How to stop piracy?

I think that everyone can agree that one of the problems with piracy is that it may have negative effect on some musicians. There is evidence that the music industry has become more reluctant to sign new acts and is relying on old names to stay afloat; and some small and medium artists have seen their works pirated indiscriminately. While we have become immune to pleas against music downloading from big names in the industry, it seems like the new marketplace is in turmoil. for example, CD sales continue to drop in the States, while they seem to go up in the UK. Similarly, P2P seems to affect established names, while it may benefit smaller acts. Meanwhile, Radiohead continues to innovate with their forward-thinking delivery methods.

What to do? It seems evident that the big stick strategy is not working. P2P enforcement is uneven, it has not stopped infringers, and most importantly, it seems to be targeting innocent users. Similarly, DRM is not the solution (mini-rant: whoever thought that DVD regions were a good idea? I had to spend hours hacking my MacBook's DVD protection to watch a legitimately purchased copy of War Games!).

One thing is clear to me. While in Costa Rica, I have been struck by the vibrant local music industry. Some artists are doing reasonably well for the market, including the amazing Malpaís. While this group is very popular with the download generation, their records are selling remarkably well. Apparently, buying th record has become an important part of being a Malpaís fan. The solution then has not been one of enforcement, it has been one of social awareness. I put forwrd then that the solution to piracy is to empower the consumer, just like Radiohead is doing. There are other schemes to invest in new bands, proving that the solution is in empowering the fan base.

I'm a bit tired, so I will not be issuing a pithy one-liner today.

Internet memes against copyright term extension

I found this wonderful timeline of Internet memes yesterday, so many happy memories of hours wasted in front of a YouTube screen... but I digress. I have been frustrated by the seemingly unstoppable war on evidence waged by copyright policymakers, a frustration made worse by the nagging certainty that there is nothing we can do to stop term extension. However, watching those internet memes got me thinking about the power of the Internets in conveying ideas in a fun and viral manner.

Therefore, I would like to suggest that we unleash the power of memes in service of the copyfight. Do you oppose term extension? Kill a Mentos! Record it, upload it, blog about it, Facebook it, Flickr it, Twitter it.

I'm off to the shops to buy some diet soda and some chalky mint sweets.

Evidence-based copyright policy? No thank you!

Some years ago, James Boyle made a compelling case in favour of evidence-based policymaking in an article attacking the European database right. Since then, I have become a strong believer in injecting some empirical evidence into copyright debates that are often filled with anecdotes of starving artists, scaremongering tales of decreasing sales, and misleading myths about the creative industries.

Back in July the EU Commission decided to support term extension for copyright in sound recordings despite all the evidence to the contrary. In the truest and finest tradition of evidence-free decision making, the Commission has used a tried and tested collection of baseless soundbytes to support their choices. The Commission tells us that:

"The extended term would benefit performers who could continue earning money over an additional period. A 95-year term would bridge the income gap that performers face when they turn 70, just as their early performances recorded in their 20s would lose protection. They will continue to be eligible for broadcast remuneration, remuneration for performances in public places, such as bars and discotheques, and compensation payments for private copying of their performances."

The problem with this argument is that the facts do not back up the assumptions behind it. For example, the Gowers Review of Intellectual Property came strongly against term extension for sound recordings after commissioning a report dealing specifically with the economic evidence for and against extension. The report concluded that "the case for an extension of the copyright term in sound recordings to be weak." More importantly, the report found that increasing term extension would be detrimental for the UK's balance of trade, and it would increase costs to consumers between £240 and £480 million GBP.

Just in case the above report did not constitute enough evidence, the European Commission actually paid for another report from the influential IVIR in Amsterdam. The report answers the arguments put forward by content owners one by one: extending terms further than 50 years will not encourage more production; it will not make any difference to investments by the record industries; and it will erode the public domain. The report concludes then that "[t]he authors of this study are not convinced by the arguments made in favour of a term extension." Strong words indeed.

On top of these reports, a number of UK-based IP academics issued a considered look at the existing evidence (and then wrote an open letter in The Times), and made another strongly-worded statement against enhancement. Particularly, it was felt that the issue of fees is not one of copyright, but one of contract. Most artists get their remuneration from initial contracts with record industries, and as such, the amount that these artists would gain from extension would be minimal or negligible. This report states that:

"We have seen no evidence that living artists as a whole would benefit decisively from an extension of exclusive rights held by record companies. The benefits will fall to those who need it least: already wealthy performers, and their estates and record companies. In fact, in as much as innovative musicians are users of existing recordings, their artistry will be hindered, not enabled, by extension."

This seems like quite a considerable amount of evidence against extending terms for sound recordings. Yet, the Commission ignored all of it, and went for the extension. Bernt Hugenholtz, the academic behind the EU report, has been generating buzz in the blogosphere by pointing out that this is an unacceptable state of affairs. In an open letter to the Commission, he states that:

"As you are certainly aware, one of the aims of the ‘Better Regulation’ policy that is part of the Lisbon agenda is to increase the transparency of the EU legislative process. By wilfully ignoring scientific analysis and evidence that was made available to the Commission upon its own initiative, the Commission’s recent Intellectual Property package does not live up to this ambition. [...] In doing so the Commission reinforces the suspicion, already widely held by the public at large, that its policies are less the product of a rational decision-making process than of lobbying by stakeholders. This is troublesome not only in the light of the current crisis of faith as regards the European lawmaking institutions, but also - and particularly so - in view of European citizens’ increasingly critical attitudes towards intellectual property."

This is indeed a sad resolution to the consultation process. In the past, copyright policy has been drafted only with content owners in mind. We have become accustomed to undemocratic policymaking that pays no heed whatsoever to evidence, and simply responds to the skewed opinions of a few artists protesting about the loss of revenue and spouting whatever emotional argument will boost their current lobbying effort. I seriously thought that with the Gowers Review ad the Lisbon agenda the status quo would change, and we may start getting at least some more rationality and consideration in new directives. I guess that my optimism was misplaced, and we are back to the same old one-sided debate.

If the Commission intends to continue drafting policy to please content owners, at least they should abandon their facade of balance and save themselves the bother and cost of commissioning research which they will later ignore. It will also save me the bother of writing a long rant.

Gratz to the catz

I would like to congratulate the IPKat for winning Computer Weekly's Blog Awards for the IT Law and Governance category. I had already predicted that they were going to win it, so I am in no way concerned by this demonstration of cat power. Yes, there is the fact that IPKat is not technically an IT Law blog, but pointing that out would be petty and display a bitterness that I do not possess. No, I'm not bitter at all, not one bit. Bitter, moi? Nonsense! (grumble, grumble, wewasrobbed, grumble, grumble).

Class action suit against Dell

Some time ago we reported on the interesting case of pricing errors involving Dell Chile. The case has continued to develop, and now 40 consumers "affected" by the error have sued Dell for infringing Chile's Consumer Protection Law by "deceitful error inducing mistake in the price". The class action suit has been initiated by lawyer Gustavo Varas of the group problemas.cl. I don't want to be too dismissive, but looking at their website, I am reminded of the phrase "ambulance chasers".

I have already expressed my opinion of the case. To me this is a straightforward issue of contract formation and error, which in my mind invalidates the agreement. Moreover, it seems rich for the consumers to allege that some of their rights have been infringed, when it is evident that most of them contracted in bad faith, knowing well that they were faced with a pricing error. Consumer Law should protect consumers from abuse, not protect abuses perpetrated by the consumer.

Farming gold for development

(via Wiebke Abel) The BBC has a fascinating story on the astounding growth of virtual economies. Richard Heeks of the University of Manchester's Institute for Development Policy and Management has produced a report entitled Current Analysis and Future Research Agenda on "Gold Farming". The report makes for a fascinating read, and should validate the importance that many researchers like yours truly give to the regulation of virtual economies. According to the report:

"In basic terms, gold-farming is a sizeable phenomenon. The rather wobbly-legged best guesses for 2008 are that 400,000 gold farmers earning an average US$145 per month produced a global market worth US$500m; but we could easily more than double the latter to over US$1bn. There are probably 5-10m consumers of gold farming services. The main uncertainty of estimation relates to the gold-farming market in East Asia, which appears much larger than that in the US/EU. That uncertainty in part arises because gold farming operates at four levels – local, national, regional and global. We should encompass all four but, to date, the focus has been almost entirely on the global trade."

Even with the conservative estimates presented by the report, these are astounding figures. The numbers involved seem to suggest that gold farming is a valid and profitable industry, and that "playbourers" earn a decent living from it. Moreover, gold farming validates the importance of in-game economic activity by giving it a tangible value in the outside world.

This economic impact should perhaps strengthen the calls for regulatory oversight and policy examination of the role of virtual worlds in modern society. While they are still considered a form of fringe interest by the geeky classes, it is undeniable that an activity that employs 400,000 people in developing countries is worthy of examination. Isn't this a valid trade law subject? Where are the papers examining the electronic commerce implications of this phenomenon?

Richard Heeks concludes his report with an interesting plea:

"One final point. Credible analysis of gold farming can only be undertaken by researchers who play the games, and have engaged in real-money trading. With that, back to Azeroth for some more "research time". "

I concur. Unfortunately I have uninstalled WoW from my Mac laptop. Perhaps this would be a good opportunity to migrate to an American server. Does anyone have a good guild I can join?

Update: Interesting blog post on this study here.

Technophobic memes in the press

One of the recurring themes in this blog has been the popular depiction of technology in the media, particularly in mainstream press. It seems to me that there is a pervasive view of information technology in some sectors of the press, where new technologies are to be met with fear and distrust, and all problems presented by technologies are exposed, inspected, analysed, preached about, and stridently condemned by what I call the shrill technophobic classes.

Examples of this phenomenon are too numerous to mention, but some of my pet peeves are the blame allocated to any web technology for teenage suicides; the belief that games turn kids into violent criminals; the idea that the web is brimming with predators waiting to snatch our children away; and the excessive fear towards the powers of hackers.

Do not get me wrong, some of these fear have some justification. There have been well-documented cases of cyber-predators and groomers operating online; there seems to be a minor correlation between some violent games and aggressiveness; hacker attacks are a worrying threat to e-commerce; and some teenagers use social networking sites. However, I get particularly angry at the exaggeration of these issues in order to push a technophobic agenda that seems to condemn information technologies by distorting the actual threat these issues pose to society. For example, children are more likely to be abused by people they know, so why not direct resources to tackle that? Similarly, if there is some correlation between violent games and aggressiveness, regulators should remember that correlation does not mean causation. It is possible that violent games (and movies, literature, and other forms of entertainment) attract agressive people to begin with.

I also contend that these technophobic tendencies in the media tend to be more present in early adoption stages. The Web went through this stage, until browsing has become a fact of life. New technologies and services are met with similar distrust, Web 2.0 social networks, P2P, and many other internet phenomena have been met in their time with Luddite cries of protest, ony to become mainstream and widely accepted eventually.

I am in Costa Rica and I have been struck by the number and tone of technophobic stories warning worried parents about violent video games and grooming. Some of the depictions of the problems range from the anecdotal to the farcical. Perhaps developing societies such as this are trying to come to grips with the new technologies. It will be interesting to see if these views survive further sophistication.

Licence breach equals copyright infringement in U.S.

Some time ago I had talked about the case of Jacobson v Katzer, a very interesting ruling from the United States that in my view had made the argument that open source licences are contracts, and therefore breach of licence should be pursued as breach of contract.

As I wrote before, the case involved Robert Jacobsen, an open source developer participating in an open source project called Java Model Railroad Interface (JMRI), which is a model train software released it under the Artistic License. Jacobsen received a letter demanding the licence fee payments from a company named Kamind Associates, owned by Matthew Katzer, which has obtained software patents over model rail road software (particularly U.S. patent 7,216,836). Jacobsen decided to pre-empt legal action and sued Katzer first, alleging that the patent is invalid on the grounds of obviousness and for failure to meet disclosure requirements. He later amended the complaint to include copyright infringement, as he claims that his software pre-dates Katzer's. In first instance, the District Court alleged that there should be no presumption of a copyright infringement claim, and that such claim should be proven before the plaintiff can make its case. If they cannot provide evidence that such a claim may be successful in court, then the Jacobson can only rely on the contractual elements of the licence in order to seek redress; namely, the failure to place attribution notices is not enough to make a copyright claim, but a contractual one.

I was probably the only pro Open Source person who thought this was a good decision, as everybody else hated it because it contravened one of the main mantras of Free Software proponents, that OSS licences are not contracts. Katzer, who lost the case, appealed the ruling, and it made its way to the Court of Appeals for the Federal Circuit (CAFC), who have produced a decision that seems to please most people, except me of course. Lessig explains the ruling in very clear terms:

"In non-technical terms, the Court has held that free licenses such as the CC licenses set conditions (rather than covenants) on the use of copyrighted work. When you violate the condition, the license disappears, meaning you're simply a copyright infringer. This is the theory of the GPL and all CC licenses. Put precisely, whether or not they are also contracts, they are copyright licenses which expire if you fail to abide by the terms of the license."

Interestingly, Creative Commons, the Open Source Initiative, the Linux Foundation, Wikipedia Foundation, and others, presented an amicus curiae against the District Court reasoning. In this document the amici claim that "it would be enormously beneficial to public licensing for this Court to state clearly a rule regarding the importance of interpreting public licenses in a manner consistent with their unique nature and federal copyright policy."

The ruling makes for some interesting reading, and the CAFC has accepted the reasoning presented in the amicus curiae highlighted above. The CAFC says that:

"In this case, a user who downloads the JMRI copyrighted materials is authorized to make modifications and to distribute the materials Aprovided that the user follows the restrictive terms of the Artistic License. A copyright holder can grant the right to make certain modifications, yet retain his right to prevent other modifications. Indeed, such a goal is exactly the purpose of adding conditions to a license grant. The Artistic License, like many other common copyright licenses, requires that any copies that are distributed contain the copyright notices and the COPYING file."

The CAFC has to be congratulated for understanding the basic concepts behind open source licensing. In various passages, they clearly "get" the basis of the movement and the underlying rights. The CAFC has delivered the highest instance recognition to open licences, which is another encouraging sign. However, I am still somehow unconvinced by divorcing licences from the issue of contracts (at least in the United States). The main problem that I've always had with looking at licences as something separate from contracts is that they may have some unwanted results. For example, if all breach of licences are to be treated as copyright infringement, we may end up with decisions that retroactively apply such infringement, such as the recent Blizzard v MDY.

Nevertheless, this is a ruling that will boost the enforceability of all types of licences, not only open ones. I am attending a software conference in Costa Rica, and I heard from a Microsoft lawyer that they were very pleased with the ruling as it turns EULA licence breaches into copyright infringements. However, the ruling has no relevance in Civil Jurisdictions.

As a shallow aside, it seems like the new term to refer to open licences is "public licences". I shall now have to tinker with my blog tags.

SCRIPT-ed August 2008

The Editorial Board of SCRIPTed - A Journal of Law, Technology & Society is pleased to present its 18th issue, which addresses issues ranging from challenges in medical research governance in Korea, to pharmaceutical litigation (an assessment of the Novartis case in India), to data-protection of administrative records, to privacy in the age of sophisticated location-based technologies, to governance of the mobile communication sector in Korea and US, to a follow-up on our very popular Pistorius and the Olympics article, and more. To see the August 2008 issue, click here or on the cover. To see previous issues, go to Archived Issues.

In this issue:

Editorial

• The Xenotext Experiment
  Christian Bök, pp.227-231

Reviewed Articles

• The “Efficacy” of Indian Patent Law: Ironing out the Creases in Section 3(d)
  Shamnad Basheer & T. Prashant Reddy, pp.232-266
  
• A Tale of Two Standards: Drift and Inertia in Modern Korean Medical Law
  Shawn H.E. Harmon and Na-Kyoung Kim, pp.267-293
  
• How to Get There From Here: Re-use Of Administrative Records In The Netherlands And The UK
  Catherine Heeney, pp.294-308
• Deep Impact On The Mobile Communications Market: A Case Study In Applying The Regulatory Rules To Assess A Proposed Enterprise Combination
  Jongho Kim, pp.309-374
  
• Reasonable Expectations of Geo-Privacy?
  Sjaak Nouwt , pp.375-403

Analysis

• “Just One of the Challenges of 21st-Century Life”: Oscar Pistorius in the Court of Arbitration for Sport
  David McArdle, pp.404-413
• A Closer Look at the Canadian Copyright Act: Can Corporations Hold Moral Rights?
  Emir A C Mohammed, pp.414-418
  
• The Internet: Where Did IT All Go Wrong?
  Robert Schifreen, pp.419-427

Reports

• Institute for Science, Ethics and Innovation (iSEI)
  Muireann Quigley and Sarah Chan, pp.428-431

Book Reviews

• Biotechnologies And International Human Rights
  By Francesco Francioni (ed.)
  Reviewed by Amina Agovic, pp.432-433
  
• Defending The Genetic Supermarket: The Law And Ethics Of Selecting The Next Generation
  By Colin Gavaghan
  Reviewed by Eva Asscher, pp.434-437
  
• Patents, Inventions And The Dynamics Of Innovation: A Multidisciplinary Study
  By Roger Cullis
  Reviewed by Rosa Maria Ballardini, pp.438-439
  
• Law And Internet Cultures
  By Kathy Bowrey
  Reviewed by Amanda Harmon Cooley, pp.440-443
  
• Wired Shut: Copyright And The Shape Of Digital Culture
  By Tarleton Gillespie
  Reviewed by Michael Holloway, pp.444-446
  
• Property In The Body: Feminist Perspectives
  By Donna Dickenson
  Reviewed by Remigius N. Nwabueze, pp.447-448

The hackers strike back

Hacking is back in the news. The BBC reports that hackers in the U.S. infiltrated the computer networks of several companies and stole over forty million credit and debit card numbers. What is unusual about the case is that the hackers targeted their victim's secure wireless access points, and therefore gained access to the internal network.

This case highlights the problems posed by wireless networks. We have know for a while that wi-fi is a convenient yet insecure technology, as it opens systems to any passer-by with the know-how. There is not only the problem of piggybacking, but leaving computer systems and transactions open to interception.

The law already protects such type of hacking adequately, be it through "traditional" anti-hacking legislation, or normal fraud law. The issue then becomes one of law enforcement, evidence and cyber-security. Firms with large wireless networks should be aware that it opens their systems, and therefore the security should take into account that a hacker in the parking lot may have access to sensitive files.

And to top up hacking news, the Beeb also reports also that hackers are targetting Twitter by including trojans in viral video links. As a smug Mac user, I have to point out that this vulnerability only affects Microsoft machines.

Of trolls, anonymity and online norms

The nature of good and evil is not the usual TechnoLlama topic, but I have been thinking a lot about what makes people evil after reading the article in the New York Times entitled "The Trolls Among Us". This is a disturbing and compelling look at certain online communities that proudly dedicate themselves to trolling. In common internet lingo, a troll is a person who makes a deliberately incendiary comment in order to elicit an emotional response. As an old hand at internet forum moderation, trolling is a given, a fact of life as immutable as qwerty keyboards and Estonian hackers.

Many people buy the idea that the internet gives users seemingly tight anonymity. This belief, unjustified as it is, tends to create a particularly obnoxious class of netizen which revels in other people's suffering. I have often believed that the internet allows people to show who they really are, and often the picture is not pretty. As the much cited Greater Internet Fcukwad Theory predicts, a anormal person can become a troll when presented with the prospects of anonymity and an audience.

What does this have to do with evil? I believe that there is something happening in those online comunities that can tell us a lot about human nature. True, some of the actions of internet trolls are annoying, puerile, infantile, and often harmless, so why tar them with the big E word? Some of these people do whatever they do for "lulz", for fun, so where is the damage? There are several examples of nasty behaviour online, ranging from the disgusting case of some trolls emailing and phoning the parents of a teenager that committed suicide, to the outright strange case of Lori Drew. There is something clearly wrong with people who perpetrate such actions, but what I find most interesting is that there seems to be a large element of peer-pressure, community reinforcement, and ad hoc reasoning for the action undertaken by trolls. Most of these actions seems prompted by earning some form of community recognition in the troll underground sites, currency in the shape of "lulz". Trolls seem to get enjoyment from the juvenile act of telling other trolls of their exploits, thus reinforcing each others actions as normal. It is a well-documented phenomenon that peer approval is a very important factor in determining behaviour, and that criminal and "evil" behaviour is usually the result of community feedback. "Everyone else is doing it" quickly turns into "I was just following orders".

Some of the actions described in the NYT article may seem inoffensive social experiments, such as a blog saying that suicide victim "had it coming". Others range on the downright criminal, such as hacking email services, bank accounts an flooding phone numbers. One of them seems to defend his actions as a way of social service. He does hurtful things, but if people get offended it is not his fault, it is the victim's fault for taking offence in the first place.

Should the law enforce trolling? I am quite shocked that some of these people wilfully describe their actions to the press, when in many instances they could constitute criminal offences. Certainly, some type of trolling seems indistinguishable from hacking. Nevertheless, as long as the internet remains largely anonymous, the homo orcus will continue to inhabit the dark spaces under the information superhighway.