July 21, 2003
Volume 1, Issue 2
One of DCIA's functions is to inform our constituents
about issues affecting the growth of distributed computing.
This week's newsletter is dedicated to the US House
of Representatives Judiciary Committee hearing held
Thursday July 17th on the proposed "Piracy Deterrence
and Education Act of 2003" - H.R. 2517. This bill
is intended to enhance criminal enforcement of the
copyright laws, educate the public about the application
of copyright law to the Internet, and clarify the authority
to seize unauthorized copyrighted works.
Our purpose in reporting about the hearing on H.R.
2517 is to encourage your involvement in the formulation
of DCIA's position on this bill, which has generated
much media interest and is relevant to our industry
dialogue.
Response to legislative proposals will normally be
taken up first by DCIA's Executive Committee, with
balanced representation from Platform, Operations,
and Content Groups, and then ratified by our full Membership.
As you know, we are currently in the process of recruiting
representative Charter Members and, until we complete
that process, will secure broad input on such matters,
as we are doing here.
Comments during the hearing were made and/or questions
raised by Subcommittee Chairman Smith, H.R. 2517 co-author
Congressman Berman, and Representatives Boucher, Keller,
Weinstein, and Wexler.
Testimony was given by the FBI's Jana Monroe, Professional
Photographers of America's David Trust, Skinner Sisters'
Linn Skinner, and Universal's Maren Christensen.
Hearing Summary
Chairman Smith opened by discussing the issues of
new laws being sought when existing ones aren't
being
enforced, the RPI case possibly causing a reduction
in piracy at other universities, the NBC Today
Show's sympathetic depiction of the parent of a
file-sharer,
and commending the FBI for its role in The Hulk
case.
Congressman Berman stated that government intervention
may be necessary when egregious infringers have more
resources than individual copyright holders 'to turn
the ship around before pirates scuttle it,' that the
FBI is the appropriate agency to warn online infringers,
and that this bill (Section 6) seeks to clarify criminal
suit authorizations for protecting unregistered works,
because most of the revenue of many pop-culture offerings
is derived close to the time of their launch, and piracy
of pre-completed works can eviscerate most of their
profits. He outlined additional proposed companion
legislation, H.R. 2752, focusing on international cooperation
in prosecuting piracy, making the felony criminalization
threshold a single file upload (based on $250 X 10
copies), measures to expose spyware and false domain
registrations, and the requiring of consent for data
storage on one's PC.
Monroe's testimony echoed the subcommittee's estimate
that more than two billion files are now transferred
monthly, currently representing widespread piracy,
and underscored consumer security and privacy risks
in using P2P technologies. She reported that the FBI
has seen an increase in backdoors and bots installed
on consumer PCs. Monroe said the FBI believes deterrence
and education are the first two actions to be taken,
and said the FBI is close to having a deal with the
RIAA to put its seal on certain music files as a warning.
She said the FBI also intends to distribute nationally
a letter advising of the dangers of P2P networks. Monroe
outlined the FBI's Cyber Division two-tracked approach
to crimes that have migrated to the web and those that
are unique to it, and its three-part mission to investigate,
educate, and lead in this area, internationally as
well as domestically. She noted there are 60 cyber
squads and that the FBI receives approximately 9,000
cyber crime complaints monthly. She stressed the importance
of cooperation between the FBI and the private sector
on high-tech crimes.
Trust's testimony emphasized the value to small independent
photographers of IP protection for unregistered works
as proposed in H.R. 2517, because with production volume
of 20K photos per year, it is burdensome for photographers
to complete the copyright registration process.
Skinner, an embroiderer, spoke anecdotally of her
experience using an alias with an online group of embroidery
pattern infringers who taunted her to commit acts of
infringement to prove her worthiness to be included
in this group, describing an underworld of illegitimate
activities, replete with double-agent trolls, etc.
Finally, Universal's Christensen said that piracy
is the greatest single threat to content providers
and that P2P has increased piracy. She outlined how
80% of shows don't pay for themselves requiring the
20% that are profitable to carry the weight of supporting
the industry, and how pirates only exploit the hits
without making an investment. She provided a narrative
of The Hulk case and how the FBI and Universal worked
together to prosecute a felony copyright infringement.
Christensen stated that Universal and MPAA hope H.R.
2517 "will foster legitimate Internet distribution
and business models" by attacking piracy through "consumer
education and deterrent penalties."
Following a recess, Chairman Smith noted that a problem
with law enforcement generally is that it is not favorable
to "the little guy."
Monroe further discussed the FBI's Cyber Crime Division's
dual focus on the invasion of PCs and copyright violations,
re-emphasized the importance of public-private alliances
to fight piracy, and outlined the registration application
process for US copyrights.
Representative Berman further discussed the proposed "single
upload" felony criminalization threshold.
Monroe outlined the FBI's three-pronged effort: investigation,
education, and training, cited "the dangers of
P2P technology," and further addressed the use
of the FBI seal as a warning.
Congressman Boucher indicated that he had several
problems with the bill. He drew a distinction between
addressing inappropriate uses of P2P technology vs.
condemning P2P technology itself. He said he had a
problem with the use of the word "unauthorized," which
as the bill is worded could inadvertently outlaw legitimate
access of content via the Internet by consumers, and
recommended substituting the word "unlawful." He
questioned whether the FBI was the appropriate agency
to be assigned a consumer education program. He asked
more broadly whether this bill as drafted would not
deny consumers "fair use" of content. Finally,
he asked whether implementation of the provisions of
this bill were doable with current resource allocations,
since the bill did not propose appropriating any new
money.
Representative Wexler asked what Congress could do
help the FBI. He drew a distinction between the "uploading" and "downloading" of
unauthorized content, indicating that "uploading" is
the greater problem to address.
Christensen added that Universal endorsed the ability
to begin proceedings in cases of unregistered content.
Congressman Weiner said that what was remarkable about
The Hulk case was that it was remarkable at all. He
questioned the view that there is no deterrent now
because the government is not taking the issue seriously.
He asked how long it would take an average person to
find an unauthorized movie to download, noting that
attendees sitting on the sidelines at the hearing using
laptops could probably access one even while he spoke.
He asked what the FBI would propose to do upon discovering
such activity. He questioned whether the FBI was currently
prepared for the volume of cases that such a bill would
surface, and how many undercover cases were in process.
Chairman Smith concluded the hearing thanking participants
for their contributions.
Your Input
Given DCIA's charter to advance the commercial development
of distributed computing, the hearing on this prospective
legislation raises questions for our members and
prospective members.
These are not meant to be rhetorical, but rather are
posed as real questions for you to answer to help formulate
DCIA's position. Please feel free to answer in long
or short form. All replies will be kept confidential.
For your reference, H.R. 2517 can be accessed at http://thomas.loc.gov/cgi-bin/query/z?c108:h.r.2517: and a link to the webcast of the hearing will be provided
as soon as available.
Do you agree that the balance of value creation by
widespread adoption of file-sharing via peer-to-peer
networks has swung far to the side of consumers who
are enjoying the benefits, and that major adjustments
are required so that value can also accrue to content
rights holders and technology providers? (Yes / No
/ Comment _____________ _____________________________________________________________________)
Is there a valid distinction to be drawn between abuses
of distributed computing technologies and those technologies
themselves? (Yes / No / Comment_____________ _____________________________________________________________________)
Or, as several speakers asserted during this hearing,
are these technologies themselves the core problem
and is there no legitimate distributed computing industry
to be developed at this time? (Yes / No / Comment_______________________________
_____________________________________________________________________)
Should we declare all unauthorized consumer copying
of copyrighted works from the Internet at this time
as criminal as this bill suggests? (Yes / No / Comment___________
_____________________________________________________________________)
Should there first or also be legitimate offerings
of digital media files made widely available via P2P
distribution so that consumers could choose desirable
conduct, before or in addition to focusing in depth
on methods for attempting to discourage their undesirable
conduct? (Yes / No / Comment___________________________________
_____________________________________________________________________)
What business steps would have to be taken so that
Christensen's testimony would have been, "To an
increasing degree, our on-line business is accomplished
through peer-to-peer distribution systems where one
copy of a film can be made available almost instantaneously
to millions of users around the globe." Instead
of, "To an increasing degree, on-line piracy is
accomplished through peer-to-peer distribution systems
where one illicit copy of a film can made available
almost instantaneously to millions of users around
the globe?" (Comment________________________________
_____________________________________________________________________)
Similarly, what would be a reasonable expectation,
based on the subcommittee's reported levels of 2.3
billion peer-to-peer digital media file-sharing transactions
monthly, of music rights holders in terms of monthly
revenue that could be generated by working with technology
providers? (Comment_______________________________________
_____________________________________________________________________)
Are there precedents in this proposed legislation
that you believe would inhibit the growth of legitimate
business models for distribution of digital media by
participants working together in this nascent industry,
for example, through DCIA's auspices? (Yes / No / Comment
_________________________________________________________)
What are the appropriate applications of education
and deterrence and at what stage would they be most
effective in the advancement of the distributed computing
industry? (Comment_____________________________________________________________
_____________________________________________________________________)
Does this bill go too far and/or is it premature in
engaging elaborate legal processes to intrude in private
consumer behavior, absent reasonable alternatives?
(Yes / No / Comment_____________________________________________________________)
Is there a practical concern given the volume of consumer
activity? I.e., using the subcommittee's metrics, 1-out-of-10
of the 2.3 billion digital media files now shared monthly
is an upload qualifying for felony treatment, meaning
that there could be 230,000,000 cases in the first
month of enactment versus 9,000 monthly cyber complaints
now. (Yes / No / Comment_______________________________________
_____________________________________________________________________)
Should the FBI be involved in collecting data on consumer
practices without search warrants, and is its issuing
of related warnings as contemplated here appropriate?
(Yes / No / Comment________________________________________________________)
Are these measures constitutional? (Yes / No / Comment________________________
_____________________________________________________________________)
Is expending FBI investigational resources on consumer
home recording activity desirable? (Yes / No / Comment____________________________________________
_____________________________________________________________________)
Will adding IP specialists to anti-hacking units of
the FBI improve the effectiveness of either activity?
(Yes / No / Comment_________________________________________
_____________________________________________________________________)
Is it advisable to permit utilization of the FBI seal
on certain copyrighted content but not on others? (Yes
/ No / Comment____________________________________________
_____________________________________________________________________)
How can these distinctions be fairly drawn? (Comment__________________________
_____________________________________________________________________)
Is not all such content copyrighted when created under
U.S. law? (Yes / No / Comment_ _____________________________________________________________________)
Should the FBI seal be placed on all domestically
produced content? (Yes / No / Comment_____________________________________________________________)
What is your view on this bill's intention to protect
unregistered works? (Comment_____ _____________________________________________________________________)
Might a requirement for dissemination of private sector
security keys to law enforcement officials make DRM
systems less secure than they might otherwise be? (Yes
/ No / Comment _____________________________________________________________)
Does the proposed involvement of the Attorney General
in copyright education programs create a conflict with
that office's responsibility to be a law enforcement
advocate in judicial proceedings? (Yes / No / Comment__________________________
_____________________________________________________________________)
Would this lead to compromising one or the other of
these endeavors? (Yes / No / Comment_____________________________________________________________)
Does this proposed legislation counter basic established
consumer "fair use" rights to privately make
and use recordings of content? (Yes / No / Comment________________
_____________________________________________________________________)
Finally, in trying to put this proposed legislation
into a broader perspective, if such a law had been
passed twenty years ago, as some proposed at the time,
against personal use of consumer video and audio recorders,
would the legitimate businesses derived through the
use of these technologies have developed into the robust
industries they have become? (Yes / No / Comment_________________________________________
_____________________________________________________________________)
Do you see a parallel with the distributed computing
industry? (Yes / No / Comment___ _____________________________________________________________________)
What differences do you see? (Comment_____________________________________
_____________________________________________________________________)
Is there another more appropriate analogy? (Comment__________________________
_____________________________________________________________________)
Please e-mail your responses to as many of these questions
as you care to answer, and send other recommendations
to help define DCIA's position with respect to this
proposed legislation to marty@dcia.info or call 888-864-DCIA.
For membership information, please contact karen@dcia.info.
To suggest research topics, please contact rick@dcia.info.
To provide input into our weekly newsletter, please
contact jason@dcia.info. We greatly value your input,
and look forward to serving your needs. Thank you very
much.
|
