Even if SOPA passes in its current form, largely intact and full of overreach opportunities, there's no reason to believe this will be the last (or even the most overreaching) legislation crafted at the behest of the content industries.

The -AA's long history of overreaction to various "threats" (read: technological advancements) has been well detailed here at Techdirt. Joe Karaganis opens a recent post at the SSRC (Social Science Research Council) blog with this mystery quote:

Several of these analyses of alleged harm to the recording industry... were presented and debated during hearings on copyright... At each hearing, X presented the results of the most recent analysis done for the recording industry by his firm... [As] in his earlier testimonies, he stated that continued [copying] had grave implications for the viability of the recording industry. Noting that recording-industry releases were down by almost half since ****, and that industry employment had declined... X stated that further growth in [copying] would cause further decline in these industry indicators.

Karaganis asks: "So, who is X and what is the timeframe?"

If it's hard to guess, there's a reason for that. Because of the industries' insistence on turning every new "threat" into a federal case, this could have happened at any time in the last 50 years. Or it could be happening right now. The answer, however, is a bit surprising, considering who is being referenced.

Did you guess: Alan Greenspan in the early 1980s? Bravo.

To say that Greenspan's reputation has taken a bit of hit since stepping down as chairman of the Federal Reserve would be an understatement. To see that he wilfully (perhaps motivated by a donation) pled on the RIAA's and MPAA's behalf does nothing to resurrect his respectability. Karaganis quotes from a recounting of home taping battles, put together by the (now defunct) OTA (Office of Technology Assessment):

By 1986, industry stakeholders...had sponsored almost a dozen surveys and studies, usually to support or oppose passage of home-copying legislation. ... OTA noted:

In the 1985 analysis, sponsored by the RIAA, Greenspan estimated that in 1984, each instance of home taping cost the taper $1.67 per album equivalent, compared with an average retail price of $6.80. On the basis of an earlier report on home taping by the firm Audits & Surveys, Townsend & Greenspan estimated that 42 percent of all home tapings from prerecorded material and 40% of off-the-air (broadcast) tapings would have generated sales, if taping had not been possible. Then, assuming that 40 percent of home taping in 1984 was in lieu of purchases of records or recorded cassettes, the firm estimated 1984 retail losses of some $1.5 billion...

Moreover, as in his earlier testimonies, he stated that continued home taping had grave implications for the viability of the recording industry. Noting that recording-industry releases were down by almost half since 1979, and that industry employment had declined from 29,000 in the late 1970s to less than 19,000 in 1984, Greenspan stated that further growth in home taping would cause further decline in these industry indicators.

This sort of alarmism is very familiar to anyone paying attention. The refusal to recognize the technological advancement as being a possible ally to the industries is shrugged off in favor of panicked statements and questionable numbers. This very refusal to consider the "benefit" side of the argument is called out by the OTA and other industry groups:

Greenspan's two earlier studies had estimated losses...amounting to $1.05 billion for 1981 and $1.4 billion in 1982. The Consumer Electronics Group of the Electronics Industries Association (EIA), the Audio Recording Rights Coalition, and the Home Recording Rights Coalition (HRRC) submitted dissenting comments and testimony disputing these estimates. ... EIA claimed that the analysis for RIAA had ignored the stimulative effects of home taping on sales of recordings, and that some home tapes (e.g. selection tapes made for portable or car tape players) are not substitutes for prerecorded products... A pattern emerges in these debates. The published recording industry arguments and economic analyses deal only with estimates of alleged harms...

Much like the past decade, the RIAA and MPAA have spent an immense amount of time, energy and money attempting to place the blame for their economic downturn solely in the hands of infringers, completely ignoring other surrounding economic factors or the drastic changes in consumer habits. This selective blindness is nothing new:

[I]t's worth noting that Greenspan spent several years trying to pass stronger enforcement laws based on a scare story about a temporary dip in the market, as the cassette displaced the 8-Track and vinyl went into decline (and the US suffered a major recession). Stronger enforcement was a solution to maintaining the revenue levels associated with the LP and 8-Track. And he made this case at the beginning of the greatest boom period in the recorded music industry: the CD era. Now that the CD is dying, our present-day Greenspans are doing the same.

Everything continues to change but the arguments remain the same. The fact that Alan Greenspan delivered these remarks is somewhat surprising considering his later stance on IP issues. In a 2004 speech at the Stanford Institute for Economic Policy Research Economic Summit, Greenspan had this to say, seemingly forgetting his earlier efforts on the home taping battlefront:

"If our objective is to maximize economic growth, are we striking the right balance in our protection of intellectual property rights? Are the protections sufficiently broad to encourage innovation but not so broad as to shut down follow-on innovation? Are such protections so vague that they produce uncertainties that raise risk premiums and the cost of capital? How appropriate is our current system--developed for a world in which physical assets predominated--for an economy in which value increasingly is embodied in ideas rather than tangible capital?"

Greenspan is mostly referring to patents here, but a lot of what he says holds true across the rest of the intellectual property spectrum. There is a good possibility that Greenspan learned something from his earlier experience, recognizing the fact that technological progression tends to displace legacy industries, but it just as often creates new opportunities, provided it is not stifled by antagonistic legislation designed by the legacy industries in order to protect the status quo.

And about that status quo? Whose status quo is really being protected?

As the MP3 replaced the CD, the major labels cut their distribution costs, struggled to keep digital prices at rough parity with the CD, and pocketed the difference. An artist signed with a major label still makes 15-20% on wholesale-no more than for a good deal in the CD era. Many of the indie labels and digital aggregator services, in contrast, return 50-90% of the wholesale price to the artist. It is glaringly obvious that the major labels' 80% wholesale cut isn't sustainable-nor, I will predict, is Apple's 30% retail cut. Piracy was the messenger, not the message.

Costs have decreased across the board, but artists are still getting the short end of the stick. This isn't about them. It's about the labels, studios and their executives. Despite their constant complaints about how much sales have decreased, executive salaries have never been subject to the same downturn. Karaganis quotes The Lefsetz Letter:

Used to be running a label paid well, but it was mostly about the music, the lifestyle. Then, with the advent of MTV and the CD, suddenly Tommy Mottola was far richer than the acts. And Tommy and his ilk started hanging with other rich people in the Hamptons, they felt entitled to their wealth. Such that when Napster blew a hole in the paradigm, everybody was sacrificed but the top guy. The people running the labels are still as well paid as they were before Napster, before the recession. They're keeping up with the joneses, they're in charge, everybody's expendable but them. As for those people still working at the label...they're thrilled to have a job. Glad to be slaves on the plantation.

The arguments are old and repetitive and the rhetoric has expanded past "think of the poor artists" to "protecting jobs" to the outer reaches of credibility, conjuring up victims such as the US military and firemen. And that's because it's not really about protecting artists. It's about protecting industries which have become used to a certain "standard of living" and now the general public can't be as easily duped about sales numbers and executive salaries, all sorts of emotional buttons are being pushed in a very haphazard and desperate manner.

If it's any consolation, there will be more on the way. I highly suspect there will be never be a legislative solution to the problems of the content industries solely because much of the problem lies with the industries themselves.

(H/T - Ulysses)

Most people instinctively appreciate the dangers of government surveillance. But at least it's possible to be on your guard when you suspect such surveillance may be present by taking care what you write and send. You might even use some industrial-grade encryption for the important stuff.

The problem with that is it's simply not practical to expect all of your contacts – to say nothing of your grandparents – to do the same, which means that at least some of your emails are going to be exchanged in the clear. And as this fascinating Bloomberg report about the surveillance activities of the former Tunisian regime reveals, that creates another kind of vulnerability that concerns not only what you send, but also what you receive:

Asma Hedi Nairi, a former Amnesty International youth coordinator, says e-mails she and her friends exchanged were replaced by messages ranging from random symbols to ads for rental cars. Opponents of the regime toppled in January’s revolution received threatening messages such as “you can run but you can’t hide,” while people with no role in politics found their correspondence snagged if it inadvertently included words flagged as critical of the government. Ammar 404 even damaged reputations by inserting pornographic images in work e- mails and routing intimate photos onto Facebook, Nairi, 23, says.

It's a clever approach, whereby people start to attribute a deep, possibly troubling meaning to what is in fact nonsense, or begin to doubt the trustworthiness of their online contacts.

What makes this story particularly disturbing is that practically all the technology used to carry out this disinformation campaign in Tunisia was provided by Western companies, who seemed to view it as a test run:

Western suppliers used the country as a testing ground. Moez Chakchouk, the post-revolution head of the Tunisian Internet Agency, says he’s discovered that the monitoring industry gave discounts to the government-controlled agency, known by its French acronym ATI, to gain access.

That's yet another reason to resist Net surveillance for any reason (hello, copyright industries): once surveillance equipment manufacturers have their foot in the door it can only be a matter of time before they start extolling the virtues of Tunisia's more thoroughgoing approach to online spying.

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Apple has been garnering quite a reputation for itself as a patent bully, for example using patents around the world in an attempt to stop Samsung competing in the tablet market, and bolstering patent trolls. But that's not enough for the company, it seems: now it wants to use patents to block open standards.

As befits an organization that seeks to promote the Web, the World Wide Web Consortium (W3C) has a clear policy on the use of patents in its standards:

In order to promote the widest adoption of Web standards, W3C seeks to issue Recommendations that can be implemented on a Royalty-Free (RF) basis. Subject to the conditions of this policy, W3C will not approve a Recommendation if it is aware that Essential Claims exist which are not available on Royalty-Free terms.

< ...>

As a condition of participating in a Working Group, each participant (W3C Members, W3C Team members, invited experts, and members of the public) shall agree to make available under W3C RF licensing requirements any Essential Claims related to the work of that particular Working Group.

That's to ensure that no company has a stranglehold over a W3C standard that it can use to extract a monopoly rent from the implementations, and to create a level playing field so that all companies can compete fairly.

Clearly, Apple's not happy with that approach, since it has just disclosed some patents that may be relevant to a new open standard the W3C is working on. Opera Software's Haavard Moen explains the significance of the move:

This time they have four claims - three patents and one patent application - that threaten to block the W3C Touch Events Specification. They filed their patent claims a little over a month before the time limit expired (the claim was filed on November 11, and the time limit is December 26, 2011).

The odd thing is that Apple chose not to join the working group that handles touch events. If they had joined, they would have been forced to file the patent claims far sooner. So now we know why they didn't join. What we don't know is why Apple insists on waiting almost until the last minute before filing its patent claims.

As Moen points out, this is not the first time Apple has pulled this trick of disclosing patents at the last moment, and throwing a spanner in the W3C's machinery. This suggests that it doesn't have a problem with the specific W3C open standard, but with open standards in general.

Moreover, there are serious knock-on effects for the whole of W3C:

What makes this matter even worse is that this doesn't just affect these specific standards. The Patent Advisory Groups could in fact slow down the development of other standards by pulling people from other projects in order to investigate these claims. The investigation can take several months, and will take time, resources and money to complete.

That's time, resources and money that could have been spent on improving various other work-in-progress standards.

You would have thought that a company as successful and generally admired as Apple would go out of its way to be helpful to these industry efforts to bring open standards to the Web for the benefit of users. Sadly, it seems to take the view that the only thing that matters is preserving its own power and profit, and that one way to do that is to stop the spread of open standards that give everyone an equal chance in emerging markets. The only consolation is that Apple's latest move adds to the evidence that patents today are more about stifling the competition than promoting innovation.

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

Modern farming isn't as low-tech as it used to be. There are invasive species of insects to deal with and growing concerns over using various pesticides to control them. But until we figure out the perfect formula for Soylent Green, the economically-viable options for producing cheap and plentiful food seem a bit limited. Here are just a few examples of problems in the food industry.

• A study of over 200 pregnant women indicates that there is a possible link between eating rice (grown in the US!) and consuming potentially harmful levels of arsenic. Apparently, the arsenic comes from years of pesticide use where rice is grown, and unfortunately, there aren't any legal limits for arsenic in most foods sold in the US. [url]
• Farmers are looking to kill off stink bugs without pesticides using parasitic wasps. But first, researchers need to determine if releasing the wasps won't cause even more problems with farm crops and the environment. [url]
• Strains of Escherichia coli on bean sprouts that caused food poisonings and deaths in Germany may have come from human sources. Japanese researchers suggest a remedy of soaking the veggies in strong vinegar to kill off these nasty bugs. [url]
• To discover more food-related links, check out what's floating around in StumbleUpon. [url]  

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

With the proliferation of smartphones and other portable electronic devices such as tablet computers and e-readers, we are often left wondering, "Do we really own the books, games and other apps we pay money for?" Now that question has spread to your computer as well. PC World has revealed that Microsoft's terms of service for its Windows 8 app store gives it the right to not only disable but also remove apps Windows 8 device owners paid money to own. In Microsoft's own words:

In cases where your security is at risk, or where we're required to do so for legal reasons, you may not be able to run apps or access content that you previously acquired or purchased a license for.

This is probably nothing new to users of the Amazon Kindle who had their copies of the book 1984 remotely deleted or to people who bought music from Rhapsody who had their DRM'ed tracks reduced to nothing over night. Nor is this unique to these businesses. As PC World also notes, both Apple and Google retain the right to remove software users of their devices "bought". Businesses have been calling to question the ownership of digital products for quite some time. If we cannot prevent the loss of legally purchased products from those which sold these products to us, how can we really claim ownership?

If it is any consolation to you, Microsoft has told PC Mag that it will refund buyers of apps it deletes. However, any data you may have saved using the app will be completely lost. So not even the work that you put into this software is yours to claim ownership.

While Microsoft claims that it will primarily remove software in the case of security violations, it also retains this power for cases of "legal or contractual requirements." This is quite the broad opening left here. With the looming threat of increased enforcement of Copyright through SOPA and PIPA, the idea that an app can be removed via a "legal requirement" creates yet another question over ownership. If an app we purchase ends up infringing some company's copyright, patent or trademark, they could theoretically use that as a tool to remove that app from our devices.

We are moving further and further into a digital landscape for everything from movies, music, books, games and software. With this transition, companies that produce these products are working overtime to remind consumers that they are not owners of these products but merely licensees. We will not have the luxury of physical media on which we can claim ownership rights for much longer. Consumers for the last few years have been clamoring for more digital content. They have been the primary drivers of this transition. The only real question left is, do they realize the consequences that come with this change, and will they demand the right to claim ownership?

Paul Tassi has an article up at Forbes, where he explains how the blog he runs for a living, Unreality, which covers movies/tv/video games, would be at risk of being shut down under SOPA. Even though his site has nothing to do with infringement, he's still quite reasonably worried:

My site likes to find the best media-related content on the internet. We post photos, artwork and embed YouTube videos that involve things about our favorite movies, shows and games. I always give credit where it’s due, but on occasion, a photographer or artist cannot be located. Under SOPA, should they find their content on my site, they would legally have the right to petition my advertisers to stop paying me, or report me to the government. The same goes for YouTube videos I might feature. Though the content is not mine, as I haven’t uploaded it to the web myself, I am indeed linking to it, and with this new law, I would be subject to the same sort of harsh penalties should the content within be something copyrighted like footage from a game or movie. I am willingly linking to “infringing” content, and under SOPA, can be branded a “rogue site” because of that. Such a classification could cause me to lose everything.

It's not clear if Tassi is in the US. If he is, then he's actually (partially) exaggerating, because as of Monday, SOPA no longer applies to US sites. But that's not good news. Because if he's a US site, then he's already subject to bogus seizures by the government, by which his web site could totally disappear for over a year with no due process whatsoever. Actually, no matter where he is physically, his site -- as a dot com -- is already subject to that kind of censorship. Even without SOPA. All someone has to do is convince a somewhat clueless Immigrations & Customs Enforcement official that his site has lots of infringing content on it -- even if it does not.

I don’t understand the entertainment companies’ end game here. They’ve gone beyond obtuse to straight up maniacal. Do they think if they manage to shut down every bit of copyright infringement on the internet, that sales are going to suddenly skyrocket? Do they think people have some secret horde of cash that they’ve just been waiting to blow on DVDs and CDs, but haven’t because of The Pirate Bay’s existence? If my site can’t link to gameplay videos or movie clips, are my readers going to run out and buy them to see what they’re missing? If they land Unreality on a rogue evil pirate site list, who benefits? I’m suddenly homeless, without any cash to go the movies.

It's a good question. The "end game" is all about control. The legacy entertainment industry built their business models entirely on the basis of the idea that they, not consumers, controlled the market. Everything they're doing is seeking to regain that lost control. As Tassi notes, none of that will actually make people buy more. But that's never what this was about.

We usually strive to come up with our own headlines for posts on Techdirt, but Joshua Kopstein's post on Motherboard.tv has such a perfect title that we're reusing it here: Dear Congress, It's No Longer OK To Not Know How The Internet Works. The point, which was driving so many of us mad watching the SOPA hearings, is how head-bangingly frustrating it is to see elected officials gleefully admit they don't understand the technology they're about to regulate:

I remember fondly the days when we were all tickled pink by our elected officials’ struggle to understand how the internet works. Whether it was George W. Bush referring to “the internets” or Senator Ted Stevens describing said internets as “a series of tubes,” we would sit back and chortle at our well-meaning but horribly uninformed representatives, confident that the right people would eventually steer them back on course. Well I have news for members of Congress: Those days are over.

We get it. You think you can be cute and old-fashioned by openly admitting that you don’t know what a DNS server is. You relish in the opportunity to put on a half-cocked smile and ask to skip over the techno-jargon, conveniently masking your ignorance by making yourselves seem better aligned with the average American joe or jane — the “non-nerds” among us.

But this isn't about looking cute and folksy. The internet matters. A lot.

But to anyone of moderate intelligence that tuned in to yesterday’s Congressional mark-up of SOPA, the legislation that seeks to fundamentally change how the internet works, you kind of just looked like a bunch of jack-asses.

Kopstein goes into a lot more (worthwhile, go read it) detail about the bill, about the gleeful ignorance of some Judiciary Committee members, and then concludes:

This used to be funny, but now it’s really just terrifying. We’re dealing with legislation that will completely change the face of the internet and free speech for years to come. Yet here we are, still at the mercy of underachieving Congressional know-nothings that have more in common with the slacker students sitting in the back of math class than elected representatives. The fact that some of the people charged with representing us must be dragged kicking and screaming out of their complacency on such matters is no longer endearing — it’s just pathetic and sad.

This is a key point. Unfortunately, I've see way too many people supporting SOPA (especially among the lobbyist crew) act as if this is just some sort of game, where the goal is to "win." That's how DC politics works, but it doesn't take into account the very real impact of the damage that they're doing. If you're regulating the internet, it should at least be a pre-requisite that you are willing to understand the technology, or that you abstain from taking part in voting on (or writing) bills if you don't understand it. It's not funny. It's not cute. It's terrifying and it impacts us all.

So the real question is what is the way forward on this kind of thing? One would be to elect more technically savvy folks to Congress, but that's always difficult (and lots of tech savvy folks would rather be working in tech). Another would be to better educate those who are in Congress. Some of us are already working on that front with things like Engine Advocacy, but having more help and more voices would be a good thing.

Other than that, I think we should just make it clear to elected officials that people won't tolerate them gleefully displaying ignorance on issues that they're about to vote on. When Rep. Mel Watt declares proudly that he doesn't understand the technology, and then says he just doesn't believe the huge group of internet engineers who warn about the negative impacts of SOPA, he shouldn't get a free pass on that. The public needs to let him know that that's unacceptable from an elected official.

Things like this won't change overnight, but by making it clear that such things won't be tolerated by the voting public, we can at least start to influence the debate in a meaningful way. So speak up. When you see an elected official being purposely ignorant or cracking jokes about their ignorance tell them that they need to be educated and help them get that education.

Earlier this year we wrote about a tough case, involving a guy who apparently spent nearly all of his waking hours bombarding a Buddhist leader he had a falling out with, with nasty, offensive and threatening messages on Twitter. He was charged with criminal stalking. This raised an awful lot of questions about the First Amendment, and a judge has now ruled that the tweets were, in fact, protected free speech. I tend to think the ruling here is correct, though I can see how this troubles people. As the judge noted, however:

Even though the Internet is the newest medium for anonymous, uncomfortable expression touching on political or religious matters, online speech is equally protected under the First Amendment as there is "no basis for qualifying the level of First Amendment scrutiny that should be applied" to online speech.... Indeed "whatever the challenges of applying the Constitution to ever-advancing technology, basic principles of freedom of speech and press, like the First Amendment's command, do not vary when a new and different medium for communication appears."

Funny. I would think that this same reasoning would apply against domain seizures and SOPA, but it never seems to come up. That said, if the guy represents a real threat, I would think there are other laws that should cover that, outside of this broad "anti-stalking" law that was used. The fact that he caused "emotional distress" to the person his tweets were directed at is unfortunate and sad... but not illegal.

So this was a bit of a surprise. Lots of people expected Lamar Smith to keep the SOPA markup process going until he could get a vote out, even if it was late tonight. But it looks like he ran out of time. With Congress settling it's other business and closing up shop, Smith abruptly ended the markup, saying they'll resume at the next available date -- which likely won't be until late January. They only had time to go through two amendments, the second of which was withdrawn. That was from Rep. Chaffetz who asked that the DNS/IP blocking sections not be put into effect until after a thorough analysis was done by experts on their impact on online security. Somewhat surprisingly, Smith seemed willing to agree to something like this. He came close to suggesting that perhaps they should, in fact, have hearings with some of these experts concerned about the internet blocking part of SOPA (perhaps because he realized that SOPA wouldn't get voted on today). Of course, now we'll have to see what actually happens.

In the meantime, this represents a very brief, but significant, victory for those in favor of internet freedom and against internet censorship in the US. Have no fear, however, that Hollywood and the US Chamber of Commerce will be pushing very, very, very hard to get SOPA approved as soon as possible. This fight isn't over by a long shot, but there does appear to be a brief and thankful reprieve. The momentum is also on the side of those opposed. When PROTECT IP came out early this year, it was seen as a slam dunk. Congress would bend over backwards to grant Hollywood its wishes. The fact that it's getting pushed into the new year is big, big news. On top of that, people have really jumped up on this one. The grassroots efforts have been amazing -- as an issue that normally gets little attention (copyright) has become a very mainstream issue in a matter of months. We keep hearing about SOPA from random and surprising places. This needs to keep up and Congress needs to learn that giving in to Hollywood's short-sighted whims isn't going to go over well with the public.

Update.... Or not. Despite the fact that Congress was supposed to be out of session until the end of January, the Judiciary Committee has just announced plans to come back to continue the markup this coming Wednesday. This is rather unusual and totally unnecessary. But it shows just how desperate Hollywood is to pass this bill as quickly as possible, before the momentum of opposition builds up even further.

With the (way too late) return of Dajaz1.com after over a year of prior restraint and denied due process, there's increasing interest in Homeland Security's efforts to censor websites through its Immigration and Customs Enforcement (ICE) division. Earlier this year, we noted that ICE appeared to be stalling in response to Michael Robertson's Freedom of Information Act (FOIA) request for info related to the round of domain seizures that got Dajaz1 (as well as still unaccounted for domains OnSmash.com and Torrent-Finder.com).

Robertson has sent over the entirety of what ICE eventually sent over. They claimed to have found 754 responsive pages... but 144 of those pages are completely redacted. The other pages are also full of redacted info. I've gone through a few hundred of the pages, and it's pretty useless. It basically looks like the administrative paperwork ICE filed on its activities. Details are pretty slim, though you can catch a glimpse of their thinking here or there -- such as saying that when seizing domains that are still part of an investigation, "no seizure noticed should be issued to the violator." Ah, the US government -- seizing speech and refusing to even notify those impacted.

Either way, I figure with a lot more eyes looking over these documents, perhaps someone would pick up a detail or two that isn't readily obvious on a quick skim of all the documents... so have at the embeds below:

I already wrote a big post about yesterday's SOPA markup day one. While we're moving forward on day two, I wanted to call out one key point that was really made clear by an amendment offered by Rep. Jared Polis late in the day yesterday, which hasn't received nearly enough attention. As you may recall, with the "manager's amendment" version of SOPA (i.e., SOPA 2.0), the "notice-and-shut off funding" section of the private right of action in Section 103 was removed. This was good, because we've seen how the notice-and-takedown provision of the DMCA has been widely abused.

However, what most people missed was that the bill effectively sneaks this back into the bill in a much worse form in Section 105, which supposedly grants "immunity" to service providers for taking voluntary action to stop infringement. The true impact of this section was only made clear by Rep. Polis' attempt to limit it, as he highlighted how this broad immunity would likely lead to abuse. That's because this section says that anyone who takes voluntary action "based on credible evidence": basically gets full immunity. Think about what that means in practice. If someone sends a service provider a notice claiming infringement on the site under this bill, the first thing every lawyer will tell them is "quick, take voluntary action to cut them off, so you get immunity." Even worse, since this is just about immunity, there are no counternotice rules or anything requiring any process for those cut off to be able to have any redress whatsoever.

This is scary.

Rep. Polis, quite reasonably sought to limit this section to avoid such a situation. As he noted, anyone can send in a notice under this section, and the service provider is likely to take action to keep immunity. That's super wide open for abuse.

The debate on this point was downright painful. Some of the others on the Committee insisted that Polis' interpretation of the section was wrong. But it's not. Rep. Ted Deutsch kept misreading the law, pretending that because it talks about the "actions" in earlier sections (that you can take to get immunity), it means that the conditions for those actions must be the same (i.e., there needs to be a court order). But the law doesn't say that at all. Others insisted that there needed to be a court order to get the immunity as well.

Let's put this simply: that's ridiculous. And wrong. Very wrong. And anyone who can think for two damn seconds would know it's wrong. You don't need immunity for obeying a court order. Because if you get a court order, you pretty much have to obey (or end up in court). But more to the point, this whole section is about "voluntary actions". Obeying a court order is not a voluntary action. If this section were just about cases where there's a court order, then it wouldn't make any sense at all. It clearly applies to voluntary actions outside of a court order.

The response from SOPA defenders was painful in its cluelessness. Rep. Watt more or less admitted that he thought Polis' interpretation was wrong, so he wouldn't support the amendment. That makes no sense. If Watt thinks the language already says that, what's the harm of clarifying that with the text of the Polis amendment? It makes no sense to refuse to do so. And if Watt and Deutsch really believe that the meaning of 105 is clear and doesn't need any amendments to clarify, they might want to talk to some actual legal experts, because they're analyzing the bill and reading it to say exactly as Polis interpreted it. And since this is a private right in the bill, if lawyers are already interpreting it that way, that means it'll get used that way. So why not clarify? It's mind-boggling.

Perhaps even more ridiculous was Rep. Howard Berman, who, in trying to agree with Watt and Deutsch, made the exact opposite argument and actually agreed with Polis, while claiming he didn't and using that agreement as a reason to vote against the amendment! I'm not joking. Berman pointed out that, contrary to Deutsch and Watt's claims, it made no sense to have an immunity section that only dealt with court orders for all the reasons we listed above. Basically, while Deutsch and Watt pretend that the section requires a court order, Berman proves that it doesn't... and then says that's why he's voting against the amendment. It really was a head smashing moment.

In the end, despite vigorous attempts by Polis and Rep. Lofgren to explain why this was so problematic, the Committee basically just ignored the whole thing and rejected the amendment. End result: SOPA 2.0 contains a crazy scary clause that's going to make it crazy easy to cut off websites with no recourse whatsoever. And this part isn't just limited to payment providers/ad networks -- but to service providers, search engines and domain registrars/registries as well. Yes. Search engines. So you can send a notice to a search engine, and if they want to keep their immunity, they have to take the actions in either Section 102(c)(2) or 103(c)(2), which are basically all of the "cut 'em off, block 'em" remedies. That's crazy. This basically encourages search engines to disappear sites upon a single notice. It encourages domain registries to kill domains based on notices. With no recourse at all, because the providers have broad immunity.

It's this kind of insanity that should terrify people about this bill moving forward.

See the update at the end

The legal fight between Megaupload and Universal Music Group keeps getting more and more... odd. After the court gave UMG basically a day to respond, the company filed its response and made a rather surprising point: that a deal with YouTube/Google lets it take down videos it has no copyright over. This seems odd, and lots of people are screaming about some crazy clause that lets UMG censor anyone's videos. But I think I understand what's going on here -- and it's a very specific situation, where UMG sorta used a loophole -- so read on for the details. UMG is still being questionable, sleazy and short-sighted... but probably legal.

The key part of the company's legal response likely is accurate and probably kills MegaUpload's case. There are a few different ways that content can be taken down off of YouTube concerning copyright claims. One is via ContentID, the automated system that matches fingerprints. One is via a DMCA takedown notice. And one is via YouTube's Content Management System. This last one doesn't get much attention and isn't that well known, but it's basically halfway in between the other two (loosely speaking), granting partners the ability to spot and block videos that aren't matched by ContentID, but without sending a DMCA takedown. If you're familiar with the details of the system (which it appears MegaUpload and its lawyers were not), it was actually easy to tell this was a CMS block by the message that appeared on the blocked video. It said "This video contains content from UMG, who has blocked it on copyright grounds." That's the message that shows up on CMS blocks. DMCA takedowns say that the video is "no longer available."

So, on that point, UMG may very well be correct in its filing, that it's not subject to DMCA sanctions because it didn't actually file a DMCA notice. This is kind of a weak excuse, frankly, and really calls into question how YouTube's CMS system works, more than anything else. In theory, this also means that the only retribution that can happen for UMG wrongly taking down the videos of others is that Google cuts them off. But seeing as Google has a big partnership with UMG to build and run Vevo, that's unlikely to happen. That's a bit scary, but it suggests UMG more or less has a free pass to shut down certain videos it doesn't like without much recourse (well, beyond public ridicule).

That said, a part of UMG's explanation isn't entirely clear, but I have some guesses as to what happened. UMG claims that its agreement with YouTube goes beyond just copyright, and that it's allowed to pull videos for other (unnamed) reasons. This is new, in a sense, because YouTube has always suggested that CMS is for copyright issues -- and, in fact, the original message on the video, did, in fact, say that it was a copyright issue. YouTube later changed that message to say it was a terms of service issue. And that provides a clue.

I believe that part of the Vevo agreement is that UMG gets to "pull" videos of its own artists from YouTube for the purpose of putting them on Vevo. That's the intention anyway. I know when Vevo launched, that was part of the deal. All the YouTube videos of UMG artists magically jumped over to Vevo. So, I'm guessing that UMG basically used this loophole, which was supposed to be about taking videos off YouTube for the purpose of putting them on Vevo, and realized it could just "take the videos off YouTube" as long as they had UMG artists in them, without ever putting them up on Vevo.

In other words, due to the specific nature of the Vevo agreement -- which was intended to move videos from YouTube to Vevo -- UMG can pull videos that show its artists off of YouTube. Of course, in this case, it used it for an entirely different purpose, which was to try to censor this ad. That backfired in all sorts of ways, and it sounds like YouTube told UMG to knock it off, knowing that this was not the intention of the agreement at all. And, for what it's worth, UMG has stopped getting the video blocked, and says it will allow it to stay up for now.

This situation is messy and silly, but it seems like an unintended result of contract language over Vevo that UMG exploited. It may be legal, but in the end, it was pretty dumb by UMG. This whole thing, in true Streisand Effect fashion, actually drove a lot more attention to the ad. And even if it was legal, it sure makes UMG look petty and vindictive.

Update: Received a response from a YouTube spokesperson which makes this a little more interesting.

Our partners do not have broad take-down rights to remove anything they don’t like from our service. In limited cases, if they so choose, and based on exclusive agreements with their artists, partners can take down live performances.

That confirms some of what I thought: that UMG does not have the right to take down any videos (as people keep implying), but that it may be able to take down some videos. The new bit of info is that it's just live performances. So, that would suggest UMG is even slimier. They tried to claim that those video clips of artists in the MegaUpload song were "live performances." That's clearly bogus.

Update 2: And... MegaUpload has conceded that its restraining order request is moot, and so the judge has denied it (pdf), while giving the company the right to file for a preliminary injunction and for discovery. So, not much of anything, but the case will likely continue.

So, if you weren't paying attention, yesterday was a marathon session of SOPA amendments... It ran for 11.5 hours, with just one tiny break, and it looks like they didn't even get through half of the amendments. I'll get into some more details in a bit, but honestly the single best description of the insanity of these hearings came from The Washington Post's Alexandra Petri, who called them "nightmarish."

If this were surgery, the patient would have run out screaming a long time ago. But this is like a group of well-intentioned amateurs getting together to perform heart surgery on a patient incapable of moving. “We hear from the motion picture industry that heart surgery is what’s required,” they say cheerily. “We’re not going to cut the good valves, just the bad — neurons, or whatever you call those durn thingies.”

This is terrifying to watch. It would be amusing — there’s nothing like people who did not grow up with the Internet attempting to ask questions about technology very slowly and stumbling over words like “server” and “service” when you want an easy laugh. Except that this time, the joke’s on us.

That really describes the situation perfectly. Over and over again the people in favor of this bill flat out admitted that they didn't understand the technology -- and when the various people opposed to it asked why don't they get some experts in to answer some questions, the supporters had no credible response. The DNS and security aspects were completely brushed aside. As Rep. Jason Chaffetz (who is fighting the good fight against this) pointed out repeatedly, there's simply no reason to rush this bill when there are such widespread concerns about it and no one has taken the time to get the answers to key questions.

But the supporters of the bill -- mainly Reps. Lamar Smith, Bob Goodlatte and Mel Watt -- simply wanted to push forward at all costs. They rejected every amendment raised, except two minor ones (we'll get to that in a minute). Amazingly they rejected all sorts of quite reasonable suggestions -- while complaining that those opposed to the bill never had any suggestions to fix it! And yet when those actual proposals were brought up, they were rejected out of hand. It really was pretty disgusting. Goodlatte's responses struck me as particularly inane. He kept rejecting amendments because he feared that the amendment could be abused. The fact that most of those amendments were to prevent the much wider scale abuses guaranteed under SOPA never seemed to occur to him.

In fact, supporters of the bill regularly used arguments that actually could have been turned around on them. They refused an amendment from Rep. Darrell Issa to limit the powers of the bill to those who actually were in the US, saying that it would set a bad precedent for countries like China... and this came just after they were totally outraged that anyone might think that the entire bill itself sets a bad precedent for countries like China. The disingenuous bullshit was really ridiculous.

Rep. Watt was particularly keen to display his own ignorance. He regularly admitted that he wasn't very knowledgeable on technology -- which should have been a reason to recuse himself or to at least ask for more info from experts. Instead, he just insisted that all of the technical experts were simply wrong. Based on what? Nothing. How does someone like Watt get elected when he appears to want to regulate the internet based on pure faith and against what every single expert has said? It's downright scary.

Later, Watt angrily rejected an amendment to clarify some language to make sure it was limited -- by saying that he believed the language already said what the amendment added. If that's true, why reject the amendment? All it would do is make the intent clear. Instead, he said no. That makes no sense at all.

What was clear, from the beginning, was that the SOPA supporters were not there in good faith. They had no intention of listening to reasonable suggestions to fix the bill, and stuck together as a bloc to reject pretty much all of them -- even while admitting their own ignorance. The really sad part was when Goodlatte tried to equate the views of a couple of policy analysts who get money from the entertainment industry, with the views of nearly 100 independent internet engineers who have pointed out how problematic SOPA really would be. Watt and others tried to pretend that because each side could turn up someone who would say something that those views were equal. It's the insane Congressional equivalent of "he-said/she-said" journalism, where you "hear" both sides, but never seek out the truth. That's nuts.

The simple fact is that nearly every single actual credible internet engineer has come out against these bills. There isn't an equivalence where each side can turn up a few people. The scales are completely weighted down against the bills... and many of those people have no associations whatsoever -- even as SOPA defenders insisted that only "Google" experts were against the bill. Stewart Baker isn't speaking for Google. Sandia National Labs isn't speaking for Google.

The real insanity is that supporters of the bill are rushing forward just because they want to pass "something," and they don't seem to care about the consequences.

As for the two amendments that did pass, one was to say that if you "knowingly misrepresented" a claim on a site, you had to pay attorneys' fees. Of course, "knowingly misrepresent" is a very, very high bar that will almost never be met. A similar amendment by Rep. Chaffetz that would also require fees if you failed to get an injunction in court was rejected, because SOPA supporters were worried this would scare people off. As Chaffetz pointed out: that's the whole point. It would scare off those who don't have strong, legitimate claims.

The other amendment that passed right at the end, was from Rep. Jared Polis, requiring the State Department to do a study on the eventual impacts of SOPA. That doesn't change the law really. It just will at least let people check back in on the damage it does a couple years from now.

A few other key points:

• Huge kudos to Reps. Issa, Lofgren, Chaffetz and Polis, who combined to repeatedly point out the problems of the bill and to argue forcefully and compellingly about why we needed to fix these problems. That much of the rest of the Committee ignored these concerns, played them down, or rejected them for silly or nonsense reasons, is really just a statement on the sad state of Congress today.
• I heard from sources that a big time content industry lobbyist was seen hanging out in the "members only" area during the session. If that doesn't tell you everything you need to know about what's going on, then you're not paying attention.
• There was a bizarre elementary school-like fight that went on at one point. Rep. Steve King tweeted early on:

  We are debating the Stop Online Piracy Act and Shiela Jackson has so bored me that I'm killing time by surfing the Internet.

  Rep. Jackson-Lee found out about this and announced that she was "offended," at which point it seemed like a bunch of these old clueless men started arguing about how inappropriate it was for her to say she was offended. The whole session had to pause while they talked to a "parliamentarian" about whether it was okay to use the term "offended," eventually leading Jackson-Lee to change her statement. Yeah. These are the people in charge of making our laws. Scary.
• With the session going on for 11.5 hours, there was a short break for lunch, but for dinner Rep. Lamar Smith offered "four kinds of pizza," but apparently only for other members. Staffers had to sit and starve. Nice of them, huh?

All in all, the process should leave you frightened for our country. This was not an attempt to fix a broken law. It was an attempt to please some Hollywood funders at the expense of innovation and jobs. It's insanity.

That said... if you want to watch more of it today, tune in either at the Judiciary website or the KeepTheWebOpen site and make sure you have a pillow nearby for when you want to bang your head on the desk or wall. Once again, I'll be live-tweeting some of the hearing (don't think I can make all of it) from my personal Twitter account.

Amazon has faced controversy in the past. They've been involved in ongoing state sales tax disputes, mostly brought on by people who can't figure out what it means to actually have a corporate presence within a state. There have been patent disputes over one-click technology. Even issues of working conditions have raised their ugly heads. But now we will witness the most evil action ever by Amazon: price advertising.

Yes, according to a Huffington Post piece, we learn that Amazon is seeking to make lower priced versions of retail goods easier to find for customers. They've released their Price Check App for smartphones. You'll never guess what it does...it does price comparisons for you! It works like many similar apps, utilizing the phone's camera to scan the barcode of items in retail stores and then listing any identical products and their price through the Amazon online store. Fortunately, we consumers have a savior from this superevil, money-saving device that certainly isn't the first of its kind.

Yes, retail bookstores, in what may be the single most backward thinking request of all time, are asking the general public (i.e. customers) to boycott Amazon due to the release of this phone app. For those too busy playing solitaire to really think this through, let me break this down for you. Amazon can offer goods at lower prices than many retail stores, they release an app that allows consumers to verify whether that's the case on an individual product, the customer stands only to save money through this app, and retailers are asking customers to boycott the company saving them money over it. It'd be like boycotting a doctor for offering a cancer cure because, well, what about all the other doctors who have been making money offering chemo treatments?

Now for the fun part. Some quotes from the article.

"This Saturday, Amazon will offer Price Check customers an extra incentive: up to five dollars off products whose barcodes are scanned using their app. The effect of this is to encourage consumers to use their local brick-and-mortar stores as "showrooms," while not spending money supporting them."

Gasp! Encouraging folks to browse stores for items and then price shop them to get the best deal? And, more to the point, actually providing the consumer with the tools to do so? It's like something Lex Luthor would do! Where the hell is Superman to stop this dastardly customer-friendly company?

"David Didriksen, president of Massachusetts-based Willow Books & Cafe, told Publishers Weekly that the offer is “another in a long series of predatory practices by Amazon. You would think that a company of that size would be willing to just live and let live for small retailers who can’t possibly affect them. But, no, they want it all.”

Uh oh. Apparently Superman got hit one too many times in the head. What does the size of a company have to do with anything? Either you can compete with them, or you can't. And here's a fun question: what competitive act has a company ever taken in the existence of business that couldn't be called "predatory" by its competition? And, to put the ridiculous cherry on top of this nonsense sundae, Amazon's $5 off offer doesn't even apply to books!

Maine Senator Olympia Snow, seeing something grand and wishing to stand on it, called on Amazon to cancel the promotion because "paying consumers to visit small businesses and leave empty-handed is an attack on Main Street businesses that employ workers in our communities.”

First, Amazon isn't paying them to leave a shop empty-handed, they're promoting their new phone app and offering a discount on purchases made using it. Secondly, Amazon employs folks too, the overwhelming majority of them in the United States, so put the jobs nonsense aside as well. Maybe we should go back to bookstore owners to find a real idea on how to compete with this app.

"Meanwhile, Third Street Books in McMinnville, Oregon has chosen to mark Amazon's Price Check offer with a counter offer of their own: on Saturday, customers will get 15 percent off their purchase, plus a $5 gift certificate. All they have to do is provide proof that they have cancelled their Amazon account."

Uh huh. Let's ignore the fact that Amazon provides much more than books, so your coupon doesn't have all that much value over an Amazon account. Let's ignore the fact that there are several other barcode scanning price check apps already on smartphone markets. Let's ignore the fact that Amazon's $5 promo doesn't apply to books. Let's ignore the fact that, even if we grant that droves of customers are going to spend hours mulling through retail bookstores scanning book after book after book, don't folks do the opposite all the time? Who doesn't browse or search products online and then go buy them retail, either for convenience, for atmosphere, or because they don't want to wait for the product to ship?

Perhaps its time local bookstores concentrate on what they can offer to compete with Amazon: their atmosphere. Not unlike the home-viewing vs. movie theater quandary, mom and pop bookstores can add value to the shopping experience. They can have staff picks of books, offer advice on purchases, offer reading clubs and writing classes, sell rare/used books, partner with food vendors for things like coffee, have book-signings, etc. So stop trying to convince your customers to boycott another company for making their lives better and start competing by also making consumers' lives better.

Last year, Sony removed the ability for all PS3 owners to install other operating systems onto its PS3 console. This came as a result of console modders attempting to use it as an avenue to jailbreak the console. As a result of the move, Sony received a lot of outrage from upset gamers. Part of this outrage was a class action suit brought on behalf of PS3 owners who felt they were cheated when they were forced to lose the OtherOS feature or lose the ability to access Sony's Playstation Network and the ability to play future games that require a connection and the latest firmware. Many gamers reacted as if this was little more than the gamer's version of 'Sophie's Choice'.

We now learn, via IGN, the presiding judge has dismissed the case against Sony. Back in February of this year, Judge Seeborg had dismissed all but one claim leaving the option for an amended complaint to be filed.

While it cannot be concluded as a matter of law at this juncture that Sony could, without legal consequence, force its customers to choose either to forego installing the software update or to lose access to the other OS feature, the present allegations of the complaint largely fail to state a claim. Accordingly, with the exception of one count, the motion to dismiss will be granted, with leave to amend.

The judge wasn't convinced by the latest amended complaint and has completely dismissed the case stating that the PS3 owners failed to convince him that they were entitled to the OtherOS feature or access to PSN outside the PS3's warranty period. That is an interesting point. Had the PS3's been within the warranty period, would this case have gone the other way? That is certainly something to consider. After all, the OtherOS feature was part of the whole PS3. However, even outside the warranty period, are we really to just accept it when a manufacturer deliberately disables a function?

Perhaps responding to just such concerns, Seeborg stated:

The dismay and frustration at least some PS3 owners likely experienced when Sony made the decision to limit access to the PSN service to those who were willing to disable the Other OS feature on their machines was no doubt genuine and understandable. As a matter of providing customer satisfaction and building loyalty, it may have been questionable.

A questionable move indeed. Sony may have dodged a legal bullet here, but the bullet of continued frustration that Sony customers have with this addition to many many questionable business decisions has hit it between the eyes. How much longer will Sony customers put up with this kind of abuse? What features will it cut next? While we don't know the answer to that, we do know one thing. Sony removed this functionality in order to prevent PS3 owners from jailbreaking it. However, if the EFF has its way this year, this dismissal will be moot.

The narrative around counterfeit goods usually ends with their seizure. We rarely get to hear or see what happens to them afterwards unless some token burning or breaking is laid on for the cameras' benefit. That makes the following story doubly noteworthy: we not only find out where fake designer clothes go after they have been seized in the UK, we discover that they are put to an excellent use:

Instead of handing counterfeit designer clothes to customs or trading standards to be destroyed, they are being donated to a charity for redistribution to the homeless and vulnerable.

That charity is called His Church, and in the last six years it has managed to convince 90% of British Trading Standards Authorities, which have the job of dealing with counterfeit goods, to pass on the clothes for patching – can't leave those labels visible – and then for redistribution. That's good for the homeless people that receive them, and it's good for the British government:

Every year customs and trading standards spend a fortune on storing fake clothes while waiting for a court decision, and then once the items have been proved to be fake the authorities have to fork out further for incineration or landfill costs.

His Church has removed all such costs and pass on the high quality goods to some 250 homeless centres and women's shelters across the country.

This is such an obviously sensible thing to do you have to ask why the same approach isn't more widely adopted. Presumably it's from some residual fear that allowing fake clothes to circulate will "confuse" customers.

But as Techdirt has noted before, it's likely that people know exactly what they are getting when they buy counterfeits, and that they are not confused in the slightest. Moreover, there's no evidence that the sales of genuine designer clothes in the UK have suffered over the last six years as a result of all these fakes being allowed on to the streets: were there any, the scheme would certainly have been halted by now. So is there any good reason why other homeless and vulnerable people around the world shouldn't benefit too?

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