National Academies: New Framework Proposed for Protecting Intellectual Property

[James Love <love@cptech.org>]

http://www4.nationalacademies.org/news.nsf/isbn/0309064996?OpenDocument


                Date: Nov. 3, 1999
Contacts: Bob Ludwig, Media Relations Associate
David Schneier, Media Relations Assistant
(202) 334-2138; e-mail <news@nas.edu>

EMBARGOED: NOT FOR PUBLIC RELEASE BEFORE 10:30 A.M. EST
WEDNESDAY,
NOV. 3

New Framework Proposed for Protecting Intellectual Property
Rights And Public Access to Electronic Information

WASHINGTON -- Novel business models and new technologies to
protect intellectual property, as well as education in copyright
law, are all likely to be far more effective mechanisms than
major legislative changes for protecting electronic information
at this time, says a new report from a committee of the National
Research Council of the National Academies. These methods should
be used to complement existing copyright laws that protect owners
and distributors of digital information while maximizing access
and use by the public. Digital intellectual property is
fundamental to the growth of electronic commerce, and
the way it is handled has broad implications.

Legislators should delay any overhauling of intellectual property
laws and public policy until markets have had ample time to
adjust to new models of doing business and until sufficient
research on the issues is conducted, the report says. To help
legislators effectively formulate or revise laws and policies in
the future, the committee articulated a set of broad, guiding
principles that offer advice about creating laws in a period of
rapid technological change.

"Information has increasingly become an event to be experienced,
rather than an artifact to be kept," said committee chair Randall
Davis, professor, computer science department, Massachusetts
Institute of Technology, Cambridge. "The question of how to
control distribution and use of digital information is much more
than a legal issue alone. Law, business, and technology all
interact, hence approaching the problem from a single viewpoint
will be inadequate. Many stakeholders are affected; anyone with
an interest in 'e-commerce' will feel the consequences of the
decisions made on this topic. A broad framework is needed
to address all aspects of the public and private interest and to
ensure the future vitality of the Internet economy."

The ease of distributing and altering digital information, and
the proliferation of computer networking, raise concerns about
copyright and patenting -- protections rooted in the U.S.
Constitution. As technology continues to evolve, policy-makers
will experience ongoing uncertainty and frustration when
grappling with the issues that these changes bring. The
committee concluded that technology must be viewed as only part
of the picture and not the driving force for new laws and
policies. The focus should be on the underlying issues that
influence market behavior, such as consumer attitudes regarding
digital information and new opportunities to generate,
distribute, and profit from it.

For example, the basic concept of publication should be
re-evaluated and clarified, the report says, in part because the
information infrastructure -- computer networks and the World
Wide Web -- has changed what is meant by "publishing." In the
physical world, publication has three important characteristics:
it is public, irrevocable, and provides a fixed copy of the
work. In the digital world, none of these may be true. For
instance, software can be designed to restrict public access to
digital information, and old information is routinely overwritten
with new. This distinction matters as a basic element of
intellectual property policy, and knowing whether a work is
published has significant legal consequences for those who
distribute it.

Digital intellectual property and the information infrastructure
are prompting a re-examination of the "first-sale" rule, which
says that the initial sale of a copy of a work exhausts the
copyright owner's right to control further distribution. Thus, an
individual, a library, or other entity is free to give away,
lend, rent, or sell its copies of books. But in the
digital environment, consistent implementation of the rule has
become more complex.  Because of the pervasive reach of
electronic networks, a single copy of a work available from
a digital library could diminish the market for the work much
more than if it were distributed only in hard copy. Maintaining
the limited degree of access to published materials that was
established for hard-copy versions of information must continue
in the digital environment, the report says.

Information providers are using licensing provisions and
technical protection services to manage access. Licensing is
commonly used to provide access to some types of digital
information such as software, and more recently is being applied
to research journals and scientific databases. This practice is
stirring controversy because access expires after a
pre-determined length of time. The issue is particularly
important with mass-market licenses -- for example, "shrink wrap"
licenses for software and other products -- which offer no
opportunity to negotiate terms. Licenses are contracts, and thus
are under no obligation to include the important elements of
public policy found in copyright law, such as "fair use." If
these types of licenses come into widespread use for content
distribution, there is the potential for contract law to become a
widespread substitute for copyright law, the report
says. That would imply a change in the balance of private
ownership and public access associated with copyright.

Some technical protection services offer the owners of digital
information some assurance that distributing a single copy of a
digital work does not result in uncontrollable dissemination, by
making it difficult for consumers to save or print it. The
committee concluded, however, that this may have adverse effects
on accessing and preserving our permanent social and cultural
heritage, since digitized material could easily be withdrawn from
circulation.

Given the availability of alternative mechanisms that offer most
of the advantages and far fewer risks than electronic
distribution, not every information product should be distributed
by digital networks, the report says. High-value, long-lived
products, such as classic movies like The Wizard of Oz, may never
be made legally available on the Internet while protected under
copyright, because the consequences of an individual capturing
the movie in digital form are too great. The technical, legal,
and social enforcement costs of ensuring that this does not
happen are also prohibitive.

Copyright and Fair Use

Copyright is the area of intellectual property law that is most
frequently highlighted in the
continuing debate over digital information and legal protection.
With the increasing use of digital information, consumers need a
better understanding of the basic principles of copyright law,
the report says. The music industry, for example, has had to
implement new ways of doing business to address copyright
violations that occur when copyrighted music from compact disks
is converted to MP3 format and widely distributed on the
Internet. The committee recommended that an education program be
launched to emphasize the benefits -- such as a vibrant market in
information products and protecting the rights of authors --
that copyright law provides to all parties.

"Fair use" is an established doctrine of U.S. copyright law that
has come under stress with the proliferation of digital
information. Of particular concern is the extent to which copying
for private use can be justified without violating the law.
Legal, economic, and public-policy research should be undertaken
to help determine the extent to which fair use and other
exceptions and limitations to copyright should apply in the
digital environment. The committee recommended that policy-makers
take considerable caution when contemplating changes to law or
policy.

Business Models

The rapidly evolving World Wide Web is an effective environment 
in which to experiment with business models for marketing,
selling, and distributing products and services electronically,
the report says. Producers of digital information should give
careful consideration to the power that innovative business
models can offer, such as those being used in the music
industry.

Choosing an appropriate model that is easy to use may encourage
consumers to pay a fair price for the service, rather than
looking at other, more cumbersome and technologically
complex or legally burdensome ways to obtain that service.
Numerous new business models and mechanisms are being created and
tested. This process should be supported and encouraged, to allow
time for sellers to find a model or mechanism that fits
particular products, the report says.

Digital Archives

Little progress has been made in archiving digital information to
preserve the nation's cultural heritage and record intellectual
discourse, the committee noted. Significant economic, legal,
and technical issues must be resolved if archives and libraries
are to act as repositories of digital information. The report
says that Congress should enact legislation to permit copying
digital information for archival purposes. Moreover, a task force
organized by an unbiased entity with a national reputation, such
as the Library of Congress, should be established to
develop a legal and procedural framework that governs electronic
deposits of digital information and how files are used in the
future.

'Copy' in Copyright

The committee raised the question of whether the notion of a
"copy" remains an appropriate foundation for copyright law in the
digital age. Current copyright laws address concerns
surrounding the copying of texts without the publisher's or
author's consent. But with digital information, accessing data
means duplicating it. For example, when viewing a Web page,
information is automatically downloaded from one computer to
another. As a result, so many legal copies are now routinely made
when accessing digital information that it is becoming
more difficult to apply existing copyright laws effectively to
this pervasive activity. In addition, because copying is directly
related to the way computers function, control of
copying would provide powers that go beyond those intended by
copyright law. Therefore, the committee suggested exploring
whether a new basis can be constructed.

The study was funded by the National Science Foundation. The
National Research Council is the principal operating arm of the
National Academy of Sciences and the National Academy
of Engineering. It is a private, nonprofit institution that
provides independent advice on science and technology issues
under a congressional charter. A committee roster follows.

Prepublication copies of The Digital Dilemma: Intellectual
Property in the Information Age are available from the National
Academy Press for $47.95 (prepaid) plus shipping
charges of $4.50 for the first copy and $.95 for each additional
copy; tel. (202) 334-3313 or 1-800-624-6242. Reporters may obtain
a copy from the Office of News and Public Information (contacts
listed above).


NATIONAL RESEARCH COUNCIL
Commission on Physical Sciences, Mathematics, and Applications
Computer Science and Telecommunications Board

Committee on Intellectual Property Rights
and the Emerging Information Infrastructure

Randall Davis (chair)
Professor
Computer Science Department
Massachusetts Institute of Technology
Cambridge

Shelton Alexander
Professor of Geophysics
Pennsylvania State University
University Park

Joey Anuff
Producer
Wired Ventures
San Francisco

Howard Besser
Associate Professor
Department of Information Studies
University of California, Los Angeles

Scott Bradner
Senior Technical Consultant
Office of the Provost
Harvard University
Cambridge, Mass.

Joan Feigenbaum
Department Head
Algorithms and Distributed Data
AT&T Labs - Research
Florham Park, N.J.

Henry M. Gladney
Researcher
IBM Almaden Research Center
San Jose, Calif.

Karen Hunter
Senior Vice President
Elsevier Science Inc.
New York City

Clifford Lynch
Executive Director
Coalition for Networked Information
Washington, D.C.

Christopher Murray
Chairman
Entertainment and Media Department
O'Melveny & Myers LLP
Los Angeles

Roger Noll
Morris M. Doyle Centennial Professor of Public Policy
Department of Economics
Graduate School of Business
Stanford University
Stanford, Calif.

David Reed
Vice President
Cable Television Laboratories Inc.
Louisville, Colo.

James Rosse
President and Chief Executive Officer
Freedom Communications Inc.
Irvine, Calif.

Pamela Samuelson
Professor
School of Information Management and Systems, and
School of Law
University of California
Berkeley

Stuart Shieber
Gordon McKay Professor of Computer Science
Division of Engineering and Applied Sciences
Harvard University
Cambridge, Mass.

Bernard Sorkin
Senior Counsel
Time Warner Inc.
New York City

Gary Strong
Director
Queens Borough Public Library
Jamaica, N.Y.

Jonathan Tasini
President
National Writers Union/UAW Local 1981
New York City

RESEARCH COUNCIL STAFF

Alan S. Inouye
Program Officer 

    

  								

-- 
James Love / Director, Consumer Project on Technology
http://www.cptech.org / love@cptech.org
P.O. Box 19367, Washington, DC 20036
voice 202.387.8030 / fax 202.234.5176