Thursday, June 30, 2005

The Ebb and Flow of "Legality" within Digital Content - MGM Vs. Grokster

I think we, as consumers, have general disdain for big business buying legal precedent that protect their archaic business models. Unfortunately, there is not much a general consumer can do to voice an opinion in the courts of law where big money is often the victor. Likewise, start-up companies, with funds nary enough to run their day to day business, cannot afford the luxury of big legal departments and slush funds with which to fend off the elderly velvet lined pockets of major industry players. The MGM Vs. Grokster ruling of recent provides these major players with the precedent they need to ward off technologies and initiatives that may challenge their deep rooted and stubborn version of distributing content. This decision has been oft-lamented by most every major technology commentary of late, and I recently ran across a little Q&A with Larry Lessig of Creative Commons, a non-prof who seeks to develop flexible copyright rules for creative content:

"Ten Years of Chilled Innovation"

I must admit, the advent of technology, and the pathways with which we are provided to distribute and share popular media content (art, music, movies, TV, etc) certainly do bring in to question the legality of certain aspects of transferring digital data, as there is little precedent by which to measure what may be considered "stealing", "sharing", "legal distribution", or whatever buzzword sought for perpetuation amongst consumers may be used. In light of the recent ruling, I must admit its hard not to become a modern day Robin Hood of digital media whereas one steals from the rich (big labels) and gives to the poor (consumers). Outside of a few initiatives supported by the big publishers, where-as media content gets parsed into small pieces and sold a-la-carte to consumers (iTunes, et al, and a few Movie distribution sites), there is still a dearth of understanding as to how copyrights should work in our digital world. Especially in an increasingly global economy; different countries are creating different rulings, and confusing the system even more so than ever before.

The current state of things is pretty sad, as it's becoming a one-sided battle where the few weapons consumers and start-ups may have are being stripped by legal decisions bought by big money and endless court cases. I'm not getting on an anti-corporate soap box here, but rather, I wish many of the big media publishers would realize that technology should be their friend, and find ways to embrace and create new business models by which everyone profits. Our digital world should enable cheaper yet much wider distribution of content, and these publishers should seek amazing ways to free their content and get it in to the hands of more people. Unfortunately, these old croons are set in their old ways of set prices for physical products, and they want the same type of physical control to extend in to a non-physical universe (digital baby!).

It's even more unfortunate that our court system in the States is bending over backwards to oblige the money being shoved in their faces (not to say they are accepting bribes). There is the blatant skewing of stats and figures by big industry lawyers and statisticians that show how much digital "piracy" is ruining their financial futures (it's even funnier that pirates are being romanticized by the same industry through several recent movie endeavors). I would equate this to a manufacturer of horse drawn carriages complaining that automobiles are illegal because they hurt their financial future stole the wheel as a transportation device (it's not perfect, but you get the ridiculousness of the concept here). I'll save my commentary on RIAA and MPAA suing actual consumers for another day (see: RIAA Sues 784 More!), but I simply wonder how long these players can go on treating consumers as criminals before it snaps back in their faces.

"Increasingly, this court is oblivious to the costs of its own decisions. The Reagan Administration pushed the regulatory-impact statements. I think we need an equivalent Ronald Reagan to push the judicial-opinion-impact statement that tries to calculate the efficiency costs of certain legal rules. I continue to be disappointed in Justice Souter's obtuseness to the costs of the complexity that he adds to the copyright system."

For certain, if every innovative idea will have to be stacked up against a legality ruler and have measures in place to prevent copyright infringement, it will no doubt deter most from actually pursuing applications of content distribution and sharing. Considering the cloud that hangs over the copyright system will only grow denser the more court cases pile on top of it, assures that less people will attempt to tackle the enforcement of increasingly nebulous and complicated rules.

"Take the number of [Apple (AAPL )] iPods sold and take the number of iTunes songs sold, and divide it, and it's something like 25 songs per iPod. You know there's more than 25 songs on every iPod. Where did people get their music? Well, they rip it from their CDs. Is that legal? Good question. It's not protected by the audio home recording act, which explicitly said you're allowed to make an analog copy of your CD. But [on the iPod], it's a digital copy.

Ask [former Motion Picture Association of America CEO] Jack Valenti or ask the recording industry whether it's fair use to be copying CDs. Well, they don't think it's fair use. So in selling iPods...[Apple is] encouraging CDs to be ripped. If it weren't Apple, which is a relatively strong company, but another company that's starting with this new technology, what would happen if you filed a lawsuit against them? Your lawyer would tell you, you can't afford to fight this."

Organizations like RIAA and the MPAA would love to create an evolving copyright system that they can control, shifting and changing the wording and application of it to meet their ever tightening fist of control on the marketplace. I am really disturbed at their ability to create an aura of right and wrong with regards to creative content, something that they define in an ever mercurial way. I believe that even when you purchase a song from the Itunes Music Store, the copyright agreement states that it can be changed at any time. The music you buy today, may not work for you in the future, because let's say they start charging a price per time the music is listened to, and you've gone over the limit! It may sound silly, but this evolving concept of content control is not really that far-fetched. If this happened, finding a way to circumvent the play limit on the song you "purchased" would be considered "criminal" activity, and thus, in a moral culture, you would be considered wrong, perhaps even sinful(?)! Ridiculous, scary, and possible at the same time. "Stealing" songs could keep you out of eternal joy in heaven people!

I have no idea where the proper balance is with this. The fair and profitable application of copyrights to digital content is a difficult thing to define and enforce. What I do know is that the industry who produce and publish the content should be at the forefront of this creative thinking. Instead, the distribution and sharing models have been relegated to pioneers who are being pushed to the "underworld" of computing. Decisions like this continue to alienate customers, stifle innovative ideas, and increase a media conglomerates' cold grip on a marketplace where consumers are supposed to hold the reigns of control in a competitive economy.


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