Thursday June 4th 2009, by Piers Strickland
The full article can be downloaded as a PDF here >
This article was written before the release of the judgment in the Pirate Bay case and, as I predicted, the Pirate Bay were held liable by the Swedish Court. Nonetheless, the issues raised below remain current.
Executive Summary
The development of computers and the Internet has transformed the way in which data are shared. Computers are machines that are phenomenally efficient at copying data and the Internet has now emerged as an effective way of distributing such copied data between Internet users around the world.
Copyright was invented to reward, protect and encourage artistic endeavour. The rights owners in industries such as music and film developed a business model that relied on customers paying fixed rates for products purchased through regulated channels. The Internet has now multiplied the channels in which consumers can obtain data files and has enabled individual Internet users to obtain data, by way of file sharing, without having to pay the fixed costs set by the rights holders.
Rights holders view such unauthorised file sharing as a crime: “copyright theft” and one that is increasing:
“DVD and online piracy must be recognised as a crime of growing national significance.
David Lammy, the UK government’s minister for intellectual property has been quoted as describing piracy as:
“…illegal, it’s criminal, it’s nasty and it’s horrible, and it’s right that we crack down on it.
In what is turning out to be quite a polarized debate, the other side of the debate view rights holders, such as the recorded music industry, as using antiquated copyright laws to protect equally antiquated business models, whilst failing to promote attractive legal alternatives. In essence, it is the greed of big business, which is the problem that has led to widespread illegal file sharing:
“…[in] all areas of society we have been conditioned to expect more for less over time. Yet until just a few years ago, the music industry was increasingly charging more, for the same product. And they were able to do this because copyright law gives them the ability to set prices like a legal monopoly.
The rights owning industries respond that until “copyright theft” is reduced then new business models (i.e. legal providers of digital content over the internet) cannot flourish.
Governments, including the UK, appear to be siding with rights holders in making it easier for rights holders to enforce their copyrights. However, even though the legal landscape is set up significantly in favour of rights owners, the developers of file sharing protocols appear to be staying one step ahead of the law. Furthermore, it is clear that copyright enforcement action must be on an international not just national scale, if it is to be ultimately effective.
This paper assesses the effectiveness of the legal system in relation to unauthorised file sharing over the Internet and assesses whether further legislation in the copyright field in the UK, as proposed by Lord Carter in the interim Digital Britain Report, is likely to be effective in achieving its stated aim.
Much of the empirical evidence analysed in this paper concerns the music industry, as this industry sector has been to date heavily affected by file sharing issues. However, where a point is made specifically about the music industry, in most instances, such a point does and/or will have more general applicability to other industry sectors now and in the future.
Historical perspective: the increasing effectiveness of file sharing technology
Sharing / copying of data is not a new phenomenon. New technologies have often been viewed by some as representing a threat to established interests. For example, the use of VCRs to record television programmes was challenged by the film industry in the seminal US case of Sony Corporation of America v Universal City Studios, Inc. (the “Betamax case).
What has exacerbated the problem of file sharing for rights holders is the development of peer-to-peer (“P2P”) file sharing. P2P file sharing is different from traditional file downloading. Traditional file sharing is used herein to describe a situation where an Internet user would use a web browser to locate a file to copy via a server and then proceed to download that file directly from the server. Whereas, in a P2P sharing situation, a software program is used to locate other personal computers that have the requested file. As a result, the desktops, laptops etc. that are used in the file sharing process are described as “peers” of the original requesting computer.
Contrary to common misapprehension, P2P file sharing is not necessarily an illegal activity. For example, the BBC’s iPlayer is a recent example of a legitimate P2P system. The BBC iPlayer uses a P2PTV protocol also used by Joost.
P2P file sharing applications are in a continual state of evolution. One of the most famous early P2P platforms was Napster. Napster worked basically in the following way:
1. A user would start the Napster software on their machine (“Machine A”), which would in effect make Machine A small server able to make files available to other Napster users.
2. Machine A would then provide to Napster’s central servers a list of all relevant files that are available on Machine A. As a result, the Napster central servers would obtain a complete list of every shared song available on every hard disk connected to Napster at that time.
3. After typing in a query for a file on Machine A, Machine A is connected to the user’s machine that the Napster server has identified as having that song, and the song is downloaded directly from that machine.
Napster developed in this way because its own servers could not hold billions of songs and then make them available for download in an effective method. Therefore, it needed to develop a system for direct user contact to take the pressure off Napster’s servers.
Napster’s architecture ultimately made it vulnerable to legal attack, which culminated in the US with the case of A&M Records, Inc. v. Napster, Inc. This was a seminal intellectual property case in the United States, with worldwide repercussions. The United States Court of Appeals for the Ninth Circuit ruled that Napster could be held liable for “contributory infringement” of the plaintiff record company’s copyrights.
The Ninth Circuit found that:
“Napster users infringe at least two of the copyright holders’ exclusive rights: the rights of reproduction…and distribution.”
The Court dismissed Napster’s fair use arguments, distinguishing it from “the Betamax case”, on the basis that the manufacturers of VCRs had no control over how people used them after they were purchased, i.e. they could not control people copying videos. By contrast, the Court found that Napster could control the infringing behaviour of its users, and therefore had a duty to do so.
Whether the distinction drawn by the Court in this case is valid remains a moot point. What the decision perhaps more accurately exhibits, is a natural hostility among the judiciary for behaviour that is widely regarded as illicit. Therefore, with this in mind, judges in many jurisdictions may well be prepared to craft pre-existing case law on copyright to make P2P providers liable for copyright infringement.
However, if the record companies hoped that the Napster litigation would put an end to P2P file sharing, then they were in for a disappointing surprise. P2P file sharing applications simply adapted around the new legal landscape to make it harder for the copyright laws to stamp out unauthorised P2P file sharing. In particular, applications such as “BitTorrent” developed and propagated themselves in such a way, so that the record companies had to revise their strategy somewhat.
BitTorrent is now widely held to be the most popular file sharing protocol. BitTorrent is especially effective at sharing large data files and by some estimates accounts for around 18% of all Internet traffic.
The BitTorrent protocol works by a user making a data file the first “seed” and then allowing other peers to download this data file. Each peer who downloads the data also uploads it to other peers and is encouraged to continue making data files available after the download has completed, becoming additional seeds. The addition of more seeds makes the whole file sharing process between different users much more effective.
To share a file or group of files, a peer creates a small file called a “torrent” (e.g. MySong.torrent). This file contains metadata about the files to be shared and about the “tracker” (the computer that coordinates the file distribution). Peers that want to download the file must first obtain a torrent file for it, and connect to the specified tracker, which tells them from which other peers to download the pieces of the file.
In order to download a file, BitTorrent users browse the Internet to find a torrent of interest, download it, and open it with a BitTorrent client. The client connects to the tracker(s) specified in the torrent file, from which it receives a list of peers currently transferring pieces of the file(s) specified in the torrent. The client connects to those peers to obtain the various pieces. If the “swarm” contains only the initial seeder, the client connects directly to it and begins to request pieces.
Another distinguishing feature of BitTorrent protocols is that they work on a “tit for tat” basis, i.e. in order for BitTorrent users to receive files they must also be set up to give them. This was a specific development aimed to work against the problem of “leeching” whereby Internet users only connect so long as they are downloading files and as soon as they finish they disconnect, thus not putting any files back or offering their Internet bandwidth to the file sharing community.
BitTorrent protocols can present a harder legal challenge (than Napster style configurations) for plaintiff rights holders who wish to stop BitTorrent being used to commit acts of copyright infringement. This is because BitTorrent providers do not necessarily copy data on their own servers. Instead, the copying is only done by the individual users’ computers. As a result, cases against BitTorrent providers have had to be more narrowly drawn and have had to be framed around more indirect infringements, depending on the specific territorial laws, such as “inducement” and “making copies available”. This position has been reflected in the ongoing case in Sweden against The Pirate Bay.
The Pirate Bay is regarded in some quarters as the most popular offeror of BitTorrent protocols. It has infuriated the rights holding industries by its popularity and its mockingly offensive responses to the various infringement claims that have been made:
Letter before action from Dreamworks:
Dennis L. Wilson, Esq.
KEATS McFARLAND & WILSON, LLP
9720 Wilshire Blvd., Penthouse Suite
Beverly Hills, CA 90212
Tel: (310) 248-3830
Fax: (310) 860-0363
August 23, 2004
VIA ELECTRONIC MAIL
AND U.S. MAIL
ThePirateBay.org
Box 1206
Stockholm 11479
SWEDEN
Re: Unauthorized Use of DreamWorks SKG Properties
To Whom It May Concern:
This letter is being written to you on behalf of our client, DreamWorks SKG (hereinafter “DreamWorks”). DreamWorks is the exclusive owner of all copyright, trademark and other intellectual property rights in and to the “Shrek 2” motion picture. No one is authorized to copy, reproduce, distribute, or otherwise use the “Shrek 2” motion picture without the express written permission of DreamWorks.
[...]
As you may be aware, Internet Service Providers can be held liable if they do not respond to claims of infringement pursuant to the requirements of the Digital Millennium Copyright Act (DMCA). In
accordance with the DMCA, we request your assistance in the removal of infringements of the “Shrek” motion picture from this web site and any other sites for which you act as an Internet Service Provider.
We further declare under penalty of perjury that we are authorized to act on behalf of DreamWorks and that the information in this letter is accurate.
Please contact me immediately to discuss this matter further.
Pirate Bay response:
Date: Sat, 21 Aug 2004 18:21:43 -0100 (GMT)
From: anakata
To: KMWLAW@flash.net[/email]
Subject: Re: Unauthorized Use of DreamWorks SKG Properties
On Mon, 23 Aug 2004 KMWLAW@flash.net wrote:
As you may or may not be aware, Sweden is not a state in the United States of America. Sweden is a country in northern Europe.
Unless you figured it out by now, US law does not apply here. For your information, no Swedish law is being violated.
Please be assured that any further contact with us, regardless of medium, will result in
a) a suit being filed for harassment
b) a formal complaint lodged with the bar of your legal counsel, for sending frivolous legal threats.
It is the opinion of us and our lawyers that you are morons, and that you should please go sodomize yourself with retractable batons.
Please also note that your e-mail and letter will be published in full on http://www.thepiratebay.org.
Go fuck yourself.
Polite as usual,
anakata.
The current trial has been brought by the Swedish government against The Pirate Bay. This case contains criminal charges against various personal defendants with claims for substantial damages (117 million kronor / USD$13 million) having been filed by the rights owning companies.
At the time of writing, the trial involving the Pirate Bay in Sweden has just closed and judgment is expected on 17 April 2009.
The alleged damage caused by P2P file sharing of protected works
P2P file sharing poses a significant problem for many different industries that rely on generating money by the sale or licensing of copyright works that are capable of digital transmission. The industry that has been hit hardest thus far is probably the music industry. This is due to a variety of factors, such as: the relatively small size of the music file downloads in question, the increasing availability of broadband Internet access and the relative IT proficiency of young music fans who are probably behind a lot of the illegal file sharing.
According to a study commissioned by the BPI (carried out by Jupiter Research), over six and a half million consumers’ broadband accounts are used to access music without permission using P2P services. On the back of this research, the BPI appears to have claimed that the cumulative cost of P2P file sharing over the next five years will amount to £1billion.
A survey by Entertainment Media Research showed that 29% of respondents admitted to having downloaded unauthorised music with 21% admitting having downloaded movies and/or television programmes.
A report by LEK Consulting, commissioned by the Motion Picture Association, estimated that Internet piracy (not just P2P file sharing) cost the major US motion picture film studios around US$6.1 billion in 2005 with 62% of this loss resulting from the piracy of hard goods such as DVDs and 38% coming from Internet piracy. Therefore, according to LEK’s figures, the major US motion picture film studios lost around $2.3 billion to Internet piracy.
A report by the Institute for Policy Innovation concluded that global music piracy causes $12.5 billion of economic losses every year, 71,060 U.S. jobs lost, a loss of $2.7 billion in workers’ earnings, and a loss of $422 million in tax revenues, $291 million in personal income tax and $131 million in lost corporate income and production taxes.
In the area of music, the decline in revenues has been sharp with the net declines in revenues was as large as £152.4 million. CD sales fell 38 per cent between 2001 and 2007, a period which saw a very sharp rise in the levels of unauthorised file-sharing.
However, the relationship between the financial downturn in the music industry and the rise of illegal P2P is the subject of fierce debate. Some industry comments have pointed out that other factors may be behind the decline in music revenues. For example, Capgemini reported that:
“…of £480m lost to the [music] industry since 2004, £368m was the result of format changes: principally the unbundling of the CD into an “a la carte” selection of digital songs. Of the remainder, 18 per cent was lost to piracy.
In other words, the downturn in music revenues was more a result of the music companies failing to achieve a first mover advantage in the digital music business, leaving others, primarily Apple / iTunes free to move into this industry sector.
Other commentators have claimed that the big rights owning companies are largely victims of their own making due to:
“…a slow transition to a digital world, boring music, rapacious pricing, a media glut, an obsolete format (the album), poor marketing, restrictive licensing and business practices, and a shrinking percentage of consumer entertainment mindshare and dollars”
As well as failing to develop quickly enough legal P2P services, the music companies have also failed to remain competitive in comparison to what is being offered by unauthorised P2P offerings. In part, this may be due to a reluctance on the side of music companies to view such unauthorised P2P offering as true “competitors” on the basis that their operations are illegal and that their business are not based on a legal business model (i.e. they do not pay royalties to the copyright owners):
“Genuine products are always going to be more expensive than free, because when you buy a counterfeit product nobody responsible for creating the product in the first place gets paid; attempting to compete on price alone with illegal free music would be the fastest way for record labels to go out of business.”
While such arguments do have merit, they do miss the point that consumers of P2P services do find the unauthorised download sites to offer a better user experience than the legal sites. Statistics setting out the results of such survey evidence were complied by Entertainment Media Research:
• 70% agree that the legal download sites do not have the range of legal sites.
• 68% agree that they can get the files they want much quicker on illegal sites than on legal sites.
• 64% would pay for legal downloads if they had what they wanted.
Accordingly, if the last statistic is to be believed, then the music companies’ failure to provide or licence legal sites has created a situation where the illegal sites offer users a better user experience than the legal offerings. This is contrast to counterfeit hard copies of media products, such as film DVDs, which are generally thought to be of inferior quality than the legitimate versions.
Other commentators have questioned some of the figures put forward by rights holders and made the point that probably nobody knows the true extent of the damage that piracy is having on rights owning industries. This is because illegal downloads do not necessarily equate to lost sales. For example, an illegal download may be an inquisitive experience that is later following up by a legitimate purchase or it may be that the illegal downloader may not have bought a legitimate copy in any event.
Another factor preventing an accurate appreciation of the true effects of P2P file sharing is the fact much of this activity is clearly technically illegal and therefore many sharers will attempt to cover their tracks and also may not be inclined to admit to the true scale of their habits when surveyed.
While rights holders (and legitimate paying consumers) will find it most annoying that illegal downloaders are getting products for free, there perhaps needs to be a more sophisticated and less one-sided appreciation of the real, but complex, consequences of illegal downloading:
…if the industry is going to have a strategy on piracy, it first needs to have an internal discussion on piracy – and that discussion needs to move away from the past decade of tedious, repetitive panel debates at conferences, where everyone agrees that it’s a terrible problem, that Something Must Be Done, and cites anecdotal evidence that doesn’t actually mean a thing while the whole audience nods along.
It’s a sacred cow. Nobody dares question the impact of piracy, because it’s become one of the founding truths of the industry that it’s a terrible thing that’s damaging the whole market, a looming crisis whose severity can only be expressed by sucking in your lips, shaking your head sadly, and muttering nonsense about “thieves” and “stealing”.
Until that sacred cow is slain, and people within the industry start showing willing to ask real, serious questions about the impact of piracy, nothing of merit will ever be done. Until we appreciate the real scale of the problem (and get over the fact that it’s probably smaller than previous estimates suggest), all we’re going to see are more pointless panel discussions and more Quixotic assaults on consumers. The industry’s approach to piracy will remain, as it has been since the eighties, a tale told by an idiot, full of sound and fury; signifying nothing.
Copyright Law in the UK
The main body of law that is currently applicable to P2P file sharing is copyright and is set out in the Copyright, Designs and Patents Act 1988 (“CDPA 1988”). The rational underpinning copyright law is that it seeks to reward creators of protected works, by granting them certain protective rights. Without such protection, it is argued, creative industries would be not fairly rewarded for their creative endeavours, as it would be possible for others to take the benefit of the creative works without rewarding the creator. While the existence of some form of copyright protection appears to have broad support, it is the precise scope of such protection that is a contentious issue of debate.
Copyright subsists in numerous different types of work, such as: literary works, musical works, artistic works, dramatic works, sound recordings and films. All of the aforementioned works are capable of being shared / copied on a P2P basis.
In terms of how long the above mentioned copyrights subsist in the UK, the current position is as follows:
a) Literary works, musical works, artistic works, dramatic works: all 70 years from the end of the calendar year in which the author dies.
b) Sound recordings: 50 years from the end of the calendar year in which the recording was made.
c) Films: 70 years after the end of the year in which the death occurs of the last to survive of the principal director, the author(s) of the screenplay and dialogue, or the composer(s) of any music specially created for the film.
Accordingly, at present, the creators benefit from a lengthy protection afforded over their works. However, for some, the period of protection for some areas of copyright (notably that of sound recordings) is not long enough and looks likely to be extended.
The relevant “primary” acts restricted by copyright in a work are set out in section 16 of the CDPA 1988 and are as follows:
• To copy the work.
• To issue copies of the work to the public.
• To communicate the work to the public.
The restricted act of copying is known as the “Reproduction Right” and that of issuing copies to the public and communicating works to the public are referred to below collectively as the “Distribution Right”.
The Reproduction Right would be likely to be infringed by both the uploading and the downloading of material. Indeed, computers by their inherent operations are extremely proficient copiers of data and any unauthorised use of a protected copyright work on a computer is likely to results in numerous copies of data being made. As a result, the Reproduction Right is often easily infringed by the normal operations of a computer in relation to the unauthorised file sharing of copyright works.
Under English law, a “substantial part” of the original copyright work must be copied in order for there to be an infringement. A substantial part can be decided on either a quantitative or qualitative basis.
As described above, P2P file sharing protocols, such as BitTorrent, operate by users exchanging small parts of files in order to create a whole file. While this might, depending on the facts, be used to claim a defence on the basis that a substantial part has not been copied, it is suggested that in the vast majority of cases, an English judge would be reluctant to hold that copying even small parts of a copyright work by way of a P2P protocol transfer, would not amount to a substantial part. This can be categorised as potential “judicial prejudice” against P2P systems that are involved in wide scale infringements.
There is already old case law that taking a “little bit and often” may amount to copyright infringement and it seems very likely that an English judge, given the opportunity, would rule in a similar way in a P2P copyright infringement case. However, it is an interesting to speculate whether there is likely to be de minimus point where an English judge would state that such a minimal reproduction of data would not amount to infringement. Such a set of facts is perhaps unlikely to be tested in an English courtroom soon though, because, as described below, claimants are choosing only to sue individuals or companies that have infringed the Reproduction Right significantly and nowhere near this theoretical de minimus line of infringement.
At present it would be an infringement of the Reproduction Right to copy a CD of music purchased through legitimate channels onto your iPod. This is because the defences in CDPA 1988 are quite restricted. However, following Recommendation 8 of the Gowers Review, the Government is consulting on introducing a limited private copying exception for format shifting for works published after the date that the law comes into effect. Such amendments are overdue in order to bring copyright law into the modern age of multiple formats and also so that copyright law is not seen as totally out of step with today’s commercial realities.
The right to prevent infringement by communication to the public is a relatively new right, having been incorporated into the CDPA 1988 as s.20 on 31 October 2003, pursuant to the Copyright and Related Rights Regulations 2003, SI 2003/2498. This section provides that “communication to the public” shall include:
“…the making available to the public of the work by electronic transmission in such a way that members of the public may access if from a place and at a time individually chosen by them”
There are various problems with s.20 CPDA 1998 in the context of P2P file sharing. First, the word “public” is undefined, which may cause a problem for a global system such as the Internet, whereby any given data may be communicated to one user or to millions. Secondly, when does the “making available” actually take place? This, again, is an important issue for the Internet, where an individual user’s computer may be in a completely different territory to where he/she is sending the data. A lack of clarification of such terms may hinder claimants going after uploaders of data. Thirdly, the reference to “the work” implies a reference to copyright works as a whole. Whereas, with P2P protocols such as BitTorrent, copyright works are divided up into numerous packets of data. Accordingly, further clarification is needed in order to make s.20 CDPA 1988 useful in a P2P context.
It is also an act of primary infringement when a person: “…authorises another to do, any of the acts restricted by the copyright”. It is suggested that this section is unlikely to assist potential claimants in the P2P file sharing area, as most P2P file sharing protocol providers do not hold themselves as having the authority to authorise the copying of every possible file which can be copied using their protocol. Indeed, many rogue BitTorrent file sharing protocol providers will also probably claim that they will have no knowledge of for what purpose their customers are using their P2P protocols. In any event, in the case of Amstrad, where the defendant sold hi-fi systems, which included the ability to copy tapes at a high-speed, this was held not to be an infringement even though the inevitable result would be copyright infringements because the defendants did not provider the necessary authorisation. Accordingly, it seems unlikely that the English courts will be likely to hold P2P protocol providers such as BitTorrent liable for authorising infringements.
It is important to note that the Reproduction Right is a “strict liability” offence. In other words, it does not matter if the infringer is entirely unaware that his/her acts would constitute an infringement. If a primary infringement has taken place, then, subject to any defences the potential defendant may have, this would be a prima facie act of copyright infringement.
However, providers of BitTorrent protocols, such as The Pirate Bay, do not generally copy the data files themselves and deliberately so. As a result, it is difficult for rights holder to claim infringement of the Reproduction Right by entities such as The Pirate Bay. Instead, under English law, a rights holder may have to consider issuing an infringement claim for “secondary infringement”.
Secondary infringement deals with the situation when a person is possessing or dealing with an article, which the person in question has reason to believe is an infringing copy. Another potential case of secondary infringement could occur if a BitTorrent provider (or other relevant P2P protocol) was providing a means for making infringing copies. Section 24 of CDPA 1988 states that:
“(1) Copyright in a work is infringed by a person who, without the licence of the copyright owner—
(a) makes,
(b) imports into the United Kingdom,
(c) possesses in the course of a business, or
(d) sells or lets for hire, or offers or exposes for sale or hire,
an article specifically designed or adapted for making copies of that work, knowing or having reason to believe that it is to be used to make infringing copies.
(2) Copyright in a work is infringed by a person who without the licence of the copyright owner transmits the work by means of a telecommunications system (otherwise than by communication to the public), knowing or having reason to believe that infringing copies of the work will be made by means of the reception of the transmission in the United Kingdom or elsewhere.”
However, the reference to an article “specifically designed or adapted for making copies of that work” has been taken to mean by legal commentators, in the absence of judicial guidance, to mean that the “article” is not a photocopier (or in this context a P2P file sharing protocol) but rather a master sound recording or equivalent.
In the P2P situation, it is usually unnecessary to invoke the question of secondary infringements when dealing with individual Internet users, because, as mentioned above, such an individual is almost certainly to the have infringed the Reproduction Right if infringing material has made its way onto his/her computer.
Proponents of BitTorrent within the UK would no doubt claim that their operations do not amount to infringements under the CDPA 1988 in any respect. For example, in the ongoing Swedish trial, The Pirate Bay has used the “King Kong Defence” before the Swedish Court. This Defence is based on the (seemingly justifiable) assertion that Pirate Bay does not necessarily know the identities of the clients registered on their site, yet alone what they are doing with their BitTorrent protocol:
“the Pirate Bay doesn’t initiate transfers [and therefore is not liable]. It’s the users that do and they are physically identifiable people. They call themselves names like King Kong.”
…
If content owners want to go after infringers, they are free to do so, but that means going after individuals”
If the Pirate Bay’s lawyers’ statement above is correct and the Pirate Bay and other BitTorrent providers are not carrying out acts of primary infringement, i.e. themselves copying data files. As a result, potential claimants may be left with having to mount more indirect infringement attacks, such as arguing on grounds of secondary liability. For the reasons explained above, the UK is unlikely to be an attractive jurisdiction for litigation of secondary infringement claims in this respect.
The lack of cases in the UK can also probably partially be explained by the fact that most of the P2P service providers are located outside of the UK. Furthermore, the English legal system is not as attractive as some other jurisdictions, such as the US, because damages are awarded on a compensatory basis, not a punitive basis. In England and Wales, the courts will seek to put a successful claimant into the position it would have been “but for” the infringement, rather than punishing the defendant in a punitive fashion. Assessing damages in a large P2P case on a compensatory basis may not be appealing for rights holders, as it would give certain defendants an open forum to run arguments, as highlighted above, about the true scope of losses being suffered by the rights owning industries.
Copyright law in the UK is mostly directed towards civil, as opposed to criminal, offences. However, there are criminal provisions in the CDPA 1988. Criminal liability generally becomes an issue when a person makes or deals with infringing articles in the course of business or with a view to making a profit. Accordingly, the vast majority of P2P file sharing carried out by individuals in the UK would not be a criminal offence, as they are generally not carried out for monetary gain. However, the criminal provisions can be an issue for entities that are seen by the rights holders as carrying illegal P2P file sharing for profit. For example, the prosecution’s case in The Pirate Bay trial in Sweden has majored on the fact that The Pirate Bay has made substantial profits on the back of its illegal business operations.
The CDPA 1988 has also been amended relatively recently to include s.97A. This section enables applicants to obtain injunctions against Internet Service Providers (“ISPs”) where:
“…that service provider has actual knowledge of another person using their service to infringe copyright.”
In practice, injunctions against ISPs seem to be rare. In response to a claim from a rights holder that an ISP is hosting infringing content in relation to an ISP customer account, the ISPs will routinely state that they will provide such data on provisions of an appropriate Court order. Normally, the ISPs will not contest an application for such a Court Order.
It will be easier for a rights holder to simply apply to Court for a disclosure Order, rather than an injunction. Rights holders do not really want to have to injunct ISPs, as all they are interested in is historical information, which is adequately obtained by disclosure Orders. Furthermore, rights holders would prefer, in an ideal world, to work with ISPs against illegal file sharers rather than litigate against them. However, the provisions of S.97A CDPA 1988, as set out above, have given the rights holders a useful tool to use in any negotiations with ISPs. It can be put forward as a last resort and it is a provision that means that ISPs are unlikely to ignore a communication from a rights holders citing s.97 A CDPA 1988, in the context of infringements by way of file sharing.
The E-Commerce Directive
A further layer of law in the P2P area has been provided via Europe by the “E-Commerce Directive”. The E-Commerce Directive was devised in order to assist the “development of electronic commerce within the information society”.
In a P2P context, the E-Commerce Directive is very important as it provides certain immunities from liability. Without these immunities, the effective functioning of the Internet would be jeopardised. ISPs need special protection, because if they were liable for each infringement that takes place on or via its systems, then the ISPs would not be able carry on trading. The countless number of “technical” infringements that the ISPs would commit under a strict reading of the CDPA 1988 (without the protection of the E-Commerce Directive) would threaten to cripple ISPs if they were made liable for such infringements. Accordingly, the E-Commerce Directive introduced certain activities that would not amount to copyright infringements, namely acting as “mere conduits”, “caching” and “hosting”.
These defences only provide protection so long as the ISP complies with certain criteria, which include not getting involved in selecting the sender or recipient of the transmission and/or modifying the information or not holding the information for any longer than necessary.
Furthermore, the ISPs must act expeditiously to remove or to disable access to the information on which they have “actual knowledge”. Actual knowledge is defined, in respect of caching, to mean an order from a “court or an administrative authority”. Coupled with s.97A CDPA 1988, this has led to ISPs routinely asking for a Court order in response to a letter before action threatening copyright infringement proceedings and/or a s.97A injunction.
Recent legal proceedings concerning P2P file sharing
There have been various legal proceedings against P2P providers in territories outside of the UK.
In the US, the Betamax case held that copying technologies were not inherently illegal if substantial non-infringing uses could be made of them. Although this decision predated the Internet, the US Supreme Court has subsequently acknowledged, in the P2P file sharing case of MGM v Grokster, that the Betamax principle should apply in the Internet age, i.e. networks should not be liable for providing the technology absent evidence that there was evidence of inducing infringement.
Specifically, in MGM v Grokster, the US Supreme Court stated that:
“We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties. ”
……
The unlawful objective is unmistakable…in addition to intent to bring about infringement and distribution of a device suitable for infringing use, the inducement theory of course requires evidence of actual infringement…there is evidence of infringement on a gigantic scale”
In the UK, from 2004 onwards, the BPI has issued court proceedings in the UK against a certain number of individual file sharers. However, it is unclear whether the BPI has continued this campaign of litigation on a year on year basis since 2004 or whether they just issued a certain number of claims in order to create some press on the subject of the liability of file sharers under copyright law.
The BPI claims that:
“we have not yet taken legal action against anyone for the act of downloading…[and have only] taken legal action against major uploaders – people offering hundreds and sometimes thousands of files for others to download.”
The BPI has also on occasion taken action against websites offering downloads. .
Any infringement cases brought against by the BPI individuals alleging that such individuals have downloaded unauthorised files from the Internet are likely to be decided in favour of the claimants in an English court. As mentioned above, the Reproduction Right is very likely to have been infringed in the process of downloading and the only real evidential matter that will be to proved is that the individual defendant was the same individual who carried out the infringing act. In this sense, English copyright law is very much on the side of rights owners.
The UK government, as typified by the Gowers Report and Lord Carter’s Report, look set to enact further amendments to copyright law which are likely to further strengthen the powers of rights holders. However, suing individuals is an extremely costly way of dealing with the problem, given that copyright litigation in the UK is a time intensive and therefore expensive pursuit.
From personal experience of copyright litigation in the English High Court, even a routine action against an individual alleged infringer taken from the letter before action stage all the way through to a summary judgment hearing (which would be the cheapest way of getting a judgment) would be likely to cost a claimant from upwards of £50,000 from inception. (Any large law firm that quotes less is clearly offering their client a significant reduction given that Partner charge out rates at law firms specialising in intellectual property law routinely exceed £400 per hour and are often more than £600 per hour in London.)
Accordingly, given the scale of the infringing P2P file sharing problem, suing individuals one by one will not be a cost effective option. Litigation also has a negative public relations aspect, given that it results in copyright owners (or organisations acting on their behalf) suing their own potential customers. Litigation is not the best way to build customer loyalty for the future and can lead to unfortunate and indiscriminate results.
The indiscriminate results that such litigation can have has been highlighted, particularly by some of the actions issued by the Recording Industry Association of America (“RIAA”), which is the trade group that represents the U.S. recording industry. The RIAA has been particularly active, in comparison with the UK equivalent, the BPI, in issuing court action against alleged file sharers.
In one case, the RIAA issued a claim against a Macintosh using Massachusetts grandmother who was accused of using windows only Kazaa to download hard-core rap music. The RIAA response to criticism to such criticism over making such a claim was to point out that: “when you go fishing with a driftnet, sometimes you catch a dolphin”. This was a remarkably honest and frank assessment of the RIAA’s approach. The RIAA seems entirely comfortable with a certain amount of bad publicity being incurred in its fight against piracy.
Other copyright owners have got themselves into trouble in attempting to enforce their copyrights in England. Davenport Lyons, a City law firm, found themselves in very hot water for writing “overly aggressive” letters before action alleging infringements of its client’s video game. This matter has escalated so much that Which?, the consumer rights body, issued a complaint to the Solicitors Regulation Authority, complaining about such correspondence.
Whether the case involving Davenport Lyons resulted from an overly aggressive stance being taken, the case still outlines the extreme sensitivities and risks that copyright owners take when they start threatening members of the public with litigation.
The risk of misguided claims being sent out is increased by the fact that it is not always easy for potential claimants to identify an Internet user by reference to their Internet Protocol address (“IP address”) alone. This is because while some IP addresses are “static” i.e. they remain the same each time a user logs onto the Internet, other users will be “dynamically” assigned a different IP address each time.
As a result, potential claimants may have to issue proceedings to some extend blind as to who was the actual infringer. Furthermore, there is also the chance that, even with a static address, the person who copied the infringing material may not actually be the person in whose name the account is registered. Further legal complications may arise if the person who copied the file(s) in question is a minor or if the Internet account in question has been used by an unauthorised person, for example, somebody who may have accessed a wireless connection that was not adequately secured. It is worth noting, that there is no compulsion under English copyright law to secure an Internet connection, although it would be prudent to do so, as this may reduce the risk of copyright infringement occurring through a user’s Internet connection without their permission.
Given the difficulties highlighted above in pursuing individuals, potential claimants in the UK, such as the BPI, have been looking at other more effective targets to combat illegal file sharing. The BPI in particular has been heavily engaged in lobbying ISPs to play an active role in the campaign against illegal file sharing by pointing out, amongst things, that under the standard terms and conditions of many ISPs, the subscriber agrees not to use his / her Internet connection for “unlawful purposes”.
The ISPs have been resistant to this move, as it puts them into potential conflict with their clients. Also, by taking an active role in monitoring accounts, such action would threaten to deprive the ISPs of one of their defences under the E-Commerce Directive. However, from the perspective of the content owners, the ISPs are a much better target than individual Internet users. First, ISPs are commercial organisations and therefore there are not likely to be such sensitive public relations issues to deal with. Secondly, ISPs operate in a key part of the Internet set-up with regard to P2P file sharing, because it is the ISPs that may be able to identify an individual subscriber in relation to a specific IP address.
There is some evidence to justify the BPI’s approach. Research has also shown that Internet users may correct their behaviour if confronted by their ISP:
• 70% would stop downloading unauthorised material if they received a warning letter from an ISP.
• 66% would stop unauthorised downloading if they thought there was a greater chance of being caught.
Certain ISPs, such as Virgin Media, appear to have co-operated and have handed over details of IP addresses, which have resulted in letters going out to members of the public threatening further action if more evidence of illegal file sharing is uncovered.
However, it seems that content owners wish to push ISPs one stage further than just providing them with IP addresses of persistent infringers. Content owners want the ISPs to get involved in punishing Internet users and therefore taking a role in “policing” the Internet by playing on the issue that Internet users have agreed contractually not to use their Internet accounts for “unlawful purposes”. Furthermore, content owners are increasingly arguing that if Internet users ignore warning letters from their ISP about unlawful use of Internet account then they should have their accounts terminated.
The termination of Internet accounts in response to persistent illegal downloading has received formal approval in France, where the French government is in the process of introducing a “three strikes” rule whereby file sharers would get three warning letters before getting their internet accounts terminated. However, such a French law might put France into direct conflict with the EU, given that Brussels rejected in April 2008 a call to introduce such a three strikes rule into European law.
A three strikes programme was also agreed between the BPI and the ISP Tiscali. However, this arrangement broke down over a dispute about who would pay the costs of sending out warning letters to consumers. Tiscali were also reported as having concerns over their potential legal liability to consumers.
Proposed legal and regulatory changes in the UK
The UK government seems intent on passing legislation compelling ISPs to take a more active part in policing the Internet. The Gowers Report set out a number recommendations that were aimed at:
1) tackling IP crime and ensuring that rights are well enforced;
2) reducing the costs and complexity of the system; and
3) reforming copyright law to allow customers and institutions to use content in ways consistent with the digital age.
The Gowers Report noted that one aspect, which was of particular concern to rights holders, was the issue of P2P file sharing. As a result, the Gowers Report made the following recommendation:
“Recommendation 39: Observe the industry agreement protocols for sharing of data between ISPs and rights holders to remove and disbar users engaged in “piracy”. If this has not proved operationally successful by the end of 2007, Government should consider whether to legislate”
In the 2006 Pre-Budget Report, the Government agreed to implement all of the recommendations in the Gowers Report, including Recommendation 39 above.
Following on from the Gowers Report. The Department for Business, Enterprise and Regulatory Reform (“BERR”) consulted on the “Legislative Options to Address Illicit Peer-to-Peer File Sharing”.
BERR’s ideal option would have been a voluntary industry agreement, whereby, for example, ISPs and rights holder would work together effectively to combat illicit file sharing. However, given the opposing interests between ISPs and rights holders as shown in the responses to the BERR consultation, BERR has recently announced its intention to legislate:
“ACTION 13 – LEGISLATION / REGULATORY REFORM
Our response to the consultation on peer-to-peer file sharing sets out our intention to legislate, requiring ISPs to notify alleged infringers of rights (subject to reasonable levels of proof from rights-holders) that their conduct is unlawful. We also intend to require ISPs to collect anonymised information on serious repeat infringers (derived from their notification activities), to be made available to rights-holders together with personal details on receipt of a court order. We intend to consult on this approach shortly, setting out our proposals in detail.
The requirement of ISP to monitor some Internet users will potentially deprive the ISPs of certain defences under the E-Commerce Directive. However, even assuming that the new law will maintain the ISPs immunity to prosecution (on the basis that they cooperate with rights holders in passing on information as to IP addresses on receipt of a Court order) then the proposed new law does not seem to be much of a step forward form the current position. As mentioned above, ISPs generally make available details of the IP addressed of Internet users on production of a court order. Therefore, the proposed changes only seem to formalise the current informal position and perhaps add a compulsion on ISPs to send out warning letters.
What BERR’s proposal does not include is any reference to a three strikes rule or similar. Resistance to introducing a three strikes rule is probably because the UK government is concerned that such a move might be politically unpopular. In the current age of the information society, the Internet is becoming regarded as an essential human right. For example, Lord Carter’s Digital Britain Report said as much, where he made it clear throughout his Report that giving all citizens access to a fast Internet connection was of vital importance and that lack of such an Internet connection would significantly disadvantage those not adequately connected in the future.
Of course, there are other potential human rights issues to take into consideration when disconnecting individuals from the Internet. Take, for example, the situation where an Internet connection is shared by several people and that the action of one of those people leads to a disconnection. In such a case, innocent people will be subject to the injustice of being deprived of a home Internet connection. By placing Internet connectivity as being such an important issue / human right, then carrying out the threat of discontinuing an individuals Internet account would be seen as a harsh and extremely unpopular sanction.
The ISPs would also need to be protected in law from a claim from disconnected individuals, otherwise the ISPs would be at risk from being sued by disgruntled former consumers. Such lawsuits could potentially be a serious issue where an Internet connection is being used for business as well as personal reasons and the disconnection causes economic damages, which the consumers would then seek to recover from the ISP.
Perhaps a solution to the problem would be for any new law to build in certain protections from being sued for the ISPs. However, in such a situation, who would then be liable for unreasonably disconnecting an Internet connection? Would the rights holders be made liable in such situations? Under normal legal principles there would be difficulties in making such rights holders liable. For example, there would be no contractual relationship between the rights holders and the ISP’s customers. Even if a new law stated that ISPs would not be liable if they had acted “reasonably” this would require that the ISP became more actively involved in the decision making in disconnecting any given individual, because if ISPs are to be at risk from not acting reasonably, then they will need to devote more resources to judging whether its customers are in breach of contract by engaging in a sufficient amount of file sharing. For all of these reasons and probably more, the UK government has not gone as far as to endorse a three strikes system.
There are other practical problems about requiring ISPs to take a more active role in monitoring the activities of their customers. Most of this paper has been focused on P2P file sharing in the context of music files. This is inevitable given that the music industry appears to have been at the forefront of suffering and trying to deal with this issue. However, illegal P2P file sharing is not just a music industry problem. As Internet speeds increase, then other rights holders’ content become at risk. Illegal file sharing of films looks likely to increase dramatically once download and upload speeds increase. Other industries that will be affected include software houses. Indeed, there will a wide variety of industries that stand to be more and more affected by illegal P2P file sharing in the future.
Given the plethora of infringing files that take up a large proportion of the Internet, then it will be very difficult for ISP to be able to know what they are looking for when monitoring user accounts. It seems fair that the responsibility will be on rights holders to provide accurate information to ISP of suspect files.
However, rights holders are not the ultimate arbiter of whether a copyright exists and who owns that copyright. While in many cases it will be clear that copyright exists in a certain work (such as a recent piece of music) and whether a specified file is an infringement. In other situations, there may be some doubt as to who owns a given copyright and whether a specified file is an infringement or not. This may be particularly the case when the creator of the content is long dead but the copyright is still very much in force.
In any event, matters of copyright subsistence and infringement can often be grey areas that a court needs to resolve. For a right holder to assert a copyright that is not valid and/or not infringed which then leads to a disconnection on the basis of assertion, not a certain fact, may expose the ISP to liability and/or unfairly prejudice a consumer.
In any event, the system being advanced by the government, as detailed above, relies on an ISP and rights holders being able to link to a specific Internet user. However, quite apart form the problem of identifying an individual users in a dynamic IP address environment, there is also a growing movement of Internet users who are acting to anonymise their Internet activity in various ways.
For example, there are now software applications that claim to be able to protect an Internet user’s identity online by: “bouncing your communications round distributed networks of relays….around the world”. In addition there are likely to be other software products that offer improved encryption techniques, such as Usenet, which will also make it harder for rights holders to identify persistent infringers. There are also more and more ways of making current P2P protocols, such as BitTorrent, anonymous.
If there is a trend towards a large number of Internet users being able to anonymise their Internet activity, then the government and rights holders’ current strategy, to combat unauthorised file sharing by obtaining IP addresses to target the relevant offenders, will be in serious jeopardy.
As so often happens with the law being applied to the Internet; before the legislation has even been drafted, the technology is already moving onto the next stage.
The future of the Internet
Stepping back from the detail of the debate about how to combat illegal P2P file sharing on a copyright level, a more high level debate will be fought will be about the parameters surrounding use of the Internet. In turn, this will have a fundamental impact on the P2P file sharing issue.
As the power of computing and the Internet increases for even normal users, along with the scale of potential infringement or other “data offences”, there will be the question as to whether the Internet should be a neutral, free and largely anonymous environment or whether the Internet needs to be further regulated, for example, making it possible to track how Internet users are using this very powerful tool.
As a result, privacy issues are set to be of more and more importance and prominence in a legal and regulatory context. ISPs are now in a position potentially to record extensive and intimate details of an Internet user’s life, as conducted through the Internet. Such data is extremely valuable as a commercial product, as it informs companies about the preferences of particular customers. Increasingly, data is also starting to be collected which can identify the precise changing physical location of individuals using mobile devices. When such data falls into the wrong hands, this can be a serious issue, for example, as has just been reported with regard to Spotify, a legal music streaming and downloading service.
As already mentioned, such data is of keen interest to rights holding companies in some instances, as it may include evidence of which individuals are engaged in illegal file sharing. Currently, there is a wide divergence of opinion on data privacy issues. Some people are comfortable in handing over certain personal data to companies in return for free services, e.g. Facebook and free web-based email such as Hotmail / Gmail.
Other people are much more conservative in sharing their personal data. However, even the more cautious people will be frustrated at being required to divulge sensitive personal data when purchasing certain goods and services in the normal course of trade.
At present, a large amount of data is being collected on individuals by companies who are not complying with the relevant laws, such as the UK’s Data Protection Act 1998 (“DPA”). This is hardly surprising given that the penalties under the DPA are quite tame.
In any event, there is likely to be a significant divergence of opinion on data privacy issues between these two camps: the pro-data privacy arguing for a free and neutral Internet and the anti-data privacy camps perhaps arguing for more controls and regulation. There will be significant vested interest on both sides. The two results appear mutually exclusive, so there is much to play for on each side.
Conclusion
The claimants in the case against The Pirate Bay claim that they are not seeking to prohibit P2P file sharing per se:
“This is not a political trial, it’s not about shutting down a people’s library and it’s not a trial that wants to prohibit file-sharing as a technique
…
It’s a trial regarding four individuals that have conducted a big commercial business making money out of others file-sharing … copyright protected works.”
Despite what the rights owning companies’ position above, it seems unlikely that most rights owners will approve of unauthorised P2P file sharing when the motive is even non-commercial.
Even if The Pirate Bay loses the case made against it, this will not necessarily stop The Pirate Bay. Since the original police raid against The Pirate Bay in 2006, The Pirate Bay have built technological bulwarks against another takedown, law-hardening its network architecture with a system of redundant servers that spans three nations. According to reports, shutting down the Pirate Bay in any single country will now only cripple The Pirate Bay for as long as it takes for its fail-over scripts to execute, a gap measurable in minutes
For any effective shut-down of the Pirate Bay (or any other similar P2P providers) to be achieved there would need to be a multi-national operation. This is particularly so when it is estimated that as many as one-third of The Pirate Bay’s 22 million users live in China. Changes to the law in one country, such as the UK, will not be sufficient to prevent multi-jurisdiction P2P protocols.
For so long as the second largest economy in the world is not respecting intellectual property rights, then this infringing behaviour will feed into demand on the Internet. Where there is a demand from millions of users, Chinese or otherwise, there will always be those who will be keen to service that need. The fight against illegal downloaders is hard enough for the rights owning industries, without having to deal with non-compliance with treaty obligations at such a vital national level.
The Office of the US Trade Representative releases on an annual basis a “Special 301 Report” that lists those countries that it believes “deny adequate and effective protection for intellectual property rights”. In the 2008 Special 301 Report, there were nine countries on the Priority Watch List: China, Russia, Argentina, Chile, India, Israel, Pakistan, Thailand, and Venezuela. These countries will be “the subject of particularly intense engagement through bilateral discussion during the coming year”.
There are then a further thirty-six trading partners of the US that are on the lower level Watch List, meriting bilateral attention to address intellectual property rights problems: Algeria, Belarus, Bolivia, Brazil, Canada, Colombia, Costa Rica, Czech Republic, Dominican Republic, Ecuador, Egypt, Greece, Guatemala, Hungary, Indonesia, Italy, Jamaica, Kuwait, Lebanon, Malaysia, Mexico, Norway, Peru, Philippines, Poland, Republic of Korea, Romania, Saudi Arabia, Spain, Taiwan, Tajikistan, Turkey, Turkmenistan, Ukraine, Uzbekistan, and Vietnam. This indicates that there are a large number of countries that appear to be failing, to various degrees, to provide the robust intellectual property laws that are needed to combat illicit P2P file sharing effectively.
Indeed, since the 2008 Special 301 Report was released, the United States has used the WTO’s dispute settlement process to address a number of specific deficiencies in China’s IPR regime. The WTO ruled that China’s copyright law and customs measures were inconsistent with Article 5(1) of the Berne Convention (1971), as incorporated by Article 9.1 of the TRIPS agreement and the WTO panel “recommended” that China bring its customs ad copyright law into conformity with its TRIPS obligations.
As can be see from the information above, counties such as the US are lobbying and/or taking further action in order to bring about improvements to the intellectual property regime in a large number of countries. The success of such lobbying will impact significantly upon international piracy campaigns, such as unauthorised P2P file sharing.
Until there are consistently strong copyright laws on a wide international basis, then rights owners will continue to find the struggle against unauthorised file sharing over the Internet a very hard, if not impossible, fight. The Internet is a global system and yet it is governed by a myriad of different and unequal laws. This operates to the benefits of defendants who can take advantage of this inequality. Clearly, in The Pirate Bay trial, the claimants hope that jail terms will lead to the death of The Pirate Bay site, where perhaps civil enforcement has failed.
The Pirate Bay trial seems destined to go against the defendants in the first instance. As already observed, the judiciary in the developed world naturally tend to side with the rights owners. However, after the first instance decision there is likely to be several years of appeals , after which time BitTorrent may well have been surpassed by a different file sharing protocol.
The only way for rights holding companies to eradicate unauthorised P2P file sharing platforms would be if there was an integrated worldwide legal system that clearly ruled that specific P2P platforms were illegal. We are clearly nowhere near creating a global legal system to match the global reach of the Internet. As a result, in the meantime, the current situation seems set to continue: rights holding companies will attack popular P2P platforms that enable large scale unauthorised file sharing, while the development of legal P2P platforms remains frustratingly slow.
The legal platforms seem to be held back by the fact in order to be able to compete with unauthorised file sharing service platforms, legal services will need the same breadth of service. However, given that the rights are split between many different owners, then nascent digital content providers are at a significant disadvantage. Digital consumers want to be able to download the file of choice quickly and easily.
Until the rights owning companies co-operate in a way that leads to legal digital providers of content that matches the illegal sites in terms of user experience, then copyright infringement proceedings will not eliminate such illegal competition. However, certain “free” legal offerings in the music industry do, at last, seem to offer some competition for the free illegal options. For example, see www.deezer.com, a free Internet radio station, with music on-demand services.
Many more high-quality Internet digital content service providers are needed across a range of industry sectors. Consumers generally want to engage in legal Internet activity and would do so if presented with significantly attractive legal options. What the rights holding companies cannot do is to try and protect out dated business models by charging inflated prices for digital content that is bundled up with strict digital rights management protection. To do so, would be to ensure the continued success of the unauthorised P2P file sharing services.
However, perhaps whatever the rights owning companies do, the age of the enormous multinational media organisations and their associated business plans is at an end. Maybe the Internet will give access to smaller content providers with more modest business plans. Perhaps the democratisation of digital content has unleashed a power that large rights holding companies simple cannot contain.
What should not be sacrificed in the fight against illegal file sharing are the qualities that have made the Internet the phenomenon it is today, namely: speed of transfer of data and the means to improve upon these systems in the future. Other options considered by BERR in its consultation on illicit P2P file sharing included requiring ISPs to install filtering technologies that would be intended to block infringing content. Other legal commentators have also floated the idea of:
• Requiring P2P protocol providers to operate through a central server, Napster-style.
• Imposing surcharges on ISPs.
• Imposing download quotas, so that only heavy Internet users should pay surcharges.
It is understandable, given the significant challenges faced by rights holders in relation to illicit P2P file sharing, that the rights holding companies should seek to try and level up the playing field. However, technical measures such as filtering techniques are not an effective long-term solution to the problem of unauthorised file sharing. While such filters may curtail a certain level of infringement, it is extremely doubtful that they would eliminate it all and P2P networks are likely to find a way around such filters. More importantly, file filtering technology and other technical solutions threaten the efficacy of the Internet, as they would: “slow down everyone’s traffic to actually work”. Furthermore, such filtering activity may have unjust effects once in operation: “…files identified as infringing may in fact be legitimate or justified by the exceptions and limitations of copyright”.
It seems a dubious rationale to put such technical obstacles in the way of an optimally operating Internet, as a response to the perceived needs of a special interest group. As with all laws, the legal and regulatory system dealing with the problem of illicit file sharing on the Internet must be assessed in the wider public context. In this situation, the harm that illicit file sharing does to rights owners must be considered against the benefit that a free and unregulated Internet has for its users and the wider public.
At present, the further legislative changes put forward by BERR and Lord Carter in relation to file sharing seem justifiable. However, they do not actually significantly improve the position of rights holders. As a result, while rights holders will continue to ask for further legal and regulatory ammunition, it seems to be in the overall public interest that these pleas are left largely unanswered, so as to safeguard the fundamentals of Internet and thus serve the greater public interest.
FOOTNOTES
[1] Sharp, Kieron, Director General, Federation Against Copyright Theft, “FACT: Who we are”
http://www.fact-uk.org.uk/site/about/index.htm.
[1] From the Federation Against Copyright Theft’s website: http://www.fact-uk.org.uk/site/quotes/index.htm.
[1] Posted by Lee (2009) “Why People Don’t Believe In Paying For Music. Hint: Its All About Deflation”. http://www.squawkingtech.com/2009/01/why-people-dont-believe-in-paying-for-music-hint-its-all-about-deflation/.
[1] As reported from the Pirate Bay trial in Sweden, on 25 February 2009: http://www.ifpi.org/content/section_news/20090225a.html,
[1] http://www.culture.gov.uk/what_we_do/broadcasting/5631.aspx
[1] 464 U.S. 417 (1984)
[1] “BBC aims to become big in online television” Dan Sabbagh, The Times, 9 September 2005: http://business.timesonline.co.uk/tol/business/industry_sectors/media/article564352.ece
[1] 239 F.3d 1004 (9th Cir. 2001).
[1] Sony Corp. of America v. Universal City Studios, Inc. 464 U.S. 417 (1984).
[1] Written by “Ernesto” on 18 February 2009 http://torrentfreak.com/bittorrent-still-king-of-p2p-traffic-090218/.
[1] Ellis, Leslie July 2006 Multichannel News, http://www.multichannel.com/article/CA6332098.html.
[1] The explanation of how BitTorrent works is taken largely from Wikipedia: http://en.wikipedia.org/wiki/BitTorrent_(protocol).
[1] At the time of writing the trial against the Pirate Bay was still in progress: http://en.wikipedia.org/wiki/The_Pirate_Bay_Trial.
[1] Ernesto on (28 December 2008) http://torrentfreak.com/top-10-torrent-sites-of-2008-081228/.
[1] The Pirate Bay Website: http://thepiratebay.org/legal.
[1] Oswald, Ed (31 January 2008) http://www.betanews.com/article/Sweden-formally-charges-Pirate-Bay-owners/1201799919.
[1] Landes, David (2009) http://www.thelocal.se/17670/20090218/.
[1] Swartz, Oscar (3 March 2009)
http://blog.wired.com/27bstroke6/2009/03/pirate-bay-tria.html.
[1] BPI Website: http://www.bpi.co.uk/index.asp?Page=news/press/news_content_file_1141.shtml
[1] Page 12 on BERR’s Consultation on legislative options to address illicit P2P file sharing, http://www.berr.gov.uk/consultations/page47141.html.
[1] Digital Entertainment Survey 2008, http://www.entertainmentmediaresearch.com/news/news.asp.
[1] MPAA website: www.mpaa.org/leksummaryMPA%20revised.pdf.
[1] IPI website: www.ipi.org.
[1] IFPI Website, 18 June 2008, www.ifpi.org.
[1] http://www.ifpi.org/content/section_news/20090225a.html.
[1] Orlowski, Andrew (19 October 2007) http://www.theregister.co.uk/2007/10/19/vrs_value_gap_report/.
[1] For example, see blog entry by Marc (14 June 2006): “The Sky is Falling: Is the Record Industry Ready to Face the Music?” http://www.p2pweblog.com/50226711/the_sky_is_falling_is_the_record_industry_ready_to_face_the_music.php.
[1] Anti-piracy section on BPI website: http://www.bpi.co.uk.
[1] Digital Entertainment Survey 2008, http://www.entertainmentmediaresearch.com/news/news.asp.
[1] The author (who just happens to be a yorkshireman) regards this statistic with some suspicion and considers that most consumers would only be prepared to pay a very low price for a product which is available free elsewhere.
[1]Blog article posted by Marc (17 April 2006) “Jupiter researcher catches a fast one from BPI” www.p2p-weblog.com/50226711/jupiter_researcher_catches_a_fast_one_from_bpi.php.
[1] Fahey, Rob (29 August 2008) “Pirate Station” http://www.gamesindustry.biz/articles/pirate-station.
[1] The Legal Affairs Committee of the European Parliament has approved legislation extending the copyright protection for music compositions (i.e. sound recordings) on physical devices (i.e. digital forms are excluded) to 95 years: http://www.europarl.europa.eu/news/expert/infopress_page/058-48812-040-02-07-909-20090209IPR48791-09-02-2009-2009-false/default_en.htm.
[1] See s.16(3) CDPA 1988 and Designers Guild Ltd v Russel Williams (Textiles) Ltd [2000] 1 WLR 2416.
[1] See the discussion in Copinger and Skone James on Copyright (15th Edition) 2005 by Kevin Garnett and Others, 7-29 and the case of Trade Auxiliary Co v Middlesborough, etc. Association (1889) 40 Ch.D. 425.
[1] In which, it is assumed, copyright subsists.
[1] Commissioned by the UK government to review the UK’s framework of intellectual property laws, the Gowers report was published on 6 December 2006 and suggested proposals on a wide range of policy issues, including copyright: http://www.ipo.gov.uk/pro-policy/policy-information/policy-issues/policy-issues-gowers.htm.
[1] Format shifting includes, for example, copying a legitimately bought music CD into an MP3 format.
[1]http://www.ipo.gov.uk/pro-types/pro-copy/c-policy/c-policy-copyexceptions.htm.
[1] This issue is raised by Colin Nasir, Solutions to Copyright Infringement Over the Internet: Part 1 [2005] ENT.L.R.
[1] s. 16(2) CDPA 1988.
[1] CBS Songs Ltd v Amstrad plc [1988] A.C. 1013.
[1] s.23 CDPA 1988.
[1] See the discussion in Copinger and Skone James on Copyright (15th Edition) 2005 by Kevin Garnett and Others.
[1] http://www.techdigest.tv/2009/02/pirate_bay_tria_1.html.
[1]Indeed, at the time of writing the individuals behind The Pirate Bay have just been on trial in Sweden facing charges that have been brought against them by media companies including Sony and Warner Bros: http://news.bbc.co.uk/1/hi/technology/7892073.stm.
[1] Directive 2000/31/EC which was implemented in the UK by The Electronic Commerce (EC Directive) Regulations 2002.
[1] Preamble, paragraph 2, Official Journal of the EU L 178 , 17/07/2000 P. 0001 – 0016: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32000L0031:EN:HTML.
[1] ss.17-19, The Electronic Commerce (EC Directive) Regulations 2002.
[1] Ibid.
[1] MGM Studios, Inc. v. Grokster, Ltd. 545 U.S. 913 (2005)
[1] Opening paragraphs of Opinion of Justice Souter of the US Supreme Court in MGM v Grokster: http://en.wikisource.org/wiki/MGM_Studios,_Inc._v._Grokster,_Ltd./Opinion_of_the_Court.
[1] See Anti Piracy section of www.bpi.co.uk.
[1] Ibid.
[1] BBC News Website: http://news.bbc.co.uk/1/hi/entertainment/5140788.stm. A copy of one of the offending letters can be found at: http://wikileaks.org.uk/leak/davenport-lyons-letter.pdf.
[1] In some cases, an examination of the hard drive may be the only conclusive way to tell who had committed the infringing act, if the Internet connection was shared between several people.
[1] Schwartz, John (25 September 2003) “She Says She’s No Music Pirate. No Snoop Fan, Either” http://query.nytimes.com/gst/fullpage.html?res=9F07E3D9143DF936A1575AC0A9659C8B63.
[1]An extract from the Which website can be found at: http://www.which.co.uk/news/2008/12/which-challenges-bullying-letters-163975.jsp.
[1] Williams, Chris (15 February 2008) “Tiscali and BPI go to war over ‘three strikes’ payments” http://www.theregister.co.uk/2008/02/15/tiscali_bpi_agreement/print.html.
[1] Digital Entertainment Survey 2008, http://www.entertainmentmediaresearch.com/news/news.asp.
[1] Oates, John (3 July 2008) “Virgin warns 800 punters for file-sharing”
http://www.theregister.co.uk/2008/07/03/virgin_letters_numbers.
[1] Parrack, Dave (3 November 2008) “French Senate votes for ‘three strikes and you’re out’ piracy law” http://tech.blorge.com/Structure:%20/2008/11/03/french-senate-vote-for-three-strikes-and-youre-out-piracy-law/.
[1] Ibid at lxiv
[1] See BERR website: http://www.berr.gov.uk/consultations/page47141.html.
[1] http://www.culture.gov.uk/reference_library/media_releases/5783.aspx
[1] For example, see: http://www.torproject.org/.
[1] For more information about Usenet, see: http://www.newsgroupdownloaders.com/sslusenet.html.
[1] Ernesto (12 August 2008) “Download Torrents Anonymously with TorrentPrivacy” http://torrentfreak.com/download-torrents-anonymously-with-torrentprivacy-080812/.
[1] Fildes, Jonathan (23 May 2006) “Web inventor warns of ‘dark’ net” http://news.bbc.co.uk/1/hi/technology/5009250.stm.
[1] For example, see the Google service: Latitude http://www.google.com/latitude/intro.html.
[1]BBC News Website, 5 March 2009 http://news.bbc.co.uk/1/hi/technology/7925455.stm.
[1] CBC News Website (24 February 2009) “Can Sweden make the charges stick against The Pirate Bay?” http://www.cbc.ca/money/story/2009/02/20/f-piratebay.html.
[1] Norton, Quinn (16 August 2006) “Secrets of the Pirate Bay” http://www.wired.com/science/discoveries/news/2006/08/71543?currentPage=all.
[1] Ibid.
[1] Ibid. at lxxviii.
[1] Wikipedia, (8 March 2009): http://en.wikipedia.org/wiki/Economy_of_the_People%27s_Republic_of_China.
[1] Sanchez, Julian (18 February 2009) “Industry nominates usual suspects for piracy watchlist”. http://arstechnica.com/tech-policy/news/2009/02/2009-piracy-watchlist-names-usual-suspectsincluding-canada.ars.
[1] The Office of the United States Trade Representative “USTR Issues 2008 Special 301 Report” (25 April 2008) http://www.ustr.gov/Document_Library/Press_Releases/2008/April/USTR_Issues_2008_Special_301_Report.html.
[1] Ibid.
[1]World Trade Organisation (26 January 2009) “WTO issues panel report on US-China dispute over intellectual property rights” http://www.wto.int/english/news_e/news09_e/362r_e.htm.
[1] Ibid at lxxx.
[1] Digital Entertainment Survey 2008, http://www.entertainmentmediaresearch.com/news/news.asp.
[1] Nasir, Colin, “Taming the Beast of File Sharing – From Scare Tactics to Surcharges and Other Ideas: Potential Solutions to Peer to Peer Copyright Infringement, Part 3” [2005] ENT LR 105.
[1] Josefsson, Erik, European Coordinator of the Electronic Frontier Foundation, as quoted by Massey, Rohan, “Independent Service Providers or Industry’s Secret Police? The Role of the ISPs in Relation to Users Infringing Copyright” Ent. L.R. 2008, 19(7), 160-162.
BIBLIOGRAPHY
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Massey, Rohan, “Independent Service Providers or Industry’s Secret Police? The Role of the ISPs in Relation to Users Infringing Copyright” Ent. L.R. 2008, 19(7), 160-162.
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Nasir, Colin, “Taming the Beast of File Sharing – Legal and Technical Solutions to the Problem of Copyright Infringement over the Internet: Part 2” [2005] ENT LR 82.
Nasir, Colin, “Taming the Beast of File Sharing – From Scare Tactics to Surcharges and Other Ideas: Potential Solutions to Peer to Peer Copyright Infringement, Part 3” [2005] ENT LR 105.
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