New Digital Copyright Challenges Decided in the Courts - Consumers Lose One, Win Another

I believe U.S. Copyright laws provide far more legal rights to copyright owners than the copyright laws in most other developed countries actually do.  Until very recently, that mainly benefited well-established media giants (music record labels, for example, or book publishers), rather than the individuals who created the content in the first place.  However, as I reported (see the post at http://goo.gl/fu4fc) at the beginning of 2013, thanks to legislation that was passed in the mid-1970s, content creators such as authors and songwriters can now reclaim the rights to the content they actually created.  They can now legally reclaim the rights to their published works from the companies who claimed ownership of the copyrights, enabling them to license the use of that content however THEY, rather than the record label or publisher, sees fit.  This opens the possibility that we may see music from countless other content creators in things like films and TV shows.  Book content, especially from older books, are more likely to be cited in the public domain.  In effect, it opens the possibilities that didn't exist when the anointed gatekeepers of that content called the shots exclusively for themselves, which I think is a good thing.

I also commented on how archived audio recordings of music risked being lost permanently because of the United States' convoluted laws which are supposed to protect copyright ownership, but I likened it to trying to do a title search on a home but without the public records being accessible in a local, state or Federal ownership registry, making it almost impossible to identify the true owners in many cases (see my post on that http://goo.gl/3pggn).  Thanks to a recent Government initiative, that content will not necessarily be lost, and they've even encouraged some big content owners such as Sony Music to participate, which is terrific.

Much of the reason for the messy U.S. copyright situation is because of the powerful lobbying influence that giant U.S. media and publishing companies had in legislating and getting many of the things that content owners in say, Sweden are not entitled to.  This has created a situation where the profits are much, much bigger in the U.S. than they are elsewhere.  Because there are so many restrictions on content in the U.S., it has also created an environment where compliance, often without malicious intent, is difficult for consumers of that content, and legal challenges are widespread and frequent.  This is apparently what happens when a fox guards the henhouse.

However, Public Radio International ("PRI") has a fascinating story about two very recent U.S. federal court cases which were forced to apply 1976 law to modern digital innovations. PRI reports that With respect to two new digital services, the judges took two different paths, ruling one was compliant with federal copyright law, while another was not.  Much of these decisions were based on past legal precedent, the basis upon which much of U.S. law is based.

I would recommend having a listen to that story because they cover it very well, giving good insight into what these decisions actually mean and their implications for the future.  Incidentally, my astute readers might notice that the opening track in that broadcast was the 1971 song "I've Seen All Good People" by the British band Yes.

The story is available for listening at http://www.wnyc.org/story/279519-want-to-sell-your-mp3s-tell-it-to-the-judge:



PRI summed up the outcome of these two trials as follows:
TV viewers 1, iTunes users 0.

Reselling Music Bought on iTunes Violates Copyright Law Even if You Delete It

In effect, the courts ruled that users were not able to sell music downloaded from iTunes involving a court case related to ReDigi, which is a platform that let you resell digital songs you bought from iTunes (or from Amazon, Google Play or any other digital music seller) or but when you decided you don't want that music on your computer any more - a bit like like taking your old CDs to the secondhand store.  The company describes itself as follows:

"ReDigi is a free cloud service that allows you to sell your legally purchased digital music.  An online marketplace where you can buy pre-owned digital music for as low as $0.49.  Keep your music collection fresh and light by storing your unused music in your cloud and streaming it to any device.  Discover a new way to enjoy your digital music today."

Record companies argued that because the technology requires that a copy be made, ReDigi's service infringes on their copyrights. U.S. District Court Judge Richard Sullivan agreed.  To some extent, I'm starting to think my large (but not massive) CD collection might be more valuable today than it was when I bought it the first time around since owning those discs enables me to get the MP3's on iTunes very easily (free), but I actually own the discs and don't have to worry about yet-to-be-decided licensing with the content owners.  It's mine, and I can resell it on sites like SecondSpin.com anytime I like.  In fact, I've continued to buy CDs (often used) rather than buy the songs from iTunes (usually because its a lot cheaper to buy music that way).

Barry Diller Is Right (So Far), Aereo TV Is Legal

The other case, involving TV content involves a new digital streaming service called Aereo (a startup which is backed by media mogul Barry Diller), which captures broadcast TV signals and then routes them over the Internet to users who pay a fee. Network broadcasters took Aereo to court, but in Judges Christopher Droney and John Gleeson from the U.S. Second Circuit Court of Appeals refused to issue an injunction against Aereo.

Big broadcasters including Newscorp's Fox unit, Disney's ABC business, Viacom's CBS broadcasting unit, and Comcast's NBC/Universal unit and various others had sued, saying Aereo copied and retransmitted their programs as they are first aired without permission.  But the case relied heavily upon earlier legal precedents.

Specifically, the appeals court relied (in part) on an earlier court case in which judges found that Cablevision System's digital video recorder did not violate copyright law by copying and storing programs for each customer's use.  The majority said that a ruling against Aereo would conflict with its earlier decision in the Cablevision case.

Broadcasters said in court documents that allowing Aereo to proceed without paying for licenses threatens the ability of broadcasters to produce marquee sports or awards show events (that's a bullshit argument, quite frankly), including the Academy Awards and the Grammys. They also say cable and satellite operators may decide to adopt Aereo's technology or cause revenues from those paying licensing fees to decline because the content is devalued (probably true, but the question is whether copyright infringement has taken place?).  They also claim Aereo's success will hurt their ability to license content on an on-demand basis over the Internet, although they aren't exactly rushing to do themselves because of the big fees they get from packaged deals with cable companies.  Note that I blogged about a lawsuit cable giant Cablevision (which was noted above) is now suing Viacom over bundled pricing, catch that post by visiting http://goo.gl/C5qqE.  The outcome for that case hasn't happened yet, but many are watching to see what happens.

I should note that the ruling came on the Aereo case in a preliminary stage of the case in federal court.  More evidence must still be presented to a lower court judge before she issues a final decision.  Other legal challenges have been filed elsewhere against a budding industry that stands to challenge the dominance of cable or satellite companies that offer their licensed programming to consumers, which are often very costly although much of it can still be attained over the airwaves for free.

I haven't studied the legal precedents which were cited in these cases, but the issues raised in both cases are very interesting.  The story notes that Congress really needs to update the copyright laws which they haven't done in more than 35 years.  The copyright laws now governing digital content was developed in an era before digital ownership and delivery was even imagined (the Copyright Act was passed into law in 1976).

"The Copyright Act needs to take account of where we are now and not in 1976," Adam Liptak, who covers law and the Supreme Court for the New York Times, said to PRI.  He doubts that will come to pass. "The correct answer is that it should be Congress, and the likely real-world answer is it'll be the courts" that continue ruling on digital rights.

PRI added: "The fact that these cases are decided based on a law that predates the digital era by decades makes a lot of work for lawyers and judges.  It's [now] up to Congress do the real heavy lifting of changing the laws for the digital era."

The Art of Digitizing Pop Culture Content

The migration of a number of key elements in popular culture, notably music, and more recently newspaper and print media, as well as film and TV content, has occurred as the benefits of digitizing content are realized. Initially, based on the Napster debacle back in the 1990s, the entertainment industry was somewhat reluctant to move in this direction based on how that impacted the music industry's business model. But from the shooting process of a movie or TV show, to cinema projectors, the future seems to be in digital.

And beyond the risk of widespread content theft (hence the Napster reference), there are actually a number genuine benefits that the entertainment industry can realize from digitizing its content.

For example, digital content can be stored in brand-new condition forever (it doesn't deteriorate), and what's more, it can be delivered most anywhere (and there's an opportunity for content producers to charge for that!), which also happens to be where consumers want this stuff! With digital content, there is no need to worry about old celluloid film reels deteriorating in a warehouse someplace, and in the case of TV and movies, the resolution and colors on a digital version will remain in perfect, like-new condition regardless of the content's age. It also opens old content to new audiences who might never before have encountered it, in effect, stretching the income stream for old content over decades or longer.

Of course, over the years, Hollywood (by that, I mean the entertainment industry, which may or may not be based in Los Angeles) has produced tons (indeed, it may weigh tons in analog formats!) of content since the advent of "talkies" (meaning moving pictures with accompanying soundtracks). Given this huge vault of content, entertainment companies like Sony's Columbia Pictures (among others), Time Warner's Warner Brothers, Viacom/CBS Paramount Studios, Newscorp's Twentieth Century Fox studios, NBC Universal Pictures MGM/UA, Disney and others have been working to migrate their massive libraries of entertainment content to digital formats. The process of migration has been done with different speeds.

For example, music was the first to go digital with the advent of the compact disc back in the 1980s, which made converting music to MP3's and a host of other digital formats incredibly easy. Outside of music, a lot of movies and television content was already converted to digital format to create DVDs. This means that if it's already on DVD, the content has been digitized — someplace.

Not too long ago, I wrote about a specific television show, notably "Alice" which ran on CBS TV from 1976 to 1985 (catch my post HERE) whose first season was recently digitized for the first time ever. I noted in that post that Warner Brothers has a unique capability, specifically something called manufacturing-on-demand for DVDs. This means that digitized content can be transferred to a host of mediums, whether on a physical discs as DVDs, but may also easily be uploaded to a server someplace (if the producer doesn't already have it on a server already!) to be streamed to a PC, mobile device or tablet, or converted to another medium. This was one of the shows that had not been digitized, but Warner Brothers has a large library, and that digitized content exists on a website called "Warner Archive", which has many movies from Warner Brothers, as well as other studios including Sony and MGM. Television content also exists. Warner's Manufacturing-on-Demand also produces DVD on demand for Amazon.com.

What about all the non-digitized content?

Well, they're working on it, but in some cases, it's not merely a simple transfer. In many cases, the studios struggle to keep the content true to the original producer's intent, which can be challenging. What's more, much of the content was created prior to high-definition video, so there is what can be called a "translation" process involved. That's where the term "Digitally Remastered" comes from. It means they have painstakingly reviewed the content, in most cases, literally frame-by-frame. The good news is that once the content has been digitized, the process is not nearly as painstaking to convert from one digital format to another. DVD. Streaming. Whatever. If the content has been digitized, all of that is possible, and quite possibly, in formats we have not yet imagined.

Recently, NPR took a visit to Warner Brothers' vaults to look at the process involved in digitizing archived movies and television content. But it's not always a matter of merely scanning the content; in some cases, the conversion to digital changes the resolution. But for a company like Warner Brothers, there is a desire to re-sell this archived content, so the financial incentive exists. That's why the Warner Archive and DVD manufacturing-on-demand is so important, because it enables them to sell the content in a widely-used format without having to mass produce it.

Ned Price oversees the digital archives at Warner Brothers. He says "You're creating a hybrid. You want to represent what the film's intent was, and what the look was, and what the feeling was of the film, but you want to take advantage of the fact that you can see a lot more." Hence, there is an art to it. Some film directors take issue with digitizing their content because they aren't convinced the studios will hold true to their "artistic visions" for their movies or TV programming.

But others say that movies and televison content can't really be considered works of art the way a Rembrandt painting might be. Richard Donner, the director of Superman — the 1978 version with Christopher Reeve, says "It's not exactly like repainting a Rembrandt. It's not like a singular painting hanging in a museum. A lot of people would like to think that, and I have a lot of arguments with some of my fellow directors about it, but my feeling is we've turned it over to the public — hopefully they will handle it with respect."

Have a listen to this fascinating NPR clip below, or by visiting http://n.pr/O5RrtK: