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The Legal Limits of Government Tinkering With Technology

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Tuesday April 18, 2006
My weekly Law Bytes column (Toronto Star version, homepage version) uses the recent French Parliament law involving interoperability and Apple's DRM as the basis for a discussion of governments that tinker with technology through regulation.  The law should be understood as a logical reaction to mounting consumer frustration with technological limitations on their purchases and a desire for balance in copyright. 

Although the French law may appear to be unique, many governments regularly tinker with technology through regulation.  For example, the Liberal government last year introduced "lawful access" legislation that would have required Internet service providers to dramatically overhaul their networks by inserting new surveillance technologies.  Similarly, the U.S. established "broadcast flag" requirements that would have mandated the inclusion of copy-controls within a wide range of electronic devices (a court struck the requirements down as unconstitutional).

Moreover, experience demonstrates that the private sector may not respond to consumer demands to offer compatible products.  The satellite radio market provides a recent example, with the two major providers - XM and Sirius - steadfastly refusing to offer a device that supports both services despite the fact that they have jointly developed just such a product.

With government intervention looming as a possibility and the private market unlikely to resolve compatibility concerns, what principles should regulators adopt to provide all stakeholders with greater certainty about the appropriate circumstances for lawmakers to tinker with technology? The obvious starting point is that intervention is possible - indeed desirable - where companies with dominant marketplace positions exploit the lack of compatibility for anti-competitive purposes (there have been no allegations that Apple has acted illegally with the iPod and iTunes, though the major music labels are the target of several anti-competitive investigations in the U.S. arising from the digital music market).  The legal actions against Microsoft in the U.S., Europe, and South Korea, most of which remain active, highlight this principle.  Authorities fear that the world's largest software maker could use its proprietary standards in the operating system market to exclude competitors in other software areas.

Regulators may also be inclined to act in order to protect the public in cases when technology poses a safety concern or is used to eliminate or hamper consumer rights.  Technological requirements to meet safety standards or enforce environmental protection are common today, with government setting requirements for many consumer products and mandating testing before certain technologies may be marketed to the public. 

Similar issues are entering the digital domain. For example, most DVDs include region codes that link the product to the region in which they were purchased.  DVDs purchased in Canada will play on Canadian DVD players, yet discs bought while on vacation in Europe will not function on those same DVD players.

In addressing the issue, Australia has proposed protecting the content on the DVD, but ensuing that the public is not precluded from trying to break the technological protection that surrounds it. The Australian response, which the French parliament would have been well advised to emulate in the iTunes case, highlights the need for government to avoid prohibitions that limit the ability of the public to tinker with technology.  Tinkering often encourages innovation through new discoveries, while a patchwork of patents, trademarks, trade secrets, and copyright protect the underlying content. 

Comments (3)add comment

Shane said:

Technology
The odd thing is, I'm not worried about lawmakers tinkering with technology. I'm more worried about 'providers' tinkering with 'content'. The sony rootkit provides a great example of 'providers' trying to control your computer, rather than leaving the consumer that freedom.

Allowing companies to police your possessions is more than a little alarming. In my opinion DRM should be illegal, not the tampering. People will just keep cracking the DRM, and the companies will just provide more convoluted DRM that will be cracked until 50% of your CD or DVD is dedicated to 'protecting content' rather than actually providing it. DRM is the ultimate waste of time.
April 18, 2006

Michael Admans said:

...
Michael,
It is good to see open discussion on these matters, thank you!
The position with DVD regional protection is very much against the interests of the consumer anywhere, not merely in Australia.
For example, if I buy a DVD here in Canada I could send it as a gift to a friend or relative in Europe or Australia and it would not play. Now imagine if I bought a book here in Canada and sent this gift to the friend overseas who, upon unwrapping the gift found that the covers had magically glued themselves together or the pages were blank. Does anyone believe this would be acceptable? The book publishing industry has much the same concerns as the film industry in guarding its publication rights in different countries yet has found it perfectly adequate merely to print on the book-cover "this book only to be sold in North America" or something similar. Why cannot film publishers follow suit?
April 18, 2006

Richard said:

DVD protection and GSM...
The DVD region coding is no longer a serious threat to people's use of their DVDs. Like all bad laws. bad ideas and also all bad systems, the market will eventually decide. In Germany for example, region-free coding (coding 0) players have been available for years. I believe China produces most of the region free players. A huge number of players can be made region free, simply by pressing a combination of buttons on the remote controls - if one is motivated to look. For PCs, there are also a number of really excellent free programs on the internet which allow you to remove the coding so easily, it hardly seems to be worth studios including any form of coding at all. DVD region coding is a dead duck that refuses to lie down. It was only ever a marketing ploy anyway intended to restrict releases of content according to the providers schedule.

On the subject of government tinkering, it might be worth considering the way the European Union mandated the use of GSM mobile phone technology. Not only has this increased the penetration of the technology throughout the EU ensuring interoperability, it has made it a world beating system used by nearly every country - including finally North America after a slow start. The slow take up of mobile phone technology in the USA was due to interoperability issues as much as anything else. Interestingly enough, Qualcomm's proprietary system was pushed as the mobile phone system for the new Iraq because GSM originally had a French acronym and France opposed the war there! Qualcomm's lobbying did not work and GSM was chosen because everywhere else uses it. All rather obvious - no-one in their right mind would want a system which does not work with anyone elses.
April 19, 2006

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