[DMCA-Activists] Comments + Broad Overview of Exclusive Rights Approaches

[Seth Johnson]

(Forwarded from Interesting People list.  See Hsi Shen's
comments, plus the essay at the link lower in the thread,
the text of which is pasted at the end of this email.  It is
another broad overview of approaches to exclusive rights in
the digital age.  -- Seth)

-------- Original Message --------
Subject: FW: [drm] Essay on the various answers to the
copyright crisis
Date: Thu, 07 Nov 2002 08:05:46 -0500
From: Dave Farber <address@hidden>
To: drm class <address@hidden>

------ Forwarded Message
From: Hsi Shen <address@hidden>
Date: Wed, 06 Nov 2002 03:22:09 -0500
To: Dave Farber <address@hidden>
Subject: Re: [drm] Essay on the various answers to the
copyright crisis

Hi Prof. Farber,

Hypothetically, if we livei n a world without DRM ever
having the possibility of existing, why would I want to
"solve" the copyright issue?  The fact that the digital
media copyright people complain, does not mean that
government or other regulatory bodies must impose some new
"cost."  I found it odd that we were trying to figure out
"ways" to pay off the media companies to keep them quiet--my
point being that even when they do make a fuss, nothing
changes in the end.  If the recording industry, or digital
media industry wants to "try" to impose new technical
copyright solutions, or just impose a new tax--I don't think
this would ever succeed.  They would risk losing market
share, unless they somehow colluded with the rest of the
industry.

In addition, if we were to suggest a solution such as taxing
the ISP for audtio/video downloads--the first problem would
be getting all the ISP's to cooperate.  There is no
incentive for them to jack up prices by 5 or even 10
dollars.  Unless the government wants to intervene, this
solution does not seem feasible either.

We might just be better off having the government or other
organizations enforce the rules they have on the books at
the moment--but since it's expensive to track illegal usage
and to prosecute everyone that breaks the copyrights--the
industry should just accept it as being a fact of doing
business.

If music/video copyrights did not exist, I doubt our world
would lack music or entertainment.  Yes, it may reduce the
incentives to be "creative."  And maybe big companies might
leave the business b/c it would be "unprofitable" which is
still a doubtful situation IMHO.

your thoughts?

Also, any word on our draft TCPA/Palladium papers?

-hsi-

----- Original Message -----
From: "Dave Farber" <address@hidden>
To: "drm class" <address@hidden>
Sent: Wednesday, November 06, 2002 1:36 AM
Subject: [drm] Essay on the various answers to the copyright
crisis


> ------ Forwarded Message
> From: Brad Templeton <address@hidden>
>
> As part of this debate, I was working on an essay summarizing the many
> answers we've seen from all sides to the copyright question.
>
> It is at:
>     www.templetons.com/brad/copysolve.html
>
> I would appreciate comments people may have about
> other proposed solutions that they have seen to add
> to the list.  I will be fleshing things out more, I
> just rounded out the essay today in response to
> this thread.

------ End of Forwarded Message
_______________________________________________
Drm-class mailing list
address@hidden
http://boiling.fluid.cs.cmu.edu/mailman/listinfo/drm-class

----


> http://www.templetons.com/brad/copysolve.html


Solutions to the Copyright Crisis

By Brad Templeton


Everybody's become aware that the concept of copyright is in
crisis. Digital media love to be copied, and copies are
perfect generation after generation. The people have
demonstrated a willingness to ignore copyright rules if not
given exactly what they want -- either in terms of
convenience or price. In addition, those who have ignored
the rules have built new technologies to allow distribution
and sharing with unprecedented efficiency and ease. 

At the same time, we're building an information economy,
where building creative work, traditionally monetized
through copyright, is becoming a big part of the economy. In
the future I think it will dominate it. 

So some system needs to be found, some way to assure that
creators can make money from their efforts, the public's
freedoms are not restricted and incentives can be provided
to develop and invest in the development of important
creative works. 

I'm collecting and trying to devise possible outcomes and
solutions that can keep a creative economy going. Here are
the ones I have encountered and some views. Many of these
focus on music, as it is the first sector of the creative
economy to become embroiled, but in fact solutions are
needed for all the creative milieux -- movies, books,
software, news and more. 

I apologize for the use of the word "content" in this
summary, as I know it bothers some who dislike summing up
creative work with such a commercial word. It is however the
best concise generic word for the job. 

Copyright is Dead, Get Over It.

More and more are saying that the concept of intellectual
property was a mistake, and should be undone. Information
wants to be free, and will be free no matter how people try
to stop it. They sometimes mean free as in unbound, and
sometimes as in at no cost, and sometimes both. 

Copyright, they point out, is a recent invention, and the
media industries are relatively recent inventions in fields
like TV, music and so on. 

Without copyright, they hope for new business models, or the
resurgence of older ones. Musicians might rely on live
performance rather than recordings, as they did before
record sales became big. Some of the solutions below are
mostly new business models that people hope will work
without law to enforce them. 

It's fair to say that some media would still thrive without
copyright or money. The vast majority of musical acts and
writers are not in it for the money. Anything that's a
one-person-show will continue paid or not, out of drive and
dedication. However, things that require investment, like
blockbuster movies, many types of software packages and
large scale investigative journalism would probably suffer. 

In addition, some, though far from all, believe there are
some moral rights or natural rights behind copyright. That
it would simply not be fair to creators to have them lose
all control of their creations. 

There is also major concern over what would support the big
media which form the vital "fourth estate" in a free society
-- ie. what gives a news organization like the Washington
Post the financial power to take on the President of the
United States without copyright? 

Pay creators with a tax or tax-like charge

This suggestion is growing more and more popular. In it,
some sort of fee would be tacked on to media or bandwidth,
and the proceeds from that fee would be distributed to
copyright holders according to some formula. 

This could be done as a tax, and in fact we have already
seen such taxes on DAT tapes and blank audio CDs in exactly
this style. Since many users no longer copy works to
removable media like CDs, it has also been proposed as a
surcharge on ISPs, presuming that users will use some
portion of internet bandwidth to transfer copyrighted works
for which compensation should be paid. It is uncertain how
to fairly deal with the many different models of bandwidth
sharing now extant and planned for the future, such as
wireless community networks. Taxing bandwidth means
registering and policing bandwidth. 

Sometimes it is proposed that it simply come out of general
tax revenues, to provide support for creative work. 

It has also been proposed as a fee that is not strictly a
mandated tax. The fee could either be voluntary or a
protection against liability for lawsuits over copyright
infringement. For example, ASCAP charges all music halls,
bars, theatres and arenas a fee that covers all ASCAP member
written music played there. If a venue doesn't pay, they
face being sued if anybody ever plays such music there.
ASCAP and its counterpart BMI have a near monopoly on
popular music, so they are able to enforce such a fee. 

If ISPs or media makers felt a fear of liability, they could
be pressured into collecting such fees. 

The fees would be distributed to copyright holders based on
some measurement of the popularity of their works in the
area in question. This could be done by using sales figures
from other media, or by statistical analysis and surveys of
popularity. A wide variety of formulas might be used. In the
example of ASCAP, the formula is (with some controversy)
based on the genre and style of music (jingle vs. score vs.
song) and even seniority of the member. 

There are many arguments about what to tax. Each has fair
and unfair aspects. Taxing audio CDs punishes those who
record their own music on CDs. Taxing internet bandwidth
punishes those who make heavy internet use but don't
download copyrighted material. (For example perhaps they
just have a video-phone. Taxation from the general fund
punishes those who consume far less copyrighted material
than others, and those who buy it rather than take it
without payment. (Of course most taxes penalize one group
over another.) 

In some ways this idea is quite old. The BBC is paid for by
a tax on television sets, regardless of how much they watch
the BBC, with TV police who search streets for unlicensed
sets. 

Many consider this to be one of the most practical
solutions, but at the same time it raises serious questions
about fairness, the rights of creators and government
involvement in the business of creation. It is also worth
considering that governmental and institutional solutions
without fail become bent to the will of the most powerful
special interests. 

Digital Rights Management

The favoured solution of big content distributors is to only
publish their works locked up with technological
protections. These protections, known as DRM, attempt to
assure that only those who are authorized get to make use of
a copyrighted work. They can both enforce the copyright law
using technology, and also provide restrictions not possible
under copyright law. 

Due to the problems of making secure DRM, it has been
coupled with legal efforts to offset its flaws. The Digital
Millennium Copyright Act, for example, makes it illegal to
bypass or make tools to bypass DRM, and a good deal more. 

The push for DRM has extended into "trusted computing"
initiatives which would arrange for formerly general-purpose
PCs to be designed to support DRM and forbid their owners
from accessing locked materials in an unauthorized manner
even on their own computer. 

There have been efforts for legally mandated DRM, first in
Digital Audio Tape (DAT) and more recently in proposed bills
for broadcast television and even all computers. These laws
would make it illegal to make or sell computers,
televisions, video and audio recorders and players which did
not enforce DRM rules. 

Many forsee serious problems with the widespread adoption of
DRM and particularly laws mandating and protecting it,
ranging from stifling of innovation and restriction of fair
use, freedom to program and freedom of speech. 

Legal attacks on distribution technologies and users

Since much of the copyright crisis has been realized through
internet technologies that make it very easy for users to
republish and share materials in ways unauthorized under
copyright law, large content distributors have mounted legal
attacks on companies providing things like file sharing
technology. There have also been attacks on new media
players (like the first generation of VCRs, MP3 players and
Personal Video Recorders such as the Replay TV.) There have
also been lawsuits against ISPs and web hosting companies. 

More rarely, there have been legal attacks on individual
users who were infringing copyrights. More common have been
threats against their providers and DMCA "takedown" orders
on such providers. The DMCA offers the ability for a
copyright holder to demand that an ISP remove or disable
individual infringements or infringing users. If the ISP
does so they are shielded from liability for the
infringements done using their systems. 

Many worry these legal attacks will go after technology
rather than infringement, and chill legal software
development and the legal use of these technologies. 

Micropayments & Digital Money

Many have desired a means to pay copyright holders quickly
and directly online with digital money. Generally the
payments for things like songs, short stories, web pages and
such are small enough to come under the "micropayment"
umbrella. Micropayments are small payments that must be done
with little overhead. Since credit card transactions involve
fees of at least 25 cents in most cases, it's not possible
to do quarter or even dollar transactions with credit cards. 

People seek a way to easily and reliably pay small amounts
when they download or play a song or other similar material.
It may be compulsory or optional, but either way, the
micropayment digital money infrastructure is required. 

Many companies have tried to build online digital money and
micropayment infrastructures, but so far none have attained
any success. Online payment is still largely done via credit
cards, or the credit-card-like Paypal system. 

Generally the most hope has resided in aggregators which
would collect many micropayments into a single bill
presented at the end of the month and charged via an older
system like the credit card or EFT. 

Micropayments, should they become popular, still beg the
question of whether people will pay if they can get material
without paying. 

The market will figure it out

While it seems facile, a number of people point out that in
the past, when new technologies have appeared to threaten
the existing business models of the creative economy,
something new has usually appeared that solved the problem
or created a new business model. It's not usually been
possible to predict what it would be, and certainly those
most deeply involved in the existing business methods have
had difficulty forseeing the future. 

New solutions that have arised have often been matched by
new legal frameworks which either encouraged the new model
or were created in reaction to it. Sometimes these new legal
frameworks met the desires of entrenched special interests.
Sometimes they truly fostered innovation. 

As such, some advocate that while they don't know what the
solution will be, they have strong faith it will be
discovered in a free marketplace of ideas and technology. 

Tips, gifts and shareware

A number of proposals have come forward to arrange for
voluntary compensation of creators by fans. These include
"tip jars" which are now available in online form, such as
the Amazon.com honor system. 

Some proposals borrow from the shareware world, where
software is made available for free, but those who decide
they like it are asked to pay or even repeatedly annoyed
into paying. 

This model has worked for some shareware authors, and is a
serious source of revenue for things like Public Television
and Radio with their pledge drives. However, shareware
approaches also include a much larger number of failures to
generate significant revenue compared to the failure rate of
commercial ventures. 

Patronage

For much of history, almost all art and creative work has
been paid for by wealthy patrons. The patrons supported
artists either to promote their own tastes, or out of a
sense of philanthrophy. In more recent times, governments
have become the major patron of the arts, and in many
nations they are the largest funder of certain genres of
creative work. (Thus making this solution similar to the
concept of payment from general tax revenues.) Some suggest
a return to this system or a modern version of it. 

Non-copy related business models

Associated with the idea that copyright might be dead, many
have proposed that creators and their distributors seek
other forms of making money from their work that don't
depend on charging for individual copies. In music, common
proposals including depending on live performance revenues
(concert tickets) as well as sales of merchandise and other
premium items. Money can also be made from institutional
copiers (commercials, music halls, radio stations, etc.) and
those wishing to make derivative works or use the music in
other media (ie. music that ends up in a movie.) 

Indeed some of the other proposals above would be added to
the list of non-copy based revenue. Others have suggested
that premium copies can make money while ordinary copies are
free. For example, Red Hat Linux, to take an example from
software, is free to download but they make significant
money from boxes in stores with pre-burned CDs, manuals and
support. 

Special high quality copies, signed copies and so on might
be sold even if ordinary copies are free. 

Revenue levels for these methods are uncertain and in need
of development. They can work for some media but not for
others, or with different efficacies in others. 

Microrefunds

I believe that the failure of micropayments, and of
voluntary payments, can be placed on the resistance of users
to making lots of small financial decisions as they go about
their daily reading and listening lives. I feel a solution
might exist in asking users to make just one decision to
participate in rewarding creators, so that the default
whenever they "consume" creative work is to pay for it, with
no action or thought required. 

To make them feel at ease, the system would allow
microrefunds of any fee paid by default. This would
effectively mean all content comes with a money back
guarantee, and that users can scan their charges at the end
of the month and void any that are too high or which were
for poor quality material. In a voluntary system they could
void them all, or simply not join the system. This proposal
is detailed here.