Here we'll explore the nexus of legal rulings, Capitol Hill
policy-making, technical standards development, and technological
innovation that creates -- and will recreate -- the networked world as we
know it. Among the topics we'll touch on: intellectual property
conflicts, technical architecture and innovation, the evolution of
copyright, private vs. public interests in Net policy-making, lobbying
and the law, and more.
Disclaimer: the opinions expressed in this weblog are those of the authors and not of their respective institutions.
About a week after its bizarre attempt to make the Xbox One as gamer-hostile as possible and in the face of a slew of criticism from all sides Microsoft has publicly climbed down from the ledge and said it now sees reason. In a news post on the Xbox.com site, the company announced a reversal of its previous policies requiring always-on Internet and doing away with its obstacles to used games - at least, used games with discs. Since gaming discs are going the way of the dodo that's not a huge change. The status of region-locking is less clear - the posting says you can "take your Xbox One anywhere you want" but the region lock was based on the company's hosted service Xbox Live not offering certain titles in certain countries. That appears still to be in place, in which case EU regulators may want to have a word with Redmond. Again.
Now comes SiDi, a technology that claims to be fighting copying but in fact is creating illegal works. Here's the deal: an e-book with SiDi (and please help me resist making jokes about inSiDious here) has been subtly changed. Words are replaced with equivalents, creating a kind of "watermark" for the e-book that renders it different from the original. If that watermarked version later finds its way out into the wild you know what the original source was. So far so good - in fact, Margaret Thatcher once used a similar technique to figure out who in her cabinet was leaking memos to the press.
However, unlike Ms. Thatcher, SiDi doesn't own the works it's distorting. In fact, what it is doing is creating a derivative work, and passing that derivative off as the original. Now it may not make a huge difference if you read a work where the author's word "unhealthy" is replaced by SiDi's "not healthy" but the law clearly gives the copyright holder the power to determine what changes are and are not permissible. Changes, even minor ones, can create a derivative work. And if you create an unauthorized derivative work, then you've committed a copyright violation.
Worse, if you create a derivative work and pass it off as the work of the original author, you've committed a fraud. What may seem to you or me to be a trivial change may in fact upset an author who has gone to significant trouble to shape the wording of, say, a particular character's dialog. That dialog helps the reader build a mental picture of the character, and the wording of the story sets the pace and flow - all of which we expect the author to control. If you've never watched an author and a copyeditor fight over seemingly trivial wording changes then this may not strike you as a big deal but I have, and trust me it matters. Authors care about the fine details of their craft and having some piece of software go in and arbitrarily change those fine details is a violation of both the spirit and the letter of almost every publishing contract I've seen.
In her column, Susan Lulgjuraj asks the question of whether we've gotten to the point where e-book copying is so widespread that we need yet another form of DRM to combat it. That presumes that this form of DRM will be any more effective than all the other forms, which is to say not at all. And it misses the most crucial question, which is why are we even contemplating something this stupid?
(Image above of Bến Tre - bonus points to anyone who can guess the relationship of that image to this story, without searching first.)
Pitched as a piece about income inequality, it takes off from a talk by Princeton economist Alan Krueger in which he argues that “The music industry is a microcosm of what is happening in the U.S. economy at large." More depressingly, it appears that the technology that ought to be democratizing and spreading wealth is instead contributing to this distortion. That, and simple luck.
Technology plays its part by spreading the most popular (and most produced and most solidly funded) material the most widely. You're simply more likely to be exposed to the already popular stuff because money buys the tech that gets it out there. As it always has, I think.
Luck comes in because of network effects. People will (despite their protestations to the contrary) tend to gravitate to things that appear popular. If you have the good fortune to get early downloads, early thumbs-up, and appear to break from the pack first you are going to gather more attention, more downloads, more likes and the spiral is going to build. Technology factors into that by making the entire system of downloading and rating more visible, which drives more herd behavior and so on.
Like in fashion there's no IP protection for comedy. You can't copyright a joke, and it's certainly true that many performers use each others' material. Sometimes that's conscious, sometimes it's accidental. The public may even hear about or know people who make a living writing comedy material for well-known humorists like David Letterman or Jon Stewart. However, this has led to what Oswalt identifies as a massive public misperception - that all comedians "steal" and that "nobody" writes their own material.
In fact, the majority of working comedians write, or try to write, their own humor. A comedian's value is a combination of the material and the delivery. Some people are good writers but lousy performers; some people can really hold an audience, but produce poor original material. But as in any other career the people who are bad at one thing either get better at it or they get out of the business. Maybe they hire writers, or pay for stage coaching, but either way the goal is for them to produce more and better original acts.
Along the way, though, they have to deal with the people Oswalt identifies as the thieves. People who scoop up another comedian's jokes wholesale, sometimes even to the point of copying entire segments of someone else's act and then passing it off as their own. Without the ability (or money) to protect their work, comedians often have no choice but to wait until the thieves flame out. If you're stealing someone else's material to help you move up eventually you're going to reach a level where you're expected to produce. If you don't have original material then you can't produce, and you flame out, much like any other person who has cheated their way through life.
It's an interesting way to think about illegal (or at least unwanted) copying: can we create situations in other areas where unwanted copying isn't policed by restrictive technologies (DRM) or by restrictive laws (CISPA/TPP), but contains within itself the seeds of its own demise?
Microsoft seems to be all about the DRM with its latest entry into the consumer market. It is now confirmed (here reddit dissects the official Xbox Twitter feed) that only 21 countries will be able to use the console on launch. Notably this "region coding" splits up the EU - most countries are in but some are out - and it also excludes Poland, the development home of The Witcher game series, a title Microsoft touted in its E3 launch presentation. Yes, that's right, the developers of this Xbox launch title will not be able to play the game they developed. I generally find it wise to assume that Microsoft are not stupid, but whatever their plan is, it's eluding me here. Sony was quick to announce that its competitive product, the PS4, would not be region-locked.
Probably the most surprising thing to me was that SCOTUS managed to craft a single unified opinion in Association for Molecular Pathology v. Myriad Genetics, Inc. Given the complexities at issue and the previous rulings from the Court, I expected another split decision. It's even odder that they issued a unanimous ruling that both sides see as a victory (though that may be lemonade-from-lemons for Myriad). My sense is that they did so by a combination of punting the hard issues - no method claims were adjudicated - and unfortunately through a lack of understanding of the science.
By "right" I refer to the idea that the decision could reflect a legal and social sense of what is the right thing to do with patents in biology. For example, Art Caplan has a short opinion piece up stating bluntly that "natural DNA" never should have been judged patentable. Allowing Myriad to hold patents on these specific genes led to a tight monopoly market where no one could bring out a competitive (and one hopes lower-priced) testing product. This exemplified the monopolistic and constricted outcome feared by people who argued that natural biology should not be patent-protected.
This sounds to me like the Court has finally come around to Breyer's view in which the validity of an intellectual property protection law or interpretation has to be done in light of its outcomes. When you make a regime that allows one company to monopolize all possible methods of testing you've done something wrong. When you create a way for multiple companies each to protect their competitive ways of testing you've done something right.
Now if they could only manage to ground that in good science.
Ball looks at the cost of Netflix producing original content, and in particular what do those costs pay back in terms of building Netflix's subscriber base. This is a natural follow-up to Netflix's recent restart of Arrested Development. The show built up a following while it was on Fox but those who still want more now go to Netflix to get it. Ball goes deep dive, calculating things like Netflix's cost-per-minute and then comparing the value of paying Netflix solely for a specific piece of content you want (like Arrested Development) versus paying for other kinds of specific desired content such as a first-run movie.
These are great numbers, but I think they fundamentally miss what's going on, as Felix Salmon analyzes in his blog post today. I don't think anyone calculates the cost-per-minute of an entertainment offer, even subconsciously. The question is really can I get what I want there, and how much am I paying for what I want? Sure, some of the ongoing wave of cord-cutting is due to people not wanting to pay for big packages in order to get the specific content they're interested in. But that's big-view stuff, not the numbers that Ball is analyzing.
Salmon makes three points I think are worth keeping in mind. One is that original content is not just there to draw new subscribers - it's also a way to keep current subscribers. Netflix suffers from tremendous subscriber churn and the cost of acquiring subscribers has to be high.
Two is that Netflix is essentially bent over a barrel by the Cartel right now. If they appear to be making more money, then the broadcasters just hike the license fees to siphon off that revenue. Ball notes that Netflix had to pay fees of over USD 1.3 billion (yes, billion-with-a-b) in just the first quarter of this year. And I'm sure those fees are going to go up. No matter how expensive it may be to produce original content Netflix can be sure that it alone has control over that expense and isn't going to turn around and find its costs have doubled next quarter because of someone's external decision.
Third and finally, Salmon argues that Netflix isn't playing a quarter-to-quarter or even year-long game. Here's the money quote:
[Netflix wants] to become HBO faster than HBO can become Netflix
Exactly. HBO, with its disastrous response to demand for Game of Thrones, showed how badly it misunderstands new media models. Netflix isn't exactly an agile start-up, but they have the potential to beat HBO at this game if the cable giant sits back and continues to do nothing. With a library of high-quality original (again, licensing-free) content on hand, Netflix will be in a much stronger position to keep customers engaged and paying those all-important subscription fees.
Of course, Apple claims that it was not in collusion and is calling various publishers' representatives to testify about that. Unfortunately for DOJ it sounds like their own witnesses - also from the publishing houses - are making Apple's case by agreeing that there was contention between Apple and the publishers over how e-books would be priced. It seems clear that everyone was out to destroy Amazon's 9.99 price barrier, but I'm not enough of a lawyer to know if that agreement alone will be sufficient to sustain the government's contention.
As Shara Tibken noted, the publishers are going to argue that they went to Apple more or less out of necessity. Amazon, in its turn, is going to claim that it was forced to do this or that by the big bad publishers and you know what? The whole lot of them remind me entirely too much of misbehaving kindergartners. I have absolutely no sympathy for any of the parties in this mess.
This isn't really a core Copyfight story but it's too good to pass up: Fuzz Hogan for Zocalo explaining why CNN can't tell good stories, yet has rising profits year over year. We've been hammering at the idea that old business models are disintegrating and media giants need to evolve to survive and guess what? CNN has done just that. It's set up a system that gets it a nice chunk of change by producing crap, but crap that gets used and reused and paid for. Good stories are nice but if they don't bring in the money they won't happen.
There's a great big glob of information officially released by MSFT about its next-gen console, dubbed Xbox One. The nanny features are extensive, particularly for gaming. Your console has to be able to verify legitimacy with home base at least daily or you get locked out of all your games. If you sign into your Xbox Live account from any other console it checks once per hour. So no rooting, no hacked games, and no games that aren't MSFT-approved. The definition of what's "approved" changes whenever MSFT decides it should and if it doesn't like what you're doing, it'll remotely brick your hardware for gaming. And gods help you if Microsoft's authentication servers happen to hiccup when your box phones home to authenticate.
Wu suggests the use of consumer-protection laws, specifically targeting unfair or deceptive practices. The definition of "unfair" varies wildly since all states and the Feds have such laws. Wu notes also that some NPEs have misrepresented "...the strength of their patents, the extent of other settlements, and their actual willingness to litigate." I'm not sure what it means to misrepresent the "strength" of a patent - presumably Wu is referring to the scope of valid claims or the applicability of the claims to the supposed infringement. Certainly deliberate misrepresentation should be treated as fraud, but I'm not sure how hard it would be to prove deliberate misrepresentation.
Settlements and willingness to litigate, though, are clearly outside the bounds of these laws. I recommend the Planet Money podcast from last week on the patent being asserted against podcasting in which Zoe Chase gives a good view of the "game" played around all civil legal actions. Knowing whether or not someone else will carry through on a threat to sue is a standard feature of this sort of brinksmanship everywhere, not just patents.
Wu then suggests using unfair-competition laws against NPEs who aggregate patents. The idea that assembling a patent portfolio might be a Sherman Act violation when that portfolio is used to stop people from operating a business is certainly a novel theory. I know even less about antitrust law than I do about IP law, but I'm inherently dubious. On the other hand, the RICO laws have been used in ways far beyond their original targets so perhaps the courts will see fit to extend the scope of the Sherman or Clayton Acts in this way.
Wu also suggests that the FTC get into the act, through its power to manage competition and prevent monopolies. Section 5, which Wu points to, seems to target unfair or deceptive practices. This is interesting in that it might be a way to rule out an entire style of business practices. As we've discussed in the past, the use of patents for offensive versus defensive purposes is a matter of the owner's choice; however, the FTC has the power to rule that certain offensive uses of patents are sufficiently anticompetitive as to be illegal. I would be very interested to see the FTC hold hearings on this and air some expert opinions. Right now they're gathering comments and who knows what will follow. That said, any move by the Feds to change how patents are able to be used would almost certainly be challenged in the courts in cases that would drag on for years.
Unfortunately, although Wu notes that patents have been issued with "extreme leniency" (which is quite some understatement) he doesn't advocate for the kinds of changes necessary to prevent patent offal in the first place. Whether or not you like Wu's suggested remedies they are just that - remedies. Far better to fix the problem than clean up the mess afterward.
The place where I agree with Wu most strongly is where he argues that the reasons arrayed against these arguments are not reasons for inaction. Instead they call for proceeding with caution. Patent practices - both issuance and use - are in severe need of reform to keep up with new business practices and changing technology.
The sad truth is that this has been the case for pretty much all of human history. Creative types of all sorts have been shunned, kicked out of town at dusk, hired, fired, or even killed at patrons' whims, thrown in gaol for offending the rulership with their latest portrait or play - the list goes on and on. The view that Kennedy expressed - which later led President Johnson to create the National Endowment for the Arts - is a nice idea but a historical anomaly.
Buckell is, by most accounts, doing pretty well. He's making money by publishing his stuff, both through traditional and new-media means. He's been nominated for a fistfull of awards, which means his stuff gets reviewed, and appears in places like New York Times bestseller lists, one of the traditional measures of publishing success. He is, by some metrics, an "average" selling author; however, as he shows pretty clearly there's a huge difference here between "average" (the summed midpoint) and "median" (the most likely point). In fact, the median sucks, which means that e-publishing sucks for the vast majority of people.
What survivorship bias says is that our impressions will be skewed by unusual tales, which obscure the general reality. We read about one author who is making that 100k and we don't realize how unusual he is. For every Konrath there are hundreds of thousands of other e-book authors who are working hard and not getting enough money to pay the rent and keep the lights on. Again, that's just normal history but Buckell is concerned that because we're in this other historical anomaly, those people are getting doubly victimized.
If you're not selling well in e-book now, the tale goes, it must be your fault, somehow. You didn't try hard enough. You didn't use the right publisher or the right advertising medium or the right pricing model. You didn't land in the top 100 so your experience doesn't have meaning, when in fact it's the other way around. Those top 100-selling authors are the anomalies. They're doing well and that's great. But that doesn't make them more meaningful or relevant examples than an average 100 e-book author, or a median-100 e-book author.
Buckell does have one important point that I think deserves to be thought about harder: he says he's playing the long game and I think that's required here. There are a few true overnight sensations, but when you dig deeper you find that a lot of people who have suddenly broken out did so after years of hard work and building up to that breakout moment. So if you're a creative type, good on you. Do the hard work, try to be successful now but if you're not don't take it as a personal flaw - take it as confirmation that you need to play a longer game.
In fact, Rancourt's body text is more circumspect than his lede, saying "...we might be heading into a world where streaming killed the cable star". Yeah, maybe. It's true that online subs cost less, and it's true that Netflix's latest numbers look good, though profits remain elusive. The kicker is still original content which right now is looking good for Netflix and causing other streaming sites to jump in with both feet. That doesn't automatically spell demise for cable, though, which still holds important trump cards like exclusive live sporting content and first point of access for traditional broadcast channels.
Rancourt thinks we'll see major shifts in digital entertainment in the next few years. I disagree - I think we're going to see several years of tentative experimentation as companies hunt for profitable models and advertisers try to figure out how to deal with the extreme audience fragmentation that online streaming brings. It's always possible someone will come along with a game-changing plan, but my bet is that the next few years look more like a muddle than a major shift.
The core idea of this treaty is that people who can't read print or access printed books would be allowed to get some kinds of access for things like education, employment, and so on. The US is actually pretty good about this but for some reason (*cough*money*cough*) the Administration is going about poisoning this treaty so it can't benefit people outside the country but will enrich the MPAA.
Here's the money quote:
[The treaty now says, i]f a book is commercially available in an accessible format, it can't be provided by a library to a person with a disability. This is equivalent to walking into a public library and finding padlocks on all the books with a note that says: "If you want to read it, buy it."
That's not right and it's something I don't think librarians should be silent about. Librarians here in the US have generally been pretty awesome about helping people get access to information - despite frequent official machinations to the contrary - and I'm willing to bet you care about the same principles outside our country's borders. In particular I'm hoping you share my belief that it's wrong for our administration to be forcing lockdowns on libraries in the name of corporate profits.
Amazon Strikes Another Deal That Is Good for Amazon
While I'm waiting for the dust to settle and clarifications to be clarified I suggest you read John Scalzi's "Instant Thoughts" blog post on Amazon's new "Kindle Worlds". Scalzi points out what immediately occurred to me, which is that this is a very good deal for Amazon and probably not such a good deal for other participants. It's also nice that he notes the public domain as an alternative.
Rather than panic, though, she (following the lead of Michael Weinberg, who works for Public Knowledge) advises lawyers to "look to the past before trying to sue the disrupting technology out of existence." Noting that the scorched-earth plan didn't work so well for the Cartel as it tried to stop digital music, Weinberg suggests "...companies would be better off taking a lesson from history and seeking ways to profit from 3-D printing."
How novel! How refreshing! How totally sane. I don't think anyone doubts that 3D printers represent major disruption in both manufacturing and IP law. But disruption doesn't mean disaster, especially if people take the time to plan and prepare. And that includes IP lawyers.
People may recall that when the Whitehouse.gov petition on unlocking got enough signatures to require a response, the Administration said "yes, we support that but we can't do anything about it because the Librarian is part of the Legislative branch, so sorry." And in fact, that appears to be the Librarian's position as well, as the posting quotes Congressional testimony from the Librarian saying, for example, that the office is “a unique part of the Legislative Branch of the government.”
the Library of Congress is “an executive Department,” and the Librarian himself is “subject to plenary oversight by the President.”
ORLY? Why would they want to argue that? Because, as the cell-phone case shows, the Librarian has been vested with authority to execute - that is, carry out the enforcement of - copyright legislation. This is done via the Librarian appointing the Registrar of Copyrights and the judges of the Copyright Royalty Board. And the Administration wants that to continue because this provides them a convenient arm's-length distance from the mess that enforcing those laws is creating.
It's pretty well understood by Constitutional scholars that such appointment powers should reside only with the Executive. Congress can advise and consent, including blocking appointments over which it has advisory power, but the Legislative branch under our government cannot take the initiative to appoint those people who will execute the laws, nor those who sit in judgment over them. Congress hears nominations for judicial offices on the basis of Executive-branch desires to appoint, and that includes judges of copyright.
As noted above, this case is still only at the petition stage, but there's hope that if SCOTUS takes it, the Court will unravel this knot by making a clear decision. Once they do that it will be clear that the Administration has the power to enforce copyright laws and they will no longer be able to weasel out of public demand for changes in how enforcement is done. New legislation to fix the underlying laws is still welcome, but this case could create a bright line that will force Obama to choose between the public and his Cartel funders. Sadly, I have a suspicion he'll end up on the wrong side of that line again.
I don't plan to write much about this because I know the named defendants and many of the John Does personally but I wanted to point out how Masnick's column illustrates something important: If you are involved in an IP-related legal action, get a lawyer who knows that part of the business. Monsarrat's lawyer-partner Mark Ishman apparently does not, which results in a serious, and epic-level funny takedown from lawyer Dan Booth. Booth and his firm Booth Sweet LLP (not LLC as printed) have been involved in fighting the Prenda nonsense and thus know a thing or two about copyright laws and their abuses.
A significant chunk of the takedown involves Booth schooling Ishman, who is no doubt a fine lawyer in his own area but appears not to know jack squat about copyright law. If you've got IP litigation on your mind, make sure you've got IP-savvy counsel, too.
The basic idea is that if someone makes a video of themselves playing a Nintendo game and uploads it to YouTube any ads shown with that video will be of Nintendo's choosing and revenue from it will flow to Nintendo. Ads may appear beside the videos or actually be inserted before and after the video when people go to play it.
The problem here is that "Let's Play" style videos are a pervasive form of information and sharing throughout the industry. I did a quick YouTube search for "let's play" for this blog post and got back over 9.1 million hits. People create these videos to show off their skills, to highlight interesting things they've seen such as game "easter eggs", to provide guides or walk-throughs, or just to share a bit of fun with friends. There are a few professional or semi-professional games writers who use this style of video to promote themselves or their channels, but they are a tiny minority of that nine million.
Nintendo has positioned its action as a gentler approach; rather than trying to ban content related to Nintendo games, they just want to make money off it by changing the video that an individual uploaded. Yeah, um, guys that's not a whole lot better. It also comes across as cheap and lazy - rather than creating content for YouTube that fans and players would want to watch, Nintendo is just taking over other peoples' content.
Museums are somewhat infamous for trying to stop people taking pictures of famous paintings on display. Some museums forbid flash photography with the argument that thousands of flashes would inevitably damage works that are often carefully hung with special lighting and protective surfaces. But, really, stopping me taking a snap of a modern steel sculpture? What's going on there?
The very bigness of the deal may be compelling a change. Back in the day it was just one guy with a camera in hand; now it's everyone with every cellphone and point-and-shoot. Trying to police all of them is both taxing on limited museum resources and ultimately futile anyway. So, according to Miranda, museums are loosening their policies and trying to become part of the social media conversations themselves, publishing Tumblrs and having their own Instagrams.
Enter copyright. Museums often restrict their open-access photography to their permanent collections, over which they tend to have complete control. But loaned and traveling exhibits, which can be the biggest draws, often come with copyright restrictions and photos published online - even if non-commercially - can be considered infringing derivative works. To combat this, museums need to work directly on these rights issues with the holders; for example, they can negotiate exemptions that permit non-commercial reproduction while agreeing to help rights-holders track down people who are trying to make money off the photos.
Miranda's column doesn't discuss one area that I think is crucial: public education. Given that we are constantly bombarded by messages in movies, on TV, on DVDs, etc that all reproduction is bad, I believe it's an important part of this mission to help people understand what is and is not allowed. Might we even say, "teach about fair use"?
The story starts with how the T shirt's hue is copied (or inspired by) predictions of trending influences, and elements like colors that are associated with those influences, and goes into a discussion about how the entire fashion industry lives around a copying and imitation model. This is, from a conventional protectionist-thought school, heresy. IP protection exists, protectionists would say, in order to encourage innovation. IP protection gives innovators time to reap benefits of their work. Without such protection, what is the incentive to create?
Well, in fashion, it appears that not only is there incentive to copy - everyone wants to get on the popular trends - there's incentive to differentiate. You want to be identified with a look, or group, or crowd, but not be an identical Mao-suited clone. So innovation begins as variations on a theme, and grows into whole new trends, all without the benefit of much IP protection.
It's an interesting story and challenges us to remember that most of what we consider today to be great works - from the plays of Shakespeare to the sculptures of Michaelangelo - were created in eras when intellectual property protection was unknown or much weaker. Remembering that, we have to wonder whether IP protection truly serves to promote innovation, or simply to promote profit on innovation. Both are important, but they're not the same thing and that's worth keeping in mind.
The 'yes' side was written by Martin Goetz, himself an inventor and entrepreneur. So far as anyone can tell, Goetz holds the first-ever software patent. The 'no' side was written by Brian J. Love, an IP law professor from Santa Clara University School of Law. So far as I can tell, Professor Love does not actually litigate or make patent applications, so this is sort of a mismatch of real-world practitioner versus theorist. I guess it won't surprise many readers that I consider the real-world practitioner to have the stronger arguments.
In particular, Goetz makes the singular point that "software and hardware are interchangeable" and that it's an implementation decision which bits of an invention go in software versus which bits go in hardware. This remains the key point I have yet to see anti-software patent people argue clearly against.
Goetz is, I think, one-sided in claiming purely that patents are effective protection for innovations. Here Love is on more solid ground as we have ample real-world examples of patents (software and otherwise) being used to stifle innovation and that the rapid pace of technological innovation is not suited for the more leisurely and extended protection that patents offer. Goetz might, I think, agree in principle but as a pragmatist he points out that there are no other means available. Both men agree that the system is flawed and needs fixing.
There are two proposals starting the crawl toward daylight, both of which could reshape our interactions with certain digital media and devices. Unfortunately, while one would move us forward, one would be a giant step back. Let's look at both.
We now have a supposedly independent standards body, which ought to be acting in the best interest of the net community and the Web itself, acting to promote useless and harmful solutions to problems nobody but big content companies wants "solved". As the EFF pointed out in its petition to W3C, the purpose of the consortium is to promote openness, not standardize controls on people's content, nor promote a playing field for DRM plug-ins.
The bill (PDF copy here posted by EFF) would implement a couple of common-sense measures as exemptions built into the law, rather than requiring repeated requests for exemptions. First, the law would be changed to say that if you're doing something legal then it's still legal even if you have to get around DRM to do it. In essence, it narrows the bill's definition of what constitutes "circumvention" so that people who want to do things we agree ought to be legal (such as jailbreaking a cell phone) can do that. In fact, phone unlocking is called out specifically in the bill's new list of exempt activities.
In addition, the bill would specifically allow people to make and sell devices (programs) that circumvent digital locks for legal purposes. The canonical example of this, of course, is the program that lets you unlock your e-book so it can be accessed by an audio reader. Vision-impaired book readers rejoice! Reading a book via a device that converts it to audio has always been legal for printed books, but DRM locks stopped that on e-books. Under this bill, the purpose of the circumvention would be a key factor - you still won't be able to break DRM in order to make illegal copies.
Finally, the bill sets up a time clock and requires reporting on Section 1201's "effectiveness." One of the facts noticed when the whole cell phone kerfuffle blew up is that the DMCA itself predates cell phones. It's possible that the bill requires further revision as technology progresses so gathering further data seems like an excellent plan.
There has been a lot written already about last week's Court of Appeals for the Federal Circuit "decision" in CLS Bank v. Alice Corporation and I'm sure there's more to come as people dig into the details of the full house of opinions.
First a bit of background for those new to this game: CAFC is supposed to be the highest court in the land when it comes to patent matters. It's true that their decisions can be appealed to SCOTUS - and lots of commenters are hoping SCOTUS takes this one if only to restore some illusion of sanity - but mostly their decisions stand. Frankly, the Supreme Courts' rulings in recent patent cases don't give me any reason to believe they'd be any help here.
As the highest patent court, CAFC ought to be bringing clarity to the situation, setting out good guidelines that people can follow to know if their inventions are patentable and how to draw up valid patent claims. Whether you are pro- or anti-software patents, you want to know what the rules of the game are. This decision is like the CAFC is playing Calvinball with different rules depending on which judge you read.
We got no more than five judges of 10 agreeing on anything. Those who claim this is a victory for one side or the other are smoking something. The CAFC itself seems to have been desperate to come up with something to say en banc so they said it but who the heck knows what it will apply to. I'm sure we'll see endless interpretations and re-interpretations as lower courts struggle through this.
Some commentators have blamed the problem on there being only 10 judges and the fact that judicial nominees are being held up, including for CAFC. It's possible that if more judges had been available we might have emerged with a true majority opinion, but I tend to doubt it. The problem I see is rooted in the laws themselves, with which the judges continue to struggle. As I noted back in the Mayo decision discussion, judges seem to confuse 35 U.S.C. 101 and 35 U.S.C. 103. These two sections of the code try to specify what is patentable, but don't set out criteria anyone seems able to understand or follow. And computers just make it worse.
The 101 criteria is supposed to bar things that are 'abstract'. Back in the day when there was a nice distinction between "ideas" and "machines" this made sense. If someone had an idea they couldn't patent that; when they built a machine that operated based on their idea, the machine was the thing they went to patent. Then along came computers and pretty much everything became both abstract (programs, code, algorithms) and non-abstract (programs, code, machines) at more or less the same time. Trying to determine how 101 applies to computer programs, systems, machines, and operations is what leads to messes like this.
If I had my way I'd wave my magic wand and repeal 101 entirely. It feels like 102 and 103 are sufficient to give us guidance and I can't imagine that simplifying the laws would lead to worse outcomes than we have today. This might not make happy those people who want to ban software patents and think 101 is required for that, but I don't think we're making progress in that direction and certainly we're not making coherent progress in any direction.
On the surface CopyTele looks like a typical NPE, asserting a couple of encryption-related patents against Skype, which Microsoft owns. CopyTele, as a small company, doesn't have the resources to sue a larger company which can afford to pay lawyers to keep patent claims tied up for years before any trial. This is a common technique big companies use to fend off smaller claimants - just run the smaller companies out of money and the problem goes away.
CopyTele is no white knight - they're overtly out to make money - but at the moment they're the only way that the little guy has of getting anything for their work. Like a lot of companies, CopyTele was not very good at making and marketing products. Having a good and novel idea - good enough to get a couple patents at least - is not the same as being able to thrive in business. CEOs make bad decisions, recessions happen, investors get cold feet - the list of reasons for a company with a good idea to fail goes on and on.
So what else are they to do? Closing up shop and vanishing is certainly going to happen, but that leaves the question of what to do with the company's good ideas. If they can - through the NPE - make some money off them, should that automatically be disallowed? I tend to think not. If we assume that the patents are good and validly granted then they represent the embodiment of innovation and hard work. For another company to make use of that innovation and hard work CopyTele ought to be able to get some form of compensation, such as by sale or license. Which brings us back around to the patent monetization entity.
A long time ago I made an analogy between patents and cars. Certainly people use cars to commit crimes. Cars are responsible for a lot of deaths. People use cars in all kinds of irresponsible ways (hang up the damned phone and drive!). But none of that causes us to want to abolish cars. Likewise, I do not think that the abuses of some NPEs are a reason we ought to abolish patents, software or otherwise. But surely some sort of (possibly stringent) regulation is required.
I name this test in honor of Greg Aharonian of PATNEWS who has been raging about the crap coming out of the USPTO for longer than I've been blogging. The test is simple: if it fails at its most basic function, it's not suitable material for patent discussion.
In an email sent out today Greg has pointed out that the PTO's database of its own patents fails this test. The patent database is both accessible to the public and used by examiners. As I noted last time, one reason we might point to for bad patents being issued by the PTO is that examiners do not have adequate tools to do their jobs properly.
This query asks for patents where (at least one of) the inventors are in the country of Panama. Go ahead, give it a try. I'll wait.
Right, so if you're like Greg and me you'll notice that the PTO's database fails to perform even this simple query properly. Some of the answers appear to be because of substring matching (bad implementation of the search algorithm); others appear to be because of incorrect data in the patent records themselves (bad quality control). Regardless of the cause, it's clear that this tool fails here, which leads one to wonder how badly it fails on other queries. If patent examiners aren't finding relevant prior art maybe we ought to give them the right (tested) tools and (quality supervised) data to make that possible, eh?
This has been well-covered elsewhere. I just wanted to point out - thanks to Ken White at Popehat - that the Judge clearly understood how Prenda were taking advantage of the horrible state of copyright law in the US. "[Prenda] discovered the nexus of antiquated copyright laws, paralyzing social stigma, and unaffordable defense costs [...] So now, copyright laws originally designed to compensate starving artists allow, starving attorneys in this electronic-media era to plunder the citizenry."
The suit seeks a declaratory judgment that Aereo does not infringe CBS's copyrights, which is what the 2nd Circuit said. The suit is filed in New York in part because that's where the original suit was tried and because part of Aereo's complaint is that by threatening to sue everywhere, CBS is both "venue shopping" and trying to evade the ruling against it in the original court. In general courts look poorly on those kinds of legal shenanigans so they may well get their declaratory judgment, but I don't think that's going to stop CBS.
The list of news topics about laws and problems grows week by week: computer intrusion laws being overbroad, DMCA exemptions not being granted for everyday activity with technologies, patent trolling, maximalist copyrighting - all ultimately come down to the laws' failure to keep pace with the rapid evolution of technology and online social/commerce activities. A pair of recent news stories makes it look like Congress might actually be gearing up to do something.
However, a review such as this is almost certain to include public hearings, which provides an opportunity for organizations concerned about how badly the Obama administration has handled these issues to get their grievances heard, and garner some publicity. It's one thing to careen from crisis (CISPA) to crisis (TPP) and another to be able to present a coherent view of what a modernized IP regime should look like. Hearings are the place to do that.
Over on the patent side, Senator Charles Schumer announced his intention to file a bill addressing patent trolling. His idea is to expand the realm in which defendants can ask for PTO review of patents before trial. That's not particularly novel, and again fails to address the problem of bad patent issuance, but it is a step in the right direction. PTO review is often directed by courts or requested after courts have invalidated some or all of a patent's claims. Clogging up the PTO with more reviews isn't going to help, but if this works right the number of reviews will remain about the same and companies (and the public) will be spared the time and expense of some IP-related litigation.
The site got knocked offline by a barrage of spam comments. Thanks to Hylton and the Corante staff for cleaning up the mess and getting us moving again. There are two entries now published that were from May 3rd and I'll work on clearing the backlog tomorrow and the rest of this week.
It's important to remember that despite its meteoric rise in the past few years, self-publishing is not (yet?) a true alternative to major publishing houses. It's a complement. Publishers are often focused on 'name' authors, and blockbuster publications that can get placed on visible list like the NY Times Bestsellers and can bring in large dollars. That shuts out a lot of smaller-audience and specialty publications that can do quite well in the self-published marketplace. So, yay self-publishing, particularly since that avenue tends to be DRM-free from the word go.
But we have not yet seen any other big publisher follow in Macmillan/Tor's footsteps and that's just ridiculous. Look, guys, DRM isn't helping you, it isn't securing you any sales, and it is locking you in and your customers out. Cut that out.
First, the patent office (examiner) should be finding this prior art. Why that's not happening is complex, but a first approximation would be that the examiner isn't well enough trained, doesn't have enough time to examine each application thoroughly, and doesn't have enough or adequate tools at hand. All three of these causes have been discussed on various boards and blogs frequented by examiners. The solutions are pretty obvious, and any attempt at patent reform that doesn't discuss examiner training, production quotas, and available search tools is defective from the start.
Second, the patent applicant is supposed to conduct an adequate prior art review themselves and should be liable for submitting patent applications without such reviews. In fact, the way the law is set up rewards deliberate blindness. Since you have to disclose any prior art you know about, it's safer not to know about any prior art. The result is a raft of idiotic submissions made with completely inadequate prior art information. We know this to be the case because a reasonably competent person with access to Google, Medlib, or the Science Citation Index can often find something not disclosed on the patent application.
This problem is less straightforward to fix. Increasing penalties for bad prior art disclosures only reinforces the willful ignorance problem. I've suggested before that any application with zero non-patent prior art citations should be rejected out of hand by the USPTO. That would cut out a large chunk of the obvious crap but doesn't encourage the positive behavior we all want, which is inventors doing good thorough searches before applications. My social-software nerd brain thinks we ought to let the USPTO develop some kind of reputation system, and allow applicants with good reputations to get priority examinations, but it would take a fair bit of work to design a fair reputation system that was resistant to gaming by people both outside and inside the Patent Office.
On release day, Greenheart not only put up legitimate copies but a "cracked" version on a popular torrent site. Unfortunately for those who took the torrented free version over the for-pay legal version, the crack disguised a hidden logic bomb. Those who played the cracked version found that their in-game studios constantly went bankrupt due to piracy. People complained about it on various gaming boards and got a large round of "no duh" and other kinds of head-slaps.
This was, of course, a not particularly subtle jibe at those whose taking of free copies of games is harming independent developers. Indies often have to front a good deal of their own money to develop a title and if it doesn't sell they take the loss. Indies also tend to have fewer and lower-cost titles on offer, meaning their revenue streams can be hurt much more by lack of sales - whether that's due to bad reviews, bad gaming experiences, or illegal copying.
Unfortunately, the experiment suffered from being highly atypical. Most indie games are released through third-party services such as Steam or Green Man Gaming and this one was only available to Windows 8 users via Microsoft's service, or to people who knew about the game and went directly to Greenheart's own Web site. This severely limited the possibility of legally acquiring the game and so the comparisons of absolute numbers of legal downloads versus pirated are probably not representative.
A friend pointed me to an alarmed posting in the British Journal of Photography. The column, by Olivier Laurent, outlines the potential highly negative impacts particularly for photographers of a new copyright framework that is wending its way through the British legal approval process.
The original goal of the framework is laudable: find a way for people to be able to make use of orphaned works - those items presumed to be under copyright but whose owners cannot be located. As copyright terms continue to be extended more and more work exists in this weird limbo state - someone has the rights, but may not even know it or be interested in defending those rights reuse of these works wouldn't harm anyone, but is still forbidden by the default copyright regime.
Unfortunately, it appears from Laurent's summary that this initial intention has been implemented in a particularly dangerous way for photographers and this has led to a large group of people and organizations concerned with photography - everyone from the Thomson Reuters news agency, the massive Getty and Corbis image archives on down - to try and stop this framework from becoming law.
The issue seems to be that the framework does not contain strong enough requirements on someone who wants to determine if a photograph is orphaned. In particular, it appears that an absence of photographic file metadata may be taken as indicating an image is not copyrighted. Even if the text of, say, a blog post using an image contains copyright/ownership information, image searches often present the pictures in a context-free way so you don't see that annotation. To make matters worse, many popular sites that allow photographic uploading deliberately strip out metadata as part of the upload process (Twitter and Facebook to name just a couple).
Given that we cannot rely on metadata being present, even if the photographer put it there and wants it to remain, it seems like a poor idea to base a decision on orphan status on these metadata. Unfortunately, few alternatives exist. There are registration services and even apps springing up, but nothing with the sort of wide acceptance that would be needed for efficient copyright holder search.
Who, sadly, deserves it. This is sad because I used to like Lanier. Back in the ancient days, when rocks were soft, I did a little work in virtual reality. I respect the pioneering work that Lanier did in that field. Sadly, he seems to have turned into a cranky old damned-kids-get-off-my-lawn type these days, trading on his past good work to sell books about the impending collapse of things he cares about, and peddle nonsense in major magazines.
Lanier's piece is an excerpt for his latest crank manifesto and it's just astonishingly full of wrong. People who are knowledgeable in one field are not automatically knowledgeable in others - as I so often prove. Here (and apparently in the book this column is excerpted from) Lanier shows that he really doesn't understand economics. In order to understand just how badly Lanier gets it wrong let me point you to this that's-not-actually-true.-at-all. dept column from Mike Masnick at Techdirt.
It's long, but a worthwhile read as Masnick goes point by point over several of Lanier's key economic mistakes and shows why these mistakes lead him to be totally wrong about things like digital music. This reminds me of David Lowery, who at least has serious music cred but who also takes a nearly entirely wrong approach to understanding the future evolution of digital music.
Where Masnick scores his best point - and where Lanier does so much worse than Lowery - is where Lanier appears to want to rewrite history (Masnick calls him out for "lying") and that's really a shame. People may not be able to be expert in every field, but good smart people ought to know better than this.
Quick reminder: fair use is not an absolute doctrine. Rather, it's a series of tests and criteria applied to a reuse that might be copyright infringing to determine whether infringement applies. Different courts have used different sets of criteria or weighed them differently, and interpretations have shifted over time. For example, recently it has been much harder to get fair use protection for parody and other humorous forms of commentary.
In this case, the question was whether Judge Batts's criteria that a reused work must somehow be "transformative" was an acceptable fair use test. Her ruling was generally acknowledged to be somewhat novel and raised concern particularly in the art world where reuse of images is common. It was particularly troubling as the case at hand concerned work by artist Richard Prince, who created new works of art based on photographs from a book. Prince's works were found infringing at trial level based on this new criteria, but his conviction is now overturned.
Using Aereo's odd business model as a jumping-off points, Salmon looks at the reality that what we currently think of as "broadcast" television channels are currently getting more revenue from retransmission fees paid by cable companies than from direct advertising (though he doesn't provide data, which would be nice - anyone got those numbers?). If that's really true then these companies could potentially just shut down broadcasting which would kill Aereo without having to win court battles. Doing so would also give them more leverage with the cable companies.
If broadcasters aren't going to use that spectrum, who will? Salmon believes that the spectrum will be auctioned off and bought mostly by cell and wireless data providers. This would, he says, "create more value." I'm not sure for whom this value would be created, though, and I should point out that as long as high-speed Net penetration in the US remains as crappy as it is (not universal, non-competitive, and stupidly expensive) then the idea of just handwaving away broadcast looks remarkably parochial. Sure, if you live in NYC like Salmon does (or near Boston as I do) then the loss of broadcast isn't something you'd notice. Drive an hour or two away from those major metro hubs, though and you bet there are a lot of people who would be well and truly pissed off if broadcast suddenly vanished.
I got a press release from Aereo today indicating that they are going to launch in Boston in mid-May. Significantly, this is outside the Second Circuit, where Aereo recently won its appeal. If I was a betting man I would bet that this will be an invitation for the broadcasters to file a new round of lawsuits in hopes of finding a friendlier ruling and creating a variance in opinions that could pressure the Supreme Court to revisit the 2nd's decision.
I haven't yet read Judge Stanton's opinion this time around, but the fact that it was only 24 pages indicates that he found what the TV lawyers call an "open and shut" case. Had there been complexities or nuances the Judge likely would have issued a lengthier ruling so his reasoning could be reviewed by the higher courts to which Viacom is sure to appeal. Sadly, Viacom has already stated their intention to re-appeal this. We can only hope that the 2nd Circuit will slap them down again and maybe finally they'll decide it's better to spend their money on developing better business models than on massive lawyer fees.
Vernon recounts her own experiences as a self-published author, as an author who has worked with publishers, and as a comic artist. Although she resists drawing bigger conclusions I think her primary thought - there is on one true right way - jibes with what we've explored in this blog. We find ourselves still in the infant stages of both these kinds of publication and it's a mistake to draw too many definitives out of the air just yet.
Vernon's other point I noted is that fans are having a disproportionate effect here. We've noted how fans of some artists - most famously Amanda Palmer - have made the artist's efforts successful well beyond expectations, but what Vernon is talking about is how fans of a genre or artform can shape or stifle debate and particularly criticism. That's a serious problem, not just for the people being criticized or shut down but for our ability to judge, compare, and improve these infant forms.
Take out the word 'software' and I'd be in complete agreement. Bad software patents have gotten a lot of attention lately but rules for reforming patent examination and issuance need to be universal. You can't just single out bad software patenting practices and ignore errors if they are happening in hardware, biotech, etc. The EFF do focus on a problem that is endemic to software patents - overbroad claiming. In most other fields of patent arts it's necessary for the invention to be narrowly described and for the patent only to protect the specific claims. For example, if I patent a medicine to cure headaches I am given protection only on the specific medicine I disclose in the patent, not on the entire field of headache cures.
The post also renews EFF's earlier calls for source-code submission, with which I sympathize but I think will make more trouble than it solves. For example, what language(s) will be accepted? And how will you prove that two source code submissions are or are not equivalent? I haven't looked lately but I think proof of program equivalence is an NP-hard problem to solve. Really, though, you don't care about the code. You care about the algorithm the code implements, and we have some pretty well-understood ways to describe algorithms without reducing them to specific code forms. Yes, it may take a certain level of skill to understand non-textual algorithmic representations but we ought to expect the examiners of software patent applications to be able to read those, just as we expect other examiners to be able to read mathematical equations, or chemical reaction formulae.
Patent "Monetization" Entities... Which is to Say, Trolls
A study report out of UC Hastings College of the Law reports that "patent monetization entities" - called "trolls" in the headline - filed 56% of patent lawsuits last year, more than double the percentage of five years ago. Hear that, Apple? You get cracking now! On a more serious note, the study also looked at public notification systems and determined that they are woefully inadequate. People and companies are not able to find out when patents are being asserted in lawsuits, which deprives them of the chance to avoid infringement.
Unfortunately, bad as they are, they appear to be at least surface-level legitimate, though Mullin has some fascinating background about just exactly who these guys are that have been hired to carry out the collection part of the plan. This brings me back to the point I keep harping on, which is that we created this mess ourselves and we're not going to fix it until we take serious steps to reform the patent-issuing process itself. Radical things, like hiring more (and more qualified examiners), permitting summary rejections of trash that is clearly intended just to clog up the system and drag everything out, establishing compulsory licensing regimes, and preventing Congress from filching the fees that the USPTO extracts and that ought to be used to fund most of these improvements. Crazy stuff, I know.
It's possible that Books on Board will find new financing to handle its debt problems and remain in business somehow, but I'm not hopeful. Until we break the DRM lock-ins and hardware dependencies that are endemic to the ebook business right now there's just not a lot of breathing room for people who aren't making hardware onto which the books can be locked.
(thanks to Doug Pardee for the pointer to the decision PDF)
Sullivan's ruling appears to rest on his belief that Redigi in fact creates new copies of the digital files, despite its efforts to avoid doing so. Creating a new file would of course be an infringement and thus would not invoke the first-sale rights. The Reuters story indicates that Sullivan's ruling takes this into account - specifically Kirtsaeng - but the question still remains. If Redigi can attack the core conclusion of making a copy, they may still be able to operate under first-sale doctrine.
Unfortunately, Redigi does not have big-name deep-pockets backers like Aereo so if they are going to continue this fight it's going to be an expensive proposition. At press time they weren't revealing their next move, but honestly they're going to be on the hook for big bucks no matter what since Capitol is sure to press for large damage sums at this point.
Somewhat to my surprise, Mike Schroeder of Aereo wrote to me today to let me know that they had won a round at the Second Circuit. Specifically, the Circuit ruled that there was no evidence that the Cartel was likely to prevail at trial which would support a preliminary injunction.
This means things move forward on two fronts: without an injunction that would shut it down, Aereo is free to go on building its business. However, as Stelter points out in that Times story, the next step is almost certainly for the studios and networks that wanted the injunction to go to trial. Just because two of the Second Circuit's judges didn't feel an injunction was warranted is no guarantee of a win at trial and even if Aereo wins there it will almost certainly land back at the Second as the Cartel will appeal a loss again. As I noted last year, this case appears to be bringing the nutcases out of the woodwork, but I don't think the Cartel is being particularly nutty here. They're just trying to use their deep pockets and shark teams of lawyers to wear down Aereo and its backers.
I'm pretty sure I'm indebted to Warren Ellis for this pointer: The Private Eye comic. It's a story-based comic by Marcos Martin (Daredevil, Spiderman, art) and Brian K. Vaughan (Saga, Ex Machina, writing) that is being put out in DRM-free, pay-what-you-think-it's-worth style. You can preview on the site, or direct download the unencumbered files. The creators are quite honest with a simple pitch: you pay us to make this comic and we'll make more. There's no charity or fancy rewards. This makes it much more like NoiseTrade, except for visual artistry. It's refreshing to see more people trying out these new models and I wish Martin and Vaughan well. If their creative style appeals to you (and I think many Warren Ellis fans will see the connections) then click the big blue "Buy Now" link at the bottom.
The only thing I'd like is a little more clarity in pricing. It would be nice to see a suggested price, or average price paid information (a la Humble Bundle). This series could go up to 10 issues, at 32 pages per which is a pretty hefty output but it's not clear whether you're paying now for the premier issue or subscribing for the whole series. Obviously people are free to choose the option that they like, but guidelines and suggestions would help me, I think.
David Post, writing at Volokh Conspiracy on the Kirtsaeng decision, is worth quoting entirely: The Court – in a utterly brilliant opinion by Justice Breyer, a minor classic of the “here are all the reasons why my arguments are better than yours” school of opinion-writing — rejected Wiley’s argument and refused to impose the geographical restriction Wiley sought.
Thayer wasn't happy about being asked to work for free, and posted the editor's request along with some heated response, highlighting his career as a professional journalist not to mention his need to pay bills, feed his children and so on. In general, Thayer noted, "[I] am not in the habit of giving my services for free..."
Thayer's public scolding brought a number of responses, two of which I want to visit, and to draw parallels with other things here and elsewhere. First up, Cord Jefferson wrote a piece for Gawker, which brings up an important point: who's really paying?
When people work for free, particularly in businesses like writing, they are often able to do so because they have other resources they can draw on. A "day job" or friends and family can provide the financial resources necessary for someone who isn't able to get paid at writing to pursue that vocation. Crucially, external financial resources may enable someone to tolerate the zero- or low-wage situations that interns and freelancers find themselves in and that then lead them to the higher-paying or even salaried opportunities. Jefferson points out (I think correctly) that this unacknowledged dependence on outside resources leads to a self-selection process whereby people who have access to those resources (coarsely, to a rich family) get those opportunities whereas those who come from lower economic status are denied them. People in lower economic status are much more often non-white or single working parents - which is to say, women. Since they do not have the resource cushion to survive on the "work for prestige" rungs of the ladder they are thereby denied the opportunity that more well-off (and more often white male) people have. Thus the "work for free" regime acts to perpetuate racial and gender inequalities.
So far so good. Unfortunately the last two paragraphs of Jefferson's essay go off the rails as he chooses to misinterpret and attack Amanda Palmer and her TED talk. First of all, calling Palmer "wealthy" is almost certainly factually incorrect. But more importantly, Jefferson claims that Palmer's talk is promoting the ideas "...that artists should be willing to work for free." Say what? Certainly that's not how I or most other respondents I've read heard that talk, which seemed to me to be encouraging people to ask for things, including money.
Leaving aside the last two paragraphs, I also want to highlight the response from Ta-Nehisi Coates who happens to be Black and has the singular point of view of writing regularly for The Atlantic. Coates' reply column was titled 'Lucrative Work-for-Free Opportunity' and told his own story of receiving a similar offer to the one that offended Thayer. Coates was solicited by Matt Yglesias to write for The Atlantic in exchange for the greater exposure rather than for a by-the-word payment rate. Like Thayer, Coates was an established writer at the time and also like Thayer he was a struggling professional with bills to pay.
Coates took the offer, negotiating his ability to commit to what Yglesias wanted with his own need to publish his own things. He highlights the fact that this is common practice in the industry, but also calls Thayer's tactics (such as publishing private emails with names attached) into question. Yes, Coates says, it would be nice if the industry could provide more living-wage positions to alleviate the kinds of disadvantaged situations that Jefferson talks about. But it's also true that right now The Atlantic is employing more journalists than ever before.
Which leads to the point of this long-winded think piece: it's a continuation of our discussion of what it means to be an author in the 21st-century media environment. We've been conditioned to think of a "successful" artist as one who sells a million records or has a million followers/fans/readers/whatever. But if you price your offerings right (as Felix Salmon argues and I agree) then you don't need the superstar/megahit/blockbuster model to be successful. Palmer's Kickstarter gets mentioned for its dollar amount a lot - Jefferson highlights its dollar totals - but few people seem to notice that there weren't that many people backing it. A few tens of thousands. That's a highly replicable model - at least much more replicable than the blockbuster/megahit model.
The challenge is that making this model replicable requires new ways of business. As Palmer and others have said, this model works best if you are an extrovert. If you are comfortable asking for money, asking for crash space on tour, asking for a loaner piano to practice on, asking for a stage prop to be delivered, then you can move faster and get more done - at the 'cost' of intensive fan service. Not every author or artist is comfortable doing that, but that's OK. It's not a flaw in the model, it's a business opportunity.
Filling this need means we'll see the emergence of a new class of intermediaries. Just as many successful authors today have "web goblins" (as I think Neil Gaiman calls his Webmistress) or other staff who maintain their online presences, other artists are going to need social media intermediaries to handle that fan service. This is no different from the need authors have for traditional literary agents or performers have for tour managers. Performing is a business; people in business hire out the parts they can't handle themselves. Some of those hired people are called things like 'accountant' and some are going to be called 'twitter wrangler'. Shy performers (writers, artists) will have more need of these people than extroverts but that's not a fatal blow. Sometimes shy performers will have to get by doing things they're not good at because they can't afford to hire people, just like musicians starting out today often have to book their own shows.
Or maybe these artists will learn to ask, and somewhere within their few thousand fans will be someone who knows a club owner and can book a gig. That fan may even do it for free because, after all, there is something to be said for prestige.
(I am indebted for many of the ideas in this post to a fine group of savvy friends, many of them writers in their own regard. In no particular order thanks to JC Chatelain, Fred Barrett, David Weinberger, John Sundman, and Joe Mahoney. You should buy their books.)
Thanks to my friends at Owner's Rights Initiative I just got word that the Supreme Court decision in Kirtsaeng v Wiley has been issued, and the decision has gone 6-3 to Kirtsaeng, reversing the Second Circuit.
Publisher's Weekly confirms - as of this writing there hasn't been a statement yet from Wiley, nor have I had time to read the decision and dissents or concurrences. I'm sure there'll be more to say later. But for now all libraries, individual sellers, used bookstores, and the rest of us can breathe a sigh of relief.
ETA: decision is here. I'm still reading it, but the first thing that strikes me is it's a fairly odd alliance of Justices. How often will we see Kagan and Alito filing a (concurring in this case) opinion together?
Natco's manufacturing is protected under an Indian national compulsory licensing scheme that follows the guidelines set out under TRIPS, a WTO-governed international trade agreement. Bayer has said that it will continue to fight against Natco and other country-local producers who are targeting lower-income buyers and in the process disrupting big-pharma international monopolies.
As I've made clear in the past, my sympathies in these cases are divided. Development and testing of drugs is a socially valuable but intensely expensive undertaking. Until and unless governments are willing to shoulder the entire burden of this process we must rely on commercial companies to do it. These companies need to be compensated for their costs of research and development and they need to make profits to stay in business. It's not enough just to make money on some drugs - if companies only have incentives to produce certain kinds of drugs then treatments for important conditions will lag. The sad state of anti-malaria treatments versus, say, expensive first-world mental health medications demonstrates this clearly.
However, the reason these medicines are so socially valuable is that they are often life-saving. They may be the only thing standing between millions of people and significant suffering or even death. Companies that are granted special rights such as manufacturing monopolies (patents) need to be willing to give up something in exchange - likely that means giving up some of their possible profits in order to ensure that life-saving medicines are more affordable.
More elaborately the answer is "No. You don't get compensated for sales of used physical books; why do you think e-books ought to be different?" Well, for one thing a used electronic item doesn't degrade in the way that a physical item does. There's something nice about buying a pristine copy of a book and every used-book marketplace I know of requires sellers to state the condition of the book because a sufficiently degraded physical book can be unpleasant or impossible to use.
In theory, if there are pristine copies of e-books out there it will destroy the marketplace for new copies. Except there are already vast stocks of pristine physical books around. Ever heard of overstock? Or check those condition listing for physical books. I bet you can find descriptors like "unopened" or "still in shrink-wrap" or "pristine" or "like new". It's true that not every copy is like that, but it's simply false to assume that every used book is lower quality.
Scalzi and Waldman wail on at length about how authors need to get paid, a philosophical foundation I share. But the used book was sold, and the author did earn her or his money on that sale. That, as I said last time, is the entire point of first-sale doctrine. If authors or publishers feel that used sales are taking some amount away from first sales then the proper response is to increase the price on first sales to compensate. Teeth-gnashing and trying to shut down entire commercial marketplaces is a sorely misplaced sentiment.
And speaking of misplaced, I think Scalzi and Waldman would do well to watch Amanda Palmer's discussion of the art of asking. Rather than spending their time and energy trying to figure out how to force people to pay, authors need to learn how to connect with people and in so doing encourage them to help the authors.
(Sorry for the week-long hiatus. An unexpected change in job situation sort of threw me off track.)
Salmon comes in for a mention in the talk, but his reason for posting it is because he wants to talk about the same things that Palmer talked about: how do you convince (not force!) people to pay for what you can offer? This is the flip side of his first column about how to package your product so that it diffuses out to the appropriate audiences. The payment side requires that people - as Palmer describes - overcome a certain shame in asking, and develop a level of trust in themselves, in their audiences (fans, readers) and in the relationships that can be built. Salmon points out that the publishing business has been frankly awful at this, though he shares Palmer's sense that Twitter may create a fundamental change there.
Salmon talks at length about the various models most in use today and argues that there are no sharp necessary distinctions between such things as paywalls and tip jars. In particular, as an economist or a businessperson you might want to try to compute the relative merits or likely payoffs of different models but that's likely an impossible task. What you need to do (like every business) is try to match up your supply and demand curves and make them meet at a point you can live with.
How long you live with it, though, is another problem entirely. Salmon points out that high (or pricey) paywalls may generate more short-term revenue and look better to the current bottom line, which is great if you're trying to pump up your stock price or make yourself look like an attractive buyout target. But they may be killing you long-term as your current readers die off or move on and your paywall not only shields you from those who want to rip off your content, it also makes you invisible to new people who are searching.
This matters because you're probably not talking about reaching audiences of millions or even hundreds of thousands. Palmer's fan base is probably in the tens of thousands and that's probably about the right size, for her. Salmon notes that the Internet "...enabled smallish numbers of people to pay modest amounts of money..." and that can add up to a sustainable model. This is, I think, the answer to the question I started gnawing on in January: how many people can be counted on to sustain a writer?
The answer is "probably not a lot, but that's OK" because if a few tens of thousands of people can be enough then there's a lot more subscriber base to go around. I'm trying my own little personal experiment in this area, seeing how many Kickstarters I feel comfortable backing. Right now I think my appetite is something like 1 or 2 a month at probably $20 or $25 each. We'll see how it goes.
Well it turns out that both Congress and the EFF have decided to take up the issue. CNET's Declan McCullagh provides a brief history and overview. (I have to wonder if he'll be allowed to continue reporting on this once CBS figures out that DMCA exemptions and changes to the law are not in their corporate interest. But I digress...)
Congress, in the personage of Senator Ron Wyden (D - Oregon), introduced a bill intended to fix some of the DMCA's problems. At the same time the EFF, startup incubator Y Combinator, the Mozilla foundation, and Reddit got together to launch FixTheDMCA.org, which is specifically focusing on repealing section 1201 of the bill - that being the anti-circumvention provisions.
As McCullagh points out, past attempts to modify 1201 have raised the full ire of the Cartel, which may be why Wyden's proposal is much more modest. Modest or not, I suspect we're going to see a lot of FUD raised around Wyden's bill.
It seems that most of the parties in this case also don't like that answer, and for good and sensible reasons. I was particularly taken by Bowman's lawyer's argument that a finding for Monsanto would elevate patent rights over personal property rights. This is a powerful point and highlights some of the great contradictions we've built up in our current maximalist system. I wonder how my libertarian friends see this, as many of them are highly respectful of property rights, but also feel that government should not interfere in business market practices. Does the trump card of personal property rights in this case mean that Monsanto's business model must fall?
And if it does fall, what does that mean for the patent system in general? I can see no rational basis to distinguish a biological machine from a physical one and grant patent protection only to produces of the latter, just because of the composition of the machine. Our notion of what makes a "natural" object in the world versus an engineered object may also have to change as we learn more about "horizontal" DNA transfer (see here in Biology Online and here in a story about how blood-sucking insects may be part of a process of horizontal transfer in humans). So it's not a good solution to say "well, just don't allow patenting of biological machines".
It also seems clear from the summary that SCOTUS understands that the patent system's "exhaustion doctrine" isn't sufficient here, either. I suspect we're going to see this question come up again, soon, as we're not far from a world in which 3D printers can print out all their own parts, after which assembling the parts into another 3D printer that can self-replicate won't be far behind.
Unfortunately, the administration can't single-handedly order this done. As the response points out the decision still lies with the Librarian of Congress, though other agencies such as the FCC are sure to get involved. FCC Chairman Julius Genachowski has also chimed in his agreement with the administration on this issue.
So, what does the Librarian have to say? Um, nothing. To be fair, the brief response acknowledges that the White House has weighed in. Not that they're going to do anything about it, but at least they acknowledged.
It will be interesting to see who moves next in this little Mexican stand-off. As of now the rule is still in place - if you bought a new phone after January of this year you can't legally jailbreak it.
Pretty much ever since she put her Kickstarter in motion a bit under a year ago one lingering question has been whether this sort of thing is unique to Palmer, or whether there's something reproducible in this experience. Although it's not framed as such, what I hear Palmer saying in her talk is "Here is how I did this and here's what you can try, too."
It's not about the details (which is good and right for a TED talk) - it's about the philosophy. Although the talk is titled "The art of asking" and Palmer talks extensively about her experiences asking, the secret sauce for me is in her discussion of trust. You could equally well title the talk "The art of trusting" as she talks about the degrees and kinds of trust she has in her fans and how that affects what she does with her music.
In particular, she says she never tried to "make" people pay for the music; she asked people to pay and as she says,
When you connect with them, people want to help you
Connecting isn't easy, particularly if one is not a naturally outgoing or gregarious person. Neither is trusting. But both are skills that can be practiced and if anyone is going to replicate the AFP model, they're going to do it using huge elements of connection and trust.
I'm trying to remember how long ago it was that Cory Doctorow wrote, "Giving my stuff away is selling the hell out of it" or words to that effect. (Actually, I don't have to remember because the Internet remembers it for me.) The notion that giving people something for free would entice them to pay more is as old as coinage, I believe.
For a long time the notion of giving your stuff away was buried from mainstream sight. Buried first under the glare of celebrity/blockbuster/mega-hit productions in which corporations made stars of people and shows and books and things for which people paid ever-increasing prices. Then it got re-buried under an avalanche of FUD about piracy and sharing.
But of late the notion of free is making an important comeback. In gaming, there's an entire genre of "free to play games" in which you get the game for free and pay for things you want related to the game: cosmetic items, power-ups, unlocks of special features, more capabilities, etc. Authors and musicians and other creators have recognized the power of giving their things away to connect with audiences, build loyal fan bases, and maybe put up a tip jar so people can pay if they think it's worthwhile.
This week, under the title "How to get people excited about education", Felix Salmon posted about what I would call the economics of some of these freedom-driven models. In particular, he talks about the spectrum of education experience that ranges from massive open online courses (MOOCs) to individualized, in-class direct education. His argument is these are complementary, not competitive products. Giving away your lectures via YouTube isn't going to cut into your enrollment, he argues. It's going to build your brand and name and value and while it filters out those who don't have the drive or money or time to sit through intense graduate-level education courses, it's also going to select for the people who do have those things, and bring them to you.
He points out that the same model of increasing yields as you increase costs can be made to work in other areas - his second example is about the Metropolitan Opera and he concludes that,
...the more you give such things away, the more demand there is for the very expensive live product
Yes, exactly. Salmon calls these different offerings "diffusion lines" as in different ways you get ideas and content out to people. And he argues that this kind of thinking can be the basis for what I would see as a broadly economically sustainable set of marketing and business models.
ETA: I am editing this article to correct errors of fact. As always, any mistakes here are my own fault.
In a word, they're socializing the cost. The price PeerJ charges you is, in effect, a fee to submit. There's no guarantee that your article will be published, only that by paying the $99 fee you'll get it reviewed.
ETA: Peter Binfield, the publisher of PeerJ and Jayson Hoyt, the CEO, have written comments you can read below kindly letting me know that I've misunderstood the model. There is indeed a $99 up-front option, but it's not required. If you choose not to pay that and do get published you pay a $129 cost.
This compares with a PLOS publication like PLOS1 that might not take your article for review but if it does so it pays the cost at that time for you and only on publication do you pay your $1350.
Well, a little math will show you that if they publish 1 out of every 14 submitted articles then PeerJ has a better revenue model. The publication rate for submitted articles at most high-quality journals is probably less than that. Many journals don't publicize these rates (presumably to avoid discouraging potential authors) but a rate of 1 in 20 or 1 in 25 would not surprise me. In fact, one of the things that makes certain journals so prestigious is that they are hard to get into. Often an author will find that a very good paper isn't published not because of anything to do with the paper but just because the journal only has resources (pages, editors, reviewers) to handle a fixed number of submissions. A common academic strategy is to submit a potential publication first to the best-possible venue for it and if it's not accepted there then turn around and re-submit it to other places.
ETA: Binfield wrote in his comment that they "...expect to end up accepting ~70% of all submissions". That's a fantastically high rate and assumes a level of quality in submitted papers that was not present when I was doing academic peer reviewing. It will be interesting to see what the numbers end up being.
The review-reject-resubmit cycle can lead to long delays for publication, which in turn relates to another pointer art sent: a notice in Nature's blog about the White House's incremental move toward open access. The new policy is that "taxpayer-funded research should be made free to read after a year’s delay" which seems like a lot on the face of it but is still shorter than the often multi-year delays involved with pay-subscription journals.
Once upon a time Dave Barry wrote a great column about how corporations in general used the phrase "for your convenience" to mean "we're doing whatever the hell we please but we want you not to hate us for it." Companies make changes that people hate but slap the "for your convenience" label on it on the theory that people are stupid and easily duped. His edge case example was something like a supermarket announcing "For your convenience we've filled the parking lot with rabid weasels. Have a nice day."
Where David Kravets wrote "online copyright scofflaws" you should read "anyone who happens to have the misfortune to be assigned responsibility for an IP address that the Cartel thinks is doing something wrong." Because, remember, that's what we're about here - taking IP addresses and smacking people for things we claim were done at those addresses. The Cartel can't even be bothered to remember its own history, which involves claiming that mysterious "Someone Else" used RIAA-owned IP addresses to pirate content.
Where David Kravets wrote "backed by the President Barack Obama administration" you should read "pushed by the Cartel flunkies who have entirely captured the DOJ and the US Copyright office in the last four years." I doubt Obama gives a rat's ass about this stuff, but you can bet that the people at DOJ who are eyeing juicy jobs at major studios and labels after their tenures in Washington are done.
Where David Kravets wrote "To be sure, the deal is not as draconian as it could have been" you should read "Somehow the ISPs managed not to cave entirely to the Cartel's demand that people associated with IP addresses it doesn't like be tarred, feathered, and dragged through the public square, as if piling on ever-more-draconian measures would somehow eradicate hundreds of years of people sharing creatively."
OK, I give up. I can't even maintain a sufficient level of outrage to make this entry funny. It's pathetic, it's sad, and it's hopeless. No one elected the Cartel to enforce laws and I certainly didn't pay my ISP hundreds of dollars/year to filter my content. I eagerly await the inevitable day when DOJ is forced to degrade its own network because, hey, people are using DOJ IP addresses to torrent movies, too.
If you read my lengthy yard-sale post earlier this month, I discussed how the new consoles coming out - Microsoft are apparently debuting theirs at E3 - have been rumored to have functionality that would hamper the playing of used games. Sony, despite having been granted a recent patent in this area, appear not to be doing that. The money quote is: "[gamers] purchase physical form, they want to use it everywhere, right? So that's my expectation."
Instead, what appears to be happening is a more gentle approach, whereby Sony are planning to roll out a variety of services such as streaming, cloud-based game libraries, and so on. These services should get people used to the idea that a console game isn't just a cartridge and if the services are priced to be competitive with existing game stores such as Steam, the gamer will get used to frequent sales and when they want cheap games they'll buy from these services.
I think this is good news for gamers, good news for first-sale rights, and good for the marketplace. Now to see what Microsoft's answer is.
Why TV Ad Revenue Goes Up and Internet Ad Revenue Goes Down
This is pretty far off the nominal Copyfight beat but I could not resist pointing to Felix Salmon's column on "Content economics." It's a very good look at why Net advertising is not the same as/does not replace TV advertising and why broadcast TV can keep raising its prices even as its viewership shrinks. Hint: it's all about the fragmentation.
Flaherty's issue appears to be that there are patents covering aspects of 3D printing and therefore companies are not inventing things de novo without constraint. This is hardly a shock - every business of the last couple centuries has been born into a world where patents existed and some of those patents were even relevant to the new field of business. Indeed, the point of a patent is that you've introduced some innovation or improvement, often by improving upon existing related processes. Much of homebrew 3D printing is innovating and improving on the areas of 2D printing and process manufacturing that have existed for decades. To find that there are relevant patents is far less surprising than it would be if there were no patents.
Furthermore, although the last few years have seen a surge of companies, models, and innovations in 3D printing, the ideas and technologies go back quite a ways. Again, older technologies are often covered by patents, upon which new inventors improve. The specific 10 patents that Flaherty highlights seem pretty normal to me, despite how much he wants to hype things up for this story.
What do you do in such an environment? Well, you do what businesses have always done - you deal with the existing intellectual property. You can license it, innovate around it, show that your machine or process doesn't infringe the specific claims of the patent, file a patent on your improvement that cites the existing patent as recognized prior art, and so on. Bringing 3D printing to every home that wants one is a laudable goal but it's no more likely to be "stymied" by patenting than any other home-use machine, though Flaherty seems fond of hyperbolic descriptives like "fortresses of patents".
In fact, Flaherty seems to hyperventilate over companies doing exactly what I describe. He notes that patent #5,387,380 is held by MIT, which licensed it to a company that... hold your breath, it's scary! ... innovated on it and filed its own patents on its innovations. By the way, MIT doesn't sign exclusive licensing agreements - anyone else who wants to go license that patent from MIT and innovate on it is free to do so. He also seems unhappy that the current crop of 3D-printing companies like 3D Systems and Makerbot are themselves applying for patents.
This is just silly FUD. Patents in 3D printing aren't special - they have all the same strengths and weaknesses as patenting in other industries. It's just that home 3D printing is hot right now and sexy and ... well, that sells more ad space.
As I and others noted back then academic publishing is a gigantic scam in which free labor (peer reviewing) is used to filter works submitted for free by people (researchers) who got other people (usually taxpayers, corporations or endowments) to pay for the research in the first place. All this free and paid-for-by-others stuff is then turned into extremely expensive dead trees by publishers like Elsevier who charge so much that even very rich institutions like Harvard are saying "enough" and refusing to pay more.
Around that time, Tim O'Reilly put his money behind people who included Peter Binfield, the managing editor of PLOS ONE with the goal of changing the game entirely. The result, known as PeerJ, has been hard at work and this week published its first articles, with a pricing model that - to use a much-abused term these days - is majorly disruptive.
PeerJ promises to combine revolutionary low pricing levels (like, USD 99) with high-speed turn-around, addressing two of the worst problems in academic publishing. PLOS ONE has a great pricing model compared to traditional publishers, but PeerJ blows even PLOS ONE out of the water on pricing. Taylor also reports that PeerJ's user experience is first-class, something that ought to attract academics who are still leery of working with non-traditional publishers.
And yet... and yet, I cannot help re-asking the question that I think forms the heart of this problem: what about tenure? Is there any evidence that, five years on, non-traditional journal publications have the weight and impact that traditional journals do? Because Taylor's subhead is about "the moving-prestige-to-open-access dept" and last time I looked open access wasn't granting tenure, and when you submit a grant proposal to DARPA or NIH or your favorite funding source, they still require you to submit a publications list and they still care where you publish.
Yes, PeerJ is bringing revolutionary and much-needed pricing change. But until someone can show me the professors who got tenured publishing in PeerJ or PLOS ONE, there's still going to be a long distance between publication and prestige.
While we wait for a decision on Kirtsaeng a couple of interesting news items have crossed my radar and I wanted to write about them together, as they both relate to the marketplace for used electronic goods, and the non-trivial relationship of those goods to piracy. This is a bit of a long walk but I promise it all ties together.
The first item is the reporting around Amazon's recent patent announcement. This isn't an actual service that Amazon is providing, or has even stated that it's going to provide. Instead, it's a patent they were awarded at the end of January that purports to cover a marketplace for digital objects. Putting this out to the news wires is clearly them floating a trial balloon.
The patent (#8,364,595) involves creation of a "personal data store" for the digital objects. While you own the object you get to download or stream it up to a certain number of times controlled by DRM or policy. Since there's already a mechanism in place to limit your access, it's pretty easy to say "OK, I'm done with this object and no longer want it." At that point, your remaining number of accesses gets set to zero, and you can dispose of the object by selling it to Amazon (or whoever licenses the patent) for some amount. The used-object vendor can then either apply some more DRM/policy to give the next owner some more downloads or streams, or just keep the original counter going. Presumably when you buy a used digital object there would have to be some disclosure that your use of it was limited.
His objection is that Amazon would be making money off the used e-book, but he wouldn't. I find this baffling. To my knowledge, Scalzi doesn't object to used bookstores for physical books. I suspect he's also purchased a used CD or LP in his day, as well. As far as I know, in those cases no additional money is flowing to the original author. This, after all, is the whole point of first-sale doctrine, which is at the heart of the Kirtsaeng case. I confess I can't see any significant difference between the e-book and physical book situations. In fact, it's quite possible to buy used physical books right now through Amazon. It just so happens that Amazon has things set up so it's a front for third-party sellers, but it gets money on every sale and in principle nothing stops them being originating sellers. So what's the big deal here?
Other people have a different attitude toward used digital goods, and piracy. Take, for example, games. Right now we're at an odd place in the console gaming industry in that all the popular consoles are using old-generation hardware. New machines are on the way: Microsoft and Sony have both shown previews and talked about their upcoming devices. Both look fairly similar from a hardware perspective, but there's a potentially huge split coming in how the next generation of consoles treats used games.
For a while now there have been rumors to the effect that the next Xbox will try to block users from loading used games whereas the Sony console will allow it, or vice versa. Naturally, this is upsetting to places like GameStop that make a great deal of money from reselling used games. In a speech to the Goldman Sachs Technology and Internet Conference, GameStop's CFO Rob Lloyd showed his company's research that indicated a solid majority of consumers were opposed to having used games blocked and wouldn't want to buy a console which did that. His research also claims that most used games are older titles, with the clear implication that the used market isn't cutting into new-game sales, since the volume of game releases often means that all but the biggest-selling titles are cleared from store shelves within 60 days.
In fact, the makers have taken the unusual step of talking directly to people who have illegal copies of the game, asking for feedback, mentions in tweets, and upvotes on Steam's Greenlight, which is kind of Survivor for indie games. If this works out, then some people who pirated the game will like it and buy a copy. Some people will talk about it on Twitter and elsewhere, which is free publicity. And some will upvote it, which means more people see it on Steam and buy it because it's cheap there.
And that brings me back around to the console/used games issue. Steam, like Amazon and unlike GameStop or Walmart, doesn't have shelves to empty. Games stay there virtually forever. So long as the maker still exists to provide more license keys, Steam can sell additional copies. Steam has established itself as a place where older games are available at steep discounts. This begs the question of why would you buy a used game when you can expect to get it new from Steam (or Green Man Gaming or similar site)? It's entirely possible that the ubiquity - the effectively infinite shelf-life - of downloadable games will do more to kill the used-game market than anything Sony or Microsoft do.
And that, at last, brings me back around to the "I hate reselling" attitude that John Scalzi expressed above. Because here's the thing: if you can make a game for a console that blocks used games or you can make a game for a console that allows used games, from which you don't profit, which would you do? Well, if you think you'd lose sales to used games then you might want to go with the locked-down platform, just as Scalzi would have you go to piracy before resale. Except you may lose more original game sales because people might not buy that locked-down platform in the first place, as GameStop is arguing.
But if you believe that your game will always be available (e.g. through Steam) to people who want it then you can afford to wait for the less-popular console to gain market share. And of course there's a knock-on effect in that if people see more good games being released only for the locked-down platform they may just swallow hard and buy that platform anyway.
The big deal, then, is that it's not as simple as "Amazon reselling used stuff = bad". It's that we're witnessing a rapid evolution of marketplaces and business models with lots of players jockeying for position, all of which makes me hope even more fervently that SCOTUS doesn't "drop the banhammer" as we gamer geeks say.
Salmon notes that the tip jar and accompanying text give the impression that the blogger needs the tip revenue to support her hard work. However, a slightly deeper look reveals that not only does she have another "day job" that provides income, she heavily uses affiliate links both on her blog and on social media like Twitter. Her actual income from these links isn't known, of course, but given her popularity and standard conversion rates it's possible to generate estimates. Given that these estimates appear relatively large, it's a fair question to ask whether the tip jar on her blog is actually necessary, in the sense of "I will not have money if you don't leave a tip here."
That's a very different situation from the musicians of NoiseTrade, or even Amanda Palmer's famous Kickstarter. In those cases it's clear that the funding provided by the sponsoring individuals is all there is. It's a level of transparency that may be necessary for this kind of model to work. Palmer's problems with her Kickstarter included complaints about its size - to which she provided a breakdown of how the funds were to be used. It's natural for people to think "hey, you have $VERYLARGEAMOUNT, why do you need it?" and it may be incumbent on those who are asking for public donations to include a publicity/transparency plan in their campaigns.
This is more or less the core question posed by music download site NoiseTrade. The site provides hosting and tools for music creators who are willing to give their stuff away, along with a fan-settable slider. This slider, labeled "Tip", gives the downloader the option of paying 1-25 dollars for what's on offer. There are also usually free listening samples so you know what you're getting before downloading.
This is similar to the set-up that many independent artists have on their own Web sites, and the tradition of setting out a tip jar on the piano, or an open guitar case with a few symbolic bills or coins in it is as old as anyone can remember. (I'd be curious to know if this tradition is world-wide. I've seen it in North America and Europe, but not elsewhere.)
In addition to hooking into this old traditional social practice, NoiseTrade provides artists with tools to build "meaningful connections" to their fans. NoiseTrade allows artists to create "widgets" that can be embedded on personal sites and in a variety of social media (Facebook and MySpace are still popular with many artists). NoiseTrade handles the downloading bandwidth and associated technology lifting in exchange for its services. Artists need to have a PayPal account, which NoiseTrade uses as the transfer destination for tipped funds. This means that artists end up collecting less up front due to the service fees but as with any service it means they have more time to focus on their work.
The question, as yet unanswered, is whether this sort of service to facilitate a more intimate connection is worth it. Clearly artists are taking risks - NoiseTrade music is DRM-free and nobody is required to tip for what the artists choose to put up. On the plus side, artists need fans, and need to get noticed. The site promotes artists (via targeted mailings, Facebook, blog posts, and featured sessions) and as with so many creative endeavors it's clear that the biggest problem facing most performing musicians today is getting noticed.
I've signed up for NoiseTrade's email newsletter and we'll see how it works out.
It's possible, then, that Apple or Amazon won't come to dominate the ebook-to-reader "last mile" the way many of us had feared. But that mostly depends on relying on the good graces and forgiveness of these companies, which I'm not inclined to rely on that any more than I'm inclined to rely on DOJ's prosecutorial discretion. I would say that Macmillan's capitulation brings us to the end of Chapter 1 in the mass-market e-book story, but there are going to be more chapters written, and probably soon.
Dear Gamers Workshop, Welcome To Social Media Hell
As I mentioned yesterday, GW has acquired a whole new set of un-friends. Today they hit the bigtime, with a front-page linked article on io9, a very popular site for SF/F/gaming/movie genre fans. Apparently they're also getting thrashed on Twitter. Dear GW, back down now. Apologize. You need to stem this tide. Every minute you let this go on your name becomes more mud. If this goes on for a week it'll take you a year to wash the stink off. The entire Northeastern US is sitting at home under a blizzard and has nothing to do all weekend except talk about how shitty you have been to one of our friends.
This is all over my blogroll today: Games Workshop is coming down absurdly, wrongly, overreachingly hard on a small author over its fantasy of having a trademark on the phrase "Space Marines" that prevents others from using that phrase.
The most direct victim at this time is author M.C.A. Hogarth. Hogarth reports on a disheartening, but all-too-familiar, situation in which the big company pulls out the big lawyer guns and picks on the small (mostly self-published) individual who doesn't have the money to fight protracted legal struggles. One of the people who has responded is John Scalzi whose blog entry at "Whatever" points out that not only is this "weak sauce" on GW's part, the story may turn out very differently if they ever try to pull this crap on ",,,an actual publisher, with actual lawyers. That should be fun."
Doctorow's post (correctly, I think) also lays some of the blame on Amazon. They had no need to take down Hogarth's e-books. That was a craven corporate decision, and a disappointment. Say what you like about Google, but their efforts with their Transparency Report are setting a standard that other corporations including Amazon could do well to emulate.
So what happens next? Well, readers might want to let Games Workshop know how they feel about this. You can reach them by physical mail in the UK. at Games Workshop, Willow Road
Lenton, Nottingham, NG7 2WS - or if you're more digitally inclined I believe they read and comment pretty regularly on their Facebook page (https://www.facebook.com/gamesworkshopofficial)
Greenfield compares Netflix's numbers with some sample numbers from HBO (since Netflix says it wants to be "the HBO of Internet TV") and the results look surprisingly good even at that price-tag. Given their stated goal of having five shows at this size and price, Greenfield estimates that the shows would need to drive an additional 10% growth in subscriptions in order to break even, assuming that Netflix doesn't change its basic $8/mo subscription price and includes these series in that price. HBO's shows cost considerably more to produce and don't drive that much more revenue, making Netflix's P/L projections easier to hit.
If there's a problem in Netflix's future, it's probably not home-grown content but the content it has to get from other producers, which is getting increasingly expensive. As those costs have gone up, Netflix's margins (and possible profits) have gone down. Making its own exclusive content helps stabilize that drain and provides a differentiator - if you like these shows and can't get them anywhere else... well, there you go.
My personal opinion is that Netflix is going to have to raise subscription rates. I foresee them inching toward a $9.99 price over the next two years. If they break $10 though I'd be surprised. I also expect them to explore some pay-more extras like the bonus things you get on most DVDs. Interviews, backstage stuff, even possibly early access are all things they can price out and play with that won't hurt their main subscription base.
In this case, congratulations go to Ms. Karyn Temple-Claggett, who has left her illustrious work as destroyer of "pretty much any innovative technology that comes along" (to quote Techdirt) including LimeWire and XM radio and become the number 2 official at the US Copyright Office. Guess we won't have to worry about things like being allowed to jailbreak our smartphones after all.
An acquaintance who's trying to shift from "having a day job" to "making a real living as a musician" sent me a link to Cashmusic. This is a new non-profit organization that bills itself as building "open source tools for musicians". The artists still need to do a fair bit of heavy lifting, but as a non-profit they may be well positioned to help get funding streams for creative types flowing. They did a Kickstarter to get some funding and today they announced their open beta. I'm not a music-maker but if you are and have a chance to try them out please write in with your experiences.
NMA - in their typical style - make light of the silliness of the situation. Most of their videos are news parodies that poke fun, but their clip also points out that the online gambling industry provided over 4000 jobs, a significant figure for two poor and tiny nations, and that most of those jobs have been lost since US regulators cut off access.
According to the story in AdAge, the idea will be to have people subscribe to channels of content produced by people or studios with a proven ability to develop a following. In other words, bundles, which strikes me as a very bad plan, and sort of the opposite of taking advantage of YouTube's digital delivery capabilities.
My own experience with YouTube channels is that I subscribe to many but watch content selectively. For example, I am something of a Felicia Day fanboi and followed her The Guild series. Her channel also includes Wil Wheaton's Tabletop, which I liked and several other things like Sword and Laser that I never watch. If you said "Hey, pay a few bucks to watch The Guild" I'd pay. If I have to pay more bucks and get all those things I'm not watching for money I don't want to pay then I have to stop and think. Of course, it's possible they'll price it so cheaply that I won't care, but given that YouTube has the ability to atomize and organize content in nearly infinite ways, why push everything into a bundle?
Then there's the other question of how many bundles can I afford to buy? The more of them there are and the more expensive they become then the fewer I'm going to be able to purchase. Maybe, as I mentioned early this month, I'm in the minority here. Maybe people will just happily pay for this bundle and that bundle and the other bundle and not think anything of it. It just seems a shame that YouTube isn't doing something more creative, given that it is not tied into any legacy business plans yet.
(h/t Xeni Jardin at Boingboing for the original pointer
See for example this page by the developer of the app called "X-Plane", a flight simulator. So far there hasn't been a lot of reporting on this - the Wikipedia page on Uniloc is actually a good summary as of this writing. The basic issue is that if you want to make an Android-licensed app then there are certain procedures Google advises you to follow for verifying that the person running the app does indeed have a valid license for it. Uniloc claims that the procedure is covered by its patents and has spammed out a bunch of lawsuits, including against popular games such as Bejeweled and Minecraft.
As in the Soverain shopping cart situation, there are companies that have decided it's cheaper to license the patent than fight. The patent (6,857,067) itself is a fairly old item and I can't remember what the state of the art was back in when it was filed. However, the patent cites no non-patent prior art, which is a big red flag since it means that almost any trade, industry, professional or academic publication might be fair game for invalidating the patent. At least two of the smaller players who are being sued have vowed to fight back, so perhaps someone will take this one down, too.
The story starts with online gambling, which the island nations of Antigua and Barbuda (among others) have and want gamers to play. The US has a Puritan streak about a mile wide and has blocked its citizens from accessing these offshore casinos. The small nations then went to the WTO, complained of restraint of trade, and won. WTO cases normally come with a judgement intended to even the economic scales. For example, if China loses a WTO case to the US then the US may be allowed to slap an import tariff on something from China. Or vice versa.
Well, Antigua and Barbuda don't have a lot in the way of import/export business in durable goods, but they do have a nice fat Internet pipe and fancy servers. Since the WTO has allowed the small-state winners here to get USD 21 million per year, the two countries have floated the idea of setting up some kind of "copyright haven" to get their money's worth.
Nobody quite knows what this might look like - the story reports ideas of cheap subscription services that provide copyrighted content, but Antigua and Barbuda haven't stated anything official. The theory goes that by providing (expensive) copyrighted content cheaply and remunerating smaller payments back to the rights holders, the islands would in effect be collecting their WTO-sanctioned "impairments" while the US continues to (illegally) embargo the islands' lucrative online casinos. Of course the Cartel and its sock puppets in the administration are screaming bloody murder but Antigua and Barbuda just keep calmly pointing out that they did win their case at the WTO and they are only acting to collect what's due to them.
An eye for an eye, anyone? I can't wait to see this made into a Verbinsky/Depp blockbuster.
This debacle was nicely covered by Derek Khanna in The Atlantic yesterday. Khanna points out that we never actually passed a law that said it should be illegal to do this. Rather, the DMCA - a law passed before smartphones even existed - criminalizes all kinds of activity like this. It's possible for the Librarian of Congress to create exemptions to the law but it's certainly not required, and it didn't happen in this case because the Librarian decided to let an exemption lapse.
My guess is that it'll be reinstated, because this sort of thing is ludicrous and it's going to generate a lot of negative publicity. However, I think Khanna is also spot-on when he points out that we ought never to be in the position of having to depend on prosecutorial discretion not to come down as hard as the letter of the law allows (resquiat in pacem Mr Swartz).
Well, maybe not, argues Skip Sauer in The Sports Economist. In particular, he notes that sports programming is a (the?) major driver of live television. Really, there's nothing else going out live that people care about in any significant numbers. This is true across broadcast, cable, and satellite. The problem is that the cost of sports programming is going up. Blame players or owners (or both) as you please but as salaries go up, so too do ticket prices and the costs to sports broadcasters.
If sports costs a lot more than everything else, then, the question is who is subsidizing what. If the (high) price of sports broadcasting is bundled in with the (lower) price of other broadcasting then it's not inherently clear whether the very large audiences for the sports content are paying more money than they otherwise might, and thus subsidizing the non-sports channels or whether those who don't care about sports but buy the cable bundles with sports in them are subsidizing the sports.
If you were to break the package apart, two things might happen. One is that the lower viewership for non-sports content might render the content uneconomical to produce. Two is that the high price of sports content might be considered too high and people would not want to pay that much for less content, causing a drop-off in viewership. Neither of these is in the interests of the content producers, so regardless of which scenario you think is likely it's easy to see why the content producers as well as the content providers would be in favor of bundling.
Sauer also points to a 2006 publication by GMU professor Thomas Hazlett (direct PDF link here) that argues consumer choice is respected in bundle/tier pricing and that a significant segment of consumers will opt for bundles when given the choice. The paper is lengthy (40 pages) and makes some assumptions I would contest. Also, I think the consumer climate has changed in the past 5-6 years with the rise of high-speed networking and mobile devices so its conclusions ought to be re-checked. However, it's still a solid piece of research and ought to give pause to a reflexive assumption that a la carte is always going to be better.
My guess is that we're going to continue to see a bifurcated world. Smaller-scale, less attractive content will continue to do well by pricing itself directly to its audience (see for example Pledgemusic) or using sponsorship-type models. Bigger and mass-market content, though, may continue to thrive in tiered/bundled pricing models, which will struggle to find their place and connect with their audiences in the 'Net world.
A meme circulating in the free-culture lists I read is suggesting that the latest round of punitive measures taken by Verizon and other ISPs (sometimes called 'six strikes' - more info here on Boingboing and reference to Torrentfreak) is actually aimed at choking off free wifi.
Given A and B above, it's striking to note that Verizon has confirmed its plan to apply "six strikes" to businesses, not just individuals. So if six random customers sitting in a Starbucks are accused of downloading a copyrighted item, suddenly the Starbucks wifi may stop working, or may stop working so well? That would be ... um, terribly unfortunate so very sorry but we have this POLICY you see. And, again according to the theory, if businesses can no longer provide free wifi, presumably people will pay (more) to the big ISPs to get things like personal roving data plans, individual dongles, and so on.
I know a few smaller-scoped writers who have quit CNET or decided not to go there since this bomb first dropped, but Sandoval has major juice. He's been a well-respect, often-printed, and very public byline at CNET for years, often writing about intellectual property issues. Ironically, his resignation came over an IP-related story.
In case you missed it, there was a big Consumer Electronics show recently. As they do, lots of news outlets went there, reported a ton, and sifted among the offerings to come up with their top N things. It's a traditional way to write a show-wrapup story. Most people don't pay attention to such things. You could throw a virtual dart at Google News or any other aggregator on show closing day and hit one "Top N of $show" headline at least.
But someone at CNET's parent company, CBS, didn't like what they saw in CNET's list. CNET had already reviewed the Dish Hopper DVR in pretty positive terms - a device that allows users to skip commercials while watching DVR-captured content on a variety of home computing devices. CNET was reportedly going to make Hopper+Sling it's Best in Show until the bosses upstairs said "THOU SHALT NOT!"
To compound this idiocy, it appears that CBS actually stuck its political nose into the CNET newsroom and forbade CNET from any further reviews of Dish products, let alone giving them awards. So much for journalistic honesty and independence. And really you can now kiss any chance you had of CNET's review sinking into obscurity. It's been linked to a thousand times more since CBS's move than before, I'm sure.
The effect on CNET's staff has to be utterly demoralizing. Say what you like about some journalists, but I think you'll find the vast majority are honest folk trying to do good work and they are among the strongest believers in independent voices and at least the honest attempt at unbiased reporting. I can't imagine why any journalist who's looking for work right now would be looking at CNET, though I can understand why those who have to take home a regular paycheck to keep food on the table might stay there. I imagine Sandoval has bills to pay, too, and I hope he finds a better place from which to do that.
I'll be offline for Arisia from tomorrow through Monday. Don't burn down the house while I'm gone. There won't be any IP panels at the convention this year; their popularity has always been low. I'll be busy nonetheless.
If you're there and see me please stop me and say hi. If I don't already know you please let me know you read the blog; I like to meet readers. If not, I'll be back to writing here next week.
Yesterday, in a posted preview of his talk for O'Reilly's TOC conference, Cory Doctorow looks at the question of why writers get so little. The answers, as you might expect from Cory, revolve around markets, business structures, piracy, and the complex web of incentives that are created by laws and traditions. It's not entirely accurate to say authors get paid poorly because they've always been paid poorly but it's also not entirely wrong - there has likely always been more material looking to get published than there have been spaces for publications by professional imprints.
In an era of (potentially) oversupply, the problem faced by the 99% of writers is breaking through. Getting noticed. Everyone knows about JK Rowling or Stephen King or Neil Gaiman now, but we don't know about the next Rowling, King, or Gaiman. Somewhere out there today are writers whose work could be as popular and game-changing, but that writer can't get noticed, can't get their first novel published, can't get out of the mid-racks, can't whatever it is that breaks a writer through to prominence. Or to the point where they reach their ideal audience, even if that audience isn't mega-millions best-seller sized.
Except now there sort of is. It's called the Internet, and self-publishing, and social media. It's a model whereby creative types can go through multiple channels to reach potential readers, build their audience, and start to make some money. In this model, two things are true that aren't true in other models. First, illegal copying doesn't hurt, it helps, and second regulation that tightens controls on the Internet and its freeform communities are harmful.
It's certainly their motto. A musician acquaintance pointed me to this site, which is attempting to be musicians' platform of choice for promotion and production of sponsored content. The site has many similarities to Kickstarter and other crowdfunding efforts, but appears to be focused on a specific narrow slice of the business model: getting music and related content produced.
The site works with artists to construct projects around a specific deliverable such as an EP, an album, or a concert film. Backers can sign up at various levels, and there are rewards associated with pledge levels. Unlike Kickstarter projects don't appear to have "stretch" goals. Basically you (the fan) are pre-buying a deliverable you want, whether it's a digital download, a signed personalized vinyl, or whatever. If the project gets its funding then then your credit card is charged and the pre-purchased items are produced and delivered. The site also supports artists' pre-order campaigns where the material to be produced is already known and fans can just order the things they want, for delivery when done. This is similar to pre-order sales done by other content producers including books and games.
Also unlike Kickstarter, PledgeMusic has a way for artists to designate a percentage of funds raised to charities they select, and fans are encouraged to search the site by charity name as well. The linkage of performing artists and notable charities is venerable - I signed up for my first Amnesty International membership at a table outside an REM show *mumble*quitealotreally*mumble* years ago - but this is the first site I've seen that lets artists select and promote their charitable work. It's not just big-name charities either; scanning the site I also saw artists giving money to local things like a battered-women's shelter in their home cities.
The site's focus on musical artists is interesting. One of the things they offer is a team with expertise in these kinds of projects - it feels like more hand-holding for the musicians than you get with something like Kickstarter. There's also a music-oriented philosophy about the site, with discussion of "backstage" access for fans, and a philosophy that appears to come from founder Benji Rogers' own experience as an independent musician.
The first PBS Off Book episode of 2013 takes on this notion full force. Called "The Art of Creative Coding" it examines at high speed a few of the prominent points in a phenomenon that is part commercial enterprise, part open-source development, part art movement, part inspirational mass volunteerism. The notion that ties these together is that openness, sharing, and exchange are not accidents - they're fundamental primitives of the language. Take those away and the entire thing ceases to exist.
Or, maybe not. Let's dig into this a little bit. Forgive me if this gets a bit detailed. First of all, the measure of "did well" seems to be "had a large increase percentage-wise in stock price". In a year in which the S&P 500 (a benchmark index against which other things tend to be measured) rose 13%, media companies rose a reported 16-43%. That is a good set of numbers. Picking two popular tech companies, Apple and Google I find that Apple (despite hitting a 6-month low mid-2012) is up about 43% and Google is up about 15%. Sound familiar?
Furthermore I see Apple is trading around $525/share and Google is trading around $733/share today. In case you've forgotten basic math - which it appears the Times has - a 15% rise in a $730 stock is a LOT more than a 15% rise in a $58/share stock (which is where Viacom appears to be today). Yes, percentage rises matter and yes performance compared to the S&P is an interesting number, but let's be realistic here.
It's worth digging into what, exactly, is powering this rise in the old-media companys' stock prices and it's two things. One is that they're using their cash to buy back stock and pay dividends. Tech companies - even the fantastically profitable ones - still tend not to do that. This makes the old-media company stock more valuable to investors, particular in times of sluggish markets. For those not into financial wonkery, it may be surprising to hear that the markets these days are extremely sluggish, with price volatility at all-time lows and trillions of dollars that used to be invested in the market having moved elsewhere.
So, a lower-priced stock that pays dividends is more attractive to investors than a higher-priced one that does not pay dividends. Not exactly earth-shaking news. More importantly, it tells us exactly nothing about the prospects for the future of these businesses, nor the media models they represent.
The answer: selling Internet. Most people get their IP connections from a cable company, and some cable companies scored big content deals with Internet companies this past year that further increased their bottom lines. Other companies (*cough*NewsCorp*cough*) did internal reorganizations to wall off big money-losing parts of their business. The result is a situation in which non-old-media revenue is propping up old-media companies. The broadband you're buying from that cable company comes with a hefty mark-up, and is likely a protected near-monopoly. Only a tiny fraction of the country has any choice in where to get Internet service.
All that fat-margin IP revenue serves to mask the fact that the television and cable-channel business is a dying enterprise. Both Thompson and Carr (Times) are careful to hedge their stories in the final 'grafs but I'll say it flat-out: old media companies will change or become walking dead in 2013-2014 and buried soon thereafter.
Most interestingly, though, he notes that many of Sullivan's readers "...pay $20 a day on coffee and lunch; it’s not a lot." That stopped me to think, as I don't spend that kind of money per day and it did seem like a fair bit to me. However, perhaps this means my perspective is too parochial. Perhaps there are people who don't think anything of spending $20/day eating out and for whom $20/year would similarly be below the threshold of concern, even if they had to pay it to get access to a dozen or so writers' contents that they wanted.
It's been received wisdom for some time that there are significant price-points in selling certain objects. You can get people to respond in highly non-linear ways by varying the price of something in a linear fashion. And maybe $20/year is that kind of a price-point. It's certainly true that people used to subscribe to many paper magazines that cost more or less $20/year. And some of us had comic-book or other habits that we were comfortable with as long as it didn't seem "too expensive."
So maybe I'm just an old cheapskate here and it's no big deal. What do you guys think?
A colleague of mine posted a link to this set of Flikr images by user b_carruthers. The set is called "Similarities" and shows pairs of images that are visually similar - some on purpose and some by accident. It's a good reminder that our laws about creative originality rarely line up with how actual artists actually create.
According to data from Nielsen SoundScan, reported in Billboard online, the week ending Dec 30 saw a record number of digital songs sold, about 55,740,000. This is a huge rise on the comparable week of the previous year, which saw 46.4 million songs sold. No doubt many of those songs were given as gifts over Christmas, but some also surely represent purchases by people who wanted digital music and didn't find it in their unwrapped gifts. This past year's rise is also significant in that it's continuing an upward trend from past years. The music sales business was in decline for much of the past decade, and only recently turned things around.
Titlow attempts to look at why digital music is growing, touching on the familiar themes of ease of use. Interestingly, he reports that "Sweden saw a 25% drop in illegal filesharing after the public launch of Spotify." This is more or less the trend I expected we'd see.
What neither Titlow nor Billboard address, though, is what the flow of money back to artists looks like. It's one thing to say that digital music sales are improving recording companies' bottom lines and a wholly other thing to say that digital music sales are helping creative types make a better living.
Last week I noted that so-called deep journalism isn't something that we know how to do well in the 21st century. Investigative reporting - the most common type of deep journalism - requires investments of time (months or years) and resources that are hard to sustain without a regular paycheck. Deep journalism also produces results that aren't easily amenable to summary, nor to the quick-hit forms favored by many social media such as news aggregators, Twitter, etc.
For example, Sullivan is intending to construct his site so that links to it don't ever hit the paywall. Bloggers and aggregators can feel confident pointing their readers over, which is an important step. This makes the paywall portion of their site extremely easy to circumvent - and that's by design. By analogy both NPR and the Times are listed as news entities who take no extraordinary effort to prevent people getting their content for free but instead depend on a combination of big contributors (or advertisers) and people being willing to pay for value.
Gillmor identifies what I see as the biggest problem with this philosophy - no matter how honest or willing any person is, they only have so much cash available. I can easily identify a dozen people whose content I find worthwhile to read pretty much whenever they produce it. However, if I had to pay $20 per year per writer I'd quickly find myself unable to continue. My guess is that this model will work OK for a few people but isn't going to scale.
The specific case he discusses involves a shell entity that had its law firm send around "pay up or else" letters accusing IT service providers of violating patents by doing normal business things - in this case scanning a document and mailing a PDF. The troll claimed to have a patent on this process, a ludicrous claim in the first place, and then wanted to enforce the patent against people using equipment, rather than against the manufacturers whose equipment was claimed to be in violation of the patent. But wait, it gets worse.
The protagonist of Mullin's story - Steven Vicinanza- decides to fight back and wins in court - yay! Except that as I blogged about a couple weeks ago, this NPE had rigged the game. The court victory just absolved one company - it didn't touch the patents and claims. Those toxic assets have apparently been distributed to "a network of at least eight different shell companies" that Mullin documents. Each of them is now spreading demand letters, blanketing something like 2/3 of the USA. And, like bullies everywhere, these trolls are targeting the small, poor, and presumably weakest defendants.
According to Mullins (quoting research by Professor Colleen Chien of Santa Clara University) this practice of suing users rather than makers is increasingly popular, presumably because they can be bullied into paying up more easily. Shades of the Copyright Cartel going after individual song downloaders!
As I noted last month, the legal landscape is vastly slanted in favor of this kind of activity. NPEs are immune to counter-suit, they can mass-mail demand letters to collect from the weak and the scared, and the cost of fighting them to the point of invalidating their bullshit patents would be much higher than the costs of paying their extortion demands. Yes, the patents are bullshit - ars links to them and you can go read them for yourself. Vicinanza apparently spent $5000 on a prior art search that was good enough to make the trolls run and hide, which leads me back to my tired refrain of "can we please get the USPTO to stop issuing crap patents."
You can read Mullin's story to follow the shenanigans that are still going on. It's pretty clear that the people involved are doing everything they legally can to hide their tracks, erase past identities that have gotten tainted, and make as many fast bucks as possible. It's bad behavior and bad news all the way through, so if you ever wondered why there's bad blood around patent trolls now you know. Certainly not all NPEs behave this way, and there remain good and valid reasons to use NPEs but that's going to get buried under the heaps of rubbish kicked up by abusers like this.
(Thanks to an anonymous Copyfight reader for the initial tip.)
In this case, what didn't happen in e-book pricing. Those of you who read Jon Sargent's (Macmillan) year-end letter will know that the people opposed to settling with the DOJ have pointed out that there would be nothing to stop a precipitous plunge in e-book prices. Except somehow that didn't happen in 2012.
It's possible, of course, that Amazon is just biding its time until all the publishers are settled, but that seems unlikely. Amazon doesn't discuss its pricing strategies in public, but it has shown it has extremely fine-grained control over what prices it offers on its millions of catalog items. It is fully capable of discounting some e-books while maintaining price floors on others. Instead, Streitfeld hypothesizes, the sustained higher price may be due to another things-that-didn't-happen: e-books have not displaced physical books, at least not to the degree predicted.
The causes cited for this are the usual ones, plus frankly there may be some buying fatigue among e-book consumers. People who bought new e-books or bought e-books for the first time seemed to be stocking up a large selection and it's possible they're taking time out to digest what they've already bought before making more purchases. It will be very interesting to see what the numbers look like next month once analysts have had a chance to digest the purchasing data from this Christmas season.
The other, more interesting to me, possibility is that we're starting to understand the shape of the niche that e-books will occupy in the sales ecosystem. As Streitfeld says, the demise of retail book outlets may itself be hurting e-book sales, particularly among the majority of purchasers who are either new to e-books or who still buy both e-books and physical books. These buyers may like the idea of browsing, holding things in their hands, etc - the physical aspects of book-shopping. That they then went home and bought e-books was bad news for the retailer, but if in fact that first step is important to the e-buying process then the lack of a physical presence may spell trouble for e-book sales and for converting physical-book readers into e-book readers.
In addition, e-books are generally tied to a physical product - their reader. You can discount a book if you're selling a reader at a good margin. But if the market for readers is saturating and you're having to discount readers then you may not be able to sustain losses on e-books. Likewise if you depend on sales of a reader in order to push e-book sales then the fortunes of the two will tend to rise and fall together.
So yes I expect e-books to get cheaper in 2013, but not by much. For prices to drop significantly publishers will need to retool their businesses to be able to pass on the cost savings of digital production to end readers, and to do so in a way that doesn't destroy their physical-book pipelines in the process.
Post says (and I agree wholeheartedly) that the authors of this report are wrong on historical ground, and wrong on the merits. He notes that there's literature and scholarship on this question and in general there's Constitutional scholarship that shows what the framers intended was that the Constitution embodied a grant of rights from the people (as represented in the Convention) to the government. There's nothing to support a "natural rights" argument that I know of.
And, as I've said repeatedly in the past year, it's pretty clear that what Post calls the "utilitarian" analysis is also failing badly - IP as we currently practice it is inhibiting creation, not promoting it. The economic justifications made for the continual expansion of protectionist regimes are purely for the benefit of large corporations. Individual creators are trotted out regularly as excuses but when it comes to writing the checks the Cartel are nowhere to be found.
The survey also repeats conclusions we've come to in the past decades of the copyright wars. Lack of any publicly streamable alternative such as Netflix or Hulu led to HBO's "Game of Thrones" doubling its US viewing numbers through illegal copies. This is the same lesson that's been on offer since early Napster days.
There's also a continuing correlation between delayed release and illegal copies. Australia, where people are supposed to wait an arbitrary extra week more than the rest of the world for things, tends to score highest in the illegal viewing numbers. Well, duh. If the Cartel haven't yet figured out that worldwide simultaneous release is good for business and delayed releases are bad I'm afraid I can't help them.
The story lists several major court and police actions taken against sites such as The Pirate Bay, Megaupload, Newzbin2, and Surfthechannel - all of which were taken offline in whole or in part the past year. Shockingly, taking down big-name linking or torrent sites doesn't actually reduce the flow. This is the same lesson that should have been learned when Napster was first shut down. I used to refer to it as "smashing mercury with a hammer." It's visually satisfying and absolutely ineffective at reducing the amount of mercury.
Perhaps a slightly new lesson is that most of the top copied titles are behind paywalls. That would indicate that paywalls themselves don't reduce piracy, but leaves open the question of how the owners of the shows should create revenue. Just because something costs money isn't an excuse for illegally copying it, but it does indicate that there is a consumer marketplace that's going untapped.
Of course, the Cartel's response is not creative thinking on how to market to those consumers - it's a repeated effort to pass draconian laws. I think I'm safe in predicting that those won't be any more effective in 2013 than they were in 2012.
Meanwhile, in a minor fit of sanity, both sides have separately agreed to withdraw requests that judges block sales of each others' products. Lawsuits will continue until the sun goes nova and grows cold, one expects.
Three items from the backlog and I'll put them all in here under the same heading. It's clear that 2012 saw lots of streaming services but little differentiation and not nearly enough cash-flow. Companies that survive through 2013 will be those that can separate themselves from the pack and convince customers they've got something worth paying for.
What Netflix can do is not just pick a potential original-series winner via its algorithms, but it can price the offering according to individual wants and tastes. It can bundle the series with peoples' existing subscriptions, it can offer a higher-cost tier that includes original content, and it can offer a pay-as-you-watch model for people who are unsure that they will indeed love the new content. This is the true advantage of an Internet-based company over a traditional cable-channel company and it's where I expect them to win big.
Speaking of data, Tim Westergren of Pandora showed up on TechCrunch last month to tout his company's ability to use data to help artists. Carefully avoiding the sticky financial questions that have dogged the service in the last couple years, Westergren concentrated on the potential of a direct connection between musicians and their listeners. A connection facilitated by Pandora, of course. If I read between the lines of what Westergren is saying, it appears that he and his company are making a play for the independent artists. A big-name, label-backed act isn't going to see much (if any) revenue add from Pandora. So why would someone let their music be streamed on the service? Because it means discovery, because it means being connected to the people who want to listen to your music, and because it means learning enough about those people that you can adjust what you do to reach them and make more money from them. Whether it's something as simple as picking the right people to show CD sales discount ads to or as tricky as figuring out which cities you want to hit with your limited tour budget, data is going to be your friend. If Pandora has the data then artists may find the whole deal profitable enough to participate in.
As with many such sites I've long been able to follow artists, favorite things, and so on. Recently they added Facebook-like dashboard and "who likes who" features. Despite my initial skepticism I've found the features really useful. Like Facebook, SoundCloud now gives you a Dashboard on login that shows you things your favorite artists have uploaded. But you also get to see things they favorited on the site. This isn't technologically new, and certainly other social media sites such as Twitter let you favorite things. It took me a while to think about this and try to understand why it works better here than there.
What I think makes it work is the specialized nature of the community. On Facebook I have over 350 "friends" and they have a wildly varied set of interests. My personal interest in those 3500 things is small or none for many of them. So if a FB friend likes something its information value to me is low. On SoundCloud not only do I have a much smaller set of people I follow, each of them is a working artist with an active interest in hearing and using new music. What interests them is likely to be fresh and interesting to me as well. That's not guaranteed, but my experience in the past month is that it has a better than 50% hit rate, which is way higher than any other social-media site I've used.
SoundCloud is also linking to the rest of the world, but to my eyes that's not going to provide unique value - it's just a convenience. What's making SoundCloud a site I return to over and over again is the active participation of engaged people with high levels of knowledge and similar interests to my own. How that turns into revenue for SoundCloud and the participating artists is still to be seen, though.
Following Canada's lead, it appears that the UK is set to introduce a number of important private exceptions to copyright restrictions that will help regular private users, users with various disabilities, educators, and so on. Michael Geist has the whole list in his blog. The overall idea seems to be a recognition that activities people do for certain reasons, such as individual back-up, classroom teaching, etc. are not inherently violations of the commercial marketplace's enforceable copyright restrictions. These exceptions don't touch on commerce; instead, they appear to add a hefty amount of sanity to recognizing that peoples' everyday activities are not theft.
Instagram Isn't Owning, Just Granting Itself License
An astute reader pointed out that I had misinterpreted the new Instagram Terms of Service. As they've hastily tried to clarify, they don't claim "ownership" of your pictures, they just (and here I'm quoting the ToS) require you to: "grant to Instagram a non-exclusive, fully paid and royalty-free, transferable, sub-licensable, worldwide license to use the Content that you post on or through the Service..." Got that? It's a subtle distinction - owning versus getting to use however they want - apparently too subtle for me. And remember, still no way to opt out except closing your Instagram account.
He also notes that they're the last one standing in the DOJ suit over e-book price fixing. Penguin and Random House have agreed to the DOJ's terms, presumably so there won't be an impediment to the merger, leaving only one party to emerge from the court-ordered mediation process. If nothing changes, then trial is scheduled for June of next year.
It's sad that Sargent doesn't see the writing on the wall. He notes that they were sued by the DOJ, 33 individual states, a class action group, and the European Union. It's possible that all of those entities are wrong and Sargent is right. But I wouldn't bet on it. That's a lot of attorneys and attorneys-general who all saw the evidence and thought it was case-worthy. Maybe Sargent and his lawyers are smarter than everyone else on the planet, but I wouldn't bet on that either.
It's sad that Sargent can't see that the moves Macmillan have made precisely miss the mark. He's happy that his company have negotiated new agreements that "...allow 10 percent discounting on individual books priced at $13.99 and above..." Uh, whoop de do? We've had ample evidence in recent months that there's a lot of market to be made in lower-priced e-books. If Macmillan can't make money with its current cost structure on lower-priced books then maybe the right thing to do is change that structure, not forbid discounting. Macmillan's new agreements are still too restrictive, despite his claims that "[a]ll the new contracts are compliant with the government’s requests in their complaint."
It's also sad that the government's settlement offer is so awful and they won't budge. They believe they have a winning hand (particularly now that everyone else has settled) so there's little incentive to budge, but the fact remains that the DOJ is pretty much handing Amazon the e-book world on a plate. That's unnecessary, and will result in a monopsonistic environment. The DOJ could have been much smarter about this, though given its track record with, say, financial institutions it's doubtful anyone inside there knows how to craft any sort of settlement. But I digress.
The saddest part of Sargent's missive is that he doesn't yet have good data on the effect of going DRM-free. The most revolutionary and potentially freeing move in e-books in 2012 is likely to be swamped by the effects of the suit and trial to come.
Look, the America Invests Act (AIA) is an interesting piece of legislation with some good ideas behind it. Like any bill that makes its way into law, those good ideas are sort of diluted and distorted from their original form in order to make the compromises necessary to get a deal done. Fine. Good. That's how these things work.
But in this case, it's not a matter of compromise so much as it is an uncompromising unwillingness to put his own house in order that's affecting Director Kappos. Early in December he gave a speech in which he touted certain provisions of the AIA, particularly what's called "post-grant review", as a solution to the current patent-litigation mess. In this review people who aren't involved in the original patent are allowed to challenge a patent once it's issued. This is similar to what I discussed as already happening in my previous patent-system post but it has the advantage that you don't have to go through a whole trial in order to make a challenge happen.
That's good, but it's still too late. And Lee is spot-on in his response to Kappos when he says that the speech "...ducks the central question in the software patent debate: do patents, in fact, provide a net incentive for innovation in the software industry?"
Indeed, and Kappos's focus on post-grant review is itself a tacit admission that the USPTO is giving out patents that it shouldn't. Obviously, if it issued better patents in the first place there would be no (or at least much less) need for post-grant review. If we're going to have any hope of hacking ourselves out of the current weeds we absolutely must push the solutions upstream to the application and review stages. How about that, Mr. Kappos?
Tobias Buckell, At Length, on His Kickstarter Experience
It seems wrong to write so few words in response to a 5,000 word heartfelt experience report, but really I have not much to add except, "Go read this!" Buckell is what we used to call a mid-list author and his Kickstarter story is really important to understanding how someone who has some fans but isn't A Very Big Name can use a lot of hard work and new (self)publishing models to change their career. (h/t John Scalzi's "Whatever" blog for the original pointer)
The short answer may be "yes". Commentary in a recent issue of Greg Aharonian's PATNEWS email newsletter (not on the Web, sorry) highlighted several points that lead one to think we may have brought this on ourselves, at least to some extent.
As I noted a couple weeks ago, there's a significant advantage to doing your patent litigation through a non-producing entity (NPE) in that the NPE is effectively immune from competitor counter-suits. Since they make nothing, they violate no patents themselves. In addition, you can (and here I use the term advisedly) 'rig' the NPE to be little more than a shell, with few or no assets that could be taken in the case of adverse judgment. This is similar to the shell game that corporations (and individuals) often play, separating out assets that could be seized from any legal liabilities - just now it's being applied to patent lawsuits.
In addition, PATNEWS reports, there was a rule change in how one can file a patent suit. In particular, new rules limit the number of defendants that can be named. In one way that's good, because it prevents suit-happy patent holders from sweeping huge brushes around, hoping to catch someone who would rather settle than fight. But in practice what it has meant is that instead of one suit with 10 defendants, NPEs now file ten separate lawsuits. The result is an apparent inflation in the absolute number of lawsuits, but that's something of an illusion.
It's not wholly illusory in that the ten separate suits are a larger burden on the court system - this is why courts often try to consolidate cases where possible - but it does mean that there may not be so large a rise particularly if you compare "number of patent lawsuit defendants" on a year-over-year basis.
Another commenter pointed out that reversals (at appellate level) of district court rulings has risen to nearly 50%. A reversal can come in many forms - sometimes a case is reversed and ended, but more often a reversal means it's going to be appealed further or be remanded back down to the lower level for a new trial. As the number of reversals goes up, the overall count of cases goes up. And of course a retrial may itself result in an appeal, and so on and so on.
Reversal on appeal also complicates matters. Generally speaking it's the trial court's job to find on matters of fact. On appeal, each side more or less has to accept the facts as presented at trial but argues that the law was inappropriately applied or that there was some other procedural error. In effect the arguments on appeal of a standard case tend to be totally different. However, in patent cases, the appeals court can sometimes rule a patent or patent claim invalid. This can force a whole new trial as the losing side now has to make its case with lesser (or at least different) facts available. The result, again, is an apparent increase in the number of patent trials.
None of this is to say that there aren't too many NPEs nor horrid abuses of the court system (as there are horrid abuses of the patent system). But it does point out that people bemoaning the current patent litigation system may need to examine things a little more closely. And because I like being right, I claim this sort of analysis lends weight to my assertion that trying to fix the patent system problems at the court level is too late. We must make fixes upstream, at the application, review, and granting stages.
I realize that's an appealing and perhaps even common-sense notion and they even quote a graph with the word "Causality" on it, but that is not in fact what is going on and it's not even what the original graph ought to be claiming.
What happened, near as I can make out, is that an outfit called Next Big Media did some data analysis. They looked at some public numbers, such as hits on an artist's Wikipedia page, publicly released iTunes sales, and so on. Then, to their credit, they did some actual statistical analysis. In particular, they did what's called a Granger causality test, which attempts to show that one variable has enough predictive value in its time series to be assigned causative agency in another variable.
Causative agency is much stronger than the usual notion of prediction and it's a tricky thing to pin down. You can, for example, see that in certain months there's a large rise in the number of people wearing overcoats. The calendar date is therefore a good predictor of overcoat use, but it's not a causative factor.
Using a Granger test is good in that it avoids the most simplistic "correlation = causation" failure. However, as Wikipedia and other sources will tell you, Granger Causality is not necessarily true causality. For one thing, it's a test that works only when you have two variables, not three (or more). For another, it's known to fail when there's a (so-called hidden) variable that also follows the same time series. In this case, we can call that variable "popularity". What this study is telling you is that if you can tell when someone is getting popular then you can predict they're going to sell more music.
This, ladies and gentlemen, is not particularly enlightening. We know this, and we further know that public resources such as Facebook pages, Google searches, and Wikipedia article activity are reasonable measures of popularity, particularly when you measure what's popular within the limited subset of the population that is online and connected. Unsurprisingly, this is also the subset of the population that is most likely to buy from iTunes rather than Wal*Mart or other physical music retailer.
There are other methodological flaws in the study - for example, they seem not to be taking into account things like "has just released a new album" or "has appeared on The Simpsons" or "is touring my country" or any of a zillion other factors that may cause jumps in social media popularity, and likewise jumps in sales. I could go on, but you get the gist.
I realize that news outlets have to fill a certain number of (even virtual) column inches, but really when the best thing you can conclude is "artists should make sure their Wikipedia pages are updated and maybe get on Twitter too" - that's pretty lame.
If you aren't familiar with gaming and YouTube, let me give you a bit of background. People who game love to make videos. They make response videos, they make trash-talk videos, they make commentaries. There are also millions of helpful videos - everything from "see this cool mod for this game" to "here's a walkthrough of that tricky bit in Act 2." One of the best ways to judge the vibrancy of a game is to search for it on YouTube. A game with a lot of fans will have a lot of vids and those vids will have recent responses and active comment threads. So when a gaming company steps in and starts hacking away at the fan video activity around their games, it's a big deal.
The picture is complicated by the fact that many fans make money on these videos. There are gaming channels and people who are paid to do walkthroughs, to publish guides for third parties, to live-stream competitive gaming matches, etc. Some of the people who do make money at this have complex agreements with the games they cover, but most of the smaller players do not. So when Sega issues DMCA orders against vidders the result can be the suspension of an entire channel or YouTube user, cutting off legitimate sources of income, not to mention running roughshod over fair use. The professional game-caster known as "Total Biscuit" noted that Sega has even targeted videos of people talking about the game, with no Sega material shown.
In this case, Sega's actions have been oddly specific, targeting pretty much everything related to some very old content. The theory is that they're going to put out a new installment in the franchise and want to control what items come up in searches. I can't express my level of disgust at a corporation using the DMCA to sabotage someone else's Google-juice.
Guy Kawasaki, a man with more than a few books to his name, did a piece on Minnesota Public Radio on self publishing. He lists five benefits and three drawbacks, all of which we've touched on to some degree. In his Google+ posting highlighting the show he called attention to the extensive comment (currently first on the list) left by a woman who has used self-publishing to turn around completely her experiences as a romance-novel author. It's a good reminder that you can't easily lump together all the different segments of publishing and get a unified picture. Romance is not textbooks is not reference books is not SF/F, and so on.
Well, sure, they retracted the memo as soon as someone in the Cartel noticed it and picked up the phone to complain, but hey at least there are people inside the party thinking innovatively about... wait? What's that you say? They fired his ass?
No, really, I can't make this stuff up. I suppose this is some bizarre marketroid's idea of how to prevent you from ever taking your business elsewhere. Not only will we not sell rent you new e-books if your card has expired, we'll just glue shut the pages of ones you thought you already owned. Insert Cartoon Evil Villain Laugh here.
As Consumerist (and following up Techdirt) point out, it's not the e-book per se that is at fault here. It's the DRM. The DRM lock is what is preventing this legitimate user from reading her legally purchased e-books. The fact that she will now have to become a DRM criminal too is a shame.
However, saying "it's the DRM" is sort of like blaming the car that blew through the stoplight and rammed into you, as thought the car had no driver. The DRM exists because companies put it there, and it's configured to enforce paranoid and crippling restrictions because someone - a person, or group of persons - decided it should be so. "Paranoid" and "stupid" are not properties of software; they're attitudes of people, who choose to use, encode and configure the software. This is not a fight about technology, it's a fight about social and business policies. And one of the most effective ways to change business policies is to take your business elsewhere.
B&N has clearly shown that once you give them the slightest chance, they'll do everything they can to lock you in. So take your money elsewhere, people.
Some of you may recall that I work in finance. So I was kind of surprised to read last month that a patent spat has broken out in the options trading world. As Joe Mullin notes, the trading world has not been super-saturated with patents. This particular dispute is over patents on ways of matching trades using not just the order data themselves, but also including market data (quotes).
The current round is actually a continuation of a long-running battle and will have a big impact in terms of who gets to offer what information, and what trading instruments, to investors. This is a big deal since the crash in the US markets happened a few years ago. Although prices that are in the public eye (such as Apple's stock price, or the much-overhyped Dow Jones) have regained their values, what's missing from the picture is volume. A lot of money has left the markets - trillions of dollars by most estimates - and much of the exchanges' business is based on volume. The result is that competition for flow is at an all-time high and entities that can establish themselves as a sole place to trade something desirable will be in a much securer position.
This will tend to lead companies in the direction of IP struggles; however, the financial sector has had a pretty long stream of negative press. Getting involved in more patent disputes is only going to make more bad headlines and scare away more investors. As a result, I think things will stay largely tamped down and we won't see the financial sector erupt into the sort of all-out patent wars that high tech is getting known for.
The story is a little short on detail, and references the Village People legal case I mentioned a few months ago. The big difference I see is that authors - particularly those who write novels that end up on bestseller lists - usually work through agents. These agents often handle all publication rights for the author, even though they don't hold the original copyrights, nor are they assigned the rights. They negotiate the contracts, though, and if those contracts are going to be broken or amended through the Termination Rights process then these literary agents are likely to be involved again. And as Jeff John Roberts notes in his column, it's not clear how widespread the knowledge of the law's provisions are, or who actually understands them. They're not really as straightforward as one would like, since they require advance notice and have a window in which they can be exercised.
Last month, Steven Levy had an extensive piece in WIRED with the title "The Patent Problem." Levy is a long-time tech journalist who's probably best known for his in-depth books on tech and culture, starting with his Hackers up through last year's paean to Google called In the Plex.
To my knowledge, Levy hasn't written much about patents or IP before, but he brings his exhaustive attention to bear in this article. It's long, and I won't try to summarize it - you should read the original. Levy doesn't fall into the trap of assuming there is a single problem with patents, despite the article's title, that would be amenable to a single solution. He touches on several things including the changes to what can be patented (so-called process patents), the fact that companies are deliberately abusing and overwhelming the USPTO with crap, and particularly the proliferation of entities that view patents as weapons or money-making machines. All of these factors have combined to create a potentially very profitable business model around what are called (politely) "non-patenting entities". These companies make no product, but have a business around owning patents and suing people who are claimed to infringe them.
The less-polite name for these NPEs is 'patent trolls' and trolling is a major focus of Levy's article. He notes that NPE-originated litigation is increasing rapidly, that courts have often favored existing patents with a presumption of validity, and that NPEs can engage in a variety of asymmetric warfare. Since the NPE makes no product it can't be counter-sued. The best that a defendant can muster would be a challenge to the patent's validity or scope.
Levy deploys a reasonable set of statistics to back up his proposition, though I would have liked to see more. He does admit that it's hard to distinguish a troll from a legitimate NPE that is protecting the interests of companies who license their portfolios. Certain trolls have grabbed a lot of headline attention, but that just makes them bad examples, not necessarily a valid majority or trend. That said, I think the key point of the article can be soundbit:
Instead of promoting innovation, patents are used as a weapon to stop it.
This difference goes back again to the language in the Constitution that allowed Congress to establish patents in the first place. I've been reading more in Copyright Unbalanced and one of the points that the authors in that book make repeatedly is that there is nothing natural or required about patents. We've had them for so long it's not surprising that people think they're a necessity, but in fact they were invented for the US as part of its founding documents not because anyone felt that individuals or corporations needed to enrich themselves, but because it was felt that having government-granted monopolies of this sort would lead to a better society.
What Levy is saying, I think, is that present practices around patents are directly attacking that feeling, which is still widely shared today. Unfortunately he has no more solutions to the problem than others who have pointed it out before. I continue to believe that focusing on the courts side of things is the wrong way to go. By the time a patent winds up in court it's too late to do much but apply another band-aid. What's needed is reform at the application and issuance stages. Not to put too fine a point on it: if you keep the crap out of the system, then the system ought to work better.
Shortly after SOPA went down for the count early in 2012 there was a spate of analysis over what the post-SOPA world would look like. I don't think that we yet have a good idea of the shape of that world which means there's an opportunity to go out and make it happen ourselves. To do that we need to forge cross-ideological alliances and this book may show where common ground can start.
While I (and about a quarter-million other sane people who signed Jimmy Wales' petition) am naturally pleased that he won't be forcibly extradited, this does not solve the central problem. A foreign national was prosecuted in the US for allegedly breaking US law despite never having been in the US, nor having any of his computer equipment in the US. The US Immigration and Customs Enforcement agency has become the Cartel's INTERPOL, and vast amounts of resources were wasted on a guy charged with linking to other online material. Neither ICE nor the Cartel is known for having a sense of proportionality and there's nothing in this resolution to stop them repeating this behavior.
He directs a shot specifically at Pandora, which I noted last time was trying to improve its image of being too stingy with payments, and Spotify. He gives specific numbers showing that the total payments by these services that end up in the musicians' pockets amounts to pennies - and not that many pennies either. But his major complaint isn't with the services named - it's with the model of streaming music as a business.
As Krukowski lays it out, the streaming companies aren't making profits either, so it's not like they're ripping off consumers and artists and pocketing the wads of cash. Instead, he notes, they're just businesses in the business of being businesses. They grow their companies' values, in ways wholly divorced from the music business.
On the one hand, I'm sympathetic to this. It's got to be frustrating for someone to try to make a living having no idea how to price and distribute what they make so that they can have a real income. Krukowski links to where you can get all of his bands' music streamed for free anyway. The difference between free and the services' pennies isn't that big a deal, clearly.
On the other hand, you could just as easily accuse Apple, Amazon, or Wal*Mart of being "divorced from music" even though they all sell a crapton of it. That's not a reason to dismiss the contribution each of these giant retailers makes to selling music. Rather, it's a reason go to back and say "If big retailers can make money on, and pass substantial revenue to artists on, music why can't the streaming services?"
It's clear we haven't gotten the model right yet, but it's still very early days. I'm not willing to give it up before it's been really tried.
Called Copyright Unbalanced, the book attempts to capture current thinking from conservative and libertarian writers on how current US copyright law has gone awry and what might be done to fix it. Solutions include fighting against "crony capitalism", rolling back criminal penalties and forfeiture in copyright cases, and returning to a more originalist vision of copyright, in which the monopoly is given to serve a public good, not to enrich corporations or individuals.
It seems to me that - as happened with the opposition to SOPA - the current utter disaster that is our copyright system is a place where major elements of both left- and right-wing social/political thinkers can come to useful agreement. Liberals aren't uniformly opposed to big government, but tend to favor open intellectual exchanges, which current copyright regimes are crippling. Conservatives oppose government's continual expansion of its powers and certainly the repeated extensions of copyright's scope and reach fit that description. And libertarians often seek rational bases for restraining governments' powers; in my opinion the current management of copyright has strayed so far from its Constitutional intentions as to be irrational. Thus I think we need to cooperate on finding ways to reign things in.
However, as Jerry Brito comments in the linked entry above, this need is likely going to fall into the same generational gap as opposition to SOPA did. The older, established parts of both Republican and Democratic parties are beholden to the entertainment industry for dollars and are locked into old-model ways of thinking. The younger and more dynamic parts of the parties (e.g. techno-libertarians and Internet/social media liberal-progressives) will find themselves fighting the party elders on this issue. And as I mentioned in the entry earlier this month I am sadly lacking in hope that the second Obama term will be any better in this regard than his first, no matter how much he used the younger parts of the Democratic base to get re-elected.
Issa isn't known for being quiet - tech folk admired him when he took a stand against his own party and committee chairman to oppose SOPA. He's also pissed off more than a few people by making some outrageous statements on subjects such as the ATF's failures, the attack on the US consulate in Libya, denying climate change, and other topics. So maybe this is just him grabbing more headlines and blowing more hot air. Or maybe he really can pressure the new Judiciary Chairman to produce something useful.
I confess I'm not holding my breath. But I'm old and cynical about anything useful coming out of Congress these days.
Independent e-book publisher Fictionwise is ceasing operations. They blame the demise on backing the wrong technological (format) horse. Fortunately for Fictionwise's readers, their accounts won't go away entirely. Fictionwise has arranged to transfer readers to B&N's Nook Library infrastructure. As one of my friends pointed out, though, this FAQ is conspicuously silent on the question of DRM, which Nook has and Fictionwise did not.
NPD continues to produce shill material for the Cartel, pushing its anti-sharing and anti-customer messaging. Last time I pointed to how they were drawing wrong conclusions from their data; this time Geist points out they can't even do basic math. And of course getting math wrong means you get your message wrong, in this case hilariously the opposite of what they're paid to shill.
The root of the issue is that NPD are trying to show that using P2P systems (presumably to share music) causes one to spend less on music, measured by spending on CDs, downloads, music service subscriptions, and so on. But aside from getting simple addition wrong (by double-counting a subtotal) what Geist points out is that NPD's own data show that P2P users spend roughly 50% more, particularly if you don't accept NPD's dubious assertion that spending on merchandise and concert tickets doesn't really count - because somehow being a fan who downloads music is separable from being a fan who buys tickets and merch.
Yeah, right. When you all get back from fairytale land, let me know. Meantime I continue to be disappointed by any serious journalist who publishes anything NPD produces, except for mockery purposes.
I thought this was interesting in light of Weinstein's call for severe penalties on IP abusers. The UK (both in its High Court and later the Court of Appeal) case of Apple v Samsung has not gone well for Apple, which was ordered to post public notices online that Samsung did not infringe as Apple had alleged in its suits.
Apple, in Foresman's words, "thumbed its nose" at this order and inserted language that made it appear the UK decision was out of line with other court rulings. In response the Court of Appeal published a final order that tightened up the language Apple is required to use, as well as requiring that Apple pay Samsung's legal fees "on an indemnity basis" which apparently means more money than would otherwise have been paid.
It's not clear to me whether the Court of Appeal in the UK can find Apple in contempt and assess further penalties, but clearly they are in no mood to tolerate further mucking around.
In his blog post today he takes on the current high levels of patent and copyright legal activity, the ills of which have been amply documented. He focuses on what he sees as "extortion" in which the threats of patent lawsuits and copyright infringement (DMCA takedown) notices are used to harass, suppress, and otherwise impede actual work and innocent people, as I noted again last month.
In response, Weinstein suggests putting in place fairly draconian penalties for abusers that would raise the cost of misuse of the system, including large fines and other unspecified penalties. Weinstein suggests that some unspecified "courts or other designated third parties" would make determinations as to what penalties and when to invoke them.
As sympathetic as I am to the core idea - abuse of the copyright and patent system ought not to be free and easy - I am concerned that adding more costly litigation and other processes to the mix will not solve anything. Severe penalties ought to serve as a deterrent, but in practice they do not. For example, Apple is facing the possibility of a patent-related injunction that would block sales of major product lines. This does not deter Apple; instead, it just means that more court cases will be dragged out for more years. I imagine that the lawyers involved will be enriched, but probably nobody else. Lest anyone think the Apple case is unique, I remind you that in August, the Lexmark case popped up again. That case has been going on for eight years now, and there is no end in sight.
Protracted litigation is always bad for those without money, which is to say exactly the small-scale entrepreneurs and individual creative types who are suffering the most from the current copyright and patent insanity. A related notion, loser pays, has been proposed and is used on a small-scale basis. It, too, seems not terribly effective but perhaps that's because it needs to be tested at a larger scale. Other solutions, including compulsory licensing and patent invalidation, could also play a part in restoring sanity.
Nobody wants right holders to be stripped entirely of their ability to defend their limited monopolies. Some level of balance needs to be re-established, making abuse costlier without ruining the entire value of a copyright or patent. I just don't think nukes are going to help.
In a completely un-shocking move, Judge Koh has agreed to hear motions and arguments on the question of whether the foreman in the well-publicized Apple/Samsung trial improperly influenced jury deliberations. Unless I'm mis-remembering, about 48 hours after the verdict was returned SCOTUSblog said this would happen. The guy may even have lied during voir dire which might be grounds for a whole new trial, not just nullification of the verdict.
Geist says that the Court's decision rested on the notion that the patent claims themselves were not sufficient descriptive to permit a skilled person to replicate the invention that is supposedly disclosed. Patent critics have for many years railed against badly written patent claims and the fact that examiners, particularly in the US, seem willing to let patents go with badly drafted claims. Here we have a clear situation of a high Court rejecting that kind of sloppy (inadequate) patent claims construction.
I don't think that the Canadian decision will affect Pfizer's patents in other countries (e.g. the US) but practically once a generic version of a drug is manufactured it's impossible to stop its trans-national shipment. Gods help us we'll probably see an uptick in spam emails for "generic Viagra" now.
As Lyons notes, this time Apple lost a round, and the winner VirnetX is asking for major injunctions on sales of Apple products that were found to infringe. The injunction is way more important than the penalty, which amounts to slightly more than the bar tab at your typical corporate board meeting. Given that, Apple will have no choice but to appeal and the mess will drag on.
What made this article interesting to me was Lyons's "What's the Point?" section. He doesn't mince words, calling Apple's strategy "despicable" and asserting that Apple is "us[ing] the legal system as a kind of marketing tool, a way to smear [its] opponents". Apple, he notes, is doing everything in its power - particularly through this barrage of lawsuits - to give itself a public images as a pinnacle of original innovation from which all lesser mortals must copy. Prima facie evidence is its unwillingness to cooperate with a UK judge's order that Apple publicly correct the record after losing a case against Samsung.
I think that makes a lot of sense and provides an answer to the question of why Apple would embark on this crazy campaign in the first place. It's sad and shameful. Fortunately, as Android's market-share numbers continue to climb it's clear that the strategy isn't working. So please, Apple, can we stop now?
As I noted in that September blog piece Ralph Oman, a former Register of Copyrights, had filed a bizarre amicus brief in the case, which asserted that
...when the law is ambiguous or silent on the issue at bar, the courts should let those who want to market new technologies carry the burden of persuasion that a new exception to the broad rights enacted by Congress should be established.
In English, this means that anything not expressly permitted should be forbidden (by copyright law at least) and as Post puts it, bluntly, "That is flat-out wrong."
The brief, authored by Post and signed by 34 law professors, argues that Oman is not just incorrect, but is trying to turn the entire principle of law on its head. Congress must, the brief states, balance competing needs but where it has not definitively spoken there is no justification for a court to make a restrictive and one-sided ruling such as Oman advocates that would shut down whole new sectors of industry just because they lack governmental pre-approval.
Post (and the brief) appear to be advocating for a strong form of what I've called the Breyer Test (after Golan) in that he too believes the authorial monopoly is there not so authors can profit but because allowing authors to profit increases "...the creation and the availability of creative works to the public." Now if we could just get Congress to write that into copyright law things might get a whole lot better.
Scalzi points out that the Humble Bundle had two salient effects that are hard to replicate. One is that it represented a very large number of units sold in a short period of time. This may happen when an author releases a new e-book but Scalzi's book in the bundle was not his newest volume; it was an older title that had already sold well. So getting a big burst of sales on an old title was a new phenomenon. Two, the bundle allowed him to sell the first volume of a series to a large number of readers. People who buy the first volume of a series are likely to pick up subsequent volumes and Scalzi reasons that he may get substantial uptick in sales of the rest of the series, for which he'll be paid the normal amount.
Most notably to my eyes is his calculation that people buying this e-book were not the people who would normally buy his books, as his weekly e-book sales didn't take a dip while the Bundle was on offer. This is very strong evidence that the readership for e-books is nowhere near tapped out, and that pricing is a significant factor in bringing more of that readership on-board. This is something that successful indie authors (see for example Joe Konrath) have been claiming for a while. But big publishers have been uniformly resistant to lower- and flexible-pricing models on the theory it would cost them sales. Time to look again, oh agency-price-raising-lovers.
About the time of Scalzi's post, Cory Doctorow tagged an open letter to e-book publishers on the current marketplace mess. The post, from Joanna Cabot of TeleRead, pleads with e-book retailers to treat their customers "...like a real person, and given the trust to use my purchased content sensibly, and with some allowance for real life."
The issue at its heart, is the DRM-encumbered misbehavior of e-book retailers such as Amazon and behind that the paranoia of e-book publishers. As Ms Cabot says, publishers "need to get over this idea of the ‘lost sale.’" If you listen to e-book publishers you'd think that all their customers were thieves just waiting for the opportunity to steal e-books. (I'm reminded here of Amanda Palmer's comment on how music execs view fans.) What Scalzi's numbers show is that Cabot is on the right track - given a chance to set a slider to zero and get e-books for free, people instead chose to pay something for the prospect of value. DRM-free value, I should repeat.
Where I disagree with Cabot is in the conclusion that if e-book publishers don't get a clue then readers will take their dollars elsewhere. When agency pricing was introduced and prices jumped 30% overnight there was not a commensurate fall in e-book buying. Sure, people bitched, but they still paid up. That's why I think that experiments like Scalzi's are so relevant - we need data to show that there's a bigger marketplace waiting to be captured and that it's in the publishers' interests to go after it. A good first step would be following Macmillan into the DRM-free lands, but that's only a first step.
It's generally hard these days to be a Safe Harbor defender. The key provision of the DMCA that permits high-volume sites to operate more or less freely - without pre-approval - requires that they also be willing to respond to take-down notices. And this is where the trouble begins: takedown notices get seriously abused; people file takedown notices for material they don't even own the rights to. The DMCA provides no sanction or penalties that might curtail this abuse; someone can spam DMCA notices like they would spam Viagra ads and nobody is likely to stop them.
The facts appear simple: some years ago, a blogger at Edublogs published copyrighted content. According to WPMU.org, another site hosted by ServerBeach, the offending material consisted of 279 words and was published in a 2007 blog entry.
Pearson, the educational technology company, owns rights to that material and sent a DMCA notice earlier this month to have it taken down. The notice passed through to Edublogs administrators who, as the BBC noted, used a simple Wordpress feature to make sure the entry containing the disputed material was only visible internally. This, however, did not satisfy ServerBeach, which took upon itself the role of "three strikes arbiter" and less than a day later shut down 1.45 million edublogs. That's all million-and-a-half blogs, all entries, blacked out.
Think you might be overreacting just a WEE bit there, ServerBeach? The hosting company claims it had no choice but to black out the entire site since it couldn't selectively block a single blog or page. Now, aside from being complete technical nonsense, it's also legal nonsense. Technically speaking, any ISP can selectively block traffic to or from any URL it is the host for. It may not be a trivial switch to throw, but the capability exists; claiming it doesn't exist is just stupid. And really, it's not ServerBeach's job to be a copyright cop. That's the whole point of the DMCA - ISPs get Safe Harbor by acting as neutral third parties. The copyright dispute exists between Pearson and whoever is determined to be responsible for the publication of the material, which might be the article's author, the blog owner, or Edublogs, in some combination. If the owner (Pearson) wasn't satisfied with the action taken to remove the material from public view, it should say so.
The story got a round of attention in both the tech and mainstream press, but to my understanding ServerBeach continues to defend its position and actions. Which, if I was Edublogs, would be prima facie evidence that a new ISP is needed, and pronto.
(Thanks to Copyfight reader Ross Hudgens of WPMU.org for bringing this story promptly to my attention; it's been languishing in my queue for almost two weeks now.)
Earlier this week I was invited to listen in on the inaugural press conference for a new lobbying organization calling itself the Owners' Rights Initiative.
The group, composed primarily of resellers (e.g. overstock.com), retailers (e.g. Powell's Books), and lenders (e.g. American Library Association), has formed in response to the threat to their (and our) livelihoods posed by the growing restrictions on First Sale doctrine. Notably, the group is trying to draw attention to the Kirtsaeng case that is about to be argued before the Supreme Court. Members of the coalition (such as the ALA) have filed amici briefs in the case
However, the group believes that no matter which way SCOTUS rules in this case, the action is next going to move to Congress, as the losing side will want to get legislation turning things back in their favor. Thus the group is going to focus on "advocacy" which I hear as "lobbying Congress".
The press conference featured half a dozen spokespeople for major members of the initiative, each giving a short statement of support and then taking questions from the call-in audience, most of whom appeared to be members of the press (and people like me, who fake it well). Generally the poitns made were things that Copyfight readers will be familiar with: Kirtsaeng is a case that could significantly curtail First Sale rights for people in the US by taking those rights away from products manufactured overseas. Aside from being an invitation to every manufacturer to shift their production outside the US, this would be a tremendous burden on reselling and lending institutions such as eBay, Overstock, and libraries of all sizes. In my talk to the New England Library Association I spent a bit of time trying to educate those mostly smaller-scale librarians about the dangers of this case. I found it interesting to note that the Seattle library system estimates that over 50% of its collection of printed materials (including English- and foreign-language volumes) was printed abroad. That's probably not an unrealistic yardstick, so just try to imagine that half your local library's lendable materials vanish off the shelves overnight. Yeah, that's a big problem.
ORI also seems to be focused a bit much (too much, in my view) on physical materials. The gentleman from Overstock noted with alarm that Kirtsaeng would lead to manufacturers segmenting their products by region or country and that this would mean you couldn't buy certain non-US goods in the US. Hunh, I thought to myself, isn't that what region encoding already does for DVDs? What, I wanted to know, was the big deal about that? Unfortunately, I think I mis-phrased the question to him as he kind of flubbed the answer.
I was also slightly disappointed by repeated references in the panel to "clever lawyering" as being responsible for the current situation. I've read the Second Circuit's decision and it seems a reasonable application of the law as written. If you don't like the law as written, blame Congress not the lawyers. Congress, whom the ORI hopes will fix this mess, is also full of clever lawyers. So less blame and more comprehension next time, please.
I should also note that ORI isn't alone in taking this approach. I've been getting pings from YouveBeenOwned (whose site appears to be slashdotted as I write this). This offshoot of the liberal Internet activism group Demand Progress went live in June of this year with a campaign against Kirstaeng and other things like TPP - the Trans-Pacific Partnership - that also threaten consumer rights in the US. If they can ever keep their Web site going they appear to be planning a public demonstration in DC on Monday, the day before SCOTUS hears arguments in Kirtsaeng.
In CLS Bank v. Alice Corp the Court will have to decide the relationship between the implementation of a process in a computer (program) and the abstractness of that process. In Ultramercial v. Hulu the issue again is whether taking a process that is abstract and putting it into a computer program somehow makes it non-abstract.
In both cases the EFF is arguing that encoding an abstract process into a computer program doesn't automatically make it non-abstract. This sounds good on the face of it, but it has two major problems - neither of which is really the EFF's fault. Problem one is the question of what is "abstract." The common-sense notion of abstract is a fine one, but in order to rule on a matter of law what's needed is either a definition in the law (missing) or a definition in a precedential court case (missing and/or confused). In order for the Federal Circuit to be able to make reasonable sense of these cases, we're going to need a workable, legally binding agreement as to what "abstract" means in the sense of patents on processes.
The second problem is one I referred to when I criticized the EFF's patent-reform efforts this past summer: focusing on software is misguided. I continue to believe that a fundamental principle underlying all of computer science is that anything that can be done in a program (software) can be done in a machine (hardware). Therefore, the critique of these cases cannot be simply that "turning them into a program does not make them non-abstract." You must logically also say that "turning them into a machine does not make them non-abstract."
And if you say that creating a machine that follows a process is not patentable then you have a serious problem that loops back around to our first point: how is this not making something non-abstract? Isn't a machine the Platonic ideal of a non-abstract thing? And how are we to differentiate one set of steps (process) taken by a machine from another set of steps taken by a different machine in such a way that we could say one machine was performing an abstract idea and one was not?
It's this sort of reasoning that leads people like Greg Aharonian (of PATNEWS) to argue that the entire notion of abstract is undefinable - he would say "nonsense" - and thus should be removed from the laws entirely. Unfortunately, the CAFC can't rewrite the law and Congress is extremely unlikely to do so, which means we may be stuck trying to untangle this knot for some time to come. Paging Alexander the Great!
I've been going on about e-book evils a good bit lately, but they do have undeniable appeal. As someone remarked to me privately, you can torrent down today more e-books than you could read in the remainder of your lifetime, no matter how old you are, and carry them around on a piece of hardware smaller than your thumb. Try doing that with physical books. Touche'.
Joel Johnson, it seems, would like at least for vendors of goods like e-books (that you don't actually own) to be required to tell you that you're not actually "buying" the thing when you click that button that says "buy." That seems a thin solace for the mess we're currently in, but at least one can hope that giving it some more attention will lead to more ideas. Maybe, as Gizmodo suggests in the image it put with Johnson's story, every iPad and Kindle should come with a big "OPP" label.
I wanted to take a separate blog entry to talk about HathiTrust. This is related to the previous entry about Google Books, in that the actual case in question was not a suit against Google itself, but was instead the case known as Authors Guild v. HathiTrust.
HathiTrust is the online resource formed by several libraries to hold the digital editions of books created from Google's scanning. HathiTrust uses these scanned book copies in several ways, including allowing searches against them and providing the electronic sources to vision-impaired users who can't access the printed copies. HathiTrust does not pay anyone for rights to do this and the question that Judge Baer ruled on was really the question of whether or not what HathiTrust is doing is fair use. Of course, this has significant implications for Google, which also makes scanned digital text copies searchable and readable, but Google was not formally a defendant in this case.
The case (PDF link) is a little complicated because the Court had to deal with other matters such as whether a state university enjoyed 11th Amendment immunity and what scope of possible copyright violations could be the subject of the suit. GSU has tried to self-police via a "Fair Use" policy that requires professors who want to make electronic elements available to justify their use of the copyrighted material on fair use grounds. The court generally upheld that approach, though it did put limits on what percentage of a book could be offered fairly by the library. In addition, the judge appears to have given the publishers an "out" in that if they were themselves to offer a reasonably priced excerpting service online that might preempt what libraries are now doing. However, in the absence of such things (or a reversal on appeal) this one is marked as a win for libraries that want to do a limited form of e-lending in support of research and class materials.
The third case that Kolowich notes as related came last year. In Association for Information Media and Equipment v University of California (PDF link) a U.S. District Court Judge appeared to buy UC's argument that a library streaming video off a secure server to authorized users, not the general public, was fair-use equivalent to showing that same video in a classroom. Since UC had an agreement that permitted showing the DVDs in an educational context, the judge reasoned that it didn't matter whether the students were sitting in the same physical classroom or in distributed virtual classrooms - the use of the stream was still part of the educational agreement and thus permitted.
As Kolowich notes, the suit was actually dismissed on technical grounds and so there isn't a standing ruling on the fair use issues, and there are certainly many more fair use practices that HathiTrust are going to have to navigate. But still, it's looking like a winning year for the Trust and other library/educational users.
Of course, that may change with Kirtsaeng about which more tomorrow.
This suit has been going on forEVER (at least seven years) and I'm at least technically party to a possible settlement as an author so I haven't had much to say about it, but this month there have been two major developments that are worth tracking. Plus I'm hopeful my new librarian readers are paying attention because this one matters to you guys, too.
To review: Google announced in 2004 a major initiative to scan a lot of books. There was a considerable debate about which ones it could scan - things out of copyright are obviously fair game but that's a vanishingly small sample of the literature. Most controversial were plans to scan so-called "orphan" works: out-of-print items still under copyright but whose copyright owners could not be located. Also controversial were Google's plans to be the exclusive repository of the scanned material, in effect building a digital wall around what might be thought of as public-domain material.
Major organizations objected, publishers objected, attorneys general had significant questions, and as usual it all dragged out in court. There have been some attempts to engineer a comprehensive settlement, none of which have held on. The most recent one was last year, and that got thrown out as vastly unfair and likely to give Google a ridiculous monopoly and would have instituted whole new powers for Google, such as the ability to sell copies of these scanned books.
Fast forward to this month, when Google managed to split its enemies, or close one front in the war, depending on how you look at it. They settled with the big five publishing houses. Since this part of the suit isn't public - it's corporations agreeing on things - the precise terms aren't required to be shown publicly. Most notably as a private agreement it lets Google and the publishers get around the requirement for a judge's approval and avoid getting torpedoed again for selling things they don't have rights to sell... oh, wait, was that my out-loud voice?
Some details have appeared in news stories, and the Association of American Publishers put out a press release: Google agrees that publishers may require that their books and journals be removed from the archive. Publishers who do leave their materials in the archive get a digital copy for their own use (avoiding the costs of digitization themselves) and can use that copy for whatever they want, including presumably selling it. Likewise, Google gets rights to sell the material in its "Play" store, giving publishers some of that revenue, and is allowed to make 20% of the digital edition readable on-line.
Not mentioned is what efforts (if any) will be made to determine that either Google or the publisher has digital sale rights to these publications. Recent decades' contracts have usually assigned digital edition rights to publishers, but that leaves a great deal of material from the last century that is both under copyright and for which no digital reproduction rights were ever negotiated. Just because something is out of print doesn't mean it's out of copyright, a fact that both Google and the publishers seem all too happy to gloss over.
The second win for Google this month came against its remaining opponent, the Author's Guild, which has been pushing a class-action case on behalf of author-members as well as other authors such as those who wrote those out-of-print-but-not-out-of-copyright books. In a ruling earlier this month, Google's practice of scanning these out-of-print books for inclusion in its search archive was found to be a form of fair use. In specific, libraries that had given Google copies of books to be scanned were held not to be in violation of the copyrights on those books.
Interestingly, the decision by Judge Harold Baer is based on a full fair-use analysis. Baer reasoned that inclusion of the works in a searchable archive was sufficiently "transformative" and that inclusion of the resulting digital copies in the Hathitrust Digital Library did not impair the market for digital editions of the books produced by the publishers. (I'll have more to say about Hathitrust in the next blog entry.)
This is Happening Right Now: Amazon DRM-nukes a Customer
This link is going viral in the spaces I inhabit right now. Short form: an innocent woman has her account closed and her (paid-for) collection of Kindle e-books nuked with no warning and no explanation by Amazon UK. This is, as the blurb says, DRM gone insane. I did tell you that e-books suck, right? As I write, the link has appeared on popular blogs including our friends at Boingboing and people are starting to post copies of the WTF letters they've written to Amazon. I anticipate we'll see an apology and retraction by tomorrow AM, which will be great for the individual woman but still leave all the rest of you e-book readers hanging by the same thread.
Whether you read the book or the V.C. posts, I also recommend you read McArdle's response in The Daily Beast. In her column she takes issue with the core argument that experiences with low-IP industries are comparable to, or can serve as any guide for, high-IP industries. Her key point is that in the low-IP industries, copies are generally inferior in quality whereas in digital industries copies are perfect. Also, digital copies are far easier to mass-produce than copies of physical objects like clothes.
Sadly, while I agree with her major theses, I think she then goes off the deep end. For example, she believes that a low-IP model would "impl[y] the end of drug discovery." That's just grossly overstated, and ignores several things. One is the option of using much-cheaper small-scale discovery steps, which I discussed back in 2011. It's possible that a low-IP model won't ensure drug-company profits on a multi-billion-dollar pipeline that produces one blockbuster drug every few years, but why should that business model be sacred?
Second, it ignores the "Advil effect." Briefly put, the effect is this: Advil was only patent-protected against generics for two years, and that was over 20 years ago. Despite that, brand-name Advil still controls over 50% of the market for ibuprofen. That is at least prima facie evidence that lifelong patent exclusivity isn't required for a drug to be successful across decades.
Her discussion of the music business is even worse, being at best anecdotal and in places outright insulting. For example, she bemoans the (implied if IP protection is weakened) death of blockbuster-producing major label acts. Excuse me if I don't cry a river over the removal of corporate manufactured acts from the airwaves, hopefully clearing the way for some of the hundreds of thousands of hard-working non-major-label musicians to get airplay. McArdle's phrase "low-productivity artisinal profit model" almost made me snarf. Imagine the reaction of, say, Amanda Palmer to being told she is "low-productivity".
Again, McArdle enshrines the current business models as sacrosanct. Palmer may sell 1/10th the number of units of someone who gets pushed to the front racks at Wal-Mart, but so what? If those front racks disappeared entirely would we be any worse off? There's no quality difference I can discern in the disc I got from Ms. Palmer through Kickstarter compared to the disc produced by a major-label factory. And if I'm getting a quality product and am a satisfied customer/fan, isn't that the point? I don't require a Big Corporate Seal of Imprimatur in order to hear good music and I see no reason why intellectual property regimes should privilege BCSI over AFP who, it should be noted, offered the entire album as a digital download with no DRM for $1.
By the end McArdle softens her critique somewhat. She admits that her points are "not necessarily arguments against looser IP". Well, yeah. That's sort of a shame, as I think there are some core things to be said about reproduction fidelity and relative cost in response to Raustiala and Sprigman. Maybe once I've dug myself out of this backlog I will return to the topic, if I have anything new to say.
First, the good folk at TechCrunch pointed me to their (glowing) review of the new Boxee TV. This product, as the story illustrates, is aimed squarely at the new generation of cord-cuttters. People who want their television a la carte, in the cloud, and available on any device. Record multiple channels at one time? Sure. Unlimited storage? Sure. Have the latest from streaming providers like Netflix? Sure.
If the damned thing didn't cost so much I'd order one for myself today. The per-month price tag is hefty and would significantly cut into the savings I'm enjoying from cancelling my cable TV. But prices always come down and I can wait.
What's most interesting to me, looking at this from a business perspective. is that I don't see Boxee offering anything that the major cable providers could not have offered. The only reason they can't (didn't) is that they are still locked into that tie-down, cord-from-the-wall, one-device (ours) etc model. It's all about control for them.
Which brings me to the second item: a notice that the FCC is finally going to allow cable companies to scramble basic channels, although they're going to have to bend over backward to accommodate for a couple years. These basic channels are the ones that are usually broadcast over the air - free, you may recall - that cable companies first howled about being forced to carry, and then tried desperately to control. Scrambling the signals is just one more sign that the cable companies remain mired in the 1990s, clawing for every single bit of control they can get. Heaven forbid someone should see television channels for free! I have no words.
Chris Welch's story is deliciously ironic, opening with the sentence
The days of plugging a TV into the wall and getting cable are coming to an end.
You got that right, Chris, and sooner than people think.
Let's start with the facts: the patent (#8,286,236 in case you want to look it up) is for a copy-blocking system (DRM) for (some) files used by (some) 3D printers. It will no more "prevent 3-D printer piracy" (by which they mean the use of a 3D printer to create an object that might have IP protections) than any other DRM system has prevented copying. Which is to say, not at all.
The article is full of misstatements such as "you can’t generally copyright objects (exceptions include sculptures and architecture). That’s because copyright applies to creative works but not to 'useful articles.'" Like, say, books? Useful objects, those books. Also, copyrighted. So the article misunderstands what DRM does, misunderstands basic intellectual property concepts, and generally is sub-par.
That aside, what of the patent? The patent works like every other DRM system - you load a file into a DRM-encumbered machine, which checks that "an authorization code" (in the words of the patent) is available allowing you to load this file on this machine to produce some object. That's not a horribly stupid way of stopping people stealing your shape files and making unauthorized use of them - again, just like every other DRM system in existence. But it has jack-all nothing to do with the reproduction of IP-protected objects.
I could just run that file on a machine that doesn't bother to check for the code, or that has a simple resistor soldered in place to ensure that it thinks it has the code for every file. Or I could just take a copy of the file with the DRM stripped out and use that. Or I could make my own file that produces the object in question. Or, or or. I'm sure anyone with more than five minutes to think about it could vastly expand that list of ways this patent is irrelevant to any real problem.
The patent itself has significant problems. Greg Aharonian (of PATNEWS) sent out a mailing earlier this week in which he cited a major government publication that anticipates this patent by five years, as well as several easily-found patents that involve uncited prior art. Just search the US Patent database for patents containing the words "print" (or "printing") and "rights management." I'm sure you'll find the same patents Greg found. Technically, those patents talk about 2D printers, but the problems and solutions they discuss are nearly concept-for-concept identical with this one.
There remain significant problems with how to handle intellectual property protections in a world where anyone can duplicate objects more or less the way we can photocopy book pages. But this patent and article aren't contributing to the discussion.
A Copyfight reader responded to yesterday's story about Bowman v Monsanto to say that he believes SCOTUS will reverse in this case. The reason is that unlike Circuit courts, which can disagree with each other on a matter that SCOTUS must then settle, the Court of Appeals for the Federal Circuit (CAFC) is the binding decision body for patent matters. Its decisions have precedential weight; therefore, if SCOTUS simply wanted to affirm that CAFC was right in this case there was no reason to grant cert. Since they took the case, ipso facto, one is led to believe they intend to reverse. That may still not happen since only 4 Justices' votes are needed to grant cert and 5 votes are needed for a majority, but it's the way this reader is betting.
In another case that is potentially hugely important but flying mostly under everyone's radar, SCOTUS has agreed to hear one 74-year-old farmer's challenge to the biggest of the big in agribiz. Like the other stealth IP case this term (Kirtsaeng) part of the question at issue here is what constitutes "exhaustion", though in this case it's a patent that is being fought over. As usual let's start at the beginning.
Monsanto makes (among many other things) a patent-protected line of soybean seeds generally known by the phrase "Roundup Ready". These seeds are genetically modified to be resistant to Monsanto's popular Roundup herbicide, allowing farmers to plant and spray without fear that they'll kill off their own crops as they exterminate weeds. This combination has been very popular - so much so that over 90% of the commercially planted soybean crop (in the US) is Roundup Ready. But plants are not like other products in that they're self-replicating. A patented seed produces a plant that in turn produces... well, seeds, and the modification Monsanto made is passed down through generations so the seeds are also resistant. Allowing the re-use of those seeds would give farmers the ability to benefit repeatedly from Monsanto's patented innovation without paying (again) for it.
Monsanto therefore requires farmers who want to plant its seeds to sign an agreement saying they won't re-plant the seeds but instead will buy new seeds from Monsanto each planting. Bowman, the farmer in this case, realized that because Roundup Ready-derived seeds were so common he could just buy some local generic soybean seeds and be pretty sure the majority of them would contain the herbicide-resistant mutation. Of course, this is also much cheaper. So he did that, and Monsanto accused him of violating its patent; Bowman counter-argued that his use of the generic seeds was fair because of patenting's exhaustion doctrine.
The exhaustion doctrine says (more or less) that you can only sell a patented product once. As Timothy Lee notes in the linked story above, SCOTUS has already said that exhaustion applies in the case where you use a patented product inside something you sell - in the case of a patented chip sold on its own and then re-sold as part of an OEM computer. Bowman reasoned that since he had not violated his license - he replanted generic seeds, not the ones grown by the plants he signed for - then exhaustion would apply and the generic soybean seeds would be OK.
As Bloomberg notes, this is a potential bombshell for the genetic-seed industry. If they are forced to play by the rules that chipmakers and others have to play by then they'll have to change their entire business models. Given the degree to which Monsanto dominates the business you can see why they'd be reluctant to do that. Conversely, it seems contrary to ordinary sense to say that the simple act of planting a seed may be a patent violation. Dan Charles noted for NPR earlier this week that the trial judge was troubled by the basic issue: is the reach of gene patenting so long that a single company should be allowed to encumber an entire generic market?
I'm frankly baffled by why SCOTUS agreed to hear this case rather than letting the CAFC decision stand. And given the way that the Court's recent Mayo decision sowed (sorry, I couldn't resist that one either) confusion rather than giving clarity I'm afraid that a decision here will similarly muddy the waters further.
Part of Posner's theoretical framework is a critique, often based on economics, of patent and copyright protection. This is the substance of his September 30th column - a cost-benefit test for patent protection. Sadly he picks pharmaceuticals as his poster child, which shows off the bat just how bare a simple means test is for judging patent suitability, As I've argued in the past, the drugs marketplace involves special considerations that weigh against a needs-blind market analysis.
Posner's main point is that the software industry is presently overprotected by patents because software is cheap to make. This seems a little odd on the face of it - presumably if I run a large software development project that goes for many years and has huge cost overruns (i.e. any government software procurement) then that is more worthy of patent protection than a mobile app that's written over the course of a few months by a talented three-person team. This is the sort of argument economists make which tend to leave the rest of us scratching our heads in puzzlement. I understand that it accords with a theory that says "things that are more expensive to make need more protection" but when the theory leads to (dare I use this word) patently absurd results isn't it time to re-examine the theory?
Posner also that software patenting suffers from "a shortage of patent examiners with the requisite technical skills" - true, but also probably true for many other fields of cutting-edge technical innovation. Are there really more and better-skilled microbiology examiners? Or carbon-fiber materials processing examiners? I have no data, but tend to doubt it. There are indeed problems with software patenting, as I've written about before but these ain't it.
His discussion of copyright protection seems better. He notes that fair use is getting short shrift (but see my upcoming piece) and that copyright terms are too long. Most of all, he notes that copyright violation action requires showing of some willful infringement whereas you can infringe a patent you've never heard of, simply by going about your normal business. That alone is a significant impediment to software business and could stand some public discussion. Creation of only token penalties for accidental infringement is right up there with mandatory licensing on my "how to improve patenting" wish-list.
Sadly, Posner doesn't take any specific stand on the reforms he thinks are needed, just calling for Congress and the courts to devote "serious attention" to the problem. Right after they get done devoting "serious attention" to the budget deficit, one presumes. And prays.
Sometimes the lede is just so perfect I can't improve on it. Therefore: The Pirate Bay has made an important change to its infrastructure. The world’s most famous BitTorrent site has switched its entire operation to the cloud. From now on The Pirate Bay will serve its users from several cloud hosting providers scattered around the world. The move will cut costs, ensure better uptime, and make the site virtually invulnerable to police raids — all while keeping user data secure. (h/t +Rob Malda for the original pointer)
In the past we've talked about the reach of copyright; for example, to facial tattoos. We haven't (largely due to my own ignorance) talked much about how far trademarks can go.
In the general public there's only a vague awareness of trademarks, usually because of famous cases. Xerox-the-company saw their tradmarked name become used as a generic term for photocopying, for example. And lately it's become fashionable to call all portable digital music players "iPods", which I'm sure Apple's trademark people don't care for.
The column's author, Michael Dorf, seems to be taking both sides in the case. On the one hand, he agrees that the 2nd correctly applied the Lanham act in granting the trademark; on the other, he expresses concern that this is part of a larger trend toward overbroad IP protectionism. Generally I agree with that sentiment but in this case I think Dorf is overreaching.
His point is that he agrees with the District court, which originally ruled that trademark was not appropriate because trademarks don't protect functional element. The reasoning that in fashion, "...color is usually a vital element of the aesthetic appeal of a product, which is at the core of its function" seems excessively tortured to me. The logical consequent of that would seem to be that if your function is aesthetics (which is to say, fashion, show, entertainment, etc) then you lose all ability to trademark your distinctive visual elements. And that's going too far for me.
Yeah, that had my eyebrows going up, too. However, Reid isn't writing this stuff from an outsider perspective. In past lives he's been an entrepreneur and had a hand in the founding of listen.com which eventually led to Rhapsody - an online music service that is still operating (albeit in different form) today. Reid has also gotten some notice for his TED talk titled "The $8 Billion iPod" In this talk Reid lambastes the Cartel for its massively out of proportion sense of its own self-worth.
If anyone has read the book (or listened to the audio, read by John Hodgman, which is getting good reviews) please drop a comment and tell us what you thought of it.
Raustiala and Sprigman are co-authors of a new book, The Knockoff Economy: How Imitation Sparks Innovation. Here's the teaser blurb:
Conventional wisdom holds that copying kills creativity, and that laws that protect against copies are essential to innovation–and economic success. But are copyrights and patents always necessary? In The Knockoff Economy, Kal Raustiala and Christopher Sprigman provocatively argue that creativity can not only survive in the face of copying, but can thrive.
Needless to say that's right up our alley. I'm not sure how much of this I'll be able to report on, so get it from the source if you can.
I've been trying to write this story for a while and stuff keeps popping up. I'm going to focus on three related posts, all of which illuminate different corners of the current (problematic) business model for online streaming music. The core questions are: who gets paid for this and how sustainable is it.
Here "broken" means "can't ever possibly make money." The model advertises free-to-listen streams for US consumers (good for us) while the company has to pay server and bandwidth costs as well as those high US royalty rates (bad for them, and ultimately bad for people who like Spotify). Sandoval's story notes that Spotify is still a private company and thus not required to publish numbers, but it has agreed that the numbers posted by PrivCo are generally correct.
Spotify's strategy appears to be to absorb the losses (covered by venture financing) while it builds market share and audience size, then find a way to make money off that large audience. One way to do that is through subscription fees and you can see that the #2 comment on Sandoval's story (at least when I wrote this) is someone asking Spotify to raise subscription fees. In other words, there are real people out there who are really willing to open up their wallets and pay for a service they love. Shocking, innit?
Currently it appears that services are converging around a number like $10/month in fees, with a wide array of discounts and premium/freemium models being tested. I think, given the cacophony (you see what I did there?) of subscription models still being tested it's premature to write off Spotify or any other service just yet.
In order to survive, streaming services need not just to satisfy the Cartel with its royalty structures, but they also need to keep artists happy. For some time there has been muttering that streaming services aren't returning (enough) money to the artists and some artists have chosen to keep their latest hits off the streaming services. Two articles address this point head on: First, AP reports that the RDIO service will be paying artists $10 per new subscriber. Rdio is definitely playing catch-up in this business against the bigger names like Spotify and is hoping that artists will sign on to the program, create pages on the Rdio service that fans will find, and then lead the fans through the sign-up, for which artists will get direct revenue. Adding subscribers is a significant cost for these services and some kinds of affiliate-style programs make sense.
However, this doesn't address the deeper question of how stream revenue flows to artists. Pandora's take on this question hit their blog earlier this week. Stacking up real (if lesser-known) names, and actual revenue numbers, Pandora founder Tim Westergren shows how much money is flowing from the streaming service to artists.
In addition, he's not shy about pointing the finger directly at the RIAA and blaming them for artists not getting more money. As we've seen, the RIAA isn't shy about setting high fees for streaming music, and isn't shy about keeping those fees for itself. Westergren's points include the claim (sadly using awful marketing studies to back himself up) that streaming services have contributed to the decline of music piracy while the supposed anti-piracy RIAA continues to hoard the revenue that's being generated.
There's a lot more to say about this business and its models for survival, but this is a good set of places to start.
Our friends at the Future of Music Coalition (FOMC) sent out a reminder that their annual Summit is happening next month (November 13th). This will be their 11th annual conference and this year it's free to attend. In addition it'll be streamed live online for free.
In this case the villain is Microsoft, but you can find hundreds of similar instancse going back to the earliest days of the DMCA, and the story is always the same: $player sends thousands of takedown notices for material in which it claims copyright. The recipient takes down the material and may or may not notify $targets that their stuff is no longer visible. If $target is a big entity with lawyers and money it can usually get its stuff back online, quickly. If $target is you or me, we are (as my kids like to say) ood-scray.
In this case Microsoft clearly went bananas, targeting its own search engine Bing along with other things. But the specifics aren't the point here - the point is that the automated spewing of these notices is now routine and widespread practices and there are no requirements that $player emit only reasonable notices, or are there any penalties for failing to do so. I still think that the DMCA Safe Harbor idea is a sound one, but it clearly needs additional regulatory strength to curb abuses and stop companies controlling online speech.
Free speech (in the US, First Amendment) claims are somewhat tangential to Copyfight interests, but it's still important to understand how courts interpret things. First of all, you don't have First Amendment rights with regard to private interests, such as the corporations that make up the Copyright Cartel. Against a government you may, and lots of people assert that the government can't restrict speech. Entities that are publicly funded, such as libraries or public parks, usually have to follow the same restrictions as governments themselves.
In fact, courts have held that governments may restrict speech, but only under certain conditions. Among the most important of those are that the restriction must be viewpoint-neutral; that is, they can't restrict some speech and allow other speech based on the point of view expressed, though there are exceptions even here, for things like sedition and credible threats. And a government entity that wishes to restrict speech must tailor its restrictions as narrowly as possible, in order to serve (what the court recognizes as) legitimate interests such as maintaining public safety.
Cory Doctorow's announcement that he is direct-selling the (professionally done) audiobook version of his recent Pirate Cinema reminds us that one of the big problems with mainstream online retail outlets (*cough*Amazon*cough*iTunes*cough*Audible*cough*) is that they all refuse to carry DRM-free titles. Even though the publisher (in this case Random House Audio) is perfectly willing to make the high-quality title and wants it sold, the retailers are blocking it. Get a freaking clue, already, guys.
Unless you're superhuman or very young and medical science advances faster than I think it will, at some point in your life you're going to lose some or all of your sight. I'm 50 and for the last decade I've been noticing significant degradation in my vision. I do that "old guy" thing of pushing my glasses up and holding small print really close to my nose so I can make it out. The fine control muscles in and around my eyes have lost a lot of their strength and flexibility with age.
The good news is that there are an ever-increasing number of devices and software to help with this; the bad news is that DRM screws up almost all of them. This is detailed in heartbreaking depth by Rupert Goodwins on ZDNet in the third part of his essay series. (The essay links you back to parts 1 and 2.) Goodwins particularly calls down a plague upon the house of Adobe but notes many others share blame. And he describes how he, like so many people who are generally law-abiding but want access to their paid-for content, is reduced to petty crime simply because he loves to read.
I will be speaking at two events in the near future.
October 15th I'll be part of the New England Library Association's annual conference, a three-day affair that will be in Sturbridge MA this year. I've been invited to talk on the topic of e-books and libraries and I've tentatively titled my spiel "Why E-Books Suck (unless your name is Amazon)".
Arisia will once again be MLK weekend in January (18-21) and there will be a couple of panels on intellectual property. Topics and panelists aren't final yet - I'll update once I know for sure. I know that a couple of my co-panelists from previous years are planning to return this year and we're hoping to have some discussions focused on IP and creative folk (e.g. authors and artists).
Enter now Ralph Oman, who was previously Register of Copyrights. Mr Oman has now filed an amicus brief in the Aero case, in which he argues that he is batshit insane. No, wait, that's what techdirt is saying; what Oman is saying is that all new technologies should have to go get Congressional approval in order to exist. Upsetting an existing business model is not allowed, unless Congress first says it's allowed. Or so Oman appears to be arguing:
Indisputably, Congress drafted the Copyright Act to prevent the creative efforts of authors from being usurped by new technologies. That core principle is at the heart of the Copyright Act. Congressional intent would be undercut by any decision that would sanction the use of technologies which could be used indirectly to undermine its goals.
I just... I don't even... what the ever-loving grace have you been smoking, mate? (h/t Boingboing for the original pointer)
In a direct blow to Amazon, Wal-Mart has announced that it will stop carrying all models of the Kindle e-book reader. Significantly, the chains (Wal-Mart and Sam's Club) are still going to carry iPads and Nooks, making clear that this is not a move about e-book readers so much as it is a move against Amazon and the inroads Amazon is making against retail marketers everywhere. To be honest, I wouldn't be surprised if they also dropped Nook though its impact on their bottom line is minuscule when compared to Amazon's.
Back in May I noted that Target was going to drop Kindles from its retail shelves; I'm just surprised that it took Wal-Mart this long to follow suit. It's pretty clear that any retailer that maintains a physical store presence is going to be forced to take some kind of stand with respect to Amazon. And I expect that the majority are going to line up against them. Amazon hasn't done anything to win friends in the retail space and has cut into pretty much every brick-and-mortar retailer's turf in some way or another.
E-books are particularly tricky here in that they're always going to be bought on-line; you just won't go to a store in order to buy an e-book in today's environment. (*) However, Amazon presents e-books as part of its buying ecosystem and many aspects of that system compete directly with Wal-Mart's merchandise lines. Thus e-books are a competitive hook that retailers need to be careful about.
(*) As a brief aside, if I was running a retail book business I would be trying to get people into my stores to buy e-books. Set up an author talk, get people to bring their readers, and get a code for a discounted e-book. Arrange with the publishers to get a few points back on any sale where someone enters one of the codes. Heck, I'd even sell them readers at the event, with a free card to my store's book-purchasing club/loyalty program. But I digress.
As Jones tells it, theft is rife among magicians. They copy each others' tricks and sometimes outright 'steal' a performance piece. In this case a magician performing as Gerard Bakardy appeared to have stolen - in the sense of copied and performed in an altered form - one of Teller's signature tricks. The signature trick was the subject of a 1983 copyright registration that Teller made, in an effort to protect not the trick itself, but the performance art wrapped around the trick. Teller willingly reveals that he has used at least three different methods to do the trick in dispute - but the method is not what the audience cares about. The audience cares about a performance, and Teller is asserting that his performance (of the trick) is a unique artistic creation, as worthy of legal protection as any other act of artistry.
According to Jones, Teller has in the past relied on professional courtesy when confronted with other magicians who have lifted his tricks, rather than legal protections. In this case, however, Bakardy was not just performing the trick, but offering to sell its secrets to anyone who would meet his price. Also, Bakardy was unwilling to extend professional courtesy. When Teller contacted him, the story goes that Bakardy asked for more money and favors than Teller was willing to pay.
Intellectual property protection for something like the performance of a trick is a difficult thing - to begin with most performers don't have the money to pursue a court case against someone who has lifted the trick and even if they do the case itself will be public which may end up revealing secrets the magician would rather didn't get into wide circulation. As a result legal protections such as Teller's copyright may not be worth the paper they're printed on. Nevertheless, Teller sued... and Bakardy vanished. No one has even been able to serve him with proper notice of the lawsuit, though Teller got permission to serve notice by email (which has gone unanswered).
Whether Teller's copyright protection will stand up in court is a mystery yet to be revealed.
To begin with, you should know that Phipps is himself a strong proponent of open source development (his column is called "Open Sources", for example) and a recent opponent of software patents in part because they interfere with open-source development. So when he says there might be something good in the legislation we already have around software patenting my eyebrows tend to go up.
According to Phipps, the working paper titled "Software Patents and the Return of Functional Claiming" from Lemley (SSRN link here) will propose that the problem with software patents is what lawyers tend to call "claim construction." That is, the problem is not with what's being patented (software) but with the things to which the patent is supposed to grant a monopoly. Badly constructed (overbroad) claims attempt to protect not the (software) machine, nor the steps (algorithm) it performs but the result of executing those steps on that machine - the goal.
Lemley's argument (and I haven't read the paper yet, so take this for what it's worth) is that the USPTO is not correctly applying the already existing Patent Act of 1952 and if in fact the Office would do that, then it would reject these patents with overbroad claims, or at least force patent applicants to redraw their claims more narrowly. That wouldn't immediately solve everything, not least of which are the ongoing problems with disgracefully shoddy lack of prior art inclusion in software patents and the pervasive confusion over sections 101 vs 103 of the law. But it would be a huge step forward.
One final caveat to keep in mind here: Lemley's thesis is in a "working paper". That means it hasn't yet been subjected to the kinds of critical review that more formal publication might require. I suspect we'll see people who believe that Lemley is misinterpreting the 1952 Act. Still, it's a blessing to have fresh ideas for improving the situation, particularly ideas that don't require radical reforms or rafts of new legislation.
Observant e-book buyers have mailed to let me know that some of the effects of the e-book price-fixing settlement are starting to be seen. When you buy e-books now in some online stores (notably Amazon) you can see text stating that the book's price is "set by the publisher" or "sold by $publishername." Other e-books, from companies that signed the settlement, are starting to come down in price as well. If you see something interesting in this space do drop me a note.
Over at Boingboing, Cory Doctorow has a long paean of admiration for David Byrne's new book "How Music Works." Like me, Doctorow is a fan of Byrne's thinking as much as his music. The review describes the book's breadth and depth and positively glows with admiration for the insights Byrne has accumulated over his career, with respect to such issues as how physical spaces and production formats can have gigantic impacts on the artistry that gets produced.
I confess that I had not planned to read this book soon, having added it to my holiday wishlist. Perhaps I'll have to revise that plan.
WIRED offers up an amusing Wargames-themed info-graphic mapping the current patent war between Apple and various proxies for Google (Motorola and Samsung primarily). Click on a country to get a pithy summary of what each player has going in the current situation, but realize that the main event has yet to start. And when it does we are all going to be sadder and sorrier.
To understand why this is A Big Deal, let me back up a couple steps. First, everyone agrees that piracy in gaming is a huge problem. Game publishers hate having their titles pirated - it's bad on all platforms but apparently worst on PCs. Pirated titles mean people just don't pay for games and people who didn't pay end up consuming resources such as server space and bandwidth that is supposed to be paid for by those game sales. Honest players also hate game pirates - who likes feeling like the other guy got away with something when you were an honest customer? In addition, online gaming can be hurt by people who pirate games because some who play by the rules end up competing with (and usually losing to) people who have pirated/cracked games and can use that to cheat.
Unfortunately, gaming companies - particularly big names such as Blizzard and Ubisoft - have responded to piracy threats by introducing more and more restrictions on what their customers can do, usually in the form of DRM. Big-publisher games today often feature what's called "always on" DRM, meaning that your game must constantly authenticate itself with the company's servers. It's not enough just to type in a CD key or other one-time validation anymore. And players hate this. Boy oh boy do they hate it. But even when they hate it, games with always-on DRM can still be big successes. Blizzard's recent Diablo 3 title has made millions even though it requires a constant live connection to a server even if the player is operating solo. No server, no game, even though you think you bought and own that copy of Diablo 3. Blizzard is no doubt crying all the way to the bank.
So when a big-name publisher - in this case Ubisoft - backs away from always-on DRM, it's huge news. And in the course of getting raked over the coals by RPS that's what Ubisoft appears to have done. The interview is full of phrases like "we listened to feedback" and attempts to cast the decision in the best possible light. At the same time, Ubisoft is refusing to release any of the numbers on which it based past decisions, including numbers on title piracy and the supposed anti-piracy effectiveness of always-on DRM.
To be fair, Ubisoft is far from the only company that won't give out numbers in this discussion. And they are not going as far as Macmillan did - Ubisoft games will still require traditional one-time activations and use activation-based DRM, which can limit the number of machines on which you can play a given game. But as RPS say, this is pretty much exactly what (honest) players have been asking for since the whole issue blew up: we don't mind buying the game and are willing to jump through a limited number of hoops to show we're honest. But don't make it overly onerous, because all that does is make honest players long for the easy 'out' that piracy offers.
If you've been with us a very long time, you'll remember this case from back in 2004. Lexmark made printers and ink cartridges and in order to stop people using 3rd-party replacement cartridges they jiggered up a UI that read information from a chip in the (their) ink cartridge. Static Control figured out what signals the printer wanted to get and made its own chipped cartridges that could be used. Lexmark sued, initially under a novel DMCA theory that tried to prevent SC or anyone else from reverse-engineering the printer-cartridge interface. They lost.
Professor Grimmelman shows how the root of these problems is a case commonly called Cablevision, after the company known by that name. In the decision, a specific way of giving customers copies of programs was ruled legal. Unfortunately, the method used to store and supply those copies is what computer geeks like to call "pessimal" - the worst possible way to do something. In this case "worst" means most expensive and least efficient use of resources when looked at from a server/storage/recording/transmission technical point of view. However, a company that is technologically pessimal but legal stays in business where ones that have used more efficient architectures or technical solutions have been found to be in violation of copyright law and precedent, which Grimmelman repeatedly refers to as "demonstrably insane".
In his closing section "The road not taken" Grimmelman makes a plea for us all to get along, and for courts to concern themselves less with legal arcana and more with the function and purpose of the law in the first place, including issues such as fair use that never even got into the Cablevision discussion. Maybe I'm just too jaded, but after two decades of the Copyright Wars I have no hope that sanity will suddenly descend on US copyright regimes.
To be clear, I want to talk about documentary films, often released by major studios. "Real" real life, not reality TV or other obviously scripted stuff. A documentary film that claims to portray events from the real world may soon carry a 'writer' credit, begging the question "who wrote reality?"
According to Tom Roston's piece for the NY Times last week, the idea of a documentary writer is being pushed by the Writer's Guild, a union for writers of film and television. The Guild's actions appear to be worrying some makers of documentaries, who are concerned that the appearance of a writer credit may cause viewers to be concerned about whether this is an actual documentary or the fake kind of 'reality' show that has become so popular in the past couple decades. When you're using a documentary to call attention to an important current, social, or historical issue that can matter a great deal.
On the other hand, life doesn't just manage itself for your camera's convenience. There are creative decisions made, editing done, and often voice-over or narration added. The writers of these latter have long received credit, even on documentaries. But even in the absence of such narration, the Guild wants there to be a writer credit on any film it registers and thus gives its protection/enforcement to. As Roston's piece notes, television documentaries have more often had writer credits. And then there's online, and who's going to get credit there...
I remain committed to the idea that businesses should be able to profit from what they do, including pharmaceutical companies. Bringing a new drug to market is still a multi-million (maybe billion) dollar endeavor - beyond the scope of most charities and even many governments. But we're not talking about hobby items here - medicines developed this way are potentially life-saving and, when full-priced, are often beyond the means of millions of patients who need them to live. This gap has to be bridged, somehow, and drug companies have successfully used IP monopolies (primarily patents) to shut down efforts to bridge it.
All of which brings us back to the central dilemma: companies will need patents (or similar legal mechanisms) to protect their innovations against unauthorized copying, but at the same time they'll have to figure out what to charge. And it looks like Congress may be getting in on the act early this year, as Congresscritters have already written to one manufacturer asking that the medicine be priced "sustainably". Maybe that's the right solution - let companies know that legislators are watching over their shoulders and encourage them to consider how they can recoup costs and make profits over a longer time period, selling more cheaply.
(Full disclosure: Ms. Bosky is a long-time personal friend and like other journalist/bloggers gets paid to write columns for places like About. I don't think she makes money per click but I'm sure her employers are happy when her writings prove popular.)
Julie Hilden has a nice primer up on Justia's IP Law blog on how fair use cases can be reasoned. Using the case of Monge v Maya, in which a panel of the 9th Circuit just overturned a previous decision, Hilden traces the classic four-factor test that is intended to guide courts in determining if a use of copyrighted works is fair. In this case - concerning stolen wedding photos - Hilden walks through how two of the three judges found the factors to weigh against Maya. The fact that the decision was not unanimous, though, shows that these factors are broad and general enough to be subject to different interpretations and weighting and I would expect Maya to ask for an en banc re-hearing.
This is interesting, as previously the lower court had found there was no protection due to the drawings not having the use commonly associated with such drawings. Architectural plans are both expressive and functional - they're intended to allow the construction of buildings, for example, and provide enough detailed information for such functional uses. But in this case the drawings didn't contain enough detail to be used that way. So the question at hand was whether the expressive/artist elements of the drawings were sufficient to merit protection.
This has obvious implications beyond architecture, as many professions produce documents that are intended for functional uses and may also qualify for copyright protection as expressive works. The software industry, for example, produces great quantities of such documents.
David Byrne has been a force in music and on musicians since Talking Heads first broke into the national spotlight decades ago. His collaborations with Eno are often cited as some of the most influential of their time, and he's still rocking out, appearing recently on-stage with Amanda Palmer.
When sourcing Copyfight stories I'm almost always using US or Commonwealth sources (particularly Canadian and UK). That's largely due to my own language deficiencies and the result is a particular set of views on topics.
In this 25-minute segment, Fault Lines' Sebastian Walker focuses on the movie industry, home entertainment, and the copying of movies in particular. The content is not likely to be novel to most readers of this blog and if you're interested in diving more into this let me re-recommend Decherney's book on the topic.
Walker goes into some depth on US legislation aimed at controlling the Internet, particularly SOPA/PIPA and the Web site blackout that appears to have been a key factor in turning back those particular bills. Clay Shirky gives good soundbite, as usual. And then, maybe because it's a source that isn't beholden to US-centric interests, Walker goes on to point out the great hypocrisies of Obama and Hilary Clinton, who utter wonderful worlds about Internet freedom when it's an Arab dictatorship shutting its own people down, but then go right back to supporting restrictive legislation and secret copyright-distorting treaties like ACTA at home.
The emperor has some pretty translucent skivvies on, and US media aren't saying anything about it. I like living in the future, though, where we don't have to depend solely on these media.
Ferguson, best known for his series "Everything is a Remix" and his work on copyright policy in the US, puts the basic idea in front of the TED audience. Unfortunately, although his examples are interesting, the talk is a bit disjointed as he jumps from the notion that creativity is external, not internal, to the ongoing smartphone patent wars, with a very fleeting touch on the notion that the current intellectual "property" regime is hampering creativity. I suppose that's the challenge of trying to cover something this complex in under 10 minutes.
According to Dan Rowinski in the latest ReadWriteWeb/Mobile posting, the reason why Apple has embarked on a world-wide patent war is because they're losing the marketing war, badly. Specifically, it appears that the Apple share of the smartphone market has dropped to just under 17% while Android devices (across all makers) accounts for just over 68%. Samsung, the latest Apple target, accounts for 44% of Android devices. If you can't beat 'em, sue 'em - where have we heard this before?
A new update notice from Google's "Inside Search." is getting notice in the copyfight community. The notice describes a new change in Google's ranking algorithms that will cause pages with "valid copyright removal notices" to appear lower in the rankings. It's an interesting step, and given that it's based on validated notices it's certainly better than basing anything on filed notices. Still, the notice-and-takedown process is far from perfect, particularly for people who want to contest notices, and I hope Google keeps a close eye on how this one plays out.
Amazon has a high-profile role in the crowdfunding space due to it being the main payment hub for Kickstarter projects. Similarly, it had been processing payments for unglue.it, and their withdrawal has forced the site to "suspend all active ungluing campaigns" while it looks for a new payments processor. The Oral Literature project is apparently already through the payments processing stage and will continue, which is good since Amazon is apparently forcing unglue to "void all pending authorizations".
No reason for the decision has been made public but one can speculate. In particular, it's probably not too far-fetched to wonder if Amazon didn't want to be associated with a project that's likely (further) to piss off book publishers, whose relationships with Amazon are testy at best.
Today's Insertcoin column by Paul Tassi over on Forbes talks about a brewing struggle between two heavyweights in the gaming world: Electronic Arts (EA) and Zynga. EA has been in the gaming business forever and has slowly grown into a giant powerhouse by producing its own popular titles and by acquiring popular titles that already existed and often the gaming companies that produced them. Zynga by contrast is a relative newcomer, born in the age of mobile- and browser-based games, and rising to financial success along with Facebook, where it provides gaming to Facebook's millions. By contrast, EA is a much more traditional gaming publisher, placing its titles in retail stores, on download services like Steam, and only recently moving into mobile gaming.
Zynga has been dogged for years by claims that it has stolen (used, borrowed, copied) intellectual property from other games, both in terms of concept/topic and in specific terms such as characters, art style, and so on. People have accused Zynga not of being a game 'developer' but of being a game 'cloner'. But mostly the smaller players haven't had the resources to take their claims all the way; now, finally, someone with very deep pockets (EA and its Maxis studio) are going to court to try and prove it.
Tassi's column is mostly a set of side-by-side images, one taken from a game by a non-Zynga publisher and one from a game put out by Zynga that is accused of being a clone of the original. In an earlier column, Tassi showed side-by-side images of Zynga's recent "The Ville" with EA's "The Sims Social." EA has a lot of time and money invested in its Sims franchise and Sims Social is apparently quite profitable for them. To have that investment threatened by a Zynga clone is not something EA felt it could tolerate.
It will be interesting to watch as this case develops: game IP can include visual design elements, creative process elements such as gamer interactions or component behaviors, and arrangements of elements. These can be covered by trademarks, patents, and copyrights depending on the particular element to be protected. Tassi quotes David Marsh of game maker Nimblebit, which also felt that Zynga had ripped off one of their products:
[W]e were taken aback by [...] how thoroughly Zynga had copied the mechanics of our game, right down to small trivial details that had no effect on the functionality of the game, but got caught up in Zynga’s blanket duplication process.
If EA feels that Zynga has similarly blanket-copied The Sims Social then this could be a very large and wide-reaching suit indeed.
Research Project on Growing Book Challenges in the US
In this case a "book challenge" is an attempt to have a book or other reading material removed from publicly accessible spaces, usually library shelves or school curricula. The good folk at the Comic Book Legal Defense Fund sent out a press release calling attention to a project by the Missourian titled "Unfit to Read?" The project notes that some challenges have been successful and that both the number and success rate of challenges appears to be on the rise; it then examines reasons for these trends, with some examples and supporting graphics.
TorrentFreak reports on leaked MPAA internal memos that highlight the problems the Cartel is having with trying to buffalo the UK's law enforcement into joining its private army, where the US DOJ is already captive - namely, people think it's not right. In fact, so many sane people, even in the media, think it's not right that the MPAA can't get any favorable coverage. Boo hoo.
And when you can't do that, then you need "third parties" (as the memo calls them) who will deliver your message for you, while not appearing to be you. We have a different name for that: lying, or more politely "astroturfing." Basically you recruit some patsies (Boingboing calls them "sock puppets") , feed them your prepared scripts, and have them trick journalists or other citizens into believing that anyone at all, beyond possibly the criminally insane, thinks it's a good idea to ruin this guy's life.
In case you are concerned that TorrentFreak might be engaged in its own misrepresentation, there's a Scribd embed in the story. The document appears to have no seal or other identifying mark on it, so you'll have to judge for yourself whether it's real. Or you could ask the MPAA whether they're employing the same tactics here that they used to try and manufacture support for SOPA. Maybe it's coincidence... yeah, that's it.
On his personal blog, Lauren Weinstein catalogs the history of this current #NBCfail. His focus is on the Streisand Effect but I was taken by the NBC network attitude that American audiences are "too stupid". We're too stupid to install TORbutton, too stupid to watch sporting events without editing and commentary, and too stupid to figure out and get away from the ongoing scam that is pay-one-price-for-shit-you-don't-want cable subscriptions. Yeah, right. I'm reminded of Amanda Palmer's observation that the entire big-label music industry is built on the premise that people have to be tricked into parting with their cash. Can you imagine if television was built, instead, on the idea that there are millions of passionate fans out there who will pay money to get what they want, when they want it, how they want it? That would be cool.
Nick Bilton blogs for the NY Times about Craigslist. It's generally a familiar story: the old established business protects itself by legal threats, unexpected API changes, and generally working to lock out competitors and innovators who want to build on and improve the basic service.
The difference here is that we're not talking about the typical Big Cartel Corporation; instead, this is Craigslist. Many of us have mental images of Craigslist as being small, local, homey. In fact that's how it started, but in the intervening years it has grown into a multi-million dollar business. Once in a while it hits the news, as happened when it was forced to shutter its adult services sections after charges arose that the ads there were thinly veiled covers for prostitution and human trafficking.
But despite these blips, the service has generally retained a genial and positive public image. Bilton argues that part of why Craigslist - which has generally grown old, creaky, and ripe for disruption - hasn't been surpassed is the large surplus of goodwill and beneficent image it maintains. People, even those whose attempts at building new services on Craigslist have been shuttered, don't seem willing to make a big deal of it nor attack the service publicly.
This can only go on so long before people notice and start losing their goodwill - remember when everyone thought Google really wasn't evil? As Fred said, Craigslist (which didn't comment for this story) is in the wrong here and needs to live up to its reputation, not down to its legal bottom line.
Suddenly, it seems, stories about the end of cable television are everywhere. Today's entry from ReadWriteWeb asks how we will watch television in the future. That's actually an interesting question, since I don't expect cable TV to die and vanish overnight. There will be a transition period, which I expect to last most of this decade. Cord-cutting for an individual or household is sudden (we just dropped our cable subscription today, for example) but national trends are slower. There's still time for cable and network execs to realize that people will watch television, but it needs to be served Internet-style, which means much more on demand, much more a la carte, and much better integrated into other digital offerings such as Web sites, social media, and new offerings that are only now in the incubator stages. I will probably not blog a lot more of these general high-level stories but readers with items of specific interest should feel free to keep sending them to me.
Yes, Virginia, TV execs do know where their audiences are - in the US, online, and they don't want you. Unless, of course, you want to fork over $100/month for their massive packages of crap. But seeing the Olympics on your computer? Not this time.
Heidi Moore (for the Guardian) has a nice summary of the #NBCfail that has rolled through the social media sphere since the games opened. You see, there's a theory that you can watch (some of) the Olympics online. But not in the US. NBC has exclusive rights and they don't want to show it to you. Unless, see above, big package, big bucks, big bullshit. The Olympic site itself is no better, using its IP-detection banhammer to tell you to go suck up to NBC if you live in the US. I did try this weekend - I wanted to see some of the live action and compare how the streams performed. Yeah, right.
I mean, really. It's not enough that they fail on time-delay issues, and missing out on broadcasting events. It's a gross ignorance of the size and potential of the 21st-century audience. According to Moore's article, some two million people spent their time reading the #NBCfail hashtag stream. And that number doesn't count people like me who tried and just gave it up in disgust. If NBC are too stupid to capture and profit off two million potential viewers then I have no sympathy for them. As Moore says:
Most Americans would recognize that NBC needs to make money on the Olympics. It is not at all clear, on the other hand, that NBC needs to make money by forbidding millions of people from watching the Olympics.
The creation of artificial scarcity is one of the oldest tactics of monopolists. And, as we saw in the music business and the newspaper business it's all about service to old entrenched models of bureaucracy. NBC thinks it can stop people cutting the cord by creating artificial situations; instead what it creates is animosity and an environment where people openly share advice on how to circumvent blockages. If that doesn't sound like history repeating itself then you haven't paid attention to the last two decades.
Of course, when the US says this sort of thing, they're inevitably thinking of things like the actions by dictators-we-no-longer-support in other parts of the world to sever their countries from the Net in order to further hide repression. I'm sure that the infringements of ACTA and its devil-spawned ilk don't register as human rights abuses. The Netizen project minces no words in this regard, calling out ACTA and the TPP among others and pointing out that Netizens in the US are as divided as the international community when it comes to the hard details of what exactly is meant by freedom and human rights online.
The page describes several ongoing efforts, including competing visions of what a Declaration of Internet Freedoms or Bill of Internet Rights might look like. Messy stuff, but that is, as they say, "...why we are so heavy on the public participation aspect." Maybe the US government could take some notice of that, too.
If you were still in doubt about how we got into the current Copyright Wars mess after reading Drew Wilson's research on file sharing then perhaps the work done by Professor Michael Carrier (Rutgers Law) will help.
Carrier's conclusion isn't likely to surprise anyone who has been reading this blog for a while, but it's worth quoting here:
The Napster decision reduced innovation and [...] led to a venture capital “wasteland.” The article also explains why the record labels reacted so sluggishly to the distribution of digital music. It points to retailers, lawyers, bonuses, and (consistent with the “Innovator’s Dilemma”) an emphasis on the short term and preservation of existing business models.
In painful detail the article describes how the Cartel's scorched-earth litigation strategy managed to bleed or destroy every company that tried to create a legal venture in digital music. As a result, illegal ventures flourished to fill the void. By refusing everything that came along, up to and including full control and a blank check, the Cartel built a legal Maginot Line around which content freely flowed. And in typical Cartel-style behavior, the established music industry threatened, blackmailed, and extorted everything it set its sights on.
I wonder if David Lowery and the others who bemoan the current environment are paying attention. The Cartel may not be directly to blame for any individual's decision to get 11,000 illegal copies of songs, but they certainly are to blame for creating an environment in which nobody (before Apple) could make it routine and easy to acquire those tracks legally. Sadly I don't see any respite coming in the Cartel's self-destructive policies.
(h/t Boingboing and Torrentfreak for the original pointers.)
Nature, the highly respected journal, that is. If you are interested in a quick peek behind the scenes at how editors for big publications balance and swing with the authors trying to get published, I recommend Friday's blog post from Action Potential, one of the blogs at nature.com. It talks about how two similar papers came to be published separately despite similarities while a third paper, also similar, did not get published (there).
I last wrote about this brewing storm in April, when it looked like outrage at astronomical bills university libraries have to pay might finally cause some changes. Instead, it appears that the British have made a bold first move. The notion is simple:
[R]esearch papers that describe work paid for by the British taxpayer will be free online for universities, companies and individuals to use for any purpose, wherever they are in the world.
That may not seem like a lot, but it's a huge deal and if other countries follow suit it could be an even bigger effect. It's not cheap - the government is estimating that UKP 50 million/year will need to be paid out of existing budgets to fund this publication. Of course, that compares favorably to the current UKP 200 million+ that research libraries are paying, but it's not that easy to shuffle money from one pot - the library funding generally coming from things like University budgets and endowments - to the other. Money that scientists have to pay to publish their own work (including servers, bandwidth, staff, support, etc) is money that then isn't available to spend on lab costs, grad students, conference travel, and the other essential components of actually doing the research in the first place.
The final details of the model are not yet nailed down and will probably be fought over at length. Journals and their publishers will of course want to retain control and the free labor system that they now have. Academics will (dear gods, FINALLY) have to re-think how publication and tenure are so tightly bound. The Guardian article describes two competing models, dubbed "gold" and "green", for how research can be opened up. The gold model favors publishers, generally; the green model favors the free and open advocates. It also seems like the new online/open journals such as PLoS aren't being heard here, which is something of a shame.
But still, there's a lot of time to work out how it's going to work, and as Professor Adam Tickell, of Birmingham University is quoted, the UK only produces about 6% of the world's research publications. That means at very best we've still got 94% to go.
These shenanigans remind me of the crap that went on last year with ebooks - publishers and retailers taking out their contract spats on the reading public. Nobody wins in these kinds of disputes, and aggravated customers have all the more reason to get rid of their high-and-mostly-useless cable bills.
The case is called CLS Bank v. Alice Corporation and the PDF of the decision is here: http://www.cafc.uscourts.gov/images/stories/opinions-orders/11-1301.pdf. The case specifically focuses on the question of what in the realm of computer hardware, software, process, etc is patent-eligible. The Court ruled that the system - a computerized trading platform - was patent-eligible, specifically under 35 U.S.C. 101 (this is sometimes called "101 eligible"). In this decision, the CAFC reversed the lower court, which had found that the system was ineligible.
In the majority opinion the Court took some pains to point out areas where decisions such as Mayo seem to have muddled different eligibility criteria, and tried to set the record straight. It also took some not-so-subtle swipes at the SCOTUS opinion and previous dicta from the high court. For example:
The abstractness of the "abstract ideas" test to patent eligibility has become a serious problem, leading to great uncertainty and to the devaluing of inventions of practical utility and economic potential.
For those who are coming late to this game, what this is saying is "Hey, SCOTUS, you gave us this test called 'abstract idea' but no guidance on what it means or how to apply it and which patent eligibility criteria it's supposed to affect". The CAFC complains at length that attempts to clarify this matter have not actually added any clarity:
It can, thus, be appreciated that a claim that is drawn to a specific way of doing something with a computer is likely to be patent eligible whereas a claim to nothing more than the idea of doing that thing on a computer may not. But even with that appreciation, great uncertainty remains, and the core of that uncertainty is the meaning of the 'abstract ideas' exception.
CAFC isn't always the final word on patent decisions, though it often is. If this case is taken up a level then the high court might finally use it as an opportunity to clarify what their 'abstract idea' test means. Or, by refusing cert and letting the decision stand, the Court could be implicitly saying that CAFC are right and that computer system implementations like Alice Corp's are indeed 101 eligible. That's not as definitive as a real ruling but at least it's something.
(Thanks to Greg Aharonian of Internet Patent News Service and PATNEWS for pointing me to this decision and the key parargraphs.)
Back in the old days, when P-A was just two people, they ran for a year on donations but as the enterprise grew so did its need for (paid) services such as bandwidth/hosting, and professional staff that have families to support. This is an intersection of two threads that I've talked about in this blog: the need for artists to get paid, and the ongoing change in relationship between digital media audiences and advertisements. I wish them well and look forward to seeing how this comes out.
As I've mentioned in my posts on "Safe Harbor" it's crucial for the DMCA's application that a safe harbor claim be made on the basis of provider neutrality. If Verizon wants to give up its claim that it is a neutral provider, then it suddenly becomes liable for every bit of infringing content that flows over its pipes. Dear Verizon, have you gone batshit insane?
Not only would that lead to a renewed flood of lawsuits and complications, but it would raise a whole host of issues of whether or not Verizon is claiming some kind of ownership over the content that it provides. People who feel that Verizon is trying to claim some kind of ownership of their content may themselves be moved to sue. This is very dangerous ground to tread and I suggest that Verizon might want to read the position paper that Google recently had prepared on the editorial role of search result-provision.
The parallels are surface-obvious, but functionally subtle and vitally important. Google is in fact editing the Web to produce an organized set of results. Google chooses what sites to crawl, which to index, and how to organize the results for display. However, much as they might mislead you otherwise, Google isn't the Web. There's lots of stuff on the Web that isn't in Google (or any other search engine). Conversely an ISP like Verizon shouldn't care what is or isn't in the Internet. If I type a URL then either that resolves or it doesn't. There doesn't need to be any editorial judgment involved, and trying to pretend to edit the Internet is just daft.
Boingboing pointed me to this story on Billboard about how the band Def Leppard are still sticking it to 'the Man'. In this case the "Man" is their (uncooperative, theiving, Cartel-member) conglomerate Universal Music Group.
The members of Def Leppard assert that UMG is screwing them over compensation for digital downloads - details aren't given. Since UMG won't cooperate, but controls the band's back catalog, the band has first of all given the label a flat "no" to anything the label wants to do with Leppard's music. UMG may own the rights, but the band's contract apparently requires their approval and they're just flat-out refusing to give it.
What makes it more amusing is that Leppard then took it one step further, by going back into the studio and singing themselves "into a certain throat shape" in order to produce "forgeries" of their own back catalog. These forgeries then serve as a digital substitute for the back catalog that UMG holds, but which is now rendered worthless.
According to the Billboard story the two re-recorded albums tracks have sold about 26,000 copies so far which isn't a lot but my guess is that all the profits from those sales are going to the band, making it far more profitable for them than whatever pittance UMG wanted to dole out.
(ETA: commenter Phil S noted that the forgeries so far are just two tracks, not entire albums. That's less cool in that most of Leppard's back catalog remains unavailable by legal digitized means, but cooler for them in that they have 26,000 sales of just two tracks. Even if the others sell at the lower 5,000 downloads/track rate they could see significant income from the work.)
A: I've refused to buy retail CDs since the Cartel went after Napster, long ago. I buy used CDs, sometimes. Often I buy new CDs from artists via their Web sites or at their shows. I buy through iTunes a fair bit, and rarely from other stores like Amazon or Beatport. Almost all the music I buy is stuff I found via some kind of free sample. I found Beats Antique because someone remixed them, which led me to finding a (probably illegal) video someone had posted on YouTube. That's two transgressions already, but the end result was that I went to their show and bought all the CDs they could sell me at the venue. This is how I thought it might work, which is why Emily White's story surprised me.
A: Sadly, no. I'm a terrible book reader these days. Decherney's publisher was kind enough to send me a review copy and that still took me a while to get through. I'm always willing to look at a book or a related product but I can't promise I'll blog about it. I don't hesitate to say something if I think what I've seen isn't that good but I try not to go out of my way to stomp on peoples' toes.
Q: Speaking of Legitmix, do you think they're going to fail?
A: Not exactly. I just don't expect them to be revolutionary. I expect that some people will use it, and lord knows most DJs and producers can use more income. If Legitmix makes them a few bucks then that's all to the good. I'm just doubtful that it's a scalable business model. Stuff will continue to be released as it is now, and also companies like Legitmix will have things to offer.
A: The problem is crap patents. Attacking the problem once the patent has issued is always going to be a second-best solution. So let's focus on removing the crap first.
First and foremost, stop stealing their money. Congress uses PTO fees for all kinds of things that have nothing to do with patenting or the office.
Second, do things that will lead to reduced pendency but without directly rewarding examiners for doing more exams. People do what they're rewarded for - if you just incent examiners to clear the backlog then they'll do that and cut quality corners along the way. Instead, use that PTO money for more staff and training. Give examiners access to all the public searching tools ever: Medline, Science Citation Index, Physical Review Letters, and of course the major search engines. If those tools cost money, pay for them.
Third, allow examiners to make summary rejections and make it mandatory that any patent application which cites no non-patent prior art be rejected before any examination. There is nothing so new under the sun that it hasn't at least been hinted at in the literature somewhere. When I noted that some of the patents Apple was asserting were "strong" that was in part due to looking at how much of the published literature they covered. Nothing slows down patent review more than the applicant making the examiner do all the prior art searching. In my more bitter days I also want to see applicants who clog the system with junk applications subject to fees for filing frivolous patents the way people who abuse the court system can be fined for bringing frivolous lawsuits.
Fourth, do something to bring clarity to the law and cases around patentability. Maybe it requires appointing a special court - we have those for national security matters and for tax litigation, why not for patents? Or maybe a court is the wrong model and we'd do better with an independent board of arbitration. Whatever the system is, it would need to be as independent as possible from the PTO and from whatever political party is in power.
(So, there you are. I probably won't do this often, but the last month or so of stories has brought more questions than usual. Thank you.)
However, I don't care much about enterprise software. What I do care about is gaming. And this is a freaking nuclear bombshell for the gaming industry if it holds up. Right now we're in the death throes of the boxed-sale model for gaming. Services like Steam, Origin, and Amazon have shifted people's purchasing habits away from physical media and toward downloaded games. Never you mind things like the App Store (iPhone) and Play Store (Android) which are selling millions of download-only programs. Even stodgy old desktop and console gamers like me
are doing the vast majority of their purchasing online these days. Always-on, high-speed bandwidth has made it the norm for people to download even very large big-name titles.
This reminds me of Redigi here in the US, which is trying to legitimize resales of iTunes purchases. In both cases the claim is that the company can deploy technology to ensure that only one digital copy ever exists. You buy a tune or game as normal, but when you want to resell it, the item is removed from your computer disk/account. You can't access it again, and when it's repurchased that purchaser gets, in effect, your copy. Just as with physical media, the original seller may not see more revenue but the practice is legal under first sale.
As a practical matter I expect that if this ruling stands the online game sellers will adapt to it. You'll probably have to pay a service fee to transfer your purchases back, and you can imagine situations in which people get a discount in exchange for giving up resale rights. Smart retailers will likely copy the practices of places like GameStop (US, physical) and Greenman where you get more in store credits for returned games than you can get in cash. There are a lot of business opportunities that can be opened up here - it's exciting.
As a related aside I wanted to note that the American Library Association has just filed its amicus brief (PDF link) in Kirtsaeng. As I mentioned before, the ALA position is that this case threatens to tear apart the entire practice of library donations and lending if it is upheld. Clearly the US should not go on to destroy crucial first sale rights and the Europeans should be celebrating their new freedoms. Happy 4th of July, guys.
Another story I've been sitting on for a bit, though much less detailed than yesterday's, may affect many more people. The television business is dying. Or so said Henry Blodget, CEO of Business Insider. If you know that name you might be remembering that Blodget got himself perma-banned from the securities industry for civil fraud in 2003. He also writes for other publications like Slate and Newsweek, mostly doing what he did in the securities business: predicting.
In June he predicted that the television business was on the verge of collapse. In particular, Blodget argues that the television industry is following the same fatal mistakes that the newspaper business made in the past decade, confusing increases in things like viewer numbers for a sustainable revenue model. In particular, Blodget zeroes in on the way that digitization (both Web and digital cable/DVR) have changed our relationship with advertisements, which are the major source of television revenue. No shock to anyone who's paying attention: we don't watch ads.
The problem isn't limited to broadcast channels, which are generally free to receive and almost wholly supported by ad revenue - cable channels that depend on subscription revenue are also likely in trouble as people start ditching their cable lines the way they have been ditching their landline phones. This isn't an immediate problem, but if you project out ten years into the future I agree with Blodget - there's not much reason for people to keep their cable subscriptions. Shows come over the Web, particularly because that enables people to watch on whatever screen happens to be in front of them, be it television set, desktop PC, or tablet. New competitors (iTunes, Amazon, Netflix, Hulu) are taking aim at the money that Blodget notes is currently being "wasted" on cable subscriptions. These new competitors will also give us more on-demand options, and cater more to our schedules.
I "watched" the ACA decision via Twitter and the SCOTUSblog live stream. Those sources had it right. I didn't need a talking head on a screen to tell me what was going on, and I sure don't need to pay thousands of dollars a year for 500 channels I never watch.
Coda: One reason I hadn't posted this story yet was that I was waiting for someone to refute Blodget's numbers, to show where his reasoning was wrong. Instead, I got a notification that HBO has decided it doesn't want Web subscribers' money. Really, HBO? Your response to a campaign of people who are trying to give you money is "no, go away, we don't want your cash." If Blodget is right, and I believe he is, then the television business will have nobody to blame but themselves when their fire sales and funerals roll around.
I've been sitting on this post trying to formulate it at reasonable rather than essay length - I hope readers will forgive me if I go on some. I'm also uncomfortable calling out the EFF for wrongheadedness. I know they're smart people who are trying their best. Usually I support them, but this time I think they're substantially wrong. If you're not familiar with their latest "Want to Abolish Software Patents" effort you can read the discussions and proposals at the project's new site.
I think the campaign to abolish software patents fails on three grounds:
Theoretical: I don't see how you can abolish software patents without also abolishing hardware patents.
Business: I don't see how you can abolish software patents without finding an alternative for people who need legal protection for key information/IP assets.
Message/messenger: abolishing software patents is like trying to abolish cars because some companies make unsafe cars and lots of people use cars to kill/maim other people.
I will agree that the current state of the patent system, and particularly the way large tech companies are abusing it, is a national disgrace. If getting publicly slapped down by Judge Posner doesn't serve as a wake-up call then maybe a few more resounding smacks are needed. But bad behavior isn't the same thing as a bad technology. Let me take first my list above and then talk about Defend Innovation's proposals.
First, if you're not familiar with the Church-Turing thesis then let me summarize: anything you can compute (algorithm, software) can be embedded in a machine (hardware). If you are opposed to software patents then you must explain why I can patent a machine that executes precisely the same algorithm as the software I can't patent. I work in high-frequency trading, a business in which there is an ongoing debate about whether things like programmable arrays are better than general-purpose machines due to speed and other factors. But nobody debates that the FPGA (hardware) and the C code (software) are following the same procedure. You could theoretically oppose patenting hardware AND software, but not split the two. At least, not if you understand a core concept of computer science.
Second, stripping patent protection away without giving inventors some other means of protecting their inventions leaves software innovators at a severe disadvantage compared to hardware innovators, and compared to large companies. Once you know something is possible it's often easy to deduce how to do it, so why should you pay the clever fellow in the first place? There are alternatives to abolishing patent protections; for example, we've talked about trying to restrict patents to defensive-only uses. And we've talked about patent pools. I still believe that the monopoly grant given by a patent should be subject to more restrictions. But you can't just hand-wave them away and not talk about the consequences.
Third, it seems to me that an effort to abolish software patents is a classic baby-with-the-bathwater fallacy. Patenting in the US is in an abominable state. Prior art is a joke, patent searching is ridiculously hamstrung, the USPTO regularly has its resources stolen by Congress, and on and on. Never mind the layers of confusion added to ambiguous law by equally unclear court decisions. But nothing in the current brokenness convinces me that the system is so irretrievably flawed as to require abolishing. We didn't abolish cars after the Ford Pinto, nor should we have.
That said, let's turn to the specific proposals EFF is putting forward...
1. Patent terms of five years. Why? Computer innovations take just as long to bring to market and make mass consumable as anything else. You can look at everything from icons on a computer screen to the latest swipe gestures on mobile devices and trace their roots back 20 or even 30 years. It may seem like the pace of innovation in software is particularly rapid, but it's not.
2. Allow defendants to recoup fees & costs. That's not unreasonable. There are safeguards elsewhere in the legal system to help people recover from frivolous lawsuits. This would need to be coupled with procedures for summary dismissal with prejudice, too.
3. Require running code. This has intuitive appeal in that there used to be a requirement for embodiment of an invention. Embodiment in software isn't per se a stupid idea but it's missing the point. The language of the proposal complains about patents being "confusing." Maybe so, but how are software patent claims any more confusing/less clear than any other claims? And again, why impose an additional embodiment requirement solely on software patents? If you think embodiment is a good requirement for patent grant then it should be a requirement for all patents. And, really, trying to match up lines of code (in what language?) to patent claims is just dumb. Is my javadoc sufficient? It's woven from procedure headers, not lines of code. If I submit the output of the compiler instead is that somehow less valid because it doesn't have lines of code that match patent claims? Come on, EFF, you are better software engineers than this.
4. Allow innocent infringement. Again, not an entirely stupid idea if applied to all patents. I just see no reason to single out software. However, it compounds the willful ignorance of prior art problem. Currently on my patent application I'm required to disclose any prior art of which I'm aware, which creates an incentive for me NOT to know about other inventions. This leads to absurd versions of "I'm sorry, Congressman, I cannot recall what I was doing in that laboratory with that young lady on that date." Innocent infringement doesn't solve anything - it just moves the scope of culpability from the disclosure section of the patent to the courtroom.
5. Improve notices and timeliness. Also generally good ideas that miss the point. As the current most-upvoted comment on the page today says, it doesn't matter how up to date records are so long as there are anticircumvention laws on the books that prevent you from decompiling or doing other things that would permit you to know if a chunk of code is in fact infringing.
6. Limit damages. A favorite whipping-boy of everyone from anti-malpractice Republicans onward: juries give out too much money for trivial offenses. True. And? What this really requires is more Posners and their ilk who will knock down the foolishness of plaintiffs and their lawyers. I'm not generally in favor of arbitrarily legislated malpractice caps and I can't see any reason why patent liability judgments should be treated differently (see a theme here?).
7. Congress should study the issue. Uh, yeah. I'm not even going to touch that one. Except, seriously, if you're going to talk about abolishing patents then I think it's incumbent on you to describe what you want to replace them with. My personal opinion remains that we should encode into patent law something like the Breyer test, which would permit violations of the patent's monopoly grant if it could be shown that the patent was not serving its Constitutionally created purpose.
I have a bunch of other ideas on how one might go about fixing the current patent mess but since this post is epic long already and is supposed to be about how badly the EFF's latest scheme fails, I'll leave it here.
Jeff Price of Tunecore - a business based on helping individual artists release and sell digital music - notes that Lowery is ignoring how badly musicians had it, before. Price also disagrees with just about every factual number in Lowery's post, pointing out that while it's true that labels are making less money, more money is flowing to the artists. Sale for sale that's clearly true - what's less true is what the overall picture of the industry is now versus in the big-label era. There just aren't good independent data available for an apples-to-apples comparison.
Unfortunately, much of the response to Lowery has been of the "quit whining" variety. While I sort of sympathize with the idea that it's important not to shed too many tears for old dead businesses it's also important not to lose sight of the fact that what Lowery was "whining" about was the self-confessed theft of thousands of song copies, many of which could easily be paid for via a few clicks on iTunes or Bandcamp or the artists' Web sites. Jonathan Coulton is noted as responding about how great it is that so much more cool stuff is now available free. I agree, that's an awesome thing but it has to be the artists' choice.
I love free tracks. My disk is full of freebies I've gotten from performers I love. But it's also full of tracks I bought from them. That's the choice I get: pay for what they sell, or don't. Their choice is to sell, give away, or use some combination/new model. Again, I feel this is an important point that is getting ignored because of how Lowery constructed his response.
As several of the respondents note, simply being a musician is no guarantee of making even one thin dime. If you price your stuff wrong, or nobody likes your stuff, or whatever the factors are, then you're not going to make a living. Maybe you have to bust your hump for years until one day dawn breaks and money appears. Nobody owes you money because you're making the art you love. But I don't think that's really what Lowery was trying to say.
In specific, O'Dwyer ran a site that linked to online television programs. You know, the kinds of things you can find via a Google, Yahoo, or Bing search. But nevermind that, his site (which was never on US soil either) apparently violates the law in some way that those search engines don't. Mostly by being run by a poor individual rather than a large corporation, I'm guessing. As a result, O'Dwyer is now facing extradition to the US where he could be looking at a 10+ year sentence for - I keep having to say this because it's so unbelievable - doing nothing wrong.
Sign the petition if you haven't already (as of this writing they're closing on their initial 25,000 signature goal) and please if you live in the UK contact your representatives - anyone whose voice the Home Office might hear.
Back in 2006 I blogged briefly on the case of Mr Moore, who was being sued by the University of Alabama. The cause of action was Moore's use of the University's trademarked crimson-and-white color scheme and football player uniforms' appearances in his paintings. In an opinion a week or so ago, the Circuit upheld the trial judge's summary judgment in Moore's favor. In addition, the Circuit reviewed Lanham Act (trademark) claims and again found in Moore's favor. No word yet on whether the University will appeal, but having lost two rounds I have to wonder if they really want to keep spending money on this.
It is necessary to make three observations about this decision's scope. First, because the Court resolves these cases on fair notice grounds under the Due Process Clause, it need not address the First Amendment implications of the Commission's indecency policy or reconsider Pacifica at this time. Second, because the Court rules that Fox and ABC lacked notice at the time of their broadcasts that their material could be found actionably indecent under then-existing policies, the Court need not address the constitutionality of the current indecency policy as expressed in the Golden Globes Order and subsequent adjudications. Third, this opinion leaves the Commission free to modify its current indecency policy in light of its determination of the public interest and applicable legal requirements and leaves courts free to review the current, or any modified, policy in light of its content and application.
That's disappointing, but not wholly unexpected. SCOTUS has declined to rule on the First Amendment issues of the FCC's policies before. I'm disappointed, as I believe that arbitrary restrictions on word choice - with or without prior notice - are the essence of government censorship that the First was designed to prevent and that the FCC remains an agency that is too far out of control. It needs to be reined in strongly, not invited politely to write a new ridiculous set of rules that will have to be litigated for another decade.
However, since the focus of this blog has shifted considerably in the last half-decade this will probably be my only post on this topic.
His initial target this time is Emily White, an intern at NPR's "All Songs Considered". Ms White noted that she has over 11,000 songs in her music library, yet has bought only 15 CDs in her life. The clear statement is that she acquired the vast majority of that music illegally. White is just the launching point, though, as Lowery continues to rant about the "Free Culture movement", which he believes is the propaganda arm of largely unnamed "technological and commercial interests."
If this is starting to sound like looney-up-the-creambun-and-jam stuff to you, then welcome to the club. This is really a shame, too, because Lowery continues to have really important and cogent points to make. It's just that they get lost in the froth sometimes. Let me focus on what I think are the important bits.
Lowery notes that the majority of record companies do in fact pay their artists. Despite numerous well-publicized examples of despicable behavior, it's generally true that buying major label-produced songs or CDs will cause artists to get money. I don't buy major label-released CDs myself, but that's for personal reasons. Whether the CD is major- or indie-label released, the artists (and their support crews, engineers, etc) will get some money from a purchase, whereas downloading 11,000 songs and not paying for any of them will cause no money to flow.
He also notes that the vast majority of artists are really poor. This is indisputable and a seriously bad situation - those of you who read this blog regularly have heard me banging on and on about how artists (of all sorts) need to get paid. However, the fact that musicians don't generally make a good living has been true for at least the last five decades and the advent of digital music hasn't changed it and shouldn't be blamed for it. Not to mention that the "critically acclaimed but marginally commercial artists" Lowery likes are that way because their labels dropped them like hot potatoes the instant their sales dropped below some accountant's decision point. Again, that's been true for a long time - if you want to blame someone for that, blame Reagan-era changes in depreciation tax credits. More or less overnight it became incredibly expensive for record, book, and other makers to keep inventories of things around. Either your album was a hit out of the gate or it got scrapped (or in the case of books, pulped). Again, all this predates digital music by a long time.
Lowery has obviously been affected by the (self-inflicted) deaths of musicians close to him. How that is connected to illegal downloading is left to the readers' imagination. Likewise, he has a great idea: pay $18/month and get the music you want. Except he isn't clear on how his theoretical model would work better than the other subscription services that have so far failed to gain significant traction (in part due to labels' unwillingness to license content), or how a new service would funnel more money back to musicians who aren't getting (he feels) enough from existing services like Spotify.
Lowery points out that services like Pandora and iTunes have gone a huge distance toward making music easily accessible. The user experience of these services is way the hell better than things that came before. So why isn't Emily White, and generally her peers, using this service? Lowery's answer has to do with cultural brainwashing and rants about Kim Dotcom, which is a shame because it's a really good question. I've been thinking for at least the last 6-8 years that if the user experience was good enough then people would prefer the higher quality and convenience. I make my living doing user experience and I believe deeply in the power of a good experience. Have I been deluding myself?
I might be wrong, but I won't find out whether or why by ranting about Google, Viacom, Kim Dotcom and pretty much everyone else on Lowery's hate list. I hope White will respond - it's hard to be called out by a major industry figure for something she seems to know she's done wrong. And, to his credit, Lowery is very kind toward her personally but his adamant angry stance may not invite the kind of response that would enlighten us.
Finally, Lowery cites unsourced figures again claiming that the music business is in terrible shape. The 90/10 rule has applied far longer than digital music has existed; if it's now the 99/1 rule instead of 90/10 you need to show why - again, see Drew Wilson. Lowery's experience isn't in question here - the question is why he's going so far off the deep end at points.
The book focuses on the film industry in the US, starting from its earliest days. It is mostly concerned with formative battles over intellectual property (primarily copyright) in the early and mid-20th century, devoting only the final chapter "Digital Hollywood" to the age of the Internet and key battles such as the DMCA/safe harbor/fair use exemptions. He also keeps his eye pretty strictly on the film industry, and its spawn into television and recorded movies. This is, then, a work largely of cultural and political history, and is extremely useful for anyone who wants to understand how we got to where we are.
Decherney makes a couple of key points throughout the book that stuck with me. First, "piracy" isn't new. Early film pioneers - including Edison - did things like copying others work in ways that would now be regarded as violations. "Piracy" is a loose term, then, that Hollywood has always used to mean "things being done by people we do not like who are not us." - even if those are things that Hollywood itself was doing just a few years ago. Once it's being done by Hollywood the act is no longer piracy and that term is then shifted and used to refer to new actions.
Two, he notes that Hollywood has long dreamed of a realm of total control. The major campaign within the last 20 years to turn the "play" button into a "pay" button really originates over a century ago. Through litigation, Congressional lobbying, and business decisions, Hollywood has tried to steer itself into this sort of cultural/legal monopoly. With the DMCA they have gotten closer than ever before to this goal but they've done so only by handing massive amounts of control to third parties - generally tech companies like Apple - who have used monopolistic legislation like the DMCA to attain their own total control.
Decherney also does a good job of showing how much of what has gone on has been a combination of careful planning, incoherent response, and internal division. For example, the infamous Betamax case was not pursued by Hollywood monolithically. Hollywood has simultaneously pursued court decisions and ignored them. And different studios (and the auteurs with whom they must deal and often fight) have responded differently to fringe copyright activity such as fan films, parodies, and homages. The result has been to create a climate of uncertainty in which new gatekeepers such as film-festival promoters and insurance companies have been forced to play guessing games about what will or will not be treated as infringing and subject to lawsuits or cease-and-desist orders. With uncertainty came self-restriction, a regime that new mass-creation technologies like YouTube has exploded, to Hollywood's deep panic.
I have two minor quibbles with the book, which I hope Prof Decherney will change in a future edition. First, he does 'the professor thing' too often. A paragraph will begin with a question, which the body of the paragraph then answers. This comes across as pedantic. I think Decherney's prose is interesting enough to stand on its own and he could remove the rhetorical questions entirely.
Second, the book is extensively footnoted, but the notes are purely reference links. Reading them is as dry as reading the notes on a court decision. I love the little minutiae that some authors put into footnotes. There's a wealth of trivia, anecdote, and digression that can't be fit into a coherent main-text narrative but still makes for good reading. I hope Decherney spices up his future end-notes with some of the good bits that didn't make it into the main text.
In conclusion: recommended reading for good context and understanding.
I talk a lot about the need for new business models that are realistic and sustainable in the digital-centric 21st century. Sadly, we're also in need of some serious updating of government policies and practices, too. David Kravets had a nice piece on WIRED yesterday profiling Judge Sofaer, a man of long judicial and prosecutorial experience. Sofaer has joined EFF in fighting the US DOJ's seizure of innocent peoples' content just because that content happened to be hosted on a Megaupload server. In the piece Sofaer notes that there are reasonable, well-tested procedures for handling things like seizures and criminal evidence that simply aren't being applied to digital cases.
An "epic and surreal legal battle" is slowly taking shape out there in IP-land. If you are as ancient as I am, you remember days before photocopiers made it possible to reproduce any book or printed page quickly, cheaply, and en masse. When photocopiers got cheap enough and widely enough distributed the inevitable happened - people photocopied their butts. Wait, no. I mean, yes, they did that, but they also did stuff that had IP owners tearing their hair out in frustration. Nobody photocopies novels and resells them, but teachers would put together course packets containing hundreds of pages of material photocopied from a variety of sources.
At first, nobody thought about paying for all that copying, even though getting the important chapters for free in your course packet meant you didn't then have to buy the book. There was a time when mass photocopying was seen as the worst threat to publishing. Eventually, things settled out. Universities and others worked out licensing deals. Students had to pay for course packets and some of that money flowed back to publishers who didn't get as much as if everyone had to buy every book, but they did get something. Copying went from being an unholy terror to an understood devil we live with.
Fast forward to the 21st century, and along comes Makerbot, and a hundred more like them. These home machines let you print new objects, some of which didn't exist before. Others, depending on the digital models you load in, can be exact replicas of existing objects that are covered by things like patents. This is almost certain to engender a nightmare similar to that of the early photocopy machines, particularly as new versions of 3-D manufacturing machines are going to have scanners that let you start with an object and generate a copyable model file on the spot. Three-D printing will become the new photocopying.
As Clive Thompson describes in the above-linked article for WIRED, the problem right now isn't so much the machines: it's that people create and share their design files. Those files allow one person to empower other people to make many copies. Even though those copies may be used only for individual purposes, the people whose objects are being copied claim infringement. If I can print up my own Warhammer figures for cheap, why would I buy the Games Workshop originals? You can see why GW and others want this stopped.
The question, then, is who is at fault for infringement. The answer is not obvious and as with all new technologies I expect this one to be thrashed out in court. One possible target would be the person who created the file. Another would be the sites (e.g. 3D Model Sharing) where the files are posted. In the case Thompson describes, the site Thingiverse received a DMCA takedown notice. I'd bet you could make a good case that this was an inappropriate use of the DMCA.
The problem is that the file isn't itself a copy of anything. It's an original work. Posting a design file isn't the same as posting a track I ripped from a CD. The file, if used in a certain way, can produce an infringing object, but I cannot see how Games Workshop could claim patent protection for that file. I'm reminded of the many faces of DeCSS where the movie industry tried to put a stop to every possible way that the DeCSS code could be expressed. Model files are code and code is infinitely malleable. Maybe GW claims some kind of contributory copyright infringement and that's the basis of their DMCA notice, but that's new legal territory as far as I know.
If you accept that the file (code) itself isn't a violation of the object IP owner's trademarks, patents, or copyrights then you're left with two options: go after the machines or the end users. Going after the machines is a losing plan; it would essentially recapitulate the Betamax argument and it would be trivially easy to show that these machines have substantial non-infringing uses. Finally, you don't want to be in the business of going after the end users, unless you're batshit insane like the Cartel and think that suing your customers is a winning business model. Given that most people are not that level of insane, I think we're going to see a continued targeting of (easily intimidated) model-makers and reluctant cooperation by the sites that post the files. Nobody wants to be the next Megaupload test case.
This may discourage or slow the growth of some sites, but since there's already model-sharing on the P2P networks I don't think it's likely to have a huge impact. There needs to be some kind of grand agreement and that's not likely to come soon. Thus, court cases.
(Full disclosure: I'm friends with Sindrian Arts, a company that is trying to bring industrial-scale machinery (a CNC router) down to personal size and price. This machine, like Makerbot and others, could be involved in this brewing legal battle.)
C-11, which I last mentioned here about three months ago, is Canada's attempt at a comprehensive copyright enforcement regime. And by "comprehensive" I mean "is the vehicle into which the Canadian arm of the Cartel is attempting to stuff every insane lock, restriction, punitive enforcement measure, and penalty they can dream up."
Specifically, one Harry Page, the CEO of a company called UBM TechInsights, testified against the bill. Mr Page makes his living (among other things) helping people enforce their copyfights. His firm uses various forensic techniques that can be applied by people who want to determine if their material has been used by others. But C-11, as presently written, has measures that would prevent that. So all a thief would have to do is lock up stolen content behind some kind of DRM or encryption and presto he'd be safe. Great work, guys.
Geist notes that Page is hardly the first one to raise these objections, or to propose ways around it. "[B]usinesses, consumer groups, [and] education [professionals]" have all raised similar objections and been ignored. There's a word for laws like C-11, and the FCC doesn't like it when you say that word.
They delicately refer to her as Ms Palmer (I'm trying to imagine The Economist printing 'amanda fucking palmer' as she signs herself) and warn their readers about her "exuberant nudity" and "salty" language in her updates. But for all the properness, the blog notes that this was not off-the-cuff; it was three years in the planning and followed three self-releases and a smaller Kickstarter last year, as well as a detailed post-mortem with the Kickstarter team.
I noted yesterday that it's unlikely someone else would succeed by trying to imitate Palmer - you can't authentically be another person or use another's style. It's easy to look from the outside at Palmer's disjointed writing and the frenetic enthusiasm that are part of her signature style and mistake that for a lack of good sense. But when it comes down to business fundamentals: plan, experiment, analyze, adjust, then launch - that's a formula anyone can follow.
The particular property/behavior in question is the now-AOL-owned Huffington Post. The HuffPo is sometimes criticized for being "just" an aggregator, but regardless it's widely understood that HuffPo has had problems with people critiquing how much of a story it has used. As techdirt points out, in the past the HuffPo has taken all of an article it is aggregating and added its own value, claiming that the result is fair use.
Well and good, so why are AOL's lawyers now hitting a small-town blogger with cease-and-desist letters for that blogger doing pretty much exactly (to AOL's hyperlocal Patch) what HuffPo did to others? C'mon, guys either it's fair use or it isn't. You can't both claim fair use when you're doing it to other people, and infringement when others do it to you (well, unless you're Disney and Hollywood studios in general, a matter in the queue for next week).
Sisario talks about Palmer's "theatrical gestures", which I think is slightly missing the point, and her intense and uniquely personal broadband engagement with her fans, which I think is much more relevant. AFP, in her Kickstarter updates, has noted that other musicians who want to do this sort of thing will have to find their own way. Trying to "be" or "be like" Amanda Palmer isn't likely to work, simply because she has a certain personality and a certain style that most people don't have. Trying to fake it won't buy you anything because you're not (supposed to be) about faking it or passing as something else.
Sisario talks about Palmer's "experienced managers and publicists" as if that was somehow a mark against her authenticity. But Palmer's own Kickstarter Q&A pointed out that someone who wants a successful project of this sort needs to have it planned out. Knowing ahead of time what updates you want to do, what bonuses you can add, how to get the campaign noticed, etc are all vital to success.
My view is still that there's a business opportunity here, helping artists who aren't as Net-/social-media savvy as Palmer put together a successful sponsorship campaign, and possibly let the artist have a life, make art (or music), and get the money they need. How to do that without losing the personal, deep-connected authenticity that motivates a group like Palmer's fans is a question yet to be answered.
As I noted in the earlier blog post about Scalzi's DRM-free Redshirts, one of the important things that needs to happen is simple communication between the creative side and the consumer side. Doctorow's post argues that trade publishers should be diving into that conversation with the news that 'Hey, we're good guys here!'
What Doctorow points out are important differences in how trade publishers, particularly fiction, treat their authors versus how recording companies or movie studios treat their creative types. That difference matters, if we're going to have this conversation I keep banging on about. Not all corporations are alike, and not all copyright holders act like the Cartel does.
Over on his Whatever blog, John Scalzi posted about "The DRM Thing and Redshirts". Redshirts is his latest novel, for which he's just embarked on the book tour and which has just gone out in e-book form. (Cover image shamelessly nicked from his site.) Although the Doherty imprints, including Tor books, are not scheduled to be DRM-free until the end of July Scalzi asked for his book to be DRM-free from now and so it is.
Scalzi is quite active on the nets and pretty tech-savvy, so he understands that DRM itself isn't a barrier to anyone but the casual readers. He also understands that a great deal can get done between a creator and their fans by simple communication, so he put up his four main points for how he'd like things to go. As he sees it, personal uses are great; putting it out into the wilds of the Internet is probably bad karma. He notes that there's a big free sample (5 chapters) already posted so people can try before buying. Above all, remember that this e-book was written by a person who's trying to make his living and support his family by writing books like this.
If you like what he does and want him to do more, then guidelines like these are probably the best way to get what you want. This is one reason that sponsor-type models have intuitive appeal to me: it's trivially easy for me to acquire a set of bits on my electronic devices, but it's remarkably hard to inspire, encourage, and support the kinds of creation that lead me to want those bits.
Information wants to be free. Information also wants to be expensive. Information wants to be free because it has become so cheap to distribute, copy, and recombine - too cheap to meter. It wants to be expensive because it can be immeasurably valuable to the recipient. That tension will not go away. It leads to endless wrenching debate about price, copyright, 'intellectual property', the moral rightness of casual distribution, because each round of new devices makes the tension worse, not better.
I've been enjoying my subscription to Justia's Intellectual Property Summaries e-newsletter so I thought I'd pass on that pointer. Justia publishes a variety of newsletters including editorial stuff, opinion summaries by various (US) jurisdictions, and by practice area, including of course Intellectual Property as well as more specialized summaries related to Patents, Copyrights, and Trademarks. The summaries are brief, generally well explained, and contain links to the fuller case material if something piques your interest.
As things stand now, the person (usually DJ/producer) who produces a track that incorporates material from others is theoretically responsible for obtaining the licenses to all the source material. What Legitmix aims to do is shift that work to the end consumer. Instead of distributing a raw MP3 file of your mix, you'd distribute a Legitmix digital package that listeners would unpack and then obtain all the permissions for before they could listen.
In December I laid out the variety of objections this raises in practice - versioning, orphaned works, uncooperative license owners, etc. It's a great idea in theory but in practice I couldn't see how it would work at scale. A couple days ago, Neal Mc - who identifies himself as "Legitmix Customer Support Guru" invited me to re-look at the site, which I've now done. Having looked I see about the same thing as before.
The site, now in beta, claims to have something like 20 million songs. That sounds like a lot but doesn't address the question of samples from performances, from movies, from speeches, and all the other source materials that go into a typical DJ mix. Maybe Legitmix can get everyone on-board and signed up. Maybe they can figure out some way to handle orphan works - there's no mention of those on the site. Maybe they really can get a "track" identified in under a minute as Neal's comment claims, but how long would it take them to handle this hour-long Glitch Mob set I'm listening to?
Sorry, Neal, but it looks like you still have all the same problems you had six months ago.
Katrina Kaiser has an interesting Q&A with Lino and Mario Bocchini up on EFF Deeplinks. The siblings are in a multi-year fight with the major Brazilian newspaper Folha de São Paulo over their parody site Falha de São Paulo. "Folha" = newspaper, but "Falha" = fail and the paper didn't like being satirized as a failure, nor having its political biases highlighted. The Boccinis are trying to get their domain back, which has been locked down by court order since September 2010.
David Lowery is not happy with the state of digital music. In this post, derived from his talk at SF Music Tech Summit, he goes into great detail on why he thinks the current model of music making and distribution sucks, and is a worse deal for musicians than the previous system (the old boss).
The post is long on opinions, much of it personal. Lowery has a tech background himself, and has worked as a musician, sound engineer, singer, songwriter, promoter and producer. He founded Cracker and before that Camper Van Beethoven. He is an active participant in archive.org, where he has placed recordings of most of the live shows he and his groups have ever done. He's also worked in finance/economics, and wrote code for the company that became Groupon. Through these experiences he knows a lot about technology and how the nets work. He's also had his share of spats with the big music establishment, including ongoing lawsuits against two of them. He doesn't have the academic throw-weight of, say, a Drew WIlson, but he's painting the picture he sees and reasons from.
That picture is not good, in his view. As he sees it,
[W]hat we artists were promised has not really panned out. Yes in many ways we have more freedom. Artistically this is certainly true. But the music business never transformed into the vibrant marketplace where small stakeholders could compete with multinational conglomerates on an even playing field.
He also has some nasty words for entities we tend to think better of, claiming "Google date rapes the spirit of the law while keeping to the letter." He's got a lot of bile for the Future of Music Coalition, and particularly the EFF:
[I]t is nigh impossible for me to pursue my craft without enriching Apple, Amazon, Facebook and Google. Further the new boss through it’s [sic] surrogates like Electronic Frontier Foundation seems to be waging a cynical PR campaign that equates the unauthorized use of other people’s property (artist’s songs) with freedom.
That's true, but seems to be missing the point. Lowery is tech-savvy enough to know that there's a world of difference between a link appearing in Google search results and appearing on a form copy on a different site. People may find it (and it'll be interesting to see what happens when Google starts including crawls of the Chilling Effects site in its search results) but the alternative seems to be a 1984-esque regime in which one might or might know that some content might or might not have been taken down but we can't tell you what it is, never mind giving you the chance to contest it. Because we know DMCA takedown notices are never sent out maliciously, or in error.
But OK, let's jump back to Lowery's main point, which is that what we have today isn't working for musicians. He says that due to the ease of sharing illegal copies of recordings, "the 99% of the music business has been impoverished." He asserts that artists are spending less on recording now because they have less to spend, that more artists are touring and playing more shows, but for fewer people. Yes, there are a few stand-out success stories like OK Go, but they're the exception, not the majority rule.
Lowery admits that much of his information is anecdotal, but his anecdotes are collected from a pretty wide range of sources. He's not just taking one point and generalizing it out to the whole universe. He says that the reduction in time/money spent recording is the most telling trend:
[T]he only explanation for why artists are spending much less time recording is the obvious one [- they have less money to spend]. Occam’s razor. Every other explanation adds assumptions."
In addition to skewering a few of our favorite cows, he also hits on a couple of points I've made in other Copyfight posts: artists need to get paid, and that includes the large and often invisible team behind the guy in the spotlight. Digital downloads are not returning large amounts to artists. Gatekeeper companies, particularly Apple, are taking a big chunk of the dollars spent through them - in some cases a bigger chunk than a standard label would have taken. Tech companies are astonishingly hypocritical in the cavalier way they treat copyrights and the covetous way they treat their own patents. There's no doubt in my mind that the current state of affairs in digital music isn't great, and that we desperately need sustainable business models and fair methods of compensation. I'm just not willing to buy that the plural of anecdotes is evidence, and therefore illegal copying is the cause of all these problems.
As I mentioned, the column is quite long and I'm obviously cherry-picking a few points here. Go read the whole thing and see if I've summarized him fairly.
"It takes a thousand men to invent a telegraph, or a steam engine, or a phonograph, or a photograph, or a telephone or any other important thing--and the last man gets the credit and we forget the others. He added his little mite--that is all he did. These object lessons should teach us that ninety-nine parts of all things that proceed from the intellect are plagiarisms, pure and simple; and the lesson ought to make us modest. But nothing can do that."
Unfortunately, he starts off by bashing Kurtz - whose work he admits not to knowing - for being successful. That sort of personal attack isn't helpful and detracts from the important objections LP is raising. So let's skip forward to the substance.
First, LP notes that the question at hand is whether people who enjoyed the Avengers movie would be willing to donate something like the price of a ticket to the Hero Initiative. This non-profit exists to "create a financial safety net for comic creators". Far too often, people in creative endeavors need help - the finances of writing, acting, drawing, or doing comics aren't always lucrative and sometimes people need help with medical bills or just plain old money for groceries. LP notes that this effort to get people to give money in association with seeing Avengers will benefit many people in the comics business, whereas Kurtz's post was narrowly focused on the Avengers' creators and Jack Kirby.
Getting to the heart of the creative issue, LP notes that Kurtz seems to be shooting a strawman of his own creation. Nobody is asserting "that Kirby and Kirby alone be compensated for his work on the characters." And in fact the more modern Marvel writers and artists who've worked on these characters over the decades since Kirby stopped working on them will not be seeing big payouts from the movie either. Most will probably receive nothing - though movie companies notoriously keep their payout sheets extremely close to their accountants' chests. Who actually makes money from a given movie can be hard to fathom, as the IRS itself has complained from time to time.
Still, take it as given that more people than Kirby have worked on Avengers and more people than Kirby who did such work aren't going to share in the movie's success. Thus, Kurtz's focus on Kirby is misplaced at best, and misleading about the important questions of authorship/ownership and benefits.
Finally, LP points out that issues of creators' rights are still present, still important, and still relevant for discussion. Kurtz's column contained more than a little disdain and, frankly, name-calling which I had omitted in trying to focus on the Copyfight-relevant parts, but LP doesn't hesitate to shoot back, and probably deservedly so.
Moral issues and intellectual property rights have always been oddly entangled, particularly in the US which does not formally recognize artists' moral rights in creations. Calling on Marvel to voluntarily recognize what would be thought of as moral rights is always going to rub some people the wrong way, but is a common feature of charitable efforts.
This post is much more Q&A than the first, but the answers still come in Palmer's unique voice, which makes it fun to read. I'll cherry-pick a few highlights, but recommend it highly to anyone who cares about these models.
She notes, for example, that this kind of thing doesn't work for acts that are too unknown, too obscure, or aren't working hard enough. She points out that other acts she's worked with through Kickstarter projects have also carefully nurtured their fan bases with things like house concerts, free shows, and generally nurturing that fan base over (as Palmer writes it) "YEARS AND YEARS AND YEARS of connecting" so you can go and ask them for money. Palmer also references the '10,000 hours theory' that anyone who spends ten thousand hours doing something becomes an expert at it, and she notes that by this yardstick she's an expert at connecting with her fans.
She addresses file-sharing, head-on: " i think music should be shared. all the time. by everybody. i think it's pure insanity to make music filesharing illegal." It's no accident that you can get the entire album as a high-quality digital download, with bonus content, for a buck (at least for six more days as I write this). The time it would take you to find it on a torrent of questionable quality is worth more than that. Personally I think a buck is too low, but it certainly upends the economics of illegal copying.
She also talks about being fearless. Artists who perform in front of crowds know this but it may be different for creative types who aren't used to connecting so intimately with their fans. Perhaps a direct-sponsorship model like this really will work best for people who are used to it; certainly musicians have been busking on street corners with their hats out for coins for centuries. Actors and other stage performers used to pass the hat as well. Kickstarter, as Palmer points out, isn't a charity. It's a direct appeal for sponsorship funding.
Palmer also makes the point that she is making great art. It's not cheap and it's something she truly believes in. As I noted last time, I want this kind of model to be sustainable as a business, not a one-off thing. That means the fan base you so carefully cultivate also has to be delighted with what you've made. Doing it on the cheap might mean you hit your Kickstarter goal but will it mean those who fronted the money are happy with what they get at the end?
I think this is something we see in other big successful drives; for example, the Order of the Stick reprint Kickstarter (which I also backed). The comic's author, Rich Burlew, has gone above and beyond in the quality of the materials that drive has produced. Everyone I've shown them to has had the same "oh, wow!" response. Principle: delight your sponsors.
This is different, as Palmer points out, from a product-oriented Kickstarter like the fantastically successful Pebble watch. There, the entire point is production of a product that people expect will be delightful. Fans != consumers. Principle: know what you're making, for whom, and how to delight them.
Finally, I wanted to quote a bit of Palmer-wisdom that I think illustrates why this kind of innovation had to come from creative types, and not from the established businesses (the Copyright Cartel):
the music business for years has seen the fanbase as a bunch of faceless consumers who were going to have to be TRICKED into parting with their cash. whereas i see them as people who love art and want to help. attitude is everything.
Capitalization, such as it is, preserved from the original.
Today Google posted on its blog an update to how it talks about transparency. For about two years it has published its Transparency Report in an effort to give people some insight on issues such as search availability, removal of content due to government requests, and even Google's own traffic analyses that indicate when IP packet flow to its servers may be under deliberate disruption. Such disruption can be prima facie evidence that a government or other entity is trying to prohibit people from reaching Google sites or searching Google content.
The new news is that the Transparency Report will now extend to copyright-related issues. They've added a new section on copyright-related removal requests that shows day-by-day removal requests, as well as the reporting organizations and targeted domains. You can drill down to see more detail - particularly full lists of Owners, Reporting Organizations, and Targeted Domains. And if you have the stomach for it you can scan the hundreds of thousands of individual removal requests.
Sadly, it does not appear to be searchable (yet?) so I cannot search to see if someone has requested that, say, material owned by me be removed from any domain. This is important because in the past organizations that didn't actually own copyrights sent takedown notices. Only a copyright holder should be entitled to do that. Like any other 'big data' source the uses to which these data could be put are varied, but lack of search will hamper most efforts.
PvP also deeply embedded within popular modern mass fan culture. One of the main characters in the comic is a total Apple junkie, always buying the latest gadgets on the day they issue. The strip often centers on the gaming magazine business (PVP is a fictional game zine/Web presence) as well as the gaming industry directly. And Kurtz displays a "Joss Whedon is my master now" banner on the site's front page. So he's more than a little bit invested in comic culture and the movie that was written and directed by Whedon.
In this column he's responding to the idea that the Avengers were, originally, thought up in large part by Jack Kirby creation, and as. Kurtz says:
[I]n many comic book industry circles, there’s a lot of hand-wringing going on about how all that money is being generated by Jack Kirby’s creations and none of it is going to his estate.
The problem, as Kurtz lays it out, is that a great many hands have steered the Avengers ship, as well as the stories of its constituent member characters, since Kirby's days. It has been over three decades since Kirby last worked on these characters and Kurtz points out that the images and styles used in the movies are much more based off the most recent incarnations of the characters. Notably, the comic-book version of Nick Fury that is in new stories today was specifically modeled off of the visual appearance of Samuel L Jackson, the actor who then went on to play Fury in the movies.
This raises a difficult question. There is no doubt that a character called "Nick Fury" was co-invented by Kirby and Stan Lee. But the Kirby/Lee character was significantly different from the modern Fury. And it's not like the modern Fury was all that recent, either - the look was launched a decade ago. So who "created" this Nick Fury, and who should take part in the character's lucrative movie success?
Kurtz also thinks that those complaining about how Marvel is distributing the Avengers' windfall are living in the past. He argues that, like the Fury character, the comics industry has revamped itself. The abuses that were perpetrated against people like Kirby and other original creators in the 20th century are, he says, "a battle we’ve already won." Things are better now, and ire against Marvel is misdirected.
Like Kurtz I'm not a lawyer and I haven't yet read beyond the press accounts of the case. I point out this column because I think the case of the Avengers shows just how complicated creative processes are. Sometimes it's easy to say "yep, that person created that thing" and sometimes it's a whole heck of a lot more complicated.
Somehow I missed this when it went up a couple weeks ago: David Post of Volokh Conspiracy writes about the Supreme Court's decision to review Kirtsaeng v John Wiley. He calls the law involved "baffling" and "baroque" and provides good background on first-sale doctrine and the cases that have led us to the present (broken) situation.
It's short on detail and long on concept, but it's still worth reading as it rattles off the very long list of people and things and responsibilities involved in making a major multi-faceted project come together. As I wrote back in April when I signed up for the Kickstarter, this particular vision of music's future isn't just about a band, an album, a tour. It's about bringing together dozens of creative people each contributing to a multi-faceted, multi-experience endeavor. And that kind of thing doesn't come cheap, even when many (most?) of the people involved are your friends and colleagues who share your vision and dedication.
Everyone needs to eat and artists need to get paid. If I have any criticism of AFP's approach here it's that she's very dedicated to pointing out that even if the Kickstarter clears a million bucks she's not going to get rich off it. That is important, especially when you're asking people up-front to give money and trust they're going to get something worthwhile down the road. As Palmer says, "...paying now for value later is what historically would’ve been a label’s primary purpose."
Since we (the Kickstarter backers) are taking that role, it's important we feel we're getting value for our invested dollars. Fine and good. But I'm very interested in this as a sustainable business model. If Palmer is right and the project looks only to break even then that's not good enough. The Kickstarter becomes an event, not a repeatable model. In my opinion, Palmer and the people who work on this (her band, her artists, etc.) should be making money this way, because art needs to be sustained, not just one-off events, and right now we don't have a better way to sustain art than to compensate directly the creative people involved.
What Drew Wilson over at ZeroPaid has done in this past month is lay out in painstaking extensive detail just exactly what's wrong with the Cartel's propaganda-masquerading-as-science. The link above takes you to his conclusion piece and from there you can link back to the individual stories. It's a lot of reading, particularly if you want to read the original research - there are links to every published paper on which the analysis draws.
In science jargon what Wilson is doing is a meta-analysis. He's bringing together disparate research work over a period of time that examines multiple aspects of a single topic. Meta-analyses and meta-studies are in the news a lot these days as they tend to throw into question long-held assumptions such as the need/safety of hormone replacement therapy or PSA testing. Meta-analyses are also a good way to shed light on situations where there are conflicts of opinion and each side can bring some facts to support its claims.
In Wilson's meta-analysis he draws on studies ranging over the years 2004-2011. By taking studies from different periods of time, the analysis also helps guard against short-term trends. As we noted when LimeWire was shut down a couple years ago, significant events can produce sudden blips in long-term data trends. A meta-analysis should help avoid over-reliance on these blips.
Without stealing too much thunder from Wilson's work I wanted to quote what I think is the most important conclusion that can be drawn from this research:
[L]osses due to file-sharing are statistically indistinguishable from zero.
Winston Hide, the now-former editor, is a teacher at Harvard School of Public Health, and his resignation reasoning centered around his feeling that Elsevier's high-priced model was not compatible with the needs of people in developing countries. Hide, who is South African, has some direct experience with trying to do research on the continent where, he says:
The vast majority of biomedical scientists in Africa attempt to perform globally competitive research without up-to-date access to the wealth of biomedical literature taken for granted at western institutions.
Hide now plans to devote his time to promotion of open-access journals. He also notes that being on the editorial board of a prestigious journal is an important career position and resigning may in fact impede his career advancement. I still believe that the one true way to break the lock that for-profit publishers have on this business is for the tenure- and promotion-review boards of major institutions to change their processes, and I'm not seeing any movement yet in that direction. But it's still early, and academe is slow to change.
But lo, Harvard Book Store is back, under the direction of Jeff Mayersohn, who previously worked in high tech - Sonus Networks and BBN are both on his profile. And Mayersohn knows that Harvard Book Store has to be able to take on the Amazon challenge and win. So far, so good. Forbes reports "double digit sales growth month by month over the last year."
How's he doing it? Innovation and service. Innovation: he's using print-on-demand technology to satisfy customers' instant-gratification desires. "The Espresso Book Machine" as it's called has a built-in inventory of 5,000,000 titles and can be used for custom publishing. The output is high quality, and if you know what you want in advance you can even order your POD book on-line.
Service: you can get your POD book delivered locally by pedal-truck or bicycle, which appeals to the Cambridge-area green-conscious buyers. Know your customer is an ancient sales adage that Mayersohn has taken to heart. And if you go into the store you get:
fanatical attention to customer service with an unrivaled staff of passionate and educated booksellers.
Quick adaptation, a multi-pronged sales strategy, and an eye for winning details. Maybe it really does take a technophile to save a brick-and-mortar establishment. Are any other sellers out there paying attention?
The Mongoliad on offer here is a book - a collaborative work. But what's of interest to Copyfight is the structure and entity that produced this book. To quote Teppo:
[W]e formed a company whose goal was to realize a new paradigm in publishing methodology, and to promulgate an argument that transmedia empires could be built using small, highly agile teams that could shift direction quickly and efficiently based on customer need and reaction. Do more of what the fans like; less of what causes them to make the ‘meh’ noise.
To review quickly: a feature of the Copyright Act that went into force in 1978 gave record companies 35 years' worth of profits from albums, after which the artists would be allowed to reclaim their rights in the music. Several artists have done so, and the Cartel is fighting them. According to Larry Rohter's NY Times piece linked above, Willis's claim was contested by Scorpio Music and Can’t Stop Productions, who had sued to stop him exercising his termination rights.
As I discussed in the August entry, Scorpio and Can't Stop initially contended that Willis wrote works for hire, meaning that he would have given up all rights. Chief Judge Barry T. Moskowitz of LA's Federal District Court, appeared set to reject that claim so it was withdrawn. Now Willis has back "his share" of ownership in 33 Village People songs.
That "his share" phrase leaves a lot of wiggle room still because the judge has to determine what Willis's share is. There's going to be a lot of unpleasant tangles yet to sort on this one, but it remains significant as the first case to test termination rights and the work-for-hire theory.
(h/t to +Rowan McVey and +Network XXIII News for the original pointer)
Now comes Jon Mitchell on ReadWriteWeb, reporting that "Kindle Sales Plummet". He claims that sucks but I think he's exaggerating. Anyway, Amazon doesn't exactly report its sales of Kindles, so it takes a little bit of sleuthing to infer this. Mainly the inference comes from E Ink Holdings, which supplies the screens for Kindles, reporting that it had a quarterly loss due to a lack of orders from its biggest customer (aka Amazon).
At the same time, I'm interested to see that more publishers (of news, this time) are backing away from iPad-as-platform. As an MIT alum I got a notice from Tech Review that they are ditching their iPad app. The reasons are strictly financial - it cost a bundle and made no money - but it's a strong cautionary tale for people and organizations that are thinking about taking the Apple golden handcuffs. TR notes that the Financial Times also made a similar decision recently, and that both TR and FT have moved to a free/open model based off HTML5.
I feel like we're in the very early stages of a chess game - most of the things being moved are pawns, and people are just beginning to consider how they're going to achieve strategic objectives like "control the center of the board". I would not be surprised to see tentative moves and hanging back from most of the major players through the next 6-8 months as everyone waits to see how things shake out and what happens to early risk-takers.
She's also emphatic about another point, which you can read on the Kickstarter site: we lead, the media follows. If you're going to be successful in the independent model of the early-21st century then you make the news yourself. You do it by networking, word of mouth, taking things viral, making info in easily accessible places, in easily reposted (unlocked!) forms, etc. One way to look at this is as a failure of traditional media; another way to look at it as an opportunity for new businesses. There should be people out there setting up companies that are devoted to helping people like Palmer do this because, really, you need some kind of management when your sponsor base is over 10,000 and growing.
I thought this bit was particularly apropos:
I've seen people complaining that this is easy for me to do because I got my start on a major label. It's totally true that the label helped me and my band get known. But after that, the future was up to me. It bought me nothing but a headstart, and I used it. I could have stopped working hard and connecting in 2009. If I'd done that, and then popped up out of nowhere in 2012 to kickstart a solo record in 2012, my album would probably get funded to the tune of $10k...if I was lucky. There are huge ex-major label artists (pointless to name names) who have tried the crowd-funding method and failed dramatically, mostly because they didn't have the online relationship with their fans to rely on.
I was sadly amused to revisit the column today in preparation for writing this piece and find on the page the notice that "Comments on this page are now closed." I'm trying to formulate a coherent response that is not laughing out loud at the foolishness and backward-thinking-ness of a site that would close comments on a column, let alone close comments on a column that's not even a week old.
Dear Guardian, comments are lifeblood. You want them. You need them. See above, where I spend my time weeding out spam comments? That's because I treasure the real feedback I get from readers. I love that my first tentative query about Createspace is one of the most commented-on pieces on this blog, over four years later. Do you think Amanda Palmer would ever close comments on something she posted? I think not.
Get with the program, Guardian. You're not doing yourselves, your readers, or your writers any favors here.
First, Target isn't going to sell Kindles anymore. The problem isn't the Kindle per se. It's that Amazon has been using physical retailers as its (unpaid) showrooms. Amazon has encouraged people to go shop in physical stores, then price-compare and buy from Amazon - even offering a discount for doing so. That may be a few bucks in consumers' pockets, but it's a big hit to the brick-and-mortar retailers who are losing customers right out of their showrooms.
Target is still a small fraction of Kindle sales, even though it's the biggest non-Amazon seller. So this mostly amounts to a symbolic middle finger to Amazon, since Target will continue to carry iPad and Nook devices. It's worth noting that both Apple and B&N have large physical presences and as such are much more careful about how the online and retail shopping experiences merge.
Hernandez paints a picture of Amazon as "heavy-handed" and notes that many authors are opting for smaller publishers who offer more freedom and leave the authors more in control, such as Bookbaby and Smashwords. Harkening back to the first story, Hernandez quotes Smashwords founder Mark Coker as saying
KDP Select [is] using self-published authors as pawns [in] a broader campaign to wage war against retail competitors
That's another bad move on Amazon's part, but they're still the 500 lb gorilla in the room. Authors ignore them at some risk. Let's just hope the gorilla decides to be better-behaved.
(full disclosure: a couple of my author friends have chosen to go with Smashwords, but I have no incentive to promote that alternative. As noted, I don't even own an e-reader yet.)
One of the little-reported aspects of the current situation in academic research publishing is that much (most?) of the work that is put into these very expensive academic journals is paid for by the taxpayer. In the US there are funding agencies like NIH, CDC and of course ARPA that funnel taxpayer dollars to researchers. In the UK and elsewhere there are similar agencies and grant programs that make this research possible.
Given, then, that the work was paid for by the public it seems a wholly fair question to ask by what rights are the fruits of that work concealed from the public behind expensive paywalls. Wales acknowledges that academic publishers bring value to the process of research publication. However, adding value doesn't equate to having a monopoly lock. Or at least it shouldn't. The effort, dubbed the "Gateway to Research project", has about two years, and currently about UKP 2 million to create an open access environment. They're working with several partners in the UK, including representatives from academia, librarians, and publishers.
There are a number of thorny questions to be hashed out - it's not just as simple as moving research papers from expensive journals to a free Web site. How will research be accessed? How will it be vetted? What processes are necessary for updating or outright retraction of research? What other research materials might be valuable in such a portal - personally I'd like to see the inclusion of things like molecular models, part descriptions, software simulations, data sets, data analysis tools and much more. But can anyone make head or tail of this if it all gets dumped into one portal?
All of these are good and tough questions. Now the next question we want to be asking is: why limit this to just the UK? Where is the US effort?
(h/t Donna Wentworth... yes THAT Donna Wentworth for the pointer)
As the site notes, there has been slow progress on the de-DRM-ing fronts of the past. In particular, much more music is available for download unencumbered now than in the past. But the new fronts that have opened up - particularly ebooks and streaming music/video - remain badly broken and un-free for legal, private uses because of DRM.
DRM is bad business, and bad user experience. Let's get some attention on the need to make it part of the past.
In her letter this time she points out that even though the Kickstarter has blown the roof off its fundraising goal that still only represents a few thousand fans. Any major-label release that sold that few copies would be considered a flop, and the artist would make no money, never mind that a major label couldn't possibly manage to put out the kind of complex multi-pronged project that Palmer is fundraising for.
In response to yesterday's post, Luis Cruz asked the question of how well this model would work for someone who isn't already established with a fan base. It's a fair and unfair question at the same time. The answer is we don't really know - there are thousands of people trying to find their way through Kickstarter, maxing out their credit cards, busking, playing open mic nights, etc. A few will make it via each of these routes but most won't. But they don't have a lot of alternatives - the number of acts that will make it via the major-label last-century model is also minuscule.
Each year we see a few creative types that seem to break out (Jonathan Coulton, Felicia Day, etc.) and each has a unique path to present success. There doesn't seem to be a good general model, but I think we're starting to see certain elements in common. For example, intense fan service, a hawk eye on the business details, and a willingness to roll with the punches and adapt all seem to be necessary ingredients. Palmer's success didn't come overnight - Dresden Dolls formed in 2000 I think - which means she's busted ass for over a decade now. What she's doing now would not have been possible in 2000 but that says more about the Internet age than about Palmer.
On the Microsoft/B&N partnership, the blog entry by Tobias Buckell is typical of the reactions I'm seeing. Buckell's point, which I think is spot-on, is that this is not at all about a Windows 8 Nook. It's about the merging of two software ecosystems and the possibilities that opens up. And also that neither big entity seems to have concrete plans for how that's going to happen. Hell, they couldn't even figure out a real final name for their joint venture. This makes me think the whole thing was rushed and not necessarily well thought-out.
Above I mentioned "rolling with the punches." In particular I think a key element of this is being willing to re-invent one's self-conception. Day moved from doing standard television shows to running her own YouTube channel. Palmer has always had theatrical elements as part of her musical acts, but lately she's added spoken word, poetry, and art/photography. What makes me doubt that the MS/B&N merger will work is that I can't see either company pivoting quickly enough to re-imagine themselves in new ways. But a big bankroll buys you a lot, not least of it time, so I'm not willing to write them off entirely just yet.
Everything about this project screams 'forward-thinking': it's crowd-funded (via Kickstarter). There is an option for patronage beyond what Kickstarter allows. The project involves multiple artists, all retaining control of their work. The product is multi-faceted (album AND book AND art tour AND maybe more). The experience is multi-layered - even tickets to the shows are exclusively on Kickstarter. The promotion is direct and from the heart - Ms. Palmer is not ashamed to say "fucking" nor is she ashamed to express her love for her fans.
This is the sort of thing you can't buy with astro-turfing. This is the sort of thing that will blaze trails for this century's creative artists. I confess I am not a huge fan of Ms. Palmer's music and her stage acts. But I admire the hell out of what she's doing.
This seems like a bad and backward-thinking way for B&N to go, to me. As we've been discussing this month, dedicated e-readers are going to die, including Nook. Tablets running things like Windows 8 will replace these devices. Of course B&N wants there to be a Nook app for Windows 8. But it also wants one for iPad and Android tablets. Microsoft's money might get them first place in the development line, but it can't possibly buy exclusivity. B&N is also probably being foolish to prioritize a Windows-OS version, in that Windows 8 has such a tiny user-base. A Nook app for either of the other big sellers would likely reach far more of B&N's customers.
The PW piece has a bit of puffery about how they're going to do unspecified other things, and combine assets and blah blah. It includes blather about B&N's physical stores, about which Microsoft cares not one whit, and has not one word about the one truly revolutionary thing to happen in e-books this year: Tom Doherty imprints' decision to dump DRM.
All of which tells me they don't have an actual business model. That's kind of a shame, actually, because I can think of at least two that would be absolutely rocking, given these two companies' expertise and current footprints.
Stross has been careful to state that he had no insider view that Tom Doherty Associates - the publishers who put out the Tor, Forge, and other lines of books - were going to make a big move to drop DRM. But even without that knowledge, Stross put together what he saw as the business case for getting rid of DRM. Long-time readers here will know that I am a big fan of the creators should get paid viewpoint, but that we also share the view put forth by people like Cory Doctorow that the actual business effect of DRM is not to control illegal copying, but rather to hand the manufacturers of ebook readers a stranglehold on everyone and everything.
It's not going to surprise any of my readers that Stross concludes that the only way to break Amazon's stranglehold is to drop DRM. In a DRM-free world, you can buy a book that is readable on a Kindle and on a Nook and on an iPad. Thus, it doesn't matter if you buy that book from Amazon. It may be the case that Amazon offers you a discount, or a frequent-buyer program, or some other incentive. The publishers can't guarantee that Amazon won't be able to dominate the market by virtue of its strong competitive position, wide inventory of products, and other advantages. What they can guarantee is that their readers will no longer be locked into a Kindle.
Although Stross doesn't say this directly, I feel this also opens up a world of other direct-sale opportunities for publishers. I mentioned Emily Books a couple weeks back, who are trying to operate as independents. In a DRM-free world there's no reason that a big-name publisher can't do a deal with Emily Books or any of a thousand other small, high-value, curated ebook outfits. Get DRM-free versions of Emily Books on every device, with a publisher like Tom Doherty Associates lending its marketing and mass distribution expertise and getting a cut of the profits. I can think up at least six more profitable-to-the-publisher ways to build business in a DRM-free work. Stross's piece claims that dropping DRM won't lead to immediate revenue gains, but I think that's true only if you consider going DRM-free as a stand-alone action rather than part of a comprehensive business strategy.
I was also amused to see that Stross also predicts the demise of the dedicated e-reader, given that most people I talk to think I'm nuts when I say that. He's more generous than I was, giving the stand-alone reader "2-3 years possibly, 5 years probably" where I think that by this time next year everyone will be talking about the decline of the device as tablets ascend.
Lastly, I wanted to bring to your attention a fascinating piece that appeared yesterday on PaidContent, '"Why I break DRM on e-books”: A publishing exec speaks out.' In this column, Laura Hazard Owen tells the story of one (obviously anonymous) executive from the publishing industry whom she introduced to the common practice of unlocking a purchased book so it can be read anywhere.
Exec, as she dubs her story protagonist, admits to being influenced by Stross's writing. Exec realized that s/he had no control over the ability to do perfectly legal things with purchased ebooks. Exec isn't sharing the cracked books with anyone, let alone putting them out for general downloading. Exec just wants to be able to read the stuff, and has figured out that the sole purpose of DRM is to control the consumer. Sadly, even though Exec admits to a decision to break every DRMed ebook from now on it doesn't appear that Exec will do anything to change stupid corporate policies that put the DRM there in the first place.
Still, admitting you have a problem is the first step to recovery, right? Maybe we should set up a 12-step program for all the members of the Cartel who are addicted to DRM.
To review: academics who publish provide free material and free labor to big publishers like Elsevier who take this free material and package it into things like journals that are then sold at great expense to places like libraries. And by "great expense" I mean tens of thousands of dollars per journal per year. More on that below.
Often, to be published requires not just giving up your time and energy but also all kinds of rights on your own writing. Some academic publishers will, for example, forbid authors from having copies of their own papers on their own Web sites. Sometimes you're not allowed to submit the entire body of your writing to a scientific indexing service, just an abstract. Both of these hurt authors by making their work harder to find and read, but bring more revenue to the publishers who charge for things like reprints, access to their walled "digital libraries," and so on.
In his column, Naughton reviews the costs, power structures, and "intrinsic absurdity" of the academic publishing racket, pointing out among other things that at least one estimate of the free labor provided for peer reviewing states its value at over UKP 165,000,000. He notes that Tim Gowers' petition is but one of many gaining traction and that even some research-funding bodies are beginning to require that people who accept their funding agree to publication that isn't behind a paywall.
About that "pay" bit... Boingboing recently highlighted a letter from Harvard Library's Faculty Advisory Council. In it, the Council expresses the view that the costs of these journals will soon put the library out of business. Remember those tens of thousands I mentioned? They add up really fast, particularly when you want to run a world-class research library for a multi-disciplinary faculty. Harvard (or MIT or Boston University or Tufts, just to name four world-class institutions close to where I sit) doesn't just have to keep in the high-prestige journals in biology. They also need the journals in mathematics, physics, chemistry, astronomy, computer science, mechanical engineering, and on and on and on. They don't have the option to leave out some.
The result, at least in the case of Harvard, is an annual cost just for journals of USD 3,750,000. That doesn't count access fees, reprint fees, and other costs. And the memorandum points out that the rate of increase in these costs far exceeds other measures such as the rise in tuition costs, inflation, and so on. In plain English, the publishers are gouging ever harder.
So, where does that leave us? Libraries are grumbling, funders are disquieted, and individual faculty members are happy to sign petitions of protest. But none of this addresses what I see as the key issue: faculty give these journals this much power because they rest entire careers on them. You get tenure based on your academic publications. You submit your publications list when you apply for grants and funding. Look at any academic C.V. and you'll see that it's structured so that the big name journals in which the person has published are listed promptly. It's one of the first things that gets looked at when someone applies for an academic job.
Until that changes, nothing is going to change. I'm sorry to be so consistently negative but "publish or perish" is still the law of the ivory tower.
A quick follow-up to yesterday's long discourse on why Twitter's IPA is doomed. Part of the analysis of why is my differing opinion on how good engineers think. Today I direct your attention to "Why I joined Microsoft" by James Whittaker. He's been at MS, left for Google, and has now gone back. In the blog he explains why, including his view that MS is where he can "find work [to] be passionate about." Oh, and it "has the right collection of IP, product segment leadership and technical assets to be a disruptor." That is the calculus of a senior developer who's been in several environments and has his choice of where to work next. If you want to fashion an intellectual property agreement that is going to change the game, you need to understand the people whom you expect to sign that agreement.
Start by reading the agreement as posted to Github. There's a lot of discussion around it, and the specific language will likely change, but the basic agreement is very short and readable. It is intended to replace the default blanket assignment that is used in most industries. In the default you give the company everything, and they can do anything with it. Your name still appears on the patent, but you assign all rights to your employer - usually as a consideration of employment, meaning you can't work (at tech, bio, pharma, or any other IP-using company) unless you agree to this.
The company then is free to use the patents however it wishes. You may recall that this was the topic of some outrage about a month ago, when Andy Baio complained bitterly in a WIRED piece about how Yahoo was using patents (not his, keep in mind, but he was upset anyway). This freedom is restricted under Twitter's proposed IPA, which specifically limits companies' ability to use assigned patents to what the IPA calls "Defensive Purposes."
In theory, a company with this agreement in place could use patents to defend itself, but not to initiate patent-enforcement action. That's a nice theory, but there are two problems I see with it. The first, and smaller problem, is that the way the language of the IPA currently stands, it permits IPA-covered patents to be asserted
against an Entity that has filed, maintained, or voluntarily participated in a patent infringement lawsuit against another in the past ten years
Which is to say, everybody. Really, if you can name a going tech/bio/pharma concern that hasn't been involved in patent litigation in the past 10 years I'll be shocked. It's probably not 100%, but it's certainly 80% and all the big players are in those 80%. So unless the IPA's language is changed, its effect will be nil.
But leave that aside for the moment, and consider what it means to be a publicly traded corporation. It means you are legally bound to do whatever increases shareholder value. Voluntarily disarming yourself in this way leaves you at a competitive disadvantage against other players in your marketplace who are free to infringe your patents, so long as they don't sue. Can you imagine trying to go before your biggest shareholders and say "Well, yes, I'm going to allow our competitors to continue infringing all these patents even though we think we have a good legal case."
You'd be fired in a heartbeat, and with very good justification. You'd be lucky if you didn't find yourself on the wrong end of a shareholder lawsuit. Private companies can get something of a pass on this kind of thing as they don't have the same legal obligations to shareholders. In addition, private companies can be much more easily molded to the personalities of the founders and controlling early stakeholders. But big public companies? The Apples, IBMs, HPs, GEs, Genzymes, Motorolas, Honeywells, etc? They're all going to continue to use patents offensively to protect their markets and products. I hear Google used to be a not-evil place, too.
The IPA is not an inherently bad idea. I applaud Messinger and Twitter for thinking innovatively and trying to get something new started. But I think that the press are being vastly overoptimistic about the likelihood of success here; for example, see Joe Brockmeier's piece.
He lists four reasons why companies should adopt the IPA, which come down to hoping a lot. #1 is that developers will prefer to work at an IPA-using company. I'm sorry but 99.999% of developers don't think about patents and certainly don't think about them during the hiring process. Developers go where the work is interesting and the pay is good. Developers go where they get to do stuff that's fun and looks good on their resumes.
Number 2 is that companies won't need incentive plans to convince developers to file patents. I take it from this that Brockmeier has never filed a patent. The process is BORING and TEDIOUS in the extreme, involving hours of meetings with lawyers who don't understand your work and who insist you do all sorts of annoying arcana. Incentive programs exist because companies realize that developers hate this stuff, but hey for five thousand bucks they can get a really cool new toy so sure, they'll put up with the annoyance. The future use of whatever comes out the lawyer's pen is not even part of the consideration.
Number 3 - it could reduce the number of trolls, but frankly trolls are an overblown annoyance. They're a pack of fleas on the ass of the bull that is rampaging in the tech china shop. The bull is composed of those very same big names (IBM, Apple, HP, Microsoft, etc) aided and abetted by a thoroughly broken patent system. I think Mark Cuban gets overheated at times, but I definitely understand his visceral desire to burn down the entire broken edifice that is software patenting right now. Patent trolls are a symptom, not the disease.
Number 4 - the IPA can be a poison pill. Which is to say that if you're someone like AOL or Yahoo and your company is collapsing then you can't even scrape a bit of value out of what little you have left. Boy, that's attractive! I'm about to default on my mortgage, so I'll set my car on fire, too! Seriously, who thinks like that?
The press needs to take a much more realistic look at this proposal and talk about the ways in which it can be made more workable. For example, I'm personally a fan of patent pools, in which companies contribute mutual value, take mutual value and have financial incentives to avoid hostile legal actions. IPA-like agreements and additional steps like compulsory licensing could play a big part in creating an environment where nobody gets everything, but everyone gets enough to be satisfied, without having to disarm themselves.
In a New York Times piece, David Streitfeld notes that Amazon has already announced plans to "push down" e-book prices. Of course, the problem isn't what happens in the short term, it's what happens over the longer term. There continue to be two diametrically opposed opinions on this. On the one hand, we have the old-school notion that says monopolists will raise prices no matter what - the view argued by those who didn't settle with DOJ. I continue to find this ironic after Apple's history of holding the line on music prices against publishers who wanted to charge far more. On the other hand, we see independent authors like Konrath who argue that sales are extremely sensitive to pricing and monopolist price-jacking will just cause people to switch back to physical books.
There is already a potentially significant price gap in the (retail) costs of e-books and physical books. To the degree that a consumer has a choice - that is, already owns the e-book device - the price gap has to matter. For consumers who aren't already locked into a device, the gap has to be factored against the cost of buying a new device.
A possible third way could come from small e-booksellers, according to a Time Techland piece by Keith Wagstaff this week. Under the two very photogenic ladies from Emily Books the column points out that for all the hand-wringing over the potential power Amazon will have, nobody at the big publishers is actually doing anything about it. Hopping into bed with Apple isn't precisely a great move, but nobody at the big houses seems to have a better idea.
Emily's idea is to offer a high-touch hands-on approach, giving readers a better idea of the quality of what they're getting. It's a simple model, and one that has been replicated with all kinds of specialty brands and products in all kinds of industries. But it's nearly impossible to do with e-books because the publishers are so afraid that they won't let anyone sell their e-books without massive, complicated, and expensive DRM.
Wagstaff devotes more than half his column to excoriating the idiocy that is DRM, a story that I'm sure most Copyfight readers know by now. He ends by saying:
DRM requirements are going to have to go. It’s probably going to happen eventually; if I were a publisher, I’d get ahead of the curve and embrace a more diverse marketplace sooner rather than later.
Oh, would that the big publishers were so willing to dip even a tiny toe into the 21st century.
The point these two are making is that antitrust regulators are looking at the wrong thing. Sure, agency pricing set up by collusion would be illegal, but it's not half so anti-competitive as the kinds of platform locks that DRM and other restrictions the DOJ is giving a pass to. Carmody points out that Apple also employs a variety of anti-competitive measures to lock customers in. And, as I'm getting sick of saying and you are probably getting sick of hearing, every bit of lock-in is going to end up harming the marketplace and harming readers particularly.
Yeah, I get that e-books have lots of advantages. I'd like to get some. But not at this cost - and I don't mean whatever Amazon decides to charge.
I feel compelled to repeat before I light into this that my personal belief is that the current construction of copyright law in the US is far too tilted in favor of maximalism, by which I mean putting the rights of copyright holders above other considerations such as scholarship and the general welfare. It was obvious to me that SCOTUS would see how Eldred should be decided, and how continuing to extend at whim the term of copyright violated the originalist language of "for a limited time." As the man said, I may have been (on the) the losing side. Still not convinced it was the wrong one.
What I am convinced of is that Eldred remains the current settled law of the land, and that officials such as Maria Pallante, the Register of Copyrights, have a duty to follow and uphold the law until such time as it's changed. Let's not forget this all started with Masnick hyperventilating about how her statements in favor of copyright maximalism made her incompetent to do her job.
Now let's look at Masnick's current long screed. Without delving into too much detail what he seems to be harping on is the distinction between 'purpose' and 'method.' He still asserts that the purpose of copyright is contained it its preamble language, and that the methods should serve that purpose and that's what everyone else should believe, too, or they're wrong and he's right. This is a less well-written version of the Breyer test and I really do recommend that you, and Masnick, go reread that opinion. Breyer's writing on IP matters is not always good enough or clear enough, but in this case I think he makes the argument cogently and persuasively. But as we reread, let's keep in mind Breyer was writing a minority opinion. Breyer's side didn't win that case (Golan v Holder) and thus it is not the law of the land.
Masnick seems to think he can bolster his argument with a "bunch of quotes" (his words) that support his view. Dear Mike Masnick, I can personally guarantee you that every losing side in every SCOTUS case came equipped with more than a few "quotes." They had amicus briefs, and detailed citations of precedential cases that they believed supported their side. Having a bunch of quotes doesn't make you right and the other guy wrong.
With very little due respect to Chief Justice Roberts, the job of a judge - particularly a Supreme Court justice - is a hell of a lot more than just calling balls and strikes. It's weighing meanings, and examining evidence that supports potentially contradictory interpretations and deciding which one is right. Precedents exist, but may not apply. Or someone else may read that precedent differently than you read it. If you read a dissenting opinion in a Supreme Court case you may find language that says, in effect, "those other five guys are wrong." Justice Scalia is known for taking his colleagues to task in his minority opinions for, in his view, being wrong. He does this in great detail, with extensive citations and as much weight of authority as he can bring to bear. But that doesn't make him right - the majority opinion remains the majority opinion and thus the governing interpretation of our laws.
Which is to say, you can't just pick a few quotes that support your opinion and then say, "See, this means the law says what I think it says." Well, apparently if you're Mike Masnick you can. But I'm still going to laugh at you for doing it.
Over a year ago, I pointed out that a potentially big story was being missed: people were migrating off file-sharing networks because of a change to always-on, high-speed, mobile Internet use that meant people would rather have their media streamed to them wherever they were, rather than held as bits on a single disk. Having media in the cloud was worth more than downloading, legal or illegal.
But never mind all that interesting new stuff, the RIAA has its own version of history and it's going to stick to that version no matter what. In a blog entry posted last week, Joshua Friedlander, the Cartel's VP of "Strategic Data Analysis," trumpets their success at smashing sharing networks. He's not just relying on marketing "research" like last time, he's relying on a truly dreadful paper put out by an actual (Wellesley) college professor.
To highlight just one critical flaw, I call your attention to the methods used, which involve looking at results data (the change in purchases from iTunes) and then inferring what caused those changes. Rather than doing something like asking people "why are you buying more music" or investigating things like public awareness, Professor Danaher simply assumes the counterfactual. If sales went up, it must be because of Factor A. Shame on him for bad experimental design, and double shame on Friedlander for citing this paper as if it was actual published work. It's not, it's a "working paper" which means it hasn't been subjected to the kind of peer review that would highlight methodological flaws. Two words, Professor Danaher: confounding factors.
Friedlander also points to "Nielsen Netview data" (which I could not find the source for) in order to tell us that "the vast majority of those who used Limewire in September 2010 did not use it in September 2011." Could that possibly be because Limewire was shut down in October of 2010? So, a year after a service was shut down, 90% of people had stopped using it. That's a remarkable achievement; next, do a survey on how many people are renting DVDs from Blockbuster.
Also shocking is that if you mention Limewire, and then ask people whether they use other sharing sites, they tend to say "no." Could that be because people are not stupid? Seriously, I'm more surprised that 35% of people who used to use Limewire would admit to migrating to another file-sharing network. Brazen is as brazen does, but no, officer I promise never to speed again. Honest!
First, the practical response. Dearauthor.com has a very nice (if lengthy) guide to "What happens next?" It's complicated, in part because some of the publishers accepted a settlement and some rejected it. So what happens with your e-books (both as an author and as a reader) depends on who the publisher is. Also bear in mind that the settlement doesn't yet have the official court stamp of approval, which could take as much as 60 days to get.
For example, it's quite likely that those publishers that signed the consent agreement will quickly negotiate new agreements with Amazon, which still has a dominant position in the e-book market. Because of the terms of the agreement, books will appear in Amazon's Marketplace at variable prices. There will be an ability to discount, to manage prices, and I suspect Amazon will not pass up the opportunity to promote its (re)acquisitions, possibly with sales and offers. If you were holding off on buying some e-books because of pricing in the past few months now is an excellent time to start scanning for bargains. Assuming, of course, that your preferred books are published by certain publishers and are on your locked-in platform. But I digress.
Dearauthor seems to think that the prices on physical books are due for another rise, and that the entire concept of a mass-market edition is at risk. I generally agree, but don't think it will happen this year, for reasons I think will become apparent as 2012 unfolds, particularly the end-of-year shopping/gifting season.
To wit: I believe that the dedicated e-book reader may well have plateaued already. In 2013 I think we'll start to see the dedicated e-reader go the way of the point-and-shoot camera as tablet computers start to become less pricey and expand their reach and function in accordance with some version of Moore's Law. Just as peoples' mobile phones took over every function that a point-and-shoot had, tablets will do everything that e-readers do. Yes, phones and tablets cost more, but people want mobile devices for other reasons and once you have those devices you don't want or need a second single-purpose device. In the mass consumer electronics market, special-purpose hardware tends to lose badly to general-purpose hardware. Your set-top box is a DVR (and maybe a DVD/Blue-Ray player too). Your home movie camera is called "iPhone" or "Droid." Et cetera.
E-book readers will not be immune, and their demise will shake up the market significantly. If Apple continues to be this hostile, what will be the fate of a "Kindle app" for iPad? Will Apple even allow such an app in the store? Disruption of this sort always hurts consumer adoption, as does a failure to converge to a single standard. A slowdown in consumer adoption of e-readers may well delay the demise of the mass-market paperback, at least for a year.
To close out the Dearauthor piece, I think they hit the nail on the head where they say
[P]ublishers have sustained a big public relations blow. People who never read an ebook or haven’t followed this issue closely now are exposed to this idea that publishers stand accused of engaging in price fixing
Fulton makes a couple good points, the first of which is that Amazon's behavior in arousing the book publishers' ire is remarkably akin to what Apple itself did with its iTunes store pricing. Jobs wanted a certain price for songs and he got that price. The music publishers fumed and fought and flailed but 99 cents it stayed. His other point is that the publishers (and Apple) who are fighting the suit may be in position to counter at least the prima facie evidence of collusion that the government seems to be making its case on. Whether that's a wise move is still debatable. Making yourself look bad in front of customers is rarely a winning strategy.
Finally, In delightful counterpoint to Jon Sargent, we get US DOJ (acting) Antitrust Chief Sharis Pozen claiming that the point of the settlement is to "[open] up the competitive marketplace and the competitive landscape." So now both sides claim they're all about open competition - isn't that wonderful? And that brings me to John Scalzi's Whatever column published yesterday in response to the public drama. As he points out, all of the players here are in it for their own (and their shareholders') pocketbooks.
You, and me, and those who read or might read e-books are here solely for the purpose of giving these companies money. That's what they're in business for. Statements about the public interest, or open competition are just part of the PR maneuvering game. Corporate strategies have everything to do with profit and nothing to do with "good" or "evil." Really.
A couple months ago, Nest found itself on the wrong end of a patent-infringement lawsuit from Honeywell, over so-called smart thermostats. At the time, I thought that Nest would probably choose to settle rather than get dragged into a possible protracted bit of litigation against a much-bigger company. Honeywell makes tens of thousands of products and smart thermostats are a tiny fraction of their business. For Nest, though, they're the showcase - the whole point.
This morning, Kate Brinks (the official Press Contact for Nest) was kind enough to send me a copy of Nest's just-filed response. It's dressed up in polite language, but what it amounts to is Nest calling "BS" on Honeywell, and filing its own counter-claims. In order to lead this fight it has brought on board one Chip Lutton who hasn't even had time to update his LinkedIn profile there. See, he's left Apple and joined Nest as Chief Counsel. This is very good news for Nest, I think, as Lutton has been helping steer Apple's worldwide patent war and knows a thing or two about how big companies do the patent dance.
So, what do Lutton and Nest have to say in response to Honeywell's charges of patent and design infringement? It's the usual - Honeywell are stifling competition, their patents are "hopelessly invalid" where they are "not worthy of a patent". The deep deep irony of someone from Apple complaining that someone else is asserting crap patents is apparently not a factor in drafting press releases like these. In summary: Nest are going to challenge the patents' validity, push for re-examination, and hope that the judge finds that they have sufficient grounds to proceed. If the judge thinks they have even a reasonable chance then it's likely they won't be hit with an injunction and can go on building their business.
If Honeywell is able to convince a judge otherwise it's possible Nest could be cut off from its sole source of revenue, which would make its investors even less happy. My guess is that Lutton's first job is to make sure that doesn't happen. Whether this leads to serious negotiations or to a courtroom date afterward is something we probably won't know for many months.
Quick recap: the DOJ has been hinting about filing this thing for at least a month. The core charge is that five big publishers colluded with Apple to fix prices via an agency model for e-books. According to the WSJ piece, the civil suit alleges that the publishers banded together by phone and email to break Amazon's back over its "wretched $9.99 price point."
The new news is that three of the five would rather smoke than fight, agreeing to a settlement that will let Amazon resume discounting e-books. They may also have to pay "tens of millions of dollars in restitution " to consumers who were ripped off by the illegally priced e-books, settling a separate suit brought by a group of states. Apple and two of the publishers didn't like DOJ's terms and will do the "see you in court" routine.
The first part of that routine is, of course, trying one's case in the press. DOJ tries to make its case look as strong as possible, and the defendants respond by denying guilt and making charges about government interfering in good ole American business. If that's what Sargent wants to do he needs a better writer - maybe he knows a few?
See his blog post on tor.com (Tor is owned by Macmillan). In this triumph of illogic he claims that switching to the agency model would "make less money on our e book business." Say what? You jump prices 30% overnight and make less money? Either you're not fit to run a business or something very fishy is going on. Trust me, if I'm hurting trying to sell a product for $9.99 and tomorrow you let me sell it for $12.99 and prevent anyone from discounting it back down? I'm going to make more money.
Unless, somehow, you think the 30% price jump is going to kill your customers' willingness to buy that product, in which case you are a frakking moron for jumping the price in the first place.
Moving on, we then get the claim that "We made the change to support an open and competitive market." Would someone like to tell me how a price-fixed, guaranteed-no-discounting market is more "open" or "competitive" than one that lets prices vary? Oh, never mind. This is code for "we found a way to force people to buy our stuff at the price we wanted and from the people we want you to buy from, who are not Amazon."
The best part is the personal story: "I made the decision on January 22nd, 2010 a little after 4:00 AM, on an exercise bike in my basement." Dude, if you're deciding the entire future of your business at dark-o'clock when you can't sleep then you need to take a big step back, and maybe step down. The corporate cowboy routine may play well if you're Mark Cuban or Donald Trump, but (even though your company is privately held) there are people who depend on a management team making responsible, well thought-out decisions. Preferably not at four in the morning.
This is more technical than my usual pieces; please bear with me and remember I'm still not a lawyer, just doing my best.
The decision last month in Mayo v Prometheus was either good or bad, depending on which side you stand for. Organizations such as the (generally liberal) ACLU, the (generally libertarian) Cato Institute, and the (generally non-politically aligned) AMA were all pleased by the ruling in Mayo's favor. Biotech/pharma companies were dismayed. But there's a third group, nominally neutral in this particular dispute, who have to deal with its consequences: the patent examiners who have to decide what they should and should not allow as patents and the applicants (and their attorneys) who have to construct patent applications, draw defensible claims, and secure the patents that the SCOTUS decision should enable.
To the dismay of this third group the majority decision, written by Justice Breyer, is causing more confusion than clarity, as has happened with several recent SCOTUS patent decisions. Greg Aharonian's PATNEWS published a letter this month from an anonymous group of examiners in the USPTO's "biotech Art Groups" - the people responsible for making judgments of patent applications in light of this decision. And they are not happy people.
It seems that Breyer's opinion confuses 35 U.S.C. 101 and 35 U.S.C. 103. That's two key sections of US patent law covering the requirements for an invention to be patentable. See the Wikipedia entry for a mostly non-legalese discussion. The actual (sparse) legal language can be found at sites such as Cornell's Legal Information Institute.
Taken as a whole, a non-patenting outsider doesn't care about these distinctions. Either something is or is not covered by a patent and it doesn't matter why unless you plan to challenge the patent somehow. But the people who are involved in practicing the law care a great deal about these distinctions. An invention may be rejected on 101 grounds or, separately, on 103 grounds. Challenges to patents, or to specific patent claims, can be brought under different sections of the law, and there are different requirements in each of these cases
And let's not forget that none of these things is free. Patent examiners always have more work to do than they can handle; if they reject wrongly and have to re-examine then they've taken away time that could have been used to examine another patent, which harms them and the long queue of waiting applicants. Patent applicants have to pay lawyers, court costs, their own time, etc., none of which are cheap. Getting 101/103 wrong can cost a lot of money, so it really matters if Breyer's opinion has messed this up.
Specifically, the patent examiners say:
[T]he decision never says what the natural laws are in the claims or how the claims are simply an application of the natural laws. The starting material and product are not naturally occurring. How are we to justify saying something is or isn't simply an application of a natural law?
The point of novelty in the patents (Applicants' discovery) seems to be that a therapeutic amount of the drug is one that produces an amount of the metabolite in claim 1 in the blood within the range recited in claim 1. [...] Determining this indicator (metabolite range) may or may not be an invention. But that determination is better treated under 103.
We don't know what the PTO can do with this decision, because no examiner thinks like the Supremes.
The 101/103 distinction revolves around what is eligible to be patented with 101 criteria supposed to govern novelty and usefulness versus 103 criteria governing (non)obviousness. That is, even if you've come up with something new and useful, if the invention was obvious you still may not be able to get a patent on it. What Breyer's opinion seems to be doing is stating that Prometheus's patent is invalid in part because of the use of "natural laws" (which might be read as a 101 objection) and in part because the result (of reading the metabolite level) is obvious - to a person skilled in the art, remember.
But if natural law applications fail for obviousness reasons then... um, what's the point of having 101 and 103 be separate? The examiner writing above seems to be making the point that the Supreme Court majority is written as if by a layperson who doesn't care about the 101/103 distinctions, but has to be treated as law of the land by patent examiners who care very much about this.
No wonder they're tearing their hair out.
(Excerpts and quotes above taken from PATNEWS by kind permission of Greg Aharonian of Internet Patent News Service and publisher of PATNEWS. The newsletter itself has no online site, but you can subscribe at http://bustpatents.com/)
Yesterday, the Second Circuit handed down its decision, which is something of a mixed bag. The trial court had pretty completely sided with YouTube, in a way that felt like a complete victory for safe harbor. The Circuit decision is more mixed: in part they upheld, in part they overturned, and at least one key question has been remanded back down for further argument.
As I see it there are three key elements here: Does safe harbor apply? Who is responsible for finding infringing content? What must be done when infringement is claimed? YouTube clearly won on points one and two and the third will need to be further argued.
As Post points out, the Circuit's finding is that a safe harbor site such as YouTube is protected from all infringment claims, including contributory infringement, inducement, and so-called "vicarious" infringement. In addition, the Circuit clearly assigns the responsibility on the claimant, not the hosting entity, to determine specific infringement by content. The Cartel's theories about pre-filtering and keyword matching fall. Takedown notices may still be subject to abuse or over-use, but the responsibility for generating notices is still there, an important victory for YouTube.
The issues on which YouTube lost, and which are now remanded down for further argument, deal with what steps it (and similar safe harbor-protected) entities must take when made aware of infringement allegations. The Circuit clearly ruled out what's being called a "willful blindness" defense - that is, YouTube can't shield itself from knowing about infringing content. And, it must "act expeditiously" to remove or prevent access to content that is claimed to infringe. There's also an unresolved question of what the Circuit called "substantial influence" and some question about syndication of allegedly infringing content. These issues will now be re-argued at the lower court.
Matters of fact-finding, such as the Circuit required to be resolved, will vary from case to case. What is important here, I think is that the Circuit has affirmed the overall structure of safe harbor policy, clearly rejected attempts to drag in other sorts of copyright-infringing activities, and begun to articulate what may become a recognized standard for what actions a safe harbor-protected entity has to take. That's not a complete vindication of either side, but the scales I see are definitely tipped in YouTube's favor.
Let's start with a couple things we agree on: Maria Pallante, the Register of Copyrights, is a copyright maximalist. As you can see from her public background, she's worked for organizations like the National Writer's Union and the Guggenheim Museum that consistently hold a maximalist, and author-centric view of copyright. It's also clear that she believes the purpose of copyright is to help people make money, and that exceptions to copyright monopolies should be narrowly drawn.
Why this is surprising, or why it causes Techcrunch's Mike Masnick positively to foam at the mouth is beyond me. Masnick notes that in two recent talks she's taken a retrograde and maximalist position, and then goes on to rant that this means she "doesn't understand her job" and that holding such views should be "grounds for termination."
Beg pardon? Since when has the Copyright Office been any bastion of progressive viewpoints, or even vaguely friendly to "the copyleft agenda" - whatever that might be.
Masnick's major point seems to be that he thinks the purpose of copyright is to promote some nebulous social value. If the head of the Copyright Office seems to think the purpose of copyrights is to make money for the rights-holder that's kind of disappointing and unenlightened, but hardly a shock. Masnick seems to be referring to what I've been calling "The Breyer Test", but hasn't noticed that Breyer was writing a minority opinion.
It's an opinion I happen to agree with, but it's still the minority opinion. What Pallante is reflecting is the majority opinion, which is to say the settled law of the land. So we have a high government official saying she agrees with the law of the land, and this is cause for ranting... how? I dunno, Techdirt is a better (or at least more popular) blog than Copyfight, so maybe I should write more rants and less reasoned posts.
It's also Facebook's way of saying "let's negotiate" - they're showing that they can bring weight to the table, which puts them in a better position to make the whole thing go away. Neither company can really afford this: Facebook does not want its multi-billion-dollar IPO disrupted and Yahoo can't afford to pay for a protracted patent struggle. Cross-licensing these 20 patents (and probably whatever else they've got lying around) would strengthen both companies' positions.
I also expect Facebook to throw Yahoo a bone, like paying their legal costs for this.
There, two servers were seized - servers alleged to be "the command and control computers of two Zeus botnets". As you may know, a botnet is a network of computers (usually PCs running Microsoft Windows) that have had vulnerabilities exploited to allow remote attackers to gain control. Once in control the subverted PCs are made part of a network (botnet) that can be used for a variety of illegal purposes, including DDOS attacks, spamming, spreading worms/viruses, and crack/infiltration attempts against other machines. Usually in a botnet each member PC operates independently but periodically checks with controlling servers for new instructions, updated malware, and so on.
The Copyfight angle appears to be that Microsoft made the assertion (and presumably convinced a judge) that it was entitled to enforcement action against these Zeus botnet servers because one effect of the botnet was to "violate [Microsoft] copyrights and trademarks" by taking over the Windows PC. It's an interesting twist but one I haven't seen before.
I'm a little bit conflicted here - I don't generally think that ends (even good ones like silencing botnets) justify means, including potentially novel expansion of copyright and trademark enforcement. Looking back in history (e.g. see this story from Sept 2011) it appears that Microsoft has used other means in the past to move against botnets. So this may be a new tactic in their ongoing fight, or it may be just new-to-me. Does anyone know if this is truly a novel application of the law?
If you think that traveling with comics (or manga) isn't a big deal then you haven't been following the news these past few years. People have been stopped, denied entry, had their possessions searched and seized, and even been brought to trial over these kinds of materials. The rights you may have in your home country (particularly if you live in the US or Japan) may be very different from the rights you have on entering another country, even a democratic nation such as Canada or an EU member state.
The CBLDF page contains a set of links to guides on four specific topics, covering comic art, pornographic anime/manga, electronic devices, and US border privacy. Each is worth a read and as always if you have questions make sure you talk to a lawyer - these are advisory notices based on experience, not legal guidance.
As Scott Fulton explained for ReadWriteWeb, HBO managed to get itself known now for having a young college student handcuffed and dragged away by local cops. This student - Cristian Alvarez Rojas - is apparently accused of being behind a site called Cuevana.tv which itself is accused of being a violation of a relatively new (April 2010) local intellectual property law. Except that Rojas may not have broken the law because he kept the site's resources outside of Chile. The law may not cover this situation.
It's unarguable that Chile, like much of South America and vast swathes of Asia, does not have respect for American copyrights. Illegal copies of videos are sold in the streets or in cheap storefronts in Chile as they are in China. Police efforts to crack down on the retail end have proven largely futile. The argument, though, is that these street copies are made from downloads provided by sites like Cuevana.tv. Even though the site isn't making Rojas any money, if it is a source feeding the illegal retailers then it's clear why the Cartel would want it shut off.
But having a college kid dragged off in handcuffs is bad juju and horrible PR, regardless of how accurate or justified the reasons behind the action may be. Just like extraditing a kid from the UK is a terrible move but the Cartel seems bent on doing it anyway. Legally right != smart, guys. The people who are buying those street-copy DVDs are your natural customer base. Do you want them to think of you as 'the strong-armed gringos"? Do you think that being known that way will help sales of your legitimate product?
I certainly don't. But then I doubt anyone from the Cartel would ever hire me anyway.
What do the US Supreme Court, the ACLU, the Cato Institute, and the AMA all have in common? Today the answer is: "unanimous opposition to the notion that mental processes constitute a violation of a patent, or are the proper subject of a patent."
Lee, who has written about this case for Ars before, played a small part in the Cato institute amicus brief, and is a strong advocate for the invalidity of the patents. I have not yet read the opinions in the case, but based on the summaries I believe I would have to side with Lee and the other amicus parties. To put it bluntly, this looks ridiculous on the face of it and it's not clear to me why the patent was issued in the first place, or why the lower courts upheld it.
The key issue appears to be that the Mayo Clinic decided to stop using Prometheus's product and started doing its own testing; in response Prometheus argued that in using the separate Mayo test doctors would still "[think] about the correlations described in Prometheus's patent" and that this would itself constitute infringement. SCOTUS disagreed, asserting that the activities of measuring thiopurine metabolites and from that determining appropriate drug dosages was, in the words of Justice Breyer, "well-understood, routine, conventional activity previously engaged in by scientists who work in the field." And thus, unpatentable.
Unfortunately, although I believe this decision to be correct, I do not think the verdict is going to do much to untangle the present snarl of what is or is not patentable in the US. It has become increasingly clear in the past decade that decisions such as in re Bilski have done nothing to clarify what ought to happen. Instead, the waters have gotten more and more muddied.
The court rejected Righthaven's claim that online excerpting was copyright-infringing action, and also noted that a site which permits user comments is not automatically liable for material posted in those comments, even if the site is not a formal candidate for DMCA Safe Harbor provisions.
Righthaven is often referred to as a copyright troll for its practices of suing far and wide on dubious legal theories; for example, see this Boingboing post from last December on Righthaven. Courts have steadily dismissed and dismantled the company's claims and legal strategies and the company is now in (financial) ruins. Good riddance to bad garbage.
Seriously, how fucked up is this? I think it's important to realize that "cutting off peoples' Internet access" doesn't just mean you can't download files. My kid requires the net to do his homework, which is posted by his schoolteachers on a series of blogs. My landline phone goes over my cable wire and is provided by my ISP. I doubt I'm unique in these things; Doctorow lists several other activities that modern life assumes people will have Internet for, such as banking and participating in political life. Losing Internet means losing all these and more.
I am reminded of a long-ago conversation Bruce Sterling and I had about his novel "Islands in the Net." The gist of it was the central thesis that access to the network was about to become like electricity - it's just assumed and you only tend to notice it when it's not there. I suspect that when the Cartel starts getting its way a whole lot of people are going to find this sudden absence troubling. Maybe if a lot of them are in the US Congress then we'll see some course-correction. But I tend to doubt it.
For these studies, the FMC worked in depth with five people in the industry who make their living full-time with music. Using data provided by the professionals, the FMC then graphed and wrote up explanations of how money flowed in, from where, etc. As with any case study the results aren't necessarily broadly interpretable but it's nice to have some detailed data to go with the more general surveys we usually see.
This is sort of the canonical prior art: if you can show that an invention from a patent was in fact already known publicly then the patent can't stand. You can still patent new inventions related to the idea - for example, Apple's patent on providing word-by-word suggestions for auto-completion as users type is unlikely to be invalidated simply because someone described the general form and function of a tablet computer in 1994.
Still, Fidler's writings, videos, and demonstrations were public; the fact that they weren't patented doesn't lessen their potential value as relevant prior art. There's some chance as Rosenwald describes it that a good lawyer could show how Apple people were exposed to and potentially influenced by these ideas. Apple probably would still maintain the majority of its patent position even if certain design and foundational patents were invalidated, but its position would be significantly weaker. That may be why rumors are starting to float that Apple may want to settle. A settlement would foreclose the possibility of the patent portfolio being weakened and could leave Apple in a strategically stronger position than another partial win a full-length court case.
Earlier this week, Yahoo! filed suit against Facebook alleging that it infringed on 10 different Yahoo! patents. Normal course of business, except for the timing and the companies involved. Facebook is involved in trying to go IPO, and a big-name public lawsuit could monkey-wrench the whole works. Yahoo! is floundering desperately trying to find someone to lead it and some business in which it can compete, or at least have enough going for it to be worth someone bigger buying.
The meat of the suit seems broad - Yahoo is hitting at Facebook on ad generation, customization, and aspects of social networking such as creating news feeds, messaging, and managing comments. I haven't read the patents in question, but I wanted to comment on how the suit seems to be stirring up the geek community by looking at some items that appeared in response to the suit that gave me the head-scratching WTF pause.
Uh... yeah. I don't even know where to start with that one. Even if the public somehow figured out what was happening, which I wouldn't bet on, what would they care if Big Corporation A pays Big Corporation B some money? It's not like anyone's Facebook pages are going to go away because of this. Facebook will probably pay up and may change some of their features to get around patent clauses, but honestly Facebook changes your pages so often and so arbitrarily that nobody's going to notice a few more changes.
Meanwhile, Gizmodo is screaming that "Yahoo Is Out To Burn Down The Web". Uh, guys? Facebook isn't the Web, however much Facebook would like you to believe it is. And if Yahoo's patent is valid and enforceable against Facebook then yes they may well try to enforce it against other sites. Which would be a tragedy exactly... how?
The article's author, Mat Honan is grotesquely misinformed about how patent protection works. He claims that "Facebook is built on its own unique codebase" which is probably true and completely irrelevant to whether or not they're infringing the patent. Let me 'splain... no, is too complicated, let me sum up: whether or not you wrote your own code from scratch isn't at issue here. What's at issue is what that code does. Also, Honan wails that if this is upheld then "Yahoo [would own] personalization outright." Oh, puh-leeze. Patents protect inventions; anyone who thinks Yahoo patented every single possible invention related to personalization is... wait, named Mat Honan? What does it even mean to "own" personalization? Get a grip, Mat, use your inhaler, take a Valium.
And finally we have Andy Baio writing for WIRED about how Yahoo "weaponized" "his" patents. Oh, cry me a river. First of all, his patents aren't at issue here, as he admits. (Though he's probably not responsible for the attention-grabbing headline on his column.) More to the point, Baio is whining that Yahoo actually got patents while he was there and even though he hates patents he helped them get some and now they're actually (*GASP*) using patents in an offensive way, not just in the defensive manner he thinks he was promised.
Let me find you some tissues. The very first lecture I ever attended on patenting in a corporate environment (at Texas Instruments in 1989 if anyone cares) covered the notion of "sword" and "shield" patents and how it was only a distinction of convenience. If you didn't get such information, or weren't motivated to understand what you were doing when you helped Yahoo apply for patents, my sympathy for you is precisely zero. No one is required to sue anyone in order for a patent to be valid (unlike, say, a trademark) but that option is always there.
Yes, it sure would have been nice if Yahoo could have turned its innovations into wildly financially successful products so it didn't care about who was using its patented inventions. But it didn't, and it does, and these suits are just part of the death throes of the company. Perhaps one day all that will remain of Yahoo will be a few patents that have been upheld in court and that someone will pay money to acquire. So it goes. Between then and now it'd be nice to see less hysteria and more clear-headed analysis on the topic.
The live launch includes a "90 days free" enticement, but is limited to web-enabled iOS devices only. They promise Android support "coming soon". 20 channels, 40 hours of DVR storage, and the ability to use the service on up to 5 devices.
Contrary to my initial impression the customer doesn't buy an Aereo antenna - instead they connect to the company's antennas over the Web, with no new physical devices in or on the consumer's home. In addition, you don't have to install a new app - apparently you can connect using the built-in iOS media-viewing software. After the 90-free, the service costs USD 12/month and is geographically limited to New York television marketplace. It's not clear from the press release if that means the physical limits of the city or whether it'll be available to people outside the area who can receive New York City broadcast channels (about half of New Jersey and Connecticut I believe).
If anyone tries out the service please do leave a comment with your impressions.
You may recall I blogged about Konrath's claim that he garnered $100,000 in profits from his e-books in January of this year. Obviously he's someone heavily invested in Amazon's publishing model and as we discussed, he's also someone who pays careful attention to prices and how an author can maximize income by carefully discounting and tracking the effects of deals on sales. The agency model for pricing, which is at the heart of the collusion case, is just about the opposite of that - it handcuffs retailers and gives pricing power to the agency partners - the aforementioned big publishers. You can imagine this as being the digital equivalent of a poke in the eye for guys like Konrath and Eisler, and they have some choice words in response.
In a blog entry titled "Barry, Joe, & Scott Turow" they go line-by-line through Turow's dire news and translate it into more or less plain-speaking English. For example, where Turow sees Amazon "destroy bookselling" they point out that lowering prices tends to increase sales and in general selling more books is (should be) what publishing is about. They go on at some length - you should read it for yourself. They're pretty contemptuous not just of Turow and his blog post, but of the whole big-house/big-author publishing business and its failures to anticipate, react, or adapt to the sea changes introduced by self-publishing and e-books.
But those are problems that need to be dealt with openly and head-on, not by some (potentially illegal) back-room deal. Remember that the big losers in these collusion situations are the readers who are getting swindled. And if DOJ puts a stop to that then more power to them, I say.