Copyright in a Post-Napster World

"One of the original objectives of the [US] Constitution was to encourage innovation by providing creators exclusive rights for limited times."

But, "This objective has been subverted to the extent that the DMCA’s [Digital Millenium Copyright Act] anti-circumvention provision and copyright term extensions can stifle legitimate and desirable innovation and improvement or creation based on pre-existing works.

"As digital media distribution schemes mature, the extraordinary amount of control within reach of the copyright holders and content companies is likely to be augmented from an unlikely legal quarter: contract law."

This is one of the principal conclusions of Copyright and Digital Media in a Post-Napster World, a compelling document produced by GartnerG2 and The Berkman Center for Internet & Society at Harvard Law School.

The Berkman Center says its mission is to explore and understand cyberspace, its development, dynamics, norms, standards, "and need or lack thereof for laws and sanctions" and the Post-Napster paper aims to provide a foundation to answer key questions facing copyright holders, technology developers and consumers.

Digital technologies and digital media content — from entertainment to reference material — have become more portable in time, space and format, it says, but "Content providers have been slow to adapt to digital distribution for fear of crushing old business models before they devise new ones.

"By and large, industry players have implemented digital technology to protect old business and to aggressively pursue perceived abusers of copyrighted material. They have solicited and received assistance in these efforts from legislators in the form of the DMCA and other legislation aimed at preventing what they perceive as illegal copying or sharing of copyrighted content."

With copyrighted material, especially recorded music, movies and print, digital advancements have exacerbated the historic tension between copyright holders — generally the entertainment industry — technology providers and consumers.

Laws to protect content providers and copyright holders have become progressively restrictive, two examples of that being the 'anticircumvention tools' provisions of the DMCA, and "Congress’ continued extension to the copyright term," states the document.

"The extraordinary control exerted by copyright holders/content providers extends along the digital media value chain, from creation and production to distribution and, with DRM tools, to playback. "

One of the original objectives of the Constitution was to encourage innovation by providing creators exclusive rights for limited times, it states, but this objective has been subverted to the extent that the DMCA’s anti-circumvention provision and copyright term extensions can stifle legitimate and desirable innovation and improvement or creation based on pre-existing works.

"Current case law and precedents hold that the law will generally honor a valid contract over an entitlement authorized by Congress under the Copyright Act," it warns. "Therefore, companies providing content online may request consumers to agree to give up rights (such as copying for backup purposes or other fair use exemptions to copyright law) in order to sign up for the provider’s service.

"In a truly efficient, competitive market, this might work well enough, assuming consumers are informed, aware and agree with such terms. The potential for alienating consumers and snuffing out true digital distribution is very high, especially if the result is strict enforcement of an increasing number of online contracts that cannot be negotiated and are often never even read or viewed by the 'agreeing' consumer."

Earlier, the paper says the legislative outlook at the federal level is decidedly mixed. Several pro-consumer and technology industry bills are pending that would expressly legitimize fair use for consumers using digital media and protect the manufacturers of products that permit such fair uses, and protect scientific research efforts on technology protection measures.

But ready to counter those measures, "are bills sponsored by the entertainment industry, including measures that would require manufacturers of products to incorporate technological measures into digital products to prevent copying, whether fair or unfair, and provide private causes of action and stiff penalties for violations, both criminal and civil."

However, the entertainment industry’s efforts have spread from Congress to the FCC for rulemaking on the broadcast flag to protect broadcast video programming.

"Content owners are concerned about unauthorized rebroadcast, copying and sharing of digital programming content. Technology manufacturing companies and consumer groups oppose any mandate of technology standards by the FCC that may deprive consumers of their fair use rights," says the paper, continuing:

"The music industry is the first to face the potential benefits and terrors of digital distribution. First, the ability to deal directly with buyers without the expense of a physical distribution network; but then the uncertainty of competing with 'free' content.

"Challenge: Securing digital transactions and, in light of KaZaA and other P2P networks, creating a more compelling alternative to decentralized file-sharing networks remain the key challenge.

"Benefits: The Internet and new technologies have proven extremely effective marketing tools for the music companies and musicians. Labels can use Web sites to promote new releases, provide samples and near-instantaneous access to an artist’s back catalog."

New technologies are threatening to destroy US TV broadcasters' "ad-heavy business models," and PVR [personal video recorder] technology threatens existing TV network revenues, as well as back-catalog movies and other potential packages of older TV and film content, while at the same time offering new opportunities.

Sections include:

1 Evolution of Copyright Law: How We Got Here
• The US Constitution and the Copyright Act
• Limitations on copyright
• Statutory responses to digitization
• International and European laws
• International enforcement issues

2 Business Models in Transition
• Music
• Film
• Television
• Publishing
• Changing consumer behavior
• Current behavior and future possibilities
• Consumption, copying and sharing
• PC technology meets the modern network

3 Relevant Cases and Developments
• Adjudicating fair use
• Enforcing the DMCA
• Copyright and the Constitution
• Electronic publishing rights
• Beyond copyright
• International and jurisdictional cases

4 Proposed and Pending Law
• U.S. regulatory developments
• U.S. legislative developments
• Regulatory developments abroad
• Other developments abroad
• Proposed legislation

5 DRM

6 What’s Ahead
• The law
• The legislation
• The business

NOTE: You can can download a .pdf of the document here.