Content and CE Groups Spar On Broadcast Flag, Analog Hole Protections

But it was immediately clear from the tone of the debate there was little prospect for harmony among content, CE and consumer groups. MPAA Chmn. Dan Glickman told the subcommittee that groups might disagree how to fix content protection “holes,” but most agree there are holes. He likened the ability of DRM to be stripped away in the analog hole to a car wash that strips away not just the surface dirt, but also the paint underneath.

CEA Vp-Technology Policy Michael Petricone later shot back that MPAA’s analog hole proposal was so complicated, Glickman himself would have trouble explaining how it works, though he has no trouble asking Congress to adopt it. Similarly, he accused the RIAA of trying to “gut” the Audio Home Recording Act and said the CE resents the recording industry calling ordinary consumers “pirates.”

Rep. Boucher (D-Va.) said he harbors no “hostility” toward the broadcast flag. But he said flag rules should be imposed only with “guarantees” of fair-use protection for those who use content legally. He also said he believes there are certain types of programming that “shouldn’t be flagged at all,” such as news and documentaries. But under strict broadcast flag rules, consumers couldn’t upload such content to the Internet.

Boucher said a broadcast flag for digital radio involves different considerations from one for video. “I'm not sure the case has been made we should embark on a broadcast flag for digital radio,” Boucher said. “I'm not sold on the idea yet.” If remedies in the RIAA bill were enacted, it would sap the functionality of digital radio receivers with a “scrolling” feature like that on iPods, he said. Such receivers would be “rendered dead on arrival.”

Issues concerning the video broadcast flag “are very similar to those concerning digital radio,” said RIAA Chmn. Mitch Bainwol. “At the heart, it is about assuring that content licensed for broadcast does not become content permanently distributed instead, whether it is a movie or a song.”

RIAA’s fears aren’t grounded in “paranoia,” but the experience of the past 6 years, when P2P file-sharing sapped recording industry sales, Bainwol said. He said RIAA-commissioned surveys have shown industry revenue growth would have been “robust” if not for P2P. In written testimony, Bainwol said RIAA doesn’t fear “casual recording. We are talking about technologies that allow broadcast programs to be automatically captured and then disaggregated, song-by-song, into a massive library of music, neatly filed in a digital jukebox and organized by artist, song title, genre and any other classification imaginable. Listeners will be able to build entire collections of content without the need to ever purchase any of it; indeed, they won’t even have to listen to it. This is not fair use. It is not time-shifting.”

Bainwol said the potential harm “from loss of sales threatens to rival or even surpass” that of P2P file- sharing, which has already devastated the music and other content industries. “Unlike P2P, digital radio downloads will offer pristine copies of songs without the threat of viruses and spyware. The ubiquity and ease of use of radios outstrips that of computers, and the one-way method of communication allows individuals to boldly engage in piracy with little fear of detection.”

Of the 3 legislative drafts, CE makers consider the RIAA’s audio broadcast flag proposal “the most pernicious,” said CEA’s Petricone. Unlike the video flag, the proposal “is aimed at stopping private and noncommercial recording of lawfully acquired content,” Petricone said. “The only apparent way to accomplish this would be through encryption. With the rollout of HD Radio “well under way,” mandating a new encryption “would render both the transmission infrastructure and the initial radios obsolete, stopping the rollout of this new technology in its tracks.”

Ranking member Berman (D-Cal.) questioned Petricone hard about satellite radio receiver internal hard discs that let users store 750 songs with a monthly subscription fee to Sirius or XM. Berman said he feared that displaced sales. Petricone responded that it was no different from how he uses his TiVo PVR. Petricone said if the recording industry is unhappy with how it’s compensated by the satellite radio, that’s a matter for licensing agreements, not a copyright fix that harms the lawful practices of ordinary consumers. Under RIAA’s proposal, Petricone said, “cool” time-shifting products like XM’s MyFi portable would be rendered illegal.

Although CEA doesn’t oppose an analog hole solution as such, it can come only through multi-industry consensus not apparent in the legislative draft, Petricone said. “This draft is immensely broad and complicated and confusing. This bill would impose a massive government design mandate on every product capable of digitizing analog video signals -- not just PCs and television, but even those found in airplanes, automobiles, medical devices and technical equipment.” Referring to the draft’s including new “VEIL” technology as a supplement to CGMS-A protections, Petricone said “a key concern is that one of the 2 required copy protection technologies is largely unknown as to its cost, operation and licensing status. In addition, all key decisions would be left up to the Patent & Trademark Office (PTO). With due respect, it is unclear how the PTO could make these decisions, or who would exercise oversight over its judgment.”

As for legislation to authorize the FCC to reimpose video broadcast flag rules, Petricone said the draft is “close to a reinstatement” of the FCC’s original flag order. But CEA is concerned that it also grants “discretion to the FCC to change everything in the future,” Petricone said. CEA also believes the draft is “deficient” on addressing how the flag can be misused, he said: “We urge the committee to include narrow exceptions for local news and public affairs programming, and allow schools and libraries to use broadcast excerpts for distance learning.”

When Smith asked why CEA took a “neutral position” when broadcast flag rules were drafted at the FCC and argued before the Appeals Court, Petricone said CEA is a very large group whose members have had differing opinions on the question. With opinions so strong on both sides, Petricone said “sometimes the best thing to do is to stay out of it.”

Petricone -- responding to questions from Rep. Lofgren (D-Cal.) about the patent status of VEIL technology for analog hole protections -- said that remains unknown. Glickman said VEIL isn’t a technology “that came out of nowhere” -- it has come under intense review by industry discussion groups. He said VEIL has been endorsed by IBM and Thomson. Lofgren expressed strong reservations about vesting so much authority for VEIL in the PTO as the draft provides. She also said she believes govt. should tread lightly on mandating specific technologies, because it could mean going down a road that will turn out to be “unpleasant” within a few years. Glickman said MPAA wasn’t wedded to providing such a broad PTO role.

Public Knowledge Pres. Gigi Sohn told the subcommittee that just because her group opposes the 3 legislative drafts “doesn’t mean we oppose all content protection efforts.” But she said there are “far better alternatives to the heavy-handed technology mandates proposed today. They include a multi-pronged approach of consumer education, enforcement of copyright laws and use of technological tools developed in the marketplace.”

In her prepared testimony, Sohn urged the subcommittee to “think long and hard” before granting the FCC “such unbounded authority to control technological design,” as the Commission tried to exercise in the broadcast flag order her group and others helped convince the U.S. Appeals Court last spring to vacate. Broadcast flag “would put a government agency in the position of deciding what software and hardware technologies will come to market and which will fail,” Sohn said.

Sohn similarly urged the subcommittee to “weigh the costs to consumers” of giving the FCC authority to require an audio protection flag for digital radio, as an RIAA- backed legislative draft would do. “Efforts to limit what consumers can record over digital radio technologies suffer from many of the same maladies as the TV broadcast flag -- specifically government control over technology design,” Sohn said. She also said the bill would let the FCC “extinguish the long-protected consumer right” under the Audio Home Recording Act to record transmissions for personal use. Moreover, such a law could kill fledgling technologies like HD Radio, Sohn said: “Why would a consumer buy an expensive new digital broadcast radio receiver when it would have less functionality than the current analog receiver?”

She said “the broad, sweeping” draft to close the analog hole “suffers from the same problem; it puts the government in the role of making industrial policy, and will severely limit consumers’ ability to make lawful uses of copyrighted content.” Like broadcast flag rules, the analog hole draft would require “a one-size-fits-all technology that has not been the subject of public or even inter-industry scrutiny,” Sohn said.