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Subject: Big Suprise
Date: 12 Oct 1995 19:17:18 +0100
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Net has capitalists aquiver
Monday October 9, 1995
By Dan Keating
For totalitarian systems, the photocopier was a frightening piece
of technology. Fax machines were terrifying.
Capitalism, on the other hand, is aquiver over the Internet.
Information in electronic form can now be shared infinitely, for
free. A document placed on the worldwide computer network is
available to more than 30 million people, each of whom can make
copies at no cost and spread it further. Some envision this
fluidity of information creating a "universal intelligence" that
could propel humanity to unfathomable heights.
But capitalists warn of a fatal flaw: If folks get it free, no one
makes a profit. Without the profit motive, nothing will be done.
Electronic information, capitalists argue, must be protected from
the Internet's inclination toward free distribution.
The debate pits those who believe "Information Wants to Be Free"
against advocates of protecting intellectual property rights.
They're not just philosophical stances. The conflict will decide
how everyone gets information. It doesn't mean just text or
software. Digitized music, video, photographs and data all move
across the information superhighway, so much of what you see, hear
or read will be affected by the resolution of this debate.
A report released last month by the Patent and Trademark Office
(http://www.uspto.gov) painted a picture of what it called
New computers and networks make it possible, the report said, "for
one individual, with a few keystrokes, to deliver perfect copies of
digitized works" to countless others in the online world. "Just one
unauthorized uploading could have devastating effects on the market
for the work," the report said.
It recommended amendments to copyright laws to prevent unauthorized
The report won quick praise from the Business Software Alliance
(http://www.bsa.org), an industry group trying to protect
commercial programmers from piracy.
"The industry strongly supports legislative actions that will
ensure data security," said President Robert Holleyman.
But others are concerned about a crackdown.
"The research, education and library communities emphasize free
sharing of information in the course of their activities," said a
white paper called "Flow of Information" on the National Academy of
Sciences Internet site (http://www.nas.edu).
Even if a legal compromise is reached, enforcing it could be
impossible. Advocates of unlimited distribution via the Internet
have said that restrictions are fruitless, because violating them
will be so easy. Better to waive the laws than to have them flouted
by the new technology, they argue. The Patent and Trade Office
responded that international money laundering is eased by new
technology, but it won't be legalized.
The office supported a change in copyright law that would make it
a criminal offense only if the unauthorized copies are worth at
least $5,000. Someone making a duplicate at home wouldn't be a
criminal, but professionals could be prosecuted.
The application of copyright law shows that this debate has long
roots. Copyright came into existence shortly after the printing
press was created. The law prevents rogue printers from selling
copies of someone else's work. Copyright was jolted in the 1960s by
the emergence of photocopiers, which created a new world of
The new phase is vastly more grave, however. Photocopies and
duplicated audio cassettes and videotapes are all inferior to the
original. They all take some time and expense to create.
But digital information can be reproduced infinitely at virtually
no cost. And the copies are exactly the same as the original.
"It's the virtual original," said Steven Peretz, chairman of the
Florida Bar's Intellectual Property Law Committee.
"Now, the means of reproduction have been brought down to the grass
roots," said Peretz, of the Miami firm Kluger, Peretz, Kaplan &
Berlin. "Will copyright be responsive to changes in technology
where every computer operator is a mini-publisher?"
He noted that you could make a photocopy of War and Peace, but it
would be messier and harder to read than an inexpensive published
copy. That's not true, however, with digital information.
"Now with making a perfect clone," he said, "the duplicate is as
good as the original."
The first battle of this war was fought in the early 1990s over
digital audio tapes (DAT). They offered the quality of compact
discs with the copying ease of cassette tapes. Plus, each copy
would be perfect.
The recording industry was petrified. It lobbied and in 1992 was
rewarded with a law declaring that all DAT equipment manufactured,
imported or distributed in the United States must be disabled from
making unlimited copies. It's also unlawful to make, import or
distribute equipment to overcome that disability. And, finally,
importers and manufacturers of DAT equipment and DAT tapes must pay
a royalty to the recording industry for each unit sold.
The Patent and Trademark report cited the DAT case as an example of
effective protection for producers. But, in fact, DAT has failed to
become a major product, barely amounting to a blip in the consumer
market, even though it offers the advantages of CDs and cassette
tapes rolled into one.
And now the digital music battle has to be fought all over.
Digitized music can be transported in electronic format over the
Internet and stored on computer hard drives -- without any DAT
equipment. So can video images, photographs, documents and other
Unlike the DAT fight, the Internet battle for copyright protection
cannot focus on a particular piece of equipment.
Technological solutions are also suspect. Attempts were made to
create photocopiers whose output couldn't be copied again. Software
makers tried many means in the 1980s to prevent unlimited
reproduction of their computer programs.
But all of those techniques failed in the marketplace.
They were found unduly burdensome to legitimate customers, and
criminals were easily able to thwart them.
The copyright laws are already being contested on the Internet. The
Church of Scientology won a federal order to seize computers from
a disgruntled former member after he posted copyrighted church
documents and legal filings on the Internet. Elvis Presley's estate
was upset to find an Internet site with his photographs and lyrics.
The Florida Library Association's Intellectual Freedom Committee is
lobbying and using public education to try to keep information from
being choked by the copyright law.
"Librarians feel it's their professional responsibility to
interpret this law liberally for the reader," said Lawrence Miller,
chairman of the committee and director of university libraries for
Florida International University. "Whereas there should be respect
for intellectual property, we would want to make sure there's no
unwarranted intrusion into freedom of information."
Meanwhile, the publishing, entertainment, banking, retailing and
communications industries are rushing headlong toward the
information superhighway, all the while wondering who will figure
out a way to protect what they put there.
Peretz said the free market should be able to resolve the tension,
because it's in everybody's best interest to do so.
"If the producers can't profit from creating this intellectual
property, there won't be anything produced," he said. On the other
hand, "the publishers have the incentive not to go overboard in the
controls so they won't kill it."