Google’s plea against web censorship rings hollow

google_lobbying_dcGoogle’s True Colors as Lobbying Goliath Revealed

Sunday’s Washington Post featured a story,  “Google, once disdainful of lobbying, now a master of Washington influence” that examined the company’s rise to become a top dog among Washington influence peddlers.  For Google watchers revelations in the piece, authored by Tom Hamburger and Matea Gold, come as no surprise.  However, for those who continue to regard Google as the web’s guardian angel of “free speech,” the story should add a bit of tarnish to its halo, illuminating the company’s extensive back-door maneuverings — the new normal in DC’s world of political puppeteering.

The behind-the-scenes machinations demonstrate how Google — once a lobbying weakling — has come to master a new method of operating in modern-day Washington, where spending on traditional lobbying is rivaled by other, less visible forms of influence.

(Read the e-mails between Google and GMU officials)

That system includes financing sympathetic research at universities and think tanks, investing in nonprofit advocacy groups across the political spectrum and funding pro-business coalitions cast as public-interest projects.

The rise of Google as a top-tier Washington player fully captures the arc of change in the influence business.

It wasn’t too long ago that Google was leading the charge against Washington insiders, those who deigned to file legislation that would target online content theft, the notorious Stop Online Piracy Act (SOPA).  Of course its ginning up hysteria among web users with the rallying cry “don’t break the internet” is simply just another strategic slice of the same (lobbying) pie the company is currently feasting on in Washington.   While the contrivances employed differ, the ultimate goal of protecting the company’s interests (and bottom line) lies at the core both of both.

Of course it’s not particularly surprising to find that one of the nation’s most successful and influential company has invested heavily (more than 15 million in 2013) to influence policy by any means necessary.  What is important is to see that Google’s anti-SOPA efforts for what they were–skillful lobbying that engaged web users as foils in a much larger game of chess.  After the SOPA web blackout, a headline in Tech Crunch gleefully declared, “SOPA Scorecard: Internet 1, Lobbyists 0.”  In his story David Binetti gave this appraisal of the (so-called) grassroots efforts that led to SOPA’s defeat.

Think about that for just a second: A well-organized, well-funded, well-connected, well-experienced lobbying effort on Capitol Hill was outflanked by an ad-hoc group of rank amateurs, most of whom were operating independent of one another and on their spare time. Regardless where you stand on the issue — and effective copyright protection is an important issue — this is very good news for the future of civic engagement.

Looking back, such assessments seem almost quaint in their naivety.  Following the web blackout, in a post-mortem published on 3digital.com  David Rodnitzky got it right:

The SOPA blackout was about as organic as the masses of North Koreans crying in the streets upon hearing of Kim Jong Il’s death. Behind the scenes, the SOPA protest was a well-organized campaign, fueled by the lobbying arms of major Internet corporations.

Moving forward, let’s hope that more people take note.  Google is out to protect Google’s interests, not ours.

Megaupload was not like Dropbox

images-1RIAA Sues Kim Dotcom and Megaupload for copyright infringement

Today the Recording Industry Association of America (RIAA) followed the music studios and filed suit against online piracy king Kim Dotcom and his defunct Megaupload cyberlocker website.  The RIAA’s suit charges that Kim Dotcom and his Megaupload cronies, “willfully engaged in, actively encouraged, and handsomely profited from massive copyright infringement of music on the Megaupload service…”

According to a story in Ars Technica, Dotcom’s attorney, Ira Rothken claims that the pirate cyberlocker was simply a cloud-based storage site, sharing a legit business model with cloud-based storage sites like Dropbox.

We believe that the claims against Megaupload are really an assault by Hollywood on cloud storage in general as Megaupload used copyright neutral technology and whatever allegations they can make against Megaupload they can make against YouTube, Dropbox, and others. And we believe that at the end of the day that the court will find their claims to be without merit and that the court will find that Megaupload and the others will prevail.

Nice try, but what a lie.  The business model that Dropbox and other legit sites follow bears no resemblance to the piracy for profit machine run by Dotcom.  The RIAA’s complaint points out one major difference:

Megaupload made money in two ways: premium subscriptions and online advertising.  Megaupload charged “premium” users subscription fees ranging from a few dollars per day up to approximately $260 for a lifetime subscription.  In exchange for payment, premium users would receive faster access to infringing files, including Plaintiffs’ copyrighted works, on Defendants’ computer servers.  Premium users of the site were able to download and upload files with few, if any, limitations…With respect to online advertising, the infringement-driven traffic on Megaupload and its associated websites increased the volume of online advertising impressions and transactions, leading to higher revenues.  Online advertising on Megaupload and its associated websites, which was heavily dependent on the popularity of copyright infringing content to attract website visits, yielded more than $25 million for Defendants.

The other important difference is fundamental to pirate cyberlocker’s pyramid-style business scheme.  Megaupload and other sites modeled after it (Filesonic, Fileserve, etc.) were dependent on a pirate army to spread their offerings (download links and streams) to forums across the web.  After all, without traffic, there was no money to be made and the way to drive traffic to the site was to spread the word and entice web users to visit the site and download infringing content.  Dropbox and other legit UGC sites DO NOT OFFER INCENTIVES for users to upload (pirated) content.  I wrote it about it on popuppirates.com in a blog post “Cyberlockers: Explaining Piracy’s Profit Pyramid.”  Though my post is several years old, given Rothken’s claims, it’s worth revisiting:

First of all, make no mistake, the vast majority of today’s piracy is driven by the thing that has motivated mankind since time began—the desire to make money.  If you take the time to spend a few minutes online exploring websites engaged in piracy (most people who speak out on the issue don’t seem to bother) you’ll quickly recognize that money is at the center of everything.

Mediafire download link (for flm-Unhappy Birthday) featuring Google ads.

If the ads aren’t hitting you squarely in the face, or the offers of high-speed, high quality downloads don’t spark suspicion, then perhaps it’s time to clean your glasses.  How ‘bout I take you on a tour?

Let’s begin with the sites that serve as the lynchpin for today’s online pirates.  No, I’m not going to talk about Pirate Bay or other notorious P2P (peer to peer) sites.  No need for that.  Consumers are all about convenience, and it’s not particularly convenient to download torrents and reconfigure the numerous file parts in order to view a movie.  Today it’s all about the one-stop shopping experience, and for that there’s no better storefront than the cyberlockers where, with the click of a mouse, you can download (or watch) your favorite film.  You’ll likely find other items on your wish list (e-books, music, software, and more) available for easy download as well.

You’ve probably heard the term “cloud based storage” floating around a lot lately.  Well, thanks to companies like Apple, and the recent launch of their cloud based offering called “iCloud,” the notion of storing files online via a virtual hard drive is gaining ground.  Cyberlockers have been providing this “service” for nearly half a decade now, and while there is legitimate activity taking place via some cloud-based storage sites like Drop Box and Yousendit, there are many others whose business model is predicated on content theft.  The now disabled Megaupload.com is a good example of the latter variety. (Read the indictment for a step-by-step tour through the inner-workings of their criminal enterprise.)

How does an illicit Megaupload-like business model  work?  Well, if you want to understand how cyber lockers work it’s helpful to think of a company like Amway.   Amway’s business success popularized the multi-level marketing style pyramid business model (or scheme ) whereby the operators at the top of the pyramid recruit people to work for them.  They, in turn, recruit more workers who, in turn, sell products to the public.  Those at the top make money only if they can recruit, and keep, enough people below to do the actual work.  Those doing the bulk of the work earn money, but at a much lower rate than those at the top.  It’s the trickle up theory of profits.

At any rate, if you journey to the cyberlocker of your choice–Megaupload, Filesonic, Fileserve, Filefactory, Uploading, Uploadstation, Mediafire, Megashares, Sockpuppet, Putlocker, etc. you will see enticements offered encouraging visitors to join this type of  profit pyramid.

Cyber lockers offer CASH for uploads.

Why do they do this?  Well the cyberlocker business model depends on traffic.  In order to drive traffic to their site they need content that will attract visitors.  What better carrot than popular movies, books or music?  Never mind copyright, there’s the “safe harbor” provision of the DMCA that allows the cyberlocker operators to essentially look the other way (plead ignorance) when it comes to the content that affiliates upload.  In fact, if uploaders did abide by a site’s published Terms of Service, the cyberlockers would quickly be out of business.

In other words, cyberlockers depend on an army of affiliates to do the dirty work for them.  It’s a scenario that enables the cyberlockers to shield themselves from legal liability, while their servers are simultaneously receiving thousands of  (stolen) files every day–fresh content  sure to attract new (and returning) customers.

So, in order to set this eco-system into motion, the cyberlockers lure their minions.  Uploaders can earn rewards, which usually start at around $35 per 1,000 downloads.  Simply put, the more downloads you generate for your file, the more money you earn.

Cyberlockers are booming thanks to profits from piracy.

 

That fact sets in motion the next level of piracy—the viral spread of the download links.  The affiliate armies take their links and post them on download (Warez) forums far and wide.  The more these links are “shared” across the web, the more money made.

Click to for PDF with 36 posts of viral links.

To further ensure their earnings, these cyberlocker affiliate pirates—I’ll refer to them as CAPs from now on–usually upload their stolen files to multiple cyberlocker sites.  This is called ‘mirroring” and what it means is that if a link is disabled on one cyberlocker site you can easily find the identical file on another.  Each CAP generally has affiliate accounts with multiple cyberlockers so that their illicit income won’t suffer if some links are disabled.

Since they are paid per download to maximize profits, CAPs often break a film file into several parts.   An average size for an uploaded film is around 700 MB (HD films can easily be double that size) but if divided into smaller chunks, requiring multiple links, and thus multiple downloads,  the CAP can earn more download points.  There’s a trade-off to this approach, however, as it can dissuade downloaders who prefer the convenience factor of downloading a “single” file.

Film download broken into several links in order to maximize profits.

Some sites like Megavideo (the streaming partner site to Megaupload) offer visitors the ability to watch an entire film streaming online with no download wait time.  Watch the film, and if you like it,  you can add it to your “collection” and download a copy for later viewing.

So, now that it’s pretty easy to understand how so much illegal content gets uploaded to the cyberlocker sites, let’s look for a moment how site operators turn that traffic into actual income.

At the top of the list is online advertising. Click a cyberlocker download link and you will arrive at a page like this.

Cyber locker site streaming the film “Unhappy Birthday” with Netflix ads serviced by Google.

There’s a link or stream for a  film and there are ads.  Various companies serve these ads, but one can’t ignore the fact that Google and other U.S. based ad servers like AdBrite are ubiquitous on the cyberlockers.   For the record, the ads seen on the image above and below are served by Google, though now that they’ve changed their icon and obscured their connection to them, it’s more difficult to tell.  In any case, no matter who serves the ad,  the cyberlocker makes money and the ad service provider makes money.  The creator gets squat.

Another cyber locker stream with more ads (provided by Google).

In addition to ad income, cyberlockers derive profit by offering “subscriptions.”  In this instance users pay a fee, averaging around $9.00 per month, that enables high-speed downloads on the website.  This means instead of waiting a half hour to download a full film, the entire process takes only 3 minutes.  For those who are repeat customers, this may be money well spent.  In this instance the cyberlocker site is making money and the payment processors (Visa, MasterCard, PayPal and the like) are making money.  Again, the content creator earns ZERO.

Cyber lockers cash in on selling subscriptions for high speed downloads.

In order to boost its subscriptions cyber lockers again turn to affiliate rewards.  Remember those forums where the CAPs go to spread their viral seed?  Well, many, if not most of those forum operators also have relationships with the cyberlockers and are an integral part of the piracy profit pyramid.  For every individual they “refer” who becomes a cyberlocker affiliate, they earn a referral fee.   Thanks to unfettered access to free content and income,  the eco-system of online piracy continues to thrive and grow.

HD-BB an online forum where viral cyberlocker links are spread.

 

Click image for PDF of some forum threads.

HD-BB is just one example of such a forum.   The forum operators boast of the high-quality “rips” shared by its members.  If you drill down into forum posts you’ll quickly discover that moderators only allow users to post links to specific, “approved” cyberlockers that the forum has a relationship with.  There are also links that direct users to the various affiliate options ensuring that the forum earns its fair share.  The forum makes money, the cyberlocker makes money and the creator of the content makes ZERO.

This is what I know.

Now that this black market business model is entrenched as a way of doing business around the globe, what can be done to stop it?  Well, I’m afraid that nothing can stop it–piracy will never disappear entirely–but something can be done to mitigate its effects.  This can happen if we can encourage the majority of websites at the center of this illicit cyberlocker eco-system to become (more) legitimate.

Cutting off the money that feeds this pirate profit pyramid is one part of the equation, but there’s also another component that may be equally important.  It’s a solution that it’s already working right in our own back yard.

I look to YouTube’s solution to piracy as an imperfect, but reasonable fix.  Let’s meet the pirates halfway.  Why not ask them to set up Content Management Systems (CMS) like the one YouTube has? A system like this would allow content owners to determine the fate of their work.  A CMS system basically allows for the fingerprinting of content so that infringing content can be instantly identified upon upload to the cyber locker site.

Dashboard for Youtube’s “Content Management System.”

The content owner could then determine, as they do on YouTube, whether to remove the content, monetize the content, or block it in certain territories.  In this scenario the cyberlocker can still earn money off uploaded content, but only at the discretion of the content owner.  Users will also be less inclined to post infringing content in the first place.  It’s a solution  that allows the content owner to take back control from the pirates (thieves)  and earn income off files that previously were simply stolen.   In this equation, at least everyone gets a piece of the pie.

It’s at this point that the false “piracy is good for business” refrain parroted by piracy apologists begins to gain some traction and some truth.  If piracy’s black market business model can be remolded  into a practice that can financially compensate the content creator–and restore their control of the content–perhaps it could become better for business.

The problem is that cyberlockers are not going to adopt a CMS system just to be nice.  Youtube,  a U.S. company, was forced to act under threat of ongoing litigation and legislation.   The only way today’s crop of cyberlockers can be forced to institute similar content ID systems is if their current business model becomes unsustainable.  For that to happen, like Youtube,  they too will need to face the threat of litigation and/or the long arm of the law.

Dotcom’s attorney can blather on all he wants about poor Dotcom, but it’s nothing more than disingenuous nonsense.

 

 

Zoe Lofgren, Google’s rep in Congress says copyright reform a non-starter

According to an article published in by Kate Tummarello in The Hill today, Zoe Lofgren doesn’t think much of Congressional efforts to reform copyright law.

Rather than trying to rewrite copyright law, the content industry is working with the tech community to curb online piracy, Lofgren said.

“They’re trying to do collaborative deals with the tech world,” she said. “They’re not asking for a big review of the copyright law.”

Hmmm, last time I checked a  number of people representing a wide swath of the creative industries (indie and otherwise) have become very invested in copyright reform efforts believing that it’s long past time to update the law for the 21st century/digital age.  Of course, when digesting anything Ms. Lofgren has to say about copyright it’s important to remember that  according to opensecrets.org  Google is her #1 corporate campaign donor and the company’s general distaste for laws that protect creator’s rights is well established.

zoe-lofgren-google

 

Could Megaupload have been a success like YouTube?

Kim Dotcom, megalomaniac mastermind of Megaupload

Kim Dotcom, megalomaniac mastermind of Megaupload

Kim Dotcom sued by Hollywood studios

The legal woes for Megaupload’s founder Kim Dotcom continue with today’s news that six movie studios including Fox, Disney, Paramount, Columbia, Universal and Warner have filed a lawsuit in federal court charging Dotcom and his site with “massive” copyright infringement.  From the complaint filed in federal district court in Virginia:

1. Until January 2012, when defendants were indicted on federal charges, defendants operated the notorious website and service located at www.Megaupload.com (“Megaupload” or  “Megaupload website”) as a commercial online hub for publicly providing popular copyrighted content, including thousands of plaintiffs’ copyrighted works, over the Internet to millions of Megaupload users without authorization ox license. On a daily basis, defendants intentionally infringed plaintiffs’ copyrighted motion picture and television programs on a massive scale and for a substantial profit. Defendants carried out this intentional, large-scale theft of plaintiffs’ intellectual property primarily through the operation of the Megaupload website, as well as associated websites like the video streanning service located at www.Megavideo.com (“Megavideo”).

2. Defendants intentionally and actively encouraged theix users to upload to the Megaupload computer servers infringing copies of the most popular entertainment content, including plaintiffs’ copyrighted television shows and movies. For example, through Megaupload’s “Uploader Rewards” program, defendants openly paid Megaupload users money to upload popular unauthorized and unlicensed content, including plaintiffs’ copyrighted television shows and movies, onto Megaupload’s computer servers. Pursuant to the Uploader Rewards program, the more often an uploaded file was downloaded by other users, the more money the uploader made.

3. Once a Megaupload user uploaded a file, defendants provided that user with a ”link” to the infringing content and encouraged the user to disseminate the “link” as broadly as possible on the Internet so that as many people as possible would find the link and use it to download the infringing content from Megaupload’s servers.

4. Defendants profited handsomely from this copyright infringement in at least two ways: by selling users “premium” subscriptions, which enabled rapid, unrestricted downloading; and by selling online advertising space to advertisers.

The complaint goes to describe the site’s business model–one built on piracy whereby the more content uploaded, the more traffic for the site, and the more ad and subscription revenue earned–more than 25 million according to the complaint.  It also pokes holes in the claims of Dotcom, and his apologists, that the site was a legitimate enterprise that merely provided storage for its users:

Contrary to some of defendants’ public assertions, Megaupload was not designed to be a private data storage provider. Users without premium subscriptions were restricted not only in their downloading capabilities, but also in their ability to store files on the site. Any content they uploaded would be deleted if it was not also downloaded within a certain period of time —after 21 days in the case of unregistered, anonymous users and after 90 days in the case of registered users who were not premium subscribers. Only premium subscribers (estimated to be 1% of users) could use Megaupload for long-term file storage. Thus, by design, Megaupload functioned not as a private online storage locker, but rather as a hub for uploading and downloading infringing copies of popular movies and television shows, including plaintiffs’ copyrighted works.

With this latest legal salvo fired against Megaupload and its founder perhaps it’s worth taking a moment to examine why YouTube, another site dependent on user-generated content (UGC) managed to survive and thrive, despite early accusations (and a major lawsuit) that labeled it a piracy cornucopia.  Why did Megaupload end up on the dust bin of history while YouTube has become a web video (and music) juggernaut?

The early growth and popularity of both sites was dependent on the public’s general disregard for copyright law.  Sure, some of the traffic to YouTube was generated by cute cat videos gone viral, but much of the site’s popular content included clips and often entire copies of tv shows and movies–content uploaders certainly had no right to disseminate.   Like Megaupload, YouTube hid behind the shield of “safe harbor” and monetized the content with advertising but unlike Megaupload, the site did not offer cash or other incentives to uploaders, not directly anyway.*

In 2007 Viacom filed suit against YouTube and like today’s filing against Megaupload, the charge was “massive” and “brazen”  copyright infringement. After seven years of legal back and forth, the parties finally announced they had settled the case in March, one week before they were scheduled to again face off in court.  The companies issued a joint statement which characterized the resolution this way: “The settlement reflects the growing collaborative dialogue between our two companies on important opportunities, and we look forward to working more closely together.”

YouTube-Content-IDUltimately what separates YouTube/Google’s success versus Megaupload’s demise lies with the fact that the head honchos at Google determined that respecting copyright ultimately provided a better business model than ignoring it.  On the heels of Viacom’s infringement suit,  YouTube introduced its Content ID (digital fingerprinting) system in 2008 which gave rights holders a (relatively) efficient way to deal the massive copyright abuses that plagued the site.  Rather than send hundreds, if not thousands of DMCA takedowns, musicians and filmmakers could claim content they own and be proactive in blocking, removing, or monetizing it.  The key was that Content ID allowed the creators to determine if and how their content could be viewed on YouTube, not the other way around.

Megaupload paid lip service to honoring DMCA takedown requests, but in actuality was playing a shell game, removing infringing links but not removing the actual files.  If you read the 70 page federal indictment against notorious pirate cyberlocker website Megaupload, you will find this charge on page 10, section 22:

When a file is being uploaded to Megaupload.com, the Conspiracy’s automated system calculates a unique identifier for the file (called a “MD5 hash”) that is generated using a mathematical algorithm. If, after the MD5 hash calculation, the system determines that the uploading file already exists on a server controlled by the Mega Conspiracy, Megaupload.com does not reproduce a second copy of the file on that server. Instead, the system provides a newand unique URL link to the new user that is pointed to the original file already present on the server. If there is more than one URL link to a file, then any attempt by the copyright holder to terminate access to the file using the Abuse Tool or other DMCA takedown request will fail because the additional access links will continue to be available.

During my dealings with Megaupload I’d long suspected as much.  Time after time, I’d remove links using Megaupload’s content management tool only to see a duplicate file reappear (with a new  link) minutes later.  Of course, unlike federal authorities, I did not have access to the actual content residing on Megaupload’s servers, so I couldn’t really prove it.

In the fall of 2011 while I was researching a pirate blog that offered illegal downloads to LGBT films, I saw that the film “Kyss Mig” was being pirated.  Since it’s a film distributed by the same company (Wolfe Video) that distributes our film I notified them of the infringing link.  A DMCA notice was sent and, as expected, the link was disabled.  However, when I went back to the website the following day I noticed that the disabled link had been replaced by a new one.  That led me to again notify Wolfe and the exercise in futility was repeated.  A few days later I noticed that the link was alive yet again, but the blog owner had changed things up (to protect her download) and the link now took me to an intermediate site “undeadlink.com.”

Essentially the site offered a convenient way to regenerate links to supposedly “dead” files on Megaupload (and apparently Fileserve).  If Megaupload had actually removed the infringing file when it was originally reported, this wouldn’t have been an option.  However, because Megaupload apparently did exactly what is spelled out in the indictment, it was very possible (and efficient).  When I discovered what was going on last fall, and that it verified my suspicions, I decided to record the process.  This video documents what I found.


Dotcom likes to pontificate (to anyone who will listen) and claims he’s “…at the forefront of creating the cool stuff that will allow creative works to thrive in an Internet age. I have the solutions to your problems. I am not your enemy.”  Were that really true, why didn’t Mr. Dotcom use technology to transform Megaupload.com into legitimate UGC  site by implementing a Content ID system like Youtube’s?  Oh right, he would have had to share the profits. Despite disingenuous rhetoric to the contrary, unlike YouTube, Megaupload actually employed technology to ensure that copyright infringement continued rather than prevent it.

It’s an ethos that has allowed online piracy for profit (under the guise of innovation) to propagate across the globe.  Why invest in a product when it’s just as easy to steal (and monetize) it?  Of course Dotcom and Michael Robertson (founder of MP3tunes who was found liable and hit with a 41 million dollar verdict last month in a copyright infringement suit) have both discovered there are consequences to such theft, but this should be the norm, not the exception.  Dotcom’s unbridled hubris and greed got the better of him.  One can only imagine what he could have achieved had he crossed over from the dark side and followed YouTube’s lead.

Moving forward, preventing such businesses from taking root in the first place should be one goal in Congressional efforts to update the Digital Millennium Copyright Act for the 21st century.  For all its faults, YouTube’s Content ID system lights the way for a possible path forward in redefining “safe harbor.”  If a website’s business model to is predicated on “sharing” creative work, providing content creators with technological tools to safeguard their work should be a requirement for meeting the “safe harbor” provisions of the law. Such a requirement would not “break” the internet.  It actually would could go a long way in fixing what’s currently broken.

Meanwhile, while YouTube has thrived where Megaupload has failed, businesses like YouTube can and should better reward the creators on whose work they depend.  As online distribution options grow and improve, hopefully many will say goodbye to the opaque revenue “sharing” model imposed by YouTube (and others) and take their content to sites/businesses where formulas for compensation are more transparent, and more generous to those who actually create the content.

A download link to a pirated copy of our film on Megaupload.com

A download link to a pirated copy of our film on Megaupload.com

BTW, is there a way indie artists could jump on board the lawsuit filed by the studios?  Why not make it a class action affair?  There are plenty of indie musicians, filmmakers and authors around the world whose works (and livelihoods) were ripped off by Kim Dotcom’s enterprise. In their lawsuit the studios are asking for maximum statutory damages of $150,000 per infringement plus the profits the defendants generated.  Just imagine how many new works might be in the offing if those thousands of creators whose works were pirated on Megaupload were awarded damages along with the studios?

 

*To this day there are still some YouTube users ‘s that earn ad revenue by uploading dubious content.  Of course YouTube/Google earns income off these uploads too.

Everyone hates the DMCA

dmca-broken

1998′s DMCA is well past its sell-by date.  Time for a makeover.

The past 20 years have seen a virtual technology revolution.  We have the world at our fingertips, literally.  Yet, despite the massive technological transformation of our society and culture, our laws have yet to catch up.  The haggard Digital Millennium Copyright Act is a shining example of this fact.  Signed into law in 1998, the legislation was designed to manage copyright issues in the dawning digital age.

Unfortunately, rather than manage copyright, it’s provided a huge loophole through which a number of online pirate entrepreneurs sail blissfully through.  Known as the “safe harbor” provision, this oft-abused language has served to shelter digital thieves at the expense of rights holders.  ”Safe Harbor” has enabled the growth of a criminal cancer and it’s a cancer–that as of now–cannot be beaten, only kept (marginally) at bay. As Wikipedia notes, “The DMCA’s principal innovation in the field of copyright is the exemption from direct and indirect liability of internet service providers and other intermediaries.” As I’ve suggested previously, any update to the law should include a requirement that in order to qualify for the limitations to liability that safe-harbor offers,  certain user-generated content sites must implement reasonable technology to mitigate content theft.  More on that later.

The actual “takedown” process has also drawn fire (from both sides of the debate).  Copyright holders often find sending out DMCA notices to be an exercise in futility as it’s nearly impossible to keep up with the volume of pirated content found online (usually via for-profit piracy websites).  Those who operate legitimate user generated content sites like YouTube argue that false DMCA notices stifle “free speech.”  Never mind that the vast majority of notices sent are valid if Google’s stats are any indication.  They report that more than 97% of the notices they receive are valid (data listed from 2011).

At any rate, this past week in Washington the wheels of government moved ever-so-slightly as the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet held a hearing on the DMCA.  The witness list included Katherine Oyama, Sr. Copyright Policy Counsel for Google; Paul Sieminski General Counsel for WordPress parent Automattic;  Grammy winning composer and conductor Maria Schneider;  Paul Doda, Global Litigation Counsel for Elsevier;  Annemarie Bridy, professor University of Idaho College of Law; and Sean M. O’Connor, a law professor from the University of Washington.

Overall the testimony was predictable.  Those representing copyright holders spoke on the burden of sending repeated takedowns while those with a tech perspective argued that the DMCA actually hurt those receiving notices more than it helped artists in safeguarding their work.  Tech representatives also extolled the virtues of “safe harbor” and declared that it was the reason that the internet has flourished in the nearly 20 years since the law was enacted.  Of course they failed to mention that abuse of “safe harbor” is rampant and that the intent of the law’s languages has been twisted beyond repair and in desperate need of a 21st century  makeover.

Google’s Katherine Oyama appears be well-liked in Washington DC, but even the RIAA found fault with her testimony and published a “fact check” of her statement.  Oyama noted that Google has spent more than “60 million dollars on the development of content ID on YouTube,” but the RIAA fact check puts that figure into context:

Google created Content ID in 2008. Google’s revenues since then have surpassed $200 billion – so Google only spends less than 0.03% of its revenues on preventing copyright theft on YouTube?

Ms. Oyama’s assessment that the DMCA was working well for rights holder was also a dubious assertion.

The increasing volume of takedown notices demonstrates the continued relevance and effectiveness of the DMCA’s notice-and-takedown regime. Copyright owners are using the process ever more intensively, suggesting that they continue to find it valuable.

“Valuable” relative to what?  I suppose something is better than nothing but certainly the DMCA as an effective method to remove infringing content online is somewhat like using an umbrella to keep dry in a hurricane.   Though not her intent, Ms. Oyama’s testimony does offer a glimpse at what should be included in any update of safe harbor:

As copyright owners and enforcement vendors continue to deploy new technologies to identify uses of their works online, we expect the cost per notice to continue to drop, and takedown volumes to concomitantly increase.

The key here is new technologies.  As I alluded to above, my suggestion to “fix” safe harbor would be to mandate that websites offering affiliate rewards (the business model used by the now defunct Megaupload) be required to institute some form of content ID system in order to vet content uploaded by these affiliates.  Note that I said sites offering affiliate (cash) rewards.  The cyberlocker business model, which has become the central means of disseminating and monetizing stolen content online, would no longer be viable.  Sites like drop-box that allow users to store and share files but don’t incentivize piracy would remain untouched.

Paul Sieminski who testified on behalf of Automattic, the parent company of the popular online blogging platform WordPress made perhaps the most ironic statement of the afternoon.

Another deterrent is that the counter notice form itself` – many users need to consult a lawyer before completing and submitting the form, and most don’t have the time or resources to do that.

Mr. Sieminski should try replacing the term “counter notice” with the term “DMCA notice.”  Just imagine what it’s like for indie filmmakers, musicians, photographers, etc. who find their work appropriated (usually for profit) online.  As Ms. Schneider pointed out in her testimony, the system is actually weighted against the content creator:

The takedown procedure should be more balanced. I am certain that most of my fans who upload my music have no intention of harming me – and probably no
knowledge that they are doing so. But to upload my music on most sites, one simply has to click a box saying they acknowledge the rules. On the other end of the transaction, I, the harmed party, must jump through a series of hoops, preparing a notice for each site, certifying documents under penalty of perjury, and spending hours learning the sites’ unique rules for serving the notice. Owners should have a more streamlined and consistent process to take content down.

Need more proof?  Well, if you haven’t done so already, take a look at the video I posted at the top of this piece documenting the more than 56,000 download links and streams we sent out to remove pirated copies over several months in 2010 after our film’s release.  Our DMCA story is not atypical.  Every day musicians, filmmakers and other creators around the world are spending time they could be using more productively, sending out DMCA takedown requests.   What about the “time and resources” of the content creators whose work is stolen and monetized by thieves?  Takedowns will be a part of any fix, but we must figure out a better way to create a balanced approach that doesn’t necessitate the need for an sending a seemingly endless cycle of notices to cyberlockers and search engines.

The time has come to fix the broken DMCA and create a system where creators can flourish– and the wealth of content they create can be enjoyed, and sustained, by consumers throughout the world.