Tag: Mitch Stoltz

The EFF Taking on Big Tech?

Last week, CreativeFuture CEO Ruth Vitale wrote a post wondering whether she had stepped into a parallel universe upon reading a June 27 missive by the EFF’s Mitch Stoltz. Related to my last post on the theme of tech-utopians doing policy pirouettes in the current climate we call the “techlash,” Stoltz declared Big Tech too big, with “extraordinary power to censor and surveil.” Really? Welcome to the resistance, Mitch.

I know what Vitale means of course. The EFF has consistently endorsed policies that bolster the interests of Big Tech, namely internet companies, so Stoltz’s post does look like a staggering about-face begging for a jab in the ribs.  But taking his statement at face value, Stoltz’s main point is that the lack of competition in the internet market is dangerous, and he primarily advocates a re-invigorated approach to antitrust law as a solution. He writes…

“Restraining Internet giants’ ability to squash new competitors can help allow new services and platforms to arise, including ones that are not based on a surveillance business model. We also need new ways to measure and describe the harms of censorship and loss of privacy as a basis for antitrust analysis. Where these harms flow from abuse of monopoly power, or improper attempts to gain or maintain such power, regulators may need to consider breaking up companies as well.”

While I don’t see anything wrong with the EFF throwing its resources behind antitrust action against any big tech corporation, where it’s appropriate, I still maintain that certain web platforms are natural monopolies for which is there no public policy solution. Ain’t none of us got time for two Facebooks, so Facebook will retain its dominant position unless we all either migrate en masse to a platform we like better, or just bail on these types of platforms because we lose interest. In general, I suspect the challenges inherent to consolidation, combined with the prospects of automation, are far more complex and unprecedented than anything antitrust law was ever designed to address. But that’s another topic for another day.

Taking on Big Tech?  Really?

Meanwhile, a subsection of Stoltz’s post caught my attention because he mentioned that among the legislative reforms necessary to mitigate corporate dominance by the majors is Section 1201 of the DMCA. These are the statutes which provide for technical protections of copyrighted material and prohibit tampering with those protections for the purpose of infringing copyrighted material. But in the context of Stoltz’s new post, it has to be noted that the EFF in particular has advocated policy views on Section 1201 which, in some cases, would amount to a gift to Google—one of the aforementioned “too big” corporations Stoltz now says needs to be reined in.

For instance, in the Summer of 2016, there was a big row over the FCC’s proposal known as the “Set Top Box” Rule. If passed, it would have forced the TV cable companies to make programming and data available to third-party manufacturers of new boxes—naturally Google was in the lead among these—they would sell to consumers. The problem for TV producers was that the programming would, by federal mandate, have been made available to Google et al without any kind of licensing regime, thus bypassing the complex network of licensing among producers and distributors of TV programming that actually gets the show-makers paid.

The EFF, specifically Stoltz, declared that the proposed FCC Rule had “nothing to do with copyright” despite the fact that the proposal had a lot to with copyright, including the implication of Section 1201 because the current cable boxes we use are one form of technical protection of all those licensing deals that result in TV shows getting made.

Meanwhile, this “nothing to do with copyright” message re. the TV boxes was articulated by the EFF at about the same time that the organization filed suit against the government to have the entire statute declared unconstitutional. The EFF has a longstanding beef with 1201 (which is not without flaws), but both the EFF lawsuit and its public messaging on the subject tends to omit a considerable amount of complexity in the issue, seeking to draw readers toward the talking point that “copyright is standing in the way of…innovation, safety, consumer fairness, etc.”

That was essentially how the “Set Top Box” narrative was portrayed, even though it cannot be denied that passage of the FCC Rule would have been a major gift to Google, expanding both its market presence and its capacity to exploit what Stoltz described above as a “surveillance business model.” All while exploiting billions of dollars worth of programming without paying a cent in license fees.

Declaring 1201 Unconstitutional

In the Summer of 2016, when the EFF announced this litigation, I wrote a long post describing why I believed their case against 1201 was flawed—or at least why it was portrayed over-simply for public consumption. In general, complaints about this section of the DMCA seep into public perception as a prohibition against fixing our own cars or other devices because 1201 prohibits tampering with the tech that protects the software that runs so many products today. And then copyright in general gets a bad rap, which groups like EFF are happy to exploit in their messaging.

In fact, during that same period, PublicKnowledge launched an all-out smear campaign against the USCO, and then register Pallante, in part accusing the agency of favoring rightsholders with regard to its triennial Rulemaking process, which considers exemptions to 1201 protections for petitioners who file requests. In that case, PK actually vilified the USCO for deferring to other federal agencies that have an interest—in fact a more acute interest—in device tampering than copyright owners.

As explained my post at the time, the Register’s report revealed the opposite attitude of which it was accused—that not only was the USCO highly sympathetic to “good-faith researchers” seeking exemptions, but that the major hurdles to some of the exemptions being sought came from agencies outside the purview of the Copyright Office, including the Environmental Protection Agency, the Department of Transportation, and the Department of Justice. Suffice to say, the subject of device tampering is not simply a DMCA issue, and the DMCA is often a minor player in a bundle of regulations designed for consumer protection, environmental protection, etc. As a June 28, 2018 letter from DOJ counsel recommending some amendment to 1201 exemptions states …

“… the DMCA is not the sole nor even the primary legal protection preventing malicious tampering with such devices, or otherwise defining the contours of appropriate research. The fact that malicious tampering with certain devices or works could cause serious harm is reason to maintain legal prohibitions against such tampering, but not necessarily to try to mirror all such legal prohibitions within the DMCA’s exemptions.”

In other words copyright may be a factor with regard to device tampering—either for illegal or legal purposes—but it is quite often not the factor. To the extent DMCA may be inappropriately intertwined with other federal protections, that is a matter for Congress to consider, but that exploration seems unlikely to implicate the unconstitutionality of 1201 as a copyright protection regime. In the meantime, it is unhelpful when EFF acolytes like Cory Doctorow fire off misleading blurbs that distill the complexity of the Rulemaking process down to crazy shit like “copyright is the reason diabetics can’t get generic insulin.”

The EFF may yet demonstrate ways in which DMCA 1201 is helping to keep Big Tech too big (i.e. stifling competition), but the organization tends not to mention ways in which the statute has fostered innovation. For instance eReaders would not exist without technical protection measures that provide publishers and authors a reason to license digital versions of their books; and DRM these days is generally invisible to consumers, playing a role in the innovation called streaming. In this regard, if the EFF truly intends to take on Big Tech for anti-competitive practices, then welcome to the party; but their chronic assault on copyright law alone has only helped to foster and sustain the market dominance of some of the major companies now allegedly in their sights.

FCC Set-Top Box Proposal Is About Copyright

Let’s clear one thing up right off the bat. Consumers are not entitled to high-quality TV programming.  It’s a business. If that business doesn’t make sense, the shows won’t be produced.

I know that seems obvious, but as with so many arguments made by technology companies seeking to hijack the distribution of works for themselves, this latest one  seems to proceed from a typical assumption that the “content” will just be there no matter what.  As I said in an earlier post on this same subject, if the producers and distributors are correct in their criticisms, the FCC set-top box proposal could provide consumers with new methods of acquiring a lot less content over time.

In a nutshell, the TV programming we enjoy is made available because the producers (copyright owners) enter into licensing agreements with distributors, referred to as Multichannel Video Programming Distribution (MVPDs). Generically we tend to call MVPDs “cable providers,” but MVPDs include satellite and various other ways to receive television programming that has been licensed from the copyright owners.  These licenses sit on top of a network of other licenses between the producers and their suppliers, advertisers, etc. For instance, the actors on a show not only receive fees for their performances but also have residuals and health & pension plans paid through SAG from those licensing fees that are paid by the MVPDs.

Not to say it’s complex, but Register of Copyrights Maria Pallante, in her 17-page August 3rd letter to the FCC, referred to “a constellation of arrangements between MVPDs and program producers.”  Pallante further states …

“… the copyrighted works that make up an MVPD’s multichannel video programming are produced and made available to the public only as a result of complex, private negotiations between content owners and MVPDs, and on the understanding that the MVPDs will make works available to the public in accordance with the terms of the resulting licenses. Typically, a violation of the license terms will constitute either copyright infringement or breach of contract.”

What the FCC says it wants to do is to unchain consumers from the dreaded box — that thing we rent from the cable companies to unscramble the channels, and which symbolizes whatever frustrations we might feel with the service, the pricing, or the lack of competition in the pay TV market.  I feel these frustrations myself, so on the surface, Chairman Wheeler’s proposal to give me options to watch TV more flexibly—through tablets, smart TVs, and other products sounds appealing.  But there’s a bug.

The proposal would mandate that the MVPDs make their programming and data available to third-party manufacturers of devices (surprise, Google is one of these), who would not pay license fees but would be free to distribute, brand, and monetize with advertising as they see fit.  The producers and the MVPDs have argued that this circumvents the aforementioned network of complex and costly licensing; and some producing interests have also raised the concern that because these third-parties operate on web platforms, a more seamless integration between legal and illegal viewing may exacerbate the adverse effects of piracy on the market.

The Electronic Frontier Foundation asserts that none of the criticisms of the FCC proposal made by producers and MVPDs implicate copyright law at all.  Mitch Stoltz of the EFF this week argued that the proposal is exclusively about allowing new technology products to come to market and to provide consumers with new choices.  Interestingly, despite his insistence that the proposal has nothing to do with copyright, Stoltz—and Cory Doctorow in a companion EFF post—refers to one of the most important copyright cases to support this position.

Sony v Universal (aka the Betamax case) is the reason consumers may use recording devices for “time-shifting” TV programs for their personal use; and these proponents of the FCC proposal appear to be arguing that Sony provides the only precedent needed to reject any further consideration of copyright in this matter.  Stoltz writes …

“Copyright gives rightsholders power to control copying, but not technology design. In fact, that sort of control is the antithesis of copyright’s purpose. Over thirty years ago, in Sony v. Universal, the Supreme Court refused to allow movie studios to “extend [their] monopoly” into “control over an article of commerce”—the videocassette recorder—“that is not the subject of copyright protection.” Today, you can search all 280 pages of the Copyright Act, and you won’t find anything that says a copyright holder has the power to control search functionality, or channel placement, or to decide who can build a DVR or video app.”

But here’s what Register Pallante says about Sony in her letter to the FCC:

“Sony itself focused on the distribution of an article of commerce where the seller had no ongoing relationship with the purchaser after the sale, and no connection to the content being exploited.  Nor did the Court address fair use where the device distributor was itself engaged in copying activities, as opposed to private home users. Both of these factors could conceivably be present with respect to devices and services under the Proposed Rule.  Nor have courts gone so far as to obligate rights holders to provide content in a manner that would facilitate time-shifting or other non-infringing uses.” 

So, maybe the FCC proposal has a little to do with copyright.  And that word obligate is an important one, referring back to my opening note that there is no right to TV programming.  Its production has to make sense as a business, and that only works because of copyright.

A rights holder of any work has the discretion to make decisions about the manner in which that work is distributed.  This is in fact fundamental to copyright’s purpose.  If you write an autobiographical novel about a serious subject, for instance, not even your publisher may blithely repackage it with a steamy romance cover (unless you sign those rights away) because they think it will sell better.  But that’s basically what the third-party manufacturers want to do.  They want the federal government to compel MVPDs to deliver programming and data to them, for which they will not pay a license fee but will be allowed to distribute, package, and advertise against the works in any way they see fit.

The implications of that business model go well beyond the scope of mere gadget-making, clearly falling into the purview of copyright law.  Kevin Madigan on Mister Copyright summarizes the distinction between the device and the model thus:

“The difference with the current navigation device manufacturers is that they will receive copyrighted TV programs to which they’ll have unbridled liberty to repackage and control before sending them to the in-home navigation device. The third-party device manufacturers will not only be able to tamper with the channel placement designed to protect viewer experience and brand value, they will also be able to insert their own advertising into the delivery of the content, reducing pay-tv ad revenue and the value of the license agreements that copyright owners negotiate with pay-TV providers.”

That’s not what VCR’s (and now DVRs) do, and I’d be surprised if any court had much patience for a party relying heavily on Sony to support the FCC proposals. Additionally, as reported, the EFF recently took the bold step of suing the federal government on the grounds that Section 1201 of the DMCA is unconstitutional. Perhaps their assertion that the FCC proposal has “nothing to do with copyright” presumes that they have already won this argument because Register Pallante recognizes a “tension” between the FCC proposal and the 1201 anti-circumvention measures in the DMCA ….

“The Proposed Rule would inhibit the ability of MVPDs and content programmers to develop, improve, and customize technological solutions to protect their content in the digital marketplace.  It would do so in part by requiring MVPDs to give third-party actors access to copyrighted video content and associated data according to one or more security standards prescribed by an outside organization rather than through their preferred (and potentially more secure) protocols negotiated between copyright owners and the MVPDs. In addition, the Proposed Rule suggests that the FCC might allow third parties to self-certify their compliance with whatever security standards are adopted.  The Proposed Rule would thus undermine content creators’ ability to choose how best to protect their content in the marketplace, as Congress intended in enacting DMCA.”

Between Stoltz’s latest editorial and the recent suit over 1201, it seems the EFF is increasingly uninterested in working with copyright law and is focused on efforts either to abolish it or simply pretend it doesn’t exist.  This post is not meant to suggest that I can endorse every business practice of every MVPD, but the EFF’s assertion that these parties are “cloaking” anti-competitive practices in false claims about copyright is misleading.  Moreover, it should be abundantly clear by now that if the name Google is on the list of providers seeking a new regime from a federal agency, then customer choice and free-market competition are likely not at the forefront of that effort.

What Exactly Does the EFF Want?

As stated in my post announcing a voluntary agreement between MPAA and domain-name service Donuts, both rights holders and digital rights proponents should applaud this kind of B2B approach to mitigating online piracy.  That doesn’t mean I thought the latter parties actually would applaud it. And with the stalwart predictability of a honey badger, Mitch Stoltz of the Electronic Frontier Foundation fired off this missive, eager to criticize the agreement just hours after it came out of the shrink wrap.  The conditions of the agreement are so straightforward that it seems to me any honest acknowledgment of its terms might have stayed Stoltz’s hyperbolic pen before describing Donuts in this context as the “copyright police” or before beginning his post as follows:

“The companies and organizations that run the Internet’s domain name system shouldn’t be in the business of policing the contents of websites, or enforcing laws that can impinge on free speech.”

Right off the bat, Stoltz misrepresents the process as described in the agreement.  Donuts will not be “policing” any content at all.  Instead, the agreement outlines very specific conditions under which the MPAA may send a referral, backed by evidence, to Donuts regarding a domain that is “clearly and pervasively” engaged in large-scale piracy. At that point, Donuts has full discretion to choose to investigate further and to consider taking mitigating action consistent with its own Terms of Service.  That’s not quite the same as engaging a private company to “enforce the law” as Stoltz states. It is a voluntary effort by a company to uphold or comply with the law in its practices, which is consistent with the internal policies of corporations all over the world.  So, why is the broader rationale different with a domain name service provider? I know.  Because the Internet is special.

Meanwhile, shutting down, delisting, or blocking sites dedicated to enterprise-scale piracy via court-ordered injunction has occurred repeatedly for at least 15 years, and yet free speech has endured. So, it is hard to imagine how the free speech calculus changes if a private company—which has a clear, vested interest in keeping domains online—decides to not support a specific enterprise engaged large-scale infringement. But as we’ve seen in other contexts, the EFF is a place where imaginations run wild.  For instance, Stoltz writes:

“Taking away a website’s domain name means interrupting all of the speech that takes place on that site. It creates a much greater danger of censorship than suppressing individual pages or files. And the domain name system only works so long as most Internet users trust it to direct them to the websites they ask for, not only those that politically connected companies and repressive governments want them to see. That’s why domain registries and registrars shouldn’t take part in policing the contents of websites and services. And that’s why we’ll continue to fight the website-blocking power grab.”

So, here’s the bottom line of the agreement vis-a-vis Donuts’s role, with some important words in bold:

If Donuts is satisfied that the domain clearly is devoted to clear and pervasive copyright infringement, Donuts may, in its discretion and as permitted under its Acceptable Use and Anti-Abuse Policy, suspend, terminate, or place the domain on registry lock, hold, or similar status as it determines necessary to mitigate the infringement.

I have to admit the ability to translate that into “interrupting speech” or to invoke “repressive governments” is actually something of an art-form.  The EFF should probably give an award for Best Post Making a Mountain out of a Molehill (of course, I’ve never been invited to one of their dinners, so maybe they do).  Anyway, is Stoltz actually suggesting that if Donuts—and by extension other services—were to suspend domains under these types of guidelines, that this is a slippery slope toward censorship by order of a repressive government?  Why? How? Which repressive government?  China?  The Web is already massively censored in China, which is a human rights issue that has nothing to do with the mechanisms in this type of voluntary, anti-piracy initiative.

Here’s a news flash:  free speech doesn’t exist in several other countries.  And where free speech doesn’t exist, it cannot be infringed or chilled; it is instead a right yet to be won—a struggle largely separate from the exigencies of either Hollywood studios or Silicon Valley Internet companies, though both industries have a vested interest in a world where speech ultimately prevails. Meanwhile, in this country, there can be consequences for actually stifling someone’s speech, so Donuts has legal and financial incentive to proceed with due diligence in regard to any referral it receives. Moreover, it will be the case that any domain meeting the standards for referral by the MPAA will be an enterprise-scale infringer operating in a foreign country–not somebody’s blog.

Speech simply does not belong in this discussion, but since it is the perennial excuse for piracy, I think it’s worth mentioning, that piracy champions love to say that no measure can stop the major infringing sites because they will always move around the Web; but this same observation is never made about free speech itself, which is considerably more agile and infinitely larger in scope. The EFF might notice that there are trillions of expressions made every hour on the Internet, and no legislative or private-industry measure—at least in this country—is likely ever going to stop that.

At the same time, we might also keep in mind that the platforms we use for most of this speech–like the one I’m using right now–belong to corporations, and corporations sometimes fail.  In this regard, the EFF might consider that the Internet it so staunchly defends can be corrupted by piracy, which has been linked to malware and other scams that harm users and weaken the faith of advertisers in the digital ecosystem. After all, the major Internet companies don’t have hundred-million-dollar valuations because they’re platforms for free speech; they’re valued in the stratosphere because they are advertising and data mining businesses. And that’s fine, I guess, but let’s shed the illusion that these sites are run on principle.  Wall Street doesn’t invest in principle. They like money.

In this regard, I have to call particular attention to Stoltz’s statement that “the domain name system only works so long as most Internet users trust it to direct them to the websites they ask for ….” Indeed. But it’s disappointing that the EFF does not acknowledge the loss of trust in the system that occurs when search for quality information or legitimate resources yield top results that include piracy and SPAM.  At the very least, the user’s time is wasted; and at most, clicking on these links can expose him to malware leading to identity theft and other hazards. Perhaps more benignly, we know that in walled gardens like Facebook, our feeds are no longer chronological but rather represent what that company’s algorithm has determined we “want” to see.  And similar manipulation of results in Google search “tailored” to our apparent preferences continues to be studied as a means to influence political debate or effect the outcome of an election.  If the EFF wants to fuss about free speech, these seem like far more acute areas of focus than the hypothetical shutting down of a handful of criminal operations.

And so, I return to my lead question:  What in blazes does the EFF want?  They don’t like law-enforcement remedies for online piracy, and they apparently don’t want to see voluntary cooperation between OSPs and rights holders either.  At a certain point, it seems we have to conclude that what they want most of all is to maintain their relevance by constantly finding a problem for every solution.