Media Wonk

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Catching up - June 15, 2008

Media Wonk was off last week (the better to savor the murderous heat wave here on the East Coast) and is just now catching up with a big week of news: The 3G iPhone, Yahoo/Microsoft/Google, contaminated tomatoes, etc. Plenty has already been written or said on all that, so the Wonk won't inflict yet another rehashing of it all on you. Suffice it to say, I'm glad I don't own Yahoo stock and if it weren't for the conflict of interest I would happily own Apple's. But a few, less-publicized items also caught our eye and bear some brief observations:

• The MPAA and selective output control: How bad has the mutual suspicion between content owners and their customers gotten that even when the studios try to bring consumers something new, consumers think they're trying to take something away? Barely a week after the FCC took up an MPAA petition seeking a waiver of the limits on the use of selective output controls for VOD transmissions, the agency has received over 350 comments from the public. The overwhelming majority urge the FCC not to grant the MPAA's wish, on the supposed grounds that content owners "already have too much control," to quote one typical example. Never mind that consumers currently have no access to what the studios' are promising if they get the waiver--on-demand access to high-def movies months earlier than they appear on DVD--and may never if the FCC says no to the MPAA's request. If the studios want it, it can't be good for consumers, or so a lot of the thinking apparently goes. That can't be good for either party.

• Universal Music Group v. Augusto: A federal district court in California last week granted summary judgment in favor of defendant Troy Augusto in a case brought against him by Universal Music Group charging Augusto with copyright violation for selling "promotional" copies of CDs he bought at second-hand shops on eBay. The record company claimed that a label on the CDs purportedly identifying them as licensed "for promotional purposes only," meant they were still UMG property and that Augusto was violating the company's exclusive distribution right. In his dismissal order, the judge had little trouble seeing through that argument, ruling that simply calling a transfer of ownership a "license" didn't make a license if the transaction in every other way walked and quacked like a sale or gift. Thus, Augusto was protected by the first-sale doctrine, which permits the resale of lawfully obtained copies without the say-so of the copyright owner. But Media Wonk is still puzzled as to why UMG brought the case in the first place. Objecting to the sale of "promo copies?" Now? Really? That's been going on essentially unchallenged for decades. What point was UMG trying to prove at this point? Don't the record companies have bigger things to worry about than sales of promotional copies in a fading format? Like how to make money from something besides the fading format? What am I missing?

• Canadian copyright: After failing to implement the WIPO Copyright Treaty in 2005 and several aborted attempts since, the Canadian government last week introduced a bill to overhaul Canada's copyright law. Although the bill would, for the first time, authorize certain types of "format shifting," as well as legalize home recording of TV programs, it would also introduce a ban on circumventing technical protection measures similar to the U.S. DMCA. Shrewdly, the government introduced the bill just before Parliament takes off for the summer and while facing the prospect of new elections in the fall that would effectively kill any pending legislation, thereby guaranteeing the new copyright bill an almost certain death. That won't stop Canadians from arguing about the bill, however. Critics of the measure are already in full cry, arguing that consumers' new format-shifting rights would be effectively mooted by the prohibition on circumventing DRM. You can't shift what you can't copy. The Canadian government is under intense pressure from the U.S., however, which earlier this year added Canada to the U.S. Trade Representative's Priority Watch List of countries deemed to have inadequate or ineffective enforcement of intellectual property rights. The designation means Canada could be subject to U.S. trade sanctions if it doesn't address the problem, as the proposed new law is intended to do. Failure to pass the law--which seems likely--could trigger a nasty trade war between the U.S. and its largest trading partner.

Can't wait to see what this week brings.
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