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Fair Use Under Scrutiny During CEA Panel

The ongoing debate over digital content protection appears to be deeply mired in varying inter-industry interpretations of consumers’ fair use recording rights.

That seemed to be the prevailing theme of a panel discussion on copy protection during the recent Fall Conference of the Consumer Electronics Association, here.

Panelist Scott Dinsdale, Motion Picture Association of America digital strategy executive VP, led the discussion by saying consumer fair use recording rights, as defined by the landmark Betamax case, are “contextual.”

The panel also included Pamela Samuelson, UCLA at Berkley School for Information Management and Systems professor; Joe Kraus, founder; Bob Perry, Mitsubishi Digital Electronics America marketing VP; L. Gregory Ballard, SONICblue CEO; and Cary Sherman, president of the Recording Industry of America Association.

“Saying that consumers have the ability to copy a program, and share it with family members and a few friends in their household is quite different from being able to share it with millions of your closest friends,” Dinsdale said. “To ignore that contextual change is simply silly.”

But SONICblue’s Ballard, whose company is currently defending a lawsuit to prohibit sales of ReplayTV personal video recorders that enable sending programs out of the house to owners of similarly featured ReplayTV recorders, said the arguments from the content community are inconsistent.

“The problem I have is that we have totally different views of what fair use means,” Ballard said. “Saying that, in context, it’s fine to send something around to a few friends, but it is not alright to send it around to millions of people, is entirely at odds with the 28 plaintiffs who are suing us, claiming that our use of SendShow — which sends shows to a controlled group of friends who own ReplayTV devices, who in turn cannot send it on to anybody else — is a contradiction to that context.”

Dinsdale countered: “Watching in the home is one thing but when you get to the issue of starting to send it to people who have their own ability to receive programming, I think that’s when you have clearly crossed the line.”

Perry, who is a member of the Broadcast Protection Discussion Group, which recently drafted a proposal for “a broadcast flag” in digital television programs to restrict the ability to redistribute content on the Internet, said the problem is that “consumers’ fair use rights are bumping up against varying business models. Content producers “are really worried about” protecting the ability to prevent programming available for U.S. distribution from being illegally distributed into other countries, where content producers traditionally derive additional revenue for that material.

Perry said the CE industry is sympathetic to the content producers’ concern about preserving their various business models, which is why they have drafted a broadcast flag proposal that is now being reviewed by the Federal Communications Commission.

“I support the concept of the broadcast protection flag as a very limited effort to ensure that copyrighted content is not distributed willy-nilly to millions of users — ‘getting Napsterized’— because that is a violation, and I think the CE industry believes that. But we continue to live in fear and concern that this is the first cut of a thousand cuts.”

Kraus, of the consumer advocacy organization, said “I think the issue is less fair use. You always have evolving customer expectations in any business. You have to continue to meet or exceed those expectations. And I think that’s what the debate is about.

“I agree that the threat is contextual, but I also think that fair use is contextual,” Kraus continued. “To say that any redistribution of content over the Internet is not allowed is unwise policy in my opinion, because it cuts off several important innovations that we haven’t even considered and that people out there in the room are thinking about.”

Sherman of the RIAA asked the panel to explain the success of DVD players.

“That was a product where the fair use concept was basically negotiated among the different groups with the intent of making it a viable product for consumers, with reasonable protections for content,” he said.

Perry responded: “We all have to remember that we ultimately serve the consumer, and the decision that was made with DVDs regarding the CSS encryption system, and by curtailing fair use — we made the decision without the consumer in the room to push a business model forward.

“That’s how we ended up with things like the Digital Millennium Content Protection (DMCA) and those kinds of issues,” he continued. “The consumer did not consent to give up any of their fair use rights with DVD. It was strictly a business model application. So while consumers may like DVDs, they ultimately expect to record DVDs, and be able to copy DVDs. We will see the real friction in DVD next year when the technology allows it [copying], and the policy doesn’t.”