Archive for the 'DRM' Category

Study Released: ICT Interoperability and eInnovation


John Palfrey and I released today in Washington D.C. a White Paper and three case studies on ICT Interoperability and eInnovation (project homepage here.) The papers are the result of a joint project between Harvard’s Berkman Center and the Research Center for Information Law at St. Gallen, sponsored by Microsoft. Our research focused on three case studies in which the issues of interoperability and innovation are uppermost: digital rights management in online and offline music distribution models; various models of digital identity systems (how computing systems identify users to provide the correct level of access and security); and web services (in which computer applications or programs connect with each other over the Internet to provide specific services to customers).

The core finding is that increased levels of ICT interoperability generally foster innovation. But interoperability also contributes to other socially desirable outcomes. In our three case studies, we have studied its positive impact on consumer choice, ease of use, access to content, and diversity, among other things.

The investigation reached other, more nuanced conclusions:

  • Interoperability does not mean the same thing in every context and as such, is not always good for everyone all the time. For example, if one wants completely secure software, then that software should probably have limited interoperability. In other words, there is no one-size-fits-all way to achieve interoperability in the ICT context.
  • Interoperability can be achieved by multiple means including the licensing of intellectual property, product design, collaboration with partners, development of standards and governmental intervention. The easiest way to make a product from one company work well with a product from another company, for instance, may be for the companies to cross license their technologies. But in a different situation, another approach (collaboration or open standards) may be more effective and efficient.
  • The best path to interoperability depends greatly upon context and which subsidiary goals matter most, such as prompting further innovation, providing consumer choice or ease of use, and the spurring of competition in the field.
  • The private sector generally should lead interoperability efforts. The public sector should stand by either to lend a supportive hand or to determine if its involvement is warranted.

In the White Paper, we propose a process constructed around a set of guidelines to help businesses and governments determine the best way to achieve interoperability in a given situation. This approach may have policy implications for governments.

  • Identify what the actual end goal or goals are. The goal is not interoperability per se, but rather something to which interoperability can lead, such as innovation or consumer choice.
  • Consider the facts of the situation. The key variables that should be considered include time, maturity of the relevant technologies and markets and user practices and norms.
  • In light of these goals and facts of the situation, consider possible options against the benchmarks proposed by the study: effectiveness, efficiency and flexibility.
  • Remain open to the possibility of one or more approaches to interoperability, which may also be combined with one another to accomplish interoperability that drives innovation.
  • In some instances, it may be possible to convene all relevant stakeholders to participate in a collaborative, open standards process. In other instances, the relevant facts may suggest that a single firm can drive innovation by offering to others the chance to collaborate through an open API, such as Facebook’s recent success in permitting third-party applications to run on its platform. But long-term sustainability may be an issue where a single firm makes an open API available according to a contract that it can change at any time.
  • In the vast majority of cases, the private sector can and does accomplish a high level of interoperability on its own. The state may help by playing a convening role, or even in mandating a standard on which there is widespread agreement within industry after a collaborative process. The state may need to play a role after the fact to ensure that market actors do not abuse their positions.

While many questions remain open and a lot of research needs to be done (including empirical studies!), we hope to have made a contribution to the ongoing interoperability debate. Huge thanks to the wonderful research teams on both sides of the Atlantic, especially Richard Staeuber, David Russcol, Daniel Haeusermann, and Sally Walkerman. Thanks also to the many advisors, contributors, and commentators on earlier drafts of our reports.

The Future of Books in the Digital Age: Conference Report


Today, I attended a small, but really interesting conference chaired by my colleagues Professor Werner Wunderlich und Prof. Beat Schmid from the Institute for Media and Communication Management, our sister institute here at the Univ. of St. Gallen. The conference was on “The Future of the Gutenberg Galaxy” and looked at trends and perspectives of the medium “book”. I’ve learned a big deal today about the current state of the book market and future scenarios from a terrific line-up of speakers. It was a particular pleasure, for instance, to meet Prof. Wulf D. von Lucus, who’s teaching at the Univ. of Hohenheim, but is also the Chairman of the Board of Carl Hanser Verlag, which will be publishing the German version of our forthcoming book Born Digital.

We covered a lot of terrain, ranging from definitional question (what is a book? Here is a legal definition under Swiss VAT law, for starters) to open access issues. The focus of the conversation, though, was on the question how digitization shapes the book market and, ultimately, whether the Internet will change the concept “book” as such. A broad consensus emerged among the participants (a) that digitization has a profound impact on the book industry, but that it’s still too early to tell what it means in detail, and (b) that the traditional book is very unlikely to be substituted by electronic formats (partly referring to the superiority-of-design-argument that Umberto Eco made some time ago).

I was the last speaker at the forum and faced the challenge to talk about the future of books from a legal perspective. Based on the insights we gained in the context of our Digital Media Project and the discussion at the forum, I came up with the following four observations and theses, respectively:

Technological innovations – digitization in tandem with network computing – have changed the information ecosystem. From what we’ve learned so far, it’s safe to say that at least some of the changes are tectonic in nature. These structural shifts in the way in which we create, disseminate, access, and (re-)use information, knowledge, and entertainment have both direct and indirect effects on the medium “book” and the corresponding subsystem.

Some examples and precursors in this context: collaborative and evolutionary production of books (see Lessig’s Code 2.0); e-Books and online book stores (see ciando or; online access to books (see, e.g., libreka, Google Book Search, digital libraries); creative re-uses such as fan fiction, podcasts, and the like (see, e.g., LibriVox, Project Gutenberg,

Law is responding to the disruptive changes in the information environment. It not only reacts to innovations related to digitization and networks, but has also the power to actively shape the outcome of these transformative processes. However, law is not the only regulatory force, and to gain a deeper understanding of the interplay among these forces is crucial when considering the future of books.

While fleshing out this second thesis, I argued that the reactions to innovations in the book sector may follow the pattern of ICT innovation described by Debora Spar in her book Ruling the Waves (Innovation – Commercialization – Creative Anarchy – Rules and Regulations). I used the ongoing digitization of books and libraries by Google Book Search as a mini-case study to illustrate the phases. With regard to the different regulatory forces, I referred to Lessig’s framework and used book-relevant examples such as DRM-protected eBooks (“code”), the use of collaborative creativity (“norms”), and book-price fixing (“markets”) to illustrate it. I also tried to emphasis that the law has the power to shape each of the forces mentioned above in one way or another (I used examples such as anti-circumvention legislation, the legal ban on book-price fixing, and mandatory copyright provisions that preempt certain contractual provisions.)

The legal “hot-spots” when it comes to the future of the book in the digital age are the questions of distribution, access, and – potentially – creative re-use. The areas of law that are particularly relevant in this context are contracts, copyright/trademark law, and competition law.

Based on the discussion at the forum, I tried to map some of the past, current, and emerging conflicts among the different stakeholders of the ecosystem “book”. In the area of contract law, I focused on the relationship between authors and increasingly powerful book publishers that are tempted to use their unequal bargaining power to impose standard contracts on authors and transfer as many rights as possible (e.g. “buy out” contracts).

With regard to copyright law, I touched upon a small, but representative selection of conflicts, e.g. the relation between right holders and increasingly active users (referring to the recent hp-lexicon print-version controversy); the tensions between right holders and (new) Internet intermediaries (e.g. liability of platforms for infringements of their users in case of early leakage of bestsellers; e.g. interpretation of copyright limitations and exemptions in case of full-text book searches without permission of right holders); the tension between publishers and libraries (e.g. positive externalities of “remote access” to digital libraries vs. lack of exemptions in national and international copyright legislation – a topic my colleague Silke Ernst is working on); and the tension between right holders and educational institutions (with reference to this report).

As far as competition law is concerned, I sketched a scenario in which Google Book Search would reach a dominant market position with strong user lock-in due to network effects and would decline to digitize and index certain books or book programs, for instance due to operational reasons. Based on this scenario, I speculated about a possible response by competition law authorities (European authorities in mind) and raised the question whether Google Book Search could be regarded, at some point, as an essential facility. (In the subsequent panel discussion, Google’s Jens Redmer and I had a friendly back-and-forth on this issue.)

Not all of the recent legal conflicts involving the medium “book” are related to the transition from an analog/offline to a digital/online environment. Law continues to address book-relevant issues that are not new, but rather variations on traditional doctrinal themes.

I used the Michael Baigent et al. v. Random House Group decision by the London’s High Court of Justice as one example (has the author of Da Vinci Code infringed copyright by “borrowing” a theme from the earlier book Holy Blood, Holy Grail?), and the recent Esra-decision by the German BVerfG as a second one (author’s freedom of expression vs. privacy right of a person in a case where it was too obvious that the figure used in a novel was a real and identifiable person and where intimate details of the real person were disclosed in the book.)

Unfortunately, we didn’t have much time to discuss several interesting other issues and topics that were brought up and related to the generation born digital and its use of books – and the consequences of kids’ changed media usage in a changed media environment, e.g. with regard to information overload and the quality of information. Topics, to be sure, that John Palfrey and I are addressing in our forthcoming book.

In sum, an intense, but very inspiring conference day.

Update: Dr. David Weinberger, among the smartest people I’ve ever met, has just released a great article on ebooks and libraries.

Second Berkman/St. Gallen Workshop on ICT Interoperability


Over the past two days, I had the pleasure to co-moderate with my colleagues and friends Prof. John Palfrey and Colin Maclay the second Berkman/St. Gallen Workshop on ICT Interoperability and eInnovation. While we received wonderful initial inputs at the first workshop in January that took place in Weissbad, Switzerland, we had this time the opportunity to present our draft case studies and preliminary findings here in Cambridge. The invited group of 20 experts from various disciplines and industries have provided detailed feedback on our drafts, covering important methodological questions as well as substantive issues in areas such as DRM interoperability, digital ID, and web service/mash ups.

Like at the January workshop, the discussion got heated while exploring the possible roles of governments regarding ICT interoperability. Government involvement may take many forms and can be roughly grouped into two categories: ex ante and ex post approaches. Ex post approaches would include, for example, interventions based on general competition law (e.g. in cases of refusal to license a core technology by a dominant market player) or an adjustment of the IP regime (e.g. broadening existing reverse-engineering provisions). Ex ante strategies also include a broad range of possible interventions, among them mandating standards (to start with the most intrusive), requiring the disclosure of interoperability information, labeling/transparency requirements, using public procurement power, but also fostering frameworks for cooperation between private actors, etc.

There was broad consensus in the room that governmental interventions, especially in form of intrusive ex ante interventions, should be a means of last resort. However, it was disputed how the relevant scenarios (market failures) might look like where governmental interventions are justified. A complicating factor in the context of the analysis is the rapidly changing technological environment that makes it hard to predict whether the market forces just need more time to address a particular interoperability problem, or whether the market failed in doing so.

In the last session of the workshop, we discussed a chart we drafted that suggests steps and issues that governments would have to take into consideration when making policy choices about ICT interoperability (according to our understanding of public policy, the government could also reach the conclusion that it doesn’t intervene and let the self-regulatory forces of the market taking care of a particular issue). While details remain to be discussed, the majority of the participants seemed to agree that the following elements should be part of the chart:

  1. precise description of perceived interoperability problem (as specific as possible);
  2. clarifying government’s responsibility regarding the perceived problem;
  3. in-depth analysis of the problem (based on empirical data where available);
  4. assessing the need for intervention vis-à-vis dynamic market forces (incl. “timing” issue);
  5. exploring the full range of approaches available as portrayed, for example, in our case studies and reports (both self-regulatory and regulation-based approaches, including discussion of drawbacks/costs);
  6. definition of the policy goal that shall be achieved (also for benchmarking purposes), e.g. increasing competition, fostering innovation, ensuring security, etc.

Discussion (and research!) to be continued over the weeks and months to come.

Ian Brown Comments On IIPA’s Copyright Recommendations


My colleague and friend Dr Ian Brown, co-leader of the EUCD best practice project (check out the wiki and the project report), has posted a great article written for the EDRI-gram on the International Intellectual Property Alliance’s (IIPA) recent recommendations to the US Trade Representative’s 2007 review of global copyright laws. Ian concludes:

It is not surprising that US companies lobby to change global laws that would increase their profits. On past performance, the US government is likely to take careful note of their recommendations. But European nations should robustly defend their right to shape copyright policy to meet the needs of their own citizens, and not just those of large copyright holders.

I hope the EUCD best practice project mentioned above and similar initiatives support European policy makers in identifying the leeway they have under the WIPO Internet Treaties and the EUCD when shaping their copyright and DRM frameworks.

ICT Interoperability and Innovation – Berkman/St.Gallen Workshop


We have teamed up with the Berkman Center on an ambitious transatlantic research project on ICT interoperability and e-innovation. Today, we have been hosting a first meeting to discuss some of our research hypotheses and initial findings. Professor John Palfrey describes the challenge as follows:

This workshop is one in a series of such small-group conversations intended both to foster discussion and to inform our own work in this area of interoperability and its relationship to innovation in the field that we study. This is among the hardest, most complex topics that I’ve ever taken up in a serious way.

As with many of the other interesting topics in our field, interop makes clear the difficulty of truly understanding what is going on without having 1) skill in a variety of disciplines, or, absent a super-person who has all these skills in one mind, an interdisciplinary group of people who can bring these skills to bear together; 2) knowledge of multiple factual settings; and 3) perspectives from different places and cultures. While we’ve committed to a transatlantic dialogue on this topic, we realize that even in so doing we are still ignoring the vast majority of the world, where people no doubt also have something to say about interop. This need for breadth and depth is at once fascinating and painful.

As expected, the diverse group of 20 experts had significant disagreement on many of the key issues, especially with regard to the role that governments may play in the ICT interoperability ecosystem, which was characterized earlier today by Dr. Mira Burri Nenova, nccr trade regulation, as a complex adaptive system. In the wrap-up session, I was testing – switching from a substantive to a procedural approach – the following tentative framework (to be refined in the weeks to come) that might be helpful to policy-makers dealing with ICT interoperability issues:

  1. In what area and context do we want to achieve interoperability? At what level and to what degree? To what purpose (policy goals such as innovation) and at what costs?
  2. What is the appropriate approach (e.g. IP licensing, technical collaboration, standards) to achieve the desired level of interoperability in the identified context? Is ex ante or ex post regulation necessary, or do we leave it to the market forces?
  3. If we decide to pursue a market-driven approach to achieve it, are there any specific areas of concerns and problems, respectively, that we – from a public policy perspective – still might want to address (e.g. disclosure rules aimed at ensuring transparency)?
  4. If we decide to pursue a market-based approach to interoperability, is there a proactive role for governments to support private sector attempts aimed at achieving interoperability (e.g. promotion of development of industry standards)?
  5. If we decide to intervene (either by constraining, leveling, or enabling legislation and/or regulation), what should be the guiding principles (e.g. technological neutrality; minimum regulatory burden; etc.)?

As always, comments are welcome. Last, but not least, thanks to Richard Staeuber and Daniel Haeusermann for their excellent preparation of this workshop.

EUCD Best Practice Guide Released


We have just released our EUCD best practice guide. The report, sponsored by the Open Society Institute (OSI), provides a set of recommendations for transposing the EU Copyright Directive (EUCD) into the national copyright frameworks of accession states and candidate countries. The guide, which could also inform future law reform in existing member states and is related to stock-taking studies such as the Gowers Report (released yesterday) and the forthcoming official review of the EU copyright framework, is based on a peer-produced compilation and comparison of existing EUCD implementations across the EU.

The best practice guide takes a closer look at four clusters of legal issues typically associated with EUCD-implementation. First, in a cross-sectional manner, it provides recommendations regarding the implementation of the EUCD’s anti-circumvention provisions (i.e., legal protection of technological protection measures). Second, it suggests a series of principles in areas of copyright law that shape the ways in which we – as peers – can produce and distribute information. The third section deals with universal access issues, including teaching and research exceptions, exceptions for libraries, archives, and the like, and copyright exceptions for disabled people. Third, the document provides recommendations with regard to selected copyright provisions that have an impact on political and cultural participation.

Here is an overview of the recommendations we’ve made:

Anti-circumvention provisions

  • In order to avoid unintended consequences in general and spillover effects of anti-circumvention legislation in particular, (a) define the subject matter and scope of TPM as narrow as possible; (b) choose a liberal approach to exceptions and limitations and make sure that beneficiaries of exceptions can enjoy them; and (c) take a minimalist approach to sanctions and remedies for the violation of anti-circumvention provisions.
  • Provide a definition of the circumstances (“minimum threshold”) under which TPM are considered to be “effective”.
  • To the extent possible, limit the scope of prohibited circumvention-relevant conduct to situations where circumventions would lead to actual infringement of copyright.
  • Immediately establish a mechanism for the enforcement of copyright exceptions vis-à-vis TPM and in the absence of voluntary measures by right-holders. Provide for an easily accessible and effective enforcement mechanism.
  • Incorporate a private copying right vis-à-vis TPM analog to traditional private copying exceptions in order to foster access to information, knowledge, and entertainment.
  • Use discretion with regard to sanctions and penalties and adhere to the principle of proportionality. Consider limitations on criminal and civil liability for non-profit organizations such as libraries, archives, etc., flexible sanctions for innocent infringers, and limitations on sanctions for legitimate purposes such as research and teaching.

Peer collaboration & distribution

  • Provide for a broad private copying exception that is applicable to both analog/offline and digital/online works.
  • Use discretion with regard to sanctions and penalties imposed on illegal file-sharing (uploading) and adhere to the principle of proportionality. Consider limitations on criminal and civil liability for small-scale infringements.
  • Provide for a private copying exception that encompasses the act of downloading copyrighted material from the Internet, including from P2P file-sharing networks, regardless of the lawfulness of the master copy or the distribution platform.

Universal Access

  • Provide a broad teaching exception that not only covers materials for face-to-face use in the classroom of educational facilities, but also the use of works at home for studying purposes. The preparation and post-processing of courses at educational institutions should be included as well.
  • Implementations should not (further) limit the scope of the teaching exception as stipulated in the EUCD. Instead, provide for open definitions of the limitations on exempted uses for teaching purposes.
  • Transpose the quotation exception by allowing quotations in multimedia works with an educational purpose or within instructions and textbooks for educational use.
  • Provide for an exception that allows publicly accessible libraries and archives as well as documentation centers to make copies of entire works for specific purposes, without respect to whether these institutions are part of an educational or scientific institution or of a museum.
  • Explicitly allow the reproduction of works on any medium in both digital and analog format.
  • Allow the sharing of out-of-print copies among beneficiaries if certain requirements are met (out-of-print clause).
  • Explicitly regulate the question of traditional as well as advanced forms of electronic document delivery by privileged institutions such as public libraries in the national copyright act.
  • Permit electronic forms of delivery (e.g. in graphic file format) of individual copies of articles in periodicals and parts of published works to patrons for private study and research for non-commercial purposes, regardless whether the relevant material is available via an on-demand service or not.
  • Provide for a broad disability exception to both the rights to reproduction and communication to the public that might mention, but is not limited to, certain types of disabilities such as visual or hearing impairment.
  • Consider an exception or limitation for people with disabilities without requiring fair compensation.

Political & Cultural Participation

  • Provide for a current-event exception and prescribe the conditions under which the freedom of expression right trumps the exlusive author’s rights. Do not restrict the scope of the exception to traditional media, such as newspapers, television or radio.
  • The quotation right should allow diverse forms of quotations. It should encompass multimedia quotes as well as texts.
  • Allow private persons to disseminate public and political speeches over the internet.
  • Explicitly allow creative forms of political and cultural crticism. Use caricature, parody or pastiche as exemplary forms, but do not restrict the exception to these forms.

Download the full report for detailed discussion, references to member state implemenations, and case law examples.

Testifying on Swiss DRM-Protection Bill


Earlier this week, I had the opportunity to provide expert testimony before the Legal Affairs Committee of the Swiss Council of States (roughly equivalent to the U.S. Senate) regarding Switzerland’s implementation of the WIPO Internet Treaties and revision of the copyright act, respectively. It doesn’t come as a surprise that the bill is hotly debated among different stakeholders, and the committee members confirmed that they have received many letters and e-mails in the run-up to the hearing.Right after a presentation by Apple’s iTMS Switzerland Managing Director, I testified about alternative business models for the distribution of digital content that don’t (primarily) rely on DRM protection. Of course, I was also talking about the Berkman Center’s Digital Media Exchange Project. After the presentations, the committee members asked a series of excellent questions about technological, economic, and legal aspects of DRM. Since the debates are traditionally confidential, I can’t go into details here. Instead, I would like to point to some of the characteristics of the bill that I find particularly commendable:

  • The bill only prohibits the circumvention of effective technological protection measures aimed at protecting copyrighted materials.
  • The bill includes a definition of the effectiveness criterion.
  • The ban cannot be enforced against individuals who circumvent TPMs in order to make use of the work in a way that is traditionally permitted by the copyright act (e.g. making a private copy).
  • In contrast to the EUCD, all the exceptions and limitations also apply to on-demand services.
  • Although the bill creates civil and criminal liability, it adheres to the principle of proportionality with regard to sanctions and penalties. In the context of criminal sanctions in the case of circumvention of TPMs, intent (“Absicht”) is required.

On the other hand, several areas of concern remain (see here and here for background information):

  • It’s unclear as to what extent the beneficiaries of a copyright exception can make use of it vis-a-vis TPM. An earlier draft created an innovative and powerful enforcement mechanism (see former draft art. 39b and art. 62, translated here), but the revised draft before the parliament now proposes the establishment of an oversight body (“Beobachtungsstelle”) that facilitates discussion between the stakeholders and might have the power, upon authorization by the Swiss Federal Council, to intervene (e.g. by way of recommendations) in the case of DRM misuse if the “public interest” would require it.
  • The encryption exception has been mentioned in materials, but not in the bill itself.
  • The ban of trafficking in circumvention devices is absolute.
  • The bill doesn’t address transparency and interoperability issues – although I agree that the copyright act is not the best place to deal with these issues.

Besides these TPM-related issues, it is noteworthy that downloading files from P2P services remains legal (private copying exception) under the current version of the bill. In this context, one might also want to mention that the bill doesn’t seem to build on the (contested) assumption that DRM and anti-circumvention laws will reduce piracy. Here as in all other areas, it will be interesting to observe – given the lobbying efforts by the copyright industry – how the draft legislation further evolves once it is debated in public by our national law-makers.

New Study on Technological Protection Measures


My draft paper on “Legal Frameworks and Technological Protection of Digital Content: Moving Forward Towards a Best Practice Model” is now online available via SSRN. The abstract reads as follows:

The increased ability to copy and distribute information, knowledge, and entertainment in the digitally networked age has provoked a series of responses. In order to gain back control, copyright holders have made use of so-called technological protection measures (TPM) – including, for instance, Digital Rights Management (DRM) schemes – that are aimed at regulating the copying, distribution, and use of and access to digital works through code (“code is law”). Activists, in turn, have immediately taken counter-measures and designed tools that enable the hacking of technological protection measures such as copy and access controls. In response, law makers at both the international and national level have enacted legal provisions aimed at banning the act of circumvention of TPM on the one hand and the production and dissemination of circumvention tools on the other hand. Prominent examples of such legislation, among others, are the WIPO Internet Treaties (WCT art. 11 and WPPT art. 18), the Digital Millennium Copyright Act (DMCA sec. 1201), the European Copyright Directive (EUCD, art. 6 and art.8), and the respective implementations of the EUCD into the laws of EU Member States.

Against this backdrop, this paper takes it as its baseline that many countries have already enacted legislation or will soon legislate on TPM in order to comply either with international obligations under WIPO, or with international free trade agreements involving a party that has powerful content industries such as the U.S. Thus, the immediate question before us is no longer whether the second and third layer of protection of digital works is appropriate or viable. Rather, at this stage, attention should be drawn to the alternative design choices that remain with countries that face the challenge of drafting or revisiting a legal regime aimed at protecting TPM. Consequently, the purpose of this paper is to identify different legislative and regulatory approaches and to discuss them in the light of previous experiences with TPM legislation in the U.S. and in Europe. Ultimately, the paper seeks to formulate basic design (or best practice) principles and to sketch the contours of a model law that aims to foster innovation in the digitally networked environment and minimize frequently observed spillover effects of TPM legislation.

Basic Design Principles for Anti-Circumvention Legislation (Draft)


Over the past few weeks I’ve been working, among other things, on a paper on third layer protection of digital content, i.e., anti-circumvention legislation in the spirit of Art. 11 WCT and Art. 18 WPPT and it’s counterparts in regional or national pieces of legislations (e.g. Art. 6/8 EUCD and Sec. 1201 DMCA.) The 50+ pages, single-spaced paper is very much research in progress. It is based on prior research and takes it as its baseline that many countries have already enacted legislation or will soon legislate on TPM in order to comply either with international obligations under WIPO, or with international free trade agreements involving a party that has powerful content industries such as the U.S. Thus, I argue that the immediate question before us is no longer whether the second and third layer of protection of digital works is appropriate or viable (personally, I’m convinced that it is not, but that’s another story. BTW, initial reactions to my draft paper by friends suggest that I should use stronger language and make a clear normative statement in this regard. I’m not sure whether a more radical approach will contribute to project’s goal, but I will re-consider it.) Rather, at this stage, attention should be drawn to the alternative design choices that remain with countries that face the challenge of drafting or revisiting a legal regime aimed at protecting TPM.

Consequently, the purpose of the working paper (drafted in the context of a consulting job for a government in the Middle East) is to identify different legislative and regulatory approaches and to discuss them in the light of previous experiences with TPM legislation in the U.S. and in Europe. Ultimately, the paper seeks to formulate basic design (or best practice) principles, and to sketch the contours of a model law that aims to foster innovation in digitally networked environment and minimize frequently observes spillover effects of TPM legislation.

The paper is divided into three parts. In the first Part, I provide a brief overview of international and national legal frameworks that protect technological measures by banning the circumvention of TPM. The second Part of the paper discusses three particularly important as well as generally contested elements of anti-circumvention legislation—i.e., subject matter and scope; exemption interface; sanctions and remedies—and analyzes in greater detail some of the differences among jurisdictions in order to identify alternative approaches or what we may call “design choices.” The third Part provides a brief summary of what commentators have identified as core areas of concern with this type of legislation. Based on the findings of Part II and the preceding section, basic design principles will be suggested. The final section paints in broad strokes a model law with discussion issues and some guiding principles that might be helpful to policy makers who face the challenge of crafting anti-circumvention legislation.

Today, I’d like to share with you some thoughts at the most abstract level of the paper. Against the backdrop of the analysis in the first two Parts of the paper, I tried to formulate five basic design principles for legislators that face the challenge to implement the WIPO Internet Treaties anti-circumvention provisions. These principles are further specified in the final part of the paper, which provides the rough outline of a model law. The relevant section reads as follows:

“Part II of the paper and the previous section has analyzed, inter alia, what approaches to TPM legislation have been taken and what consequences (intended as well as unintended) certain design choices might have. For the reasons discussed in Part II.C., it is not feasible to provide detailed substantive guidance as to how an anti-circumvention framework should look like without knowing the specifics of the legislative, judicial, cultural, economic, and political environment of the implementing country. However, it is possible, based on the analysis in this paper, to suggest three basic subject-matter design principles that should be taken into account by policy makers when drafting and enacting anti-circumvention laws:

  • Principle 1: Get the terminology right, i.e. provide precise, clear, and unambiguous definitions of key concepts and terms such as “technological (protection) measures,” “effective” TPM, “acts of circumvention;” etc. The analysis of existing anti-circumvention laws in different jurisdictions across continents suggests that legislators, by and large, have done a poor job in defining core terms of anti-circumvention. Although it is true that laws often use abstract terms that require interpretation, it is striking how many vague concepts and ambiguous terms have been identified within the context of TPM legislation. The EUCD, as it has been transposed into the laws of the EU Member States, is particularly illustrative of this point since it leaves it up to the national courts and, ultimately, to the European Court of Justice to define some of the basic terms used in the respective pieces of legislation. In particular, legislators should avoid merely “copying and pasting” provisions as set out by international treaties or other sources of norms without making deliberative choices about the concepts and terms that are used.
  • Principle 2: Recite traditional limitations and exceptions to copyright in the context of anti-circumvention provisions. The review of exception regimes under various legal frameworks as well as the overview of initial experiences with anti-circumvention legislation in the U.S. and in Europe has suggested that anti-circumvention provisions tend to change the carefully balanced allocation of rights and limitations previously embodied in the respective national copyright laws. Particularly significant shifts can be observed in areas such as research (including reverse engineering), teaching, and traditional user privileges such as fair use or the “right” to make private copies. Apparently, not all of these shifts have been intended or anticipated by policy makers. Thus, it is crucial to carefully design the exception framework applicable to TPM, provide appropriate mechanisms for the effective enforcement of exceptions, analyze the interplay of the exception regime with the other core elements of the anti-circumvention framework, and conduct an in-depth impact analysis.
  • Principle 3: Use discretion with regard to sanctions and remedies and adhere to the principle of proportionality. International legal frameworks provide some degrees of flexibility in drafting civil and criminal penalties. Implementing countries should carefully consider the available design choices under the applicable framework, thereby following the principle of proportionality. Among the usual options to be considered are limitations on criminal and civil liability for non-profit institutions such as libraries, archives, and educational institutions, flexible sanctions for innocent infringers, and limitations on sanctions for legitimate purposes such as scientific research and teaching. Again, the interplay among the liability provisions and the other elements of the framework, including scope and exceptions, must be equilibrated.

The review of various controversies—both in practice and theory—surrounding the implementation and application of anti-circumvention frameworks suggests, as noted above, that both the intended effects (e.g. on piracy) as well as the unintended consequences of third layer protection of copyright (e.g. on competition, innovation, etc.) remain uncertain and contested. In this situation of uncertainty and in light of anecdotal evidence suggesting spillover-effects, policy-makers are well-advised to complement the three principles outlined above by two more general principles.

  • Principle 4: Incorporate procedures and tools that permit the monitoring and review of the effects of the anti-circumvention provisions on core values of a given society. Given the degrees of uncertainty mentioned above, it is crucial to establish mechanisms that enable policy makers and stakeholders to systematically identify and assess the effects of TPM and corresponding legislation and, thus, to incorporate what we might call the ability to learn and improve based on “law in action.” Such processes and tools might include legislative, administrative, or academic review and might focus, among others, on the core zones of concern outlined above with special attention to the exception regime.
  • Principle 5: Set the default rule in such a way that the proponents of a more protective anti-circumvention regime bear the burden of proof. As noted, experiences with anti-circumvention legislation so far have not (or at best, only partly) been aligned with its raison d’�tre. Instead, attention has been drawn to unintended consequences. This situation requires that the proponents advocating in favor of a more protective regime (i.e., a regime that increases, along the spectrum set by international obligations, the constraints on a user’s behavior) must provide evidence why additional protections for TPM—e.g. in form of broader scope, narrower exceptions, more severe penalties, or the like—are necessary.”

Comments welcome.

French Supreme Court Uphelds Legality of DRM on DVD


The French Cour de Cassation – the highest court in the French judicial system – recently reversed a ruling by the Paris Court of Appeals in the landmark case UFC v. Films Alain Sadre et al. and remanded it, stating that the private copying “right” is not an absolute users’ right and, therefore, that the application of technological protection measures inhibiting the making of copies for private purposes is not illegal under French law.

Recall that UFC, a consumer rights association, filed a lawsuit claiming that a copy protection system on a DVD (here: DVD Mulholland Drive) is in conflict with the provisions of the French Intellectual Property Code, which limit copyright owners’ rights regarding reproductions strictly made for the copier’s private use. The District Court disagreed and confirmed that such technological protection measures comply with the EUCD and French legislation. The Paris Court of Appeals, in contrast, held – as reported here – that the DRM system in this particular case was illegeal and that the failure on the part of the producers and distributor of the DVD to inform consumers of the presence of DRM upon the DVD violated French consumer protection law.

Last year, the Versailles Appeals Court rendered a judgment upholding the legality of technological protection measures on a CD from the French singer Alain Souchon, and – only a few weeks prior to the Cour de Cassation’s judgment – the Tribunal de Grande Instance de Paris (District Court) blocked the application of anti-copying technology on Warner Music’s “Testify” CD from Phil Collins (more here). Against this backdrop, it is interesting to observe how things will develop – not only on the copyright front, but also with regard to the consumer protection argument. For a detailed discussion pre-Feb 28th, see Natali Helberger’s analyses on INDICARE (1, 2, 3, 4).

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