Antigua, China, the WTO and the US

Anyone in the online gambling industry, like my friend Joe Deacon, is well aware of the restrictions of the US gambling regulations. For those of you coming across this story for the first time there is a good timeline at Techdirt.

In short Antigua is arguing that the US is breaking the terms of its trade agreement with them by disallowing US citizens from placing bets. The WTO made a ruling in Antigua’s favour and since then the US has been trying all manner of tactics to wriggle out of liability even to the point of unilaterally altering the terms of the trade agreements to exclude online gambling.  

This story does get crazy though. Antigua is pushing for the WTO to rule that as compensation for US breaking the trade agreement Antigua may infringe copyrights of music/film. Aside from being an unusual and headline-grabbing form of compensation it is fraught with mis-application. Firstly it might be prohibited by Antiguan copyright laws and secondly how would Antigua ensure that the copyright owner is US avoidnig inadvertant copyright infringement on content from another country.

It is hard to take this situation seriously but will no doubt get some press as it plays out.

Meanwhile the US has requested that the WTO make a ruling on the complaint against China regarding copyright piracy made a few months ago. The complaint is not only about copyright infringment but includes issues relating to local Chinese law putting Western companies at a disadvantage in the distribution of entertainment products. More here.

French ISP enhances offering with (unlicensed) music services

Music companies and ISPs have an uneasy relationship at the moment in many European countries as the music industry tries to get ISPs to take some responsibility for the illegal traffic passing through their networks.

Neuf Cegetel, a French ISP, recently announced a new music venture offering free downloads from the Universal Music catalogue to new broadband sign-ups. In response Free.fr announced a new deal with Deezer.com to provide the music for its homepage. Deezer used to be Blogmusik.net and was closed down earlier this year. SACEM, the French publishers society, has licensed Deezer, but Universal Music has asked for its catalog to be withdrawn.

In the Ratiatum article the point is raised that SACEM could grant a license if Deezer was considered like radio, but this is unlikely and as such each music company (like Universal) must strike it’s own deal with the service.

It is not surprising that Free would launch an attack against Neuf Cegetel’s offer, but to do so with a service that has only the agreement of the publishers society is a faux pas in the eyes of the music companies.

Meanwhile Deezer is laughing as it’s traffic of French visitors increases enormously taking it from an Alexa ranking of about 70,000 3 weeks ago to nearer 1,500 this week. Although today the site is down with a note saying it will be back tomorrow – for legal reasons or because it can’t cope with the volume of visitors?

Car copying in China

It’s not digital piracy but following Chinese IP issues is something I like to keep up with. The BBC reports that BMW and DaimlerChrysler have made claims that a Chinese carmaker has copied their designs, and that they may commence legal action.

Fingerprinting

An interesting article in the Guardian about fingerprinting videos and the issues it poses, how tech vendors are using different ways to counter the fact that hash recognition can easily be circumvented, and how it is an issue to YouTube.

The article really gets interesting at then end, where it talks about commercial value in the fingerprint itself being one of the reasons YouTube has gone it’s own way with developing a fingerprint solution rather than buying in from the likes of Audible Magic.

Also raised is the possiblity of targeting advertising by using a watermark to know what someone is watching:

“If someone could make money by generating ads just because a viewer watched [part of the film] Transformers, Paramount would want to be involved in that,” Ishikawa says. He warns content owners not to give up their content without a financial agreement: “They will be a commercial asset.”

New Zealand over-zealous in changes to copyright bill

In New Zealand a government committee has amended a proposed copyright bill with some surprises.

• Copyright owners are to be fined up to $100,000 for recklesly false takedown notices which seems a bit harsh.
• ISPs are under no obligation to remove infringing content unless they receive notice from a rights holder even if they know or suspect the content to be infringing copyright
• A new category of work has been created called a “communication work” which gives news rights of authorship to those involved in it’s transmission.

On this last one what are they thinking? How will these new rights dovetail with existing authorial rights?

The Committee recommended the bill be passed so we’ll keep watching.

Tel père, tel fils

Ars Technica report on a new EC sponsored Eurobarometer survey, with the great headline ‘Papa pirates, so I do, too’.  The survey of 29 countries, which suggests Euroteens online behaviours are converging, is interesting partly because the audience surveyed is so young – 9-10 and 12-14 years old.

Predictably downloading music/film/video/games is more widespread among the older age group, and boys in particular. Excuses are rife since it appears to the kids surveyed that everyone is doing it, even their parents.

A comment I have heard previously, that reappears in this survey, is that if something is illegal it would not be on the internet. It’s worrying that kids might have a trust of the medium that is this deep.

Their biggest fear, on the other hand,  appears to be getting a PC virus!

 The report itself is here – p. 54 for the sectoin on illegal downloading.

Copyright in India

There is a lot of focus in the digital entertainment industries on the opportunities and threats in China. So much so that often India with it’s 1.1 billion population is overlooked. India has some strange non-digital anomalies, like the popularity of music cassettes (rest of market is 67% CDs, 9% digital), and the widely reported infrastructure issues conspire to make India seem a less sure bet than China.

India also has a popular film tradition, known as Bollywood, and a large percentage of music is of domestic origin (91% according to IFPI). However, a large population of English speakers, a growing middle class, a legal system based on the English system (i.e. includes acknowledgement of copyright) and a rapid rate of mobile subscriber growth , all suggest many opportunities for Anglo-American content owners.

Here’s a helpful FAQ targetted at startups in the digital media space about copyright in India.

And if you thought I was joking above about cassettes  – among the top independent labels in India are Super Cassettes Industries and Venus Records and Tapes Ltd.!

The cost of policing digital piracy

The Wired blog runs this piece based on a WSJ article about US company Bay TSP and the work they do for content owners. What strikes me most about the article is the cost and the inefficiency of the whole process. Fair enough humans need to be involved – but $11 an hour for that kind of work. Prime candidate for offshoring. Some clients pay $500,000 a month for Bay’s services!

And classic quotes on the inefficiency of the scheme:

• “‘By the time I send notices and take them down, they’ll be reposted,’ says [BayTSP analyst] Justin Hernandez…”
• “When YouTube receives such [takedown request] emails, employees review them and then remove the clips.” 

Whackamole, cat-and-mouse, whatever you want to call it this process of finding copyrighted material and issuing takedowns has to be improved to be in anyway worthwhile for the content owners. In addition, when a service is licensed, the content identification still has to work. All the major labels are now signed up with YouTube and must have or be seeking answers to questions such as  – does the content owner get paid when a member of the public uploads? does YouTube track geography of user? who gets paid when labels have rights for same material in different countries, and so on.  I suspect most labels will be looking to fingerprinting to handle some of this. Whether it can remains to be seen. 

China piracy – a brief look at the Sinascape

Every time I start to write about China it feels like there are too many things going on at once and the challenge is to pick the one or two key points worth talking about. I came across this article on Gary Gang Xu who has written a book on the current state of Chinese cinema.

Xu fills out the detail on the power struggle between US and Asian cinema which was understandably missing from MPAA’s report published last year (and re-iterated this year by the local China Film Copyright Association).

Xu tells us that pirating Hollywood films is widely tolerated – no surprised there. But what is more interesting is how Chinese films are not ignored by the pirates (as some sources have suggested) but are widely pirated and act as widely distributed adverts for a subsequent TV series bearing the same name. Apparently that is where the directors make their money, althout Xu also tells us that TV series are widely pirated too!

The change in the direction of the flow of cultural goods – i.e. historically from US to Asia, and now in both directions – may in the future provide an impetus to Chinese content owners to press for more rigorous protection of their copyrighted material.

The Musically newsletter recently reported on Music Label Competition in China and talked about how the “Chinese diaspora” may be a large future market for the music emanating from Chinese/Hong Kong/ Taiwan labels which currently constitues 60%  of the Chinese recorded music market (80% according to some other sources).

The first commercial music download services are launching, with locally priced subscriptions. Digital makes up at least 30% of revenues for labels. The expected popularity of mobile services makes it slightly easier to police soem casual piracy.

But when these Chinese labels start selling throgh digital services to Chinese overseas they may start to get an inkling of what their revenues might increase to if they could sell to the domestic market. At this point self-interest would dictate that they seek to minimise losses from piracy and turn to the government to take copyright issues and enforcement seriously.

With no obvious model to benefit from piracy like the pirated films promoting tv, and the other film model whereby Hollywood remakes Chinese films, Chinese music producers clearly have a different set of problems and interests which may be more aligned with the interests of the global recording industry than the Chinese moviemakers’ interests are aligned with the MPAA.