Friday, July 30, 2004

Free Speech Implications of INDUCE

John Battelle and Joi Ito comment on the potential free speech implications to be wrought by IICA.

Joi Ito: With more powerful cameras and PCs, video and Flash have become important mediums for free speech. They are increasingly being used for political action. The integration of blogs and p2p technology for sharing these videos like the BitTorrent link above from Lessig are a good example. I believe this is substantial non-infringing use.

John Battelle: In other words, the INDUCE act could kill a lot more than p2p (or the iPod or even search), it could kill free expression and political discourse. Like, for example, the use of BitTorrent to discuss with and inform the public about an important political development...

The Latest Edition to Hatch's Hit List

Ernest has added the The New York Times for their stellar reporting and ability to induce infringement with yesterday's article Now Playing, a Digital Brigadoon.

See Hatch's Hit List #16 - The New York Times

Thursday, July 29, 2004

In defense of 'Chicken Little'

Some commentators have raised accusations of 'foolish demagoguery' on the part of those who suggest the iPod is at risk due to the proposed INDUCE Act (IICA). 

The accusation is hardly an exposure of some overblown or empty argument.  That argument has always been a very solid and moving metaphor.  It is absolutely true that the iPod itself will not be threatened by IICA, but not because IICA is well written or not threatening to technological innovation.  The iPod will only be off limits to lawsuits because of what lawmakers have said on the record during the IICA hearings, where they specifically stated that the iPod was not a target.  Congress would not attempt to remove from the market a device that has been available to consumers for several years.  Orrin Hatch stated as much himself here:

For example, there is a mock complaint circulating that alleges that the Apple iPod violates S. 2560 because mp3 players would never have been commercially viable but for the preceding, massive wave of for-profit filesharing piracy that was defended by groups like the Electronic Frontier Foundation. A real court would respond to that mock complaint in two words: Complaint dismissed. The caselaw states that no one can 'induce' unlawful acts that have already occurred.

Consider this - IICA passes and several months later the iPod is released.  Do you think that Apple would not be the defendant in a lawsuit considering the current language of IICA?  It is clear that they would not only be targeted, but that their "Rip, Mix, Burn" campaign may well have been enough evidence to meet the general intent level necessary for a finding of inducement to infringe.  Hatch's position, as quoted above, does not defend a product that induces more infringement than has already occurred. 

So in one or two years when the iPod becomes available with a 200 gig harddrive, much more music than the average person owns, is that going to induce more infringement?  Maybe we'd learn the answer to that in court thanks to IICA.

No, there has been no exposure of a bunch of 'Chicken Littles' that has damaged credibility. When one must, one fights fire with fire. While IICA's authors were fully prepared to launch their campaign for support of the bill based on accusations that the P2P nets were to blame for child porn and other criminality (IICA  was originally to be called the "Inducement Devolves into Unlawful Child Exploitation Act"), the opponents of the bill had to figure out how to draw the public's (and the media's) attention to IICA's problems.

The answer for anti-IICA activists to draw attention to their comments was to use the image of Congress taking your iPod away. Was this whole campaign some big lie? No way, any product similar to the iPod that is developed after the passage of the INDUCE Act will be at risk of a suit because of the current broad language IICA.

The language of IICA is now being rewritten because of the great opposition to the bill, but that opposition didn't materialize out of thin air. It was created based on the work of activists who researched the issues and spread the truth about IICA - that it threatens to stifle technological innovation in devices capable of copying content.  That some of those activists sought to illustrate the threat to technological innovation via a metaphor people could relate to is no crime, it is in fact a testament to the resolve, creativity, and intelligence of those activists.

In fact, the only reason the 'Chicken Little' accusations can even be made is because activists worked so hard to bring IICA to everyone's attention, including those who now accuse them of overstating their case.

There is more on this issue at Ernie the Attorney and at The Importance of, here and here.  There is also more at the newly renamed Invent Blog.

The INDUCE Act is not going to threaten my iPod

Ernie The Attorney has some strong words for anyone holding up the iPod to say IICA shouldn't be passed:
"The reality is that the INDUCE Act, if it is passed, might perhaps threaten some innovation and may even lead to some stupid lawsuits. But it isn't going to threaten the iPod, and people who make that argument are engaging in foolish demagoguery. Which proves that 'foolish demagoguery' isn't the exclusive province of companies that are threatened by new technologies."

Wednesday, July 28, 2004

P2P nets compromising national security?

Now P2P is an issue of national security (C|Net) . Is this another attempt to add firepower to the arguments of the supporters of the INDUCE Act?

There is a new blog out there, "See What You Share On P2P," that posts pictures of items the author finds on P2P nets, some of which he claims are military secrets. In all fairness to the author of the site, he may be doing a service by making people aware of a situation that needs to be addressed, however, he states:

"Technology often outruns legislation. So is the case with Peer 2 Peer networks. Many people obtain P2P software so they can download music or movies. A large number of those people do not have any idea what they are sharing."

The true problem when confidential material appears on P2P nets is not a lack of legislation, it is one of computer user education and a lack of security.

Check out Chris Rush Cohen and The Importance of for the rest of the story.

My thoughts on IICA

I have a new post up on The Blawg Channel in support of the passage of an extremely narrowly tailored IICA and subject to two conditions.

Ernest Miller's response: Fair Use, Normal Use, Competive Use and the INDUCE Act (IICA).

Tuesday, July 27, 2004

Barbie on the INDUCE Act

"From My Cold, Plastic Hands, Senator Hatch"

Monday, July 26, 2004

Liable to Induce Infringement

Google adsense and MyMusicInc. (http://www.mymusicinc.com/home.htm). I clicked on one of my post pages that serve adsense ads and saw an ad for free music downloads. I typed in the url so as not to disturb my google TOS and arrived at MyMusicInc which claims that filesharing is 100% legal (http://www.mymusicinc.com/legal.htm) in Canada! and that file sharing tools (see Grokster) are legal in the U.S. What's simply amazing is that the site charges $25 to provide you with software to access p2p networks like kazaa.

Here's what Eliot Van Buskirk had to say about this site:
The fact that you paid $25 to some guy in Romania changes nothing except your bank account balance. Your potential legal risk of being sued by the RIAA for making music available for sharing is unchanged.

IICA: Bad for Artists, too

At StreamingMedia.com, Fred Wilhems argues that the Induce Act is bad for artists as well as technology companies: No Matter What You Call It, the Inducing Infringement of Copyright Act Spells Trouble
Rather than figure out how to get paid from the technology, Big Content is supporting INDUCE in order to stop the technology from coming to market. This is just stupid. INDUCE isn't going to stop hardware and software developers outside the U.S. from working on new technology and bringing it to market. It is going to stop U.S. developers from participating in this growth, just as it will stop U.S. manufacturers, distributors, and retailers from achieving any share of the profits to be made, or employing the people who perform these functions, and no one else is going to be paid, either.
(via The Importance Of...)

IICA will force P2P nets abroad, let's spare U.S. tech innovation in that process

The P2P network eDonkey is a newcomer compared to old hat Kazaa. This recent article about IICA and eDonkey explains why eDonkey may be scaring the copyright industry even more than Kazaa and the others.

EDonkey's speed shows in its technology. It downloads bits of files simultaneously, and then seamlessly puts them into one file after they reach your computer. The name eDonkey is meant to spotlight its specialty in big files. The donkey is carrying a big load for you.
This C|Net article discusses the fact that Kazaa use is slowing while use of eDonkey and BitTorrent, new rival P2P networks, is growing.

Noteworthy is the fact that eDonkey is perhaps the only P2P network incorporated in the United States (New York to be exact).

Unlike competitors, eDonkey is incorporated in New York and pays taxes here. That should account for something, Yagan [CEO] says. (Kazaa is incorporated on the small island of Vanuatu; Grokster is headquartered in Nevis, West Indies; and Earthstation 5 is run from the Jenin refugee camp in Palestine.)
Concerning the passage of the Induce Act, eDonkey's CEO says: "We'd have to figure out whether we need to close down (or) move abroad and keep doing what we're doing."

Like with spam or spyware bills, even if IICA passes, companies intent on using such a business model will find a place to do it. They will incorporate in a country that will protect them and continue to run their P2P networks.

Personally, although P2P is a great innovation I feel no sympathy for the P2P networks because they are involved in massive copyright theft and are doing nothing to stop the infringement. The point I want to make is this: let's not create an overbroad new copyright bill like IICA that will stifle innovation of mixed use technology in order to "kill off" the P2P networks because those networks will just go elsewhere anyway. Let's write a bill that very narrowly targets P2P networks to avoid 'collateral damage' in the tech sector.

The buzz at the IICA hearing was to create a bill that will get "bad actors." Let's do that, but also let's realize the probable ultimate result of IICA -- the creation of data havens and copyright infringement havens elsewhere (Russia, China, North Korea, small island states, Sealand, etc). The Induce Act should be rewritten with this is mind, otherwise, we may end up with a bill that not only stifles innovation, but does not even kill off the P2P nets. It seems that the best we can do with IICA is slow down the use of P2P, let's spare technological innovation in the United States in the process.

Please comment on what you think of the possibility for the creation of foreign 'P2P havens.'

Control by Induction?

American Library Association Washington Office, Office for Information Technology Policy intern Ross Housewright, who attended the IICA hearing last thursday "offers an entertaining and frightening personal commentary." [via LibraryLaw Blog]

Ross also offers this link to the free culture wiki on the Induce Act.

Saturday, July 24, 2004

Streamcast boss wants a seat at the table

P2P Net press release:

Senator Orrin Hatch and other interested parties should meet with members of the commercial p2p industry to discuss alternative language and solutions to the INDUCE Act, says StreamCast Networks ceo Mike Weiss, who wonders why no one from the industry was at Thursday's Senate Committee on the Judiciary hearing into it.
...
"Why is Congress turning a deaf ear towards learning the truth and hearing all sides of the story?" - Weiss asks in a statement released after the hearing...
The fact is that no one really wants to hear from the P2P networks concerning IICA. The INDUCE Act will put P2P out of business, why bother giving them a seat at the table? It would be like letting a person on death row have a say in his fate. There is nothing the P2P networks could contribute to the discussion because the only way they get what they want is if the INDUCE Act never passes. As we heard at Thursday's hearing, Sen. Hatch is adamant that something must be done about the P2P nets soon.

That's why you get no seat at the table, Mr. Weiss (but you can keep fighting from the sidelines).

Friday, July 23, 2004

Bainwol testified that he doesn't think filesharing helps sales

and that 97% of the files on p2p networks are infringing.

Seems like a short term memory for Mitch, because during the Grokster oral argument [mp3] I presume that attorneys for the industry were talking about 10% as being non-infringing because Judge John Noonan says to them:
So 10% is noninfringing? That sounds like a lot of noninfringing files to me." and "You don't solve it by calling it 'theft.' You have to show why this court should extend a statutory monopoly to cover the new thing. That's your problem. Address that if you would.
Filesharing doesn't seem to be hurting sales either. According to recent data -- I believe there were 13,000,000 more units (albums) sold in 1Q 2004 over 1Q 2003 and that file sharing networks saw somehting like a 5 million user increase over the same period.

There are studies too. Felix Oberholzer-Gee of the Harvard Business School and Koleman S. Strumpf of the University of North Carolina at Chapel Hill argue that
Even in the most pessimistic specification, five thousand downloads are needed to displace a single album sale...high selling albums actually benefit from file sharing.
and  
Our study provides the first serious evidence that file sharing cannot explain the decline in music sales in the last couple of years. In addition, in the last two quarters, music sales increased while file sharing has become even more popular.
See Oberholzer-Gee/Strumpf study [pdf]. If you're lazy or don't like pdf you can read John Schwartz or Suw Charman summaries. Also, Professor Felten, of Freedom to Tinker, offers his Grand Unified Theory of Filesharing: "Recently we've seen several studies of the impact of filesharing on CD sales. We have enough data now to draw some (very) preliminary conclusions, assuming the studies are correct. Despite the apparent contradictions between the various studies, I think there is a plausible theory that can explain them all...."

See also: Filesharing is not effecting music sales no matter how creative RIAA's accounting (Nielsen Soundscan Ratings).  Some question whther the lawsuits are even having an effect on filesharing. In fact 44% of kids don't download copyrighted music illegally. It is also not the reason that musicians don't get their checks. Musicians don't think they're helping.

Moby: "personally i just can't see any good in coming from punishing people for being music fans and making the effort to hear new music. i'm almost tempted to go onto kazaa and download some of my own music, just to see if the riaa would sue me for having mp3's of my own songs on my hard-drive." [via DigitalConsumer.org]

Fran Healy of Travis: "Kazaa and Napster and all that stuff is a brilliant way for kids to taste the album." [via TechDirt]

Peters Testimony

The Honorable Marybeth Peters (United States Register of Copyrights): "I think the Grokster/Morpheus decision is wrong as a matter of copyright law ... as a matter of policy the decision is flawed ... has left copyright owners little recourse but to sue individuals...."

  • Napster [html
  • In re Aimster [pdf] (7th Cir.)
  • Sony Betamax [html] (oral arg)
  • MGM v. Grokster (April 25, 2003) District Decision Holding That File-Sharing Companies Grokster and Streamcast Networks (Morpheus) Are Not Liable For Contributory Copyright Infringement [pdf]
  • MGM v. Grokster Oral Argument (on appeal) [mp3]



  • A History of Piracy

    While listening to Senator Leahy's testimony, I'm reminded of a recent article (Some Like It Hot) by Lawrence Lessig wherein he reminds us that every major entertainment media: film, radio and cable have their origins in piracy:
    If piracy means using the creative property of others without their permission, then the history of the content industry is a history of piracy.

    INDUCE Act :: Take Action

    I've written Hill (co-sponsor) twice and still no response. Matt Perkins sends a single email to Senator Norm Coleman and gets a response.

    As Donna reminds me, it's not too late to write your Senator so please "take a few minutes today to tell your representative why the Induce Act is the wrong way to deal with the conflict over P2P neworks. It's not too late to make a difference in this battle. Don't wait until it is."

    More than 6,000 EFF supporters have already written to their senators to stop the Induce Act from giving copyright holders this kind of veto power over new technologies. Send a letter to stop the Induce Act today.

    Update: BoinBoing reports that 30,000 letters have been sent (072604).

    IICA hearing video available

    Thomas Barger is kind enough to provide the video of Thursday's IICA hearing. You can get it in Quick Time here (right click it and save, warning: it's a pretty big file). 

    Thomas also has info on Boucher's DMCRA Hearings held on May 12, available here. Thanks Thomas!

    UPDATE: Tom Barger has posted the IICA hearing video for Windows Media Player. It is available here, just left clink, crack open a cold one, and watch. Thanks again Tom.

    IICA hearing: the next day article deluge

    There are lots of new articles concerning Thursday's IICA hearing. It appears that many in the press are convinced that IICA is a threat to technological innovation (which it is, but that message wasn't gauranteed to get out during the hearing). The coverage is altogether quite positive for those opposed to the passage of IICA.

    Washington Post: Senator Induces Support for Piracy Bill
    "The architects of file-sharing piracy make millions of dollars while attempting to avoid any personal risk of the severe and criminal penalties for copyright infringement," said Orrin Hatch (R-Utah), chairman of the Senate Judiciary Committee. "I believe we can and must find a solution in this session of Congress."
    ...
    But Kevin McGuiness, executive director of NetCoalition, a group that represents Google, Yahoo and a handful of other Internet firms, said the bill puts too much power in the hands of copyright owners. Calling the Internet a "big copying machine," McGuiness said lawyers could use the measure in a way that would "jeopardize the essential architecture of the Internet."
    InfoWorld: Tech groups fight copyright infringement bill
    "I can't find any technology company that supports this legislation as written," Shapiro testified before the Senate Judiciary Committee. "This bill is, by far, the biggest threat to personal creativity, new technology, and innovation in 20 years. I urge you to consider the harm it will engender."
    ...
    While Shapiro and other technology groups said the bill goes too far, committee chairman Orrin Hatch, a Utah Republican, challenged the groups to come up with alternative legislation to curb the unauthorized trading of copyrighted material online. The bill is not targeted at makers of legal technologies, Hatch said.
    WIRED News: Techies Blast Induce Act

    The Senate Judiciary Committee heard testimony about the Inducing Infringement of Copyrights Act -- otherwise known as the Induce Act. In its current form, the bill proposes to slap technology companies for making any device that could "induce" or encourage buyers to make illegal copies of songs, movies or computer programs. The bill, introduced by Hatch (R-Utah) and Leahy (D-Vermont), has garnered strong support from Hollywood and the music industry. But technology companies say the bill would kill innovation and potentially outlaw some of the most popular devices, including Apple's iPod.
    ...
    While all panelists expressed interest in working with the committee to halt piracy, four of the five panelists rejected the bill in its current form. The lone supporter was Mitch Bainwol, head of the Recording Industry Association of America. Observers said it was rare that on a panel of five invited witnesses, four would oppose the bill proposed by the committee chairman.
    The Inquirer: Incitement to piracy

    And the bad intellectual property laws just keep coming...
    Computer Weekly: Tech groups fight copyright infringement bill
    The legislation, which does not exempt makers of technologies with substantial legitimate uses from lawsuits, would discourage the creation of new products such as the iPod or TiVO, or home video and recording equipment, Shapiro said.
    MacWorld: Induce Act 'could kill media players'
    Kevin McGuiness, executive director and general counsel of NetCoalition said that promise was not enough. "It's a little disconcerting for those of us in the Internet community to sit idly by and watch this legislation go forward based on presumption of good intentions forever on behalf of lawyers for the entertainment community," McGuiness said.

    Thursday, July 22, 2004

    IICA hearing audio available

    If you missed the IICA hearing on Thursday (or enjoyed it so much you want to hear the rerun), you can download the audio in MP3 or OGG at bIPlog.

    After downloading the hearing you can "listen on your portable music player of choice while it's still legal." Nice potshot guys.

    Shredding IICA - CEA, IEEE-USA, NetCoalition

    Ernest Miller: Three high tech organizations came out swinging against the Inducing Infringement of Copyrights Act (IICA, née INDUCE Act) during the Senate Judiciary Committee hearing (Protecting Innovation and Art while Preventing Piracy)....

    Redrafting the INDUCE ACT (IICA)

    I think Senator Hatch and Mr. Bainwol will be happy with this modification:
    (g)(4) In this subsection, the term `whoever' means commercial file sharing networks, darknets and p2p applications, but is not meant to include email, instant messaging, search engines, web browsers, and broadband techology.
    (g)(5) The intent of this act is to codify the Betamax ruling and pre-emptively over-rule the Grokster, Morpheus decision.
    Andrew Greenberg and the IEEE offer this Proposed Substitute to S. 2560 [pdf]:

    Section 501 of title 17, United States Code, is amended by adding at the end the following:
    (g)(1) Inducement of Infringement. Whoever actively and knowingly induces infringement of a copyrighted work by another with the specific and actual intent to cause the infringing acts shall be liable as an infringer.
    (2) Contribution to an Infringement. Whoever knowingly and materially contributes to the infringement of a copyrighted work by another shall be liable as an infringer.
    (3) Vicarious Infringement. Whoever has the right and ability to supervise an activity resulting in a direct infringement and has a direct financial interest in such activity and infringement shall be liable as an infringer.
    (4) Limitations on Secondary Liability.
    (A) manufacture, distribution, marketing, operation, sale, servicing, or other use of embodiments of an otherwise lawful technology by lawful means, with or without the knowledge that an unaffiliated third party will infringe, cannot constitute inducement of infringement under Subsection g(1) in the absence of any additional active steps taken to encourage direct infringement.
    (B) manufacture, distribution, marketing, operation, sale, servicing or other use of embodiments of an otherwise lawful technology capable of a substantial noninfringing use cannot constitute contribution to an infringement under Subsection (g)(2) or vicarious infringement under Subsection (g)(3).
    (5) Damages for violations of section (g)(1) of this section shall be limited to an injunction against inducement, and actual damages for infringement of a work for which the defendant had specific and actual knowledge the work would be infringed.

    See also: Ernest Miller's Draft Substitute for the INDUCE Act (IICA) v2.0

    A Bill That Chills

    Les Vadasz (wsj $): The problem with the "Induce bill" is not its intent, but its overly broad language ... The chilling effect that a law like this would have on innovation cannot be underestimated ... If this bill is enacted, many new opportunities will migrate outside the U.S.; others will never happen. It's unconscionable that at a time when our economy needs more innovation, we'd consider enacting a law that would surely lead to less. Innovation means jobs, productivity, a betterment of our lives ... what we need are legislators who can curb their urge to legislate in areas where their actions are likely to do more harm than good.

    Backing Away from the INDUCE Act

    Ernest Miller: Two significant supporters of the bill are having second thoughts: the Business Software Alliance and Hiawatha Bray....

    IICA hearing: official testimony of witnesses available

    The official testimony of all participants in the IICA hearing (titled "Protecting Innovation and Art while Preventing Piracy") held on Thursday is up on the Senate Judiciary Committee website. It's good reading for before bed. Here are the direct links:

    THE HONORABLE ORRIN HATCH (Republican Senator from Utah)

    THE HONORABLE PATRICK LEAHY (Democrat Senator from Vermont)

    THE HONORABLE MARYBETH PETERS (United States Register of Copyrights)

    MR. GARY SHAPIRO (CEO and president of the Consumer Electronics Association)

    MR. ROBERT HOLLEYMAN (President and CEO of Business Software Association)

    MR. ANDREW GREENBERG (Vice-Chairman, Intellectual Property Committee of the IEEE)

    MR. KEVIN MCGUINESS (Executive Director and General Counsel of NetCoalition)

    MR. MITCH BAINWOL (Chairman and CEO of the Recording Industry Association of America)

    The lowdown on the IICA hearing

    The IICA hearing (officially titled "Protecting Innovation and Art while Preventing Piracy") did not turn out as badly as it could have, in fact it went very well for those opposed to the introduction of the INDUCE Act.

    Nearly every single witness at the hearing came out against IICA, with Gary Shapiro, the President and Chief Executive Officer of the Consumer Electronics Association going so far as to say that a new law is completely unnecessary (here's his press release). Most of the other witnesses stated that they thought a new and less broadly worded version of IICA should be drafted. Even the BSA, who recently put out that possibly dodgy piracy study came out to say they want IICA rewritten (here's their press release, and Robert Holleyman's testimony).

    The only witness in favor of the INDUCE Act as written was Mitch Bainwol, the Chairman and Chief Executive Officer of the Recording Industry Association of America (which was predictable). Bainwol stayed away from actually talking about the legal ramifications of IICA and instead mainly discussed how evil the P2P networks were and how file trading was hurting their industry. Shockingly, he said he would be willing to work with IICA if it were considered to be too broad.

    Also, Marybeth Peters, the head of the United States Copyright Office strongly supports IICA, but never got to comment on whether she thought a rewrite may be in order. Here is her testimony, via Copyfight.

    The conclusion of the hearing was that everyone needs to go back to the drawing board and redraft the law. Sen. Hatch is adamant that "something must be done," so it appears that there is no going back. On the other hand, it seemed that the tech industry representatives had Hatch agreeing with them that the substantial noninfringing uses Betamax doctrine should be codified, which must be scaring the crap out of the RIAA.

    It also sounded like the intent standard is a big issue and there was some conversation about using the more objective specific standard utilized by the patent law for inducement. This intent standard would make IICA much less dangerous to tech companies and innovation. In fact, if a new version of IICA codified Betamax and specifically stated that inducement in copyright would use the same specific intent standard as patent then the INDUCE Act really would not change the copyright law very much at all (a good thing).

    Finally, Sen. Hatch stated that he wanted to crank this new IICA bill out during August, so get ready for a quick and bumpy ride. It's guaranteed to shock and thrill!

    For blow-by-blow commentary on the hearing check out Ed Felton's Freedom-to-Tinker. Thanks to Ed for hosting the party.

    IICA Hearings rough notes

    Thanks to Kevin for setting this up and asking me to join.

    I listened to most of the IICA hearing webcast (with a few interruptions), and posted some rough notes.

    INDUCE Act (IICA) Hearing Play by Play

    Is happening here.

    Consumer Groups Issue Statement Against INDUCE Act (IICA)

    Ernest: In response to the Senate Judiciary Committee hearing today (Protecting Innovation and Art while Preventing Piracy) three consumer groups (Public Knowledge, Consumers Union, and Consumer Federation of America) have issued a joint statement opposing the Inducing Infringement of Copyrights Act... [pdf]

    Bogus study to be used at today's IICA hearing?

    Robert W. Holleyman II, the President and CEO of Business Software Alliance, is scheduled to speak in favor of the INDUCE Act at the IICA hearing today.

    In an odd bit of luck and good timing, the Business Software Alliance just happened to release a new piracy study recently. While these sort of studies are always self serving, this new one claims that there is $29 billion dollars of software piracy going on yearly. The fishy part is that in previous studies the same group claimed that there was $13 billion in yearly losses due to software piracy.

    [A] study released two weeks ago by the Business Software Alliance ... estimated the yearly losses from software piracy at $29 billion worldwide ...
    Opponents of the copyright bill see the trade group's study as an overt political act intended to increase support for the proposed legislation by portraying software piracy as a rapidly growing problem that is far more costly than was previously thought ...
    The trade group's previous estimate of software piracy losses was $13 billion a year ...

    The article notes that Microsoft and Hollywood studios are leading supporters of the Business Software Alliance. Larry Lessig is quoted in the article:

    "I think the senators were totally misled about what this legislation is about. This would not be a tiny, targeted change. It would be a massive change that would totally sidestep the Betamax ruling."

    Better news is that:

    More than 40 companies and organizations - ranging from Intel, Google and Verizon to the American Library Association - wrote to [Senator] Hatch on July 7, expressing concern that the bill would touch off a wave of copyright suits and would chill innovation. They requested a hearing on the bill before Congress proceeded any further.

    The full witness list for the hearing can be found here. The hearing begins in half an hour, it will be interesting to see how the piracy study is used or if it becomes an issue at all.

    Article via the International Herald Tribune (which means it is soon to be archived and thus unavailable).

    Other discussions concerning the piracy study can be found here and here.

    INDUCE Act (IICA) Senate Hearing today

    Ed Felten posts that today's hearing on the Induce Act will be webcast (link) at 2:00 PM Eastern time (for those listening live he's hosting a discussion in his comments). Ernest Miller has the witness list posted here.

    Is your computer a loaded gun?

    Siva Vaidhyanathan: At a Senate hearing on Thursday, defenders of the Induce Act -- which would ban technologies that encourage copyright infringement -- will try to explain why their bill isn't the stupidest idea they've ever come up with.

    Bainwol on Frivolous Litigation

    In Bill to Curb Online Piracy Is Challenged as Too Broad (NYT, June 24, 2004), RIAA chief exec Mitch Bainwol says that the INDUCE or IICA legislation "was meant to be narrowly tailored to address companies that build technology focused on illegal file sharing. He said he did not envision the legislation's enabling lawsuits against neutral technologies, like computer makers. 'This is not about going after the device makers,' Mr. Bainwol said, though he stopped short of guaranteeing that the recording industry would never use the measure to sue them."

    Senate INDUCEs a Threat to the Future of Information Technology

    George Pieler: Please copy and share this article, download some music files, and photocopy your favorite chapters from Bill Clinton's new book. It's fun: Just do it! Did I convince you? If so, then Senate Judiciary Committee leaders think I should be held liable for copyright infringement, and owe damages to any copyright holders affected. [pdf]

    Copyright Office Endorses INDUCE Act

    Techdirt: Marybeth Peters, Register of Copyrights for the US Copyright Office, [to testify] that the Betamax ruling goes too far and needs to be replaced ... [others testifying on behalf of INDUCE/IICA include] Robert W. Holleyman of the BSA (recently shown to have made misleading statements concerning stats about unauthorized software copying) and Mitch Bainwol of the RIAA, whose letter to the Senate about the Induce Act was easily torn to shreds by Ernest....

    Ernest: Read Marybeth Peter's 22-page statement for yourself: Statement of Marybeth Peters on S. 2560 [PDF].

    Copyright Bill to Kill Tech?

    Wired News: Mike Godwin, legal director of Public Knowledge, said Senate judiciary staff are eager to get the legislation moving because they are worried that a federal appeals court in California will uphold an April 2003 court decision that did not hold peer-to-peer companies liable for their users' copyright infringement. The so-called Grokster case was argued before the 9th U.S. Circuit Court of Appeals in February, and a decision is expected soon.

    Prelude to a Million Lawsuits

    Matt Richtel and Tom Zeller Jr. write (Bill to Curb Online Piracy Is Challenged as Too Broad, NYT, June 24, 2004) that Mitch Bainwol (RIAA chief exec) says that the INDUCE or IICA legislation "was meant to be narrowly tailored to address companies that build technology focused on illegal file sharing. He said he did not envision the legislation's enabling lawsuits against neutral technologies, like computer makers. 'This is not about going after the device makers,' Mr. Bainwol said, though he stopped short of guaranteeing that the recording industry would never use the measure to sue them."

    As I've indicated before, this legislation could easily be used to threaten sellers of legitimate technology products with infringement suits if the RIAA thinks their products help "kids" share/steal music and movies online/off. The targets of the act are clearly Grokster, Morpheus, 3-2-1 and Sony betamax (doesn't Sony sell music too?), but that doesn't mean that Apple's ipod isn't next if they don't behave exactly as the content cartel wants them to. I mean the EFF supposes that Apple could be a target because the iPod makes P2P sexy or maybe because of some past issues 1, 2. see also: importance of on EFF/Apple (esp the comments).

    As Professor Felten argues, the broad vague language leaves these companies open to attack. This in turn could cost the companies (and their insurers) millions in legal fees. Someone better say something before this thing gets passed. 

    Downhill Battle, Click the Vote, and FreeCulture.org are doing their best to stick it to INDUCE: Stop the INDUCE Act.

    INDUCE Act (IICA)

    Fred von Lohmann: "Rumor has it that Sen. Orrin Hatch (R-UT) will be introducing a bill tomorrow that would add a new Section 501(g) to the Copyright Act granting copyright owners a cause of action against those who "induce" copyright infringement...."

    Susan Crawford: "The INDUCE Act of 2004. The logic is that P2P applications inevitably lead to exploitation of children. With me so far? So the act is called the "Inducement Devolves into Unlawful Child Exploitation Act." The Act (to be proposed tomorrow by songwriter Sen. Hatch and others) amends the copyright law to say that anyone who "induces" copyright infringement is himself/itself an infringer."

    In the c-net article (Antipiracy bill targets technology) Jessica Litman, a professor at Wayne State University who specializes in copyright law, says that 'that under the Induce Act, products like ReplayTV, peer-to-peer networks and even the humble VCR could be outlawed because they can potentially be used to infringe copyrights.'

    See also Ernest's impressive Obsessively Annotated Introduction to the INDUCE Act.

    Inducing Infringement of Copyrights Act of 2004

    A BILL

    To amend chapter 5 of title 17, United States Code, relating to inducement of copyright infringement, and for other purposes.


    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

    SECTION 1. SHORT TITLE.

    This Act may be cited as the `Inducing Infringement of Copyrights Act of 2004'.

    SEC. 2. INTENTIONAL INDUCEMENT OF COPYRIGHT INFRINGEMENT.

    Section 501 of title 17, United States Code, is amended by adding at the end the following:

    `(g)(1) In this subsection, the term `intentionally induces' means intentionally aids, abets, induces, or procures, and intent may be shown by acts from which a reasonable person would find intent to induce infringement based upon all relevant information about such acts then reasonably available to the actor, including whether the activity relies on infringement for its commercial viability.

    `(2) Whoever intentionally induces any violation identified in subsection (a) shall be liable as an infringer.

    `(3) Nothing in this subsection shall enlarge or diminish the doctrines of vicarious and contributory liability for copyright infringement or require any court to unjustly withhold or impose any secondary liability for copyright infringement.'.