Hollywood Writers & Copyright Scholars Point Out That Piracy Fears Over Open Set Top Boxes Are Complete FUD

from the you-tell-'em dept

We've been covering for a while the ridiculous ongoing fight about the FCC's plan to open up the set top box market to actual competition. Historically, we've always seen that when closed technologies are opened up, it generally leads to much more innovation that benefits everyone. But the big cable companies are freaking out, because locked set top boxes are a huge moneymaker for them: they get customers to "rent" those cable boxes for an average of $230 per year. The industry, as a whole, takes in approximately $20 billion from set top box rentals alone. And they can only do that because the market is locked down. And the cable companies don't want to give that up.

They've been trying various strategies to kill off the FCC's plans, including the ridiculous, but frequently used, argument that opening up set top boxes will harm diversity (the opposite is actually true, but... details). But a key vector of attack on this plan has been to convince their buddies at the MPAA that open set top boxes are just another name for piracy. They've convinced some truly confused Hollywood types to freak out about more innovation in set top boxes meaning more piracy, leading to a series of similar op-ed pieces showing up basically everywhere. And those op-eds have influenced some of our clueless lawmakers too, who are now asking if open set top boxes will lead to a Popcorn Time revolution.

As we've explained over and over and over again, these concerns are complete bunk. The proposal has always made clear that cable providers will still be able to "determine the content protection systems it deems sufficient to prevent theft and misuse, and will not impede the introduction of new content protection systems." In other words, these other boxes will still be encumbered with DRM (as bad an idea as that is...).

Thankfully, now a new flurry of "response" comments have come in and people are pointing out just how wrong the "OMG piracy!" comments are concerning set top boxes. First up, some actual copyright law professors -- including Pam Samuelson, Peter Jaszi, Annemarie Bridy, Betsy Rosenblatt and Rebecca Tushnet, along with Mitch Stoltz from EFF -- have filed a response pointing out that the concerns about piracy from open set top boxes is not particularly accurate. First, they point out that it's not the FCC's job to protect a particular business model of legacy industries, and that the intent of copyright law is, once again, to benefit the public. And it seems like an odd way to do that by locking up set top boxes. They also take issue with the idea that because someone might potentially view infringing works via a set top box, it makes that an issue that (1) the FCC should even care about or (2) that is really about set top boxes at all:
Copyright does not confer a general right of commercial exploitation or “use” of a work. Thus, products and services that touch copyrighted works do not infringe copyright, and do not require a license, except to the extent that they implicate one or more of the exclusive rights. A television set is worthless without video programming to view, and a home audio system has little purpose without music. One could argue that the commercial value of these devices derives from the copyrighted works they touch. Following that reasoning, the sale of TVs and home audio equipment could be deemed a commercial exploitation of copyrighted works. But because these devices don’t ordinarily reproduce, distribute, or publicly perform works (let alone meet the rigorous standards for establishing secondary liability under copyright law), the law does not give copyright holders any right to prohibit their use and sale, dictate their design, or demand royalties.
They further point out that the set top boxes themselves are clearly not infringing anyone's copyright, no matter how much the MPAA and its friends have been repeating this myth. In some sense, the comment suggests that the MPAA is trying to roll back the famed Betamax decision that legalized the VCR (and, I should add, provided a massive new revenue stream for Hollywood).
Commenters in this rulemaking have characterized the proposed use of third-party devices or services to access pay-TV programming with terms such as “exploit[ing],”7 “repackag[ing],” “convey[ing]” copyrighted works to a third party, and creating “new uses on new platforms.” They imply that these activities constitute copyright infringement, or that the Commission should prevent these things regardless of whether they constitute infringement. These terms confuse rather than clarify the issue, because most of the activities they describe are not copyright infringement.

For example, a set-top box or other consumer device that receives TV programming in the home and displays it to the user does not inherently perform or display that programming publicly, nor does it distribute copies of the programming. While such a device is likely to make transitory, internal reproductions of programming in the process of displaying it to the user, such reproductions are not copies for purposes of the Copyright Act.

A set-top box or service might also make long-term personal copies of programming for the customer to watch later, much as a videocassette recorder does. This is firmly established as a fair use, including in systems where the recording is stored at a central facility.
They also use the infamous lawsuits against the Dish Hopper system to remind the FCC that the MPAA and its friends have, shall we say, a rather long and sad history of exaggerating claims to say that basically any new consumer friendly innovation is automatically copyright infringement if it happens to impede their chosen business model:
Such devices and service arise with some regularity, and their status is resolved either through litigation or licensing. For example, several programming providers sued Dish Networks, accusing its Hopper DVR and PrimeTime Anytime service, which skipped commercials upon playback, of causing infringement. After a court ruling that the core features of the device and service did not infringe, Dish reached settlements with most of the rightsholders in which the company agreed to limit the functionality of the service.
Meanwhile, in what might seem like a surprising source, another group calling bullshit on the MPAA is the local Hollywood writer's guild, the Writers Guild of America, West. Their full filing is totally worth reading. They basically make the exact point we've made for years: every time the MPAA fears some new innovation, it's not just wrong, but it often misses how that new innovation actually helps Hollywood in addition to the public:
It is often the case that when new technology emerges incumbent providers make alarmist predictions about guaranteed harms resulting from these innovations. While some concerns may be reasonable, the overwhelming majority of outlined harms are never realized. As CBS Chairman and CEO Les Moonves said in 2015, “All these technology initiatives that supposedly were going to hurt us have actually helped us. SVOD has helped us. DVR has helped us. The ability to go online with our own content, CBS.com, and the trailing episodes – all have helped us.” With the entertainment industry currently dominated by a handful of companies that have never been more profitable, it is clear that new technology and forms of content distribution have helped, not hurt the industry.

While new technology can create some business uncertainty, there is strong evidence that pro-consumer developments that make legal content more accessible to viewers benefits both consumers and content creators.
And then they point out that open set top boxes, combined with an open internet, are almost certainly a good thing:
Like all other entertainment industry participants, WGAW has strong incentives to protect the health of the business. WGAW members are the creators of intellectual property and their livelihoods depend on the ability of studios to license programming for initial exhibition and generate revenue in secondary markets. As such, WGAW and its members do not take concerns regarding piracy lightly. WGAW has consistently advocated for reasoned measures to protect copyright and address infringement. But WGAW members are also strong proponents of market competition, because it leads to more and better choices for consumers and more and better opportunities for writers. WGAW’s position seeks to strike a balance between these objectives, and led to our support for strong Net Neutrality rules and, ultimately, the need to reclassify broadband Internet access services under Title II of the Communications Act. In our advocacy, we were clear that Net Neutrality rules could protect Internet openness without jeopardizing content, as the rules applied only to lawful content, and outlined ways to address piracy that would not harm a free and open Internet. We believe the developments resulting from the open Internet, primarily the growth of a robust online video market, demonstrate the success of a balanced approach. The online video market generates significant revenues for media companies and residuals for writers through the licensing of television series and feature films and is projected to see upwards of 100 professional scripted series released for initial distribution on subscription online video distribution (“OVD”) services in 2016. We believe a similar balance can be achieved in the Commission’s proposed rules. Reasonable concerns can be addressed. Content can be protected while competition is promoted.
They also point out that they're totally against piracy -- in fact, they argue that limiting piracy is important to their careers -- but they don't see how these open set top boxes will actually increase piracy, especially when it will likely create tons of other benefits.
WGAW strongly agrees with the need to protect content and to limit piracy. No less than our members’ livelihoods depend on it. However, WGAW believes that a competitive navigation device market can and will protect content and, consistent with our position in Net Neutrality, we approach the proposed rules by assessing the likely benefits of competition and the risk of piracy. We find that the risks of this proposal are no greater than those presented by an open Internet, where there is strong evidence of a flourishing legal market that is very attractive to consumers.
There's a lot more good stuff in the full filing. Once again, the Writers Guild of America is one of the few voices that rises out of the Hollywood ecosystem that actually looks at the larger picture and how an open internet benefits everyone. In the past, the same organization came out against SOPA, in favor of better copyright law (as opposed to increased enforcement) and (as mentioned in the quoted portions above) in favor of net neutrality (while much of Hollywood opposed it). Kudos to the folks at the Writers Guild for taking a more accurate and holistic view of these issues, as compared to so many others.


Filed Under: competition, copyright, fcc, innovation, piracy, set top boxes
Companies: mpaa, writers guild of america west


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  • icon
    Jeremy Lyman (profile), 25 May 2016 @ 11:55am

    Good Ole Days

    Remember when you had to rent your telephone from the Bell Telephone Company to connect to the Bell Local System or long-distance? Now that was a good scheme. Why did they ever give that up? Oh right...

    reply to this | link to this | view in chronology ]

  • identicon
    Sean, 25 May 2016 @ 12:03pm

    Worrying about the wrong thing

    Cable companies worrying about continuing to be able to charge astronomical amounts for set top boxes. They need to worry about the thing that they keep denying is happening. Cord cutting!

    reply to this | link to this | view in chronology ]

    • icon
      Jeremy Lyman (profile), 25 May 2016 @ 1:21pm

      Re: Worrying about the wrong thing

      In their defense, it is a pretty fat fringe exploitation on their customers' bills, and almost no one complains. I remember being very surprised that you could bring your own cable modem ten years ago. But the motion on not renting TV hardware has been nonexistent as of yet.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 25 May 2016 @ 2:10pm

    "Open"

    It's not really an "open" box if it implements DRM. How about "third-party cable box" or "customer-owned" box?

    reply to this | link to this | view in chronology ]

  • icon
    David (profile), 25 May 2016 @ 4:42pm

    Doing my small part

    Comcast has billed me monthly for my personal cable modem. They refunded that charge while repeating the then company motto regarding supporting customers is number 1, or something like that.

    Next they informed me that my slow internet speeds might be a problem but they didn't have to respond because my cable modem is now end of life. And when they roll out the automatic update it will likely brick the device. So, hang up now, please sir.

    Just this week they sent me a notice that I am eligible for an upgrade to my cable modem. No kidding? Well, I might buy one with the several hundred dollars in savings from using their last one.

    I wonder what the cable modem numbers are if the settop box income ranks in at $20B?

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 27 May 2016 @ 7:28am

      Re: Doing my small part

      Rest assured, should the set-top box arena ever be opened up, the cable companies will immediately blame any and all service problems you may have on *your* equipment.
      Back when I had Comcrap, they once told me that a problem was because of the cable terminations and I would be charged to cut them off and replace them with the 'new' ones. I told them bullcrap, they were COMCAST cables! They did replace them, but didn't charge.

      reply to this | link to this | view in chronology ]

  • identicon
    MAFIAA, 25 May 2016 @ 4:53pm

    Without closed set top boxes, artists would not exist!

    reply to this | link to this | view in chronology ]

  • icon
    techflaws (profile), 25 May 2016 @ 10:16pm

    They've convinced some truly confused Hollywood types to freak out about more innovation in set top boxes meaning more piracy

    Please allow me to demonstrate:

    http://i390.photobucket.com/albums/oo350/jennifer-51/omg_onoz.gif

    reply to this | link to this | view in chronology ]


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