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June 11, 2002

Original: English



Name Steven Waldman
Organization Machinery For Change, Inc.
País United States

Proposal: Paragraphs 3(i) and 3(j) of section of the draft Agreement labeled “Relation to other Intellectual Property Agreements” should be amended. In particular, the following changes should be made:

(amend Paragraph 3)

[(i) [Articles 1 to 23 of the] Articles 1 to 17 and Articles 20 to 23 of the WIPO Performances and Phonograms Treaty, 1966 1996;]

[(j) [Articles 1 to 14 of the] Articles 1 to 10 and Articles 13 to 14 of the WIPO Copyright Treaty, 1996.]

These changes would exclude from the minimum IP-related requirements of FTAA the paragraphs in both WIPO treaties which relate to “Obligations concerning Technological Measures” and “Obligations concerning Rights Management Information”.

Rationale: These provisions were misguided in the original WIPO treaties. Including them by reference in FTAA would only compound the error. The WIPO treaties attempted, with astonishing prematurity, to give force of law to a technological approach to IPR protection known as “Digital Rights Management”. Digital Rights Management (DRM) is an attempt to counter a perceived technological threat (the ease of with which protected works can be reproduced and widely distributed when digitally encoded) with a technological quick-fix. Like most quick-fixes, DRM is fraught with unintended consequences that not only render the approach ineffective, but actively hostile to the purposes for which states establish intellectual property rights and protections.

Digital Rights Management represents a misguided and fundamentally bankrupt approach to protecting intellectual property rights. Some of the reasons why DRM is bad policy include:

  • DRM addresses the wrong problem;
  • DRM hinders the production of new creative works;
  • DRM distorts the marketplace for creative works, favoring wealthy incumbents over new creators;
  • WIPO-style protection of DRM effectively privatizes control over public policy with respect to IP;
  • DRM diminishes public access to factual information and political speech, and reduces the transparency of powerful institutions, both public and private, in which citizens must place their trust;
  • Alternative approaches to IPR protection exist which would better serve the purposes for which states establish intellectual property rights.

These concerns are expanded upon below.

DRM addresses the wrong problem. The rationale behind DRM identifies copying as the problem that intellectual property protection law must solve. This is misguided. IPR protections are provided by states not to control copying, but to i) ensure that creators are properly compensated for their labor and risk in producing creative works; ii) encourage the authorship of new works; and iii) encourage the public disclosure of creative work for the benefit of society at large. Control over reproduction has historically been one approach to meeting these goals, but the approach is a means to an end, not an end in iteself. The end is the compensation of authors. Wise policy would be concerned with the problem of securing compensation for use, rather than focusing anachronistically on preventing reproduction.

DRM hinders the production of new creative works. Digital technology promises to give voice to people and perspectives that thus far have been excluded from electronic mass media. Video production tools that a school in Brazil can afford today rival the equipment that high budget studios in Hollywood used only a few years ago. Audiovisual media are special. They are accessible to everyone; they affect us directly and deeply. In many countries, audiovisual media have become the most important venue both for cultural expression and democratic discourse. Nearly all audiovisual works, with the exception of very short films, incorporate some measure of preexisting material: background music, excepted bits from films or television, recorded sounds. This preexisting work is deservedly subject to intellectual property protection. Under current law and practice, authors of original new works may freely incorporate bits of older works, perhaps experimenting widely with many different bits and pieces as part of the creative process. The rights associated with the incorporated works are only implicated once a product has arisen from the chaos of creation, and the author wishes to widely distribute or commercially exploit the derived work. This is an appropriate regime ¾ the creative process is free and unfettered, while rightsholders to existing works are assured that they will be consulted and compensated when any comercially significant use occurs. DRM destroys this regime, by technological preventing the authors of new works from mixing and incorporating older works into their products.

DRM distorts the marketplace for creative works, favoring wealthy incumbents over new creators. DRM distorts the marketplace for new works in two ways: 1) it gives wealthy, legally adept entities an unmerited advantage during the process of creating new works; and 2) it creates a two-tiered system of protection, whereby entities that can afford to participate in the development of complex, costly, and legally sophisticated protection schemes are much better compensated for their creations than less established creators.

Under DRM, small creators, particularly of audiovisual works, would be unnecessarily disadvantaged, because they would be unable to incorporate preexisting protected works as part of the creative process. They might have production tools and talent that should enable them to compete with the best in the industry, but they would have access to a restricted range of creative inputs. Filmmakers at large studios, with special licenses and DRM-ignoring “professional-grade” equipment, could create freely, experimenting with all kinds of music, sounds, and images from older works. But newer creators would be restricted to generally available tools, which would refuse to allow a preexisting song to be mixed into the soundtrack of a film, or small bits of excerpted footage to be incorporated into a political documentary. Thus, DRM schemes give wealthy incumbents a serious advantage over upstart creators.

Once a new voice has managed to produce a perhaps brilliant new work, she is disadvantaged once again. The technologies of DRM are complex, and require constant updating as older schemes are cracked and circumvented. Under WIPO-style DRM, private companies develop these technologies, which then enjoy automatic legal protection. Compnaies won’t do this work out of the goodness of their hearts, however. In order to protect their own content, large rightsholders, individually or collectively, will pay to develop technologies to control access to their own work. It is unlikely, however, that these companies would be willing to permit nascent competitors who cannot afford to contribute significantly to the costs of DRM development to make use these expensive technologies. As the WIPO treaties envision delegating much of the enforcement of intellectual property rights to DRM technologies, small creators who cannot employ the technologies stand in effect to lose the protection owed to them by states.

WIPO-style protection of DRM effectively privatizes control over public policy with respect to IP. Intellectual property law and policy is a matter of balancing the rights and interests of various stakeholders. Creators, content aggregators and publishers, entertainment consumers, citizen-speakers, and the public-at-large all have legitimate interests that must be reconciled. The WIPO treaties, by giving legal protection to privately developed “technological measures”, without specifying or bounding the nature of those measures, gives the companies that craft such measures carte blanche to inscribe their own interests exclusively in DRM protections. Whatever the law might have to say with respect to the fair-use of material, or consumers’ rights to personal copies, or exceptions to intellectual property restrictions in a court room or policy debate, these are rendered moot by technological measures that are blithely unaware of such complexity. As technological measures are given the force of law, protected even (as WIPO envisions and United States’ DMCA enacts) from circumvention for legal and legitimate purposes, policy debate about balancing public and stakeholder interests is rendered moot. The technologies enforce what rightsholders program them to enforce, and under the WIPO treaties those technologies are the law.

DRM diminishes public access to factual information and political speech, and reduces the transparency of powerful institutions, both public and private, in which citizens must place their trust. Usually DRM technologies are discussed in the context of entertainment products: film, music, etc. But the threat that DRM poses to civil society, to the ability of citizens to engage in effective public discourse, is great. Just as digital production tools have the potential to open up creative work in audiovisual fields to new voices, so too do they make it possible for hitherto marginal political voices to present their points of view in the widely accessible electronic media that dominate mainstream discourse. However, activities like producing a documentary on a matter of public concern invariably require excerpting interviews, news footage, and other material from preexisting sources. Again, under DRM, established producers of news and political content will still be able to do all this, via licensing arrangements and exempted, “professional” production tools. But smaller documentarists will be unable to include documentary footage ¾ their astonishingly powerful but intentionally crippled equipment will simply refuse to do it.

There is an even deeper and more subtle effect that DRM schemes might have on civil society. More than at any other time in history, people in every nation must place their trust in distant, powerful institutions that affect each of our lives intimately. From government agencies, to banks, to Texas oil giants, malfeasance or incompetence within these magnifiers of human agency can cause catastrophic consequences for millions of people. Increasingly, societies have come to depend upon the notion of transparency to diminish the likelihood of large-scale social and economic catastrophes. Individuals who control the behavior and resources of powerful organizations must, at some level, know that they are under surveillance, that those whom their decisions affect will eventually know everything, and may call them to account should they do ill. The notion that “The truth shall out,” is what we all depend upon to check fraud and corruption by those who govern us, by those who hold our funds for us, those who produce our food, all the myriad institutions in which we must depend. Widespread use of DRM, encouraged by legal protection of those “technological measures”, makes it harder for unpleasant facts to escape to the public’s attention. Electronic transaction records that digital Xerox machines won’t copy make it difficult for whistleblowers to carry a “smoking gun” from the office to a judge or newspaper. Over the past century, we have seen the ability of a variety of large institutions to affect ordinary lives grow at the same time as communications technology has made information harder and harder to control. This simultaneity has not been coincidental. Concentrations of power without the check of public accountably are inherently unstable. DRM represents a technological attempt to reverse the trend, to put information under greater, rather than lesser, control. DRM might be intended primarily to protect music and films, but its general use will lead to a decline in the spread of factual information that the public requires to make “transparency” more than just a buzz-word.

Alternative approaches to IPR protection exist which would better serve the purposes for which states establish intellectual property rights. Proponents of DRM act as though the sky is falling, that the fact of perfect digital copies and a ubiquitous internet will eviscerate any ability to extract revenue from creative works unless something radical is done. However, most individuals who are purchasers and consumers of creative content today do not begrudge the money they spend on films, books, and music. The public is willing to pay. It is not copying or digital technology that threatens authors and other rightsholders. It is the failure of rightsholders to enable people to pay for creative works under new, unaccustomed terms. Wise policy for sustaining rewards and incentives for creators would focus not upon preventing copying, but on requiring compensation for use. If consumers were to pay rightsholders for the use of content, however they acquire it, then the fact that material can be distributed rapidly and widely presents a windfall rather than a threat. Governments should seek not to control reproduction, technologically or otherwise, but to devise rules and means under which consumers would compensate creators for the material that they use.

For example, one approach would be to establish “rights merchants”, from whom individuals could purchase a credential that establishes their right to certain uses of some song or film. Under this approach, government and industry, would collaborate to define standard sets of rights, that would be understandable and salable to the public. Consumers, creators, and public citizens would have unrestricted access to and use of protected works, however they obtain them, but would be responsible for paying for them. And governments would aggressively adopt a traditional enforcement role, prosecuting individuals who consistently fail to pay for material they make use of. Of course, governments would be unable to discover or prevent individual infractions without intruding in people’s lives to an unacceptable degree. But those who consistently flaunt their ethical and legal obligations to creators would be in jeopardy, and some would get caught and face painful consequences. If the cost of “going legit” is fair, if both access to the works and the process of payment is convenient, if governments establish a clear norm that compensating rightsholders is a serious obligation, most people will pay, most of the time.

Such an approach would encourage creators to disclose and distribute their work as widely as possible, consistent with the public-good foundations of intellectual property law. New authors would have full access to older works, and production tools that permit them to create freely. And consumers would be able to find creative works wherever they wish, in formats that permit them to organize and use those works as they please, in exchange for meeting their obligation to compensate creators.


Whether or not the Negotiating Group on Intellectual Property finds the above compelling in its details, I would ask that it at least admit that the case in favor of DRM is uncertain, and in no country or society where the issue has been widely discussed, has a consensus emerged among the general public supporting the approach. I therefore submit that the inclusion of DRM within international trade agreements is premature at best, as such agreements ought harmonize nations in matters of general consensus rather than engaging in experimental legislation. The fact that DRM protection was erroneously included in various WIPO treaties does not excuse FTAA negotiators from an obligation not to compound the error. I therefore respectfully submit that the amendments proposed at the beginning of this letter should be made to the draft WIPO agreement.

/s Steven Waldman


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