Tag Archives: DMCA

Copyright Infringement – a New Worry for ISPs

In decisions that should trouble every ISP, multiple Courts have ruled that ISPs are liable if they don’t disconnect customers accused of copyright infringement.

The U.S. Court of Appeals for the 5th Circuit ruled against Grande Communications, a subsidiary of Astound Broadband. The courts sided with three record companies, Universal, Warner, and Sony that Grande had failed to disconnect customers from broadband who engaged in copyright infringement by downloading illegal copies of music. Grande might have been singled out because it had a firm policy since 2010 that it wouldn’t disconnect customers over the infringement issue. The appeals court upheld a lower court ruling that Grande is liable for copyright infringement. The appeals court said it would consider lowering the original award of $46.8 million.

This is the second major lawsuit on the issue. In 2018 the major record labels sued Cox Communications over its copyright policies. The labels accused Cox of refusing to disconnect customers who repeatedly broke copyright rules by downloading music without paying for it. In 2019, a court in Virginia found Cox liable for both contributory and vicarious copyright infringement and awarded the music labels an astounding $1 billion in damages. Cox appealed, and the Fourth Circuit U.S. Court of Appeals upheld the charge of contributory infringement but reversed the charges for vicarious infringement and vacated the $1 billion in damages.

Cox asked the Supreme Court in August to decide whether the 4th Circuit erred in deciding that an ISP can be held liable for copyright infringement without proof that the company fostered or promoted copyright infringement. The record labels are asking the Supreme Court to reinstate the original $1 billion award.

This has to concern all ISP, because if these two cases are resolved in favor of the record industry, then all ISPs are vulnerable. Altice USA, Frontier Communications, Lumen, and Verizon filed a brief with the Supreme Court saying that the 4th Circuit ruling imperils the future of the Internet by making ISPs liable for huge damages if they don’t carry out mass Internet evictions.

Folks might have a visceral reaction thinking that copyright offenders should be punished. There is some needed context to fully understand the issue. Complaints of copyright infringement are rarely made directly by record companies or others who hold copyrights, There is an entire industry of companies that makes a living by issuing takedown requests for infringements of copyrighted materials. These companies get paid by issuing huge numbers of takedown requests. Social media companies are inundated with these takedown requests every day to remove posts that link to copyrighted music, movies, and other materials.

The takedown process is completely one-sided and there is no appeal for a broadband customer who is unjustly accused of bad behavior. The music companies expect ISPs to cut off subscribers after only a few claimed violations of copyright.

This is also troubling to broadband customers. Any home with teenagers will have to worry if teens will download copies of games, movies, or music. People could hit a link on social media that downloads copyrighted material without even realizing they did something wrong. The bad behavior doesn’t even have to be done by a family member. Losing an essential broadband connection because teens, roommates, or visitors violated copyright laws seems like an extreme penalty. If ISPs start cutting customers dead for violating copyrights, I have to imagine that people are going to be a lot more cautious against giving visitors or even family members the WiFi password.

Copyright holders want ISPs to act as judge, jury, and executioner and unilaterally punish customers without a trial or hearing by taking away their Internet access. Like many other problems in the industry, the only real fix for this is to have Congress update or replace the Digital Millennium Copyright Act (DMCA), which was adopted in the 1990s when we were all still using dial-up access.

The recording industry has a legitimate gripe, but their complaint is against the folks who steal copyrighted materials. They should be required to pursue a law enforcement solution, like is done for folks who violate other laws. The solution is not to turn the intermediate ISP into a policemen on the issue. This goes down an ugly and slippery slope. What’s next, forcing ISPs to turn off broadband for customers who break myriad other laws?

Copyrights and ISPS

There is a long-running legal case that could have dire consequences on broadband households. The case started in 2018 when a group of major record labels sued Cox Communications over its policies related to copyrights. The labels accused Cox of refusing to disconnect customers who repeatedly broke copyright rules by downloading music without paying for it.

In 2019, a court in Virginia found Cox liable for both contributory and vicarious copyright infringement and awarded the music labels an astounding $1 billion in damages. Cox appealed, and the Fourth Circuit U.S. Court of Appeals reversed the charges for vicarious infringement and vacated the $1 billion of damages. There will be a new trial to reassess the size of the damage award.

The troubling part of the legal ruling is that, even after appeal, Cox still stands in violation of contributory damages over actions taken by its customers. That’s a ruling that should concern every ISP – and every Internet user.

The record labels are insisting Cox should have permanently disconnected any customer who engaged in repeated copyright infringement. This ruling turns ISPs into Internet policemen who must monitor and punish customers who engage in copyright infringement. That doesn’t just mean people who download copies of music but also movies, games, and books. It means that in order to avoid having to pay big damages, ISPs might cut off customers for watching a pirated sporting event.

This is an incredibly uncomfortable role for ISPs. ISPs are not going to monitor everything their customers do, but will instead react to complaints made by copyright holders. Complaints are rarely made directly by those holding copyrights, and there is an entire industry of companies that make a living by issuing take-down requests for infringements of copyrighted materials. Social media companies are inundated with these take-down requests every day to remove posts that link to copyrighted music, movies, and other materials. The music companies expect ISPs to cut off subscribers after only a few violations of copyright. ISPs are in the business of selling broadband connections, and the last thing they want to do is to disconnect paying customers.

This could be devastating for broadband customers. Most homes in the U.S. don’t feel that they have broadband choice and only have access to one fast ISP. If they lose that connection, they could find themselves cut off from functional broadband.

It’s easy to believe that customers who get cut off for such violations deserve it. But the process is completely one-sided and there is no appeal for a broadband customer that they were unjustly accused of bad behavior. They can be cut off without appeal or recourse. Any home with teenagers will have to worry that their teens don’t download copies of games, movies, or music. People could hit a link on social media that downloads copyrighted material without even realizing they did something wrong. Such downloads could be done on a cellphone that is using a home’s WiFi – and the bad behavior doesn’t even have to be done by a family member.

This is a case where the punishment does not fit the crime. Rather than directly pursuing people who download pirated copyrighted material through a legal process, copyright holders want ISPs to act as judge, jury, and executioner and unilaterally punish customers by taking away their Internet access.

There are numerous surveys since the pandemic that show that a large majority of people now consider a broadband connection to be essential. All of the surveys my consulting business has done in the last year show that half or more of homes now have somebody working from home using broadband at least part-time every week, and we routinely find 10% to 15% of homes with somebody working at home full time. We now use broadband for a wide variety of essential activities such as shopping, banking, hunting for a job, and connecting with a doctor.

While the courts vacated the billion-dollar penalty against Cox, ISPs are all going to notice if the Appeal Courts still imposes a sizable penalty during the rehearing of the damages. Losing an essential broadband connection because teens, roommates, or visitors violated copyright laws seems like an extreme penalty. If ISPs start cutting customers dead for violating copyrights, I have to imagine that people are going to be a lot more cautious against giving visitors or even family members the WiFi password.

Like many other problems in the industry, the only real fix for this is to have Congress update or replace the Digital Millennium Copyright Act (DMCA), which was adopted in the 1990s when we were all still using dial-up access.

Twenty Five Years of DMCA

One of the most disliked but necessary laws in the broadband world has been DMCA (Digital Millenium Copyright Act). This law was passed in 1999 to put the U.S. in compliance with the worldwide World Intellectual Property Treaty.

The DMCA law is one of the major reasons that companies felt safe in creating social media platforms. Section 512 of the law is the one that web policy folks know about. This part of the law creates a safe way for a website to host user-generated content. The law says that a website is safe from copyright infringement suits as long as it registers with the U.S. Patent Office as a DMCA agent and agrees to pull down any content that a copyright owner finds to be in violation of its copyright.

This one provision freed websites to start hosting user-generated content. The early fear was that copyright infringement complaints and lawsuits could paralyze and bankrupt anybody that openly allowed the public to post anything they wanted. The DMCA rules mean that a website owner doesn’t have to monitor content for copyright infringements (something nobody knows how to do) and instead puts the onus on the copyright holder to ask to have the offending content removed.

There are a lot of problems caused by DMCA. One of the biggest complaints about DMCA is that websites typically remove anything upon request, including a lot of content that is not infringing on copyright laws. This has allowed unscrupulous people to use the DMCA system as a way to censor content they don’t like.

But a bigger complaint by First Amendment advocates is that the pressure created by DMCA has led many website owners to censor their own sites to cut down on the number of DMCA takedown requests. It’s expensive for a national website to have enough people on hand to react to huge volumes of takedown requests. Website owners often try to reduce DMCA notices by screening and blocking content that they think will be in violation. That’s a slippery slope from a First Amendment perspective because any censoring software is going to make mistakes and block legitimate content.

Another big problem is that the DMCA process is not instantaneous. People can post content that they know is in violation with the knowledge that the content will be available long enough to be useful. For example, there are people who routinely post a pirated version of live sporting events since they know that any DMCA takedown won’t happen until after the event is over.

Another outcome of DMCA rules is that an entire industry of companies has been created to monitor content on websites and issue DMCA takedown requests. Some of these companies also routinely sue website owners that they say are out of compliance – and they are accused of doing so to negotiate monetary settlements rather than to deal with content issues. These efforts are a major cost and annoyance for large web companies, but can be devastating for any startups or small web companies.

There have been attempts in recent years to pass laws that are harsher and more difficult to comply with than DMCA. For example, the Kids Online Safety Act (KOSA) that is currently being considered would require websites to take steps to always block harmful content from getting to children. This would not only be things like pornography, which many websites already block but would include other content that is identified as harmful by parents. It’s one thing to ask a website owner to comply with copyright laws, but it’s something entirely different to ask website owners to somehow identify and block an ever-changing list of content that is deemed to be offensive.

The Newest Battle of Copyright Infringement

For years the big ISPs have paid lip service to complaints about customers who violate copyrights by sharing content on the web for music and video. Every big ISP has had a process in place that was intended to police violation of the Digital Millennium Copyright Act (DMCA).

The owners of copyrighted materials have long complained that the ISP response to violators has been weak and ineffective. And they are right in that most ISPs notify customers that they are accused of violating copyrights, but there has been little or no consequences for violators.

However, that might now be changing due to a lawsuit that’s been in the courts for a few years. Music label BMG sued Cox Communications for not providing adequate protection of it’s copyrighted music. Recently the 4th Circuit Court, on appeal, reversed the original verdict against Cox. However, in doing so the court threw out Cox’s primary defense, which was that they were protected by the ‘safe harbor’ laws that are part of DMCA.

The safe harbor rules protect ISPs like Cox against damages from customer theft of copyrighted materials. Removing the safe harbor means that the owners of copyrighted materials can seek and win damages against ISPs if they don’t take adequate steps to protect copyrights. In the specific case against Cox, the BMG issue was that Cox didn’t do anything to deter repeat offenders.

There are apparently a lot of repeat offenders – customers who share a lot of copyrighted material – so this ruling instantly got the attention of other big ISPs. Comcast responded last week by notifying customers of a new policy for repeat offenders of copyright theft. The new policy has several progressive stages of severity:

  • Customers notified of DMCA violations might be forced to log in fresh to their broadband account, and in doing so will probably have to agree to abide by the company’s DMCA policy before getting access. Customers might also have to talk to Comcast customer service before they can log into their broadband account.
  • Customer that continue to violate DMCA policies after this first stage face termination of their broadband and all other Comcast services.

This is going to have a chilling effect on those that share copyrighted materials. A majority of people live in markets where the cable company offers the best broadband, and losing the home broadband connection is drastic. I have to assume that telcos will come up with similar policies, meaning that DSL also won’t be a refuge for anybody who continues to violate copyrights.

There has always been people who share content. The old public bulletin boards were full of copyrighted songs and pictures that could be shared. Over time this morphed into Napster and other file-sharing services. Today there are still a number of sharing sites on Tor and other places on the web. And people have figured out how to use Kodi and other technologies to capture and share copyrighted video files.

Although they don’t want to play the role of policeman, I suspect the big ISPs will be forced to at least somewhat enforce policies like the one Comcast just initiated. There has always been a big tug of war between ISPs and content owners. This new response from Comcast shows that content owners now have the upper hand. It certainly means that those who continue to share copyrighted materials will face eventually losing their broadband. In today’s world that’s a severe penalty.

Smaller ISPs need to pay attention to this and watch what the big companies are doing. I wouldn’t be surprised to see BMG or some other content owner sue a smaller ISPs to make a point that this applies to everybody – and nobody wants to be that ISP. If the big ISPs really enforce this, then small ISPs need to follow suit and figure out an effective way to police and deter repeat copyright violators.

 

Ownership of Software Rights

There is an interesting fight currently at the US Patent Office that involves all of us in the telecom industry. The argument is over the right of ownership of the software that comes along these days with almost any type of electronics. The particular fight is between John Deere and tractor owners, but the fight is a precedent for similar software anywhere.

John Deere is arguing that, while a farmer may buy one of their expensive tractors, John Deere still owns the software that operates the tractor. When a farmer buys a tractor they must agree to the terms of the software license, just like we all agree with similar licenses and terms of service all of the time. The John Deere software license isn’t unusual, but what irks farmers is that it requires them to use John Deere authorized maintenance and parts for the term of the software license (which is seemingly forever).

The fight came to a head when some farmers experienced problems with tractors during harvest season and were unable to get authorized repair in a timely manner. Being resourceful they found alternatives and there is now a small black market for software that can replace or patch the John Deere software. But John Deere is attacking farmers that use alternate software saying they are violating the DMCA (Digital Millennium Copyright Act) which prohibits the bypassing of copyrighted locks on content. They argue that farmers have no right to open or modify the software on the tractors which remains the property of John Deere. The Patent Office is siding with John Deere.

This is not a unique fight for farmers and the owners of many electronics companies are taking the same approach. For example all of the major car manufacturers except Tesla have taken the same position. Apple has long taken this position with its iPhone.

So how does this impact the telecom industry? First, it seems like most sophisticated electronics we buy these days come with a separate software license agreement that must be executed as part of a purchase. So manufacturers of most of the gear you buy still think they own the proprietary software that runs your equipment. And many of them charge you yearly after buying electronics to ‘maintain’ that software. In our industry this is a huge high margin business for the manufacturers because telcos and ISPs get almost nothing in return for these annual software license fees.

I don’t think I have a client who isn’t still operating some older electronics. This may be older Cisco routers that keep chugging along, an old voice switch, or even something major like the electronics operating an entire FTTH network. It’s normal in the telecom industry for manufacturers to stop supporting most electronics within 7 to 10 years of its initial release. But unlike twenty years ago when a lot of electronics didn’t last more then the same 7 – 10 years, the use of integrated chips means that electronics are working a lot longer.

And therein lies the dilemma. Once a vendor stops supporting a technology they literally wash their hands of it – they no longer issue software updates, they stop stocking spare parts. They do everything in their power to get you to upgrade to something newer, even though the older gear might still be working reliably.

But if a telco or ISP makes any tweaks to this older equipment to keep it working – something many ISPs are notorious for – then theoretically anybody doing that has broken the law under the DMCA and could be subject to a fine up to $500,000 and a year in jail, for a first offense.

Of course, we all face this same dilemma at home. Almost everything electronic these days comes with proprietary software and the manufacturers of your PCs, tablets, smartphones, personal assistants, security systems, IoT gear and almost all new appliances probably think that they own the software in your device. And that raises the huge question of what it means these days to buy something, if you don’t really fully own it.

I know many farmers and I think John Deere is making a huge mistake. If another tractor company like Kubota or Massey Ferguson declares that they don’t maintain rights to the software then John Deere could see its market dry up quickly. There is also now a booming market in refurbished farm equipment that pre-dates proprietary software. But this might be a losing battle when almost everything we buy includes software. It’s going to be interesting to see how both the courts and the court of public opinion handle this.

Another Hassle for ISPs – Policing Pirated Music

Louis_Armstrong_restored_(color_version)You probably remember the attempts of the Recording Industry Association of America (RIAA) last decade when they tried to stop file sharing of music by randomly suing those who shared music files on line. They would go after college students and others and sue them for $750 to $12,000 per song shared and made the cases public to scare other people from sharing music. They stopped this practice in 2008 and instead went after ISPS, asking them to deny service to people who violated their copyrights more than three times.

But now the issue is back in play and ISPs are going to find themselves routinely asked to chase file sharers. Some of the music industry has made a deal with a new company called Rightscorp which is now chasing file sharers instead of the RIAA. Rightscorp asks file sharers to settle for $20 per song violation instead of being sued, and any collected proceeds are shared 50/50 with the recording labels like BMG and Warner Brothers.

The company started in 2012. In 2013 they collected around $750,000 in settlements, but they have a technology that could let them pursue these violations by the millions. And that is where the new hassle for ISPs will come in.

Rightscorp monitors file uploads and downloads at file sharing sites like BitTorrent. They are capturing the IP address of people sharing songs illegally. While they don’t know the identity of the violator they know the ISP involved, and they are asking ISPs to forward their demands for settlements on to violators.

Rightscorp is relying on the Digital Millennium Copyright Act (DMCA) which they believe requires ISPs to forward on their notices. They claim to be working now with 70 ISPs, but there are many ISPs who either do not think they are required to pass on settlement offers, or who pass on only an abbreviated version of the Rightscorp demand for payment. But one would expect with the technology they are using that they are going to be asking every ISP to help them.

There are existing alternatives to what Rightscorp is doing. There is already a process under development among ISPs that is creating a ‘six strike’ system that will deny Internet access to people who violate copy rights multiple times. But Rightscorp and others believe that this system will not have teeth since the ISPS are not heavily invested in kicking out paying customers.

Rightscorp has developed a technology that lets them track file sharing across multiple IP addresses. This is needed since ISPs issue a new IP address to a user any time they initiate a new connection to their server. Rightcorp believes that their audit trail showing multiple violations gives them the leverage to get ISPs to help them. Certainly that is the kind of evidence that could be used in court against an ISP who refuses to help them. They have not sued an ISP yet, but the threat is there. And obviously some ISPs are helping them since they have collected so far from over 70,000 violators.

As an ISP you need to decide what to do when you get one of these demands from Rightscorp. Do you do nothing, do you pass on the full demand to your customers or do you somehow edit the demand before forwarding it? Do you share your customer’s identity with Rightscorp? These are not easy questions to answer. But one thing is for sure and this is just one more of the little hassles that keep getting loaded onto being an ISP today.