Net copyright rules stir firms
Internet broadcasters and network service providers say the government's proposed regulations will thwart the budding online multimedia market.
"The regulations effectively take sides in long-standing and heated debates over legal and technological policy that are better left for resolution by Congress than the Copyright Office..." states one document, filed Monday by the Coalition of Internet Webcasters, a trade group that represents Web streaming companies. The coalition, which formed in response to the proposed regulations, was joined by the United States Telephone Association, a 100-year-old trade group, which filed a separate petition on Tuesday.
Both groups accuse music industry groups of using a process for implementing the 1995 congressional act to push self-serving recommendations on hot-button issues that have bitterly divided industries for years. Both petitions accuse the Recording Industry Association of America, which represents record companies, and the National Music Publishers Association, which represents artists, of making an end run around Congress in order to forward their agendas.
At the heart of the skirmish is the issue of how to treat temporary computer files that networks make when one machine hands off content to another. The issue is by no means new and has been the subject of several lawsuits and a number of legislative proposals, including an international conference hosted last year by the World Intellectual Property Organization. Generally speaking, companies that create software, movies, and other content say there are instances where temporary files should be considered legal copies under copyright law, while companies that play a role in transmitting content feel strongly those files should not carry the designation.
At least two bills now before Congress attempt to clarify the status of temporary files stored in a computer's memory. Both the Digital Copyright Clarification and Technology Education Act--sponsored by Sen. John Ashcroft--and the Digital Era Copyright Enhancement Act--sponsored by Rep. Rick Boucher--would prevent temporary files from being designated copies under copyright law. (See related story)
But under the proposed regulations, "incidental" files made in the course of a Web broadcast could be construed as a recording, subjecting Web streamers and ISPs to royalty fees that they say would threaten their current business models.
According to Seth Greenstein, an attorney representing Webcasters AudioNet, RealNetworks, and Terraflex Data Systems, the regulations don't define exactly what constitutes an incidental copy. In their current form, "the regulations imply that the little bit of buffer memory [stored on an end-user's PC] could be deemed a record delivery and the potentially full royalty rate would also apply," said Greenstein, who is an attorney at Washington-based McDermott, Will & Emery.
The regulations could be disastrous for companies that play a hand in moving sound recordings or video that includes sound across the Internet, said Terrence Carroll, associate counsel for Creative Labs, which makes soundblaster cards and other PC peripherals.