How Copyright Has Driven Online Streaming Innovators Insane

Copyright

from the insanity-defense dept

A little over four years ago, we wrote about the Second Circuit appeals court’s ruling in the case over the legality of Cablevision’s remote DVR. As we said at the time, the court came to the right result — the remote DVR was perfectly legal — but had to twist itself into all sorts of crazy contortions to make that argument fit within the confines of copyright law. That’s because of the nature of copyright law itself, which is almost always reactive to technological changes and, because of that, always gets twisted up when important, useful and disruptive innovations come along. As we noted four years ago, copyright law “is simply not set up” to handle something like a remote DVR. Even though a home DVR is clearly legal, and the only real difference between one at home and one in the cloud is the length of the cord between the DVR and the TV, the legal arguments to make them both legal are quite twisted.

Since then, we’ve seen a whole bunch of startups try to offer variations of streaming video online — often relying on that quite twisted ruling in Cablevision. Each time we write about them — companies like ivi, Zediva and Aereo — we tend to note that all of them are doing incredibly inefficient and convoluted things on the back-end to try to stay within the confines of the law, as established by the Cablevision ruling. But to any objective observer considering what makes the most sense for a company and its users, all of the Rube Goldbergian designs of these companies seem entirely pointless. The goal is the same: to reasonably offer streaming services that match what people can do at home with a DVR or a DVD player — but it has to be twisted to make that work within the whacked out language of the law.

And that’s because the law is never written with innovation in mind. Quite the opposite. The history of copyright law is that every time something new comes along, Congress duct tapes on some new “right” to make it work. The 1909 Copyright Act was driven by the scary, scary invention of the player piano, which was going to wipe out the sheet music business or something. But the internet mucks with all of that — in part by bringing together different roles that had previously been separate. The end result is that different aspects of copyright law may or may not apply, depending on where you sit.

Law professor James Grimmelmann has picked up on this and written an absolutely brilliant piece over at Ars Technica, where he dives into the nitty gritty details of all of this to explain how copyright law for streaming went insane. Here’s the opening:

Suppose I could offer you a choice of two technologies for watching TV online. Behind Door Number One sits a free-to-watch service that uses off-the-shelf technology and that buffers just enough of each show to put the live stream on the Internet. Behind Door Number Two lies a subscription service that requires custom-designed hardware and makes dozens of copies of each show. Which sounds easier to build—and to use? More importantly, which is more likely to be legal?

If you went with Door Number One, then you are a sane person, untainted by the depravity of modern copyright law. But you are also wrong. The company behind Door Number One, iCraveTV, was enjoined out of existence a decade ago. The company behind Door Number Two, Aereo, just survived its first round in court and is still going strong.

The whole piece is totally worth reading. But it keeps going back to the same thing. Thanks to a combination of ridiculously antiquated copyright law and the 2nd Circuit’s right result-but-for-odd-reasons ruling in the Cablevision case, we have a ridiculous setup where no one ever seems to take into account just what’s happening for the end user, but rather focuses on the back-end to either jump through silly hoops (if you believe these services are legal) or to find questionable loopholes (if you’re a copyright maximalist) to try to show that your service is legal. The end result is not only very bizarre, convoluted and inefficient systems that make no sense, and which no sane person would choose to set up as a business, but also one where we just see an ongoing stream of wasteful legal battles.

In talking about Zediva — the company that set up individual DVD players in a data center which could stream only a single copy of an actual DVD playing at a time to a single user — Grimmelmann again notes that none of this makes any sense:

And once again, it’s a business model that would not exist in a world with copyright policy that was not demonstrably insane. Rapidly spinning optical discs make sense as a distribution technology because they’re compact and durable. But they’re a hassle and a half for playback, because they scratch, skip, and make random access a pain. If you’re going to use the Internet for distribution, better to take the DVDs out of the picture and use them as coasters. But since Cablevision had opened up what seemed like a gap in copyright law, Zediva poured shiny lacquered discs into the breach.

Is there a way out of this that doesn’t necessarily require a total dismantling of copyright law? Grimmelmann suggests that the more common sense (i.e., not insane) approach would be to actually look at what the end-user experience is:

Perhaps we can think about the problem of copyright on the Internet another way. Instead of asking which back-end technologies are legal, it might make more sense to ask what it is legal for users to do with computers on the front end. This approach would let people spend less time worrying about the exact definitions of “reproduction” and “performance” and more time thinking about users’ rights, especially under fair use.

Cablevision itself illustrates what might have been. The whole point of the RS-DVR was that it was a perfect substitute for a home DVR. Reasoning by analogy, then, we might say that the two ought to either both be legal or both be illegal. And since home DVRs seem here to stay, it ought to be permissible for Cablevision to offer its customers exactly the same service they could have gotten by buying a gizmo. Call it “noninfringing personal fair use” and we can all go home.

Unfortunately, he notes that such a result wasn’t possible in the Cablevision case, because Cablevision itself chose not to litigate the fair use issue in its case. End result? More insanity.

Of course, even Grimmelmann’s solution potentially leads to some other issues, as well. For example, we’ve long argued that an embedded video on a website isn’t infringing because it’s no different than a link — and that if there’s infringement, it’s from the uploader or hosting provider, rather than the intermediary who posted the embed code. But under Grimmelmann’s “end user” analysis, then anyone who embeds could be liable as well, as to the end user, it wouldn’t appear any different than a site that hosted the content. That raises some difficult questions as well.

But there’s a reason for that: because these laws were designed for a very different era and very different technology. The concept of an open internet, and even something like an “embed code” is completely foreign to copyright law, meaning that it’s legality is very much in the eye of the beholder. And really, that just serves to highlight the real problem here: copyright law isn’t built for modern technology, and that’s creating all sorts of problems for innovative services.

Either way, Grimmelmann’s whole article is absolutely worth reading, so go check it out, even if it may make you bang your head repeatedly at the pure insanity of the situation we’re in today.

Filed Under: copyright, insanity, streaming
Companies: aereo, cablevision, ivi, zediva