Regulators’ Role Seen Rising As E-Content Tied To Devices

When Amazon.com remotely deleted George Orwell’s “1984″ and “Animal Farm” from its Kindle e-books, it stirred up a hornet’s nest of complaints about privacy, the potential erosion of copyright users’ rights and censorship. Is the shift to “tethered devices” a real cause for concern or much ado about nothing?

Copies of the Orwell classics vanished from Kindle readers in July. Amazon said the books were added to the Kindle store by a company that did not have rights to them, the New York Times and others reported. Amazon CEO Jeff Bezos apologised in a 23 July company blog, saying “the way we previously handled illegally sold copies of 1984 and other novels on Kindle” was “stupid, thoughtless, and painfully out of line with our principles.”

Kindle is one of a growing number of devices – mobile phones, video games consoles, digital video recorders such as TiVo, iPods, iPhone and BlackBerries among them – that remain connected to their vendors after purchase. These appliances are a response to the proliferation of internet and computer security problems, Jonathan Zittrain, Harvard Law School professor and Berkman Center for Internet & Society co-founder, argued in his 2008 book “The Future of the Internet and How to Stop It.” The ongoing communication between vendors and their devices “assures users that functionality and security improvements can be made as new problems are found,” he wrote.

That is not a problem unless the growing number of tethered devices shifts “our information ecosystem away” from the “generativity” now made possible by the internet and personal computers, Zittrain wrote. Connected appliances will tempt regulatory intervention, he said.

With products tied to the network, regulators “finally have a toolkit for exercising meaningful control over the famously anarchic internet,” he wrote. But the ability to thoroughly “scrub everyone’s digital repositories of unlawful content” could permanently censor some materials from the public, he said.

“The key move to watch is a sea change in control over the endpoint: lock down the device, and network censorship and control can be extraordinarily reinforced,” Zittrain said. Generative technologies should have wide latitude to find many uses, some of which may encroach on other interests, he said. Those encroachments may be undesirable, but they also offer opportunities to rethink the rights underlying threatened traditional markets and business models, he said.

“Society should be Worried”

Zittrain’s concerns are quite valid, said Electronic Frontier Foundation Senior Staff Attorney Fred von Lohmann.

There is a growing disconnect between consumer expectations, formed in a world of physical goods, and today’s digital offerings, he said. Much of the blame lies with digital content vendors, who “hide the details in obscure legalese,” as in the terms of use for Amazon MP3, or fail to disclose them altogether, he said. Kindle’s terms of use promise “permanent downloads” consumers can read as often as they like, but don’t mention their remote deletion capabilities, he said. Other services, such as iTunes, leaves ownership rights “opaque,” he added.

Copyright law has traditionally given users certain privileges in connection with “ownership,” such as the right to make personal copies, or to copy software as needed to run it, von Lohmann said. But other privileges that come with ownership are the result of physics, not law, such as right to use the content without being under surveillance, he said. Consumers should worry about the erosion of both kinds of privileges, he added.

“As a society, we should be very worried when people are using and depending on devices they don’t control,” said Free Software Foundation (FSF) Campaigns Manager Holmes Wilson, who is heading up a petition drive against Amazon’s Kindle and publishers using digital rights management (DRM).

TiVo software is mostly free because it is a version of GNU/Linux, but vendors then use DRM to prevent users from modifying it, Wilson said. Moreover, TiVo can “push out updates” such as removing the 30-second skip, without users’ explicit permission or control.

Apple iPods use DRM in the more usual way to make sharing difficult and lock out competition, he said. The Kindle is similar but adds the “twist of a ‘remote control’ option” that can be used to delete books.

But the iPhone is “the most insidious of all,” Wilson said. It offers a general-purpose computer and gives consumers the illusion of being able to install and remove programmes as they can with a typical computer. But Apple uses DRM to vet every application before a user can load it on the iPhone, and has famously rejected applications that compete with its products or those of its partner AT&T, he said.

Is Unrestricted Use a Basic Right?

The device control debate lacks a civil law perspective, said Cedric Manara, who focuses on internet and intellectual property issues and is currently visiting professor at the Facolti di Giurisprudenza, Universiti degli Studi di Salerno, Italy. There is a difference between information, copyrighted or not, carried through networks and stored on consumers’ devices, and the files which are the vehicle for that data, he said. The company that is the source of the information, such as Apple or Amazon, licences it and the licence gives it the right to erase what is contrary to prior rights. But the information is stored in a file, which belongs to the consumer.

Amazon deleted the Kindle file of Orwell books to remove the content, Manara said. The issue of sellers’ control over devices arose in a French case in which a mobile phone operator’s customer discovered he could not use the phone with another telecommunications provider because of lack of interoperability. The user sued under an 1804 civil law provision stating that “Ownership is the right to enjoy and dispose of things in the most absolute manner.” A Paris court ruled that the operator could not breach this fundamental right, and that goods must be able to be used in the way their owners expect.

The decision is unique, Manara said. Nevertheless, he said, “we can imagine a world in which consumer groups would sue” to prevent sellers of devices from modifying the products after sale. But that “would be a long, technical and costly battle,” he added.

“Nothing New” for Regulators

As networks grow smarter, more and more services and devices will use network intelligence, said Hogan & Hartson Partner Winston Maxwell, who handles regulatory and communications matters. It is already happening with mobile networks, where SIM cards inside handsets are highly integrated with the network, and with DRM-protected music sold online, he said.

The increased linkage between terminal, content and network is not alarming, Maxwell said. Regulators and competition authorities “will be alert” to ensure that DRM, terminals and network applications do not lock consumers to a given network or terminal, and are already doing this for mobile networks, he said.

France enacted a law to make DRM more interoperable, although the measure has not been applied because music distributors are relying less on DRM, he said. The prospect of using the network or terminal to block certain content is already being dealt with under internet neutrality rules, he said. Exclusive content deals are being vetted under antitrust law.

Bundling, exclusivity and blocking content are issues regulators have already focussed on, Maxwell said: “There’s nothing new.” Smart pipes (networks) and terminals will enable new services like the Kindle to emerge. Regulators will just have to make sure that they are not misused, either to tie in customers or violate their privacy rights, he added.

[Editor’s Note: This issue is among the topics of discussion this week at a workshop at the renowned Bibliotheca Alexandrina (Library of Alexandria), Egypt, called, “Copyright Protection in the Digital Age.”]