The MPAA has probably been the worst of the various Big Copyright industries in terms of the level to which their studies exaggerate the negative impact of unauthorized copying, while totally ignoring any positive impact. For example, it likes to widely cite a study (which it paid for) that triple- and quadruple-counts "losses" by noting the ripple effects. At the same time, it totally ignores the same positive ripple effects (the ones that cancel out the negative ones, and may even outweigh them). Of course, a big part of this is the claim that an unauthorized copy is a "lost sale."

Now it appears that Macrovision, the big DRM company that supplies DRM to movie studios has cooked up its own study trying to support the MPAA in this argument, claiming that lots of people are copying DVDs and that most of them would buy the DVDs they copy otherwise. However, the LA Times' Jon Healey does an excellent job pointing out the many significant weaknesses in the study, starting, of course, with the fact that it was paid for by Macrovision, with a clear intent in the results. And while Macrovision hypes of the fact that many people in the survey said they would have bought the DVDs they copied, it ignores the fact that the majority of folks they spoke to said the DVDs they made copies of were ones they already legitimately owned.

Even then, the results really aren't as significant as Macrovision would like you (or, rather, Hollywood) to believe. As Healey notes, the study completely ignores the positive impacts of being able to make a copy of a DVD. In fact, the most common reason for making a copy was for perfectly legal time-shifting or back-up purposes from DVDs they legitimately own. In other words, being able able to make those copies is a valuable part of the DVD. Take that away and people will buy fewer DVDs because you've made them less valuable. But, of course, that doesn't show up anywhere in the results, because that's the last thing Macrovision wants people thinking about.

While the study also hypes up the fact that more TV shows are being copied via DVD, it ignores the fact that this is probably quite beneficial. Since TV shows are ongoing experiences, you want more viewers -- and if a copy of a DVD gets someone new hooked on the show, they're more likely to start watching it on TV or to buy a future DVD. But, again, that's not mentioned at all. Either way, props to Healey and the LA Times for digging into the numbers a bit and not just parroting the press release findings, like many other news sources.

The entertainment industry lobbyists are basically working ever possible angle to get more "control" over its content. We've already seen how they mess with the legislation process and the international treaty process, and now they're trying to use the FCC as well (not for the first time, either). The latest is that the MPAA is asking the FCC to remove certain restrictions that forbid it from blocking the recording of certain movies and from downgrading the ability to record certain movies. Basically, the MPAA is asking the FCC let it make use of "Selectable Output Control" to keep its rapidly disappearing "release windows" business model possible.

As you probably know, the movie business has worked for many years on the model of "release windows," where films first show up in theaters, then at special locations (hotels/airplanes), followed by video, then PPV, cable and finally network TV. This is a legacy of an old business model, where the studio had a lot more control over content -- but it makes less and less sense these days, in a world where people have a lot more options for their entertainment time and money. These "windows" have been shrinking, because that's exactly what the customers demand -- and it actually has worked out well for the studios, because with shorter windows they actually get more benefit from a single advertising campaign plus consumers are happier since they have more options about how they consume the content. But the industry is so focused on these windows, that when anyone dares to upset the norm, they freak out.

The latest situation is because the studios want to keep this totally unnecessary window process in place. So they're asking the FCC to let it either degrade recordings or block recordings of movies if they occur before the movies go to DVD/video rental. The MPAA reasoning behind this is pure bunk, claiming that it would encourage more people to buy HDTVs, speeding up the transition to digital TV. There are multiple inaccuracies in this claim by the studios. First, while HDTV's are digital, one does not need to upgrade to HDTV to switch to digital TV. More importantly, basically, the studios are pretending that it's someone else's fault that they're unwilling to put good HDTV content on TV. They're basically saying "oh, if you let us block copying, then we'll put much more good content on TV." That's hard to believe for a variety of reasons. There's plenty of demand for content on TV, and if the studios aren't willing to put on good content, then others are finding plenty of ways to fill in the gaps.

Furthermore, there's nothing stopping the studios from releasing movies earlier. Claiming that they need this extra copy protection is a myth. The copy protection won't actually stop copies from being made. "Professional" pirates will easily get around the protection schemes. The only people who won't are your average home family user, who the industry is trying to screw over by making them pay over and over again for the same content. Besides, even the FCC knows that the MPAA's argument is incorrect. In its own report, it stated:

"In particular, we are concerned that selectable output control would harm those 'early adopters' whose DTV equipment only has component analog inputs for high definition display, placing these consumers at risk of being completely shut off from the high-definition content they expect to receive."

In other words, for every person that "more HDTV content" encourages to upgrade, you're probably going to get more than one person pissed off that their DVR can't record that content. Hopefully the FCC tells the MPAA that its regulatory power isn't designed to let it prop up an obsolete business model.

This has been pointed out before, but never by an academic study: it turns out that many of the infringement notices that get sent by the big entertainment companies are based on incorrect information, often accusing perfectly legitimate content of being infringing. The study, by some professors at the University of Washington, proved that the notices are sent, rather haphazardly based on whether or not an IP address participates on a file sharing network -- and not whether or not it actually uploads or downloads any content. Specifically, these researchers set about to monitor file sharing networks themselves, and introduced a software agent that watched over what was happening -- but which did not actively upload or download anything itself. But what happened? The researchers received 400 notices claiming that their IP address had participated in unauthorized file sharing. Basically, as suspected, the industry watchdogs merely list out (easily faked) IP addresses, and use that as their entire body of evidence to file a claim.

So, while this isn't that surprising, it's even more proof of just how flimsy the RIAA/MPAA evidence is when they file these suits. Even worse, when this information is the basis of DMCA takedown notices, it's potentially a violation of the law -- as part of filing a DMCA takedown is swearing that you have proof that infringement occurred. The scary thing is that all of this has been pointed out to the industry before -- and yet the folks involved still seem to think that they are above the law. For all their moralizing about "pirates" not obeying the law, you would think that they would be careful about making sure they weren't breaking the law themselves. Apparently not.

Update: Realizing I left out the best part. In showing how the IP addresses can be easily faked, the researchers used the IP address of three laser printers who were then accused of "making available" unauthorized material. Somehow, I get the feeling this particular research paper is going to find its way into a variety of legal battles in the near future.

The MPAA has been aggressively suing websites that merely link to infringing content claiming that linking is "inducement" to infringe -- which appears to be an attempt to stretch the Supreme Court's Grokster decision beyond its intended meaning. However, when staring down the barrel of a big Hollywood Studio lawsuit, it's no surprise that some sites cave. The MPAA has happily announced that two more such lawsuits have been settled. These are actually consent judgments, meaning both sides agreement to the judgment, but also likely worked out a separate settlement. That way the MPAA gets to claim huge fines found in the judgment, but which the real settlement was probably much less.

As a bunch of you are submitting, at a panel discussion down in LA, an RIAA representative claimed not only was DRM not dead, but that it was making a comeback. However, the statements show a fundamental misunderstanding of what's happening in the marketplace. RIAA technology guy David Hughes made this statement:

"I made a list of the 22 ways to sell music, and 20 of them still require DRM."

Well, David, I just made a list of 22 ways to sell transportation mechanisms, and 20 of them still require a buggy whip -- but it doesn't mean anyone will buy them. Then, even worse was the statement from the MPAA's Fritz Attaway:

"We need DRM to show our customers the limits of the license they have entered into with us."

Well, there's your problem Fritz. The second you focus on how to limit your customers, you've lost them. No one wants to be limited these days. They want to be able to do what they want and they will reward those who allow them to do so. Treating your customers as people to be limited (i.e., people who you offer less value to) pretty much guarantees that they'll go elsewhere.

Just as IsoHunt is gearing up to fight its MPAA lawsuit, a judge has ordered TorrentSpy to pay $110 million to the MPAA in a similar lawsuit. However, despite the MPAA's Dan Glickman giving the expected "this is a warning to other such sites" quote, this actually shouldn't have much of an impact on other such cases -- as the details are somewhat different here. The problem with TorrentSpy's case was that the company was found to have destroyed evidence, which resulted in the ruling. It had little to do with the actual issues at hand. And, yes, while the "destroyed evidence" claim was somewhat exaggerated when the judge included TorrentSpy's refusal to spy on its users, the destruction of evidence went further than just not spying on users. The company was found to have deleted specific evidence, including forum posts and directory info. So, unless all the other torrent search engines out there also deleted evidence, it's hard to see how this case acts as a warning to anyone over anything other than the stupidity of destroying evidence. As for getting any money, given that TorrentSpy has shut down, the MPAA probably won't be getting any money -- not that they'd be giving it to moviemakers anyway.

The MPAA really is somewhat dense sometimes, isn't it? Despite the fact that every time it sues some website for linking to unauthorized content, that site ends up with a ton more traffic, the MPAA keeps on suing. These lawsuits don't slow the pace of unauthorized sharing one bit, but they do generate a ton of publicity for the activity the MPAA thinks it's "cracking down" on. The latest is Pullmylink.com. It's a site I've never heard of, but thanks to a brand new lawsuit from the MPAA, plenty of people are learning all about the site. Even worse, like some of its ilk, Pullmylink appears not to actually host any infringing content. It merely links to it -- which makes the claims of copyright infringement even more questionable. Surprisingly, even the Reuters report notes how questionable this is, quoting people pointing out that making linking illegal has all sorts of unintended consequences. In the meantime, the folks at Pullmylink should be happy. They're about to get a ton more traffic.

The saga between TorrentSpy and MPAA will certainly be declared a "win" (if not a "significant blow") by the MPAA, but it's really more of a sad statement on the way the entertainment industry goes about its business. TorrentSpy announced earlier this week that it was shutting down and giving up, not due to any court order, but mainly because it was sick of the whole process and it didn't seem likely that the judge was going to see its side of the story. If you recall, TorrentSpy lost its case, but not on the copyright claim. Instead it was based on TorrentSpy potentially having destroyed some important evidence. It does look like the company (stupidly) did destroy some evidence, though some of the "destroyed evidence" was TorrentSpy's refusal to keep log files on its users, something it felt would be a violation of its own privacy policy. Based on the destruction of evidence problem, it's not too surprising that the company shut down -- but there really was no ruling at all on the more important question of whether or not simply operating a search engine counts as "inducement." This case also highlighted some of the MPAA's more unethical moves, including having someone hack into TorrentSpy's email servers and forward internal emails to the MPAA. So, while the MPAA will surely declare victory, all the case actually showed was (a) how unethical the MPAA can be (b) that it was able to shut down a site with owners who stupidly destroyed evidence and (c) that no ruling was made on the actual claims concerning copyright.

Officials in Antigua are now trying to draw a line in the sand, claiming that if the US doesn't finally agree to allow some forms of online gambling by the end of this month, it will go ahead with its threats to ignore US copyrights with the approval of the WTO. As you may recall, back in December, the WTO granted Antigua that right, after a loooooooong series of battles with the US over whether or not the US was violating free trade agreements by banning online gambling. Of course, every time the WTO sided with Antigua, the US would stall, claim the WTO sided with the US (when it clearly did not) and (my personal favorite) claim that even if it had broken trade agreements, it didn't matter any more because the US was unilaterally changing its trade agreements so that it was no longer violating them.

Of course, when Antigua won the final decision in December, allowing the country to ignore US intellectual property rights, the US government and the entertainment industry quickly warned Antigua not to follow through on those plans -- but the US government still won't shift in its position on the matter. Thus, Antigua is agitating to get this show on the road. While it first needs to get one last permission slip from the WTO, once that's in place, it can start ignoring the copyright on American movies and music. Of course, while some are suggesting that it may make sense for The Pirate Bay to move to Antigua, that's not accurate. After all, the WTO has said that Antigua can only violate $21 million worth of intellectual property, and with the way the entertainment industry counts damages, that's like half an album or so.

In fact, that seems to be exactly the angle that the entertainment industry is taking in this fight. An MPAA letter warning: "The proposed retaliation would be impossible to manage. The real and resulting economic harm would vastly exceed any amount the (WTO) might approve, even the grossly exaggerated amount ($3.4 billion) for which Antigua seeks approval, plus the economic harm would extend to other WTO members."

It's no secret that the entertainment industry has some execs who are positively proud of the fact that they'll sacrifice long-term strategy for short-term gains, but you'd hope that there was someone, somewhere with a powerful position in the industry who would point out why that's not a particularly intelligent strategy. Take, for example, the MPAA's position on net neutrality. Last summer, the MPAA sent a letter to the FCC opposing net neutrality on the grounds that it would hinder its anti-piracy efforts. It would appear that the MPAA is getting more vocal about this, as MPAA boss Dan Glickman repeated the charges yet again that net neutrality would harm its business.

Of course, the only way that's actually true is if the MPAA views the internet as mostly being about piracy, rather than a future distribution channel. Because, as Jon Healy points out in the link above, in a non-neutral internet, where ISPs get to charge extra to heavy bandwidth users, the movie studios are suddenly going to find that it's a lot more expensive to distribute movies (extremely high bandwidth items) online, since that will be exactly what the tollbooths are set up for. So, in coming out against net neutrality, the MPAA is basically saying that it wants distribution costs online to be higher. Perhaps it's no surprise. The industry really doesn't want to embrace the online world, as is quite evident from its repeated half-assed efforts at creating online movie download services. Perhaps Glickman and the studio bosses really believe that they can go back to a world where only the studios control the distribution mechanisms, even if they're a lot more expensive, cumbersome and inefficient. It does seem odd, though, that any business would prefer that its distribution systems be more expensive and less useful -- but that just goes to show you the level of strategic thinking that sometimes goes on in Hollywood.