December 27, 2000

YEAR-END WORLDWIDE ROUND-UP ON INTELLECTUAL PROPERTY AND THE INTERNET

by Andy Oram
American Reporter Correspondent

CAMBRIDGE, MASS.—In previous Decembers, I have created end-of-the-year columns for American Reporter concerning the year’s most salient Internet policy issue. This year, two issues vie for attention. I covered surveillance in a column published last weekend, and today I will deal with intellectual property.

The very phrase "intellectual property" offends many people heavily involved in Internet policy, so I will look a bit later at the philosophy behind the term. First let’s tour the menagerie of laws, court cases, and regulations concerning copyright and related issues to find some common trends.

At the forefront of reader’s minds, no doubt, are the past year’s lawsuits against MP3.com and Napster for distributing music without the permission of copyright holders. MP3 audio files happen to be at the center of current disputes because their short playing length, imposed either by studio executive fiat or poverty of musical thought, makes them the popular medium most appropriate for storage and transfer with today’s disk space and bandwidth.

The MP3.com and Napster cases are, in one sense, shaky ground on which to start building a new consensus around intellectual property in the digital age. Both sites found it hard to fight the argument that they were engaging in copyright infringement. Their supporters had to resort to deflecting debate toward a millennial "all the old rules are gone" claim that ultimately proved unpersuasive in the courts. Both sites came out losers in initial rulings and scrambled to strike deals with their accusers. The upshot is that the Internet is still following the "old rules," at least so far as businesses are concerned.

It is important, though, to return to the millennial claim. A fundamental battle underlies all the ground-breaking intellectual property disputes on the Internet, including MP3.com and Napster: the question of who can promote innovation. Does the organization that originally provided a work of art or a collection of information get to dictate all future uses of that material? Or can the viewers and customers do things that perhaps were never anticipated and that may add tremendous social value?

That is the question arising from what, for me, is the most disturbing trend in recent intellectual property cases: the trend toward removing the right to hyperlink (create a path from your document to somebody else’s). The Web has made its fortune on hyperlinks. If I want to talk about a good article on the C|NET online news service about the risks of court injunctions against linking, I don’t have to cite the publication and date; I just link to it. Content creators see a hyperlink as a reference, bringing no onus on the person making the link.

Given that hyperlinking one author’s work to another has been the main feature of the Web from its beginning, one would expect a person sinking millions of dollars into a Web-based business to first ask the question, "How would my business model be affected if somebody outside linked to my pages?" But instead, too many waited for the event to occur and then reacted with a hysterical sense of entitlement.

For many reasons, several commercial sites have tried to prevent others from linking to their pages. eBay sued AuctionWatch.com and Bidder’s Edge because they offered comparisons between eBay other auction sites; this embarrassed eBay and threatened to take business from it as the dominant player.

A minor irritant for eBay may have been the ability of customers to look at auctions without seeing the ads on the main eBay page. Since advertising is a major source of income for commercial Web sites, many of their owners react violently when someone else links to their material. This financial concern was the basis for several cases in the United States and England in 1997 (Shetland Times, Ticketmaster, and Total News). All were settled with an acknowledgment that the site making links required permission from the site providing the material.

In a narrow sense, the alarming precedent set by these cases is the notion that links are not references (as most Web authors consider them) but rather the use of facilities provided by the target site. These rulings declare that the target site thus has grounds for refusing the use of its facilities—that is, for refusing links. (In the final ruling for eBay against Bidder’s Edge the judge invoked a hoary old doctrine called "trespass to chattels" in order to claim that Bidder’s Edge was making unfair use of the eBay server’s CPU and bandwidth—an awkward justification for suppressing the right to link.) Even more disturbing is the rulings’ subtle bias toward turning the Web away from education and exploration and making it simply another channel for broadcasting commercial material.

Another, very different, form of pressure restricts the right to link by making the linker party to some illegal act. In Germany, several years ago, a court told a political activist to take down a link to an anarchist site carrying such material as instructions for derailing trains. Once again, the court treated a link in a way it could not have treated a reference in a publication. The person making a link was tarred with the guilt of the site to which the link was made. Recent cases in France and Germany regarding Nazi material have focused on the site hosting the material, but the same laws could easily be deployed against sites simply making links to the material.

Anarchist and Nazi material do not involve questions of intellectual property, but the vicarious guilt behind linking is usually invoked by those claiming copyright infringement. The trend reached its logical extreme this past year in the DeCSS case.

DeCSS is a program with the rather obscure purpose of decoding the encryption keys that scramble movies on DVDs. The practical application of DeCSS is to allow the creation of new, unlicensed devices that display the movies. There should be an obvious link here—this time a mental one—to the theme of this article: allowing innovation from people other than the owners of intellectual property. Basically, DeCSS is a break in the weak link of the chain that allows companies to maintain total control over movies, ranging from the media holding them to the devices displaying them. But the issue has been framed very differently by the companies that make DVDs and the courts that ruled in their favor.

Companies that make DVDs claimed that DeCSS was a mechanism for making illegal copies. In characterizing the technology this way, they succeeded in invoking a section of a comprehensive 1998 copyright bill that prohibited the manufacture and distribution of any device whose "primary purpose" is to defeat a "technical mechanism" like the encryption used on the DVD.

While the technical mechanism section of the law was always controversial and the connection to the goal of DeCSS developers tenuous, a court had no hesitation in ruling DeCSS illegal. This serious constraint on freedom of speech was compounded by a ruling that anyone posting source code for DeCSS was guilty of "distributing" the device, and finally that anyone making a link to a site with the source code shared its guilt.

Those who claim the death of copyright are not the only millennialists in the debate, for the 1998 bill is titled the Digital Millennium Copyright Act. It covers a huge range of issues that can arise as information travels the Internet or settles down into physical media in digital form. The section on technical mechanisms used by copyright holders shows a recognition that nothing they do is completely impervious to cracking. Big studios, database publishers, and software manufacturers are wielding the law in tandem with technical barriers to the free use of their material.

Web sites may legitimately use traditional doctrines, like that of unfair business practices, to limit specific uses of linking. But in striking out to protect themselves, they have brought forth serious distortions in the legal status of the Web. And in preparation for future battles, they are hewing even bigger clubs from the pillars of the law.

One such club is database protection, an idea that caught on first in Europe. It grew out of the fear that companies investing enormous efforts collecting information like legal cases or telephone numbers could have their work ripped off by cheap imitators. But database protection brings with it a tremendous danger: it prohibits the reuse of facts, where copyright protects merely expression.

The recognition that overly loose database protection could essentially remove facts from the realm of public research and debate led the framers of "collection of information" laws to limit the circumstances under which databases are protected and to define characteristics that hopefully separate legitimate use from illegitimate copying.

Unfortunately, finding a clear boundary line is impossible. A law protecting collections of information could conceivably be invoked by Web sites to outlaw links. It would have the potential to hold back many innovative types of derivative applications and data mining, bringing us back to the theme of the article: does the provider of information get to control the use of the information?

While the European Union passed a directive protecting collections of information in 1996, soon to turn up as laws in most member nations, similar laws came up four years straight in the U.S. without being passed. Representative Coble of North Carolina, the bills’ faithful backer, promises to bring it up again next year. It looks like the issue will not go away until Congress passes either the Coble bill or the more modest alternative that was introduced this year.

The accusation of copyright infringement came up on the Internet as early as 1994, when Church of Scientology became notorious for using it to trample the privacy of critics, news publications, Internet service providers, and anybody else who touched Church material. I suppose a religious organization has the right to copyright its teachings. But the right to copyright should always be balanced against the public’s right to comment and criticism. Here, interestingly enough, the Church’s crusade intersects with the business plans of U.S. software manufacturers.

I am referring here, of course, to UCITA, a set of new rules for shrink-wrap licenses. This article cannot possibly explain a proposal that runs over a hundred pages, but suffice it to say that coded and fuzzy wording allowed many risky provisions to survive the criticism of consumer advocates and independent software developers.

Shrink-wrap licenses are not subject to the usual rules of copyright: they need not protect fair use, right of first sale, or even the right to quote from and describe a product for the purpose of review and criticism. In a number of other subtle ways, UCITA allows software companies to restrict consumer choice and avoid liability for problems in their products.

UCITA has been making very slow progress, since it must be passed on a state-by-state basis. Virginia and Maryland have passed it, but the legislatures have either cut back its most controversial provisions or put review procedures in place. It still has a good deal of momentum, though. Many consumer advocates fear that UCITA represents the future of intellectual property, as well as product liability and customer relations in general.

Intellectual property is not limited to copyright or quasi-copyright issues. Some of the other controversies of the past year involve:

Trademarks.

Owners of brands both famous and obscure, once they discovered the Web, became supersensitive about Internet domain names. Numerous people have been sued for using words that companies have trademarked, even if the use is in a totally unrelated field or involves legitimate criticism. The trademark holders are trying to extend the reach of trademark law far beyond its traditional limits, and where they are unsatisfied with their progress (as in ICANN, the policy-making body for domain names) they have succeeded in passing draconian legislation in the U.S. without public debate.

Patents on software and on business methods.

The U.S. Patent Office is supposed to screen out patent applications on obvious procedures, but filers have managed to slip through patents on such things as hypertext links, overlapping windows, and multimedia. Patents weren’t even allowed on software until the 1980s, and the floodgates to business method patents were opened only in 1998. But now there are thousands of such patents granted in the U.S. ever year—and some are being belligerently enforced. Heavy pressure is on the European Union to allow software patents, but they have declined so far to do so, leaving the issue open for the future.

Trade secrets.

These turned up in the DeCSS case, and have been used by other companies as well to protect information that could be used to embarrass them or to undermine their monopoly on use.

And I haven’t even touched on various odds and ends like the attempt of America Online to keep its instant messaging protocols proprietary. It is time, however, to take a broad look at the field of intellectual property.

From my way of stating of the issues, you can guess that in technology I am a prolifer: I support the proliferation of information and new uses for information. Nevertheless, I recognize the value of copyrights and brands and depend on them for my own livelihood as a writer and editor. Thus, this article has tried to build rather than to burn; to foresee a new age of soaring creativity while letting the old system descend to a soft landing.

I am not a freedom-of-information absolutist. If I see a beautiful painting in a friend’s house, I don’t harangue her to leave her home open day and night so the entire public can appreciate it. Why shouldn’t publishers have some say over the use of online information too? The doctrine of author’s moral rights, as understood in the European tradition of intellectual property, is worth respecting: it declares that the author of an illustrious work should not have to watch it edited and twisted by others to the point where it is degraded.

But we are flying quickly toward the other extreme in the way intellectual property is enforced today. Fair use and the right of first sale are being shredded. Middlemen rake in superprofits on popular culture, often cheating the original creative artist even more than the public that pays the tab. And the potential for valuable derivative works is being squashed.

When I see the elaborate technical and legal maneuvers that copyright holders undertake to control their users, it makes me sad. Studios have forgotten the role of the audience in art—forgotten the way that fans themselves created such towering figures as Nicolo Paganini, Judy Garland, or Elvis. The modern view of artistic expression seems to exclude the audience entirely, to the point of artistic solipsism. The artist deals with the studio, and the result is a static work disseminated to a purely passive audience. Despite companies’ cynical manipulation of the public for "buzz" and "viral marketing," they want nothing new to come from the outside.

And therein lies my discomfort with current notions of intellectual property. I do not disparage the term itself, but the exploitation of the concept to freeze what should be fluid. Let alone the excessive glorification of information as the basis of our economy and society.

While I respect and love many works of art and culture, I see their role change as they interact with their viewers. To me, information is far too precious to hold on to it.


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