Pepsi/Amazon May Give Away a Billion MP3 Tracks (and Other Bad News for DRM)

According to Billboard, Pepsi and Amazon may start a promotion campaign during the upcoming Super Bowl that could give away as many as one billion MP3 tracks. It is also rumored that Wal-Mart will soon drop DRM-protected tracks in favor of the MP3 format. In reaction to these developments and the current availability of MP3s from EMI and Universal Music Group (this is a test), the Warner Music Group and Sony BMG Music Entertainment may consider distributing MP3s as well.

Read more about it at "Amazon 1 Billion MP3 Giveaway Offer; Under Pressure, Labels Warm To DRM-free Format" and "DRM Deathwatch: Sony, Wal-Mart."

Digital Rights Management and Consumer Privacy: An Assessment of DRM Applications under Canadian Privacy Law

The Canadian Internet Policy and Public Interest Clinic of the University of Ottawa Faculty of Law has released Digital Rights Management and Consumer Privacy: An Assessment of DRM Applications under Canadian Privacy Law.

Here's an excerpt from the report's "Executive Summary":

This report confirms that DRM is currently being used in the Canadian marketplace in ways that violate Canadian privacy laws. DRM is being used to collect, use and disclose consumers’ personal information, often for secondary purposes, without adequate notice to the consumer, and without giving the consumer an opportunity to opt-out of unnecessary collection, use or disclosure of their personal information, as required under Canadian privacy law.

Wired Shut: Copyright and the Shape of Digital Culture

The MIT Press has published Wired Shut: Copyright and the Shape of Digital Culture by Tarleton Gillespie.

Here's an excerpt from the author's description:

In Wired Shut: Copyright and the Shape of Digital Culture, Tarleton Gillespie examines this shift to "technical copy protection" and its profound political, economic, and cultural implications.

Gillespie reveals that the real story is not the technological controls themselves but the political, economic, and cultural arrangements being put in place to make them work. He shows that this approach to digital copyright depends on new kinds of alliances among content and technology industries, legislators, regulators, and the courts, and is changing the relationship between law and technology in the process. The film and music industries, he claims, are deploying copyright in order to funnel digital culture into increasingly commercial patterns that threaten to undermine the democratic potential of a network society.

RIAA v. The People: Four Years Later

With is focus on entertainment, digital audio/video file-sharing would appear to have little to do with digital scholarship; however, file-sharing is the canary in the digital copyright coal mine. Since the financial stakes are high, the legal battle over file-sharing is fierce, and it is where a growing body of digital copyright case law is being written. These rulings are legal precedents that may affect a wider range of digital materials in the future. File-sharing is also where the fate of digital rights management (DRM) is being largely decided, and this could have a major impact on future digital scholarship as well. That’s why I cover file-sharing legal issues in DigitalKoans.

The EFF has issued a new report, RIAA v. The People: Four Years Later, that examines the track record of one of the major legal combatants in the file-sharing war, the Recording Industry Association of America (RIAA).

Here's a brief excerpt from the report:

Are the lawsuits working? Has the arbitrary singling out of more than 20,000 random American families done any good in restoring public respect for copyright law? Have the lawsuits put the P2P genie back in the bottle or restored the record industry to its 1997 revenues?

After four years of threats and litigation, the answer is a resounding no.

Welcome to the DRM Zone: Case in Point, the Google Video Store

If you have ever purchased or rented a video from the Google Video Store, it will cease to function on August 15, 2007. That's because the Google Video Store is being shut down and along with it Google 's associated DRM system.

Customers will get credits in Google Checkout for what they spent on Google Video Store products, but not cash refunds, meaning that they must buy merchandise available via that service to recoup their losses. Of course, this does not compensate purchasers for the inconvenience of having to replace their videos (assuming that they can).

This fiasco underlines a key problem with DRM: it doesn't just restrict access, it restricts access using proprietary technologies, and, with few exceptions, those technologies cannot be legally circumvented under U.S. law.

Source: Fisher, Ken. "Google Selleth Then Taketh Away, Proving the Need for DRM Circumvention." Ars Technica, 12 August 2007.

Finnish Court Says DRM Has to be Truly Effective to Warrant Legal Protection

Although it is a lower-level court, a recent ruling by the Helsinki District Court has raised questions about whether DRM systems that can be cracked by easily available software warrant protection under Finnish and European Union copyright laws.

Here’s a excerpt from Mikko Välimäki’s analysis, "Keep on Hacking: A Finnish Court Says Technological Measures Are No Longer ‘Effective’ When Circumventing Applications Are Widely Available on the Internet":

In an unanimous decision given May 25, 2007, Helsinki District Court ruled that Content Scrambling System (CSS) used in DVD movies is "ineffective." The decision is probably the first in Europe to interpret new copyright law amendments that ban the circumvention of "effective technological measures." The legislation is based on EU Copyright Directive from 2001. According to both the Finnish copyright law and the underlying directive, only such protection measure is effective, "which achieves the protection objective." . . .

The background of the Finnish CSS case was that after the national copyright law amendment was accepted in late 2005, a group of Finnish computer hobbyists and activists opened a website where they posted information on how to circumvent CSS. They appeared in a police station and claimed to have potentially infringed copyright law. Most of the activists thought that either the police does not investigate the case in the first place or the prosecutor drops it if it goes any further.

To the surprise of many, the case ended in the Helsinki District Court. Defendants were Mikko Rauhala who opened the website, and a poster who published an own implementation of source code circumventing CSS. They were prosecuted for illegally manufacturing and distributing a circumventing product and providing a service to circumvent an effective technological measure. . . .

The decisive part of the process was the hearing of two technical expert witnesses. One was invited by the prosecutor and another was invited by the defense. Asked about the effectivity of CSS, they both held it ineffective from the perspectives of technical experts as well as average consumers. The court relied on the testimonies of the witnesses and concluded: ". . . since a Norwegian hacker succeeded in circumventing CSS protection used in DVDs in 1999, end-users have been able to get with easy tens of similar circumventing software from the Internet even free of charge. Some operating systems come with this kind of software pre-installed. . . . CSS protection can no longer be held ‘effective’ as defined in law. . . ."

EMI Offers Its Entire Digital Music Catalog Free of DRM

EMI, which ranks third in worldwide music sales, has announced that it will make it’s entire digital music catalog available without DRM (Digital Rights Management) protection via Apple’s ITunes.

Users will pay a modest premium for DRM-free tracks: $1.29 for new tracks and $.30 to free existing tracks from DRM.

Here’s an excerpt from the press release:

EMI Music today announced that it is launching new premium downloads for retail on a global basis, making all of its digital repertoire available at a much higher sound quality than existing downloads and free of digital rights management (DRM) restrictions.

The new higher quality DRM-free music will complement EMI’s existing range of standard DRM-protected downloads already available. From today, EMI’s retailers will be offered downloads of tracks and albums in the DRM-free audio format of their choice in a variety of bit rates up to CD quality. EMI is releasing the premium downloads in response to consumer demand for high fidelity digital music for use on home music systems, mobile phones and digital music players. EMI’s new DRM-free products will enable full interoperability of digital music across all devices and platforms.

Eric Nicoli, CEO of EMI Group, said, "Our goal is to give consumers the best possible digital music experience. By providing DRM-free downloads, we aim to address the lack of interoperability which is frustrating for many music fans. We believe that offering consumers the opportunity to buy higher quality tracks and listen to them on the device or platform of their choice will boost sales of digital music.". . . .

Apple’s iTunes Store (www.itunes.com) is the first online music store to receive EMI’s new premium downloads. Apple has announced that iTunes will make individual AAC format tracks available from EMI artists at twice the sound quality of existing downloads, with their DRM removed, at a price of $1.29/€1.29/£0.99. iTunes will continue to offer consumers the ability to pay $0.99/€0.99/£0.79 for standard sound quality tracks with DRM still applied. Complete albums from EMI Music artists purchased on the iTunes Store will automatically be sold at the higher sound quality and DRM-free, with no change in the price. Consumers who have already purchased standard tracks or albums with DRM will be able to upgrade their digital music for $0.30/€0.30/£0.20 per track. All EMI music videos will also be available on the iTunes Store DRM-free with no change in price.

EMI is introducing a new wholesale price for premium single track downloads, while maintaining the existing wholesale price for complete albums. EMI expects that consumers will be able to purchase higher quality DRM-free downloads from a variety of digital music stores within the coming weeks, with each retailer choosing whether to sell downloads in AAC, WMA, MP3 or other unprotected formats of their choice. Music fans will be able to purchase higher quality DRM-free digital music for personal use, and listen to it on a wide range of digital music players and music-enabled phones. . . .

EMI Music will continue to employ DRM as appropriate to enable innovative digital models such as subscription services (where users pay a monthly fee for unlimited access to music), super-distribution (allowing fans to share music with their friends) and time-limited downloads (such as those offered by ad-supported services).

"Strong Copyright + DRM + Weak Net Neutrality = Digital Dystopia?" Postprint

The "Strong Copyright + DRM + Weak Net Neutrality = Digital Dystopia?" postprint is now available.

The abstract is below:

Three critical issues—dramatic expansion of the scope, duration, and punitive nature of copyright laws; the ability of Digital Rights Management (DRM) systems to lock-down digital content in an unprecedented fashion; and the erosion of Net neutrality, which ensures that all Internet traffic is treated equally—are examined in detail and their potential impact on libraries is assessed. How legislatures, the courts, and the commercial marketplace treat these issues will strongly influence the future of digital information for good or ill.

If you would like a more detailed description, see my posting about the preprint.

Top Five Technology Trends

As usual, the LITA top 10 technology trends session at ALA produced some thought-provoking results. And, as usual, I have a somewhat different take on this question.

I’ll whittle my list down to five.

  • Digital Copyright Wars: Big media and publishers are far from finished changing copyright laws to broaden, strengthen, and lengthen the rights of copyright holders. And they are not yet done protecting their digital turf with punitive lawsuits either. One big copyright impact on libraries is digitization: you can only safely digitize what’s in the public domain or what you have permission for (and the permission process can be difficult or impossible). There’s always fair use of course, if you have the deep pockets and institutional backing needed to defend yourself (like Google does) or if your efforts are tolerated (like e-reserves has been so far, except for a few sub rosa publisher objections). In opposition to this trend is a movement by the Creative Commons and others to persuade authors, musicians, and other copyright holders to license their works in ways that permit liberal use and reuse of them.
  • DRM: The Sony BMG rootkit fiasco was a blow, but think again if you believe that this will stop DRM from controlling your digital content in the future. The trick is to get DRM embedded in your operating system, and to have every piece of computer hardware and every consumer digital device that can access and/or manipulate content to support it (or to refuse access to material protected by unsupported DRM schemes). That’s a tall order, but incremental progress is likely to continue to be made towards this goal. Big media will continue to try to pass laws that mandate certain types of DRM and, like the DMCA, protect its use.
  • Internet Privacy: If you believe this still exists on the Internet, you are either using anonymous surfing services or you haven’t been paying attention. Net monitoring will become far more effective if ISPs can be persuaded or required to retain user-specific Internet activity logs. Would you be upset if every licensed e-document that your library users read could be traced back to them? Unless you still offer unauthenticated Internet access in your library, that may depend upon your retention of login records and whether you are legally compelled to reveal them.
  • Net Neutrality: If ISPs can create Internet speed lanes, you don’t want your library or digital content provider to be in the slow one. Hope you (or they) can pay for the fast one. But Net neutrality issues don’t end there: there are issues of content/service blockage and differential service based on fees as well.
  • Open Access: If there is a glimmer of hope on the horizon for the scholarly communication crisis, it’s open access. Efforts to produce alternative low-cost journals are important and deserve full support, but the open access movement’s impact is far greater, and it offers global access to scholars whose institutions may not be able to pay even modest subscription fees and to unaffiliated individuals.

"Strong Copyright + DRM + Weak Net Neutrality = Digital Dystopia?" Preprint

A preprint of my "Strong Copyright + DRM + Weak Net Neutrality = Digital Dystopia?" paper is now available.

It will appear in Information Technology and Libraries 25, no. 3 (2006).

This quote from the paper’s conclusion sums it up:

What this paper has said is simply this: three issues—a dramatic expansion of the scope, duration, and punitive nature of copyright laws; the ability of DRM to lock-down content in an unprecedented fashion; and the erosion of Net neutrality—bear careful scrutiny by those who believe that the Internet has fostered (and will continue to foster) a digital revolution that has resulted in an extraordinary explosion of innovation, creativity, and information dissemination. These issues may well determine whether the much-touted "information superhighway" lives up to its promise or simply becomes the "information toll road" of the future, ironically resembling the pre-Internet online services of the past.

For those who want a longer preview of the paper, here’s the introduction:

Blogs. Digital photo and video sharing. Podcasts. Rip/Mix/Burn. Tagging. Vlogs. Wikis. These buzzwords point to a fundamental social change fueled by cheap PCs and servers, the Internet and its local wired/wireless feeder networks, and powerful, low-cost software: citizens have morphed from passive media consumers to digital media producers and publishers.

Libraries and scholars have their own set of buzz words: digital libraries, digital presses, e-prints, institutional repositories, and open access journals to name a few. They connote the same kind of change: a democratization of publishing and media production using digital technology.

It appears that we are on the brink of an exciting new era of Internet innovation: a kind of digital utopia. Dr. Gary Flake of Microsoft has provided one striking vision of what could be (with a commercial twist) in a presentation entitled "How I Learned to Stop Worrying and Love the Imminent Internet Singularity," and there are many other visions of possible future Internet advances.

When did this metamorphosis begin? It depends on who you ask. Let’s say the late 1980’s, when the Internet began to get serious traction and an early flowering of noncommercial digital publishing occurred.

In the subsequent twenty-odd years, publishing and media production went from being highly centralized, capital-intensive analog activities with limited and well-defined distribution channels to being diffuse, relatively low-cost digital activities with the global Internet as their distribution medium. Not to say that print and conventional media are dead, of course, but it is clear that their era of dominance is waning. The future is digital.

Nor is it to say that entertainment companies (e.g., film, music, radio, and television companies) and information companies (e.g., book, database, and serial publishers) have ceded the digital content battlefield to the upstarts. Quite the contrary.

High-quality thousand-page-per-volume scientific journals and Hollywood blockbusters cannot be produced for pennies, even with digital wizardry. Information and entertainment companies still have an important role to play, and, even if they didn’t, they hold the copyrights to a significant chunk of our cultural heritage.

Entertainment and information companies have understood for some time that they must adopt to the digital environment or die, but this change has not always been easy, especially when it involves concocting and embracing new business models. Nonetheless, they intend to thrive and prosper—and to do whatever it takes to succeed. As they should, since they have an obligation to their shareholders to do so.

The thing about the future is that it is rooted in the past. Culture, even digital culture, builds on what has gone before. Unconstrained access to past works helps determine the richness of future works. Inversely, when past works are inaccessible except to a privileged minority, it impoverishes future works.

This brings us to a second trend that stands in opposition to the first. Put simply, it is the view that intellectual works are "property"; that this property should be protected with the full force of civil and criminal law; that creators have perpetual, transferable property rights; and that contracts, rather than copyright law, should govern the use of intellectual works.

A third trend is also at play: the growing use of Digital Rights Management (DRM) technologies. When intellectual works were in paper form (or other tangible forms), they could only be controlled at the object-ownership or object-access levels (a library controlling the circulation of a copy of a book is an example of the second case). Physical possession of a work, such as a book, meant that the user had full use of it (e.g., the user could read the entire book and photocopy pages from it). When works are in digital form and they are protected by some types of DRM, this may no longer true. For example, a user may only be able to view a single chapter from a DRM-protected e-book and may not be able to print it.

The fourth and final trend deals with how the Internet functions at its most fundamental level. The Internet was designed to be content, application, and hardware "neutral." As long as certain standards were met, the network did not discriminate. One type of content was not given preferential delivery speed over another. One type of content was not charged for delivery while another wasn’t. One type of content was not blocked (at least by the network) while another wasn’t. In recent years, "network neutrality" has come under attack.

The collision of these trends has begun in courts, legislatures, and the marketplace. It is far from over. As we shall see, it’s outcome will determine what the future of digital culture looks like.

Cato Institute Report Denounces DMCA

The Cato Institute has released a report (Circumventing Competition: The Perverse Consequences of the Digital Millennium Copyright Act) that is sharply critical of the Digital Millennium Copyright Act (DMCA).

The following quote is from the executive summary:

The result has been a legal regime that reduces options and competition in how consumers enjoy media and entertainment. Today, the copyright industry is exerting increasing control over playback devices, cable media offerings, and even Internet streaming. Some firms have used the DMCA to thwart competition by preventing research and reverse engineering. Others have brought the weight of criminal sanctions to bear against critics, competitors, and researchers.

The DMCA is anti-competitive. It gives copyright holders—and the technology companies that distribute their content—the legal power to create closed technology platforms and exclude competitors from interoperating with them. Worst of all, DRM technologies are clumsy and ineffective; they inconvenience legitimate users but do little to stop pirates.

And this quote is from the conclusion (links are mine):

When the next breakthrough media device is invented, its inventor should not face a legal system in which the deck is stacked against him, as Streambox and DeCSS did. He should be free to focus on hiring the best programmers, designers, and marketers, rather than on shopping for a good law firm. If industry incumbents attempt to prevent his product from working with theirs, he should be allowed to circumvent the restrictions as Accolade did in the Sega case. And if the device has a "substantial non-infringing use" and is developed and marketed for such use, Congress and the courts should uphold its legality, even if it threatens the business model of an established industry.

The Sony BMG Rootkit Fiasco Redux

There’s a new development in the Sony BMG Rootkit story (for background see my prior posting and update comment): Sony BMG has reached a settlement (awaiting court approval) regarding the class action lawsuit about its use of DRM (Digital Rights Management) software after virtual "round-the-clock settlement negotiations" (on December 1st numerous individual lawsuits were given class action status). The short story is that XCP-protected CDs will be replaced with DRM-free CDs and customers will be given download/cash incentives to exchange the disks; no recall for MediaMax-protected CDs, but buyers will get song MP3s and an album download. You can get details at "Sony Settles ‘Rootkit’ Class Action Lawsuit."

Since my December 4th update comment, there have been a few articles/blog postings of note about this controversy. "Summary of Claims against Sony-BMG" provides an analysis by Fred von Lohmann of EFF of "the various legal theories that have been brought against Sony-BMG over the CD copy-protection debacle." In "Sony CDs and the Computer Fraud and Abuse Act," Ed Felten considers whether Sony BMG, First4Internet, and SunnComm/MediaMax "violated the Computer Fraud and Abuse Act (CFAA), which is the primary Federal law banning computer intrusions and malware" (he notes that he is not a lawyer), and, in "Inside the MediaMax Prospectus," he highlights some interesting aspects of this document. "New Spyware Claim against Sony BMG" describes a new claim added to the Texas lawsuit by Attorney General Greg Abbott: "MediaMax software . . . violated state laws because it was downloaded even if users rejected a license agreement." Finally, "Just Let Us Play the Movie" examines the fallout for the film industry and DRM use in general.

In other recent IP news, two items of interest: "France May Sanction Unfettered P2P Downloads" (mon dieu!) and "Pro-Hollywood Bill Aims to Restrict Digital Tuners."

The Sony BMG Rootkit Fiasco

When Mark Russinovich posted "Sony, Rootkits and Digital Rights Management Gone Too Far," he helped trigged a firestorm of subsequent criticism about Sony BMG Music Entertainment’s use of the First4Internet’s digital rights protection software on some of its music CDs. It was bad enough that one of the planet’s largest entertainment companies was perceived as hacking users’ computers with "rootkits" in the name of copy protection, but then the EFF posted an analysis of the license agreement associated with the CDs (see "Now the Legalese Rootkit: Sony-BMG’s EULA"). Things got worse when real hackers started exploiting the DRM software (see "First Trojan Using Sony DRM Spotted"). Then the question posed by the EFF’s "Are You Infected by Sony-BMG’s Rootkit?" posting became a bit more urgent. And the lawsuits started (see "Sony Sued For Rootkit Copy Protection"). Sony BMG suspended production (see "Sony Halts Production of ‘Rootkit’ CDs"), but said it would continue using DRM software from SunnComm (see "Sony Shipping Spyware from SunnComm, Too"). Among others, Microsoft said it will try to eradicate the hard-to-kill DRM software (see "Microsoft Will Wipe Sony’s ‘Rootkit’").

What would drive Sony BMG to such a course of action? Blame that slippery new genie, digital media, which seems to want information to not only be free, but infinitely mutable into new works as well. Once it’s granted a few wishes, it’s hard to get it back in the bottle, and the one wish it won’t grant is that the bottle had never been opened in the first place.

Faced with rampant file sharing that is based on CDs, music companies now want to nip the rip in the bud: put DRM software on customers’ PCs that will control how they use a CD’s digital tracks. Of course, it would be better from their perspective if such controls were built in to the operating system, but, if not, a little deep digital surgery can add lacking functionality.

The potential result for consumers is multiple DRM modifications to their PCs that may conflict with each other, open security holes, deny legitimate use, and have other negative side effects.

In the hullabaloo over the technical aspects of the Sony BMG DRM fiasco, it’s important not to lose sight of this: your CD is now licensed. First sale rights are gone, fair use is gone, and the license reigns supreme.

Pity the poor music librarian, who was already struggling to figure out how to deal with digital audio reserves. Between DRM-protected tracks from services such as iTunes and DRM-protected CDs that modify their PCs, they "live in interesting times."

While the Sony BMG fiasco has certain serio-comic aspects to it, rest assured that music (and other entertainment companies) will eventually iron out the most obvious kinks in the context of operating systems that are designed for intrinsic DRM support and, after some bumps in the road, a new era of DRM-protected digital multimedia will dawn.

That is, it will dawn unless musicians, other digital media creators, and consumers do something about it first.

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