Internet, Record Labels, Technology
By Fred Von Lohmann, Senior Intellectual Property Attorney, Electronic Frontier Foundation
(This article is comment on the now milestone decision in the US by the Supreme Court regarding technology which has both infringing and non-infringing uses. This decision is paralleled in the UK in the case of CBS Songs v Amstrad. The EFF’s comment is made at the time of the current US appeal court hearing in the case of the MGM Studios v Grokster).
The MP3 generation may not remember it, but 20 years ago, Hollywood fell just one vote short of winning a ban on the VCR. This month marks the 20th anniversary of the Supreme Court’s 5-4 decision in Sony v Universal City Studios (1984), the case in which two movie studios asked the federal courts to impound all Betamax VCRs as tools of “piracy.”
Thankfully, the Supreme Court spurned Hollywood’s arguments, best summarized by Motion Picture Association of America chief Jack Valenti’s famous quote: “I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone.” The court decided that American consumers were not violating copyright laws when they time-shifted television with their VCRs. It also declared that Sony was not violating copyright laws by selling VCRs, even though some people might use them to infringe copyrights. In other words, you don’t go after the crow bar makers just because there are burglars out there.
In the 20 years since, we have learned two important lessons. First, new technologies and copyrights are complementary products in the long run. New technologies make copyrights more valuable because they unleash new markets and business models. That’s been the rule, without exception, for a century. The VCR ended up making Hollywood rich, with sales of pre-recorded cassettes quickly eclipsing the receipts from box office ticket sales. There’s no reason to think that the Internet won’t create even more revenue-generating opportunities.
Second, if you want a vibrant technology sector, you let the innovators invent without forcing them to beg permission from media moguls first. Sony didn’t ask permission to build the Betamax, and that’s what made the VCR possible. In fact, the Supreme Court’s rule set the stage for most of the amazing technologies we take for granted today. After all, would Hollywood have allowed the personal computer, if it had been asked? Would the recording industry have permitted hard drives? What about the book publishing industry and the scanner? And we know how these industries feel about the Internet. Fortunately, the rule in America is that innovators are beholden only to their customers and the marketplace, not to Disney or the Recording Industry Association of America. Unfortunately, the entertainment industries are trying to get the courts and Congress to forget these lessons. In cases involving peer-to-peer file sharing software, their lawyers hope that amid all the shouting about “piracy” they can persuade judges to make future innovators answer to movie moguls instead of the American consumer. Meanwhile, in Washington, they urge legislators and bureaucrats to put innovators under the thumb of government regulation.
In 1984, the Supreme Court spared Hollywood from its own short-sighted desire to curtail innovation. The legacy of that decision has been technology that benefits us all. Let’s hope that Congress and the courts have learned that lesson, even if the movie moguls haven’t.
On Tuesday, February 3, a federal appeals court will hear an entertainment industry appeal in MGM Studios v. Grokster, a case that will test the strength of the Supreme Court’s “Betamax” decision in the digital arena.
* Case: MGM Studios v. Grokster (case numbers 03-55894, 03-55901, and 03-56236) U.S. Court of Appeals for the Ninth Circuit: Judges: Hon. Robert Boochever, Hon. John Noonan, Hon. Sydney Thomas.
Synopsis: In April of last year, StreamCast (developer of Morpheus) and fellow peer-to-peer software distributor Grokster won a landmark victory against 28 entertainment companies when a federal court declared that the software distributors are not liable for copyright infringement by software users when the software had significant non-infringing uses. In ruling that file-sharing software deserves the same protection granted to the VCR or photocopier, the court relied on the 1984 Supreme Court decision determining that Sony could not be held responsible for copyright infringement by people who used Betamax VCRs.
Sony -v- Universal City Studios 104 US 774 (1984). The Court had to determine the legality of the Betamax machine which could both play pre-recorded films and videos legally and also could be used record infringing material illegally. The Court held on a 5-4 split that the machine was not illegal.
CBS Songs -v- Amstrad (1988) RPC 567 The House of Lords found that there was no infringement in the marketing of a twin cassette deck which clearly could be used for infringing purposes – copying music cassettes without permission
See the article ‘Don’t Shoot The Messenger – Copyright infringement in the Digital Age‘ by Ben Challis at: