WIPO seminar on ISP liability

On 18 April WIPO hosted a seminar in Geneva on copyright and ISP
liability. Dominated by representatives of the entertainment industry and
international government officials, the highly politicised seminar ended
with the conclusion that more legislation was indeed necessary. The main
issue however remained unsolved; whether this legislation should provide
stronger protection for the fundamental rights and freedoms of all
internet users, or whether this legislation should further facilitate the
entertainment industry in hunting down individual internet users.

The opening keynote speeches by Lilian Edwards and Charlotte Waelde from
the AHRB Research Centre in Intellectual Property and Technology of the
University of Edinburgh provided the audience with an excellent overview
of all the issues related to provider liability for content provided or
shared by their customers. Edwards started with the problematic definition
of ‘service provider’, which now also includes online auctions, search
engines, RSS feeds, blogs, chat-rooms and price comparison sites. In the
period leading up to the year 2000 governments were hesitant to regulate
liability, fearing it would disturb the nascent market. But after 2000 the
market was mature enough and governments and the entertainment industry
were dissatisfied about the lack of self-regulatory solutions. The EU
E-commerce directive from 2000 then forced a compromise by distinguishing
in possible liability for hosting third party content and no liability for
mere conduit and temporary caching. Charlotte Waelde analysed the
jurisprudence of the different court cases against producers of P2P
software, both in the US and in the Netherlands. She concluded that it is
crucial for the liability question in P2P cases to determine whether the
ISP is somehow authorising the infringement, or whether an ISP is entitled
to presume that facilities will be used in accordance with the law.

Jule Sigall from the US Copyright Office showed himself very content with
the Digital Millennium Copyright Act of 1998 (DMCA) and stated that the
actual rise of P2P usage was directly caused by the success of notice and
takedown of websites. The possibility for a customer to file a counter
notice was very effective, according to him, to prevent abuse. An entirely
different view of the DMCA was given by Cory Doctorow, the European
Affairs director of EFF. He gave an overview of the wrongful complaints
collected by the Chilling Effects project and said many small providers
receive up to a 100 complaints a month, many of them not even compliant
with the minimum DMCA standards. Doctorow asked repeatedly ‘What problem
does notice and takedown solve?’ since hotly contested information will
always reappear in hundreds of other places, the procedure costs a lot and
leads to the inefficient prosecution of John Does, while seriously
threatening free speech and undermining due process rights.

In the afternoon the debate finally began to heat up, when attorney
Christiaan Alberdingk Thijm, Verizon Vice President Sarah Deutsch en
Universal Music Vice President Barney Wragg debated the pros and cons of
peer to peer usage. Wragg said his company embraced P2P usage but only
within systems that allow total control for artists, control the exact
usage of the materials and provide compensation at agreed rates. Universal
Music is signing up 10 new online download services a week, and even
though the revenues still account for less than 1% of the total business,
online sales are rising exponentially. Alberdingk Thijm, who successfully
defended KaZaA at the Dutch Supreme Court, replied by pointing out how
difficult the WIPO copyright treaty of 1996 had made life for people that
wanted to do legal business with online music. While the rise of Internet
made it possible to skip the intermediary from the exploitation, the
copyright treaty had made it much more difficult to get international
clearance from copyright owners. KaZaa for example tried very hard to get
licenses, but was refused everywhere. This deadlock put consumers in an
impossible position. The only solution Alberdingk Thijm saw is compulsory
licensing or general levying.

Sarah Deutsch started from a moderate position, saying most service
providers have evolved into content producers, with a joint interest in
combating piracy. But after those reassuring words, she opened a frontal
attack on the Motion Picture Association, specifically the wish-list
circulated in advance of the conference, demanding a.o. that providers
should immediately hand-over identifying details about their customers to
right holders and terminate contracts with ‘repeat’ (alleged) infringers.
This proposed ‘ISP code of conduct’ conflicts with all existing law in the
US and Europe, and doesn’t contain a single reciprocal obligation for
right holders. She said Verizon received hundreds of thousands of invalid
notices per year, based on automated search bots operated by commercial
bounty hunters, leading to a barrage of complaints sent from invalid
e-mail addresses. An ISP is not a policing service and privacy-rights of
users should be respected. She also disqualified the demands from the
industry to use ‘available filtering or blocking technology’ to stop users
from file-sharing as ‘a slippery slope that can easily lead to situation
we know from China, where all traffic is filtered on the backbone.’

A spokeswoman from the IFPI (International Federation of the Phonographic
Industry) stood up from the audience and explicitly denied any involvement
with the MPA wish-list (See also EDRI-gram 3.7). Later on, panellist Ted
Shapiro from the MPA said the wish-list was based on the success of
general agreements with service providers in France, Spain and Italy and
that the MPA had exchanged information with the IFPI. The denial of any
IFPI interest is even stranger in the light of the speech by IFPI CEO John
Kennedy to the European network operators on 3 March 2005, published on
the IFPI website, with remarkably similar demands on the ISP industry.

In the closing debate the audience didn’t get much chance to speak up; the
7 panellists used almost an hour of the dedicated 1,25 hour interaction
time. In the few possible interventions the complete lack of consensus
became extremely clear, with ISPs being bluntly accused of promoting
thievery, while the entertainment industry was accused of only using a
stick to change the behaviour of customers, in stead of also holding out
carrots. When Ted Shapiro said it was impossible to compete with free,
Lilian Edwards immediately pointed to the success of expensive mineral
water, in spite of the abundant availability of free tapwater.

WIPO program with presentations of most speakers (18.04.2005)
http://www.wipo.int/meetings/2005/wipo_iis/en/program.html

Speech John Kennedy, CEO IFPI at ETNO conference (03.03.2005)
http://www.ifpi.org/site-content/press/inthemedia14.html