News from Europe this morning that the EU is planning a full review of its copyright directive. The review was to have focused on implementation in member states but now will be a broader evaluation of the directive itself. In further good news, Professor Bernt Hugenholtz will lead the review. The doubts associated with the WIPO Internet Treaties continues.TagsShareTuesday March 21, 2006
My weekly Law Bytes column (homepage version, Toronto Star version, international BBC version) examines the rise of the "clip culture" which has driven the remarkable growth of video sharing sites such as Youtube.com. The column highlights the different types of clips and discusses the legal and business implications that video sharing is beginning to generate. Read More ...
TagsShareMonday March 20, 2006
For policy makers, this form of user generated content raises questions about how best to support an important outlet for cultural and political expression. Moreover, it raises the prospect of possible legal reforms, including the introduction of a robust fair use provision, explicit protection for parody, and a re-examination of the law surrounding derivative works. These provisions play a key role in establishing the conditions upon which individuals can create new works that build upon the content of others.
From a business perspective, media companies are being forced to grapple with the competitive threat of user-generated content and to determine how to address unauthorized sharing of their clips. Many now actively seek innovative new user-generated content and leverage video sharing sites to create greater interest in their programming. For example, MTV2, part of the MTV music station family, and Deep Focus, the agency used by film studios to promote their movies, are working with Youtube to distribute content. Telecommunications companies and intransigent broadcasters face an even tougher choice, as their vision of an on-demand converged Internet, must now compete with the clip culture. That presents new challenges, since users are increasingly not satisfied with merely consuming content, but rather demand the ability to share and re-create it.
Update: Reuters has a lengthy article
on Youtube and the dilemma faced by the television industry. The article reports that Youtube is now streaming 30 million videos per day.
While CRIA regularly trumpets commissioned studies as evidence for the problems posed by P2P, this week it released a major study without any fanfare whatsoever. Conducted by Pollara last month, the study serves as part of CRIA's submission to the CRTC's Commercial Radio Review. What makes this particular study interesting (aside from the fact that it finally includes full details on responses and the actual questions posed), is that much of the data challenges many familiar CRIA claims.
Particularly noteworthy findings in the 144 page study report (appendix one) include:
In summary, CRIA's own research now concludes that P2P downloading constitutes less than one-third of the music on downloaders' computers, that P2P users frequently try music on P2P services before they buy, that the largest P2P downloader demographic is also the largest music buying demographic, and that reduced purchasing has little to do with the availability of music on P2P services. I've argued many of these same things, but now you don't have to take my word for it; you can take it from the record labels themselves.
- The survey asked for the sources of music on people's computers. Among those who download music from P2P services, the top source of music was ripping copies of their own CDs (36.4%), followed by P2P downloads (32.6%), paid downloads (20.1%), shared music from friends (8.8%), downloads from artist sites (5.6%), and other sources (2.9%). In other words, even among those who download music from P2P services, the music acquired on those services account for only one-third of the music on their computers as store-bought CDs remain the single largest source of music for downloaders (page 53).
- For all the emphasis on the teenage downloaders, it is interesting that the 35 to 44 age group had the largest spread between CDs and P2P as the source of music. Among that demographic, 31 percent of their music comes from P2P services and 27 percent from ripping their own CDs (page 69).
- Consistent with many other studies, people who download music from P2P services frequently buy that same music. The study found that only 25% of respondents said they never bought music after listening to it as a P2P downloaded track. That obviously leaves nearly 75% as future purchasers, including 21% who have bought music ten times or more. Note that demographically, the lowest percentage of non-buyers actually belonged to the 13 to 17 year old demographic (page 70).
- The 13 to 17 year old demographic also happens to be the largest purchasing group of music, buying an average of 11.6 music CDs or DVDs in the past six months. Close behind are the 18 to 24 age group at 10.9 music CDs or DVDs. By comparison, the older demographics may not download much music but they don't buy much either. The 55 - 64 age group bought 4.2 music CDs or DVDs, while the 65 and up age group bought 2.8 music CDs or DVDs (page 92).
- As for music buying trends, the study also asked whether purchasing patterns had increased or decreased over the previous year. The data was inconclusive with 28% buying more, 35% buying less, and 37% saying they didn't know (page 93).
- More interestingly, the survey also asked why people bought less. Only 10% of respondents cited the availability of music downloads. Instead, people cited a long list of alternatives that have nothing to do with downloading including price (16%), nothing of interest (14%), lack of time (13%), collection is big enough (9%), don't buy (7%), listen to radio (7%), change in tastes (6%), no CD player (3%), have an MP3 player (2%), lack of opportunity to buy (2%), watch more tv (2%), age (1%), only buy what I like (1%). Simply put, P2P simply is not a major factor behind decisions to buy less music (page 95).
Update: Howard adds to the coverage of the Pollara report by noting the enormous difference in the response to the question about Canadian copyright law and international standards. CRIA reported that 72 percent of Canadians favoured meeting international standards in December, while two months later that number declined to 46 percent. As Howard notes, the difference highlights the lack of reliability of public surveys about complex legal treaties since most people have not taken the time to become fully informed about the issue. Of course, asking about copyright law and international standards increasingly means more than just WIPO as it may also include the dozens of exceptions contemplated by the Australian parliamentary committee, the mandatory DRM compatibility being considered in France, fair use provisions in the U.S., and the provisions being floated as part of an Access to Knowledge Treaty.
Update II: Pollara has responded to this posting and I've replied with a few comments.
TagsShareFriday March 17, 2006
Late this afternoon, the Canadian Internet Registration Authority, which manages the dot-ca domain, issued an important public letter to ICANN. As a CIRA board member for the past five years, I'm particularly proud of this letter as the organization has publicly called on ICANN to follow accountable, transparent, and fair processes. The public call comes after a number of incidents, the most prominent of which is the ICANN - Verisign agreement, which the ICANN board approved in late February. The letter sets out the changes that CIRA thinks are needed for ICANN to succeed. Until ICANN remedies the accountability concerns, CIRA's board has decided to suspend voluntary payments to ICANN as well as any consideration of the Accountability Framework that ICANN has promoted to country-code TLDs. Moreover, CIRA will not host or be a major sponsor of any ICANN events.
It is an open secret that many in the Internet community are frustrated by the ICANN board's recent actions. CIRA may be the first ccTLD to take this public action, but I'd be willing to wager that it won't be the last.TagsShareFriday March 17, 2006
A federal court judge has fined Vortek Systems, a Montreal-based electronics retailer, nearly one million dollars for failing to pay the private copying levy. The company was ordered to turn over the unpaid levy amounts ($1.65 million plus interest) along with a penalty of just over $900,000. Vortek denied that it was selling blank CDs.
Make no mistake - along with its distortion on the market, the levy's "pennies" (as derided by CRIA) has become big money for the industry which it will fight hard to preserve.TagsShareFriday March 17, 2006
Rob Hyndman has a great posting on the CRTC's Commercial Radio Review. With more than a hundred groups and individuals commenting so far (the overwhelming majority
of which are not posted online, at least for now), I get the sense that
the May hearings will be pure theatre with each group tripping over the
other to claim how they are genuinely threatened by the Internet and
Update: I spoke too soon as the CRTC has been busy posting the contributions online.
TagsShareThursday March 16, 2006
Earlier this week, I wrote an article
on the role of government and Internet connectivity. The NY Times runs
a pair of stories today on the South Korean experience with active
government involvement in technology. With the country a world leader in cellphone technology and people able to watch reasonable quality television on their cellphones, they're doing some things right.TagsShareThursday March 16, 2006
The UK Court, Queen's Bench division issued an important decision on
the liability of Internet service providers late last week. Unlike the
U.S., which established statutory immunity for intermediaries where
they simply provide the forum for publication, Commonwealth countries
such as the UK, Canada, and Australia still rely on common law
principles leaving some question about the standard of liability for
intermediaries for allegedly defamatory content posted on their sites.
Bunt v. Tilley involved
an attempt to hold AOL, Tiscali, and British Telecom liable for
allegedly defamatory postings. The claimant relied on the Godfrey v.
Demon Internet case to argue that the court could hold the ISPs
liable. That case has generated concern among ISPs in Canada as it
does hold out the prospect for liability. The court was clearly
uncomfortable with that decision, however, issuing a decision that was
generally sympathetic to the ISPs.
In particular, the court concluded that "an ISP which performs no more
than a passive role in facilitating postings on the internet cannot be
deemed to be a publisher at common law." That is the good news as it
provides some comfort to ISPs who can rely on this case to argue that
they are not liable for doing nothing more than hosting content.Read More ...
TagsShareTuesday March 14, 2006
The bad news for ISPs is that they still face liability where they are
put on notice about allegedly defamatory content. The court did
acknowledge that "if a person knowingly permits another to communicate
information which is defamatory, when there would be an opportunity to
prevent the publication, there would seem to be no reason in principle
why liability should not accrue."
While the decision is helpful, Canada and other Commonwealth countries
should still consider establishing statutory protections for ISPs since
those intermediaries continue to have incentives to remove what may be
legitimate content based solely on being placed on "notice" that they
are hosting allegedly defamatory content. When presented with a
notice, most ISPs will remove the content without consideration for
whether it is a legit claim because they run the risk of liability for
failing to do so. It should take more than just a notice to remove
this content. Much like child pornography and copyright, it should
take a court order.
My weekly Law Bytes column (Toronto Star version, homepage version)
picks up on Toronto Hydro's announcement last week of its plans to
blanket the City of Toronto with wireless Internet access. I note that
the announcement has sparked an important debate about the appropriate
role for governments and public institutions in providing Internet
connectivity, which comes on the heels of the CRTC's recent decision to
distribute $652 million to major telecommunications providers such as
Bell and Telus to help defray the costs of implementing high-speed
connectivity in rural Canadian communities.
These developments place the spotlight squarely on a critical question
for new Conservative Industry Minister Maxime Bernier - what, if
anything, should government do about Internet connectivity?
The starting position for a Conservative government might well be to
argue that government has a very limited role to play here, concluding
that this is strictly a marketplace issue and that the private sector
has plenty of incentives to develop networks for consumer use.
Given the Web's importance, I argue that government cannot adopt a
hands-off approach, though it must recognize that its role differs in
the urban and rural markets.Read More ...
TagsShareMonday March 13, 2006
In urban communities, most of which are
serviced by a choice of two broadband options (cable or DSL), the focus
ought to be on the competitive environment and the assurance that the
entire community can afford access.
The governmental role in rural Canada ought to be a different one. In
those communities, many of which lie on the outskirts of major cities
such as Toronto or Ottawa, the concern revolves around connectivity,
not competition, since there is often no broadband option available to
While its intent is laudable, the CRTC's approach is an inappropriate
way to solve the problem. Since the money comes directly from Canadian
consumers, consumer groups rightly argue that it should be returned to
those same consumers (each consumer would receive approximately $50).
The Commission's decision has highlighted the need for governmental
involvement, however, since the major Canadian ISPs informed the CRTC
that without external support, there is no economic case for building
high-speed networks in many rural Canadian communities.
The solution therefore lies not in simply handing over $652 million in
economic assistance to the telecommunications providers, but rather for
government to support local, community-owned networks that operate for
the public benefit. While the telecommunications providers might be
called upon to establish the services, publicly funded networks would
remain in public hands, with the communities retaining the flexibility
to offer reduced fees or alternate options.
The Alberta government last week introduced Bill 20,
which is designed to stop compelled disclosures of personal information
under the USA Patriot Act. The bill creates fines of up to $500,000
for violating provincial laws governing disclosure of records. The
fines arise for violation of the following provision:
"A person must not wilfully disclose personal information to which this
Act applies pursuant to a subpoena, warrant or order issued or made by
a court, person or body having no jurisdiction in Alberta to compel the
production of information or pursuant to a rule of court that is not
binding in Alberta."
With B.C. and Alberta leading the way on this issue, the pressure for action at the federal level should continue to grow.TagsShareSunday March 12, 2006