Nearly two years ago, Spotify first hinted at its desire to set itself up as a platform that others could build things on top of. And it's finally become a reality. This could actually be quite cool. Just a couple months ago, we were pointing out that just "putting radio on the internet" isn't that cool, but that we need killer apps for music. Spotify as a platform will hopefully make it easier for those killer apps to happen. The current crop of apps that they launched with are pretty ordinary, but I'm excited to think what comes next. Things I'd love to see: Turntable.fm (still the most addictive and coolest "social music" service out there) integrated directly into Spotify) as well as integration with things like TopSpin or Bandcamp. Right now there are options to do ticketsales, but what if you could build in ways to let people buy merch... or, better yet, connect with the artist directly via Spotify? And those are the obvious ones. The real killer app is probably going to take us all entirely by surprise. This is, by the way, yet another reason that short-sighted artists and labels are going to regret dropping out of Spotify. You have to be where the killer apps are or you're going to get left behind.

The human brain is a remarkable organ, but we've only really just started to study it. Scientists are scanning brains with intense magnetic fields and zapping skulls with electrical pulses -- and measuring some differences that could point to ways that'll help people understand how our minds work. Here are just a few examples of projects focused on our brains.

• Measuring IQ with MRI scans suggests that IQ scores might fluctuate quite a bit. Various mental and physical training tasks can apparently boost IQ scores, and conversely, folks with jobs that don't require much mental exercise seem to lose IQ points over their lifetime. [url]
• Targeted electrical pulses into the brains of mice (aka deep brain stimulation) have been shown to improve their spatial learning ability. Actual "thinking caps" might be useful tools someday. [url]
• The young brains of frequent video gamers might grow differently than non-gamers' brains. Further studies could help us understand the development of addictive behaviors -- or it could help make really, really awesome video games. [url]
• To discover more interesting articles on the human mind, check out what's currently floating around the StumbleUpon universe. [url]  

By the way, StumbleUpon can recommend some good Techdirt articles, too.

Well, Facebook no longer needs to be the scapegoat when it comes to harvesting your personal information and doing nefarious things with it. Now, thanks to the House of Representatives, you can look forward to "a broad swath of ISPs and other private entities" collecting your personal data and sharing it with "the government, other businesses, or "any other entity" so long as it's for a vaguely-defined "cybersecurity purpose."

This is yet another governmental attempt to harvest personal internet usage data in hopes of somehow preventing something bad from happening in the future, all under the pretense of being hip deep in a "cyberwar." If you're looking to see who's spearheading this new attempt to rifle through your internet drawers, look no further than the bipartisan team of Committee Chairman Mike Rogers and ranking member Dutch Ruppersberger.

And they're working with un-Representative-like speed. EFF posted this information on November 30th and they are already trying to move it out of committee today (December 1st). If someone is trying to push something through posthaste, generally speaking, it's a terrible bit of legislation that would raise all sorts of objections if left out in the sunlight for any length of time.

As it's written, this bill would "trump existing privacy statutes that strictly limit the interception and disclosure of your private communications data, as well as any other state or federal law that might get in the way," even opening the door for spyware installation. (For your own protection, of course.)

The bad news gets worse:

This broad data-sharing between companies wouldn't be subject to any oversight or transparency measures (users can't restrict companies' sharing), while the only oversight for sharing with the federal government, ironically, would be through the Privacy and Civil Liberties Oversight Board-which hasn't existed since January 2008.

Worse yet, the bill doesn't limit what the federal government can do with the data or private communications that ISPs and others hand over, except to say that it can't be used for "regulatory" purposes-apparently it can be used for law enforcement and intelligence targeting purposes.

Perhaps at the top of the list is concern over the fact that the bill allows information sharing with any federal agency-including the National Security Agency (NSA)-thereby threatening civilian control of domestic cybersecurity efforts.

This privacy-trampling rush job follows on the heels of another bill, rushed through the Senate on the Monday following the Thanksgiving weekend. This one concerns itself with terrorism, or at least uses it as an excuse. The National Defense Authorization Act seeks to bring the war on terror back to the homefront:

The Senate is going to vote on whether Congress will give this president-and every future president - the power to order the military to pick up and imprison without charge or trial civilians anywhere in the world. Even Rep. Ron Paul raised his concerns about the NDAA detention provisions during last night's Republican debate. The power is so broad that even U.S. citizens could be swept up by the military and the military could be used far from any battlefield, even within the United States itself.

Redefining the battlefield in order to use the military as a police force is generally the sort of thing totalitarian nations do, not nations that continue to tout a never-ending "War on Terrorism" as an essential part of securing our "freedom." This bill will now allow American citizens to join in on the "fun" that was previously only available to foreign arrestees:

The worldwide indefinite detention without charge or trial provision is in S. 1867, the National Defense Authorization Act bill, which will be on the Senate floor on Monday.

Now, whatever rights Americans might have had (like say, a speedy trial or the right to confront their accusers) are being removed and replaced with the "right" to sit in a detention center for the rest of whatever without ever being charged with a crime. Once again, a bipartisan team (Sens. Carl Levin and John McCain) put aside their political differences to draft the bill in secret and pass it in a closed committee without a single hearing.

Sen. Mark Udall tried to pass an amendment which would remove "the harmful provisions and replace them with a requirement for an orderly Congressional review of detention power" but was shot down 61-37. Rand Paul went toe-to-toe with McCain, pointing out the audacious sweep of this bill:

"Should we err today and remove some of the most important checks on state power in the name of fighting terrorism, well then the terrorists have won," Paul argued, "[D]etaining American citizens without a court trial is not American."

McCain responded by fashioning a pair of blinders out of the American flag and (as Reason puts it so well) "puking up a rainbow of pro-America, pro-democracy, anti-terrorist drivel in response to Paul's very direct question":

"Facts are stubborn things," McCain repeated from the floor several times. "If the senator from Kentucky wants to have a situation prevail where people who are released go back in to the fight to kill Americans, he is entitled to his opinion."

And that is how you rationalize "indefinite detention": without it, Americans will die.

In case anyone out there is getting ready to argue that this bill doesn't target Americans, the ACLU has an answer for you:

There is an exemption for American citizens from the mandatory detention requirement (section 1032 of the bill), but no exemption for American citizens from the authorization to use the military to indefinitely detain people without charge or trial (section 1031 of the bill). So, the result is that, under the bill, the military has the power to indefinitely imprison American citizens, but it does not have to use its power unless ordered to do so.

All it takes is the order, and that's the whole point of the bill: to grant the President that specific power. And if you don't believe the ACLU's take, just read what one of the bill's sponsors, Sen. Lindsey Graham said about it on the Senate floor:

"1031, the statement of authority to detain, does apply to American citizens and it designates the world as the battlefield, including the homeland."

Ah, the "homeland." You'd think that the people drafting bills like this would avoid using a term that conjures up images of dictators turning on their own citizens in order to maintain their power. But, if we've learned nothing else from the past decade, it's that our representatives in Washington clearly don't care what the public thinks. After all, we're just a bunch of suspects.

While the MPAA has been pretending that there are no alternatives beyond the insanity that is PIPA and SOPA, some in Congress have actually been hard at work on trying to think through the specific issues. And one key point has become clear: this isn't a law and order issue, but an international trade issue. Nearly all of the complaints are about the problem of "foreign" sites sending goods across the border into the US. So it makes absolutely no sense that this issue isn't under the purview of the Finance Committee, whose job it is to oversee international trade. Thus, a bill is being worked on that tackles the issues as an international trade issue. A "discussion draft" is being circulated on this (embedded below).

This new effort has bipartisan support in both the House and the Senate, and unlike SOPA and PIPA, seeks to try to focus in on situations that are actually problematic. In the Senate, it has the backing of Senators Cantwell, Moran, Paul, Warner and Wyden. All of whom had come out against PIPA, except for Warner. Adding him to this issue is big, given his experience in the business world. On the House side, it's Reps. Chaffetz, Campbell, Doggett, Eshoo, Issa and Lofgren. The focus would be putting the issue into the International Trade Commission, where there are experts focused on trade issues.

I think this is an approach that absolutely makes sense for counterfeit physical goods and the websites that sell them. Frankly, it's bizarre that it ever went beyond a discussion of international trade. It becomes somewhat trickier with copyright issues, and that's because you now have questions about how physical borders apply to digital networks. And I'm not sure I know how to best deal with that. Separately, having seen the ITC process on patents go off the rails at times, and become more of a way for patent holders to issue a "double whack" against a company they accuse of infringement, I'd be concerned about making sure that this process doesn't allow for two bites at the same apple. If it's properly focused on just foreign sites, that might not be as big an issue.

Either way, the devil will be in the details, but the details are still being written. Seeing as this is a discussion draft, I'm hearing that the folks involved really do want a discussion (unlike what we got with SOPA/PIPA), and that includes folks here. Take a look at the draft, and weigh in, knowing that some of the folks involved really will be reading what you have to say.

Rep. Lamar Smith, who introduced SOPA in the House, has now taken to the pages of the National Review to defend the bill... and yet he does so in a way that makes almost no sense at all. Frankly, some of it makes me wonder if he even recognizes what's in his own bill... and what existing law is. Let's dig in to some of it:

Claims that the Stop Online Piracy Act will censor legal activity on the Internet are blatantly false. Enforcing the law against criminals is not censorship.

Sigh. Not this again. Look: no one is saying enforcing the law against criminals is the problem. The concern is enforcing it against protected speech (i.e., not infringing speech). And even SOPA supporters' lawyer of choice, Floyd Abrams, has admitted that SOPA would block protected speech (just not enough to concern him). But, more to the point, it undoubtedly is censorship. Law professor Derek Bambauer has pointed out that any blocking of speech is censorship -- and that our society agrees that some forms of censorship are actually okay. The question is whether or not we agree that this form of censorship is okay.

The Stop Online Piracy Act specifically targets websites dedicated to illegal and infringing activity. Often based overseas, these websites are called “rogue sites” because they flout U.S. law and face zero legal consequences for their criminal activity. Rogue sites not only steal America’s products and profits; they steal jobs that rightly belong here at home. This bill cuts off the flow of revenue to rogue sites by preventing criminals from selling and distributing counterfeit products to U.S. consumers.

Fluff and rhetoric with almost no basis, for the most part. First, the problem many of us have is that the definitions are super broad and do not "specifically target websites dedicated to illegal and infringing activity." The definitions allow for much broader attacks. As for the so-called "rogue sites," many of them do face legal consequences at home (witness Swedish prosecution against the Pirate Bay, lawsuits against RapidShare, MegaUpload and others -- all three of which have been called rogue sites by supporters of this bill). Claiming they face no legal consequences is blatantly false. Furthermore, they all face significant business consequences. If they're consistently bad actors, that limits their ability to build a significant business. The final sentence reverts to "counterfeit products." Of course, just yesterday we went through SOPA supporters' own numbers on this and showed that the issue of counterfeit products is miniscule. The problem is when they lump in dealing with the narrow problem of counterfeit products with a very different issue: copyright infringement. Let's deal with the two problems separately. (Also, how do you "steal profits" and "steal jobs"? That's meaningless political rhetoric.)

The bill defines rogue sites as websites that are dedicated to the facilitation of the illegal sale and distribution of counterfeit or pirated goods. Websites like Facebook and YouTube that host user content are not “dedicated to” illegal activity and they certainly do not make a business out of “facilitating” the illegal sale and distribution of counterfeit or pirated goods. But if a user posts illegal content on a website like Facebook or YouTube, current law allows rights holders to notify the website to remove the illegal content.

I'm sure Smith wants to believe this is true. But, it's not. It's proven false by the fact that Viacom is already suing YouTube for a billion dollars. If SOPA had been in place in 2007, you can bet that Viacom would have used the provisions in SOPA to kill off all YouTube revenue first, rather than filing DMCAs and then suing. Viacom clearly believes that YouTube is (or at least was) "dedicated to illegal activity." And since Smith's own bill allows for this private right of action, it doesn't matter whether he really believes it will be used this way or not... all we need to know is how companies will use it, and we've got a long history under the DMCA to see that tools like this will absolutely be abused to shut down competitors and innovative threats.

The Stop Online Piracy Act is a constitutional bill that protects free speech and America’s intellectual property. The First Amendment is not an excuse for illegal activity. Simply because the illegal activity occurs online does not mean that it is protected speech. Like online piracy, child pornography is a billion-dollar business operated online. It is also illegal. That’s why law enforcement officials are authorized to block access to child-porn sites.

And this paragraph is the most problematic of all. First of all, we won't know if it's really "constitutional" until a court determines that. Many constitutional scholars have their doubts. Second, no one claimed that the First Amendment is an excuse for illegal activity. As we explained above, the issue is the collateral damage. Put forth a bill that narrowly focuses on actually infringing works, and this isn't a problem. Here, however, it's much broader. And, again, even the one constitutional lawyer defending SOPA (as part of his work for the MPAA), has admitted that, contrary to Smith's own claims, SOPA "may result in the blockage of some protected speech." Pretending this is an impossibility even when your most ardent supporter admits it... is weak.

But the bigger problem is bringing child porn into this. Smith claims that "law enforcement officials are authorized to block access to child-porn sites." That struck me as an odd statement, because the lawsuit I remember concerning that issue actually said that such a clause in a bill violated both the First Amendment and the Commerce clause. This left me scratching my head, so I emailed a bunch of internet lawyers... and no one was aware of any laws that said law enforcement could just block access to child porn sites. There could be criminal trials that lead to sites getting taken down, but no one knew of legal process that allowed requiring others to block access.

Is there a secret law? Is Lamar Smith making things up?

More to the point, copyright infringement and child porn are very different crimes. Child porn is a felony. Copyright infringement, in most cases, is a civil offense. Yes, in some cases it can be criminal, but SOPA doesn't just apply to criminal infringement. Punishment for the two should be quite different.

Similarly, this bill authorizes the attorney general to seek an injunction against a foreign website that is dedicated to illegal and infringing activity. The attorney general must go to a federal judge and lay out the case against the site. If the judge agrees, a court order will be issued that authorizes the Justice Department to request that the site be blocked.

Notice what Smith conveniently leaves out: in many cases under the bill (not all), they will go before a judge without the other side appearing.

According to estimates, IP theft costs the U.S. economy more than $100 billion annually and results in the loss of thousands of American jobs.

And according to analysis by the US Government Accountability Office, those estimates are complete bunk.

Congress cannot stand by and do nothing while some of America’s most profitable and productive industries are under attack.

The industries aren't under attack. The business models of a few legacy players are under attack. Let's be clear: there is more content (music, movies, books, video games, etc.) being produced today than ever before. There is more money flowing into these industries as a whole. People continue to spend and purchase these goods all the time. The attack is merely on a gatekeeper business model that focuses on trying to set up artificial scarcity.

Unfortunately, there are some critics of this legislation who are not serious about helping to protect America’s intellectual property. That’s because they’ve made large profits by working with and promoting rogue sites to U.S. consumers.

That claim keeps coming up without any evidence at all. It's hard to believe Google profits much at all from infringement. Almost no one is clicking on Google ads on these websites, and Google only makes money if people click.

Google recently paid a half billion dollars to settle a criminal case because of the search-engine giant’s active promotion of rogue foreign pharmacies that sold counterfeit and illegal drugs to U.S. patients.

Totally misleading and irrelevant. That was a case of sites directly advertising via Google. No one has claimed that any of the rogue sites targeted by SOPA are buying ads on Google. This is nothing more the mud-flinging against one company (of many) that are against this bill.

While there's still a fight over whether or not SOPA and PIPA will pass, it seems that people are already working up basic hacks to make the laws obsolete, should they pass. The folks behind MAFIAAFire, the browser plugin designed to route around ICE seizures has created a new offering, dreadfully named "The Pirate Bay Dancing," which will route around any DNS or IP blocking by using a rotating list of proxy servers. If you thought that ICE was upset about MAFIAAFire, you'd have to imagine they won't be at all pleased about this bit of code. Of course, SOPA does have an anti-circumvention clause in there, which would effectively make this plugin illegal. Of course, I can't see how they could possibly enforce something like that. Using a proxy in general is legal. How will they know if you're using a proxy to get around these particular blocks? Either way, it's yet another example of why the MPAA's insistence that DNS blocking remain in the bill shows (yet again) how technically clueless they are. DNS blocking is a total waste of time. It makes the internet less secure. It fragments key pieces of the internet. Breaks the basic agreement of how the internet is supposed to work... And all for what? To create a system that won't actually block much at all?

Remember Carrier IQ? This was the company whose software was installed on a ton of phones out there (mainly from Verizon and Sprint), supposedly to record things like if there are dropped calls or problems or whatnot, but which actually appeared to be a rootkit that could track all sorts of info? Then, remember how, rather than respond professionally to this, Carrier IQ threatened researcher Trevor Eckhart with a copyright lawsuit over this? CarrierIQ eventually backed down... and again insisted that the claims of keystroke logging were simply not true.

Yeah. So. Don't piss off a security researcher. Eckhart is back with a video showing how CarrierIQ's software does track keystrokes and sends them to a central server. He demonstrates it recording and sending data, even though Eckhart is logging into something using HTTPS. Of course, when the software is local and tracking keystrokes, HTTPS is meaningless. Dave Kravets at Wired highlights what's really scary about all of this:

By the way, it cannot be turned off without rooting the phone and replacing the operating system. And even if you stop paying for wireless service from your carrier and decide to just use Wi-Fi, your device still reports to Carrier IQ.

It’s not even clear what privacy policy covers this. Is it Carrier IQ’s, your carrier’s or your phone manufacturer’s? And, perhaps, most important, is sending your communications to Carrier IQ a violation of the federal government’s ban on wiretapping?

And even more obvious, Eckhart wonders why aren’t mobile-phone customers informed of this rootkit and given a way to opt out?

I would imagine that lawyers are furiously drawing up a pretty massive class action lawsuit as we speak (if it hasn't already been filed).

We've pointed out over and over again that the real way to stop infringement is to offer compelling legitimate services that are reasonably priced. Time and time again, throughout history, it's been shown that the real reason there's widespread piracy is because the content isn't available legally at all, or is available in a limited or inconvenient way. Make things easy, not locked down, convenient and reasonably priced, and tons of people pay. Books have been written about this. Studies have been done on this. And just the success of things like Netflix and Spotify show how this works wonders.

Now there's a new study, once again, showing the same thing. Professors Michael D. Smith and Rahul Telang (from Carnegie Mellon and Heinz College) have added some more evidence -- and it again suggests the "problem" isn't that the law isn't strong enough or that enforcement isn't draconian enough. It's that the industry still refuses to give customers what they want:

Our research suggests that Hollywood is leaving money on the table — and is in turn failing to address a root cause of piracy — by preserving its separate release windows. Based on our analysis of seven large nations, we find that in most countries, every week customers have to wait before they can buy a DVD translates into, on average, 1.8 percent lower DVD sales. Given that good-quality pirated versions are available close to 14 weeks before the legal versions, the losses can be in the millions of dollars. Not surprisingly, a 14-week delay also translates to a 70 percent increase in pirated movie downloads in those countries.

The study basically found what many of us have been pointing out for ages: making things not available doesn't drive sales. It drives infringement. This is such a fundamental point, and it seems so obvious to many of us... but those in the industry still refuse to believe it. Now, some of the problem with the delays come from the theater owners, who flip out at any attempt to shorten windows, even if the "competing" options are priced ridiculously high.

But the studios themselves are frequently guilty of this same self-defeating thinking. Many are really pushing for rental delay windows, such as denying new movies to Netflix or Redbox until 28-days after they go on sale. One studio has broken ranks here: Paramount. That's the only studio that has made it clear that delaying movies doesn't increase sales. The other studios, though, still don't seem to get it, and don't realize that for people who want to see a movie, but are stymied due to a stupid release window, that they do have a few other options: (1) simply go away and forget the content entirely or (2) go find the content elsewhere. Neither scenario is good for the studios.

But the professors make the key point that the studios are going about this entirely backwards based on the data:

Together these results suggest that delaying content in the presence of digital channels is likely to cause consumers to lose interest in the product at best, and lead consumers to alternate pirated channels at worst. A better strategy would be to do the opposite: Make it easier for consumers to buy the content in physical and electronic channels. For motion picture studios this might mean selling content in theaters, on DVD and on digital services at around the same time, perhaps at different price points.

Shocking. We've only been arguing for many years that you should be able to buy the DVD of the movie you just watched as you walk out of the theater (and if you show the ticket, you get a discount). It still amazes me that this is still not really being done -- even as the evidence piles up that moves like that would increase, not decrease revenue.

In the discussion following my recent post about ex-RIAA boss Hilary Rosen's comments about my article highlighting all of the problems with SOPA and PIPA, Ms. Rosen was kind enough to stop by and attempt to clarify her position:

...my response was "Think analog" not as in analog policy vs digital policy but think of the real world we live in and the ethical issues we face every day. My point was that I can be pissed that the GAP doesn't have an outfit that is as stylish or fit as well as I want. And I can think that they arent serving their customer when they give me ugly clothes that dont fit well. ie: their busiess model sucks. But I don't think that gives me the right to take any of their clothes without paying just because I am an unhappy customer. That was my ONLY point. Do I think that the content industry has moved way too slowly in putting their content online? Absolutely. Do I think they could have been and should be more innovative? of course. But I also know that these are huge ships turning around in creeks and however easy the answers seem to you , they are often really hard. When people screw up their business, their sales go down. That has happened in the entertainment business. They are paying a price for their pace of change. BUT, there is also stealing. Pure old simple unethical stealing. Call it whatever you want - the march of technology - the inevitable cost of innovation, etc. To the writer or songwriter who makes their money on SALES, it is stealing. (Even if they might be thinking about making their money another way.) And while I love the dialog by for and about consumers and fans on these issues, I have no patience for big companies like Google who not only throw huge sums of money out there buying professors and economists and think tanks to kill any effort at copyright protection, they make a fortune on search advertising for those same illegal products.

So, your first sentence was right, I have long been willing to shine an unattractive searchlight at my old compatriots when they deserve it But I have no patience for the finger pointing and nastiness of the so called tech fans in this debate. Thank god I don't have to care so much anymore.

While we appreciate Rosen stopping by and joining in the discussion, the responses highlighted the myriad problems with this statement, going beyond both the tortured, nonsensical analogy (who steals something from a store that doesn't have what they want, or who steals clothes they don't like because they don't like them?) and the ridiculous "it's theft!" claims. If you want to read the full thread or discuss her specific points, I urge you to go to that thread and continue the conversation there.

The whole exchange got me thinking about some bigger issues though. Rosen's comments reminded me so much of my experiences at various recording industry events, where they pay basic lip service to things like "we have to adapt" and "we have to stop blaming customers," but then immediately flips to "but piracy must be stamped out first!" never recognizing that these two things are at odds. And what it boils down to is a mixture of a psychological issue and a confusion over economics.

First, Rosen's response, like many others, falls back on facile and inaccurate "morality" claims. This is usually a sign of a very weak structural framework to an argument. When you can't explain why, you resort to "well, it's just wrong." But, as we've explained for years, the "morality" aspect of an economic decision only comes into play when there's a decision to be made about who will be worse off. That's all morals really are about. If move x harms person y, is it "right" to do that? Folks like Rosen and many SOPA/PIPA supporters see what's happening online and it looks exactly like the previous sentence: "If downloading music harms musicians/songwriters, it's clearly not right to do that."

But that misunderstands the wider economic implications of what's happening. Let's put it another way to make this clear: If selling automobiles harms the makers of buggy whips, is it "right" to do that? I think most everyone would claim that it's fine. This is innovation in process. Thus, the simple statement, "If move x harms person y, that's immoral," seems way too simplistic. Let's expand it out further. What if, in our buggy whip hypothetical, the rise of the automobile forces the buggy whip maker to change their business model... such that they no longer make buggy whips, but steering wheels. The classical lover of buggy whips may find this upsetting -- and the buggy whip maker may complain, "but buggy whips are my product, I'm not in the steering wheel business." But the market doesn't care. In this situation, the morality question is more complex: "If move x harms person y in the short term... but opens up much greater opportunity for them to do better by accessing a much larger market, is it right?" Suddenly, the moral issue is pretty straightforward. There's no moral question at all. The market has changed, and as long as the whip maker comes along for the ride, the opportunity is there to be better off. It may be a challenge, but it's hardly a moral issue.

Rather than confront this, the people who insist this must be a moral issue, back up their claims with a secondary claim to make it seem like a moral issue: "someone else is profiting off my work, and that's unfair." In many cases, the "someone" they point to is "Google." This is mostly a correlation vs. causation error. People see that Google is massively successful, and the timing correlates well with the decline in the record labels. So they assume that Google must be "taking" money from the labels. This is quite inaccurate and shows a lack of knowledge about a variety of subjects, beyond the fact that correlation is not necessarily causation. In the thread with Rosen, I point out that the claims that Google "profits" from infringement are widely overblown. Google makes money from clicks, and infringers aren't hanging around these sites clicking on ads.

But the bigger issue is this relative morality issue of "If someone else benefits from my work without paying, that's unfair." But, again, this is way too simplistic and not reflective of reality. People benefit from the work of others for free all the time. In economics, it's known as an externality. Tragically (and potentially because of the name), people think that externalities are rare. They're not. They happen all the time. Every day, people benefit freely from the work of others without paying. As the saying goes, we all "stand on the shoulder's of giants." So much of what we value today comes from advancements in the past, which we benefit from, without paying those who created them. And yet, no one thinks this is bad.

The real question is if whether you can take it a step further and recognize that the economy is not a zero-sum game, in which one party loses when the other benefits. This is often difficult to understand, but put simply: in a zero-sum market, someone paying you $10 means I lose those $10. In such a scenario it may be reasonable to worry about someone else profiting, because it really does mean you lose. But in a non-zero sum market, with externalities, the market can expand. If every time you get paid $10, I now have the opportunity to make $100, that's clearly a better deal. But, let's make it a little more complex. In the zero sum game, every time you get $10, it's at my expense. But what if the other option in that world is that every time I raise my hand, you get $10 and I get just $1. That's still a much better deal for me to take than the one where I lose money. In this case, I might not make as much as you -- even if I'm doing the work, but is that morally wrong? We're both better off under this scenario. You're better off because you make more money. And I'm better off because I'm making more money... just not as much as you.

But, for whatever reason -- psychology, economic ignorance, etc, -- many people react poorly to this, claiming that it's a moral problem. I, personally, have trouble seeing how a situation in which everyone is better off results in any sort of moral dilemma, since we never reach that crucial moral question of "who gets harmed?" Because no one has to get harmed. But here's the kicker: no one has to get harmed if they adapt. And it's the adaption part that freaks people out and makes them want to cling to something clearer, even if it makes them worse off in the long run.

We've talked about Medical Justice a few times. This is the highly questionable outfit that gives doctors and dentists forms that these medical professionals then require patients to sign in order to get treated. The forms require the patients to pre-emptively hand over the copyright on any future reviews they might write about that medical professional. The idea is that if the doctor or dentist doesn't like the review, they can then just use the DMCA to take it down, claiming that the review infringes on their copyright. Yes, this is incredibly sleazy. This clearly has nothing to do with copyright, but rather it's a use of copyright law to try to censor criticism. There are both ethical and legal problems with this... and the legal problems are about to be discussed in court.

Public Citizen has filed a class action lawsuit against a New York dentist, Stacy Makhnevich, who not only used the Medical Justice forms, but then sent one of her patients invoices, supposedly billing him $100 per day for having posted comments about her online. As Paul Alan Levy explains:

Our individual client, Robert Lee, had a bad experience, not with Makhnevich’s dental work, but with her billing and her failure to submit the documents he needed to get reimbursed by insurance.  After his repeated efforts to get her office to do what they were supposed to do, he posted complaints on Yelp and on DoctorBase.  Makhnevich threatened to sue him over the posts, and sent DMCA takedowns, but no doubt to her surprise, not only did the patient not remove his comments, but both Yelp and DoctorBase defied the threat of infringement liability, telling Makhnevich that they regarded her agreement with the patient as illegal.  Undeterred, Makhnevich sent Lee invoices purporting to bill him $100 per day for the continued copyright infringement.  Makhnevich also hired a lawyer who sent additional threats of litigation, but rather than continue to wait to be sued, Lee has now filed suit for a judgment declaring the agreement void, an injunction preventing Makhnevich from imposing the agreement on other patients, and a notice to all Makhnevich patients informing them that they are no longer restrained by the agreement.

A few interesting things come out in the lawsuit. First, the fact that both Yelp and DoctorBase defied the DMCA takedowns. Both companies deserve kudos for that. Standing up to bogus DMCA takedowns is pretty rare these days, because the risk of getting roped into a costly lawsuit is just too high. In this case, the fact that there had been so much news about Medical Justice and it's questionable concept, and both Yelp and DoctorBase were aware of this earlier, certainly helped. Still, standing up to such threats deserves praise.

Second, the lawsuit notes that not only is this copyright abuse, but the DMCA takedown notices appear to violate HIPAA -- the federal Health Insurance Portability and Accountability Act -- which is supposed to guarantee privacy for patient info.

In September, 2011, on the letterhead of Aster Dental, a member of Dr. Makhnevich’s staff sent takedown letters under the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C. § 512(c)(3), to Yelp and to DoctorBase, asserting that Dr. Makhnevich owned the copyright in Lee’s Commentary pursuant to the Agreement. Defendants warned Yelp and DoctorBase that, if they did not remove the posts immediately, they would lose the immunity that the DMCA otherwise provides Internet Service Providers against monetary liability for copyright infringement. In violation of HIPAA, these takedown notices disclosed plaintiff’s height, weight and birth date, as well as his picture and his home address

The lawsuit also makes the claim that these comments, even if the copyright on them has been assigned, would still be protected as fair use. But, more importantly, it argues that these agreements in the first place constitute "copyright misuse" noting that the agreements:

constitute unclean hands and, with respect to such purported acquisition and assertion, constitute copyright misuse in light of the means by which defendants purportedly acquire the copyrights and because the purpose of such acquisition and assertion of copyright is to suppress truthful commentary concerning defendants and matters of public concern.

No matter what, this should be an interesting lawsuit to follow. As Levy explains, beyond the legal arguments, there is an important public policy aspect to this lawsuit:

The purpose of copyright law is to encourage creative expression by providing a temporary monopoly (sadly, less and less temporary) that enables those whose expression is marketable to reap financial rewards for their work. At the same time, copyright law avoids giving any monopoly on facts or ideas. Agreements like the one at stake in the Makhnevich case turn copyright law on its head by taking advantage of the fact that, as a practical matter, ideas and facts are articulated through copyrightable expression; hence anything that a patient writes about a doctor or dentist is likely to have sufficient originality to be copyrighted. The Medical Injustice agreements allow professionals who use them to suppress the underlying opinions and facts, not to reap financial rewards from the expression and not to encourage further creativity. This is a misuse of copyright law and in our view it needs to be stopped.

However, from a future policy perspective, it appears that this lawsuit has already been a win. Within a day of the lawsuit being filed, Medical Justice has announced that it's retiring the agreement... and that it probably should have earlier. It also claims that it's telling doctors to stop using them. We'll see if that actually happens... and if anyone else jumps into the fray instead.

Back in January of this year, Techdirt reported on tobacco companies suing a local Australian importer of their products for covering up part of their logos with a mandatory health warning. At the time, a spokeswoman for the company involved, British American Tobacco, said:

As the matter is currently before the Court, BAT is unable to comment other than to say that this is a further demonstration that we will take all necessary steps to protect our valuable intellectual property.

Given that stance, it will come as no surprise to learn that tobacco companies are now threatening to take on the European Commission as well:

EU Health Commissioner John Dalli will face legal action if he tries to reproduce Australia's plain-packaging proposals for cigarettes in Europe, a tobacco industry representative warned this week.

The approach is the same as in Australia:

One likely focus of attack is intellectual property rights, since plain packaging has a smothering effect on companies' logos and trademarks.

I'd like to think that the word "smothering" was taken verbatim from some tobacco company representative, because it sums up nicely the industry's attitude: that any breathing difficulties or respiratory diseases that you may develop as the result of smoking pale into insignificance compared with the outrageous "smothering" of their logos and trademarks.

That's a particularly callous attitude, because those logos and trademarks are only valuable to the degree they have been attached to products that have caused death and disease: the "best" brands are those with a track record of selling – and hence killing – more people than rival products. In effect, the tobacco companies are complaining that all their hard work getting people addicted and smoking themselves to death will be wasted if the plain-packaging proposals for cigarettes are implemented.

The cynical posturing of tobacco firms as the victims in these continuing attempts to undo and avoid the social harm they cause underlines once more how easily intellectual monopolies can be twisted for purposes far from any original justification they may once have had. Patents can kill: so, it seems will trademarks, if tobacco companies get their way.

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The MPAA is famous for throwing around all sorts of completely bogus numbers when it comes to the "costs" of online infringement. Even parts of the US government have mocked the MPAA for its way of calculating "losses" from infringement. In one case, the calculation was so ridiculous that even the MPAA had to admit that it had fudged the numbers. However, the folks over at TorrentFreak decided to see if they could come up with a more reasonable calculation by doing a thought exercise: what if everyone who shared unauthorized movies and TV shows via BitTorrent, suddenly switched to Netflix instead? How much more revenue would that bring in?

The answer? Not a hell of a lot. Now, the report makes a large number of assumptions -- all of which are laid out directly, and whenever possible, they sought to use a number that favored the MPAA. So they assume that every download is a "lost sale" and are extremely quick to inflate how much BitTorrent traffic is movies and TV. They also assume that all BitTorrent traffic is infringing. Again, the idea is to be as favorable as possible to Hollywood. In the end, they find that it's possible the studios might have made about $60 million more under this simplistic scenario. They then point out that the MPAA's own budget is greater than that. We can quibble about the methodology, but assuming that the methodology stands up, it certainly raises significant questions about the true size of the "issue."

The folks at M-CAM have noticed a new trend in patent trolling: trolls are starting to target media companies with patent lawsuits, rather than just tech companies. The M-CAM report, by the way, is done almost entirely in verse, which is quite entertaining. Here's just the very beginning:

Have you seen a troll yet this year?
Speckled, short, inciting fear?
We’ve heard them described as non-practicing entities
But we know “patent troll” is their proper identity.

Technology, it seems, is their favorite sector
The bones they pick, like Hannibal Lecter.
Big tech has had to make sacrifice
Of legal settlements at extravagant price.

The trolls have grown fat from the tolls they’ve collected
They proclaim, “Innovation – it must be protected!”
Though to make or create, they have no intention
Only hopes to profit off other’s creations.
And now they look for new bridges to block
Scouting for more victims whose stocks they can shock.

Of course, while media companies aren't quite as used to dealing with patent lawsuits, and also don't have patent portfolios of their own should they be sued by practicing entities, the one thing they do have is the ability to sway public opinion. It will be interesting to see, as this keeps up, if it backfires on the trolling firms by simply calling more and more attention to some of their practices.