{"id":2954,"date":"2005-02-14T17:03:29","date_gmt":"2005-02-14T21:03:29","guid":{"rendered":"http:\/\/blogs.law.harvard.edu\/cmusings\/2005\/02\/14\/cato-releases-report-on-p2p-and-drm\/"},"modified":"2005-02-14T17:03:29","modified_gmt":"2005-02-14T21:03:29","slug":"cato-releases-report-on-p2p-and-drm","status":"publish","type":"post","link":"https:\/\/archive.blogs.harvard.edu\/cmusings\/2005\/02\/14\/cato-releases-report-on-p2p-and-drm\/","title":{"rendered":"Cato Releases Report on P2P and DRM"},"content":{"rendered":"

<\/a><\/p>\n

Cato recently published <\/font>Peer-to-Peer Networking and Digital Rights Management: How Market Tools Can Solve Copyright Problems<\/span> <\/font><\/font><\/a>by Michael Einhorn and Bill Roseblatt (link via<\/font> PaidContent<\/font><\/a>).  Rosenblatt has a nice summary up at <\/font>DRMWatch<\/font><\/a>.  The key grafs:<\/font> <\/p>\n

\n

This
\nwhite paper takes a view of the controversy between content owners and
\nP2P networks that favors neither one nor the other.  Instead, it
\nfavors an invisible third party: the “unseen hand” of the free
\nmarket.  The paper explains economists’ concepts of market
\nbehavior such as versioning (creating different versions of products or
\nservices to appeal to different market segments) and creative
\ndestruction (emergence of new business models, through market forces,
\nwhich may be destructive to existing businesses or industries). 
\nIt then cites various examples of how DRM technology is bringing these
\nconcepts to life.<\/font><\/p>\n<\/div>\n

More
\nspecifically, the paper posits that DRM and peer-to-peer networking are
\ncomplementary technologies — not mutually exclusive ones — that can
\nbe integrated to form potentially attractive new content
\nservices.  It provides some examples of nascent attempts to do
\njust that.  DRM-based services have been appearing that include
\nfeatures inspired by P2P, such as MusicMatch’s <\/font>“share with your friends” feature<\/font><\/a> and the increasing numbers of <\/font>CD burns<\/font><\/a>
\nthat various services allow.  The paper asserts that it’s not just
\nthe presence of illicit P2P networks that induce content owners to
\nlicense their content to more consumer-friendly DRM-based services;
\nother market forces such as vigorous competition and consumers’
\nreasonable expectations of content usage also contribute to current
\ndevelopments.”
<\/font><\/p>\n

The paper as a whole is pretty good, and I agree with several aspects of it.  However, two key pieces are left ambiguous:
<\/font><\/p>\n

1. 
\nThe paper supports allowing DRM implementation to continue and cautions
\nagainst government intervention.  However, it does not speak to
\nthe role of the DMCA in protecting DRM.  The paper briefly
\ncautions against “relaxing access protection,” but it doesn’t say what
\nthis amounts to.
<\/font><\/p>\n

This
\nhas particular bearing on their discussion of DRM’s social costs and
\nbenefits.  It is one thing to point ut how new business models
\nbuilt on versioning and price discrimination may provide general public
\nbenefits, as the authors do in this paper.  It is quite another to
\nsay that, because DRM facilitates market transactions regarding
\nnon-infringing uses, people should no longer  have the right to
\ncontinue exercising the rights which the Copyright Act reserves to
\nthem.  It is quite different still to say that, because DRM may
\nprovide certain social benefits, we ought to protect it with the DMCA.
<\/font><\/p>\n

The
\nauthors actual feelings on these points is not entirely clear to me. I
\nhope to have more to say on these issues later, but, for now, see <\/font>this previous post<\/font><\/a> on understanding DRM.
<\/font><\/p>\n

2.  The paper notes that Grokster<\/span>
\nprovided part of the impetus for new music services, including those
\nthat leverage P2P (e.g., Weedshare, the forthcoming Mashboxx). 
\nSeemingly, the resulting innovation is a positive result. 
\nFurthermore, the paper states that new technologies should be allowed
\nto evolve and that the government should not intervene to stem the tide
\nof P2P. The authors specifically criticize the INDUCE Act. 
\nHowever, the paper seems to say that the Supreme Court should reverse Grokster<\/span>. 
\nOn pg 12, the authors only discuss possible Court resolutions that
\nwould expand secondary liability.  The authors also state that “In
\nthe absence of an efficient resolution by the Court, Congress may pass
\nlegislation that may interfere with both technological evolution and
\nfree-market processes.”  May?  Does that mean should? 
\nIndeed, if it’s right for the Court to intervene here, why would it be
\nwrong for Congress to do so?
<\/font><\/p>\n

Both
\nthese points of ambiguity highlight an important aspect of the current
\ndebate surrounding Grokster: what does it mean to support “market
\nforces” or the “free market”?  The paper’s conclusion is that
\nmarket forces will resolve copyright holders’ concerns and the
\ngovernment should stay out.  Yet, many would say that the DMCA and
\nextended secondary liability are unfortunate interventions in the
\nmarket.  In <\/font>Free Culture<\/font><\/span><\/a>,
\nProfesor Lessig treats these measures in protectionist terms, arguing
\nthat “in a free society, with a free market, supported by free
\nenterprise and free trade, the government’s role is not to support one
\nway of doing business aginst others. Its role is not to pick winners
\nand protect them against loss” (127-128).  The Cato authors
\nsimilarly say that “Goverment … should not pick winners or discourage
\nany technology from competing in the new marketplace.”  So what
\ndoes it really mean to support market forces? Patrick Ross recognizes
\nthis aspect of the debate in a<\/font> recent post.<\/font><\/a>
<\/font><\/p>\n

It
\nseems that part of the distinction in usage of “market forces” comes
\nfrom different views of how and why we create a market for copyrighted
\ngoods. Do we create a market through a property right essentially as we
\ndo for physical goods?  If we do, then a well-functioning market
\nseems to rest on things like the DMCA or broader secondary
\nliability.  Or does copyright’s purpose allow conception of that
\nright that is more flexible, that does not demand extension into every
\ndomain?  Market forces may drive copyright holders to adjust to
\nnew technologies may be sufficient – through competition and
\ninnovation, copyright holders may be able to achieve sufficient
\ncompensation, sustaining creativity.  (Note: I am not
\narguing about whether copyright is “property” or “policy.”<\/a>  It’s a
\nkind of property.  But how far that right ought extend is an open
\nquestion.)
<\/font><\/p>\n

Much more to say about the Cato paper and these topics, but that will have to do for now.
\n<\/font><\/p>\n

[12:23 AM – edited for clarity]
\n<\/font><\/p>\n","protected":false},"excerpt":{"rendered":"

Cato recently published Peer-to-Peer Networking and Digital Rights Management: How Market Tools Can Solve Copyright Problems by Michael Einhorn and Bill Roseblatt (link via PaidContent).  Rosenblatt has a nice summary up at DRMWatch.  The key grafs: This white paper takes a view of the controversy between content owners and P2P networks that favors neither one […]<\/p>\n","protected":false},"author":72,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[84],"tags":[],"class_list":["post-2954","post","type-post","status-publish","format-standard","hentry","category-general-news"],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/posts\/2954","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/users\/72"}],"replies":[{"embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/comments?post=2954"}],"version-history":[{"count":0,"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/posts\/2954\/revisions"}],"wp:attachment":[{"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/media?parent=2954"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/categories?post=2954"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/cmusings\/wp-json\/wp\/v2\/tags?post=2954"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}