Chris Anderson posts on his Long Tail blog about an interview he had with Google’s economist-in-residence Hal Varian on the economics of free. It includes a list of 14 business models that allow creators to make money even if they can’t stop others from distributing it for free.
It attracted a comment from another author who describes the trend as attention based revenues displacing copy based revenues.
For the London Free Press – August 18, 2008
In a decision that has been termed a “crucial victory” and a “knockout decision,” a New York District Judge ruled that EBay was not responsible for policing and enforcing trade-mark infringement of goods posted for sale on the website. That decision is a radical departure from recent European decisions in France and Germany. The District Court Judge ruled that plaintiff Tiffany & Co. was responsible for policing and protecting its own trademark.
Therefore, host sites such as EBay are not responsible to police and review all goods placed for sale on its site.
As recently as June of this year, European courts have ruled in a drastically different way. In France, a French Tribunal ruled that EBay failed to effectively protect trade-marks such as Dior and Louis Vuitton, proved by the existence of numerous counterfeit items on EBay’s French website. In this case, EBay was ordered to pay an astounding US$61 million in damages.
In April, a German court set the European precedent when it ruled that EBay must protect against the sale of fake Rolex watches posted for sale on its website. The prevailing European attitude seems then to be that EBay must take responsibility for protecting trade-marked products and effectively stomp out the sale of counterfeit goods.
The New York District Court however did not agree with that logic. Although EBay does remove counterfeit items once it is notified by Tiffany & Co. that trade-mark infringement has occurred, the U.S. District Judge ruled:
“. . . the law is clear: it is the trade-mark owner’s burden to police its mark, and companies like EBay cannot be held liable for trade-mark infringement based solely on their generalized knowledge that trade-mark infringement might be occurring on their websites.”
Therefore, in the U.S., EBay cannot be held “pre-emptively” responsible for trade-mark infringement just because some of its sellers are advertising and selling fake goods. Prevalent public policy in the U.S., now recognized by the courts, instead puts the responsibility onto the trade-mark owner, most often the giant manufacturers.
EBay was also found to have acted responsibly in the past when faced with issues of trade-mark infringement. When trade-mark owners had issued concerns about possible infringement, EBay took all possible steps to remove the goods from its site. It also provides trade-mark holders with the software tools to search for possible counterfeit items.
Although this is a step in the right direction for trade-mark law, in the closely related area of copyright law, the decision has yet to appear as bright-lined. In the on-going litigation surrounding the lawsuit of Google/YouTube by Viacom for copyright infringement, the courts have yet to reach a definitive answer.
The potential of host-site liability for copyright infringement is therefore still undecided.
Tiffany has announced that it will appeal this decision. Hopefully the appeal court will agree with the trial court.
And hopefully the court deciding the Google/YouTube copyright issue will look back to the reasoning in the EBay case and see that holding host-site responsible for copyright infringement review and enforcement makes as little sense as it did for trade-mark infringement.
Techstuff Canada has a post that says the guys that created Scrabulous made a mistake when they renamed their game Wordscraper after the real Scrabble owner shut them down.
The posts states:
”I’ll add just one observation: I think Wordscraper is a terrible name. As John Dvorak observed recently on TWiT, newspapers loved this story because “Scrabulous” is a fun word.”
and goes on to say that:
I think the brothers could have bought themselves a lot of goodwill — and more positive press — if they had gone with a new name that’s more fun (and sillier) than Wordscraper. A name like Melvin, for example.
That’s a very good point. Good trade-marks or brands need to be memorable, not descriptive.
Unfortunately descriptive trade-marks are the first thing most people think of. The thought process is: “how else is anyone going to know what my brand/product/service is?” The right thought process is: “how can I make people remember my brand/product/service?”
One of the main issues with copyright reform is balance between protecting the creator, and reasonable expectations of consumers. An important aspect of that is to consider on a practical basis the extent that certain types and amounts of copying are not harmful to the creator. Indeed, some copying (sometimes referred to as “leakage”) can actually be beneficial to the creator. In other words, this is not a zero sum game – both sides can be better off with some copying.
Mike Masnick of Techdirt uses last weekend’s Batman Dark Knight debut to illustrates this point. It set a record for opening weekend box office sales – yet at the same time was easy to download online.
The press and blogosphere has been all over yesterday’s introduction of the copyright bill. The vast majority of the comments are negative, and rightly so. I don’t recall ever seeing so much commentary on legislation so quickly – it hasn’t even been 24 hours yet.
I’ll have more to say about this soon – but for now, take a look at Michael’s post, and his 3 posts below that with his comments and links to various comments and articles.
David Canton – For the London Free Press – January 7, 2006
The “Sony rootkit,” Sony-BMG’s recent attempt to prevent copying of its music CDs, has created a public-relations nightmare, angered privacy and security experts worldwide and exposed them to lawsuits.
Sony decided to use Extended Copy Protection (XCP) on 52 CD titles.
XCP is a rootkit, a program used by virus writers. It enters into a computer uninvited, copies itself to the “root” of a computer and hides its presence from the user by disguising itself as system files.
XCP is cloaked from detection from those wishing to remove it. It prevents the user from playing the CD in certain media player programs. The program transmits information back to Sony about the customer’s listening habits.
Sony dismissed complaints that XCP violated users’ privacy, arguing it was simply protecting its intellectual property rights. Sony relied on the End User License Agreement that appears on the screen when a CD with XCP is played on a computer. EULAs are standard for software, but unusual for music.
The EULA informed users the CD would install a “small proprietary software program” intended to protect the audio files.
The EULA also contained unusual provisions that, among other things, said the company can put backdoor programs on your computer that allow it to use self help to “enforce their rights” and if by doing so it destroys your computer or cause a security risk, it’s not responsible.
Many argued the EULA was insufficient, as it said nothing about installing cloaked files in the root of the user’s computer or transmitting information.
Security experts said computers could be vulnerable to viruses that use XCP’s cloaking feature. Sony claimed these concerns were theoretical until several viruses specifically designed to take advantage of the cloaking feature were discovered.
Sony provided a patch that removed XCP’s cloaking, allowing security software to detect these viruses. This did not placate critics as it did not actually remove XCP and installed new files that could not be removed without Sony-BMG’s consent.
XCP proved nearly impossible for users to uninstall manually without disabling their CD drive or triggering a system crash. When Sony finally offered an XCP uninstaller, users had to fill out online request forms, requiring information such as the user’s name and e-mail address.
This uninstall program caused as many problems as it solved.
Sony then temporarily suspended its use of XCP. It yanked XCP CDs from store shelves and offered replacements for already purchased CDs. About 4.7 million CDs had been shipped and 2.1 million sold. More than half a million networks have been infected.
Sony’s legal problems began when multiple class-action lawsuits were launched based on claims Sony violated U.S. state and federal laws against computer tampering and malicious software and has committed fraud, trespassing and false advertising.
The Texas attorney general filed a civil lawsuit, seeking $100,000 for each violation of that state’s Consumer Protection Against Computer Spyware Act.
There are now claims the XCP software can be prevented from installing merely by putting a piece of tape on a strategic spot on the CD.
So all in the name of copy protection, Sony-BMG has angered customers, musicians and retailers, lost sales, possibly breached privacy and computer trespass laws, exposed customers to viruses, allegedly used code in the XCP they were not licensed to use, denied and covered up what they had done and dismissed legitimate concerns as unfounded.
Leads one to wonder why Canada is considering amending its copyright legislation to make it illegal to defeat digital rights management software.