Musings of the Great Eric

Circumventing Competition: The Perverse Consequences of the Digital Millennium Copyright Act

Executive Summary

The courts have a proven track record of fashioning balanced remedies for the copyright challenges created by new technologies. But when Congress passed the Digital Millennium Copyright Act in 1998, it cut the courts out of this role and instead banned any devices that “circumvent” digital rights management (DRM) technologies, which control access to copyrighted content.

The result has been a legal regime that reduces options and competition in how consumers enjoy media and entertainment. Today, the copyright industry is exerting increasing control over playback devices, cable media offerings, and even Internet streaming. Some firms have used the DMCA to thwart competition by preventing research and reverse engineering. Others have brought the weight of criminal sanctions to bear against critics, competitors, and researchers.

The DMCA is anti-competitive. It gives copyright holders—and the technology companies that distribute their content—the legal power to create closed technology platforms and exclude competitors from interoperating with them. Worst of all, DRM technologies are clumsy and ineffective; they inconvenience legitimate users but do little to stop pirates.

Fortunately, repeal of the DMCA would not lead to intellectual property anarchy. Prior to the DMCA’s enactment, the courts had already been developing a body of law that strikes a sensible balance between innovation and the protection of intellectual property. That body of law protected competition, consumer choice, and the important principle of fair use without sacrificing the rights of copyright holders. And because it focused on the actions of people rather than on the design of technologies, it gave the courts the flexibility they needed to adapt to rapid technological change.

As others have remarked on this, it’s amazing how opposition to  the DMCA comes from across the political spectrum. CATO is about as right wing libertarian as you can get - they’re not saying anything much different from what technologists have been saying for years. It seems that everyone is able to see just how idiotic and counterproductive this law is; everyone, in fact, who’s not a media company executive.

This comes on the heals of another anecdote regarding the DMCA. From Freedom to Tinker:

Some background: In light of the Sony-BMG CD incident, Alex and I asked the Copyright Office for an exemption allowing users to remove from their computers certain DRM software that causes security and privacy harm. The CCIA and Open Source and Industry Association made an even simpler request for an exemption for DRM systems that “employ access control measures which threaten critical infrastructure and potentially endanger lives.” Who could oppose that?

The BSA, RIAA, MPAA, and friends — that’s who.

It’s interesting that these giant industry groups and conglomerates are defending so feircely something that’s so clearly anti-consumer and anti-competition. Interesting, but not surprising.