NEW TECH ALLIANCE NOT CONCERNED WITH FCC INQUIRY

ADP’s primary concern is Capitol Hill, not regulatory agencies, ADP Pres. Fred McClure told reporters Thurs.: “We're not going to be going to the FCC. We will be engaged in efforts to watch the legislative movement on Capitol Hill.” He said “we're concerned about any legislative or regulatory activity the result of which would be the government designing and mandating anticopying technology,” but on FCC’s broadcast flag inquiry, “it does not concern me.” McClure said reason was that “it has resulted from collaboration in the private sector… it is not the Senate Commerce Committee coming up with the mousetrap that’s going to give our laptops a lobotomy.” That said, he wouldn’t say whether ADP ultimately would support FCC mandate that stemmed from industry negotiations: “We'll cross that bridge when we come to it.”

Hollings will be watching progress of private sector negotiations in determining whether he needs to reintroduce his bill, his spokesman said. “As long as there’s progress in negotiations” it’s unlikely he would do so, spokesman said, noting that Hollings always has said his preference was for industry agreement. It’s critical that any negotiations “balance protection of fair-use rights and protection of copyright,” spokesman said.

Despite no immediate threat of tech mandate legislation, McClure said new alliance was needed. “One must be ever vigilant in terms of watching vehicles that could have legislation like that tacked onto it or free-standing legislation… There have been indications on the other side that there will continue to be efforts… It always has a potential for springing into action and sneaking in somewhere.” He read quotes from MPAA that said organization still maintained mandates should be one consideration, adding: “That doesn’t sound to me like the issue is going away.” Hollings’ spokesman wondered why new alliance was necessary. “I guess I don’t understand why they need an alliance” to combat tech mandates, he said. Referring to members of alliance, he said “they've been pretty active already.”

No Danger of Stoking Fire, McClure Insists

McClure insisted alliance wouldn’t add to vitriol in content debate and wouldn’t stymie private sector negotiations. ADP won’t be part of negotiations or in hashing over legislation, he said: “ADP is not hashing, ADP is opposing government mandates.” He did have strong words for Hollywood, saying it had “a long history of fear and opposition to new technology” and it was “mind-boggling to hear demands for government mandates coming from an industry that for each of the past three years has enjoyed record revenues.” Asked about ADP strategy, he said “I'm not going to reveal our campaign plans at this point in time. When you do that, the enemy gets a chance, not the enemy, the opposition, the opposition gets a chance to get in front of you.”

“It’s a bit strange that the IT community launches a million-dollar campaign against the movie industry, and their spokesman at a press conference charges us as the ‘enemy,'” MPAA Pres. Jack Valenti said Thurs. He said content industry had been negotiating in good faith with IT and CE companies “for a long time,” trying to reach “a mutually agreeable conclusion.” “We are not the enemy,” he said, “We are not at war with the IT community. We are hoping that these meetings will produce amiable results. Which is why I am shaking my head in wonderment at this million-dollar campaign to deride us.”

Asked whether alliance would make negotiations more difficult, McClure flipped issue by suggesting Hollywood’s call for tech mandates “complicates the ability of private sector collaboration… If we don’t have that out there putting that sort of pressure on the situation, we want those discussions to continue… If that is not out there, then I think an environment exists for the kind of collaboration we want to encourage.” Hollings’ spokesman said senator wouldn’t want ADP members to “sit on their hands” awaiting removal of specter of tech mandates before continuing inter- industry dialog.

CEA Holding Out for Boucher Bill

One prominent group in content debate conspicuously absent from ADP membership was CEA. “We are having discussions” with CEA, McClure said, “and will continue to have discussions with them in that regard and hope they can find a way to join us.” CEA Vp-Communications Jeff Joseph confirmed discussions -- “we share some of the same goals” -- but said 2 groups diverge sharply on legislation introduced by House Internet Caucus Co-Chmn. Boucher (D-Va.). That bill would amend Digital Millennium Copyright Act to, among other things, permit circumvention of copy-protection mechanisms when performing fair use. “The Boucher bill is A #1,” Joseph said.

Several CEA members are members of ADP, including Dell, Intel, Microsoft and Motorola. Joseph said CEA would “see if there are opportunities to work together” with ADP, but he didn’t believe Hollings-type legislation would be going anywhere. He said CEA’s main priority, as outlined at CES, was to work with Home Recording Rights Coalition to wage aggressive grass-roots campaign in support of fair use.

ADP has very narrow focus of opposing govt. mandates on technology and opposing online piracy, McClure said repeatedly during press briefing. Asked about 7-point agreement on protecting content announced last week including RIAA, Business Software Alliance (BSA) and Computer Systems Policy Project (CSPP) (CD Jan 15 p4), McClure pointedly addressed only 2 points that mirrored ADP -- no tech mandates and opposing online piracy. BSA and CSPP are ADP members; RIAA isn’t, and outgoing Chmn. Hilary Rosen made it clear last week RIAA would not be joining group. CEA won’t join that agreement because BSA and RIAA oppose Boucher bill, Joseph said.

Despite repeated insistence that ADP intended to protect consumers, McClure refused to discuss issue of fair use. “Our organization is not about the scope of copyright law,” he said: “That’s not why we're here.” Information Technology Assn. of America (ITAA) is one member, and Senior Vp-Governmental Affairs Joseph Tasker told us he hoped fair use would become more of focus of ADP over time.

New Group’s Structure, Financing Unclear

It was unclear exactly how ADP was structured. McClure, lobbyist with Winstead Sechrest & Minick, is pres., while exec. dir. is Bruce Heiman, who also is exec. dir. of Americans for Consumer Privacy and chmn. of Information Technology Policy Group at Preston Gates. Media are being handled by outside firm, Dittus Communications, which reportedly received $1 million contract for 6 months for this account. Detailed questions on ADP’s organization, legal status and financing hadn’t been answered by our deadline.

Twenty-seven associations, alliances and companies are founding members of ADP, and McClure said he was actively recruiting more. Among groups are American Electronics Assn. (AEA), BSA, ITAA and Semiconductor Industry Assn. Companies include Apple, Cisco Systems, Dell Computer, Hewlett-Packard, IBM, Intel, Microsoft and Motorola. Other groups include Competitive Enterprise Institute (CEI), Consumer Alert, DigitalConsumer.org, Digital Media Assn. and 60 Plus Assn., seniors’ group.

Several of groups issued statements in support of ADP’s launch. ITAA Pres. Harris Miller said “Hollywood leaders like Jack Valenti would have organized the monks to burn down Gutenberg’s printing press.” BSA Pres. Robert Holleyman was more conciliatory -- “we sympathize with the entertainment industry’s concerns about Internet piracy” -- but still said Hollywood was “simply missing the point” by calling for mandates. CSPP Exec. Dir. Ken Kay said “Hollywood needs to work with us on consumer education, increased enforcement and market-based solutions to protecting digital content.” National Assn. of Manufacturers said it wrote Congress last March in opposition to tech mandates and had “worked in this field since 1904.” CEI Technology Counsel Braden Cox said mandates “set a dangerous precedent for government involvement in the area of digital content as a ‘copyright czar.'” Consumer Alert echoed McClure and others in faulting Hollywood for opposing VCR 20 years ago. The 60 Plus Assn. said that as seniors bought PCs “that daily close their information gap” they need to be devices free of govt. mandates. More information on ADP is at www.alliancefordigitalprogress.org.