Conference Highlights DMCA Divisions

Update 5/1/06: Ed Felten posted a response on his blog to the claim by a DMCA proponent (below) that the ligitation he faced was a “happy ending” because he was able to present his paper.

Original Post 4/27/06: This post was supposed to cover two different stories on the Digital Millennium Copyright Act (DMCA), but it ran long so I broke it into two related posts. This post covers the DMCA conference and the next focuses on new legislation being proposed to tighten DMCA.

Policymakers and experts focused on the DMCA during a half-day conference held yesterday by the Cato Institute titled “Copyright Controversies Freedom, Property, Content Creation, and the DMCA.” (Hopefully they will put video or a podcast of the event on their site.) Finding little common ground, they battled over whether or not copyright policy generally and DMCA specifically have met the challenges of the digital age.

The conference started with a panel of two sitting Members of Congress: Congressman Lamar Alexander (R-TX), Chairman of the powerful Courts, the Internet, and Intellectual Property Subcommittee (which has jurisdiction over the DMCA); and Rep. Zoe Lofgren (D-CA), who is also on the IP subcommittee. Chairman Smith opened with a couple of interesting remarks:

“DMCA is the foundation for the nation’s digital economy.” And then a bit later, “DMCA makes capitalism work in the digital economy.”

Relative to those provocative remarks, the rest of his talk was largely as expected — that the digital content age is starting to flourish, namely iTunes, and Congress needs to make sure the law has mechanisms to go after those with the tools to strip content protections. He did express regret that the DMCA has been used inappropriately as a legal cudgel at times. This is the first time that I’ve heard a DMCA supporter even mention this. Unfortunately, his solution wasn’t to narrow DMCA to curb these suits, rather it was to champion tort reform to “get rid of frivolous law suits.” (He pointed out the House passed legislation to do so, but the Senate did not take it up).

Rep. Lofgren went in the other direction, saying Congress overreached with DMCA and the act hampered innovation. She discussed her proposal to reform DMCA, the Balance Act (H.R. 4536). She mentioned that there were very few in Congress that understood or believed in DMCA’s drawbacks. She could only name a few Republicans and Democrats that agreed with her. I’ll come back to this issue in a bit.

The next two panels, while interesting and informative, weren’t terribly productive as they focused on legal philosophies of copyright and whether we should even have copyrights. Anytime you start discuss Locke’s and economic principles of marginal cost connections to copyright, you will lose the vast majority of policymakers.

The last panel focused squarely on DMCA with technical and legal experts debating the law’s efficacy. While the debate between the panelists was good, the takeaway was how little common ground they had. Tim Lee, of the Show-Me Institute walked through his recently released paper, Circumventing Competition: The Perverse Consequences of the Digital Millennium Copyright Act, on the DMCA. It is an excellent analysis (about 20 pages but well worth the read) because it not only deals with copyright law, it focuses on the DMCA’s impact or potential impact on technology, research and more broadly competitive markets.

Solveig Singleton of The Progress & Freedom Foundation defended the DMCA arguing that technology was needed to protect digital content and needed a little legal assistance, hence the DMCA. She also clearly stated that lawsuits brought against individuals for copyright infringement weren’t a realistic way to deal with piracy and the DMCA was a far better tool. She argued that it was up to those opposed to DMCA to find a better solution. She was fairly dismissive of Mr. Lee’s arguments, particularly about some of the lawsuits that chilled innovation. She noted that the DMCA was a success because the suits against individual researchers — specifically citing the one against Ed Felten for his research on music protection — were dropped and they were able to present their papers. I won’t speak for Ed (he is a member of USACM’s Executive Committee), but I doubt he would hold himself up as a DMCA “success story.”

While Tim’s presentation was cogent, his paper was stronger. The debate throughout the day tended to focus on whether “DRM worked” or whether we even need copyrights. These arguments, while important, aren’t terribly persuasive to policy makers.

Congress is worried about the real problem of piracy of copyrighted works and wants solutions. I relate this back to Rep. Lofgren’s comments that there are few champions of DMCA reform in Congress. One can certainly take the cynical tack that the media companies have a more effective “lobby.” While I won’t dispute their power, part of the issue is proving one of two things to lawmakers: 1) there is a viable alternative, or 2) the costs the DMCA extracts from innovators and researchers and its anti-competitive impact on the marketplace are too high a price to pay. The cost aspect was a key part of Tim’s paper and one that disappointingly wasn’t highlighted during the conference. Given the polarization between the parties and the state of technology, the perfect DRM technology and legal system may not be possible. That leaves us with trying to change the DMCA, likely incrementally, which will only occur if Congress understands the high tradeoffs.

These arguments become particularly important when new legislation is proposed, like the draft floated by Chairman Smith, to make the DMCA more stringent. We need to make Congress understand that rather than serve as the foundation of the digital economy, the DMCA deters innovation and markets.

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