p2pnet talks to Michael Weiss
p2p news feature / p2pnet: “We’re not in the DRM business,” StreamCast Networks ceo Michael Weiss told p2pnet’s Sally Hawkins in a Q&A.
“If a user encounters a DRM file, that user is obligated to follow the rules of that file. But at the end of the day, DRM may be counterproductive to content owners – it may protect downloads, but it stifles innovation and consumer adoption.”
>>>>>>>>>>>>>>>>>>>>>>>>
Countering wrong perceptions and misinformation with actual facts ……….
Hawkins: I read somewhere recently that the civil jury trial against Morpheus has commenced in the District Court (may have just been a procedural issue – not sure)? Is this correct? If yes, how has it been going, how much longer are arguments expected to take? And when do you think there will be a result? If no, when is it due to commence and what arguments will you be making?
How important is it to the wider technology industry that the inducement bar is set high? Is it possible that if you lose you could be forced to pay damages but not necessarily be closed?
Weiss: Basically, the Supreme Court sent the case back to the trial court. The court can now do a few things including consider motions for summary judgment now or after additional discovery is conducted, or deny the motions for summary judgment that have been filed and set discovery cut-off dates and a trial date, with the Court or a jury then having the responsibility of looking at all of the material evidence , determining things like whether the entertainment companies misused its copyright, what the defendant’s intended, and whether the acts and intentions of the defendants were so egregious as to have risen to the level of having induced others to commit copyright infringement. The next court date is currently scheduled for the middle of July on the latest round of motions for summary judgment brought by the plaintiffs. There’s an update on the current litigation on the StreamCast web site.
Hawkins: I saw recently that you spoke at the Distributed Computing Industry Associations P2P Summit – Morpheus has not in the past been associated with this group – why did you speak and what did you have to say?
Weiss: The DCIA in many ways advocates some of the same reasonable changes in policy and law many of the rest of us want to see happen. I find it best to move on to issues in front of us to achieve common goals. While StreamCast Networks is not a member of the DCIA, I was happy to accept an invitation to speak at the media summit. Morpheus is a leader in this space so I always welcome an opportunity to discuss vital issues affecting our industry. It was good to speak in front of an audience of ‘peers’ that are as receptive to my messaging as was the case with DCIA.
Hawkins: If you could have your ultimate piece of legislation passed, what would it be? Has P2P United expired given the loss of two members?
Weiss: P2PUnited did a tremendous service in promoting the advancement of technology And although P2P United is currently inactive, there are brilliant minds at organizations like Public Knowledge, the Home Recording Rights Coalition, Electronic Frontier Foundation (EFF), the Center for Democracy and Technology, Electronic Privacy Information Center (EPIC) and others, including the CATO institute, who are well equipped to advance policy issues, lobby and work to advance or modify legislation that protects the public’s privacy and personal rights as well as balance the objectives of the U.S. Constitution. They’ve recently worked hard to stop or modify harmful provisions of nearly every major legislative initiative that would give large media companies even more control over information and technology at the expense of individual’s rights.
I welcome meetings with Congressional leaders and other legislators who wish to discuss our technology and to discuss any sincere but serious misconceptions about our technology and us, as well as our industry – as the General Accounting Office has made clear on certain issues in the past.
I’m optimistic that – by countering wrong perceptions and misinformation with actual facts – legislation that could disable the economic engine of technological innovation, as well as the goals of promoting the progress of science and the useful arts for the benefit of society, can be avoided or appropriately tailored.
Hawkins: The Distributed Computing Industry Association and its 70 odd members are fairly supportive of DRM – what’s your position on this? Do you think it’s inevitable or should it be avoided at all costs? Can you understand why movements like Defective by Design are concerned about DRM?
Weiss: As you know Morpheus is both file and DRM-agnostic. We’re not in the DRM business. If a user encounters a DRM file, that user is obligated to follow the rules of that file. But at the end of the day, DRM may be counterproductive to content owners – it may protect downloads, but it stifles innovation and consumer adoption.
It can be tricky, useless, and create somewhat complicated situations. We’re confident there are other solutions that respect creative rights and make sure artists and other creators and rights holders get paid but do not necessarily involve DRM. However, ultimately it is the content creator that decides if they wish to use DRM or not. The best we can do is to help educate creators and policy makers that there are other options.
Hawkins: You said in April that negotiations failed with the content industry because an outside law firm mucked things up by seeking retaliation, retribution and revenge turning a potential partnership into a one-sided unworkable deal – can you expand on this or offer any details on what was so unfair about the deal they were proposing? You said at the time that it wasn’t a question of money but rather one of terms….
Weiss: We can’t comment at this time since the litigation is active.
Hawkins: I’ve also read that up until now you have spent around $4 million defending yourself over the past five years – is this an accurate figure? Does it take into account the hours contributed by EFF? And, is this where the real danger of the Grokster decision lies – has the uglyopoly (yes I know it’s spelt oligopoly) taken much of the revenue out of file sharing networks – and in turn left them in a position where they can not afford to defend themselves?
Weiss: It’s safe to say we’d have much rather spent over four million dollars on development instead of legal bills defending ourselves, which doesn’t include all of the brilliant work by the EFF team pro bono. The strategy of using litigation as a stick is not the way to solving any problem. It’s time to stop spending money on litigation and start spending it on solutions – certainly suing customers is no solution at all. At Morpheus, we’d rather focus on a mission of technological innovation. Litigation isn’t going to result in meaningful and lasting solutions – the lawyers won’t be the ones to find solutions.
Hawkins: Have you been following the developments in relation to the SIRA legislation? [Let’s leave aside the implications of licensing cached copies for a minute] Is this compulsory licensing step something that could eventually help you, do you think that it could eventually be expanded to include P2P networks like yours or do you ultimately think its only going to serve the interest of the RIAA? Does it only streamline publishing royalties or does it cover sound recording royalties as well?
Weiss: No, I haven’t been following this specific legislation. Let me just say that in principle we’d support any fair and balanced method that streamlines the process of making authorized content available to everyone while respecting the rights of copyright holders.
Hawkins: Are you aware of the new CD swapping service LaLa where users can trade CDs for $1+ postage – I understand the significance of the first sale doctrine in protecting the transfer of title – but does this make the law in relation to file sharing even more ridiculous?
Weiss: Sometimes it’s not about creating new laws, it’s about how current laws are being applied to new technology.
Hawkins: I was following the compulsory licensing debate in France earlier this year – can you explain to me how a fine of €38 (less than $47), where all the money goes to the Government, is better than $15 a month from 12 million people? Is it more a question of control and limiting competition (cultural diversity) than it is about money? Do you take any comfort from recent comments in Sweden about the potential to reconsider a compulsory licensing model?
Weiss: Either compulsory or collective licensing has a proven model in a broadcast environment for over half a century. Both should be looked at as solutions if applied fairly and with balance.
Hawkins: Have you been following the drama in relation to The Pirate Bay? I’ve read that the Supreme Court Kazaa (BV) decision in the Netherlands established that there was no secondary copyright liability in that country – have you ever considered relocating your operation there, or did the USA Kazaa (Sharman Networks) decision obviate the potential there?
Weiss: Yes, we could have located our company in a variety of foreign countries if we thought that what we were doing was illegal. However, we believed from day one that what we were doing was 100% legal and stayed put in the USA to face any challenges head on.
Hawkins: You said in February this year that by the end of summer there will only be two or three p2p networks left standing in the United States, and yet in other countries there have been new and unfiltered networks starting up AllPeers (UK), a new version of Piolet/Blubster – Manolito (Spain) and Tribler (Netherlands), does it bother you other countries may succeed where the US was initially the leader?
Weiss: As an American, it bothers me whenever American technology and development is put at a disadvantage. I hope that our elected officials are listening.
Hawkins: What’s your response to the development of an optional filter by LimeWire?
Weiss: I don’t know if it works and I’m not sure if anyone using it.
Hawkins: I was reading the 2005 music sales data from Germany earlier in the year, and putting aside the drop in sales itself (due to a whole heap of factors not just file sharing), I noticed that a largely overlooked result was the 5% rise in sales of music by German artists – Germany is known as a big file sharing country – does this say something (probably not definitive but maybe as an indicator) about the potential for file sharing to increase cultural diversity and preserve non English speaking cultures?
Weiss: Major media players such as [BMG was not mentioned in the research] Disney, Sony, Warner and Universal will benefit from making their content available over peer-to-peer networks, according to the latest research from Strategy Analytics’ Broadband Media and Communications. Their report concludes that P2P networks will perform a vital strategic role in the media and entertainment industries, which will provide social stickiness and economic efficiencies, as well as supporting a growing number of alternative business models, pricing strategies and legal consumption experiences. This is a position that we have been trying to champion for years.
Hawkins: I was reading with interest about the Coca-Cola StageSide p2p promotional files and was wondering if you could tell me what technology (?watermarks?) the JunGroup are using to track the downloads of those files?
Weiss: Ad-sponsored content is a new business model approach that we certainly support. It just may be one of the best solutions today.
Hawkins: In May Morpheus v5.2 introduced podcast support – how has this been received by users and has there been a positive response to the upgrade of the software?
Weiss: Yes, we are seeing more users and less churn. Our goal is to develop great technology that both leads and responds to the marketplace. We attempt to listen to the consumer and certainly podcasting is something that users are interested in using.
Hawkins: If 70% of files being shared are music, why can’t we have a compulsory license just for music – there are substantially different production costs associated with film and functionality in relation to software, is it reasonable to treat them all the same…?; and if the danger is that 100 million artists will end up with $1 each – can’t we set a threshold so that say only the top 1-500 artists are remunerated from the licensing fund – obviously if every artists were to be remunerated it would fracture the market beyond repair – could even give those that rank higher proportionally different amounts…?
Weiss: Perhaps the best solution is the idea of creating an evergreen revenue stream from global pool of money with everyone – from independent artists to major content providers – actively involved in making sure that the distribution model is fair. We acknowledge that there are lots of moving parts needed to make this a reality. Maybe this is an issue that Congress needs to bring to the forefront and have all the stakeholders – including consumers – work out a voluntary solution under their auspices. (As an aside, I don’t know what percentage of files are music, or what of the music files is not public domain or authorized for distribution via P2P.)
Hawkins: And is there any immediate danger that RIAA will lobby for compulsory filtering…?
Weiss: They already have in the form of last year’s proposed Inducement Act. However, filtering is still in the early experimental stages and hasn’t proven to be effective, including by crippling the elegant nature of pure decentralized peer-to-peer distribution.
Another huge issue is whether technology companies have an obligation to redesign their dual-use technologies to the specifications of copyright owners. The movie studios wanted there to not be a record button on the Betamax, but the Supreme Court said Sony did not need to do that. The Plaintiffs in the Sony Betamax case wanted a broadcast flag that would jam recording, but the Supreme Court said Sony did not need to do that. In the end, that has proven to be the smarter decision.
Sally Hawkin – p2pnet, Australia
[Hawkins is a former musician and songwriter who decided to study law after doing a course in Music Business Management in 1991; she's worked for various departments in the Oz Federal and State Government, holds a Bachelors Degree in Legal and Justice Studies (Criminal Law), a Bachelor of Laws (Honours) and is currently a postgraduate student with Southern Cross University writing a thesis on Copyright Law/P2P File Sharing.]
Digg this story.
p2pnet newsfeeds for your site.
rss feed: http://p2pnet.net/p2p.rss
Mobile – http://p2pnet.net/index-wml.php
June 27th, 2006 at 9:10 pm
Its interesting to read about StreamCast from a perspective other than the Morpheus program…or should I say a more encompassing interview.
Good interview, but I wish p2pnet would hold telephone interviews so Micheal Weiss’ (or whoever) points can be challenged.
June 28th, 2006 at 1:25 am
Wait until Matt the Troll aka Gachnar sees this =)
June 28th, 2006 at 5:51 am
Is this the same Michael Weiss who has denigrated the DCIA for so many years and said p2p united was the only way to go?
June 28th, 2006 at 12:43 pm
Micheal Weiss says that Morpheus will be DRM agnostic but isn’t that like other services that offer MP3s and protected music that have been criticised on p2pnet in the past .
Its up to the content creator\publisher if they want DRM on their content , not the service provider .