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Ensuring Content Protection in the Digital Age
Subcommittee on Telecommunications and the Internet
Mr. Joe Kraus
Introduction Mr. Chairman and members of this committee, good afternoon. My name is Joe Kraus and I am co-founder of
DigitalConsumer.org, a new consumer advocacy group dedicated to safeguarding
citizens' fair-use rights to digital media. To be more specific, we want to be
sure that any digital rights management solution or legislation protects the
digital rights of consumers in addition to protecting the digital rights of the
entertainment industry. I am here to represent the views of the 35,000 Americans who
have become members since our formation 6 weeks ago. We thank the Committee for
holding this hearing and for allowing us to testify. Our members are not teenagers swapping songs on the
Internet. They're ordinary, law abiding citizens who insist that Congress
protect their historical fair-use rights. They are people who respect
intellectual property but who also believe that their rights should not be
"collateral damage" in the "war against piracy". They're people like Gregory
Brewsaugh, a self-described Republican high school physics teacher in
Huntington Beach, California. Mr. Brewsaugh has purchased over 400 CDs. He has
copied his CDs onto his computer which he then uses as a 4,000 song personal
jukebox to deliver music throughout his home. Mr. Brewsaugh simply loves music,
loves electronics and enjoys the freedom he has to listen to the music he
lawfully acquired in a manner and form of his choosing. DigitalConsumer.org members are proponents of intellectual
property protection. We do not support or condone piracy. However, unlike what
media companies would like you believe, copyright does not confer on the holder
of a copyright the power to control every access, use, or copy of a work from
cradle to grave. Not all "unauthorized"
copying is piracy and not all consumers are potential criminals. We've all made mixed tapes of our favorite music. We've all
made copies of CDs to take to the gym or listen to in the car. We've all
recorded a sporting event to watch after our child's soccer practice. None of
these copies were "authorized" by the content companies. Yet, is there anyone
on this Committee who believes that these are acts of piracy? Of course
not. Although they are unauthorized,
they are all examples of legal, personal, fair-use. However, the entertainment industry has consistently denied
the existence of consumers' fair-use rights. In July of 2000, Hilary Rosen
represented the RIAA before the Senate Judiciary Committee. Senator Hatch asked
if it was fair-use for him to make a copy of a CD for him to listen to in his
car, or for him to make a copy of a CD to give to his wife. Ms. Rosen responded
that "none of those examples is fair-use." Instead, they are examples of what
she called "tolerance" on the part of the music industry. In other words, the recording industry takes
the view that these are examples of "unauthorized" uses that the entertainment
industry chooses not to take us to court for having committed. We disagree. Consumer's have fair-use rights and they expect
Congress to safeguard them. Congress and the courts have carefully crafted a
deliberate balance between the rights of copyright holders and the rights of
citizens. Generally speaking, rights holders have the exclusive right to
distribute and profit from artistic works. Consumers who legally acquire these
works are free to use them as they see fit, so long as that use is personal and
non-commercial. We respect the right of the content industry to pursue pirates. But, that pursuit must not sweep so broadly that it also punishes law-abiding citizens. Unfortunately, the media industry's technical and legislative agenda does precisely that - it goes far beyond preventing piracy to prohibiting legal personal use. Content companies have used anti-piracy laws to effectively criminalize what to date have been "unauthorized" but nevertheless legal uses of media. The result? Consumers will wind up paying for what they have had previously been allowed to do for free. Erosion of our
personal use rights Let me give you some examples of the methods the content
industry is using to erode fair-use
rights. Method #1. Technological Barriers to Fair-Use. Copy
protection technologies in the market today have impacts beyond their stated
goal of reducing piracy. These technologies give content companies an
unprecedented ability to reduce or even revoke fair-use rights. My mother
called me to insist that her MP3 player was broken because she couldn't copy a
recently purchased CD to her portable player. She was surprised to learn that
the CD was operating as intended - it was explicitly designed to prevent her
from making her legally allowed copies. Similarly, my dad called to tell me his DVD player was
broken because the 'menu' button wasn't working when the previews were playing
on his DVD (thereby preventing him from skipping the previews). He was
surprised to learn that existing law made it illegal to create a DVD player that
would skip through content that the media companies flagged as 'must watch'. The irony is that these technical barriers have been more
effective at preventing my mom from copying her legally bought music to her MP3
player than at diminishing major commercial piracy operations in China and
Taiwan. Copy protection isn't breakable by my mother, but it is very breakable
by computer hackers. Method #2. Legislative Barriers to Fair-Use. In 1998 the entertainment industry came to
Congress with a proposition: give them greater copyright protection and they
would unleash a tidal wave of legal, downloadable digital movies and music for
consumers to enjoy. As a result, Congress passed the Digital Millennium
Copyright Act (DMCA). Congress lived up to its end of the bargain but the
entertainment industry did not. Four years after the passage of the DMCA,
consumers are still waiting for the flood of legally available content;
meanwhile the law is being used to diminish or erase consumer's fair-use
rights. Now, the entertainment industry is back making claims similar to those made in 1998: "Give us more protection and great things will happen." We have no reason to believe the outcome for consumers will be any different this time around. Method #3. Commercial Barriers to Fair-Use. Many
decisions relevant to fair-use are increasingly made by entertainment and
consumer electronics industry consortia with little or no input from citizens.
Ordinary people have historically been excluded from many of the decisions that
affect how they enjoy the media they legally pay for. For example, consumers
had no voice in deciding that DVDs could disable the 'menu' button during
previews. Consumers had no voice when copy protection technologies for CDs were
developed that denied consumers their ability to copy CDs onto their portable
music players. Consumers were not represented when it was decided that DAT
tapes could only be copied once (even if the voice on the DAT tape was your
own). And no members of the press were permitted to observe and report on the
most recent standards setting consortium - the so-called BPDG. In general,
consumers have not been allowed to participate in decisions that affect their
daily lives nor has the press been permitted to observe how these decisions are
made and report their findings to the public. The terms of the
debate Most importantly, fair-use rights are being threatened by
the way that the entertainment industry is framing this debate. They would have
you believe that all copying that they have not authorized is piracy, even
though Congress and the courts have affirmed our rights to make personal copies
of movies and music. When my mom makes copies of a CD - one to take to the gym,
one to listen to on her computer, one to give to her husband - that is not
piracy. The content industries have gone so far as to make a frontal
assault on the industries that support consumers' legal rights. They have accused Apple, Intel and Gateway of
sponsoring piracy simply because they give citizens tools to exercise their
fair-use rights. The content industries complain that the rest of the country
has been slow to come to consensus on copy protection issues. But a compromise
will inevitably be difficult when the content industry refuses to concede a
fundamental fact - fair-use exists. I urge Congress to recognize that stopping piracy is just
one goal of copyright law. That goal needs to be balanced against the goal of
protecting the rights of citizens. Citizens have been left out of this debate
even though they stand to be the most affected by the outcome. Your
constituents expect Congress to safeguard and assert their fair-use rights. The Broadcast
Protection Discussion Group The erosion of fair-use rights is occurring in many
different places. The forum that concerns us today is the Broadcast Protection
Discussion Group - a group this committee is very familiar with. We see three
main problems with the process adopted by the BPDG. No consumer
participation. Most importantly, the process has excluded consumers. As in
previous cases, consumers are not participants in a process that will affect
the way that they watch, record and enjoy their television. No provisions for
fair-use. Second, fair-use is not protected by the specification - in fact,
it is not even mentioned. While the interim progress report to this committee
briefly discusses fair-use (section 2.7), the draft of the specification
ignores it completely. If we all agree that fair-use is going to be protected,
then why haven't the parties to the process put it in writing and included it
in the specification? When I attended the most recent BPDG meeting I asked for a
positive assurance that fair-use rights would not be abridged by any technology
placed on the contentious "table A". Unless the Congress acts to insure that
fair-use rights will not be abridged by any technology implemented pursuant to
the BPDG, then how can it be sure that devices which enable free time shifting,
space shifting, multiple copies, or even multimedia homework assignments, won't
be prohibited by this process? Too much control in
industry hands. Third, the BPDG members tell you their intent is to prevent
the unauthorized retransmission of content over the Internet. That may be the
charter, but the document produced thus far establishes a technical regime
which would give BPDG members far greater control - control over how consumers
watched, recorded and enjoyed their digital television. Nothing in the
specification prevents the deployment of technologies which would: allow media
companies to control when your VCR recordings expired (imagine going on a two
week vacation only to find out that your recordings of your favorite programs
expired after a week); stop you from taking your home recordings on your laptop
to watch on the train to work; or prevent you from watching recorded shows
during primetime. When I raised these issues at the latest BPDG meeting, I was
told that the technologies deployed would most certainly have "baggage" that
would affect fair-use. While fair-use rights may be "baggage" to the
entertainment industry, those rights are cherished by citizens. And citizens
expect Congress to act in their defense. It is one thing for the entertainment industry to grant
their blessing to one or more technologies that will erode the rights of
consumers. If consumers choose to adopt a technology that diminishes their
rights, that is their decision.
However, it is quite another for the Congress to give the entertainment
industry's preferred technologies the force of law. And that is precisely what
this entire debate is about. The members of the BPDG say that Congress should enforce the
consensus of the content and technology industries or give the FCC the power to
do so. We believe Congress also has an obligation to safeguard the rights of
citizens who have not had a voice in this debate. Congress should insist that
consumer's fair-use rights be explicitly asserted and defended in the BPDG
specification. Legislation to
give more rights to copyright holders is not needed. The entertainment industry is back in Washington asking for
more changes to the law. They claim that the marketplace has failed to help
them develop technologies to protect their intellectual property and that
therefore the government needs to step in legislate. We believe this is the
wrong path for Congress to take for several reasons. First, Congress should think of this problem in terms of
rights, not in terms of technological mandates. Define the rights of the
respective parties (copyright holders and citizens) and let the market develop
technologies which adjudicate between the two. Copyright holders have strong
rights while consumers' rights are weak and ill defined. Therefore, to help the
market to work effectively, the first step to solving the piracy problem is not
a government mandate, but a strong assertion of consumer rights. Second, many computer science experts believe that a secure
system is not possible. Princeton Computer Science Professor Ed Felten, a computer security expert, noted in his
testimony to the Senate Judiciary Committee on March 14, 2002 that "a standard
for copy protection is as premature as a standard for teleportation". Further quotation from his testimony illustrates this point.
"Every copy protection scheme for general purpose computers that has undergone
serious public scrutiny has been found to be ineffective. Consider what will
happen if a government mandated protection measure turns out not to work. Such
a measure would do many things: it would inconvenience honest consumers; it
would raise the price of media players; it would lengthen product development
cycles; it would impede the development of new and better standards. Everyone
would suffer, except the pirates. The industry that devised the measure would
look technically inept, and the government that mandated its use would look
worse." The solutions that the content industry has advanced to date
have been more effective at preventing consumers from copying their legally
bought music to their MP3 players than at diminishing major commercial piracy
operations. As we all know, copy protection isn't breakable by the average
citizen, but it is very breakable by software experts. A government mandated technology standard will not be any
more effective at preventing piracy. Instead, the consumer will lose as another
technology that deprives them of control and flexibility is forced upon them. Third, putting the government in charge moves the decision
from a market-based one to a political one. The development of technology
should be driven by the private sector, not by a government agency. Fourth, given the slow speed of a government-driven process,
the chosen standard will inevitably become outmoded and the process for
revising it and updating it will be slower than a market-based approach. Finally, while some in Hollywood claim that a government
standard is needed to ensure interoperability, legislation has not been needed
to guarantee other critical types of interoperability: CDs play in all CD
players, DVDs play in all DVD players, Internet Protocols allow all computers
to talk to one another. None of these examples required government
intervention. A dearth of
viable, legal alternatives. We believe that one of the causes of the illegal copying of
music and movies (although not the only one) is the dearth of commercially
viable legal alternatives. MusicNet and PressPlay (the music industry's legal
alternatives) have serious flaws: they lack deep catalogs and they don't
provide consumers with the flexibility they expect from their music. For
example, in many cases consumers cannot transfer music to portable players, or
in the case of PressPlay the music "expires" as soon as users stop paying the
subscription fee. Consumers are voting with their feet and avoiding these
services. I believe this is not primarily because the competition is free, but
because the competition delivers what consumers expect: they can find the music
they're looking for and once they find it, they can do with it what they expect
(i.e. take it to the gym, listen to it in their car, etc). As the Economist
magazine (March 21, 2002) accurately observed, "the meaner the industry is over
what people can do with the [content] they pay to download, the more the
studios' own services will be a second-rate alternative to piracy" It is instructive to contrast the approach of the media
companies with the approach of software companies in the digital world. As
we've heard many times in this debate, media companies claim to lose $3.5B per
year to piracy. But, software companies claim to lose $12B per year. Therefore,
one would logically expect the software companies to have the same reservations
about the digital medium that the media companies have. One would expect that
the software industry would be clamoring for government mandates like the media
industry. One would expect that the software industry would be shying away from
digital distribution like the media industry. But the software industry does not behave like the content
industry even though they suffer nearly 4 times the piracy. Unlike their media
company counterparts, software companies have generally chosen to embrace the
digital medium. A huge number of software titles are available for digital
download. Once downloaded, these software programs behave just like software
bought at the store. We believe it's important to ask why the software companies
who lose so much more to piracy embrace the digital medium while the media
companies claim that their business will be ruined if they embrace digital
delivery in its current "insecure" state? Along those same lines, it's important to ask why the
Business Software Alliance (an organization dedicated to detecting and stopping
piracy) does not support government mandated technologies for copy protection.
I believe the reason is that the software industry has been down this path
before and has found that it does not work. In the early 1980s, many major
software companies decided to implement strong copy protection schemes on their
products. They discovered two things. First, their schemes did not stop piracy.
Dedicated commercial pirates circumvented the copy protection. Second, their
copy protection alienated and infuriated paying
customers because the copy protection altered the expected behavior of the
software. For example, consumers could not back up their software, and if a
consumer upgraded his computer by buying a new one, they could not re-install
the software on that machine. Software companies discovered that treating all customers as potential
criminals was bad for business; it didn't stop theft and it alienated the
people who actually paid for their products. Instead of forcing technical solutions that inconvenienced
paying customers, the Business Software Alliance shifted to a strategy of
actually pursuing pirates. Today the
BSA investigates piracy allegations, conducts raids, and assesses large fines
on violators. Through the enforcement of existing law, the BSA has been
extremely effective at diminishing piracy in the United States. In short, computer security experts believe and software
history teaches that technical solutions will not solve the problem of piracy.
The only way to reduce piracy is to engage
the market by offering viable legal alternatives to consumers and to pursue the pirates, not the average
consumer. Conclusion Content providers have a right to pursue and prevent piracy.
However, law abiding consumers cannot have their personal use rights swept away
in the process. In order to protect consumers' rights from further erosion and
in order to ensure that any technical solution to content protection respects
consumer's fair-use rights, the members of DigitalConsumer.org urge this
Committee to make a positive assertion of citizens' personal use rights. The
vehicle is a set of principles we call the Consumer Technology Bill of Rights
and it is a statement of fair-use principles grounded in history, legislation
and the courts. After years of successful litigation and legislative
efforts, many in the entertainment industry are back in Washington asking for
more changes to the law. All the while,
they have been quietly developing services, technologies and products that
eliminate fair use for their customers, your constituents. Many in the copyright community will not
admit that there is such a thing as fair use. This denial persists despite 30
years of Congressional action and Supreme Court rulings affirming consumers'
fair use rights. And, while I am not a lawyer, I do know this much: consumers
believe they have personal use rights and they expect Congress to insure that
they are safeguarded. Before this Committee considers yet another change in the
law at the behest of the copyright community - a change in law that would make
"unauthorized" copying synonymous with piracy - I would respectfully urge you
to insure that the rights of consumers are protected and spelled out in the
legislation. Thank you very much for the time to address this committee today.
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