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September 14, 2004

Copyright laws and Betamax

Today is SaveBetaMax day which urges people to call into their congressmen to prevent the INDUCE Act from becoming law. According to opponents of the legislation, it could set back copyright law for devices such as VCRs and Tivos in favor of copyright holders like television and movie studios.

It's worth forming an opinion on matters such as this legislation because copyright laws can have a direct impact on convergence technologies. I'm not an attorney and I don't pretend to understand the INDUCE Act, but there are several issues of copyright that could hinder innovation.

Sony v Universal (the BetaMax decision) was a court decision that ruled that it is legal for individuals to record copyrighted material off their television for personal use and set the stage for VCRs to be able to have record button, and it applies directly to PVR technology.

Typically, copyright holders have the ability to restrict duplication and distribution of their works, so one could argue Sony v Universal eroded some of the protection that copyright holders had. VCRs make it incredibly easy for people to duplicate copyrighted material and sell it to their friends, a clear violation of copyright law.

On the other hand, there is a legal concept called First Sale Doctrine that protects the rights of people who purchase copyrighted material. Early on, copyright holders were arguing that they should be able to set the price of their works even after it had been purchased by a consumer. They also argued that if the consumer sold a used book, they would be committing a violation of copyright law.

First Sale Doctrine, developed by case law in the courts, said that when a consumer purchases a copyrighted work like a book, they have some legal rights of ownership of their own. Book owners can lend a book to a friend for instance, sell it at a price they determine, and even destroy it without getting permission by the copyright holder. This doctrine makes the movie rental business legal, for instance.

So what does it all mean in the digital age? It's still all being worked out. For instance, is it legal to create a DVD of PVR'd show? Can you duplicate a DVD that you rightfully own for your own personal backup? If you play a DVD on your computer, is it breaking copyright law because the bits are being duplicated in memory before they are played on screen? These things are all being debated in congress and in the courts but depending on where the line is drawn, it could impact future innovation.

Clearly, p2p users basically don't want any copyright laws at all and music producers and movie studios want stronger protection against duplication of copyrighted material. Without copyright laws, there would be little money to create new works. With laws that are too strict, copyright holders will stifle the market for consumer products like Tivo and drive the prices up and limit access.

Tivo, and other PVR providers that are cash starved, walk a tightrope every day to avoid litigation as you can see by their recent decision to limit the storage time for Pay for View movies. I don't know if the INDUCE Act is good or bad legislation, but it's important to make up your own mind because laws like this can have an impact on you and your wallet.

(Hat Tip: BYOPVR)

Posted on September 14, 2004

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