[FYI] (Fwd) FC: Software group to Hollings: We don't want your CBDTP bill!

["Axel H Horns" <horns@ipjur.com>]

------- Forwarded message follows -------
Date sent:      	Tue, 30 Apr 2002 17:57:20 -0400
From:           	Declan McCullagh <declan@well.com>
To:             	politech@politechbot.com
Subject:        	FC: Software group to Hollings: We don't want your CBDTPA bill!
Send reply to:  	declan@well.com

Think of this as more evidence of the north-south California split.
Software companies and Hollywood liked the DMCA. The folks at SIIA
embraced it, as they acknowledge below, along with the RIAA and MPAA.
But the northerners break with the southerners over Hollings' CBDTPA.

Text of Hollings' Consumer Broadband and Digital Television Promotion
Act: http://www.politechbot.com/docs/cbdtpa/

Politech archive on the CBDTPA:
http://www.politechbot.com/cgi-bin/politech.cgi?name=cbdtpa

-Declan

---

From: "Richard M. Smith" <rms@computerbytesman.com>
To: <declan@well.com>
Subject: SIIA on the Hollings Bill
Date: Tue, 30 Apr 2002 16:22:38 -0400

FYI:

 http://www.siia.net/sharedcontent/govt/issues/ip/letter4-30-02.html

---


        Software & Information Industry Association - 1090 Vermont Ave
        NW
                                   Sixth Floor - Washington, DC 20005
                                   April 30, 2002

   The Honorable Ernest F. Hollings
   Chairman
   Senate Commerce, Science and Transportation Committee
   United States Senate
   Washington, DC 20510

   Re: S. 2048, Consumer Broadband and Digital Television Promotion
   Act

   Dear Mr. Chairman:

   The Software & Information Industry Association (SIIA) and its
   predecessor organizations have been fighting digital piracy longer
   than any other trade association in the world. During the 16 years
   we have combated digital piracy we have gained invaluable
   experience as to what anti-piracy policies are effective and what
   level and type of Government involvement is appropriate and
   necessary. Based on our years of experience in this area, we
   believe that S. 2048, the "Consumer Broadband and Digital
   Television Promotion Act," is bad policy and establishes
   unwarranted and intrusive level of Government regulation into the
   development of technology.

   S. 2048 would impose intrusive and unwieldy government regulations
   to the detriment of the copyright community, the high-tech
   community and consumers. The bill requires the government to be
   involved in every step of the process and gives the Government the
   ultimate say in determining what Digital Rights Management (DRM)
   standards will be adopted and how they will be implemented today
   and into the future. This is SIIA's most pressing concern with S.
   2048. The marketplace - not the Government - should determine who
   the winners and the losers in the DRM space are. Only through
   competition in the DRM industry and the stakeholders working
   together to develop mutually acceptable standards for DRM solutions
   to the piracy problems will we get the best DRM technology
   solutions. We, therefore, strongly urge you to oppose S. 2048.

   SIIA is the principal trade association of the software and
   information industry. We represent about 800 high-tech companies
   that develop and market software and digital content for business,
   education, consumers, the Internet and entertainment. SIIA resulted
   from a merger of the former Software Publishers Association (SPA)
   and the Information Industry Association (IIA) in January 1999. In
   1985, SPA began a comprehensive, industry-wide effort to fight
   software piracy. Through the years, as technology and business
   practices have changed so has our approach to anti-piracy
   activities. Today, SIIA conducts a wide range of anti-piracy
   activities, including litigation, end-user education and the
   development of software management tools.

   SIIA has long been an advocate for strong intellectual property
   protection. For years, we have pushed for Congress to enact laws
   that help us effectively combat rising piracy rates throughout the
   United States and abroad. Most recently, SIIA supported
   Congressional passage of the Digital Millennium Copyright Act
   (DMCA) in 1998 to help SIIA and its members, and other copyright
   owners, fight new forms of digital piracy. During deliberation of
   the DMCA, Congress, as well the Administration and the
   stakeholders, rejected proposals that would have required
   technology producers and service providers to incorporate
   unilaterally-adopted security technologies into their digital
   products and services. As evidence of this, section 1201(c)(3) of
   title 17, United States Code, includes a provision that makes clear
   that the DMCA does not, as a general rule, "require that the design
   of a consumer electronics, telecommunications, or computing product
   provide for a response to any particular technological measure "
   that is unilaterally adopted. This is often referred to as the "no
   mandate" provision of the DMCA. Of course, this "no mandate"
   provision does not prevent the high-tech and content industries
   from working cooperatively to develop guidelines or rules for
   incorporating "standard security technologies" into their digital
   products and services to protect against piracy. But S. 2048 goes
   too far by requiring that no "digital media device" be sold or no
   "interactive computer service" be used unless security technologies
   are incorporated into such device or service.

   Although technologically much has changed since the DMCA was
   enacted in 1998, the reasons for including this no mandate
   provision and not burdening technology producers and service
   providers are still true today. What Congress rejected in 1998 as
   bad policy, remains bad policy today. Nothing has changed to
   warrant a wholesale reconsideration of these issues or to warrant
   undoing the compromise reached in the DMCA. In short, there is no
   reason to reverse course on this very important and complex issue
   by imposing on the high-tech and copyright industries the
   government-created and imposed standards required by S. 2048.

   In addition, it is also significant to understand that the DMCA is
   still very much in its infancy. We are just beginning to see
   companies incorporate the technological protections afforded by
   section 1201 and 1202 of the DMCA into their business models to
   create new and unique ways for getting their products and services
   to their customers. We are just beginning to see the DMCA (and the
   Copyright Act) being used in the civil and criminal context to
   effectively shut down well-known digital pirate operations and to
   see the courts apply and interpret provisions of the DMCA and
   determine how these provisions will apply to different authorized
   and unauthorized business schemes. And perhaps, most significantly,
   we are just beginning to see the public availing themselves of
   products and services made available because of the technological
   protections afforded by the DMCA. It would be premature to enact
   any legislation for the purpose of promoting broadband, digital
   television or any other nascent digital distribution mechanism
   until there is an opportunity for the DMCA to get its "sea legs"
   and to fully understand the impact that the DMCA has had on piracy
   and the marketplace for copyrighted content (or until such time as
   collective agreement is reached by the stakeholders on the
   appropriate and necessary technological solutions).

   One significant problem with S. 2048, among many, is that it fails
   to recognize that the marketplace - not the Government - is the
   best way to develop the technological solutions to the specific
   piracy problems related to promoting broadband and digital
   television. With vast technological changes taking place over the
   past few years, new markets and business models for digital goods
   and services that take advantage of the Internet and other advances
   in digital technologies are just beginning to take root. With each
   passing day, the Internet provides consumers with more options,
   more alternatives and more opportunities than ever before. It has
   only been in the last several years that consumers could tap into
   the vast resources increasingly available on public and private
   networks. And it is only in that short time frame that businesses,
   schools and universities, and individuals have begun to provide a
   wide range of copyrighted products and services to previously
   unreachable audiences.

   With business models evolving so rapidly, it would be unwise to
   attempt to craft a new and complicated framework of
   government-imposed mandatory security measures, as S. 2048 attempts
   to do, merely to address concerns that are likely to be rapidly
   addressed as the marketplace for copyrighted works and anti-piracy
   technologies evolve. For example, of the three piracy problems that
   S. 2048 attempts to address, we understand that two of them -
   preventing free digital television broadcasts from being illegally
   redistributed and preventing analog outputs from digital devices
   (i.e., filling the "analog hole") - are well on their way to being
   resolved by the stakeholders. Of course, once these issues are
   resolved by the private sector, limited government involvement may
   - at that time - be appropriate to promote confidence that
   technological solutions agreed to by the stakeholders can be
   enforced to combat piracy problems. As to the third piracy problem
   - halting the illegal distribution of copyrighted works that occur
   through the misuse of peer-to-peer file sharing systems- this is a
   very complex problem that is not easily solved, and that would not,
   in any event, be resolved by imposing S. 2048-like
   unilaterally-imposed, government-created security standards on
   software, hardware and service providers.

   Government intervention in creating, imposing or approving a
   security standard is not the solution to the industry's piracy
   problems. The high-tech industry has worked with the content
   community to reach consensus on ways to address similar piracy
   problems in the past. Given sufficient time, there is no reason to
   think that the stakeholders cannot again reach consensus on ways to
   combat the three specific problems identified at the hearings on
   the bill. These problems are relatively new and complex. There is
   no one-size-fits-all solution. Only through DRM companies competing
   and working together with content companies can effective solutions
   be found. Government-mandated regulation will not solve any
   problems - it will only create new ones.

   The Government decision-making process is inherently ill-equipped
   to effectively address the types of issues raised in the
   piracy/broadband debate. The process is slow and unwieldy. The
   Government will not be able to keep pace with the rapid changes in
   technology - virtually assuring that any standard the Government
   codifies is outdated the moment it becomes law. In short, it is
   SIIA's view that many of the aforementioned piracy problems can and
   will be solved chiefly by technological solutions developed by the
   stakeholders. To the extent there is a role for the Government
   here, the role should be to provide a means for enforcing these
   solutions.

   The history of the software industry has shown that the answer to
   most piracy problems lies principally in the stakeholders and the
   marketplace developing technical and business solutions in
   conjunction with Congressional recognition of these solutions by
   enacting laws to provide remedies against those who contravene
   these solutions. For example, about twenty years ago, anti-copying
   mechanisms were incorporated into software to protect against
   unauthorized copying of the software. Eventually, consumers
   complained that such mechanisms made the software unduly difficult
   to use. The industry listened to its customers and responded by
   discontinuing its use of anti-copying technologies incorporated
   into the software and seeking out other ways to protect against
   piracy of software. As a result, many software companies moved to
   different distribution business models, such as site licenses and
   shrink-wrap licenses, and different technological protections, such
   as passwords, registration numbers, encryption and dongles1, to
   protect their copyrighted software from piracy. The marketplace
   largely accepted these approaches and eventually, with the
   anticircumvention provisions (i.e., 17 U.S.C. 1201) of the DMCA and
   related laws, Congress provided copyright owners with the tools for
   enforcing these marketplace solutions. Make no mistake about it,
   although these solutions and the laws that protect them are
   effective, the software industry still suffers significant harm
   from piracy. Nevertheless, the software industry has been able to
   move forward without the need to resort to Government-created and
   imposed standards in the area of anti-piracy technologies. We
   should learn from this history, not ignore it as S. 2048 does by
   imposing government standards on the industry before the
   marketplace formulates its own solutions.

   In addition to the Government intervention problems discussed
   above, we have numerous other concerns with S. 2048. For example,
   the bill is needlessly overbroad in its subject matter coverage.
   The bill is not limited in its application or effect to broadband
   technology or digital television. In fact, it is not limited at all
   - it applies to just about all hardware and software. For example,
   the bill covers PCs, PDAs, software, Internet services, and
   consumer electronic products irrespective of whether these products
   or services are associated with broadband or digital television. It
   is also much too broad because it covers all content by failing to
   distinguish between audiovisual content and non-audiovisual
   content; between copyrighted and noncopyrighted content; and
   between pirated and authorized content. If the bill's aim is to
   promote broadband and digital television then it should be narrowly
   tailored to address these areas.

   Another extremely significant concern we have with S. 2048 is that
   it prevents copyright owners from using technology to fully protect
   their works - thereby undermining what appears to be the very
   purpose of the bill. The bill makes it illegal for copyright owners
   to use technological protection to prevent lawful recipients from
   making "personal use" copies even when there is a legitimate
   purpose for using such technological protections, such as to
   enforce agreed upon contract terms or to protect trade secrets or a
   patent. It would also make it illegal for copyright owners to use
   technological protection to prevent lawful recipients from making
   "personal use" copies even when the making of the copies is not a
   fair use or would otherwise violate the Copyright Act.

   These are just a sampling of the problems with the approach taken
   in S. 2048. There are many other concerns SIIA and other
   stakeholders have with S. 2048. For the reasons stated above and
   the other concerns we have not specifically delineated here, we
   strongly urge you to oppose S. 2048.

   If you have any questions or comments about S. 2048 or our comments
   above, please feel free to contact either Mark Bohannon (SIIA
   General Counsel & Senior Vice President Public Policy at (202)
   789-4471 or mbohannon@siia.net) or Keith Kupferschmid (SIIA Vice
   President of Intellectual Property Policy & Enforcement at (202)
   789-4442 or by e-mail at keithk@siia.net).

                                   Sincerely

                                   Ken Wasch
                                   President
                              Software & Information Industry
                              Association

   Cc: Members of the Senate Commerce Committee
     _________________________________________________________________

   1. Dongles are used by software vendors to authenticate users' PCs
   and prevent unauthorized use. This type of DRM system requires that
   users install special devices in their PCs or in some cases
   purchase PCs with such devices pre-installed.



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