The following paper was distributed at WIPO last week at the close of the meeting of the Committee of Experts on the New Instrument. We would have delivered a similar oral intervention, but unfortunately the debate on moral rights and adaptation left no time to open new subjects.
Seth Greenstein
<sethg[_at_]access1.digex.net>
LEGISLATIVE IMPLICATIONS OF COPY MANAGEMENT
FOR THE CONSUMER ELECTRONICS INDUSTRY
The Electronic Industries Association (EIA) does not
necessarily oppose in concept the application of appropriate
technologies that regulate copying of works in digital formats.
EIA and its members created the Serial Copy Management System
("SCMS") for digital audio. In cooperation with the recording
and music industries, EIA urged the legislative adoption of SCMS
in the United States as part of the Audio Home Recording Act of
1992.
This cooperation was only natural. Technologically speaking, copy regulation is a partnership of hardware and copyright industries. All copy regulation systems operate by some interaction or interference with the recording functions of consumer electronics hardware.
But for manufacturers, technical copy management systems raise myriad commercial, legal and policy implications for use, liability, design and cost. Such systems must be implemented in a manner that adequately protects the interests of all parties concerned -- hardware manufacturers, copyright holders and consumers.
The WIPO drafts -- paragraph 98 in the Berne Protocol and paragraph 100 in the New Instrument -- however, respect only one party in this complex interdependent relationship. The proposal would require the implementation of copy management technology without the involvement of and without any concern for the hardware manufacturers or the interests of the consumer. Instead, the WIPO proposal would place sole rights and decisionmaking power concerning the operation of hardware products in the hands of the copyright holder. This, we submit, is illogical, unworkable, unrealistic, fundamentally unacceptable to the consumer electronics industries and, in the final analysis, detrimental to consumers and the world economy.
THE NEED FOR LEGAL AND TECHNICAL STANDARDS A key flaw in the WIPO proposal is that it vaguely outlaws circumvention of technology without any definition of, or reference to, a positive technical standard. Without governmental standards and guidelines as to what constitutes an acceptable copy management system, manufacturers are left vulnerable to draconian civil and criminal liability, and may lack the legal, economic and technical certainty required for prudent investment in new technologies.
Without standards or guidelines, copyright holders could be free to impose upon manufacturers systems that are costly to manufacture, expensive to license, inefficient, or detrimental to the quality of the reproduction of the works. Past systems proposed by copyright holders, and opposed by consumer electronics manufacturers, in fact have had such negative attributes. Governmental action, such as the standards approved by the United States and Japan with respect to the Serial Copy Management System, is necessary to assure that copy management technologies are economical, efficient in operation, and fair.
Standards are necessary to assure adoption of common and compatible systems. Without standards, copyright holders could adopt multiple copy management systems at a potentially prohibitive cost. Not all copy management schemes can be implemented easily and inexpensively; and circuits designed to implement one copy regulation system could defeat another. Without definite standards, manufacturers could be subject to liability for infringement solely by consciously choosing between inconsistent technical systems.
Without standards, the proposal could stifle technological development and innovation or, conversely, could outlaw existing equipment designs.
The anticircumvention proposal could mandate licensure of proprietary systems and sanction monopolistic practices. As drafted, the measure could require use of proprietary technology without either leaving licensing to the marketplace or assuring the availability of licenses on reasonable, nondiscriminatory terms. Making the right to impose a mandatory technical scheme into a copyright is a fundamental flaw. In essence, it conveys a government monopoly over a circuit to which there is no alternative allowed in the marketplace.
Standards also are necessary to secure consumer rights to record. Consumers commonly use recording devices to preserve family memories or to create personal audio or video productions. In countries that have enacted levy systems, and in those that permit certain types of copying as fair use or fair dealing, consumers have the ability to make copies for private, noncommercial use. Any system that unfairly restricts such copying, particularly from analog to digital, or digital to digital, is unacceptable from either a legal or marketing standpoint. Yet the draft measure would require adherence even to systems that had such "side effects." In this regard, the greatest deterrent to circumvention of copy management systems is to eliminate the incentive to circumvent. The consumer will have no such incentive when a fair range of copying is permitted.
TECHNICAL SYSTEMS REQUIRE CIVIL, NON-COPYRIGHT LEGISLATION Fundamentally, EIA opposes the treatment of technical copy regulation as a right inherent in a copyright grant. Lawsuits based on contributory or vicarious copyright infringement are uncertain in scope, unpredictable in result, excessively expensive to litigate and, if statutory damages are assessed, potentially devastating. Inevitably there must be good faith disagreements about whether a device is designed or adapted to be a "circumvention" device. Manufacturers will be deterred from investing in legitimate recording technologies if they risk incurring crippling financial or criminal penalties.
EIA could only consider supporting legislation addressed to anticircumvention of copy management systems as civil, noncopyright legislation with defined civil, non-copyright remedies. Indeed, we question whether this issue, at least as to sound recordings and video, belongs at all in the Berne Protocol, and whether it perhaps should not be addressed instead as a provision of the New Instrument. The marketplace and all participants are best served by remedies designed specifically to achieve a determination in this respect, without invoking the dangers and uncertainties of general civil and criminal copyright remedies.
THE AUDIO HOME RECORDING ACT -- A POSITIVE EXAMPLE The Audio Home Recording Act ("AHRA"), enacted in the United States in 1992, exemplifies this technically-based legislative approach. EIA was able to support the AHRA because it contains an express exemption from copyright-based suit. Moreover, the AHRA relies on a technical regime with these characteristics:
(1) AHRA contains explicit and publicly available positive
technical standards, (a) against which compliance can be
measured, and (b) lending definition and scope to its anti-
circumvention provision;
(2) AHRA facilitates compatibility with pre-existing and
future technologies;
(3) AHRA's mandated system operates without degrading
quality of either the original or the copy;
(4) AHRA protects consumers' ability to make unlimited
copies of uncopyrighted or original digital recordings;
(5) AHRA respects consumers' historical practice with
respect to first generation copies for personal uses, thus
minimizing any incentive to circumvent copy limitations;
(6) AHRA does not impose excessive design demands or
manufacturing expense upon manufacturers, so adds little
cost; and
(7) AHRA is enforced by unique remedies crafted for and
appropriate to the purpose, rather than by copyright
infringement remedies.
These attributes, and particularly the explicit standards
and criteria for implementing both a public domain version of its
technical system (SCMS) and future iterations for newer
technologies, sufficiently reduce the potential risk that the
AHRA's anticircumvention provision (17 U.S.C. Section 1002(c)) would
ensnare legitimate devices or consumer conduct. Moreover,
violation of this provision could invoke specific civil liability
under the AHRA, and would not result either in liability for
copyright infringement or criminal penalties. See 17 U.S.C.
Section 1009.
EIA respectfully suggests that these aspects of the AHRA provide the appropriate paradigm for implementation of any legislation addressing copy management.
CONCLUSION The consumer electronics industry can only support the adoption of technical copy management systems if it is treated fairly and has its rights respected as a full partner in this process. The WIPO memorandum, and every national legislative proposal, should give full and fair consideration to the rights of the creators of the hardware that would implement any such system. Received on Mon Dec 19 1994 - 00:47:11 GMT
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