Start here

Net Neutrality – “You Shall Not Pass!”

By: Luis A. Velez, The IP Trend™ Blog

Achieving net neutrality could provide the Internet business environment with a just balance. Creators, investors and consumers could rely more on a public policy system that impartially regulates the Internet. It will promote free competition subject to equal resources.

The Federal Communications Commission (FCC) could regulate the price transparency and the Internet Service Providers’ (ISPs) performance. It could also regulate the ISPs limitations on network access and prevent its discriminatory charges to certain services.[1]

According to Lawrence Lessig, in his conference “Neutral Networks Work”, the Government’s authority to regulate has limited jurisdiction.[2] The scope of the FCC’s authority could extend to contractual relations.[3] Regulating contractual relations could also have a negative impact on principles such as the “freedom of contract” between private parties. However, having an impartial entity (i.e. quasi-judicial entity) that prevents unconscionable Internet contractual relations could help establish a regulatory system model in benefit of ISPs and users.[4]

Lessig suggested some interesting approaches, like the zero discriminatory surcharge (ZDS).[5] It follows that the incentive resulting from using ISPs should not be used to inflate prices.[6] The discriminatory behavior presented by some ISPs leads to scarcity of options and inflated charges to companies consuming greater amounts of bandwidth.[7] Companies should not be thwarted from entering the Internet market. The intention behind the ZDS is to prevent the extra charge on companies that use more bandwidth but offer the same services as those that are not been extra charged. If there is an extra charge for bandwidth consumption, it will create a barrier for those companies (specifically Start-ups) with limited capital. It will also prevent those companies from competing with big companies that can afford greater bandwidth capacity.

Kenneth Laudon and Jane Laudon provided an interesting insight on how the Internet could also be compared to other utility services.[8] Major cities have adopted congestion charges on utilities.[9] For example, in some cities vehicles have to pay a toll to gain entrance to the center of the city.[10] Others have used a congestion charge to regulate the higher demand on the use of electricity.[11] Recently, the President of the United States suggested classifying broadband as utility under Title II, hoping to stop ISPs, advertisers, and big corporations from entering monetary deals leading to potential unfair advantage.[12] His statement established some basic principles: ISPs should not block anyone from accessing legal content, ISPs should not frustrate Internet speed (i.e. slow access because they do not pay extra charges to ISPs) affecting some companies while offering “fast lanes” to others, and ISPs should be impartial in their treatment to intermediary service providers.[13] “There are no gatekeepers deciding which sites you get to access, there are no toll roads on the information super-highway.”[14]

The Internet promotes competition and provides an array of services. Having gatekeepers or tolls as a hurdle to access the Internet and requiring payment for its congestion or traffic could create unreasonable price fixing affecting the basic principles mentioned above. I understand that Internet services depend highly on the user demand, but demand should not be manipulated by ISPs. The nature of the Internet relies on the flow of information, its access and the users who access the information. If we continue to permit the unreasonable manipulation of prices as a requirement for users to access the Internet, then the Internet principles and the users’ freedom to decide would be compromised.

“Innovation should be measured by the ability to create, not by the ability to pay.” © -Luis Antonio Velez-


[1] See Lawrence Lessig, Neutral Networks Work, YouTube (April 17, 2008) http://www.youtube.com/watch?v=_mYbYG-nXVA

[2] See id.

[3] See id.

[4] See id.

[5] See id.

[6] See id.

[7] Bandwith refers to “the volume of information per unit of time that a transmission medium (i.e. Internet connection) can handle.” Tim Fisher, Bandwidth, About.com http://pcsupport.about.com/od/termsb/g/bandwidth.htm. See also Alan Simpson, What is Bandwidth?, CoolNerds http://www.coolnerds.com/Newbies/Bandwidth/Bandwidth.htm.

[8] See Kenneth C. Laudon & Jane P. Laudon, Management Information Systems: Managing the Digital Firm, Case 1 (Pearson Education 2009).

[9] See id.

[10] See id.

[11] See id.

[12] See United States President Barack Obama, President Obama’s Statement on Keeping the Internet Open and Free, YouTube (Nov. 10, 2014) https://www.youtube.com/watch?v=uKcjQPVwfDk#t=17. See also Matt Clark, President Obama Wants Broadband Treated as a Utility, IGN (Nov. 10, 2014) http://www.ign.com/articles/2014/11/10/president-obama-wants-broadband-treated-as-a-utility

[13] See id.

[14] United States President Barack Obama, supra note 12.

Advertisements

Are We Owners or Merely Users? – PART II

By: Luis A. Velez, The IP Trend™ Blog

The first part of this article presented the current disparity between users of video games and copyright owners. The thin line separating the state of mind of both parties is the First Sale Doctrine (hereinafter “FSD”). With the digital era taking over, in this second part of the article we have to focus on the future issues that could face the copyright world while adjusting to the digital era.

The video game industry and their copyright protection have been visibly affected during the past couple of years due to the digitalization of games. Video game companies are facing turmoil with all the newly imposed Digital Rights Management (“DRM”) limitations towards consumers.[1] Users are losing the ability to own legally purchased works and copyright owners are increasing their ability to control those works. For users, it seems that game studios or console companies are finding a way to circumvent the law, creating DRMs to negate compliance with the FSD and destroy the secondary market for used games.[2] But for copyright owners, the FSD does not apply to digital works, thus their DRM limitations are legally constructed.[3] Their belief is that the establishment of an FSD for digital works would have a negative impact on protection and the market itself.[4]

The Digital Millennium Copyright Act (DMCA) committee follows the copyright owners’ idea stating that the FSD was meant for “hard copies” and not for digital works.[5] In a gaming environment, FSD will continue to protect the secondary market of used video games as long as games are distributed in hard copies (i.e. CD’s). Once digital video games become the norm, there would be no more protection through the current FSD.

The FSD was created to protect only the distribution rights of those who legally obtained a copy to the extent that they did not interfere with the reproduction rights.[6] The copyright owner exclusively holds the reproduction rights of the work.[7] Every time we download a digital file, the computer or console saves a copy. Every time it saves a copy, it results in the reproduction of the file we downloaded.[8] This is exactly what copyright owners intend to protect, the illegal and limitless reproduction of digital video games through digital distribution.

“Physical copies of works degrade with time and use, making used copies less desirable than new ones. Digital information does not degrade, and can be reproduced perfectly on a recipient’s computer. The used copy is just as desirable as (in fact, is indistinguishable from) a new copy of the same work. Time, space, effort and cost no longer act as barriers to the movement of copies, since digital copies can be transmitted nearly instantaneously anywhere in the world with minimal effort and negligible cost.”[9]

In a complete digital world, consumers would be able to purchase only the use (i.e. license) and not a copy of a video game. With the advancement in technology, the legal logic is that copyright owners are even more reluctant to transfer digital copies. The logic behind it is that if a digital FSD applies, transfers of digital copies would jeopardize their reproduction rights.[10] It is understandable that copyright owners, intending to fight piracy and to defend their position in the market, would prefer to sell a controlled use of their works than a free transfer of their ownership. The same rationale applied to the music, film and software industries.[11] The only difference between these industries and the video game industry is that gamers vocally intend to maintain the video game market in its status quo, defending their purchased access to technology.[12] They promptly protested before the video game companies had any chance to change the market from an uncontrolled offline-CD play everywhere experience to a fully digital file and always-online controlled experience.[13] Gamers once again gave the secondary market an opportunity to breath…for now.


[1] Keith Stuart, Xbox One DRM restrictions dropped after gamer outcry, The Guardian, http://www.theguardian.com/technology/2013/jun/19/xbox-one-drm-second-hand-restrictions-abandoned.

[2] See Mark C. Humphrey, Article: Digital Domino Effect: The Erosion of First Sale Protection for Video Games and the Implications for Ownership of Copies and Phonorecords, 42 Sw. L. Rev. 441, 445 (2013) citing David A. Costa, Vernor v. Autodesk: An Erosion of First Sale Rights, 38 Rutgers L. Rec. 213, 224 (2010-11). See also The National Telecommunications and Information Administration (NTIA), Report to Congress: Study Examining 17 U.S.C. Sections 109 and 117 Pursuant to Section 104 of the Digital Millennium Copyright Act, 6 (Mar. 21, 2001), available at http://www.ntia.doc.gov/report/2001/report-congress-study-examining-17-usc-sections-109-and-117-pursuant-section-104-digital..

[3] See id.

[4] See U.S. Copyright Office, DMCA Section 104 Report, 91 (2001), available at http://www.copyright.gov/reports/studies/dmca/sec-104-report-vol-1.pdf. See also NTIA, supra note 2 at 5; see Humphrey, supra note 2 at 448.

[5] See NTIA, supra note 2 at 5. See also U.S. Copyright Office, supra note 4, 80-83.

[6] See Bobbs-Merrill Co. v. Straus, 210 U.S. 339 (1908). See also U.S. Copyright Office, supra note 4 at 80.

[7] See id.

[8] See U.S. Copyright Office, supra note 4 at 79-80, 87. See also Humphrey, supra note 2 at 471-73.

[9] U.S. Copyright Office, supra note 4 at 82.

[10] See U.S. Copyright Office, supra note 4 at 79. “The ultimate product of one of these digital transmissions is a new copy in the possession of a new person. Unlike the traditional circumstances of a first sale transfer, the recipient obtains a new copy, not the same one with which the sender began. Indeed, absent human or technological intervention, the sender retains the source copy. This copying implicates the copyright owner’s reproduction right as well as the distribution right.”

[11] See, e.g., Vernor v. Autodesk, 621 F.3d 1102 (9th Cir. 2010) (software licensing); see also A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001) (music sharing).

[12] See Stuart, supra note 1.

[13] See id.

Are We Owners or Merely Users? – PART I

By: Luis A. Velez, The IP Trend™ Blog

This is a three-part publication, which raises questions regarding the new digital market and its effects in the video game industry. It analyzes the past and current attempts in redefining the industry and how they could potentially affect the legal doctrines that protect not only copyright holders but also users.

The video game industry is evolving into a technological monster. It is affecting the way we access and purchase video games. Console manufacturers propose a digitally consumer monitored relationship through their online services. In the past, consoles were only purchased to play games. Now, consoles are manufactured as mechanisms with integrated utilities (e.g. watching movies, accessing email accounts or Internet services). The services integrated in consoles didn’t affect the gaming experience until 2013. The E3 press conference held in 2013 is the industry’s latest attempt in redefining the whole gaming experience. Microsoft’s E3 press conference raised some Digital Rights Management (hereinafter “DRM”) concerns by stating: “games would need to be fully installed onto systems before play and that each copy would then be watermarked to its owner. Attempts to then sell on or give away the boxed copy of the game would be controlled by Microsoft”.[1]

The proposal, although innovative, would undermine the secondary market (i.e. trading, reselling or sharing video games). Gamers stood up against the adherence of this newly controlled relationship, making the company rethink its proposal. The company later abolished its DRM reform and apparently we all live happily ever after…for now. As a lawyer and a gamer, I ask the following: are we purchasing the right to own a video game or are we purchasing a mere right to use a video game (license)? Does it make a difference if we own a hard copy or a digital copy? Does the transition of tangible to digital copies destroy the copyright limitations imposed to copyright holders?

A quick analysis will determine that we are actually purchasing mere licenses to play/use video games (e.g. similar to other types of computer software). This could be answered through the Terms of Use of each company’s digital material.[2] But, are average users falling merciless into the hands of voluminous technical contracts? Gamers did not need to read a voluminous contract or have the presence of a lawyer to purchase their favorite video game in a retail store. Are companies suggesting that gamers have a lawyer on call to read the contracts every time they make an Internet purchase? Are companies creating an unaffordable technology atmosphere negating its full enjoyment?

Too many questions! Fortunately, there are legal policies that could address the issues above. Even if there is only a clear mere right to use, we need to discuss how policy interacts with this uneven relationship. There is a contract relationship inclined to benefit only one side (i.e. the copyright holder).[3] A policy analysis will support a just determination attending the reasonable concerns raised by those who paid value for its use. I will discuss the policy analysis in the Second and Third Part of this article. To be continued…


[1] Keith Stuart, Xbox One DRM restrictions dropped after gamer outcry, The Guardian, http://www.theguardian.com/technology/2013/jun/19/xbox-one-drm-second-hand-restrictions-abandoned.

[2] Mark C. Humphrey, Article: Digital Domino Effect: The Erosion of First Sale Protection for Video Games and the Implications for Ownership of Copies and Phonorecords, 42 Sw. L. Rev. 441, 456 (2013).

[3] See id. at 459.

The Copyright Protection Behind an Animal’s Selfie!

By: Luis A. Velez, The IP Trend™ Blog

“A copyist’s bad eyesight or defective musculature, or a shock caused by a clap of thunder, may yield sufficiently distinguishable variations. Having hit upon such a variation unintentionally, the ‘author’ may adopt it as his and copyright it.”[1] 

An accidental effort can create an original work subject to copyright protection. According to case law, the “author” can adopt an unintentional variation. Can we consider the mere fact that a photographer unintentionally gave the camera to an animal as effort? If an animal takes a picture, who can file for copyrights of the picture? According to The Guardian, the United States Copyright Office (hereinafter “USCO”) said: “The Office will not register works produced by nature, animals, or plants. Likewise, the office cannot register a work purportedly created by divine or supernatural beings, although the office may register a work where the application or the deposit copy states that the work was inspired by a divine spirit.”[2]

We know an animal, by itself, can’t file its work in the USCO. But overall, if the photographer owns the camera (i.e. the tangible medium of expression), should he be awarded at least with the exclusive right of reproduction? We know the photographer owns the camera, but is he the author of the picture according to the current U.S. standard?

The originality test consists of “something more than a merely trivial variation, something recognizably his own.”[3] “The originality requirement for copyright protection is not particularly rigorous.”[4] The standard of originality that the courts of the United States hold today demands the author’s independent conception and a low quantum of creativeness that he or she employed in his or her work.[5] “A work is original if it is the independent creation of its author. A work is creative if it embodies some modest amount of intellectual labor.[6] Thus, creativity is deeply rooted to the originality concept and an author needs to invest some intellectual effort to create a work independently. Courts have developed a two-prong test: independent effort and a modicum of creativity (however, there is not an exact description of how an author could attain the independent effort and the amount of creativity required).[7] Furthermore, the USCO and/or courts freely decide an author’s effort. 

Now, I suggest we read again the first paragraph of this article and ask: what if the photographer intended to take the picture but the animal unintentionally took it, should the author adopt the animal’s unintentional effort as his own? According to the low modicum of creativity and the minimum independent effort required, should we consider the author’s efforts of owning the camera, traveling to the area and/or having the camera prepared to take the pictures of the monkey?

Don’t get me wrong, I concur with the Copyright Office! But the U.S. Judicial System needs to clarify and redefine the originality concept for copyrights. It needs to be more descriptive and stringent. The current “low modicum of creativity and independent effort” standard continues to open the door for confusion and debate.


[1] See Alfred Bell & Co. v. Catalda Fine Arts, Inc.,191 F.2d 99 (2d Cir. 1951).

[2] Samuel Gibbs, Monkey business: macaque selfie can’t be copyrighted, say US and UK, The Guardian, http://www.theguardian.com/technology/2014/aug/22/monkey-business-macaque-selfie-cant-be-copyrighted-say-us-and-uk.

[3] See L. Batlin & Son, Inc. v. Snyder, 536 F.2d 486, 490 (2d Cir. 1976).  See also Alfred Bell & Co. v. Catalda Fine Arts, Inc., 191 F.2d 99, 103 (2d Cir. 1951).

[4] Greenspan v. Random House, Inc, 859 F. Supp. 2d 206, 216 (D. Mass. 2012).

[5] See Craig Joyce, Marshall Leaffer, Peter Jaszi & Tyler Ochoa, Copyright Law, 82 (LexisNexis, 8th ed. 2010).

[6] See Durham Indus., Inc. v. Tomy Corp, 630 F.2d 905, 911 (2d Cir. 1980) citing Batlin, 536 F.2d at 490. Accord, Donald v. Zack Meyer’s T.V. Sales and Service, 426 F.2d 1027, 1029-30 (5th Cir. 1970), cert. denied, 400 U.S. 992, 91 S.Ct. 459, 27 L.Ed.2d 441 (1971). See also Batlin, 536 F.2d at 490, citing Herbert Rosenthal Jewelry Corp. v. Grossbardt, 436 F.2d 315, 316 (2d Cir. 1970); see Puddu v. Buonamici Statuary, Inc., 450 F.2d 401, 402 (2d Cir. 1971) (discussing the quantitative test of originality characterized as “modest”, “minimal”, and as establishing “low threshold.”).

[7] See Batlin, 536 F.2d at 490. See Alfred Bell & Co. v. Catalda Fine Arts, Inc., 191 F.2d 99, 102-03 (2d Cir. 1951); Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d 49, 54 (2d Cir. 1936), aff’d, 309 U.S. 390 (1940), 60 S.Ct. 681, 84 L.Ed. 825 (1940).