Slashdot on the MPAA’s “Refined” Strategies

As a followup to The MPAA Plays “Softlee Softlee Catchee Monkey”,we get this Slashdot discussion: MPAA Fights Pirates with Gentle Threats — see, in particular, Read between the lines

Everybody reading the article needs to read between the lines pretty carefully on this one. While the MPAA is seemingly offering the olive branch with one hand, look at the following quotes from the article:

Along with the warning letters, the movie industry is paying for consumer education programs and technology research, and pushing for laws and regulations that executives hope will protect their wares.

The most important thing for Hollywood to do now, Johnson said, is to move faster to develop the kinds of licensing agreements and protective technology

The path to a successful service has to involve the kind of technology that protects copyright unobtrusively,

Hand in hand with developing legal digital services, he recommends the kind of tough security that is built into satellite television equipment,

This whole article reeks of DRM. They never mention it by name, but this is exactly what they have in mind, and some of the stuff highlighted above suggests DRM in hardware.

So I don’t see where the MPAA has learned a damn thing, other than the blatant tactics of the RIAA don’t work so they’re going to try more underhanded ones. The agenda of the MPAA has NOT changed one iota.

Judge Kaplan of 2600 Fame Back On Slashdot

There’s an article on Slashdot today, Court Rules Against Photographers in Copyright Suit, based upon an article in Photo District News Online, NGS Beats Infringement Rap in New York. Essentially, a set of photographers sued the National Geographic Society over their distribution of a CD of issues of National Geographic without compensation.

The photographers were relying upon an 11th Circuit decision, Greenberg v. National Geographic, but Judge Kaplan, noting that NYTimes v. Tasini had been decided subsequent to the 11th Circuit decision and using a different theory of infringement, elected to review in light of that decision, and concluding that a CD of page scans, even with an index, is not a new work, so the earlier agreements to publish still held.

Here is a link to the case — Faulkner et al. v. National Geographic. The route taken to deciding the review the materials rather than rely upon Greenberg is worth a look.

The issue tendered by defendants — whether the [Complete National Geographic] CNG is a “revision” within the contemplation of Section 201( c) — requires construction of the 1976 Act in a new technological context. The question is whether a print publisher of a collective work is privileged to use the individual contributions in a digital version where (a) the individual contributions are presented in the same contexts in which they appeared in print, and (b) the digital version contains also software or other materials that did not appear in the print version. This issue is one of substantial importance to the development of copyright law and to its impact on the dissemination of knowledge. The Second Circuit, to which any appeal here would be taken, of course is a jurisdiction coordinate to that of the Eleventh Circuit. In the event of a circuit conflict, the matter likely would go to the Supreme Court. A decision on the merits here thus would promote the development of the law on this important point. [slip op. page 21]

[…] Greenberg resolved the revision issue by looking to the question whether the CNG contained independently copyrightable elements in addition to the previously published collective works, i.e., the Magazine. Tasini took a different approach. It focused instead on whether the individual contributions appeared in the putative revisions – the electronic databases – in the same contexts in which they appeared in the original collective works. Moreover, its reference to the microform analogy has significant implications for the CNG. Accordingly, while it perhaps is possible, as a matter of formal logic, to reconcile the holdings of Tasini and Greenberg, the difference in the Supreme Court’s approach to the revision issue nonetheless is striking. [slip op. page 23]

[…] This Court is convinced, both as a matter of law and in the exercise of discretion, that application of collateral estoppel to foreclose defendants from asserting that the CNG is a privileged revision of the Magazine would disserve the public interest in having the important issue presented here resolved definitively and would be inequitable. It therefore holds that defendants are not foreclosed on the revision issue by Greenberg.

The case upon which the photographers were depending is Greenberg v. National Geographic (some background information from some Wired News articles when the case was up for cert: Mr. Tasini, Meet Mr. Greenberg and Magazine Appeals for CD Archive)

The MPAA Plays “Softlee Softlee Catchee Monkey”

But will it really work in the long run? While these industries grasp for control harder and harder, it appears that some are ready to opt out altogether. This NYTimes article tries to paint a reasonable picture, but only devotes a sentence to the key point: In Chasing Movie Pirates, Hollywood Treads Lightly

While the recording industry has made headlines with a few hundred lawsuits, the movie industry has been sending out hundreds of thousands of threatening notices via e-mail messages each week to the people who make its products available on the Internet.

The music industry’s approach has contributed to a decline in downloading but has also produced a powerful public backlash, angering millions of its customers. That is one reason, among others, that Jack Valenti, head of the Motion Picture Association of America, said that his industry would not be following the music companies’ path any time soon.

“I’m not ruling out anything, but at this moment we don’t have any specific plans to sue anyone,” Mr. Valenti said. “I think we have learned from the music industry.”

The gentler threat works, said Mark Ishikawa, the chief executive of BayTSP, a company that helps the industry track down file sharers by scanning the Internet for movies and issuing the e-mail notices automatically. Fully 85 percent of those contacted “do not come back,” Mr. Ishikawa said. “We never see them again,” with no headlines and no public relations blowups.

[…] Mr. Valenti says Hollywood is doing everything it can to get ahead of the coming storm. Along with the warning letters, the movie industry is paying for consumer education programs and technology research, and pushing for laws and regulations that executives hope will protect their wares. At the industry’s urging, for example, California recently passed a law making it illegal to use a camcorder in a movie theater.

Yet experts in digital technology say Hollywood is fooling itself if it believes that its current steps will be enough, or even that they will take the industry in the right direction.

[…] What the industry needs, technology executives say, is to look harder for tools and contracts that allow people to get the movies they want at a competitive price, rather than concentrate on actions that restrict access. [emphasis added]

[…] The costs of adopting the wrong strategy will be high. Jeff, the movie swapper, says that despite his scare he has not changed his ways. He has gone deeper underground instead, renaming files so that movie titles would not be as easy to find with industry search software, he said. (Mr. Ishikawa of BayTSP said that the strategy would not work against his service, however.)

Jeff also says that he does not make his own trove of movies available to the world as readily. “I just watch them and delete them instead of leaving it out there,” he said. “I don’t leave the network on 24 hours a day the way I used to.”

But Mr. Davis, the former song trader, has changed his habits. He dusted off his turntable, bought a new needle and started haunting the bargain vinyl bins in junk shops, where he has discovered some treasures for a dollar a record.

“I’m really very excited about it,” he said, “because there isn’t much new to buy out there, is there?”

See this followup: Slashdot on the MPAA’s “Refined” Strategies

Some Economics of Digital Movie Distribution

From Reuters via Yahoo!: Coming to a Theater Near You: Digital Films [gotta make a PDF]

The biggest advantage for the moviegoer, says Peter Wester, project manager for Swedish cinema chain Folkets Hus och Parker, will be most visible not on the marquee — not necessarily the screen.

A cinema can download a digital version of the film on a computer hard drive and show it as long as the audience shows up. No longer are theaters bound to the major studios’ distribution schedule, he said.

“The average rise of income for us is 25 percent after one year,” he added.

It can cost thousands of dollars for a cinema to get a Hollywood blockbuster film at or near the release date. A theater operator, therefore, often has little choice but to show the movie as often as possible before returning it to the distributor.

A digital version, because it can be easily reproduced, shipped and stored, costs less than $20 per copy, according to cinema exhibitors. It also allows the cinema operator to free up their viewing schedule, perhaps opening up the odd week-night slot for an art-house title.

And, the build-out is expensive. It costs a cinema operator an estimated $125,000 for the equipment and installation of a digital projector and server. The costs are decreasing, with widespread roll-out expected to halve deployment cost.

The biggest obstacle though is Hollywood. The Walt Disney Co., through its partnership with Pixar Animation Studios Inc. (Nasdaq:PIXR – news), and Warner Bros. (NYSE:TWX – news), are the only studios producing blockbusters in digital film.

Slashdot’s Discussion of the Internet Law Year In Review….

… Has some pretty interesting comments. (see this FurdLog post for the original article URL.)

  • From One year is not enough. Look back at the last ten

    While everyone’s caught up looking at the trees, here’s what’s happening in the forest: We’re inching ever towards limiting the common man’s access to “intellectual property” (whatever that is). In doing so we’re walking away from the past five hundred years of intellectual freedom brought about by Johannes Gutenberg and Martin Luther.

    This is a huge, gigantic assault on the philosophy of the Enlightenment, on which (to some extent) our country was founded and our Constitution based. Yet my impression is that most comptuer geeks only see the tip of the iceberg –e.g. “I can’t legally play my DVDs on Linux” or “ROT13! WTF J00 AD0B3 LAM3RZ!” The strongest fight is coming from librarians. I think librarians are the only ones to realize that, were libraries to be invented today, they would promptly be sued out of existence by the RIAA for illegal filesharing.

  • Re:At one time

    It’s going to be really, really disturbing, though, when we all wake up and find out that we can’t run our “popup blockers”, use our blacklists, and filter responses through proxies anymore. It’ll be “made illegal” to alter the contents of packets that we receive from the Internet because of “intellectual property” bogosity.

    It’s going to be even more disturbing when we all wake up and find that none of us have “root” access on our computers anymore. All our packets on the Internet are going to be authenticated and cryptographically “secured” (i.e. “secured” from US), and the content publishers and distributors will hold all the keys.

    I may be overly pessimistic now, I guess, but I feel like we can’t stop it. The Internet, as we know it now, is going to be gone sooner rather than later. There will be “other internets” that will be similar to this one, but the age of a single, unified, global Internet is going to pass quickly, and idiotic legislation, content publishers and distributions, and “intellectual property” are going to be the forces that break it apart.

A Slowdown In Broadband Deployment

According to the latest statistics [pdf] reported by the FCC, the rate of broadband deployment in the US declined in the most recent reporting period (press release, InfoWorld report). From the InfoWorld article:

Monday’s FCC report doesn’t go into the policy implications of the rate of broadband growth, said an FCC spokesman. But the FCC and some members of the U.S. Congress continue to promote broadband to U.S. residents, and in April, the FCC’s Technological Advisory Council attempted to examine why more U.S. residents weren’t buying broadband. Among the reasons discussed then were cost and the lack of applications that needed broadband.

(I like the plot to the right, taken from the FCC report. You can see population centers, of course, but I really like seeing the formation of BAMA right before my eyes.)

The Question On Everyone’s Mind

And not just because of the DVD ruling — recall the words of the DC Court of Appeals in the Verizon decision: Will DVD acquittal mean tougher copyright laws? (Note that this is a VERY extensive writeup!)

Even before the Norway case was filed, however, entertainment industry lobbyists had been pressing lawmakers in that country and elsewhere to enact tougher copyright laws, modeled on controversial U.S. legislation that makes it easier for authorities to win prison terms for people who crack encryption schemes or distribute cracking tools. If enacted, proposed legislation in Europe, Canada, Australia and Central and South America would soon hand entertainment companies similar weapons against people caught tinkering with anticopying software.

That’s raising warning flags from some critics of the U.S. legislation, known as the Digital Millennium Copyright Act (DMCA), who contend the law protects content owners at the expense of consumers and software experimenters. Now, they say, that law is being exported around the globe with little debate.

“It is interesting that the court said Johansen had not broken any law, but the laws are changing,” said Robin Gross, executive director of IP Justice, a nonprofit group that opposes the DMCA.

Certainly legislation will be promoted — the issue will be how to mobilize to articulate just what’s wrong about the way they are framed.

It’s Not Just Music

As this article shows, the windfalls of digital distribution suggest a realignment of interests and economic power in the entertainment business — and there’s no reason that the artist can’t participate in that: A ‘Seinfeld’ Star Will Do the DVD but Asks for Pay.

“I’m not boycotting,” Mr. [Michael] Richards, who played Kramer in the series, said in a telephone interview late Monday night. “I’m involved. I was never called to do an interview. I am so for the DVD coming out that I’ll go on the `Tonight’ show.”

But Mr. Richards said he thought he ought to be paid for taking part in the DVD project, in part because the show has been such a windfall for its creators, producers and distributors: Jerry Seinfeld, Larry David, Castle Rock Television and Columbia TriStar Home Entertainment. They will all share profits from the DVD.

Actors do not typically receive residual payments for DVD’s, but this is quickly becoming a major issue in Hollywood, as DVD sales now bring in millions of dollars to those who control the rights to hit television shows and movies, far more than revenue from videocassettes.

Mr. Richards said: “I innocently asked a question. Is there some compensation? I don’t believe there is. There isn’t anything.”

See, It All Worked Out In the End, Didn’t It?

Statement by Assistant Attorney General R. Hewitt Pate Regarding the Closing of the Digital Music Investigation – (CNet News article: DOJ closes Net music antitrust scrutiny)

“The Division’s substantial investigation of pressplay and MusicNet has uncovered no evidence that the major record labels’ joint ventures have harmed competition or consumers of digital music. Consumers now have available to them an increasing variety of authorized outlets from which they can purchase digital music, and consumers are using those services in growing numbers.

“None of the several theories of competitive harm that the Division considered were ultimately supported by the facts. The Division found no impermissible coordination among the record labels as to the terms on which they would individually license their music to third-party services. The development of the digital music marketplace similarly belies any concerns that the record labels used their joint ventures to stifle the development of the Internet music marketplace and to protect their present positions in the promotion and distribution of prerecorded music in physical form.”

From the Background information from the DoJ we get this summary:

The Division considered in its investigation whether the major record labels used their joint ventures to suppress the growth of the Internet as a means of promoting and distributing music, in order to protect their present positions in the distribution of music on physical media, such as CDs. Proceeding collectively could have allowed the major record labels to explore the use of the Internet to promote and distribute their music, without relinquishing control over the pace and direction of those activities.

The poor quality and restrictive nature of pressplay’s and MusicNet’s services at launch in December 2001 provided some support for this theory. As time passed, however, both joint ventures released improved and more consumer-friendly versions of their services, and the major labels licensed their music to a broader array of third-party music services that compete on price and features. Consumers can now download individual songs from broad music collections offered by at least five such services, and might soon be able to choose among a dozen suppliers. The Division concluded from those developments that the major labels are not impeding the promotion and distribution of music over the Internet.

So, think about the recent reviews of the e-music services and see if you can reconcile them with the DoJ’s conclusions. And let’s not even go into the question of what the record companies were up to in the days before pressplay and MusicNet even existed (Napster, MP3.com and others — see John Alderman’s Sonic Boom) Or, for that matter, the ruinous business models that the emusic retailers operate under.

Then, ask yourself the following question: how do we reconcile the desire to achieve competitive markets through the application of conventional processes and investigative techniques in an era where things happen on Internet time? Particularly when our justice system lately seems to be organized around the idea that, as long as an earlier crime can be rectified with actions that yield no apparent net economic damage, then there’s nothing to prosecute (c.f., Halliburton’s gasoline price-gouging being resolved by asking for the difference between the charged price and the fair market price, rather than seeking some kind of deterring punishment?)

Bah! Humbug! Be interesting to see how much of the record of this investigation becomes public.

Update, Dec 25: the Slashdot discussion, interestingly enough, is about exactly the same issues I snarled about here — DOJ Drops Online Music Antitrust Investigation