Law and Information

Here in Ottawa, I had the pleasure to speak at the OECD Technology Foresight Forum of the Information, Computer and Communications Policy Committee (ICCP) on the participative web – a forum aimed at contributing to the OECD Ministerial Meeting “The Future of the Internet Economy” that will take place in Seoul, Korea, in June 2008.

My remarks (what follows is a summary, full transcript available, too) were based on our joint and ongoing Harvard–St.Gallen research project on Digital Natives and included some of the points my colleague and friend John Palfrey and I are making in our forthcoming book “Born Digital” (Basic Books, 2008).

I started with the observation that increased participation is one of the features at the very core of the lives of many Digital Natives. Since most of the speakers at the Forum were putting emphasis on creative expression (like making mash-ups, contributing to Wikipedia, or writing a blog), I tried to make the point that participation needs to be framed in a broad way and includes not only “semiotic democracy”, but also increased social participation (cyberspace is a social space, as Charlie Nesson has argued for years), increased opportunities for economic participation (young digital entrepreneurs), and new forms of political expression and activism.

Second, I argued that the challenges associated with the participative web go far beyond intellectual property rights and competition law issues – two of the dominant themes of the past years as well as at the Forum itself. I gave a brief overview of the three clusters we’re currently working on in the context of the Digital Natives project:

• How does the participatory web change the very notion of identity, privacy, and security of Digital Natives?
• What are its implications for creative expression by Digital Natives and the business of digital creativity?
• How do Digital Natives navigate the participative web, and what are the challenges they face from an information standpoint (e.g. how to find relevant information, how to assess the quality of online information)?

The third argument, in essence, was that there is no (longer a) simple answer to the question “Who rules the Net?”. We argue in our book (and elsewhere) that the challenges we face can only be addressed if all stakeholders – Digital Natives themselves, peers, parents, teachers, coaches, companies, software providers, regulators, etc. – work together and make respective contributions. Given the purpose of the Forum, my remarks focused on the role of one particular stakeholder: governments.

While still research in progress, it seems plain to us that governments may play a very important role in one of the clusters mentioned above, but only a limited one in another cluster. So what’s much needed is a case-by-case analysis. I briefly illustrated the different roles of governments in areas such as

• online identity (currently no obvious need for government intervention, but “interoperability” among ID platforms on the “watch-list”);
• information privacy (important role of government, probably less regarding more laws, but better implementation and enforcement as well as international coordination and standard-setting);
• creativity and business of creativity (use power of market forces and bottom-up approaches in the first place, but role of governments at the margins, e.g. using leeway when legislating about DRM or law reform regarding limitations and exceptions to copyright law);
• information quality and overload (only limited role of governments, e.g. by providing quality minima and/or digital service publique; emphasis on education, learning, media & information literacy programs for kids).

Based on these remarks, we identified some trends (e.g. multiple stakeholders shape our kids’ future online experiences, which creates the need for collaboration and coordination) and closed with some observations about the OECD’s role in such an environment, proposing four functions: awareness raising and agenda setting; knowledge creation (“think tank”); international coordination among various stakeholders; alternative forms of regulation, incl. best practice guides and recommendations.

Berkman Fellow Shenja van der Graaf was also speaking at the Forum (transcripts here), and Miriam Simun presented our research project at a stand.

Today and tomorrow, the OECD delegates are discussing behind closed doors about the take-aways of the Forum. Given the broad range of issues covered at the Forum, it’s interesting to see what items will finally be on the agenda of the Ministerial Conference (IPR, intermediaries liability, and privacy are likely candidates.)

The OECD has just released what – in my view – is the first thorough high-level policy report on user-created content. (Disclosure: I had the pleasure to comment on draft versions of the report.) From the introduction:

The concept of the ‘participative web’ is based on an Internet increasingly influenced by intelligent web services that empower the user to contribute to developing, rating, collaborating on and distributing Internet content and customising Internet applications. As the Internet is more embedded in people’s lives ‘users’ draw on new Internet applications to express themselves through ‘user-created content’ (UCC).

This study describes the rapid growth of UCC, its increasing role in worldwide communication and draws out implications for policy. Questions addressed include: What is user-created content? What are its key drivers, its scope and different forms? What are new value chains and business models? What are the extent and form of social, cultural and economic opportunities and impacts? What are associated challenges? Is there a government role and what form could it take?

No doubt, the latest OECD digital content report (see also earlier work in this context and my comments here) by Sacha Wunsch-Vincent and Graham Vickery of the OECD’s Directorate for Science, Technology and Industry is a must-read that provides plenty of “food for thought” – and probably for controversy as well, as one might assume.

Two new documents by OECD on digital media policy. The first report is the official summary of the OECD – Italy MIT Conference on the Future Digital Economy: Digital Content, Access and Distribution (see Terry Fisher’s main conclusions and the interesting policy items at the end – monopoly of search engines, DRM, user-created content).

The second report is an OECD study on Digital Broadband Content: Digital Content Strategies and Policies. As complement to the above conference, this OECD study identifies and discusses six groups of business and public policy issues and illustrates these with existing and potential OECD Digital Content Strategies and Policies.

Professor Terry Fisher has the difficult job, as the Day 1 Rapporteur, to present in 10 minutes the OECD conference conclusions. Here are the main points he made a few minutes ago:

A. Points of agreement (or at least substantial consensus)

(a) Descriptive level:
o We’re entering a participatory culture, active users, explosion of blogs; differences in web usage.

(b) Predictive level:
o Consensus that we’ll see a variety of applications that will florish; the shift to biz models that incl internet distribution will have long tail effects, increase diversity

(c) Level of aspiration:
o We should aim for a harmonized, global Internet – single, harmonized global approach (vs. competing legal/regulatory frameworks)
o Governments should stay out, but broad consensus of 6 areas where governmental intervention is desirable: (1) Stimulating broadband; (2) fostering universal access (bridging dig.div.); (3) educating consumers; (4) engage in consumer protection against fraud, spam; (5) fostering competition; (6) promoting IP to achieve an optimal balance
o We should attempt to achieve “biz model neutrality” (TF’s personal comment: appealing idea, but infeasible, there’s no way to achieve it.)

B. Points of disagreement

(a) Descriptive level
o Whether IP currently does strike optimal balance (yes, middle ground, no – spectrum of positions)

(b) Predictive level
o Which biz strategy will prevail: pay-per-view; subscription; free-advertisement based model?

(c) Level of aspiration:
o Network neutrality: required or not as a matter of policy
o TPM: Majority: yes, smaller group: no; intermediate group: only under certain conditions.
o Should governments be in the biz of interoperability?
o Using government power to move towards open doc format?
o Government intervention to achieve an Internet that is open vs. variations of a walled-gardened net?

Here are the keywords I wrote down during Marybeth Peters’ (U.S. Register of Copyrights, United States Copyright Office) statement here in Rome, which she delivered in the context of the final policy roundtable aimed at identifying priority issues, tools, and policy challenges.

• We must adjust our copyright laws to the digital environment. Copyright law has always responded to new technologies.
• Must be an internationally coordinated response due to the global nature of the Net.
• If copyright owner choose to use TPM, those TPM must be protected. Both copy & access controls.
• Key questions to ask: Are there new rights that are required to protect creators? But also: Do we need new exceptions (e.g. for libraries). Third, what are appropriate remedies (e.g. criminal penalties).
• Other important set of question: Who is the infringer (primary vs. secondary). This issue comes up in P2P context (Kazaa, Grokster, etc.) Secondary liability must be considered at the international level.
• Licensing issues: To be saved for the marketplace, no government intervention required. Consumers know what they want. Strongly opposed to compulsory licensing (costly, ineffective). Instead: DRM, collective administration to solve the problem.

I had the pleasure to chair a panel on new user habits and social attitudes at the OECD’s Rome conference entitled “The Future Digital Economy: Digital Content Creation, Distribution and Access.” On the panel was a wonderful group of experts:

• Dr. David Day, Nielsen’s/Net Ratings’ Director for Europe, the Middle East and Africa was presenting data on Internet use and online behavior with focus on the EU;
• Dr. John Horrigan, Associate Director for Research at the Pew Internet & American Life Project presented recent surveys on broadband usage in the U.S.;
• David Sifry, Founder, President and CEO of Technorati was talking about the development and measurement of weblogs as well as the overall evolution of the blogosphere
• Frieda Brioschi, President Wikipedia and Wikimedia Italy, shared thoughts about current trends and developments in peer-production projects like Wikipedia; and
• Dr. Jens Uwe Intat used the case of games to show how emerging user habits and social attitudes are changing the ways we consume entertainment.

From David Day’s and John Horrigan’s presentations I caught the following data points:

• More than 150 million W Europeans with Internet access and still growing.
• 95% of established Internet users are using the Net at home, 49% at work, 23% at educational institutions, 18% in the Internet cafe, 14% in public libraries.
• The top-device to access the Internet is the Pc/Mac (91%), followed by laptop (33%), mobile phones (18%), digital TV (5%), PDAs (4%) and game consoles (4%).
• Typical online behavior in a month includes: search (94%), general interest/portals (86%), web services/internet tools (75%), mass merchandisers (73%), auctions (66%), email (54%), online banking (53%) and community sites (53%).
• 36% of adult Americans have high-speed connections at home.
• The following percentage of the age group 35 & under has ever been engaged in the following activities: 20% blog; 39% sharing creative work online; 35% sharing any online content.
• A December survey by Pew shows that having a broadband connection at home continues to have a transformative impact on users. The three areas of impact are: (i) increased reliance on the Internet for news and information; (ii) heavy use of the Internet for gaming and entertainment; (iii) use of the Net to satisfy creative needs (amateur content production).

Here are my personal take home points from the panel discussion:

Empirical as well as anecdotal evidence (case studies) suggest fundamental changes in the way we access, use, create, and distribute information, knowledge, and entertainment.

(1) Access:

• Broadband has arrived and is creating a critical mass.
• In large part due to broadband technology, the Internet is increasingly embedded in our daily lives.

(2) Use:

• Technology matters, too, not only specific user demographics.
• We heavily use services that require some sort of content intermediaries (search engines, news aggregators, games).

(3) Creation:

• Weblogs play a key role in bottom-up content creation, both in the EU and the US.
• Peer-produced projects such as Wikipedia are prime examples of new modes of content production

(4) Distribution:

• Large-scale P2P file-sharing, for legitimate and illegitimate purposes, is persistent.
• Increasingly important is sharing of self-created content.

In conclusion, it seems to me that we are at the beginning of a long, multi-layered discussion that is likely to be increasingly centered on access and creation rather than (P2P) distribution.

The OECD will soon release an interesting study on digital content in scientific publishing, which analyzes scientific publishing’s new business models, including open access publishing, open access archives and repositories, and subscription bundling and site-licensing, their impacts on science and diffusion of knowledge; and the role of governments in enhancing access to publicly funded research.

Among the main findings are:

• Scientific publishers have invested heavily in online publishing and in 2003 75% of scholarly journals were available online.
• Overall, the balance is shifting towards direct access to primary data sources, which is having major impacts on publishers.
• Three major business models depending on digital delivery are emerging: The so-called “big deal”, open access publishing, and open access archives and repositories.
• Change is driven by mounting user needs to access increasing volumes of research data and information, new ICT applications and development of digital content and digital access technologies, and greater cost transparency and competition in publishing and distribution of information.

The OECD study also contains policy recommendations. Among them are:

• Enabling maximum access to findings from publicly funded research in order to maximize social returns on public investments.
• Coordinated efforts at national and international levels are needed to broaden access to data from publicly funded research.

As with the other reports published as part of the OECD Digital Broadband Content Project, the OECD secretariat has done a terrific job– both in terms of stocktaking and looking forward.

Check out the Berkman Center’s website for reactions. It turns out that the entertainment industry still does not like the study. We’ve also made public our comments on the draft OECD report on digital music.

Find here a terrific report by the OECD on the digital music industry (pre-release.) The report includes, inter alia, references to Terry Fisher’s seminal book Promises to Keep as well as to the Berkman Center’s iTunes case study.

The report concludes that online music distribution will grow significantly over the next few years, will force the music industry to reconsider their business models, and will continue to pose regulatory challenges to governments. The study includes a detailed impact analysis of digital music distribution on artists, consumers, the record industry, and new intermediaries.

The OECD underlines the positive potential of digital distribution, both as a new business model and a cultural phenomenon. It’s report further concludes that Internet-based piracy may be reduced, if licensed file-sharing and new forms of superdistribution evolve.

The study, part of the OECD Project on Digital Broadband Content, is the outcome of work involving a wide range of stakeholders, including many governments. It’s among the first roadmaps exploring as to how public policy should be re-evaluated in this space.

The Berkman Center’s Digital Media Team was invited to comment on a draft version of this report. Today, we congratulate the study’s authors to a thorough multi-stakeholder analysis, written in a challenging environment.

Stay tuned.

Update: The OECD report is also featured in the latest edition of The Economist (subscription required.) See also WIRED News with reactions from IFPI.

Interesting Wired article on a French judge’s critical take on the copyright industry’s battle against file-sharers, copy-fighters, and the like. With great comments from my colleague at OECD, Sacha Wunsch-Vincent: “Now is the time for the content industry, access and technology providers to get out of courts and back to business.”