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P2P: US Supreme Court, Distributed Networking & 'Unlicenced' Expression?

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  • Terry L Parker
    At a time when US Scty of State Rice says things like protesting is a privilege ....... Anybody with a computer and internet connection may potentially rival
    Message 1 of 1 , Apr 1, 2005
      At a time when US Scty of State Rice says things like 'protesting is a privilege'.......

      Anybody with a computer and internet connection may potentially rival govt licensed broadcasting by using tech innovations like those employed for 'file swapping' now. 'Distributed Networking' aka 'Peer to Peer' (P2P) negates the current 'bandwidth barrier' that holds back 'amateur' (unlicensed by govt) streaming web casting.

      -Terry Liberty Parker

      Declan McCullagh wrote:
      Date: Fri, 01 Apr 2005 00:44:34 -0500
      From: Declan McCullagh To: politech@...
      Subject: [Politech] Travis Kalanick on Grokster court case marking "end of
      an era" [ip]

      -------- Original Message --------
      Subject: My Financial Times Op/Ed---Supreme Court & P2P
      Date: Thu, 31 Mar 2005 10:12:59 -0800
      From: Travis Kalanick


      Financial Times
      Comment: MGM v Grokster
      By Travis Kalanick
      Published: March 29 2005 21:58 | Last updated: March 29 2005 21:58

      Today is an historic day for the media and entertainment industry. Today,
      the Supreme Court of the United States will hear the biggest media
      distribution case, MGM vs. Grokster, since the Sony Betamax (VCR) case of
      1984. The fight is over what liability technology companies incur for the
      infringing behavior (a.k.a. piracy) by the users of their technology.

      The backdrop is an age-old battle. Media Industry vs. new media
      distribution technology. Copyright vs. Innovation. The recurring battle
      that has continued to be fought, over the phonograph, the photocopier, the
      tape deck, the VCR, and now P2P technology is a century old and is part of a
      bigger struggle to harmonize the goals of content ownership with those of
      technology innovation. Each time around, the battle cries get louder and
      the struggle seems to reach an ever greater fever pitch. But the outcome of
      the battle is as predictable as the battle itself. Each new innovation that
      is feared and fought is ultimately embraced and serves as a harbinger of
      prosperous new businesses and profits for the media industry. Each time,
      the foundation of innovation has continued to be held as the bedrock of our
      economy and likewise our culture.

      This recurring battle has a recurring theme.

      The entertainment industry sees the onset of a new technology, in this case
      file-swapping P2P technology, as a mortal threat to their industry. Today,
      there are billions of music and video files traded every month that are
      distributed without any license, without any payment to the owners of the
      content. For the media companies, this is the moral equivalent of a mob
      that barges into Blockbuster Video or a Virgin Records and ransacks the
      store taking all of the merchandise without even noticing the cash registers
      (or the cashiers) on their way out. Their claim is as follows: technology
      companies that build massive infringement tools should be held responsible
      for the infringement that their technology ���induces���. With penalties of
      10���s of thousands of dollars per infringement, even the largest technology
      company must think twice or face risk of bankruptcy if they deploy an
      infringement-���inducing��� product.

      The technology industry and specifically the P2P technology companies see
      things quite differently. Their main defense is a famous Supreme Court
      ruling usually referred to as Sony. Essentially, it was a very similar
      battle as the one we see today, only it was 20 years ago, and it was over
      VCR technology. A famous quote from Jack Valenti, the head of the Motion
      Picture Association in 1982 congressional hearings was ���the VCR is to the
      American film producer and the American public as the Boston strangler is to
      the woman home alone.��� It was the Motion Picture industry���s primary goal to
      keep Sony from distributing the VCR because of the rampant piracy and
      illicit recording of movies broadcast over the airwaves. At the time there
      were very few non-infringing uses of the VCR (no video rental stores, no
      DVDs), and the studios claimed that a vast majority of its usage was for
      infringement. The Supreme Court in a 5-4 decision ruled that the VCR was a
      legal device because it was ���capable of substantial non-infringing uses.���
      Today the movie industry makes twice as much revenue in home sales and
      rentals of its movies than it makes in box office. Grokster and their kin
      are quick to point out that the movie industry wouldn���t exist if the studios
      had gotten their way 20 years ago, and we are simply repeating history in
      this current court battle over P2P technology.

      The technology industry generally wants the status quo. The Sony ruling
      should stay intact, such that if their products are capable of substantial,
      non-infringing use then the ���Betamax shield��� that has driven the balance for
      innovation for the last 20 years should continue to act as the guiding
      light. They may be open to some strict language about the intent of the
      commercial entity building the potentially infringing product, ala Napster,
      Grokster, etc. but it must be strict enough that the mainstays of the
      industry are clearly not on the list of targets.

      Where does this leave us? Shockingly enough, the Supreme Court ruling we
      are all focused on will have very little if any positive effect for the
      technologists or the copyright holders. It is instructive to look at the
      potential scenarios and outcomes.

      The technology industry has a lot to lose if the ruling goes strongly
      against them. There are some concessions to be had but where do you draw
      the line? The technology industry cannot let its innovation be at the whim
      of a few copyright enforcement cops paid by the media industry. Certainly
      they wouldn���t want to incur trillions of dollars in damages for creating the
      next innovation that drives media profits for decades to come. Today,
      Apple���s IPod has sold over 10 million units, more than $2 billion in
      revenue. A majority of the tracks played on the IPod are likely infringing
      files (acquired without license or payment). Is the IPod an ���inducing���
      technology? Microsoft���s Windows operating system has allowed peer-to-peer
      connections for well over a decade. Are they next on the list? A user can
      easily encode their music into MP3���s and then send an email to all of their
      friends with an attachment that includes all of their favorite music. Is
      your favorite email application or service safe from the entertainment
      industry? Should every technology start-up hire attorneys before they even
      begin to write code?

      For the technology industry, the best that they can hope for is the status
      quo, a strong opinion in favor of the Sony ruling. The more likely outcome,
      and candidly what most technology executives expect, is some degradation of
      their degrees of freedom to innovate. Too negative a ruling and they will
      find themselves having to reassess the risks involved with building
      potentially infringing technologies. It could be many years before the
      ground rules are clear, and there might also be a substantial export abroad
      of innovation businesses and the associated knowledge resources.

      If the Media conglomerates come home with a resounding victory, Hollywood
      will have a collective but very temporary sigh of relief. Piracy will not
      ebb but will continue to thrive through more distributed, more anonymous,
      less commercial P2P. Active development for years amongst a loosely coupled
      open-source development community distributed around the globe is succeeding
      in getting the nirvana of unencumbered, high-performance p2p file-sharing to
      the masses. There are no companies, there is no entity to sue or shut down,
      and jurisdiction simply doesn���t exist to go after individual developers
      living in countries with more ���copyright-loose��� legal structures than the
      United States.

      In the Internet era, the fight against inducing technologies is futile. The
      organic nature of networked technology and the speed at which innovation
      diffuses force the court room battles into obsolescence. Regardless of
      whether the media industry wins or loses, they are left in the same place,
      rampant piracy continuing to thrive. Fighting piracy will require serious
      efforts against actual infringers instead of technologies.

      It���s not all doom and gloom. When the studios regrouped following their
      loss in Sony, they turned their prodigious creative talent toward building
      business models around the VCR technology, and they found an entirely new
      billion dollar distribution window waiting for them, twice as big as all box
      office receipts combined. While strongly embracing non-infringing business
      models of VCR technology, entertainment companies fought the actual
      individuals stealing movies instead of innovators and piracy eventually
      faded to the background.

      An equally lucrative opportunity exists with non-infringing business models
      built on P2P.Over the coming decade, a vast majority of our content will be
      distributed via the Internet. The 10���s of millions of files transferred
      daily through file-sharing will be a rounding error and pale in comparison
      to 100���s of millions of households receiving several hours of television,
      video and audio content every day. Without P2P, the Internet will simply
      break under the load, too slow to watch, too expensive to deliver. With P2P,
      billions of dollars in network upgrades can be spared with higher quality
      services from on-demand education in the home to ubiquitous mobile
      information and entertainment. Distribution of on-demand content to the
      masses will be absolute, and the low-cost democratization of media to the
      industrialized world will be complete.

      The hundreds of millions of P2P users around the world are a testament to
      this. They are captive consumers that will be convinced to participate in
      the marketplace. A cohesive anti-piracy strategy that focuses on new
      businesses, evangelizes non-infringing uses of P2P, in addition to legal
      efforts against direct infringers is a winning strategy towards that

      To their credit, in the 4 years since the Grokster suit was originally
      filed, the rights holders have come a long way. They are beginning to
      embrace the positive uses of P2P technology, and have seriously begun
      licensing content for online services. Perhaps this court case will mark
      an end of an era. Many years from now, we will all reminisce about those
      wild times with those high-pitched battles and big, bold headlines. Perhaps
      it is also the beginning of a new era. Let us all hope that we find
      copyright and innovation still in harmony.
      * Travis Kalanick is the founder and chief executive officer of RedSwoosh, a
      software company that specialises in digital media networks, and a World
      Economic Forum Technology Pioneer. travis@....


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