Via Jim Lippard (who’s a GC employee), here’s a story about Global Crossing’s criticism of the FCC’s decision to extend the 1994 Communications Assistance for Law Enforcement Act to IP-based networks:
The agency also plans to stand firm with the May 2007 deadline, he said. In fact, the days of “endless” extensions for achieving CALEA compliance are effectively over for any broadband or voice-over Internet protocol company, he said, because most deployed their equipment after October 1998, thereby exempting them from relief.
Kouroupas and Global Crossing aren’t alone in balking at the mandate. A group of organizations and companies that included Sun Microsystems, Pulver.com, the American Association of Community Colleges, the Association of American Universities and the American Library Association lodged an appeal against the rules last fall. But a divided appeals court panel upheld the FCC’s rules, dismissing the group’s argument that Congress never intended CALEA to force broadband providers–and networks at corporations and universities–to build in surveillance hubs for the police.
Continue reading →
One of the most important lessons of politics in recent years is that language matters. The words we use to describe the policies we advocate have a profound effect on how we think about them. Our choice of language has powerful effects in framing how we think about a subject. Sometimes, this effect can be benign or even beneficial. As a libertarian, I like the political implications of the terms “death tax” and “undocumented worker.” I’m not so crazy about the terms “gun control” and “war on terrorism.”
I’ve become convinced that the phrase “intellectual property” is a particularly potent bit of framing. And, in my opinion, it has become a serious obstacle to thinking clearly about the legal regimes of copyrights, patents, trademarks, and trade secrets. There are often debates, on TLF and elsewhere, that are framed in terms of whether we should be “for” or “against” intellectual property. This, it seems to me, completely obscures the real issues in the “intellectual property” debate. No one (even Levine and Boldrin) is in favor of abolishing the trademark system. Likewise, no one is in favor of extending “intellectual property” into every conceivable area of our lives (consider David Friedman’s silly proposal to give people ownership of words). Everyone believes that “intellectual property” is appropriate for some areas of the economy, and inappropriate in others.
Continue reading →
Don Marti makes a good point about the enforcibility of the GPL in the face of deals like the Microsoft/Novell pact:
The GPL is not a top-down EULA. It’s a legal “codification” of a set of cooperation and information-sharing norms, which includes an agreed mutual defense policy on patents. So whether or not the Microsoft/Novell deal is a millimeter below or a millimeter above the letter of the law isn’t that big of a deal
Siobhán O’Mahony wrote, “Informal enforcement of license terms draws upon the normative roots of the license and occurs primarily through on-line public forums. The GPL codifies a strong norm of reciprocity that has long been an important part of the programming culture…. In the eyes of both legal scholars and informants, the GPL’s strength stems not necessarily from its legality, but from the public collective opinion of community members.”
Novell is holding an IRC meeting about the deal (via LWN.net). Novell’s “inner circle”, which negotiated the separate peace, has to sell the rest of its stakeholders on discarding the cooperation norms under which they had been working in favor of a “weasel words” interpretation of the letter of a license. I don’t see how they can pull this off.
Continue reading →
Today, AEI is launching a brand new magazine titled The American. It’s a bimonthly print magazine combined with a website at American.com. The website is edited by David Robinson, who TLF readers last encountered in July, when I quoted his musings over at Ed Felten’s blog. Robinson asked me to do an article on Zune and the DMCA as one of the inaugural articles on the website:
After the release of its Zune media player last Tuesday, Microsoft faces some awkward questions about compatibility. For the last two years, Microsoft has promoted a digital music format called “Plays for Sure,” which it licenses to other companies that want to build their own player devices or music stores. But Zune uses a brand new and incompatible system. Consumers who purchased music in the “Plays for Sure” format won’t be able to play it on their Zune devices. Microsoft may get extra flack for locking its own loyal customers out of a previous version of its product, but walls between digital music platforms have a long history. “Plays for Sure” music and the new Zune format have always been incompatible with Apple’s wildly popular iPod, and with the iTunes music store.
Compatibility issues didn’t always plague the music industry.
You might think those compatibility problems would represent a market opportunity for third-party software developers. But copyright law stands in the way. The Digital Millennium Copyright Act (DMCA), enacted in 1998, prohibits “circumvention” of copy protection such as that found in Microsoft and Apple’s music formats. The copy protection gets called digital rights management (DRM). Format-conversion software is, in most circumstances, illegal unless authorized by the company that created the format. Hence, the DMCA gives software companies a legal tool to bar competitors from building products compatible with their own, promoting the balkanization of the digital media marketplace into a cacophony of mutually incompatible formats. Not only does that inconvenience consumers, it also reduces intra-platform competition and effectively locks small entrepreneurs out of the market for media hardware and software.
I think the magazine itself sounds like an exciting project. As their about page describes it, The American is “a magazine of ideas for business leaders. Modeled on Henry Luce’s original vision for Fortune Magazine, it surveys the full scope of American life through the lens of business and economics.” Check it out.
Reader X. Trapnel appears to have a newly created blog, and he has a provocative and well-argued post arguing that copyright and patent are examples of Bastiat’s broken window fallacy. I made a much more limited version of this argument back in May, where I pointed out that it was a mistake to measure the worth of peer-produced projects like Wikipedia by the revenues they generate. But X. Trapnel goes much further and argues that the entire argument for patent and copyright law are examples of the fallacy:
Just as in the Bastiat story, you have the helpful onlooker who says “But everyone must live, and what would become of innovation if every innovator could have his insight copied by the first free-rider who came along?” Just as in the Bastiat story, this is wrong. What is seen is the way in which the protected firm uses his IPR to generate monopoly profits, some of which are then plowed back into R&D, generating a pleasant stream of innovation. What is not seen is what would happen in the absence of this protection: the innovator would have to keep innovating in order to maintain his market, leveraging his expertise into further productive developments, while newcomers would be able to experiment on their own with the knowledge produced by the first. Money that once went to monopoly rents would go instead to other, more productive things–including further innovation.
The neo-Schumpeterian retort is that this is hopelessly naive: innovation requires large capital investment and the reasonable hope of monopoly rents to recoup it. But this is mere question-begging, and its plausibility lies, again, with the distinction between What Is Seen and What Is Not Seen: when we give innovators monopoly privileges of this sort, we thereby tilt the playing field dramatically towards heavily capitalized firms by jacking up the costs of the inputs (eg., prior innovations, a skilled legal team, insurance against lawsuits) to production. As a result, What Is Seen is capital-intensive innovation; What Is Not Seen is the less capital-intensive innovation that the legal regime has stamped out.
As I’ll explain below the fold, I think this argument has a certain plausibility (especially for patent law), but ultimately I don’t find it persuasive.
Continue reading →
Every week, I look at a software patent that’s been in the news. You can see previous installments in the series here. This week’s patent comes to us courtesy of Ars Technica, which reports that Comcast has successfully beaten back an attempt by Caritas Technologies to extend this patent to apply to VoIP. This is good news for the IP telephony market.
The patent covers teleconferencing in which control functions are done via the Internet, while the actual calls are placed via the traditional telephone network. I think that’s a pretty obvious idea. But instead of belaboring that point, I’d like to talk about patent scope a little bit.
Continue reading →
The New York Times has an article on the Zune that puts DRM issues front and center:
Rather than selling songs in a closed-file format like Zune or FairPlay from Apple, eMusic uses the MP3 format, which works on all devices. Though dwarfed by iTunes’ 72 percent market share, eMusic’s 10 percent share (as measured by the research firm NPD Group) beats all other stores, including Napster, Rhapsody and Wal-Mart. And eMusic might do even better if it offered songs from the four major record labels–EMI, Sony BMG, Universal and Warner–that control about 75 percent of the music market.
Aside from some small experiments, the majors do not use the MP3 format because it lacks the digital rights management, or D.R.M., technology that protects copyrighted works by preventing unlimited duplication.
It’s great that they’re putting the spotlight on the problems created by DRM, but that last sentence is highly misleading. It’s true that DRM is intended to prevent unlimited duplication, but it seems to be stretching the truth to flatly state that it succeeds in doing so. At best, I think you could say that it slightly delays unlimited duplication because it sometimes takes a few hours before someone goes to the trouble of cracking their copy and uploading it to a peer-to-peer network.
Continue reading →
Via Slashdot, here’s more evidence that open source community has reason to be concerned about the Novell/Microsoft agreement. In a question-and-answer session at a SQL Server conference, Microsoft CEO Steve Ballmer said:
Interoperability is always good for the customer, and it’s important. And we know customers want the interoperability that the hands showed between the Windows world and the Linux world.
“We’ve had an issue, a problem that we’ve had to confront, which is because of the way the GPL (General Public License) works, and because open-source Linux does not come from a company–Linux comes from the community–the fact that that product uses our patented intellectual property is a problem for our shareholders. We spend $7 billion a year on R&D, our shareholders expect us to protect or license or get economic benefit from our patented innovations. So how do we somehow get the appropriate economic return for our patented innovation, and how do we do interoperability. The truth is, because of the complex licensing around the GPL, we actually didn’t want to do one without the other.
I think this is a case where language has become a serious impediment to clear thinking about these issues. When Ballmer says that Linux “uses our patented intellectual property,” he almost certainly does not mean that Linux is in any way derived from Microsoft products, or that the people making Linux have somehow been free-riding off of Microsoft’s R & D efforts. Linux developers have repeatedly stated that Microsoft needs only to point out the infringing lines of code, and the Linux team will rip them out and replace them with code they write from scratch.
Continue reading →
Back in Part 5 of this series last April, I discussed the looming breakup of radio giant Clear Channel. And now that day is here. According to Frank Ahrens of the Washington Post, Clear Channel “has agreed to sell the company to a consortium of private-equity firms and plans to shear off more than one-third of its 1,150 radio stations, dismantling a giant that dominated the industry and became the bogyman of media consolidation for the past half-decade.” Moreover, “In a separate transaction also announced yesterday, Clear Channel said it would seek buyers for all of its television stations and 448 of its smaller radio stations,” mostly in smaller markets.
Again, don’t expect the Chicken Little media critics to acknowledge any of this. As I’ve said again and again in this ongoing series, this is an example of a well-functioning, competitive marketplace at work. Media critics think every merger or acquisition is all just part of some sort of grand conspiracy to destroy democracy or competition. But when the opposite happens and firms reorganize or downsize, the critics never say a peep.
In the end, regardless of what ownership patterns and structures look like, markets sort things out and we end up with an ever-expanding universe of media options at our disposal. In sum, despite what the Chicken Littles predict, the sky never falls. Seriously, ask yourself a simple question: Do you have more media options and outlets at your disposal today than you did 5 to 10 years ago? Read my last book if you want to see the evidence.
Tim, Steve and others go after me below in an interesting exchange on compatibility and standards. I thought I’d start a new post on this to highlight this exchange and let people really sink their fangs into me since I’m taking the provocative position (at least for this board) that everyone is blowing these compatibility and DRM issues a bit out of proportion. Specifically, in my response to Tim’s “DRM Train Wreck” post below, in which he bemoaned the lack of file compatibility in the digital music world, I argued:
“Could it not be the case that THE LACK OF compatibility between players and file formats actually encourages MORE innovation and competition in some ways? I fully know, for example, that it is impossible for me to play my Xbox games on my PlayStation console or a Nintendo console. Would we be better off if perfect compatibility existed among all the games and consoles? Would 3 major gaming platforms exist at all if we could simply play all game titles on just one of those boxes? I doubt it. I think it would be more likely that only one console would prevail and the other two would disappear. And I think that would leave us worse off as a result.
Same goes for music players, in my opinion. I fully know that I can’t play all my WMA files on an Apple Ipod. But that keeps me (and millions of others) buying non-Apple players. As a result, there’s a fairly diverse and growing market of Apple competitors. Would all those competitors be viable if we could all just play our digital music on an Ipod? Again, I wonder.”
Tim responded that he “[didn’t] understand why incompatibility would cause more competition.” And Steve, one of our most frequent and thoughtful commentators here on the TLF, responded that I am “overlooking a critical point concerning incompatibility” regarding “unintentional” vs. “intentional” variations thereof.
Continue reading →
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.