Monday, June 20, 2005

Is Music Sharing a Bad Thing?

I recently watched a series of panel discussions from the recent Consumer Electronics Association meetings about intellectual property

An interesting position was taken by
Gary Shapiro, the CEO of the CEA: There is really no such thing as "Intellectual Property," at least that this kind of creative material is not "property" as defined in the law of our land. He took this position, in my opinion, primarily so he could go on to say that creative material, such as music and films, cannot be "stolen" in the same way that real property can be stolen. After all, one can loan a CD to a friend, who can rip the whole contents to their disk, then return the CD to the owner. The owner of the CD gets his property back (the physical CD), after all. Taking Shapiro's position, no harm has been done.

I don't believe that Shapiro actually thinks this way, but rather that he is taking a polarizing position in the debate in an attempt to: a) support the position of his association members; b) incite a dialog.

No one questions that when an artist creates a piece of work, such as a song, he/she has the right to determine how it will be sold, to whom it will be sold, and what the price will be. When a buyer decides the price is too much for a product, the buyer does not have the option to steal the art instead. It's buy it or leave it.

Music sharing really is stealing. It is taking a piece of art from the owner, who offers it to the public for a price, and making original-quality copies available to all who choose to download it. Both the uploaders and downloaders are stealing, and most know it.

But the real issue being debated is who has liability then a theft occurs, and who has responsibility for fixing the problem.

Clearly, the person who takes possession of the property is one of the people liable. Does that mean the artist should sue all the free downloaders? Some say that this is at least misdemeanor theft, and the downloader should be arrested. After all, if you go into a Wal-Mart and shoplift the CD, it's a misdimeanor -- why should downloading carry a greater penalty? So the severity of the penalty is being debated, but reasonable folks seem to agree that it theft nonetheless.

What about the author of the software that enables the file sharing? Is Grokster or BitTorrent liable? Some would say yes, they are profiting from a criminal act. The litmus test suggested by the RIAA is that if the significant fraction of the use of the technology is to enable illegal acts, then the P2P technology creator should be liable. Others note that gunmakers are not held liable for crimes committed with their products. The P2P network guys are very careful to say they don't provide a service, only a software product.

What about the folks who make the technology that plays the stolen art? Should they have responsibility for creating protection mechanisms so only properly licensed art can be viewed/played? The CEA emphatically says no, and I tend to agree. Car manufacturers are not required to secure the trunk of a car so that personal items placed in the trunk cannot be stolen. If someone steals your golf clubs from the trunk of you Z4, you can't hold BMW liable. The car makers don't even have to put a lock on the trunk. Their prospective buyers might not choose to purchase that car because of it, but the golf club manufacturer doesn't get a vote.

And finally, what responsibility does the artist have for protecting their property? Seems to me that this is where a great deal of the burden needs to be placed. Let's say CDs had been designed to be perfectly copy protected, and that no device on the planet could ever duplicate a CD or rip songs from the CD which could be played on anything else. Would the artist put a stack of his perfectly protected CDs in the main concourse of Grand Central Station with a basket that says "$5 each" and expect more that a very small minority of people to actually pay? Of course not, the artist and the retailers are expected to take reasonable steps to prevent theft. They do so with the physical media but have been greedy and negligent in demanding the same kind of security for the digital versions of their property.

So where I've come down on this thing is that the movement from analog LPs to digital CDs, the artists and the record companies have been lazy about demanding tighter security, preferring to get to market quickly with CDs and not wanting to invest anything in tighter security, and are now suffering the consequences.

If we want to stop this problem, the artists need to withhold their material from the market until the technology guys figure out a better system of security. How many have the stamina to do this?

Of course, the outcome of such a boycott might be that other artists might figure how to make money in spite of the lack of security.

It's a little like the shoplifting problem -- retailers can stop shoplifting by locking all their merchandise behind glass doors. But they tolerate a little theft because buyers have shown that they only purchase items they can touch and feel, and it's too labor intensive for the retailer to have an employee follow every shopper around unlocking doors (which most shoppers would find too intrusive anyway). To be sure, the retailers continue to seek new ways to prevent shoplifting without harming the shopping experience for the legitimate customers. The same kind of balance will be found with digital media.

Additional thoughts: (20 Jul 05):

The Supreme Court has decided that Grokster et al could be held liable for copyright infringment if it is found that: a) their business model is predicated on enabling users to commit infringment; and, b) if the P2P network makes no effort to dissuade their users from infringing.

People who think the P2P network should be held blameless cite to the wisdom of the Betamax case, in which the Supreme Court decided that Sony was not a de facto participant in copyright infringement simply because they made a device which could be used to perform infringment. It was recognized that there was substantial non-infringing uses for the device (e.g. time-shifting), and that tipped the balance. The decision did NOT change the fact that unauthorized duplication and distribution of protected materials is illegal, only that Sony could not be held liable.

Here is the exact language from the Supreme Court decision on Grokster:
"One who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, going beyond mere distribution with knowledge of third-party action, IS LIABLE for the resulting act of infringement by third parties using the device, regardless of the device's lawful uses."

Justice Souter wrote additionally in his separate opinion: "The record is replete with evidence that from the moment Grokster and StreamCast began to distribute their free software, each one clearly voiced the objective that recipients use it to download copyrighted works, and each took active steps to encourage infringment." ... "StreamCast's executives monitored the number of songs by certain commercial artists available on their networks, and an internal communication indicates that they aimed to have a larger number of copyrighted songs available on their networks that other file-sharing networks. The point, of course, would be to attract users of a mind to infringe..." "Finally, there is no evidence that either company made an effort to filter copyrighted material from users' downloads or otherwise impede the sharing of copyrighted files."

So the Supreme Court didn't "find Grokster guilty." What it said was that the trial court applied an improper standard in this case, then clarified what the standard should be. The case was remanded to the trial court, and the decision as to whether Grokster et al are actually guilty will be decided by the trial court, using this new standard. It doesn't look good for Grokster give the evidence, but anything can happen in a jury trial (e.g. OJ Simpson and Michael Jackson).

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