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May 15, 2003 IP JUSTICE TESTIMONY BEFORE U.S. COPYRIGHT OFFICE HEARINGS UNDER DIGITAL MILLENNIUM COPYRIGHT ACT
IP Justice welcomes this opportunity to testify to the U.S. Copyright Office about the adverse impacts on the ability of users to enjoy ‘fair access’ to DVDs. Region code restrictions significantly interfere with non-infringing access to and post-sale uses of DVDs. The magnitude of this harm warrants the recommendation by the U.S. Copyright Office of the exemptions proposed by IP Justice in its submitted comments. IP Justice wishes to make four initial procedural comments. We will then make four substantive comments. First, IP Justice would like to again remind the Copyright Office that its obligations in this rulemaking are to the users. Moreover, the Office’s duty is to ensure access to works by users – not the availability of works by copyright owners. Congress introduced the anti-circumvention measures to encourage copyright owners to make their works available digitally – or in the words of the last rulemaking, the measures are designed to be ‘use facilitating’. The responsibility of the Copyright Office in this rulemaking is not to repeat Congress’ logic but to protect users and ensure access – not availability – of protected works such as CDs. Second, the structure of this rulemaking, as interpreted by the Copyright Office, effectively precludes it from achieving its purpose. The Copyright Office insists that exemptions be defined according to ‘class of work’. Adequate protection of user rights requires that exemptions be drafted with reference to the type of user and circumstances of use. For example, if a person imports a DVD for personal use, they are not infringing a copyright owner’s right to control imports but if a person imports commercial quantities of DVDs, they are. Third, the Copyright Office has set an impossibly high evidentiary standard given the nature of the harm it is supposed to protect against. The Copyright Office requires evidence of substantial harm or likelihood of harm. However, the adverse effects experienced by users are likely, of their very nature, to be individual and personal – difficult to measure and quantify. For example, it is extremely difficult to measure all of the Americans who travel each year and purchase a DVD overseas, intending to play it when they get home. But this does not detract from the prevalence of such harm. It does mean that Copyright Office should accept as sufficient evidence news reports and principled analyses of likely harm, which takes account of the interaction of the anti-circumvention measures with the limitations and exceptions for users under traditional copyright principles. Fourth and finally, IP Justice urges the Copyright Office to be mindful, in conducting this second rulemaking of two important facts. Firstly, the first rulemaking was conducted when the prohibition on access circumvention had not yet taken effect. Three years later, the trend of ‘digital lock-up’ is more apparent. Thus, the extent of the impact on users must be greater because the anti-circumvention measures are broader than copyright. The second important factor is that the impact of any exemption will necessarily be limited. This is something that the Copyright Office failed to take account of in the first rulemaking. Acts of circumvention of access controls are, by their nature, inherently noncommercial and personal. Anyone who seeks to take advantage of an exempted act of access circumvention must be highly technical literate. A person cannot acquire a circumvention device or service from a third party nor make it available to someone else because to do so will infringe the anti-trafficking prohibitions of section 1201. This means that only a limited number of people are likely to be able to avail themselves of any of the exemptions. Thus the impact on the copyright owner of any exemption will be limited. IP Justice has four substantive comments with respect to DVD tethering and the need to circumvent the access controls. Firstly, it is extremely important that the Copyright Office acts now and grants an exemption – before the users are misled into thinking that they do not have the right to watch foreign-purchased movies on Region 1 DVD players and before users effectively lose the right to watch foreign-purchased movies. Section 602(a) of the Copyright Act specifically carves importation of movies for personal, noncommercial use out the copyright owner’s monopoly. Access control should not be allowed to eliminate this consumer right and prevent users from taking advantage of this intentional statutory carve-out. What a user doesn’t know to use, they will lose. Failure to grant an exemption now will set this process of mis-education in train, irreversibly and will render section 602(a) meaningless for DVDs. In its first rulemaking the Copyright Office incorrectly relied on the fact that by purchasing additional equipment, a consumer could watch an overseas coded DVD. This misses the point. Such an attitude entrenches a defacto extension of the copyright owner’s right. Only the most determined and informed consumers are likely to do so – and then only if they have the disposable income to buy the necessary equipment. It precludes opportunity for competition and innovation in technology design. This overturns section 602(a)’s right of personal importation since it effectively bars such activity. In essence, DVD copyright owners are again dictating the technology preferences of the consumer and usurping individuals’ rights with digital media. It also means individuals may not build their own devices, such as free software DVD players to watch their own movie collections. Thus, the DMCA creates a monopoly on DVD players for major Hollywood movie studios. Second, region coding impedes cultural exchange. At a time when technology could enable greater cultural exchange – through the ability of American consumers to purchase foreign films through foreign websites - region coding enforces cultural separation. If people are forbidden to bypass these controls, we cut ourselves off from the opportunity for world-wide cultural exchange. The technology has the potential to collapse distance between people. But the business model of DVD copyright owners seek to erect artificial walls in order to receive maximum profits. The Copyright Office should not assist in this process at the expense of users. The Framers’ originally intended copyright to facilitate cultural exchange, but after centuries of manipulation and extending both the scope and breadth of copyright, it is now used to justify perpetuating cultural separation. Third, there is no evidence the movie industry will suffer harm as a result of a region-coding exemption. Just because profits are not maximized, does not mean the industry is unable to incentivize creativity. In addition to the highly personal, noncommercial nature of acts of access circumvention noted above, is the fact that this exemption will expand the global market for DVDs. Rather than the market simply being domestic, it will be international. And each person who takes advantage of the region coding exemption will be a legitimate purchaser in that global market. Fourth and finally, region coding defeats the first sale doctrine as it applies to DVDs. Without a region coding exemption, there is no market for foreign-purchased DVDs in the US. Similarly, there can be no overseas market for American DVDs. At exactly the time when the Internet opens up the opportunity for people to sell their second hand DVDs throughout the global village, region coding segments and shrinks the village bazaar. This will further discourage people from purchasing DVDs overseas, once they experience these restrictions. It further entrenches the copyright owner’s ability to control private enjoyment of all DVDs. It is the user’s rights to access and freely dispose of DVDs, wherever purchased, which the Copyright Office has a duty to safeguard. Thank you.
IP Justice testimony before U.S. Copyright Office in DMCA Hearings:
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