Do we need a new copyright law?
While the Internet has unquestionably increased the amount of information that is available as well as the speed with which it can be accessed, certain recent technological innovations have complicated this advantage. Easily accessible information now includes a wealth of copyrighted material: songs, films, books, articles, drawings and designs. While innovation has historically threatened ownership and reproduction rights, the market for new products itself has generally resolved any conflict and laws have adapted. In relation to the Internet, however, the issue of protecting intellectual property will likely rise to the U.S. Supreme Court.
One of the focal suits revolves around Napster Inc., a company that provides a free Internet tool that enables users to find and download songs in digital format (specifically, MP3 format). Most of the songs are copyrighted. Because users procure the files for free, owners of song rights -- the artists or their record labels -- claim that Napster users are stealing the recordings. The Recording Industry Association of America (RIAA), which represents the major record labels who in turn represent individual artists, has filed suit against Napster. The RIAA is accusing the company of enabling mass copyright infringement. Essentially, the RIAA is defending the artists' monopoly power over their copyrighted materials.
On July 27, 2000, Chief Judge Marilyn Patel of the U.S. District Court in San Francisco granted an injunction that required Napster to bar its users from downloading copyrighted songs. In large part, the injunction was based on the finding that Napster does indeed encourage mass copyright infringement by allowing reproduction of material beyond the scope of typical "fair personal use." Four days after the court's decision, Napster won a stay against the injunction until the company could appeal. The appeal is scheduled for late September.
The Napster case as well as the recommendations of the U.S. Copyright Office are expected to be the formative legal precedents for protecting intellectual property on the Internet. Decisions from both are expected before the end of 2000, unless the Napster case moves to the Supreme Court, which could delay a decision for a matter of months or even years.
Napster is a free, peer-to-peer, file-sharing software application. In essence, a user downloads the software from the Napster site. The user then invokes the software to search Napster for songs that he or she wants to download to their own computer. The songs are stored in the digital MP3 format on the computers of other registered Napster users, or peers. In order to simplify the searching of peer computers for desired files, Napster maintains a database of MP3 files that its users have available for copying. Once a song is downloaded, the user can not only listen to the song, but with a CD burner, can copy the song onto a CD and distribute it offline.
Several services similar to Napster are also in existence and, like Napster, all are defendants in lawsuits filed by artists, the RIAA and/or the Motion Picture Association of America (MPAA): (2)
The U.S. Copyright Office has overseen registration and cataloguing of books, music, movies, architectural drawings and any other creative works since 1897. The office is a department of the Library of Congress. The idea of copyrighting was laid out in the Constitution and delegated to Congress the power to "promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries." (3) The first copyrights granted owners rights over their material for up to 28 years. Current copyrights last for 70 years past the creator/holder's death and give the creator/holder rights to reproduce and distribute a registered work or to license those rights to someone else. (4)
The principles of the copyright laws were based on protecting property from physical copies. However, the laws have been interpreted and applied over the years to cover the less physical copying of items such as software. Notably, judgements in these cases more often hinged on the reproduction of the "look & feel" of copied software rather than on the straight copying of the actual code. Also notable is the fact that the Copyright Office has the power to decide which classes, or categories, of materials may be exempt from laws that make it illegal to deliberately break codes or passwords in order to copy property.
A key issue in the judge's July 27th ruling in the Napster case revolved around "fair personal use." While technically the law prescribes that reproducing any protected material is illegal, interpretations have historically allowed leeway for personal use rights. For example, the court would not convict an individual who made a tape of a CD for use in his or her own car. The judge in the Napster case resolved that the use of Napster does not fit the description of typical personal use due to the scale of reproduction that is possible.
There are three significant legal precedents that have and will likely continue to figure into the evolution of intellectual property laws. First, in the 1908 case of White-Smith Music Publishing vs. Apollo, the U.S. Supreme Court decided that Apollo, a manufacturer of rolls for player pianos, was not infringing on White-Smith's music copyrights. The justices stated that Apollo was making machinery, not music. The case prompted Congress in 1909 to expand copyright law to cover technological advances such as piano rolls and the phonograph. (5)
Later, in the early 1930s, radio broadcasters stopped playing any copyrighted music for two years until they were able to reach a legal settlement with the recording companies. The upshot of the settlement was that the broadcasters were forced to pay royalties for every copyrighted song played on the airwaves.
Finally, in 1984, the U.S. Supreme Court handed down a decision in favor of defendant Sony Corp. In 1976, Universal City and Walt Disney studios filed suit against Sony claiming that the company's Betamax video-recording system was routinely used to violate copyrights since users could tape movies from their television sets. The justices concluded that most Betamax owners used the device simply to watch TV programs at a more convenient time and that this usage fell within the "fair personal use" parameters of the law. Since that decision, Hollywood studios have reaped greater profit from their monopoly power over movie titles because videotape sales have provided a revenue stream that was not previously available to the film industry.
The argument made by the RIAA and the MPAA is that the creators and producers of the intellectual property being freely traded on the Internet are being denied the profits due to them on those reproductions. Significantly, Napster Inc. was incorporated in May 1999 and to date has not developed a revenue model based on its software. Thus, the remedy for protecting intellectual property on the Internet should obviously be one that allows all parties involved to receive compensation for their part of the distribution.
Most pundits and commentators on the issue propose schemes whereby users pay a fee based on one of the following schemes: (7)
An important element in pricing digital content is to dissuade piracy by establishing a very low price. It is equally important that to enable the relevant parties to receive revenue, reproduction via the Internet must be made illegal. An crucial provision of the 1998 Digital Millennium Copyright Act goes into effect this Fall to address this specific need. The provision will make it illegal to break through passwords, encryption and any other technical defenses erected around content.(8) Recording studios and filmmakers have already begun to use "watermarks" and other encryption technologies in order to release digital versions of their content.
Complex rights management software applications do currently exist, namely MS Document Rights Management System, Softblock, and PDF Merchant. However, hackers typically are able to break encryption devices such as these applications by intercepting the decrypted files as they pass from the central processor and the sound and graphics processors that prepare for display. For instance, a 16-year old Norwegian boy used this technique to crack CSS, which is the security device on DVD's. His program, deCSS, is now at the heart of the process that allows DVD's to be turned into DivX files. (9)
Two important upcoming events will likely set the tone for copyright protection on the Internet. First, in late September the Ninth U.S. Circuit Court of Appeals in San Francisco will hear arguments in Napster's appeal to the July 27th judgement against it. Because the court plans to expedite the matter and render a decision by early October, the loser of the appeal would then have time file a petition for the current session of the Supreme Court. (10)
Secondly, Congress has mandated that the U.S. Copyright Office arbitrate the process by which content suppliers and Internet distributors set the royalty rate that the webcasters will pay. In late fall, the head of the Copyright Office is expected to send her final recommendations to the Librarian of Congress, who oversees the Office. He will make the final decision on the rates. Notably, federal laws prohibit the personal lobbying of any Copyright Office and Library of Congress officials.
Written by Mary Murphy under the supervision of Luis Cabral.
(1) "Say You Want a Revolution?" The Wall Street Journal, June 20,
2000, p B1.
(2) Megan Barnett and Ben Hammer, "Download This," TheStandard.com,
July 27, 2000.
(3) Scott Harris, "The Piano-Roll Precedent," TheStandard.com, August
7, 2000.
(4) Anna Wilde Mathews, "How the Web Yanked Obscure U.S. Agency into
Legal Limelight," The Wall Street Journal, June 14, 2000, p A1.
(5) Scott Harris, "The Piano-Roll Precedent," TheStandard.com, August
7, 2000.
(6) Tom Foremski and Andrew Heavens, "Napster on the Ropes in Copyright
Fight," Financial Times, July 28, 2000. P. 6.
(7) Don Clark and Martin Press, "Can the Record Industry Beat
Free Web Music; Music Companies Fight Back, Hoping Downloads for Fees Can
Prove as Popular as Free," The Wall Street Journal, June 20, 2000. P. B1.
(8) Anna Wilde Mathews, "How the Web Yanked Obscure U.S. Agency into
Legal Limelight," The Wall Street Journal, June 14, 2000, p A1.
(9) Paul Talacko, "The Key to Copyright Harmony," Financial Times,
July 28, 2000, p 12.
(10) Lee Gomes, "Napster Appeal Is on Legal Fast Track After a Stay
That Delayed Closing Site," The Wall Street Journal, July 31, 2000.