Archive for April 2006
Is Open Source DRM Better Than Regular DRM?
This question has been batted around in the press for the past week. In a way, the fact that the question is being posed at all is remarkable, because it signals that the digital rights management debate has begun moving into wide public discourse after a long period in which only geeks and lawyers even knew the proper meaning of the acronym DRM. This article outlines the rise in DRM’s Q Score among regular media consumers over the past five months, and discusses Sun Microsystems’ Open Media Commons.
Among people who follow copyright issues, DRM (or “copy protection”) has been controversial since Congress changed U.S. copyright law in 1998 to illegalize any attempt to circumvent, crack, or hack past “a technological measure that effectively controls access to a [protected] work” (See Section 1201 of the Copyright Act.) Various parties have complained about the anticircumvention provisions of the Digital Millennium Copyright Act since they were enacted into law in 1998; the complaints continue now, as the Copyright Office as it holds its third rulemaking proceeding on the practical effects of Section 1201’s anticircumvention provisions.
Much of the DRM debate, however, has found a limited audience. Copyright lawyers discussed the issues surrounding DRM and anticircumvention because of the Digital Millennium Copyright Act. Companies with extensive copyrighted holdings, seeking to protect their digital assets, discussed DRM as a business and security issue. Finally, scientists and computer technologists whose work was affected by DRM or the DMCA (such as Princeton’s Edward Felten) discussed such issues. But this limited audience was not nearly broad enough for DRM to become a consumer rights issue.
Smithsonian Deal With Showtime Restricts Archives Access
Why has the Smithsonian Institution, whose mission is to increase and diffuse knowledge, cut a deal with Showtime Networks that gives the cable broadcaster near-exclusive use of the Smithsonian’s archives? The deal effectively hands control of the Institution’s archives to a private company.
According to Tuesday’s WashingtonPost.com report, the deal essentially gives Showtime right of first refusal over any broadcast or film work that may accrue from a person’s research. “Jeanny Kim, the vice president for media services at Smithsonian Business Ventures, said the filmmakers who were doing ‘more than an incidental treatment’ of a subject mainly from Smithsonian materials or wishing to focus on a Smithsonian curator or scientist would first have to offer the idea to Smithsonian/Showtime. Otherwise, the archives could not be used outside the realm of news programs (such as “60 Minutes” and “Dateline”) in most cases.”
Showtime is owned by CBS Corporation, which also owns UPN and broadcast television syndicator King World (which owns and distributes The Oprah Winfrey Show).
A deal like this does not come together overnight. I wonder how this deal flew under the radar for so long that its existence didn’t come to light before the parties signed a contract. A quick browse of the Smithsonian’s press section offers no news about this deal. In fact, the press paid little attention to the announcement last month of the Smithsonian-Showtime “video on demand” (VOD) channel.
Jacqueline Trescott. Smithsonian Deal With Showtime Restricts Access By Filmmakers. WashingtonPost.com. April 4, 2006.
See also:
Edward Wyatt. Smithsonian-Showtime TV Deal Raises Concerns. The New York Times. March 31, 2006.
Anthony Crupi. Showtime, Smithsonian Launch VOD. MediaWeek. March 8, 2006.
Updates:
The Washington Post. The Nation’s Attic (Editorial). April 24, 2006.
Jacqueline Trescott. Smithsonian Investigating Its Sales Division’s Salaries. WashingtonPost.com. April 19, 2006.
Jacqueline Trescott. Ken Burns Gives Voice to Filmmakers’ Concerns. WashingtonPost.com. April 19, 2006.
Jacqueline Trescott. End Smithsonian-Showtime Deal, Filmmakers and Historians Ask. WashingtonPost.com. April 19, 2006.
Carl Malamud. Dear Secretary Small. Center for American Progress. April 17, 2006.
Center for American Progress. Letter to Secretary Small from 215 Concerned Citizens. April 17, 2006.
if:book. Corporate Creep. April 6, 2006.
CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.
Big Music Wants to Increase iTunes Pricing
What do you do when a company creates a device that is so popular that it hands you a market that almost beats free? You get greedy and seek to raise prices. This is what is happening right now as the recording labels renegotiate iTunes license fees with Apple Computer and Steve Jobs.
To review briefly, the music industry has been unable to give away its music — even legally — for the past decade. In fact, hundreds of thousands of folks preferred to swap music (legally and illegally) online in various fora, including the download networks Napster and Grokster. The industry’s lawsuits didn’t stop free downloading, nor did Big Music’s feeble attempts at creating their own online marketplaces.
Then in late 2001, Jobs and Apple rolled out iTunes and the iPod. The response to both was so universally positive that even recording artists were pleased. (I recall reading Dr. Dre saying “Somebody finally got it right.”) in February of this year, Apple celebrated its 1 billionth download from the iTunes music store. At 70 cents per track (the approximate amount the labels share in fees for each 99 cent iTunes download), that means Apple has handed Big Music a market that is worth nearly $1 billion.
Again, before iTunes, Big Music had nothing more than dry hands and queasy stomachs when it came to online music.
Now, according to an Associated Press report, “some labels feel hamstrung by Jobs’ insistence on pricing all tracks at 99 cents. With the labels expected to enter into music licensing discussions with Apple this year, any moves by Apple to abandon uniform pricing will test whether music fans are willing to pay more to download music that many only a few years ago acquired for free.” Instead, Big Music wants to impose a pricing structure that mirrors how it sells CDs.
Here’s the problem with that: Big Music no longer seems to be able to sell its own product successfully. One of the reasons iTunes is so successful is it allows people to buy singles, which the music industry eliminated because it wanted to force consumers to buy (higher-priced) entire albums. But people (especially young people) did not want to pay nearly $20 for 20 tracks, 16 of which usually were filler. Instead, people either didn’t buy or shared files online.
And let’s not even discuss Big Music’s gambits like the Sony BMG rootkit scandal, which lead to a class action lawsuit and settlement over the label’s dangerous use of virus-inviting software in a DRM scheme implemented on several CDs. Say what you will about Apple’s FairPlay DRM: thus far, it has not been found to be a computer security risk
Now, Big Music wants to move past a proven 99 cent price point in order to get more money from a business that has proven it can sell music better than the labels. I can’t understand how these people stay in business.
Associated Press. Music Labels, Apple Divided Over Pricing As Talks Approach. SiliconValley.com. April 3, 2006.
CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.
Trademark Keyword Cases Reach Different Results
Several outlets over the last few days have discussed a pair of federal cases that analyze the trademark implications involved in using ad keyword systems on major search engines. The U.S. District Court for the Southern District of New York issued the most recent decision, in Merck v. Mediplan Health Consulting.
Last year, pharmaceuticals giant Merck sued several Canadian online pharmacies for trademark infringement, trademark dilution, and a state claim of false advertising. Merck alleged the pharmacies had used the company’s ZOCOR trademark on Web sites and in ad keywords. (Zocor is a drug used to lower cholesterol.) The defendants moved to dismiss the trademark infringement claim because it did not constitute trademark use in commerce.
According to Marquette law professor Eric Goldman, the Merck court concluded that keyword purchases are invisible to consumers and therefore do not constitute a trademark use in commerce. As a result, the defendants are able to dispose of the claims over the keyword purchases on a motion to dismiss.
One of the reasons this decision is significant is because the Southern District of New York (and by extension, the Second Circuit) is one of the most influential courts in the country on intellectual property cases.
The other case is Edina Realty, Inc. v. TheMLSonline.com, in which the District of Minnesota determined that there was enough of a likelihood of trademark infringement to move the case forward to trial. This result is fundamentally opposite from the holding in the Merck case.
Elinor Mills. Ruling Adds To Confusion Over Legality of Keywords. News.com. March 31, 2006.
See also:
Eric Goldman. Keyword Purchases Not a Trademark Use — Merck v. Mediplan Health Consulting. March 31, 2006.
43(b)log. Important Keyword Decision from SDNY. March 31, 2006.
Eric Goldman. Competitor’s Keyword Ad Purchase May Be Trademark Infringement — Edina Realty v. TheMLSonline. March 29, 2006.
CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.
Big Film To Offer Movie Downloads
The New York Times and several other outlets reported Monday that the nation’s six major movie studios are planning to sell first-run movies online. Prices are reported to be in the $20 to $30 range. Details are available below from the sources we’ve listed.
What I’d really like to know is the following:
- What kind of DRM will the studios use to lock up their content?
- Will the studios all use the same DRM scheme?
- How quickly will someone find a way to break it? (This is a matter of “when,” not “if”)
- How will the studios react when the DRM scheme is broken?
- Who will pay $20 to $30 per download (the price listed in the Times story) for something he doesn’t own, especially when a typical new release DVD can be purchased for $15 to $22 at most retailers, including Best Buy and Amazon.com?
Saul Hansell. At Last, Movies to Keep Arrive on the Internet. The New York Times. April 3, 2006.
See also:
ArsTechnica. Legal Movie Downloads Come to the U.S., But Limitations Abound. April 3, 2006.
Rachel Rosmarin. Studios Take First Step In Movie Downloading. Forbes.com. April 3, 2006.
Updates:
Copyfight. Decoding the Drivel. April 4, 2006.
CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.
Sony BMG Rootkit Discussed At DMCA Rulemaking Hearings
The Sony BMG rootkit scandal was front and center at the current DMCA rulemaking hearings in Washington, D.C. News.com reported that despite the scandal, which led to a class-action lawsuit against Sony BMG and a recall of compact discs that contained the harmful code, members of the content community testifying last week insisted that the DMCA’s anticircumvention provisions must remain unchanged.
The purpose of the hearings is to determine “whether there are particular classes of works as to which users are, or are likely to be, adversely affected in their ability to make noninfringing uses due to the prohibition on circumvention of access controls.” Testimony was heard last week on March 29 and March 31 in Washington, D.C. Today is the final day for public testimony in Washington, D.C.
Anne Broache and Declan McCullagh. Seeking Changes To The DMCA. News.com. March 31, 2006.
See also:
U.S. Copyright Office. Rulemaking on Exemptions from Prohibition on Circumvention of Technological Measures that Control Access to Copyrighted Works. No date.
CopyCense™: K. Matthew Dames on the law, business, and technology of digital content. A business venture of Seso Digital LLC.
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