Policing the Internet

Steve Case, America Online chairman, CEO

To software companies, one solution to preventing piracy is simple: Have Internet service providers look for unusual traffic patterns on their networks and report any suspicious activity.

But what one person considers unusual might seem perfectly normal to the next. And how will users feel if they begin getting unexpected phone calls from a stranger inquiring what they were looking at on their screens at home just a few minutes ago?

"Customers would be very upset, and I would agree," said Andreas Glocker, president and CEO of Sirius Connections, a small ISP in San Francisco. "I grew up when the Net was freewheeling, anything goes. It seemed to work for everyone."

Everyone, that is, except for software publishers. That's why they have lobbied hard on the issue of service provider liability in far-reaching copyright treaty negotiations now being held by the World Intellectual Property Organization in Geneva, Switzerland.

What worries service providers most about such "third-party liability" is the danger of precedence: Once they agree to accept any responsibility for objectionable content, no matter how small, they fear that they will be held increasingly accountable as copyright holders and their lawyers seek to blame them for transmitting illicitly obtained material--not because they knew it existed, but because they should have known.

The treaty provisions could make online services and ISPs "liable without knowledge for every potentially infringing communication on the Internet," complained a group of CEOs from leading Internet service companies this week in a letter to President Clinton. The companies, which included America Online, MCI Communications, and CompuServe, worry that "such potential liabilities would force us to monitor third-party communications. Not only is this technically and economically impractical, it would require us to violate individual citizens' privacy rights."

Software companies deny that their

Warning signs of piracy 1 Increased file transfers. 2 Expanded directory trees. 3 Excessive data transfer in a single session. 4 Sites labeled with the terms warez, cracker, or hacker. 5 Posting of serial numbers used to install software. 6 Increased logging on to an area. 7 Many unusual or hidden files or directories. Source: Software Publishers Association

proposals would undermine any rights to privacy or free speech. They say they are simply trying to find a technological way of preventing worldwide piracy that costs their industry, which generates an estimated $16 billion in revenue each year, a startling $8 billion.

"All we are asking server operators to do is monitor traffic on their system. They do that anyway so it won't crash," said Sandy Sellers, vice president for intellectual property and law enforcement at the Software Publishers Association. "We're asking them to look for warning signs of piracy, not to monitor content."

Service providers say it's not that simple. For one thing, the treaty articles on the table in Geneva don't outline exactly when an online service or ISP would be held responsible for transmitting illicit material. And that would leave them vulnerable to wide interpretation of third-party liability.

"When this was discussed before Congress, we were negotiating under what circumstances there would be liability or no liability--adequate notice, reasonable action within reasonable time, etc.--but we were not able to reach a final compromise in time before the session ended," said Russ Kennedy, manager of government and industry relations for CompuServe. "There has been no discussion at WIPO about liability. There is no clarification other than a footnote that addresses that kind of issue."

Robert Massey, CompuServe president, CEO

Online privacy organizations say the whole notion of content oversight by service providers is misconceived. And they scoff at the suggestion that such supervision could take place without actually reading the material, thereby protecting the customers' rights to privacy.

"Who makes them a better set of people to evaluate content than anyone else?" said Lori Fena, executive director of the Electronic Frontier Foundation. She argues that software companies and law enforcement authorities should be addressing the source of the crime, not the messenger. "They should be going after the people actually doing the illegal transferring or copying, not the service providers."  

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