Techdirt readers may recall that over three years ago, the UK's Digital Economy Act was passed in totally disgraceful circumstances. Since then, almost nothing has been heard about it, as British civil servants grapple with the fact that this poorly-drafted law is almost impossible to implement in any sensible way. If you were wondering what is going on behind the scenes, James Firth has put together a fascinating post piecing together the information that he was able to glean. The main point is that the UK's "three-strike" warning letters won't be going out for years:

Assuming a 2015 general election [in the UK], and factoring-in time to establish the necessary body or bodies to oversee the operation of the notification and appeals systems, it will be 2016 at the very earliest -- and possibly 2017 -- before the first warning letters go out.

In other words, it's likely to be six or seven years after the Digital Economy Act was passed that it starts to come into operation, if ever. What makes that particularly ridiculous, is that the pioneer of the three-strikes approach, France, is clearly backing away from it. For the UK to plough on with an outdated and discredited scheme regardless, is just farcical. But it gets worse:

Government advisers are aware that the creative industries are not currently on the point of extinction due to online copyright infringement, and are also aware of the concerns raised by ISPs and civil rights groups.

That is, the delay in implementing the law has meant that the claim that piracy would kill the UK copyright industries if left unchecked has been shown to be demonstrably false, removing what little justification there ever was for bringing in such disproportionate and vindictive legislation. Given that fact, and the evidence from France that three-strikes simply doesn't work, there is only one sensible option here: for the UK government to stop wasting the public's money and to repeal the entire misbegotten law immediately.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

At the end of May, we wrote about the Taiwanese government's bizarre proposal to create a copyright bill that was like SOPA, but even worse. Apparently, the folks at the Taiwan Intellectual Property Office (IPO) had slept through the whole SOPA thing. Thankfully, the Taiwanese quickly did their own version of the SOPA blackout, with Wikipedia Taiwan and Mozilla Taiwan set to participate. However, seeing the writing on the wall (and, perhaps, someone showed the IPO folks what happened in the US), and the proposal was abandoned before the protest was even needed.

Of course, it's not completely over:

In the face of these criticisms and the planned blackout, the Taiwan Intellectual Property Office abandoned this severe copyright law. In its announcement, the office stated that this plan would be “adjusted.” It’s clear that the government intends to introduce another copyright enforcement initiative in the future. Still, it’s enormously encouraging to see how users in Taiwan have organized to defend their rights and successfully stopped this draconian blacklist law.

The unfortunate reality is that many government authorities around the world still buy into the belief that the health of the Internet is acceptable collateral damage in this manufactured war on copyright infringement. Lawmakers need to understand that creativity and innovation can only thrive when our platforms remain open, where users are free to share and experiment with content. While it’s clear that the Taiwan Intellectual Property Office did not learn from the mistakes of SOPA and PIPA in the U.S., let’s hope others see the defeat of this latest copyright blacklist law and recognize that users will not put up with efforts to censor the Internet.

Still, it is good to see that whenever something SOPA-like pops up, the public quickly jumps up to protest it.

One of the problems with the debates around copyright and patents is that they too often assume that intellectual monopolies are necessary in order to promote innovation or even basic economic activity. But that overlooks all kinds of domains where that's not true. In the field of technology, free software and the other open movements based on sharing are familiar examples of this kind of thing. Less well known so are the so-called "informal economies" found in many parts of the world.

To its credit, WIPO has commissioned a report on this whole area, entitled "Conceptual study on innovation, intellectual property and the Informal economy" (pdf). Here's how it defines the informal economy (IE):

The most appropriate conceptualization of the IE is as a continuum from formal to informal, where different activities and actors occupy different points along this continuum. The transition from informal to formal status is gradual; single firms, households, and workers may carry out some activities informally and others formally at the same time.

Despite that vagueness, the informal economy is important for many countries:

Estimates suggest that over the past two decades, informal employment or employment in the IE made up more than half of non-agricultural employment in most middle- and low-income countries. Sub-Saharan Africa is the region with the largest estimates for the contribution of the informal sector to gross domestic product (GDP): the IE makes for nearly two-thirds of GDP including agriculture and half of non-agricultural gross value-added (GVA). It is followed by India, with around 50% of total GDP. Then come countries from the Middle East, North Africa and Latin America.

For Techdirt readers, the most interesting part of the report will probably the chapter that concerns the use of what it calls "Mechanisms to appropriate returns from innovation in the informal economy", including "formal appropriation" through intellectual monopolies -- or, rather, their absence:

On the one hand, it can be argued that the absence of formal appropriation and the work in clusters make up the strengths of the IE's innovation system. In this view, the innovation system in the IE largely rests on "collective learning experiences" based on low entry barriers and free flows of knowledge. The dynamics among similar enterprises in collective geospatial clusters determine rates of innovation, economic successes and the value of the cluster. Individual firms or economic units are not the key determinants of innovation and efficiency.

Appropriation efforts must also be considered in light of the social systems -- specifically family structures, community networks and commercial clusters -- within which the IE operates. Knowledge flows are characterized by trust, reputation, reliability, social and cultural signaling, and the willingness to pool resources and collaborate. This facilitates access to information, and critically reduces transaction costs.

Clearly, in this context, the notion of formal appropriation of ideas can be considered alien and inadequate in this IE context. As one study suggests, actors believe that formal IP based on exclusions and proprietary knowledge is not compatible with the knowledge diffusion and learning processes of the IE which are based on communities, clusters and the exchange of information.

Naturally, as a report commissioned by WIPO, the opposing viewpoint is also considered:

On the other hand, and in contradiction to the above view, it has been argued that the presence of perpetual copying and absence of appropriation mechanisms is seen as a barrier to scaling up innovative activity in the IE. Entrepreneurs are unable to develop their businesses beyond a certain stage as they lack exclusive rights to or control over their innovations. Therefore, they have fewer incentives to invest in machines or human capital (e.g., training new apprentices), and are unable to reach certain economies of scale.

Firms may also forgo the possibility to specialize in different styles and techniques, as copying is the norm. The absence of branding or certificates/labels, leading to anonymity of the sector's products in the eyes of consumers, is said to prevent producers of good quality products from being rewarded.

Due to this systematic effect, only small incremental improvements in processes and some incremental improvements or adaptation of products are likely to be achieved. Economic growth and productivity gains in the informal sector are hence below par. The IE might also have a negative influence on the formal sector. The reasoning behind this is that informal firms that fail to comply with various economic regulations or to meet their tax obligations are able to expand and take market share away from formal firms, even when they are less efficient overall. At worst, economists are concerned that informal firms may also undermine the incentives of formal sector firms to innovate, adopt new technologies, develop their IPRs or develop brands.

There seem to be a lot of assumptions in there -- for example, that those operating in the informal economy don't pay their taxes fully. That's conflating the black economy, where taxes are certainly dodged, with the informal economy, which is about how work is organized, not its compliance with the law. Similarly, the assertion that companies will give up innovating just because others don't try to patent everything they produce is contradicted by the experience of open source, which eschews patents, but has driven an accelerated pace of innovation in the world of proprietary software.

Despite these biases, the report is a valuable contribution to an area that has been largely overlooked until now. The more that WIPO and its world become cognizant of the very different nature of the informal economy, the better it will be for them -- and for future debates about patents and copyright.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

Augmented reality glasses are all the rage these days, because it's just not good enough to see the world through only our human eyes. We want enhanced vision, web connectivity, and complete access to our mobile lives with a blink of an eye. It's therefore no surprise that there are plenty of efforts out there to develop all kinds of AR glasses. Here are just a few examples.

• Have you been wondering what's inside Google Glass? A teardown of Google's AR glasses revealed: a proximity sensor, an ambient light sensor, a touchpad module, a TI OMAP4430 processor chip, 16GB of SanDisk flash, an Elpida mobile DRAM chip, a 2.1-Wh single-cell lithium polymer battery, a bone conduction speaker, a display with a native resolution of 640x360, a camera, an inertial sensor, a prism and other optical components. [url]
• Japanese researchers are developing AR glasses that can restore depth perception to people who are "binocularly challenged." They modified a pair of Vuzix Wrap 920AR 3-D glasses so that it would generate the impression of depth in the wearer's "good" eye via special software. [url]
• Korean researchers have created an electronic contact lens by mounting a light-emitting diode onto an off-the-shelf soft contact lens. Their ultimate goal is to develop contact lenses that have all the functions of a wearable computer like Google Glass, but still remain transparent and flexible. [url]

If you'd like to read more awesome and interesting stuff, check out this unrelated (but not entirely random!) Techdirt post via StumbleUpon.

One of the most important laws that has enabled innovation on the internet to thrive is Section 230 of the CDA. We've written about it many times. What it says is fairly basic: a website cannot be held liable for actions by its users. There are a few exceptions and caveats, but that's the basic premise. And it makes perfect common sense -- so much so that it's almost amazing that you need a law to say it. But, we do, because when grandstanding and moral panics come around, politicians and people with pitchforks love to blame third parties and intermediaries as if they're the problem. And, having intermediaries be liable for how users are using their services creates all sorts of problems. It makes it that much more difficult for companies to innovate, because they're taking on tremendous potential liability if anyone misuses their service. So, they then either don't develop an open service, or they have to invest heavily in services to filter/monitor/block any potential misdeeds (which also will lead to blocking legitimate uses as well).

Of course, the grandstanding politicians who jump on moral panics absolutely hate Section 230. They always have. As we've discussed in detail over the years, the type of politician that focuses on grandstanding on moral panics the most is always a state attorney general. They make grand public pronouncements against companies they don't like, often with absolutely no legal basis, and then browbeat them into a "settlement" just so the companies can stop having to deal with the AGs lying about them in public all the time. Chris Tolles, the CEO of Topix, gave a great detailed explanation of how various AGs ganged up on him, basically issuing a press release accusing him of doing horrible things, totally misrepresenting what the company did, but without naming a single law they violated (because they hadn't). In response, Tolles did what most people would think you should do in that case: explain to the AGs what Topix actually did, and why it was perfectly reasonable. In response, the AGs (more of them this time) issued another press release, taking direct statements that Tolles had told them further out of context, and making the company sound even worse. Eventually he "settled" because fighting them was costly.

We've seen this over and over and over again. AGs have attacked Twitter and Craigslist and Facebook and Comcast and Google and over and over again.

Of course, the lack of a legal basis often stymies these attempts, and a big thing that gets in the way: Section 230. So it should come as little surprise, as noted by Eric Goldman today, that the states Attorneys General are planning to ask Congress for an exemption to Section 230 when (you guessed it) states AGs bring a case. He heard it today while on a panel at the annual meeting of the National Association of Attorneys General, where he was on a panel about Section 230. During the discussion, Goldman says that an unnamed Attorney General (he didn't catch which one) made a comment about the plan.

Section 230 has been under attack for some time, but going to Congress to try to make that kind of exception would be a huge disaster. It would allow these AGs to continue with bogus grandstanding campaigns, but actually with the ability to create massive problems for companies actually trying to offer usable, open platforms for users. Nearly every company would need to proactively filter any kind of user generated content, and would be at risk of tremendous legal liability if "bad stuff" got through. This would be a huge attack on internet innovation, all so some ambitious politicians can try to make more headlines by attacking tech companies. The state Attorney General position is considered the classic "stepping stone" position, which many politicians use to run for Governor or Senator in their state, and one way to help with the campaign is to get lots of headlines around "protecting the children" and whatnot. So, basically, these politicians would be breaking one of the key elements that has allowed internet innovation to thrive, to help them get a few more headlines in their quest for higher office.

Google appears to be stepping it up a notch in trying to fight back against the claims that it is somehow opening up its system to the NSA or other law enforcement folks. As you now know well, one of the leaks from Ed Snowden a few weeks ago was about a system called PRISM, which is associated with how tech companies provide information to the federal government in response to FISA court orders. The initial reports, claiming that the NSA had full direct access to servers and could see what people were doing in real time, appear to have been extremely overblown, as it now seems clear that this was much more narrow. But there's still a big question of how narrow. Google sent an open letter to the DOJ, asking for permission to reveal basic numbers on how many FISA requests they receive and how many people have had information passed along to the government under the program. The government then gave "permission" in a way that actually further obfuscated things, only allowing the release of numbers when combined with all sorts of other government requests.

Now, Google has filed a lawsuit against the government, arguing that gag orders on FISA requests violate the First Amendment. The filing itself is an interesting read, in part for its first footnote:

Nothing in this Motion is intended to confirm or deny that Google has received any order or orders issued by this Court.

Of course, that might lead some to suggest that Google can't actually have standing, but there's an interesting legal argument here. Basically, Google is arguing that the perception that it's opened up its network to the NSA, as suggested in various reports, and which it cannot refute fully without revealing some details of FISA orders it has received, has caused it harm.

Google's reputation and business has been harmed by the false or misleading reports in the media, and Google's users are concerned by the allegations. Google must respond to such claims with more than generalities. Moreover, these are matters of significant weight and importance, and transparency is critical to advancing public debate in a thoughtful and democratic manner.

Given that, Google is seeking a declaratory judgment from the court that it has a First Amendment right to publish the total number of FISA requests it receives and the total number of users associated with those requests, though obviously not anything more. I'm sure the government will come back with all sorts of excuses as to why this is horrible, but it certainly presents an interesting legal challenge to the FISA court's gag orders.

In the wake of the NSA scandal leaks, there have been several examples of government officials and law enforcement coming out to state both that the program is necessary and that its existence ought never have been revealed. Those who espouse the latter often indicate that, as a result, Edward Snowden is some measure of a traitor, and in some cases so are members of the press that reported on the revelations. Not all former and current government folks are in that camp, of course, but those that are not typically argue the polar opposite: that the NSA program is either unconstitutional or unnecessary. Those are sentiments I happen to agree with, but there is a refreshingly original third course of thought.

That comes from NYPD police commissioner Ray Kelly, who has managed to blast the secret NSA program...but only for being secret.

“I don’t think it ever should have been made secret,” Kelly said yesterday, breaking ranks with other US law-enforcement officials. “I think the American public can accept the fact if you tell them that every time you pick up the phone, it’s going to be recorded and it goes to the government. I think the public can understand that. I see no reason why that program was placed in the secret category. Secondly, I think if you listen to Snowden, he indicates that there’s some sort of malfeasance, people . . . sitting around and watching the data. So I think the question is: What sort of oversight is there inside the [National Security Agency] to prevent that abuse, if it’s taking place?”

Now, the easy reaction to this is to write off Kelly's opinion that the majority of Americans would be okay with data surveillance as long as we were well informed about it. After all, stop and frisk is fairly above board, and people still hate it. But the point is an important one with real implications on how democracy is supposed to work versus how it actually does work in America today.

By that I mean whether secretive programs run by the government that impact the majority or all of Americans can be undertaken without the consent of the governed. Step back a moment from Kelly's assertion that the public would be on board with the program if we had known about it all along. Isn't the better point to be taken from his statement that we should at least have been given the opportunity to find out? As a member of a representative democracy, if my fellow Americans were indeed informed and signed off on this program, I have to accept it, whatever my dissenting views. If the government was above board on the checks and balances in the program, they might have a good PR case. But that process was never given a chance to incubate. Instead, broadly worded, vague legislation birthed secretive policies, subject to secretive committees and secretive courts, and it was only by the providence of a humanitarian leaker that the public had any inkling of what was going on. That isn't how the American concept is supposed to function.

And now we'll never know whether Kelly is right or not, because the experiment that could have occurred has been foiled. Any complacency by the public now can be written off as apathy born of anger and mistrust. Any dissent is tainted by the same as a result of the secrecy of the program. The method by which the NSA spy program was both initiated, continued, and finally revealed is almost a perfect counter example to the democratic process. I fear that our founding fathers, those men of the enlightenment so often referenced by the career politicians of the day, would be calling for revolution once more.

Marc Thiessen, a former speechwriter for President Bush, apparently really hates it when government overreach is exposed. We last mentioned him when he attacked Wikileaks in the aftermath of its publishing of various State Department cables. Now, with the new NSA surveillance scandal, he's back (of course) and taking the lovely position that it's perfectly fine to charge journalists who publish information about NSA surveillance with crimes.

Greenwald’s crime is violating 18 USC § 798, which makes it a criminal act to publish classified information revealing government cryptography or communications intelligence.

The law is absolutely clear. It states: “Whoever knowingly and willfully communicates, furnishes, transmits, or otherwise makes available to an unauthorized person, or publishes , or uses in any manner prejudicial to the safety or interest of the United States or for the benefit of any foreign government to the detriment of the United States any classified information— (1) concerning the nature, preparation, or use of any code, cipher, or cryptographic system of the United States or any foreign government; or (2) concerning the design, construction, use, maintenance, or repair of any device, apparatus, or appliance used or prepared or planned for use by the United States or any foreign government for cryptographic or communication intelligence purposes; or (3) concerning the communication intelligence activities of the United States or any foreign government; or (4) obtained by the processes of communication intelligence from the communications of any foreign government, knowing the same to have been obtained by such processes— Shall be fined under this title or imprisoned not more than ten years, or both.”

Of course, there's also that fancy First Amendment, which Thiessen would prefer to ignore:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.

It would appear that 18 USC 798 is exactly what is forbidden by the First Amendment. It is a law abridging the freedom of the press and freedom of speech. Defenders of Thiessen and the NSA will point out that there are lots of times the courts have said this is okay, but I'm not sure what kind of defense that is, other than nitpicking why the First Amendment is something to ignore. Personally, I think that the First Amendment is fairly important, and worry about any laws that appear to push back on the basic concept of it.

The US Chamber of Commerce, the giant lobbying organization who led the fight for SOPA/PIPA, is apparently so invested in "must have stronger copyright laws" that it doesn't even bother making sense any more. It's released a bizarre statement claiming that India needs stronger copyright laws, because Bollywood is so successful. Right upfront, it notes how successful things have been:

Boasting the largest film industry in the world, the creative sector lies at the heart of the Indian culture and economy. As one of India’s largest employment sectors, an endless array of local professionals from technical, theatrical, and creative backgrounds are helping churn out 1,000 films in more than 20 languages annually.

You'd think those are signs that copyright law was working (largest film industry in the world, largest employment sectors, over 1,000 films produced annually -- about double Hollywood) and that this would imply that whatever level of copyright there is in India -- which is supposed to be an incentive to creativity -- was doing a decent job. But, no, apparently it's all broken.

The government, however, must improve national intellectual property (IP) laws and enforcement if it is going to seize on this opportunity and gain recognition in the global market and further empower local creators.

Hmm. Wait, you just said that it's the world's largest film industry and an unqualified success. So, why does it need to improve those laws and enforcement?

Specifically, Indian copyright law is unclear with the 2012 Copyright Act amendments further complicating and contradicting previous rule of law. Furthermore, the 2012 Act provides for broad exceptions that are incompatible with international norms. Also measuring relatively loware enforcement efforts, which are weak in application and don’t provide widely available civil and procedural remedies for copyright infringement.

And, yet, this laxity incentivized the creation of nearly double the films that Hollywood produces. Perhaps -- and I'm just suggesting things here -- the "international norms" and the higher levels of enforcement are holding back the industries elsewhere. If anything, this report seems to suggest that other countries should move towards broad exceptions, since it appears to have been quite successful in India.

Furthermore, much of the paper seems to suggest that India needs to fix its copyright laws to embrace the international opportunity for its films -- but that (again) makes no sense. India's IP laws don't apply outside of India, so they have no impact on the international opportunities, which are governed by other IP laws. And, again, if the industry is doing great in India (with little enforcement and greater exceptions), doesn't this indicate that India should push for the same elsewhere to better embrace that international opportunity?

It's quite a world in which the US Chamber of Commerce seems to be arguing that an example of a success story should lead to that successful model emulating less successful markets. I don't know how much money the MPAA pays the US Chamber of Commerce for these kinds of pieces, but it's not getting its money's worth.

We recently mentioned that Senator Lindsey Graham said he was happy that the NSA was collecting the data on his calls, because he doesn't speak to terrorists. Of course, that's an incredibly ignorant statement in many, many ways. However, Senator Graham is continuing to make very silly statements about the NSA surveillance program. During an appearance on Meet the Press, Graham defended the program because, he explained, we should be tracking terrorists:

"I believe we should be listening to terrorists, known terrorist emails, following their emails and following their phone calls. And if they're emailing somebody and the United States or calling a number in the United States, I would like to get a judge's position to monitor that phone call," Graham said on "Meet the Press" on NBC. "If we don't do that, another attack on our homeland is very likely."

That's nice and all... but the things he discussed -- listening to terrorists, and getting info on their emails -- have nothing to do with the new programs that have been revealed. That kind of stuff was possible well before all of these new things came along. The NSA has long been able to do surveillance on such things. And, law enforcement has been able to go to a judge and get a wiretap order on phone calls. But that's not what has everyone concerned: it's the fact that this program collects data on everyone. It's not just collecting data on terrorists, and much of it doesn't require having to go to a judge to monitor specific information. Rather, broad collections of data are being pulled, so that the NSA can later go through them.

It's shameful that Senator Graham would so misrepresent what this debate is about. Either he doesn't understand it (which is horrifying) or he's deliberately misleading the public about it (which is worse).