Articles by Ryan Radia

Ryan is associate director of technology studies at the Competitive Enterprise Institute, where his work focuses on adapting law and policy to the unique challenges of the information age. His research areas include privacy, IP telecommunications, competition policy, and media regulation.


A Free Market Defense of Retransmission Consent

by on April 11, 2012 · 2 comments

Unshackling a market from obsolete, protectionist regulations can be a very challenging undertaking, especially when the lifeblood of a regulated industry is at stake. The latest push for regulatory reform to encounter the murky waters of modernization is the “Next Generation Television Marketplace Act.” The ambitious and comprehensive bill, introduced by Rep. Steve Scalise and Sen. Jim DeMint in their respective chambers of Congress, aims to free up the broadcast television market. The federal government’s hands have been all over this market since its inception, overseen primarily by the FCC, pursuant to the Communications Act.

The Next Generation Television Marketplace Act (“DeMint/Scalise”) is a bold and laudable bill that would, on the whole, substantially free up America’s television marketplace. But one aspect of the bill—its abolition of the retransmission consent regime—has sparked a vigorous debate among free marketers. This essay will explain what this debate is all about and why policymakers should think twice before getting rid of retransmission consent.

Toward a Free Market in Television

The DeMint/Scalise bill takes an axe to many of the myriad rules that stand in the way of a free market in television programming. As Co-Liberator Adam Thierer recently explained on these pages, the bill’s many provisions would among other things get rid of the compulsory licensing provisions in the Copyright Act that empower government to set the rates cable and satellite (“pay-TV”) providers must pay to retransmit distant broadcast signals. It would eliminate the “network non-duplication” rule, which generally bars pay-TV providers from carrying out-of-market signals that offer the same programs as local broadcasters. The bill would also end the “must-carry” rule that forces pay-TV providers to retransmit certain local broadcast signals without receiving any compensation.

These are just a few of the many provisions of the DeMint/Scalise bill that would substantially reform the Communications and Copyright Acts to foster a free video marketplace and bring television regulation into the 21st century. (For a more in-depth assessment of the positive aspects of the DeMint/Scalise proposal, see Adam’s informative Forbes.com essay, Toward a True Free Market in Television Programming; Randy May’s superb Free State Foundation Perspectives essay, Broadcast Retransmission Negotiations and Free Markets;” and Bruce Owen’s FSF essay, The FCC and the Unfree Market for TV Program Rights.)

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Are Rogue Websites Really So Bad After All?

by on January 23, 2012 · 6 comments

In the ongoing debate over SOPA, PIPA, and rogue websites legislation, most commentators have focused on what Congress should and shouldn’t do to combat these sites. Less attention, however, has been paid to the underlying assumption that these rogue websites represent a public policy problem. While no one has defended websites that defraud consumers by deceptively selling them fake pharmaceuticals and other counterfeit goods, many consumers who frequent “rogue websites” do so for the express purpose of downloading copyright infringing content.

As Julian Sanchez explains over on Cato-at-Liberty, how the latter category of rogue websites (including The Pirate Bay and, until last week, MegaUpload) affects the U.S. economy and social welfare is hotly contested in the economic literature:

[I]t’s become an indisputable premise in Washington that there’s an enormous piracy problem, that it’s having a devastating impact on U.S. content industries, and that some kind of aggressive new legislation is needed tout suite to stanch the bleeding. Despite the fact that the [GAO] recently concluded that it is “difficult, if not impossible, to quantify the net effect of counterfeiting and piracy on the economy as a whole,” our legislative class has somehow determined that . . . this is an urgent priority. Obviously, there’s quite a lot of copyrighted material circulating on the Internet without authorization, and other things equal, one would like to see less of it. But does the best available evidence show that this is inflicting such catastrophic economic harm—that it is depressing so much output, and destroying so many jobs—that Congress has no option but to Do Something immediately? Bearing the GAO’s warning in mind, the data we do have doesn’t remotely seem to justify the DEFCON One rhetoric that now appears to be obligatory on the Hill. The International Intellectual Property Alliance . . . actually paints a picture of industries that, far from being “killed” by piracy, are already weathering a harsh economic climate better than most, and have far outperformed the overall U.S. economy through the current recession.

Julian makes several great points, and his essay is well worth reading in its entirety.

Nevertheless, in my view, rogue websites dedicated to the infringement of U.S. copyrights pose a public policy problem that merits not only serious congressional attention, but also prompt (albeit prudent) legislative action. While I’m relieved that the flawed SOPA and PIPA bills seem unlikely to pass in their current forms, I also think it would be unwise for Congress to dither on rogue sites legislation for years in search of “credible data” about how such sites impact our economy.

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Why SOPA Threatens the DMCA Safe Harbor

by on November 18, 2011 · 25 comments

The Stop Online Piracy Act (SOPA), a controversial bill before the House of Representatives aimed at combating “rogue websites,” isn’t just about criminal, foreign-based sites that break U.S. intellectual property laws with impunity. Few dispute that these criminal websites that profit from large-scale counterfeiting and copyright infringement are a public policy problem. SOPA’s provisions, however, extend beyond these criminal sites, and would potentially subject otherwise law-abiding Internet intermediaries to serious legal risks.

Before moving forward with rogue websites legislation, it’s crucial that lawmakers take a deep breath and appreciate the challenges at stake in legislating online intermediary liability, lest we endanger the Nozickian “utopia of utopias” that is today’s Internet. The unintended consequences of overbroad, carelessly drafted legislation in this space could be severe, particularly given the Internet’s incredible importance to the global economy, as my colleagues have explained on these pages (1, 2, 3, 4, 5, 6)

To understand why SOPA could be a game-changer for online service providers, it’s important to understand the simmering disagreement surrounding the Digital Millennium Copyright Act (DMCA) of 1998, which grants certain online service providers a safe harbor from liability for their users’ copyright infringing actions. In exchange for these protections, service providers must comply with the DMCA’s notice-and-takedown system, adopt a policy to terminate users who repeatedly infringe, and meet several other conditions. Service providers are only eligible for this safe harbor if they act to expeditiously remove infringing materials upon learning of them. Also ineligible for the safe harbor are online service providers who turn a blind eye to “red flags” of obvious infringement.

The DMCA does not, however, require providers to monitor their platforms for infringing content or design their services to facilitate monitoring. Courts have held that a DMCA-compliant service provider does not lose its safe harbor protection if it fails to act upon generalized knowledge that its service is used for many infringing activities, in addition to lawful ones, so long as the service provider does not induce or encourage users’ infringing activities.

Defenders of the DMCA safe harbor argue that it’s helped enable America’s Internet-based economy to flourish, allowing an array of web businesses built around lawful user-generated content — including YouTube, Facebook, and Twitter — to thrive without fear of copyright liability or burdensome monitoring mandates.

Conversely, some commentators, including UCLA’s Doug Lichtman, argue that the DMCA inefficiently tips the scales in favor of service providers, to the detriment of content creators — and, ultimately, consumer welfare. Pointing to a series of court rulings interpreting the safe harbor’s provisions, critics argue that the DMCA gives online intermediaries little incentive to do anything beyond the bare minimum to stop copyright infringement. Critics further allege that the safe harbor has been construed so broadly that it shields service providers that are deliberately indifferent to their users’ infringing activities, however rampant they may be.

What does SOPA have to do with all of this? Buried in the bill’s 78 pages are several provisions that run a very real risk of effectively sidestepping many of the protections conferred on online service providers by the DMCA safe harbor.

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Preliminary Thoughts on Stop Online Piracy Act (SOPA)

by on October 26, 2011 · 18 comments

This afternoon the Stop Online Piracy Act (H.R. 3261) was introduced by Rep. Lamar Smith of the House Judiciary Committee. This bill is a companion to the PROTECT IP Act and S.978, both of which were reported by the Senate Judiciary Committee in May.

There’s a lot some to like about the bill, but I’m uneasy about some quite a few of its provisions. While I’ll have plenty to say about this bill in the future, for now, here are a few preliminary thoughts:

  • The bill’s definition of “foreign infringing sites” at p. 10 borrows heavily from 18 U.S.C. § 2323, covering any site that commits or facilitates the commission of criminal copyright infringement and would be subject to civil forfeiture if it were U.S.-based. Unfortunately, the outer bounds of 18 U.S.C. § 2323 are quite unclear. The statute, which was enacted only a few years ago, encompasses “any property used, or intended to be used, in any manner or part to commit or facilitate” criminal copyright infringement. While I’m all for shutting down websites operated by criminal enterprises, not all websites used to facilitate crimes are guilty of wrongdoing. Imagine a user commits criminal copyright infringement using a foreign video sharing site similar to YouTube, but the site is unaware of the infringement. Since the site is “facilitating” criminal copyright infringement, albeit unknowingly, is it subject to the Stop Online Piracy Act?
  • Section 103 of the bill, which creates a DMCA-like notification/counter-notification regime, appears to lack any provision encouraging ad networks and payment processors to restore service to a site allegedly “dedicated to theft of U.S. property” upon receipt of a valid counter-notification and when no civil action has been brought. The DMCA contains a safe harbor protecting service providers who take reasonable steps to take down content from liability, but the safe harbor only applies if service providers promptly restore allegedly infringing content upon receipt of a counter notification and when the rights holder does not initiate a civil action. Why doesn’t H.R. 3261 include a similar provision?
  • The bill’s private right of action closely resembles that found in the PROTECT IP Act. Affording rights holders a legal avenue to take action against rogue websites makes sense, but I’m uneasy about creating a private right of action that allows courts to issue such broad preliminary injunctions against allegedly infringing sites. I’m also concerned about the lack of a “loser pays” provision.
  • Section 104 of the bill, which provides immunity for entities that take voluntary actions against infringing sites, now excludes from its safe harbor actions that are not “consistent with the entity’s terms of service or other contractual rights.” This is a welcome change and alleviates concerns I expressed about the PROTECT IP Act essentially rendering certain private contracts unenforceable.
  • Section 201 of the bill makes certain public performances via electronic means a felony. The section contains a rule of construction at p. 60 that clarifies that intentional copying is not “willful” if it’s based on a good faith belief with a reasonable basis in law that the copying is lawful. Could this provision cause courts to revisit the willfulness standard discussed in United States v. Moran, in which a federal court found that a defendant charged with criminal copyright infringement was not guilty because he (incorrectly) thought his conduct was permitted by the Copyright act?

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Cops Abuse Cyberstalking Law, Target Anonymous Speech

by on August 26, 2011 · 7 comments

Hot-tempered police offers, pushover judges, and vague laws make for a dangerous combination. In July, a controversy erupted in Renton, Washington (a Seattle suburb) when the town’s police department launched a legal assault on an anonymous YouTube user for merely uploading a few sarcastic videos poking fun at the department’s scandals.

In an op-ed in The Seattle Times, Nicole Ciandella and I explain what happened in Renton and discuss the saga’s implications for constitutional rights in the digital age:

According to Washington state law, a person is guilty of criminal “cyberstalking” if he makes an electronic communication using lewd or indecent language with the intent to embarrass another person. In other words, a Washingtonian who creates a raunchy email message, blog post or Web video to embarrass a foe isn’t just playing dirty; he’s technically breaking the law. One YouTube user recently learned this lesson the hard way.

Last month, the scandal-ridden Renton Police Department launched a criminal cyberstalking investigation against a YouTube user known only as “MrFuddlesticks.” The user had uploaded a series of lewd, animated videos poking fun at recent allegations of wrongdoing by Renton police officers. In one video, a character talks about his civilian superior’s lack of law-enforcement experience; in another, characters discuss the impropriety of a police officer who slept with a murder suspect.

Even though none of MrFuddlesticks’ videos mention the city of Renton or any police officers by name, Renton police managed to convince a county judge to issue a warrant to compel Google, YouTube’s parent company, to disclose identifying information about MrFuddlesticks’ accounts, including credit-card details and even contents of Gmail messages.

You can read the rest of the essay here. (For more on the controversy, see Jacob Sullum at Reason’s Hit & Run; also see Mike Masnick at Techdirt. For an exploration of the case’s constitutional implications, see Eugene Volokh at The Volokh Conspiracy.)

Here on the TLF, we’ve repeatedly cautioned lawmakers about the dangers of criminalizing cyberstalking  (1, 2, 3, 4). Back in 2006, CNET’s Declan McCullagh explained why all Internet users should be worried about vague, overbroad cyberstalking laws. As the troubling actions of Renton’s finest illustrate, the potential for such laws to be abused is very real. Let’s hope lawmakers in Washington and in the numerous other states with cyberstalking laws on the books take a hard look at their laws.

 

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Reform Sarbox To Galvanize High-Tech IPOs

by on May 24, 2011 · 5 comments

Last week’s blockbuster LinkedIn IPO valued the company at nearly $9 billion, surprising many investors, especially given the company’s initial valuation of about $4 billion. While some analysts have pointed to LinkedIn’s valuation as evidence that we may be headed into another tech bubble (a la 2000), it’s important to remember that major tech IPOs remain far less frequent in comparison to their heyday in the dot com boom. While there are many good reasons behind the recent reduction in IPO frequency, ill-conceived public policies have distorted the decision-making process of thriving startups.

In an op-ed in tomorrow’s Investor’s Business Daily, Jacque Otto and I elaborate on this argument:

Silicon Valley is teeming with budding startups whose user bases and valuations are skyrocketing. As these companies seek breathing room to grow, they will face a tough decision: stay private, seek out a buyer or go public.

Making this complex choice all the more challenging is government uncertainty. Filing for an initial public offering is harder than ever due to the onerous regulations and burdensome laws Washington has handed down over the past decade. Microsoft’s $8.5 billion purchase of Skype surprised analysts, many of whom had predicted Skype would seek an IPO or a deal with Facebook or Google.

Meanwhile, Facebook has kept quiet in face of speculation over whether it might file for an IPO. So far, the social networking giant has focused on raising capital privately. Given the risks of going public in this environment, Facebook’s decision is understandable.

While some tech firms — including LinkedIn, Kayak and Demand Media — have gone public or filed for IPOs in the past year, many others — including Hulu, Zynga, and Twitter — are reportedly leaning against going public this year. Some of these may be acquired, as happened with AdMob, a mobile advertising startup rumored to be pondering an IPO until Google bought it for $750 million in 2009.

Why do tech companies appear more reluctant to go public today than they were during the tech sector’s heyday of the early 2000s?

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Privacy Solutions: How to Block Facebook’s “Like” Button And Other Social Widgets

by on May 20, 2011 · 21 comments

Social widgets, such as the now-ubiquitous Facebook “Like” button and Twitter “Tweet” button, offer users a convenient way to share online content with their friends and followers. These widgets have recently come under scrutiny for their privacy implications. Yesterday, The Wall Street Journal reported that Facebook, Twitter, and Google are informed each time a user visits a webpage that contains one of the respective company’s widgets:

Internet users tap Facebook Inc.’s “Like” and Twitter Inc.’s “Tweet” buttons to share content with friends. But these tools also let their makers collect data about the websites people are visiting. These so-called social widgets, which appear atop stories on news sites or alongside products on retail sites, notify Facebook and Twitter that a person visited those sites even when users don’t click on the buttons, according to a study done for The Wall Street Journal.

It wasn’t exactly a secret that social widgets “phone home.” However, the Journal’s story shed new light on how the firms that offer social widgets handle the data they glean regarding user browsing habits. Facebook and Google reportedly store this data for a limited period of time — two weeks and 90 days, respectively — and, importantly, the data isn’t recorded in a way that can be tied back to a user (unless, of course, the user affirmatively decides to “like” a webpage). Twitter reportedly records browsing data as well, but deletes it “quickly.”

Assuming the companies effectively anonymize the data they glean from their social widgets, privacy-conscious users have little reason to worry. I’m not aware of any evidence that social widget data has been misused or breached. However, as Pete Warden reminded us in an informative O’Reilly Radar essay posted earlier this week, anonymizing data is harder than it sounds, and supposedly “anonymous” data sets have been successfully de-anonymized on several occasions. (For more on the de-anonymization of data sets, see Arvind Narayanan and Vitaly Shmatikov’s 2008 research paper on the topic).

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Congress takes another stab at combating Rogue Websites with the PROTECT IP Act

by on May 12, 2011 · 23 comments

Last November, I penned an essay on these pages about the COICA legislation that had recently been approved unanimously by the U.S. Senate Judiciary Committee. While I praised Congress’s efforts to tackle the problem of “rogue websites” — sites dedicated to trafficking in counterfeit goods and/or distributing copyright infringing content — I warned that the bill lacked crucial safeguards to protect free speech and due process, as several dozen law professors had also cautioned. Thus, I suggested several changes to the legislation that would have limited its scope to truly bad actors while reducing the probability of burdening protected expression through “false positives.” Thanks in part to the efforts of Sen. Ron Wyden (D-Ore.), COICA never made it a floor vote last session.

Today, three U.S. Senators introduced a similar bill, entitled the PROTECT IP Act (bill text), which, like COICA, establishes new mechanisms for combating Internet sites that are “dedicated to infringing activities.” I’m glad to see that lawmakers adopted several of my suggestions, making the PROTECT IP Act a major improvement over its predecessor. While the new bill still contains some potentially serious problems, on net, it represents a more balanced approach to fighting online copyright and trademark infringement while recognizing fundamental civil liberties.

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Event Video: What Should Lawmakers Do About Rogue Websites?

by on May 10, 2011 · 7 comments

POLITICO reports that a bill aimed at combating so-called “rogue websites” will soon be introduced in the U.S. Senate by Sen. Patrick Leahy. The legislation, entitled the PROTECT IP Act, will substantially resemble COICA (PDF), a bill that was reported unanimously out of the Senate Judiciary Committee late last year but did not reach a floor vote. As more details about the new bill emerge, we’ll likely have much more to say about it here on TLF.

I discussed my concerns about and suggested changes to the COICA legislation here last November; the PROTECT IP Act reportedly contains several new provisions aimed at mitigating concerns about the statute’s breadth and procedural protections. However, as Mike Masnick points out on Techdirt, the new bill — unlike COICA — contains a private right of action, although that right may not permit rights holders to disable infringing domain names. Also unlike COICA, the PROTECT IP Act would apparently require search engines to cease linking to domain names that a court has deemed to be “dedicated to infringing activities.”

For a more in-depth look at this contentious and complex issue, check out the panel discussion that the Competitive Enterprise Institute and TechFreedom hosted last month. Our April 7 event explored the need for, and concerns about, legislative proposals to combat websites that facilitate and engage in unlawful counterfeiting and copyright infringement. The event was moderated by Juliana Gruenwald of National Journal. The panelists included me, Danny McPherson of VeriSign, Tom Sydnor of the Association for Competitive Technology, Dan Castro of the Information Technology & Innovation Foundation, David Sohn of the Center for Democracy & Technology, and Larry Downes of TechFreedom.

CEI-TechFreedom Event: What Should Lawmakers Do About Rogue Websites? from CEI Video on Vimeo.

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Mad About Bogus Takedowns? Blame Congress, Not Online Intermediaries

by on April 29, 2011 · 2 comments

User-driven websites — also known as online intermediaries — frequently come under fire for disabling user content due to bogus or illegitimate takedown notices. Facebook is at the center of the latest controversy involving a bogus takedown notice. On Thursday morning, the social networking site disabled Ars Technica’s page after receiving a DMCA takedown notice alleging the page contained copyright infringing material. While details about the claim remain unclear, given that Facebook restored Ars’s page yesterday evening, it’s a safe bet that the takedown notice was without merit.

Understandably, Ars Technica wasn’t exactly pleased that its Facebook page — one of its top sources of incoming traffic — was shut down for seemingly no good reason. Ars was particularly disappointed by how Facebook handled the situation. In an article posted yesterday (and updated throughout the day), Ars co-founder Ken Fisher and senior editor Jacqui Cheng chronicled their struggle in getting Facebook to simply discuss the situation with them and allow Ars to respond to the takedown notice.

Facebook took hours to respond to Ars’s initial inquiry, and didn’t provide a copy of takedown notice until the following day. Several other major tech websites, including ReadWriteWeb and TheNextWeb, also covered the issue, noting that Ars Technica is the latest in a series of websites to have suffered from their Facebook page being wrongly disabled. In a follow-up article posted today, Ars elaborated on what happened and offered some tips to Facebook on how it could have better handled the situation.

It’s totally fair to criticize how Facebook deals with content takedown requests. Ars is right that the company could certainly do a much better job of handling the process, and Facebook will hopefully re-evaluate its procedures in light of this widely publicized snafu. In calling out Facebook’s flawed approach to dealing with takedown requests, however, Ars Technica doesn’t do justice to the larger, more fundamental problem of bogus takedown notices.

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