HolidayBuyer's Guide

FAQ: Betamax--tech's favorite ruling

A 1984 Supreme Court decision legalized the VCR and provided much of the legal context for today's consumer electronics industry.

On Tuesday morning, lawyers from Hollywood and the technology industry will meet at the U.S. Supreme Court to argue over the fate of peer-to-peer software. But they'll be spending much of their time talking about the VCR.

At the core of the file-swapping dispute is an interpretation of the 20-year-old decision that made Sony's Betamax legal to sell in the United States. Much of the subsequent consumer electronics industry has been built with that decision in mind, and now companies are worried that it's open for review.

The following list of frequently asked questions is a layman's guide to why the Betamax ruling matters today.

Isn't Tuesday's Supreme Court case about Grokster and file-swapping? What's all this about Betamax?
Two lower federal courts have ruled that file-swapping software companies--in this case, Grokster and Morpheus parent StreamCast Networks--aren't legally liable for the copyright infringement that happens on their peer-to-peer networks. For support, both courts pointed to the 1984 Supreme Court ruling that said Sony Betamax VCRs could be legally sold.

Many people inside the technology industry believe that the Betamax decision laid the foundation for much of the subsequent computer and consumer electronics industry. Some worry that a new ruling on the issue could change the legal ground rules for technology businesses.

How would my life be different without the Betamax decision?
The Betamax ruling established that it was possible to record media at home, as long as it was for personal use. It made sure that companies producing recording devices couldn't be sued, even if some people used them in illegal ways. If Betamax had gone the other way, the explosion in VCRs, rental movies, home DVDs and digital video recorders couldn't have happened, or would likely have been slower and more expensive.

The case also let personal computers, which can digitize and record audio and video, develop without restrictions.

What started the fight?
Sony released the Betamax video recorder for the United States market in 1976. Universal City Studios and Walt Disney Productions promptly sued Sony, contending that recording video at home was copyright infringement.

Why did they sue Sony, instead of the people making the recordings?
The studios made an argument called "contributory copyright infringement," saying that Sony was responsible for making large-scale copying possible.

What were video recorders actually being used for?
The case largely took place before the tape rental market had taken off. Surveys by Sony and the studios showed that the primary use for VCRs, at least in 1978, was recording TV content so it could be watched later.

Was recording a show at home actually illegal?
At the time, it wasn't clear. The studios said home recording was illegal if permission hadn't been granted beforehand. Some shows explicitly gave viewers the right to record, or gave guidelines on how long tapes could be kept before being erased.

How did the case get to the Supreme Court?
The District Court initially ruled in favor of Sony, saying that "time-shifting"--recording a show so it could be watched later--was legal. But even if it had been deemed copyright infringement, the court said Sony couldn't be held legally responsible for those actions.

A court of appeals decision upended that judgment, saying that copying TV programming at home was not fair use. Because videocassette recorders were sold primarily for making copies of copyrighted works, the court said Sony should be liable for damages, and potentially should be barred from selling VCRs.

Who supported the studios?
Amici, or "friends of the court," briefs were filed in support of the studios by the Association of American Publishers, CBS, the Motion Picture Association of America, the National Music Publishers Association, the Recording Industry Association of America and the Writers Guild of America, among others.

Who supported Sony?
Amici briefs were filed in support of Sony by the American Library Association, the Consumer Electronics Association, GE, Hitachi, Sears, Toshiba and 12 states, among others.

What did the Supreme Court rule?
In 1984, after seven years of litigation, the Supreme Court largely upheld the lower court's initial ruling. In the most far-reaching portion of that decision, that court said flatly that a product is not liable for contributory infringement if it is also used for legitimate purposes. "Indeed, it need merely be capable of substantial noninfringing uses," the court wrote.

The court also held that home recording, at least for the noncommercial use of "time shifting," was not infringement.

If copying at home is OK, why are people being sued for file-swapping?
People who are uploading music though peer-to-peer networks aren't viewed as doing it for personal use. Their actions potentially have an effect on the market for music or videos in a way that recording a TV show and watching it later does not. Record labels have said that "ripping" a CD to MP3 files, or burning a few copies, as long as they're for personal use, is OK.

OK, but why isn't DVD-copying software legal?
Home copying is legal, but entertainment companies aren't required to let you do it. There's another law called the Digital Millennium Copyright Act which makes it illegal to break through any antipiracy protections put on digital media. Movie studios protect their DVDs against copying, and so all the software that breaks through this protection is illegal to distribute in the United States.

Most memorable quote on the issue:
In 1982, testifying in front of Congress before the Supreme Court had ruled, MPAA President Jack Valenti said, "I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone."

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