etc.  It’s sad.

I think five years is a reasonable timeframe in which to judge the success of Hadopi, so it’s premature so far.  Die-hard infringers will find ways around the system, such as through anonymizers, virtual private networks, and file encryption; we have yet to see how popular such methods become.  The fairness and effectiveness of the enforcement and appeal mechanisms have yet to be established.  But one hopes that Hadopi’s educational effect coupled with the fear of getting caught will reduce infringement enough to make it worthwhile; in that case, other countries should adopt progressive response with a strong educational component too.

Let Hadopi-haters do their own serious quantitative studies, and let’s compare the results.  Let’s make the judgments on facts, and for God’s sake let’s not let political posturing pollute the atmosphere.  Then let’s see the Copyright Alert System assess what’s working in Hadopi and adopt it here in the United States, where — at least for the moment — no one need worry about the issue being demagogued to death in election years.

Who’s Subsidizin’ Who? February 9, 2012

Posted by Bill Rosenblatt in Business models, Music, Publishing, Services, Uncategorized, United States.
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Barnes & Noble has just announced a deal offering a US $100 Nook e-reader for free with a $240/year subscription to the New York Times on Nook.  Meanwhile, MuveMusic, the bundled-music service of the small US wireless carrier Cricket Wireless, passed the 500,000 subscriber mark last month.   MuveMusic has vaulted past Rdio and MOG to be probably the third largest paid subscription music service in the United States, behind Rhapsody and (probably) Spotify at over a million each.

MuveMusic isn’t quite a subsidized-music deal a la Nokia Ovi Music Unlimited, but it does offer unlimited music downloads bundled with wireless service at a price point that’s lower than the major carriers.  (The roaming charges you’d incur if you leave Cricket’s rather spotty coverage area could add to the cost.)  Cricket is apparently spending a fortune to market MuveMusic, and it’s paying off.

It looks like the business of bundling content with devices is not dead; on the contrary, it’s just beginning.  The fact that both types of bundling models exist — pay for the device, get the content free; pay for the content, get the device free — means that we can expect much experimentation in the months and years ahead.  Although it’s hard to imagine a record label offering a free device with its music, we could follow a model like Airborne Music and think of things like, say, a deal between HTC and UMG offering everything Lady Gaga puts out for $20/year with a free HTC Android phone and/or (HTC-owned) Beats earbuds.  Or how about free Disney content with a purchase of an Apple TV?

As long as someone is paying for the content, any of these models are good for content creators. device makers, ane consumers alike.  Bring them on!

Updated DRM Reference Table Now Available January 19, 2012

Posted by Bill Rosenblatt in Uncategorized.
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I have updated the GiantSteps DRM and Content Protection Reference Table that I have been maintaining for the past three years.  This version updates the previous version from April 2010.  The update includes updated information on over three dozen DRM, conditional access, and other content protection technologies, as well as an expanded section on independent protection technologies for PC games and software.

You can get a copy of the table in PDF (4 x 2 page layout) for free here (scroll down to the form and choose “DRM and Content Protection Reference Table (PDF)” from the dropdown menu).  Or, if you would like the unprotected Excel spreadsheet, the cost is USD 300 (PayPal accepted), click here to order.


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