Law and Information

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 Amazon.com); 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, www.harrypotterfanfiction.com).

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.

I’m delighted to announce that our Research Center for Information Law at the University of St. Gallen – usually focusing more on basic research rather than implementing project work – has just launched an online data privacy case law collection (in German and French) that features the entire collection of cases decided by the Swiss Commission for Data Privacy and Freedom of Information from 1993 – 2006. The Commission has now been integrated into the “Tribunal administrativ federal“, the branch of the Supreme Court that deals with administrative law issues. Free online access to the collection is particularly exciting since only part of the Commission’s decisions has been published so far. Thanks are due to the Swiss Federal Chancellery and the St. Gallen University’s Research Council for financial support. And, of course, special thanks to Silke Ernst, LL.M., for excellent project management.

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.

A team of experts is currently working on a resource site and best practice report on the implementation of the EU Copyright Directive (EUCD). A draft version of the best practice guide will be presented and discussed at the Wizards of OS conference in Berlin (with wonderful speakers, BTW, including Hal Varian, Claudio Prado, Larry Lessig and Yochai Benkler) and further explored at the WOS4 EUCD workshop on September 17th. A final report – based on the Berlin feedback – will be released in November.The guide is based on a peer-produced collection of particularly good (or bad!) examples of EUCD implementations in various
EU member states (and beyond). It takes a closer look at four important 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.
Together with the St. Gallen team, Ian Brown, Volker Grassmuck, and other colleagues, I have started working on the best practice guide, taking a first cut at TPM on the one hand and teaching exceptions on the other. Much more needs to be done, though, so please contact Ian Brown (I.Brown [at] cs.ucl.ac.uk) or me (ugasser [at] cyber.law.harvard.edu) if you would like to contribute to the country reports and/or the best practice guide.

As part of the Digital Media Project, Berkman Faculty Director Terry Fisher and Berkman Fellow Bill McGeveran just released a terrific study entitled “The Digital Learning Challenge: Obstacles to Educational Uses of Copyrighted Material in the Digital Age”, exploring whether innovative educational uses of digital technology – ranging from DVDs in the classroom to online resources such as Wikipedia – are hampered by copyright restrictions. Here’s the abstract:

This foundational white paper reports on a year-long study by the Berkman Center for Internet and Society, funded by a grant from the Andrew W. Mellon Foundation, examining the relationship between copyright law and education. In particular, we wanted to explore whether innovative educational uses of digital technology were hampered by the restrictions of copyright. We found that provisions of copyright law concerning the educational use of copyrighted material, as well as the business and institutional structures shaped by that law, are among the most important obstacles to realizing the potential of digital technology in education.

The paper builds on four detailed case studies of initiatives that have encountered such obstacles. Each of these initiatives is moving forward, but only by fighting against a copyright-related system that instead should be helping educators accomplish their goals. The four case studies are:

• A plan to use social networking software to help new social studies teachers interact and share classroom resources, which confronts copyright problems when teachers incorporate third-party content into their materials;
• The need of film studies professors to bypass encryption on DVDs – likely in violation of federal law – in order to show selected film clips to their students;
• An effort to make a digital database of hard-to-find but important American music available on college campuses, which encountered massive obstacles in the rights clearance process;
• The shortcomings of special statutory provisions intended to benefit public broadcasters, but limited to over-the-air broadcast so that they have become nearly irrelevant as the need to distribute content on multiple digital platforms increases.

Drawing on these case studies, other research, and comments made by a cross-section of scholars, lawyers, librarians, and educators who participated in two day-long workshops organized as part of the project, the following emerged as the most significant copyright-related obstacles to educational uses of content:

• Unclear or inadequate copyright law relating to crucial provisions such as fair use and educational use;
• Extensive adoption of “digital rights management” technology to lock up content;
• Practical difficulties obtaining rights to use content when licenses are necessary;
• Undue caution by gatekeepers such as publishers or educational administrators.

While the primary task of the foundational white paper was to identify these obstacles, the paper concludes with some discussion of paths toward reform that might improve the situation. It suggests that certain types of legal reform, technological improvements in the rights clearance process, educator agreement on best practices, and increased use of open access distribution would help overcome the obstacles we identified.

My colleagues Silke Ernst und Daniel Haeusermann contributed a comparative legal analysis to the latest Berkman report.

The Yale Journal of Law and Technology just published my article on search engine regulation. Here’s the extended abstract:

The use of search engines has become almost as important as e-mail as a primary online activity. Arguably, search engines are among the most important gatekeepers in today’s digitally networked environment. Thus, it does not come as a surprise that the evolution of search technology and the diffusion of search engines have been accompanied by a series of conflicts among stakeholders such as search operators, content creators, consumers/users, activists, and governments. This paper outlines the history of the technological evolution of search engines and explores the responses of the U.S. legal system to the search engine phenomenon in terms of both litigation and legislative action. The analysis reveals an emerging “law of search engines.” As the various conflicts over online search intensify, heterogeneous policy debates have arisen concerning what forms this emerging law should ultimately take. This paper offers a typology of the respective policy debates, sets out a number of challenges facing policy-makers in formulating search engine regulation, and concludes by offering a series of normative principles which should guide policy-makers in this endeavor.

As always, comments are welcome.

In the same volume, see also Eric Goldman‘s Search Engine Bias and the Demise of Search Engine Utopianism.

Our colleagues and friends from the Information Society Project at Yale Law School have organized a landmark conference on Access to Knowledge, taking place this weekend at Yale Law School, that brings together leading thinkers and activists on A2K policy from North and South and is aimed at generating concrete research agendas and policy solutions for the next decade. The impressive program with close to 20 plenary sessions and workshops, respectively, is available here. Also check the resources page and the conference wiki (with session notes.)

Here are some of Friday’s and yesterday’s conference highlights in newsflash-format:

• Jack Blakin’s framework outlining core themes of the A2K discourse. The three main elements of a theory of A2K: (1) A2K is a demand of justice; (2) A2K is an issue of economic development as well as an issue of individual participation and human liberty; (3) A2K is about IP, but it is also about far more than that. Balkin’s speech is posted here.

• Joel Mokyr’s lecture on three core questions of A2K: (a) Access to what kind of knowledge (propositional vs. prescriptive)? (b) Access by how many users? Direct or indirect access? (question of access intermediaries and the control of their quality) (c) Access at what costs? (Does a piece of knowledge that I need exist? If yes, where; who has it? How to get it? Verification of its trustworthiness.)

• Yochai Benkler’s fast-paced presentation on the idea of A2K as a response to 4 long-term trends (decolonization->increased integration; rapid industrialization->information knowledge economy; mass media monopolies->networked society; communism and other –isms->human dignity), the reasons why we should care about it (justice and freedom), the sources of the A2K movement as a response to the 4-long term trends (incl. access to medicine, internet freedo movement, information commons, FOSS, human genome project, spectrum commons, open access publications, digital libraries, … ), and the current moment of opportunity in areas such as regulation of information production and telecommunication policy.

• Eric von Hippel’s discussion of norm-based IP systems and a recent study on cultural norms shared among Michelin-starred French chefs that regulate – as a substitute to copyright law – how they protect ownership of their recipes.

• Keith Maskus’ lecture on the interplay between trade liberalization and increased IP protection of technologies and an overview of econometric studies regarding key IPR claims in this zone (transparent and enforceable IP regimes do seem to encourage increase in IT investments and associated export growth, both at the aggregate and micro-level; however, claim is conditioned, i.e., holds in middle-income countries, but no evidence for low income developing countries).

• Eli Noam’s talk on the evolution of firms from the pre-industrial age to today’s digitally networked environment, in which organizations are increasingly defined by information. More on the MacLuhanization of the firm here.

• Suzanne Scotchmer’s presentation on the design of incentive systems to manage possible conflicts among incentive goals such as the promotion of R&D, the promotion of its use, and trade policy goals. Scotchmer’s lecture was based on her book Innovation and Incentives.

• Michael Geist’s overview of the current controversies surrounding the idea of a two-tiered Internet – hot topics, among others,: VoiP, content control, traffic shaping, public vs. private internet, and website premium – and his discussion of the core policy questions (is legal protection from Internet tiering required? Is tiering needed for network building and management? Is it a North-South issue?)

• Susan Crawford’s discussion of the different perspectives of the Bellheads versus the Netheads and the clash of these world views in the Net neutrality debate. Susan’s key arguments are further discussed in this paper.

• Pam Samuelson’s lecture on the history of the WIPO Internet Treaties, the battles surrounding the DMCA and the EUCD, the fight against database protection in the U.S., and the lesson we can learn form these earlier tussles with regard to the A2K movement (first of all, don’t be polemic –engage in thorough research.) [Update: excellent notes of Pam’s lecture taken by Susan Crawford.]

• Jamie Love’s action points for the A2K movement, including the following (see here): (1) Stop, resist or modify the setting of bad norms; (2) change, regulate, and resist bad business practices; (3) create new modes of production (commercial and non-commercial) of knowledge goods; (4) create global frameworks and norms that promote A2K.

• Natali Helberger’s discussion of the proposed French provision on interoperability (Art. 7 of the IP Act) as an expression of cultural policy and national interests.

Professor Terry Fisher has the difficult job, as the Day 1 Rapporteur, to present in 10 minutes the OECD conference conclusions. Here are the main points he made a few minutes ago:

A. Points of agreement (or at least substantial consensus)

(a) Descriptive level:
o We’re entering a participatory culture, active users, explosion of blogs; differences in web usage.

(b) Predictive level:
o Consensus that we’ll see a variety of applications that will florish; the shift to biz models that incl internet distribution will have long tail effects, increase diversity

(c) Level of aspiration:
o We should aim for a harmonized, global Internet – single, harmonized global approach (vs. competing legal/regulatory frameworks)
o Governments should stay out, but broad consensus of 6 areas where governmental intervention is desirable: (1) Stimulating broadband; (2) fostering universal access (bridging dig.div.); (3) educating consumers; (4) engage in consumer protection against fraud, spam; (5) fostering competition; (6) promoting IP to achieve an optimal balance
o We should attempt to achieve “biz model neutrality” (TF’s personal comment: appealing idea, but infeasible, there’s no way to achieve it.)

B. Points of disagreement

(a) Descriptive level
o Whether IP currently does strike optimal balance (yes, middle ground, no – spectrum of positions)

(b) Predictive level
o Which biz strategy will prevail: pay-per-view; subscription; free-advertisement based model?

(c) Level of aspiration:
o Network neutrality: required or not as a matter of policy
o TPM: Majority: yes, smaller group: no; intermediate group: only under certain conditions.
o Should governments be in the biz of interoperability?
o Using government power to move towards open doc format?
o Government intervention to achieve an Internet that is open vs. variations of a walled-gardened net?

Last week, the European Commission unveiled its strategy to make Europe’s written and audiovisual heritage available on the Internet. From the press release:

Check out the program of the 5th Frankfurt Scientific Symposium, asking: “Is there any progress in alternative publishing? Problems of scholarly information economy.” The event takes place in Frankfurt on October 22 and 23, 2005. Impressive line-up of speakers. (Thanks to Sacha for the pointer.)