Did Japan And Korea Just Make Life Really Difficult For Any Cloud Service Provider?

from the does-the-length-of-the-wire-matter? dept

For a while we followed the important Cablevision remote DVR case, in which the entertainment industry argued that Cableivision offering a hosted DVR service for its users was infringing on their copyrights, even though DVRs are legal. The entertainment industry strained its credulity by arguing that because the DVR device was on Cablevision's property, rather than in someone's house (even though they functioned nearly identically), it completely changed the rules. They said that Cablevision required separate content licenses to offer such a service. Effectively, they were arguing that the length between the DVR and the TV determines whether or not there's infringement. That, of course, is ridiculous (though even more ridiculous was when they compared a DVR to murder).

Thankfully, the Second Court agreed and put forth a pretty good, if slightly awkward, ruling, which pointed out that it didn't matter where the device was, that time shifting is legal, and this service really seemed no different than a DVR. The entertainment industry (of course) appealed, but the Supreme Court refused to hear the case, so the law stands in the 2nd Circuit -- though with such a high profile case, one hopes that other Circuits would tend to defer to this ruling (though, they certainly don't have to).

Separately, we covered a very similar case in Singapore, involving RecordTV, which had trouble at the lower courts, but eventually came to a similar ruling as the US. In that case, the court even noted that allowing remote DVRs seems to provide benefits to society.

However, courts in other areas of the world apparently aren't quite as enlightened. Wonil Chung, an IP lawyer in Korea, recently sent over his excellent review of a number of similar cases from Korea and Japan where the rulings eventually all went the other way. The cases there all have their own specific details, but the general point was that the courts seemed to feel that if the equipment is housed and "owned" by the service provider, then the actions are done by the service provider... even if the end user is the one clicking the button. Effectively, those courts are saying that the length of the cable matters. Chung's analysis is balanced, and he notes that this can be a tricky issue. I agree that it's a complex issue that requires thinking through a variety of issues, but in the end, I have no problem saying that I believe the Korean and Japanese rulings defy common sense, while the US and Singapore rulings make sense.

Where it gets really important is understanding the wider implications of these rulings. Based on the rulings in Korea and Japan, it just became a lot more expensive and risky to set up any cloud-based service in either country. That's because these rulings effectively say that liability is determined by the location of the equipment, rather than the location of the user. Cloud-based services have the equipment hosted far away from the user. But does that really mean that the service providers have now taken on the liability? In Korea and Japan apparently the answer is yes, and that should put a chill through anyone building cloud-based offerings in either country.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
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    Anonymous Coward, Mar 17th, 2011 @ 1:41am

    Even for techdirt, coming to that conclusion on the final couple sentences is a stretch. These cases are all very narrow in what they deal with. Cable, or its equivalent in that country, also providing a DVR service. It has no implications on "the cloud", in all its generally vague and hard to define glory.

     

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    Not an Electronic Rodent (profile), Mar 17th, 2011 @ 1:49am

    perhaps....

    If you follow the "time shifting is legal" logic a bit further then it gets a bit odd to say "Well it's legal to watch that time-shifted TV show whenever you want, but this identical content you got from a bit torrent client is illegal". Looked at that way all the infringing content around becomes in and of itself legal and only becomes infringing at the point of use by someone who doesn't have the "rights" to consume it.

    Of course that would be totally unenforceable, so it's just a mental exercise but it does make a point about the arbitrary boundaries put on content. Technology has already destroyed the lines and the artificial boundaries are the Emperor's New Clothes.

     

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  3.  
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    Anonymous Coward, Mar 17th, 2011 @ 2:38am

    Well no surprises there, Japan laws are specially troublesome to anything in the cloud, there will be no billion dollar internet companies coming from there anytime soon.

    But the koreans and japanese don't mind because if there is no legal alternatives they always have the other ones that are not legal but very popular.

    Even after laws where passed criminalizing those options they still continue to be very popular there.

     

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  4.  
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    Mike Masnick (profile), Mar 17th, 2011 @ 2:40am

    Re:

    Even for techdirt, coming to that conclusion on the final couple sentences is a stretch. These cases are all very narrow in what they deal with. Cable, or its equivalent in that country, also providing a DVR service. It has no implications on "the cloud", in all its generally vague and hard to define glory

    Yes, these cases are narrow, because that's how cases work. But the underlying *REASONING* behind the rulings could easily apply to the cloud. If they say that hosting on premise makes you now responsible for the actions of your users, you're not paying attention if you don't think that'll later be used against remote storage or remote service operators.

     

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    Anonymous Coward, Mar 17th, 2011 @ 3:32am

    Blame shifting?

    The cases there all have their own specific details, but the general point was that the courts seemed to feel that if the equipment is housed and "owned" by the service provider, then the actions are done by the service provider... even if the end user is the one clicking the button.

    Hmm... So, if people in Korea and Japan use a remote desktop program to control a distant computer, they're not liable for anything done by that distant computer?

     

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    Not an Electronic Rodent (profile), Mar 17th, 2011 @ 3:38am

    Re: Re:

    Not as much effect I think as what happened to WikiLeaks on Amazon - now that to my mind makes you think twice about cloud services.

    It adds to the pile though and is another case of the legal framework of individual countries not coping with the implications of technology and putting an almost imaginary wrapper round it (or trying to put a real wrapper around something essentially imaginary perhaps).

    When you're talking about virtualisation and cloud just how do you determine jurisdiction? The natural reaction seems to be "Oh, well of course it's the country the server is in", except that can change minute to minute with current tech, possibly automatically in response to demand, load, time, or a host of other reasons. Or perhaps even running in all of them simultaneously, even more so if you're talking about a service rather than server. So location of the user then? Can be equally tricky to track through proxy or VPN.

    It always seems that laws end up being shoe-horned to fit, some seem to fairly well, others look like the ugly sister trying on the glass slipper. It makes me wonder if what's needed is for the "internet" to be created as almost a separate country in its own right with perhaps a committee-like "government" that creates a (light) regulation based on international agreement and compromise of what is "acceptable". Utopian perhaps and obviously fraught with complications and dangers, but the question remains how do you sensibly apply the rule of (at least some) law where you have no real sense of location? Or do you need to at all?

     

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    mike allen (profile), Mar 17th, 2011 @ 3:39am

    Of course the entertainment industry would love the courts to ban all DVRs whether cloud based or in the home. They could charge per view that way.

     

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  8.  
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    abc gum, Mar 17th, 2011 @ 5:53am

    Re:

    "These cases are all very narrow in what they deal with."

    These cases are all very narrow minded in what they deal with.
    FTFY

     

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    abc gum, Mar 17th, 2011 @ 5:59am

    The "entertainment" industry has nothing to fear from the cloud - the "dumbpipe" industry will kill it for them.

     

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    Anonymous Coward, Mar 17th, 2011 @ 7:04am

    My cloud platform (salesforce) has a data center in Japan. This ruling may actually cause that data center to move someplace else since the company becomes liable for what its clients do on its platform (and you can do a lot)

    I think as internet laws get more on the books we'll see a lot more data center tourism where places are picked based on local laws and political issues in that area. This will be a boom for anyplace with the right set of laws (say Triable land in the US) and downright destructive for country's that want to hyper regulate things like how long a cord is or the location of the machine doing the work.

     

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  11.  
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    Anonymous Coward, Mar 17th, 2011 @ 8:32am

    The Japan rulings seem to make sense to me, though I could have missed something since I just woke up...

    However, the reasoning in my head is thus:

    They are the ones essentially downloading/housing the content, not the end user that is requesting/watching that content.

    Essentially, think of YouTube. If they have copyright infringed material on their server, they're liable for it and need to remove it.

    Basically it comes down to whether or not the person storing that data has the rights for it or not. If not, they are indeed infringing on copyright.

    Having the rights to show it on television at a schedualed time does not grant the same rights to make it available to a user whenever they want, that is a separate set/clause in the agreement. Which leads me to point to HULU. If you ever notice the disclaimers on HULU, you can see that they say they do not have the rights to make it available on TV or Mobile devices. Same concept. It all depends on what they've been given rights for on that particular piece of content.

     

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  12.  
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    Anonymous Coward, Mar 17th, 2011 @ 8:34am

    Re:

    I think what you will see in the long run is that more and more countries will change their laws to stop data centers or service providers from knowingly providing service for these types of clients.

    Wise criminals have already gone down the process of trying to control all parts of a network to avoid prosecution and shutdown (please see Estdomains / Esthost and all that for more information). It is pretty reasonable to assume that criminal organizations will also "cloud" their activities in order to try to hide their actual operations. Owning your own cloud provider would make it even harder for people to find you out.

    When you create a crack in the system, law breakers will move in.

     

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    Chronno S. Trigger (profile), Mar 17th, 2011 @ 10:54am

    Re:

    It's legal for an end user to DVR a TV show, right? Then why does the location of the hard drive matter? It's not like the cable company is keeping all these files somewhere everyone can access, only the person who clicked the record button can view it. Each person is given, say, 100G of storage to record on. Why does it matter where that 100G is?

    This isn't about downloading, it's about recording live TV yourself.

     

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  14.  
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    Anonymous Coward, Mar 17th, 2011 @ 11:01am

    I don't understand why all Attorney Generals in this country aren't investigating Google for the Gaia breach in late 2009/early 2010.

    Here we have a massive company that holds a *lot* of citizens data, government data, and likely even military data, admitting to a breach of their core network, and no investigation is done to determine the scope of the breach? Why is there no investigation to determine the full extent of this breach? Or the other 100+ companies that are suspected of the same breach?

    Is not the nation's security at risk when such an important data repository is breached?

     

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  15.  
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    Anonymous Coward, Mar 17th, 2011 @ 11:46am

    Re: Re:

    Yeah, but many of these companies play games, like not storing more than 1 copy (even if 1000 people record it) or use the "record" feature as a way to just tap a single copy they create themselves.

    The location is important in part because it is adding a third party to the deal, which means the content is no longer in your control. Does the third party allow other people to use it / download it? Do they in turn create backups?

    There is plenty here that isn't cut and dry "fair use".

     

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    Anonymous Coward, Mar 17th, 2011 @ 1:52pm

    Dumb question, if I setup a simple webservice to upload content from my cable at home to amazon AWS have I broken the law in this case?

    AWS does not actually know what content is on their servers, you can also encrypt your content if you like when loading it. In fact you can even stream content back off AWS if you feel like it.

    Its almost trivial to set this service up now, my business already loads items onto AWS for streaming to our customers (self produced content in our situation).

     

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  17.  
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    Chargone (profile), Mar 17th, 2011 @ 3:43pm

    Re: Blame shifting?

    so it would seem.

    could be liable for something for the action of doing so if they didn't have apropriate permissions though.

     

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