February 2008

This morning, one of the authors of the iPhone paper I mentioned earlier this week defends his views against Gans’ comments. One thing about Dale’s defence struck me as interesting, and that was this:

Professor Gans correctly makes the point that Apple could try and obtain permission (technically, an exclusive dealing notification) from the ACCC. Actually obtaining that permission is not a given. I think that the ACCC might well object, which they can do if they are not satisfied that the public benefits of the third-line forcing would outweigh the public detriment, and I think that balance would be weighing against Apple.

Hmmm. Firstly, I’m not sure it’s correct to characterise notification as meaning the ACCC gives ‘permission’. In fact, my reading of the Act suggests that lodging a notification provides automatic immunity from the date it is lodged with the ACCC (or soon after in the case of third line forcing conduct) and remains in force unless revoked by the ACCC.

Secondly, while it is technically true that non-revocation by the ACCC is not a ‘given’, they’re not exactly in the business of revoking these things. The statistics to some extent speak for themselves. According to the ACCC’s 2006-2007 Annual Report, page 92:

  1. In 2006-2007, the ACCC received 694 new notifications, and revoked 2 (that’s a revocation rate of 0.3%). 9 were withdrawn by the notifier.
  2. In 2006-2006, the ACCC received 1099 new notifications, and revoked NONE (that’s a revocation rate of zero %). 6 were withdrawn by the notifier.

Also, in determining whether a notification should be revoked, the ACCC has to take into account whether the detriment caused by the arrangement outweighs the benefit. The ACCC’s guide to exclusive dealing notifications on page 8 records the ACCC’s view that “[t]he detriment will be more limited when potential buyers of [the iPhone] have alternative sources of supply for [the iPhone] or substitute products.” Surely, except to the most ardent Apple fanboy, there are numerous economic substitutes for the iPhone (as indeed Gans pointed out).

Again, IANACL (I am not a competition lawyer). But I’m not yet convinced of this one.

Update: Gans responds. And the discussion is ongoing over on CoreEcon in the comments to that thread.
Further update: Clapperton is also getting into the discussion.

Some colleagues of mine (Paul H. Jensen, Alfons Palangkaraya and Elizabeth Webster), from the Melbourne Institute of Applied Economic and Social Research, have published a new Working Paper that would be of interest to people who, like me, are fascinated by international dynamics in patenting. The paper is called ‘Application pendency times and outcomes across four patent offices‘.

OK, so it’s not the most exciting title in the world. But here’s the thing. They’ve got matched patents applied for in Europe, the US, Japan and Australia, and worked out differences – in outcomes, and how long it takes to get a patent – for the same invention. They’re measuring differences in approach between the different patent offices! How many people do you know who can do that? Here’s an extract from the introduction: (more…)

Australian IT reports today that, despite an ACMA report questioning the use of filters for today’s challenges to child safety online (see this post),

‘The federal Government’s plan to have internet service providers filter pornography and other internet content deemed inappropriate for children is going full-steam ahead. Trials are to be conducted soon in a closed environment in Tasmania.’

‘A closed environment in Tasmania’. Must. Avoid. Obvious. Jokes. At least Brian Harradine would be pleased.

See also ZDNet here.

Seen on New York Times website today…

You might remember late last year Senator Conroy, Minister for Everything Cool and Funky (otherwise known as Minister for Broadband, Communications and the Digital Economy) coming out with a suggestion that Australian ISPs should start imposing ISP-level filtering of naughty-stuff. A few Australian internet-y types discussed this at the time, notably Pete Black at Freedom to Differ, and Dale Clapperton at Defending Scoundrels.

So it’s interesting that ACMA has released a new report, entitled Developments in Internet Filtering Technologies and Other Measures for Promoting Online Safety. And you have to love the conclusion from the Executive Summary:

‘…the report highlights that as users increasingly engage with interactive internet technologies, the online risks have shifted from content risks associated with the use of static content to include communications risks associated with interaction with other users…
…At this time, filtering technologies are regarded as suited to addressing particular static content risks.’

ACMA are of course careful to say that ‘clusters of measures can be more effective in minimising risks than single initiatives’ (translation:if we do lots of stuff, then maybe some of it will work). They also note that the UK ‘CleanFeed’ system, which blocks only 1,500 sites, can be deployed at an ISP level – although it addresses only a very specific (child pornography) issue.

Overall, you would have to say that the report (at least on a brief skim) is not exactly a resounding endorsement for filtering, beyond, perhaps, a blacklist of some very specific sites (and even there there is a lack of enthusiasm). (more…)

I’ve been reading through the Australian Copyright Council‘s publication, ‘The 2006 Copyright Amendments‘ (B129v01, December 2007), and I found an interesting couple of paragraphs on parody. They discuss the ‘Fanatics Songbook‘ – a songbook produced for Australian cricket fans that took, and twisted, popular songs to make comments about Australia’s cricketers and the cricketers on opposing teams. The songbook was specifically cited in an opinion piece by the then Attorney-General, Philip Ruddock, as an example of Australia’s sense of humour, newly protected by the new parody defence to copyright infringement.

According to the Australian Copyright Council however,

‘It is doubtful … that The Fanatics’ use of the song lyrics constituted parody or satire, or was ‘fair’ in the circumstances. The purpose of using the lyrics was to support members of the Australian team and/or to taunt members of the English team. This is not parody, and it is difficult to categorise it as satire – unless, perhaps, the desire of the English team to win the match could be characterised as ‘folly’ [he he - Ed.]. The songbook reproduced some of the lyrics in full ['Some' of the lyrics 'in full'? What does that mean? - Ed], without any changes, which would make it difficult to characterise the use as ‘fair’, given that the reproduction of song lyrics is an activity normally licensed by music publishers.’

So, people, whaddaya think? Is this another case of the Cabinet not understanding the effect of the laws it was approving? Or just an overly-narrow view on the part of the Australian Copyright Council? For extra bonus points, discuss the relevance of the Attorney-General’s opinion piece (published simultaneously with Parliamentary debate on the new exception) to the interpretation of section 41A with reference to ordinary principles of statutory interpretation.

All over the press today that QUT people Dale Clapperton (of Defending Scoundrels) and Stephen Coroneos have published a paper arguing that a deal that saw the iPhone locked to a single telephone network could breach competition laws.

I’m not a competition lawyer, so I’m not really in a position to assess the validity of the argument from a legal point of view. Nor am I an economist, so I’m not able to tell you whether a deal like the iPhone one would actually pose a danger for competition. But Joshua Gans is, so head on over there for his views. In a word, not impressed. Ouch.

[Image by Hawken King, licensed under CC-BY]

Look, ACMA even had a press release.

How very disappointing for me.

Several people have pointed out to me that according to the SMH, like the UK government,

[t]he Rudd Government is considering a three-strikes policy against computer users who download songs illegally.

According to the SMH,

The Government will examine new legislative proposals being unveiled in Britain this week to target people who download films and music illegally. Internet service providers (ISPs) there might be legally required to take action against users who access pirated material.

Communications Minister Stephen Conroy said the Government was aware of the views put by the music industry for a code of conduct for ISPs to address file-sharing by subscribers.

“We will also examine any UK legislation on this issue [including any three-strikes policy] with particular interest,” he said.

Now, admittedly, I’m an academic in Queensland – I’ve got no idea what is going on in Canberra. But it is worth noting that (a) it would be really weird if the Australian government did not ‘observe with interest’ what happens in the UK, (b) it would be equally weird if the Australian government did not ‘consider’ proposals put by industry, and (c) none of this is new – industry (in the form of MIPI most significantly) have been making this argument for some time (here, here.)

So I’m not presently feeling the need to spend a lot of time on this. Let’s just summarise the main problems with this approach, shall we? (more…)

At least according to Richard Sennett, in his book The Craftsman: according to Sennett, craftsmanship has not vanished from our world: it has migrated to other regions of human enterprise, so that the delicate form of skilled cooperation that once produced a cathedral now produces the Linux software system. Linux, for Sennett, is the work of a community of craftsmen “who embody some of the elements first celebrated in the (Homeric) Hymn to Hephaestus”. There. See? The Cathedral and the Bazaar.

On proposing a 95 year term for copyright in sound recordings:

“I strongly believe that copyright protection for Europe’s performers represents a moral right to control the use of their work and earn a living from their performances…” [European commissioner Charlie McCreevy; press release here]

Today I read a paper in the latest IP Forum Magazine on ‘Trade Mark Counterfeiting – the Australian Problem’, by Corrs partner Stephen Stern. I read it in part because just recently, Australia decided to join the negotiations on the Anti-Counterfeiting Trade Agreement (ACTA) (which I’ve discussed here and here). Stern’s article is an interesting read; some of the discussion of ‘counterfeiter techniques’ in particular was interesting. As you can imagine, given that Stephen acts for brand owners, and given the title, the article was in part a plea for movement from the government – a plea, in short, for law reform.

What struck me, however, was the vagueness of the call for reform. And in the general spray of bullets that are the kinds of reforms he discusses, I think there’s some danger of collateral damage. (more…)

Bill Patry today has an interesting post on the politics of the current Canadian copyright reform discussion, noting, in particular, the ‘bullying’ of the ‘International’ Intellectual Property Alliance (International in the same way as World Series Baseball, by the way, as Patry points out). Bill’s final point is, I think, a good one:

The intense, negative reaction of Canadian citizens to IIPA’s efforts is well-taken. Why any government would want to adopt approaches that have been admitted to be a dismal failure in the U.S. by the law’s own ardent author, and that are not required by the WIPO treaties is a mystery.

I think what interests me about what is going on in Canada is exactly that – the ‘intense, negative reaction’. I think, in part, this kind of intense, negative reaction is, as Patry points out, because the relevant laws have not been proven to work at all. I also think the reaction happens for reasons that Michael Geist points out in his ‘Why Copyright’ talk – it’s about the effects that harsh copyright laws can have – on creativity, on fun stuff that people like to do, on free speech; it’s about the mismatch between copyright law on the one hand, and ‘the real world’ and the possibilities of technology that we can all see on the other.

It’s worth pointing out, though, that there’s a broader geopolitical context to this. In part, the ‘intense, negative reaction’ is a reaction against the high-handed, ignorant, contemptuous attitude of the US – US industry in the form of the IIPA, and the US government in the form of the USTR – an attitude that says that unless your law looks exactly like ours, it must be inadequate – oh, and by the way, we have nothing to learn from you; your laws could not possibly be as good as ours. I think that the copyright debate – because it is one in which that attitude is taken to extremes – crystallises a more general concern about the US ‘attitude’, as illustrated in its lobbying and trade negotiations and treaty negotiations – to the rest of the world. Similarly, I think that the copyright push by US industry and government has broader geopolitical costs to the US – it is feeding anti-American sentiment. A colleague and I have outlined this in excruciating detail in a recent paper, and I’m seeing the same thing happen in Canada.

On a positive side, it’s rather good to see some US companies in Canada pushing on the other side. That might help limit the damage to US interests more generally.

Update: see also Howard Knopf.

Blogosphere is a-buzz with leaked news that the UK government might be considering requiring ISPs to monitor copyright infringement, and terminate repeat offenders. See Technollama, the IPKat, TechCrunch here, Boing Boing, Techdirt here, and the original Times Online here, . According to the Times:

Users suspected of wrongly downloading films or music will receive a warning e-mail for the first offence, a suspension for the second infringement and the termination of their internet contract if caught a third time, under the most likely option to emerge from discussions about the new law.

There has been a similar push in Australia by MIPI in particular; I’ve elsewhere (here and here) analysed the MIPI proposals and raised a number of questions about them (similar to the questions most of the blogosphere is raising). What I think is interesting about the UK developments is that it illustrates just how global this particular push is – looks like we have a coordinated (and more recently, more concentrated) push going on across a range of jurisdictions for a similar ‘notice and terminate’ kind of system. Here in Australia, though, it would be very ironic to see ‘Mr Broadband’ Kev Rudd legislating to switch off people’s internet contrary to presumptions of innocence and the like.

Frankly, too, it still seems like a proposal that is several years behind the trend of infringement. P2P is so, well, 10 years ago; bittorrent is used for all kinds of things (much more so than Kazaa or the like could ever claim), and the easiest way to ‘share’ copyright material is computer to computer.

Update: Open Rights Group put some of the problems well:

In most families, an internet connection is shared by the entire household – so if Dad gets the connection cut off for sharing movies online, suddenly Mum can’t run her business from home, and the kids can’t get access to the Web to do their homework. The Times estimates that there are 6 million people in the UK who share files illegally on the web. Any serious move towards disconnecting offenders is likely to play havoc with the Government’s ambition to foster an e-enabled society.

What’s more, as soon as law enforcers start snooping for IP addresses to pass on to ISPs for disconnection, hardcore filesharers will simply start using encryption to obfuscate their identities. Then they’ll develop software that makes it easy for non-technical people to do the same. And then industry will be back to square one.