Protection of Content Providers' Rights in the Digital Era

Content

Introduction

The "information revolution" is here. This is the digital era where electronic impulses can be manipulated, modified, and erased by just about anyone. It is doubtless that this new digital medium has much potential but it also poses serious challenges to copyright:[1] it can "easily wither away the intellectual property rights which have taken decades to be formally recognised."[2]

A very topical question is whether copyright should be expanded or trimmed down to allow society to function in this era. In particular, an interesting question of concern here is whether copyright law can protect the use of other people's material in multimedia [3] , on-line and digital medium.[4]

First, in Part I of this paper the background is set out and the key problems faced by the content providers are identified. After briefly reviewing the protection available to content providers under the current legislative scheme in Part II, the germane problem is identified in Part III. Then in Part IV some alternatives to protect the rights of content providers are explored. This paper in Part V submits that the preferable solution to deal with content providers' rights is through collective licencing. This solution facilitates the use of content providers' materials in multimedia products, without undue administrative and transaction cost; and at the same time acknowledge the content providers' right, and reflect the nature of the new medium.

The Nature of the Challenge

The world is undergoing an information revolution. Digital technologies are penetrating all aspect of our life: there are CD-ROMs, personal computers, on-line services, and the coming interactive TV services via the cable & satellite network. The number of people connected to the internet is expanding exponentially.

Digital technology, unlike analog technology, permits perfect replication of data, images, sound, etc, at very low cost and at great speed. [5] For the first time in history it is possible to produce a copy of something which is indistinguishable from the original. This fact is compounded by the scale and pace that this can occur. Anyone can easily download these materials, copy, modify, and redistributing it, without getting caught, without acknowledgment, and without payment to the original creator. The threats to the rights of the content providers are serious.

So how best to protect the rights of the content providers?

Content providers do not exist in a vacuum. An optimal protection needs to reflect the interests of the content providers, society, and public. The following outlines how the interests of these parties interact.

Interests of Content Provider, Multimedia Producers and Society

The interests of the content providers are very simple: they want some recognition for their time and effort in creating the materials. Some want monetary reward, while some just want to be acknowledged.

Meanwhile, publishers, or multimedia producers, are anxious to capitalise on this growing consumption of information products, from CD-ROMs to on-lines services. One of the quickest and lower cost means to create these products are to make use of existing materials. [6] Because of the content providers' copyright over these materials, the producers need to acquire or licence the right to use them.

The nature of the medium plus the uncertainty associated with the lack of an adequate regulatory framework turned this process into a nightmare: [7]

"As this industry began to take on form and vision, much excited speculation and wonder quickly turned to disbelief, if not outright horror, as creators began to understand what a labyrinth clearing right would be."

Currently the compilation of multimedia work is an extremely involving, time consuming, difficult,[8] and costly (high transaction cost in getting licences) [9] tasks.[10] The process involves locating many different parties that may be involved in a single work, complex and time consuming negotiation regarding the scope and extend of rights to be granted.[11]

Moreover, the lack of standard in the multimedia industry, payment of royalties is calculated on the same basis as traditional work; this often results in charge too high to be realistically used in a multimedia work.[12] The effect of all these is that "creators of multimedia products are reporting a fairly high percentage of refusals when seeking permission to licence the use of works in multimedia productions... [the uncertainties make it] easier to refuse."[13] This only serves to impede the progress of this emerging technology.

A Need for Balance

Up to now the regular surfers of the internet have come to expect that information and materials available on the net are free and that they can use it in anyway they want. Indeed, there is undoubtedly an attraction to the idea that digital information on the net is a "public goods"[14] such that it should be freely available.

However, this is a shocking denial of the content providers' right. It is not unreasonable that creators be rewarded for their efforts.[15] This is only fair.

Remember that while copyright may be seen as a property right, it is really "a regulatory device that is designed to alter incentives for authors and producers."[16] The sad truth is that without adequate recognition content providers may lack the incentive to produce new works,[17] and consequently progress in multimedia would slow and may even cease. This situation is bad for the content providers and the multimedia producers, as it is detrimental to the society. It is in the interest of society to encourage the development of contents and multimedia products to foster accumulation of knowledge[18] and sharing of ideas.

One current example is an emerging service called Webcasting.[19] Basically it is a service that transmits pre-programmed format of the information that a subscriber is interested in. Say the person is interested in US Stocks prices, current stocks information or news, current weather. The service will collate information from sources all over the internet and present the information in a simple to use interface, which could be through a computer or through a cable TV system. The benefits to the consumers are immense: it is quicker, there being no need to search for information, and it is less technologically alienating. However, the viability of such service would be put into doubt if they need to individually negotiate the right to use the "sources" of information. The need to present current information and the scale of the potential operation makes this highly impractical.

Ultimately, it is important to balance the rights of the content providers against the rights of society. The balance is not difficult to achieve in that at end the interests of the parties ironically converge (just like the technology); they have an incentive to co-operate. The content providers want reward, but without a properly set up scheme the multimedia producers would be reluctant to invest.

The need to seek a balance is an idea that is common in our legal system in trying to accommodate the interests of divergent groups. Indeed, balance has always been a part of the copyright law. For example, the copying of materials in university library. Despite some such copying may fall within the fair dealing provision, the rights of the author are recognised by using collecting societies which sample copying and pass on royalties to their members.[20] To attempt to block all infringement would be impractical, and in fact, highly detrimental to the society.

Protection of Contents Providers' Rights

The Current Framework

It has always been the purpose of copyright law to protect the interests of the author, the creator, in the work. It gives them control over how to exploit their work. Currently, the Copyright Act 1968 (Cth) ("the Act") governs the copyright law in Australia.

In Australia, as in other countries, copyright protection is given to different classes of "works", such as literary, dramatic, artistic and musical. In addition, so called Part IV copyrights give protection to "subject matter other than works", such as films, television and sound broadcasting and published editions of works. Copyright holders are given exclusive rights to reproduce, publish, perform, broadcast, transmit and make adaptations of a work,[21] and somewhat narrower rights over Part IV copyrights. The copyright holder can also assign their rights in any way they choose.[22]

In Australia this protection arises automatically (without need for registration) once the expression of a sufficient original idea has been reduced to a material form. This includes handwriting on paper, signals on tape, and indeed the creation of data by electronic means. Thus, e-mail, graphics, images, web pages and so forth are all protected by copyright.[23] For example, the opinions, comments, explanations, within a Web page (Yes this page itself!) would constitute literary works, the images (if created by the person) would constitute artistic works.[24]

Adequacy of Copyright Law

The protections of underlying materials, like pictures (graphics), sound, are very strong under the current regime. The question is whether such protections extend to the digital domain? It appears not. Foremost, technologically specific Act is unable to protect expression that does not fall within recognised subject matters.[25] For example, multimedia work and other materials produced in the digital domain have no recognised copyright categories.

Importantly even where the content is within a recognised category of copyright full protection is still doubtful. Take a photo for example. It would be classified as an artistic work with the associated exclusive rights under s31(2)(b). So if someone reproduced the entire photo on the WWW, they would infringe the copyright.[26] However, if only a small part of the photo is copied, is there an infringement? What if the publisher retouches the photo? Perhaps it is still arguable that there is an infringement if it can be established that it involved a substantial part of the work,[27] and that it bore similarity to the original photo. Notice though the latter criteria are often based on the subjective assessment of the judge.[28] The point is that the situation is far from clear; it is too vague to afford effective protection to content providers.

Fair Dealing- a loop hole?

It is sometimes suggested that the "fair dealing" exception would permit the unscrupulous exploitation of the content providers' right. While this may be true to so extend in the United State,[29] the better view in Australia is that it only applies to copying of limited amount of work for educational use (research and study (s40), criticism or review (s41)) and reporting of news (s42).[30] Also, its application depends on the type of use and on qualitative factors.[31] Once you begin to exploit the work commercially fair dealing ceases to operate. Thus, it seems fail dealing does not pose much of a threat to content providers in Australia.[32]

The Real Problem: Enforcement

The above suggests that the current copyright framework is ill equip for the digital challenge. It may be possible to fix, in a technical sense, the inadequacies it is most doubtful whether such technical fixes can in practice protect the content providers' rights.

In practice, the germane problem is the enforcement of the content holder's rights in this new digital medium. The nature of the problem is best epitomised by a question posed by John Perry Barlow: "If our property can be infinitely reproduced and instantaneously distributed all over the planet without cost, without our knowledge, without its even leaving our possession, how can we protect it?"[33] To summarise Barlow's thesis: information is not a property and not a noun, but a verb; information is an action that occupies time rather than space and which is experienced rather than possessed; information is not distributed but is propagated, and it can be transferred without leaving the original owner. In other words, the online medium is too fluid and vast to permit any effective policing. Most infringement would escape detection.

This problem possibly lessens somewhat in relation to multimedia that is not online, like CD-ROMs, insofar that such materials permit easier policing because of its physical manifestation. Still, the volumes of material involved, and the vast sources of contents, make any attempt to enforce protection of copyright a very formidable task.

A few specific problems in enforcement can be identified:

(a) As the traditional media of letters, journals, photographs, video & audio tapes and books merge into a single stream of undifferentiated electronic impulses, it becomes next to impossible to determine which version of a 'document' is the original or duplicate.

(b) Multimedia often incorporate bits and pieces from here and there. Attempt to locate infringement would require the tracing of each bit and pieces. This is very daunting and unrealistic.

(c) The fluid, non-linear, and interactive medium makes it difficult to determine who is the author.[34] How then do we get permission for copyright? Whose copyright has been infringed?

(d) The electronic world of cyberspace is a global medium with no national boundaries. The treatment of copyright is not identical in different countries.[35] Even if the laws are uniform, enforcement in the physical world is next to impossible given the lack of a coherent and efficient international enforcement regime. Indeed, any such network is likely to be so intrusive and expensive as to be impractical. In other words, physical enforcement is simply incapable of tackling the infinite universe of the cyberspace.[36]

(e) In this digital era, content providers are not restricted to the traditional authors, artists, etc. In this medium, anyone can be a multimedia producer and anyone can be a content provider. It would be next to impossible, and possibly not cost effective,[37] to enforce any attempt to charge all such users given the size and fluidity[38] of the online medium short of a comprehensive 'big brother' type surveillance (which raises privacy concerns from civil libertarian).

Protection of Content Providers' Right: Some Alternatives

Fundamentally, the purpose of copyright is to encourage the dissemination of ideas, opinions, inventions in out society, while at the same time provide a mean to recognise the effort of the authors or the creators by adequately compensating him or her.[39] The enforcement difficulties noted above and the lack of a proper framework have effectively constrained multimedia development. Thus, it is fair to say that the current regime is not adequate. The content providers are not adequately compensated, nor do the society benefit as much as it should from this revolution.

What can be done?

Modification of Existing Rights and Introduction of New Rights

Broadband Transmission Right

To deal with the challenges of the digital medium, the CLRC suggested that the categories of work be made broader and technologically neutral, and that the rights attached be simplified to two rights of distribution and transmission.[40] Also the notion of an "access right" have been suggested.

While such proposal seems logical, and would undoubtedly simplified the structure of the content providers' rights, the extend this new right allow copyright owner to control the transmission of their work over the superhighway is far from clear.[41] This solution is also unwarranted from an economic perspective.[42] Further, particularly the access right, as a matter of public policy it is objectionable because it is like a right to prevent use of the work.[43]

Moral Rights

The easy of digital manipulation in multimedia have raised the concern that moral rights[44] of content providers could easily be infringed. Thus its protection is advocated.[45] At the moment there are over sixty-five countries that have implemented moral rights legislation, and such legislation is likely to be introduced into Australian law during the life of the current parliament.[46]

Although moral rights are very relevant regarding multimedia and digital medium, the practicality of such rights in this new medium is doubted in that the enforcement of such rights is next to impossible.[47] For example, an artist may object to the reduction of the pictures colours to eight bits (drastically reducing the quality), or, to alter the aspect ratio of their picture, or to truncated the picture to fit the particular web page. Remembering that multimedia works often have dozens to hundreds of bits and pieces from varying sources. If the producer needs to seek permission and to consider the moral rights implication for using each bit and pieces, production of multimedia products would slow to a snail pace and may even cease all together.

In the end, it is submitted that addition of new rights would not achieve anything extra. It may be that with the convergence of technologies- that multimedia encompass a range of traditional copyright subject matters- there is an undeniable case to simplify the existing rights. But the core problem is still not solve: a transmission right assumed that transmission can be control, but in a digital medium this is exceptionally difficult, if not impossible. In other words, no matter how the subject matters of copyright are recategorised (or simplified), or, how the rights are expanded, enforcement still presents an insurmountable barrier.[48]

A 'Blank Tape Levy' Model

This essentially involves placing a levy on each blank CD-ROM, floppy disc or other storage medium.[49] Although this would provide a convenient mechanism to recover part of the royalties due to content providers, it only works in relation to the physical medium. As the information revolution is becoming increasingly online the effectiveness of this approach is limited.

A Technological Solution

One often cited solution to the problems posed by this new emerging technology is recourse to technology itself.[50] These technological solutions include:

(i) A self-monitoring system could be created to automatically record all uses and handle the payment of royalties.[51] The problem is that this tends to require lots of overhead and so adds to the transaction cost. Also, it requires that all users have some sort of devices to do the monitoring and transmit the data to some central databases, which is not realistic (at least for now) and far too invasive

(ii) Technology like encryption can be used to 'lock' the material.[52] This could be a good short term solution,[53] but a sole reliance on it to protect the rights of the content providers is still problematic. Not only does it constrain the flow of information on the net, it will be almost impossible to police: "One user can pay the fee and then digitally share the same information with others, with little risk of detection let alone prosecution."[54]

(iii) To address this defect, digital identification of the copyright materials to its individual bits can be used.[55] However, not only is the development of identifier for digital document more difficult than identifier for physical items, it is doubtful whether it is even possible.[56] Indeed, while it may be possible to digitally identify the work in general, but to identify it to its individual bits is questionable.

Thus, encryption offers only a partial solution. Ultimately, ethics and trust in society may offer the best protection of all (in an ideal world).[57]

Collective Licencing

A promising alternative seems to be the establishment of a voluntary licensing structure by forming a new collective agency.[58][59] Even the US White Paper takes the position that a licencing mechanism developed by the market place is preferable.[60]

The collective agency in functioning as a clearing house provides an easy mean to determine whether licence is available for the work and how much it cost. It provides a centralise administration of the paper works. It monitors use, licences the work, collects the royalties and enforces the rights. Thereby, increasing efficiency and reducing the transaction cost. In other words, it will give multimedia producers quick and direct access to the vast quantity of materials while given adequate reward to the content providers.[61]

Such a society is highly appropriate because:[62]

Great as this approach is, one author noted that this approach is tantamount to turning a "fundamental right into a type of taxation system... [eventually] copyright will be dead in 30 years."[63] So is the content provider's copyright protected? It seems that insofar they are adequately rewarded under this scheme their rights are recognised and protected. Unfortunately, it does little to strengthen content provider's moral rights. But then protection of moral rights is rather meaningless in this digital medium.

A Solution

The solution needed to address the content provider's rights in this new digital medium need to be a flexible one.[64] Flexibility is needed to achieve the necessary balance to accommodate the "fear of the content holders while enabling the multimedia developers to create original works."[65] It is far too shortsighted to focus on the rights of the content providers alone; the benefits this technology brings to the society should not be ignored:[66]

"The debate over the future of copyright law should not regard digital technology as a threat to the monopoly of copyright owners, but instead as a challenge to the current structure of creation and dissemination of information."

To this end, an expansion of the rights in copyright law is inappropriate: "...copyright law does not necessarily offer the best way to regulate traffic of intellectual property on the net."[67] The concern is that excessive regulation may stifle the development of multimedia.[68]

Rather, a balance approach reflecting the interests of the parties and the reality of the situation is required.[69] It is submitted that the preferable way to address the content provider's right is along the following lines.

1. While maintaining the automatic granting of copyright over works, whether in physical or digital form, it is important to reflect the reality of the medium. In this digital medium everyone can be content providers and publishers,[70] but not everyone wants monetary reward for everything he or she 'publishes' online.[71] Many people hold dear to the online tradition that information should be free.

2. To cater for the people who want to gain a financial reward a voluntary opt-in collective licencing arrangement should be created. A new collecting agency should be created along the line of existing collective agency like CAL and APRA. This regime is for content providers whose work originates in physical or digital form, and applies to work in any digital medium. The existing agencies retain their function over the non-digital medium.

3. However, the copyright of those who do not opt-in, probably the majority of casual user/content provider, cannot be ignored.[72] To address this some form of tribunal or commission could be set up to handle the matter in a more informal level that through the court system.

4. A general exception should be given for non-commercial use of the materials. Perhaps as an extension to the fair dealing defence in Australia.[73] For example, an average user, who are not commercial developers, but may want to use some such materials in their multimedia work, say on their WWW homepage. To require such a user to pay royalties is totally impractical,[74] and not to mention contrary to the expected idea of free flow of information on the net. The most they should be required is to acknowledge the source- giving due credit to the original creator.

5. Technology, like encryption, can be used to complement the collective licencing. For example, technology could facilitate the monitoring of infringement and the charging of royalties.

6. This is not to say that Copyright has no role in this new medium.[75] Nor is this paper suggesting that copyright law reform or simplification is unnecessary. The point is that an expansion of the rights in copyright law is inappropriate to address the problem, because the nature of the medium suggests that ultimately legal rules is likely to fail in the face of the enforcement barrier.[76] Anyhow, copyright law would still be needed to provide a framework for this collective licencing regime to function.

7. Ultimately, cooperation on an international level, or "global harmonisation",[77] is critical to the protection of the content provider's right. The global nature of this digital phenomenon calls for an international solution.

Conclusion

As we move into the digital era multimedia is likely to become an indispensable aspect of life. This is already happening. Its benefit to society, in particular the dissemination of information, is undeniable. This wonderful medium, however, can undermine the copyright of the content providers. Thus, it is in the interest of all parties to strike a balance.

The existing regime is incapable of achieving this balance. While changes to the copyright law is welcoming by making the regulatory framework more up to date. The view adopted by this paper is that reliance on copyright law alone is bound to fail, because the inherent nature of the medium ensures that effective enforcement is a rather illusory objective. In fact, Barlow may be right in saying that in this new medium copyright protection will rely not on the law but on people's ethics and conscience and reinforced by technology.[78] In the end the precise role of copyright law in this changing environment cannot be determined in isolation; there is need to take into account issues like privacy, security, surveillance, and "global harmonisation".[79]

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Modified on: 28th September, 1996.
Copyright ©1996 Raymond Yu