Archive for November, 2012

IP Issues Paper 42 – Costs

IP Issues Paper 42 – Costs

Introductory notes

The Copyright Act imposes transaction costs on everybody, not just participants in the economy. In order to work with any “content” then there is a cost involved in ensuring that the content is properly licensed. This is even present when no formal licence is necessary. For example, in July a year or two ago the University of Berkeley in California moved all of their online recordings of lectures from their own service to Apple’s iTunes product. Apple iTunes is a proprietary layer on top of the HTTP protocol and, in practice the content on iTunes cannot be accessed by users of the Linux or Android operating systems. As a result I started an archival project at to recover as many of these recordings as I could. In the process I corresponded with one person by e-mail who said that they had wanted to do the same thing but didn’t think they were allowed to. This, despite the fact that all of these recordings have been explicitly licensed under a Creative Commons licence. This person had declined to do something that he was legally entitled to merely because of the risks created by the copyright law. I have no doubt that this is not an isolated case.

IP Issues Paper 42 – Moral Rights

IP Issues Paper 42 – Moral Rights

Introductory notes

As an individual are very sympathetic towards the moral rights of attribution and against false attribution.  That said, from a policy perspective it may not be appropriate to have broad based rights to prevent false attribution or to require attribution in relation to copyrighted works. I refer in this respect to the experience of the open source community in relation to the licence known as the “BSD” licence. This licence, originally propagated by the University of Berkeley in its initial forms required that attribution be given to the original authors of the work. However, as time went by others participated in the development of the work and also sought to have attribution of their contributions recognised. Over time the community of participants using software licensed under the BSD license came to the conclusion that compliance with this attribution requirement was not justified. While they did not object to the principal of attribution per se, as a matter of practice the attribution requirement was more harmful then beneficial on balance. As a result that community lobbied the University of Berkeley and secured a change to the licence conditions removing the attribution requirement. Whether the “reasonableness” qualification  on the attribution requirement is sufficient in practice is an open question. There ought to be broad-based exceptions are to these rights sufficient to permit the emergence of a broad-based aftermarket. The right of integrity is inconsistent with an author placing the work in the public sphere.  There should be a general exception to the right of integrity where the work in question has been made publicly available.

IP Issues Paper 42 – Reflecting the Views of Owners

IP Issues Paper 42 – Reflecting the Views of Owners

We have argued here that copyright policy is currently set by the minority 1% of copyright owners.

Not only are Copyright owner is unrepresented in the Copyright policy-making process, to the extent that they participate in the process they are rebuffed.  For example, over the past 10 years initiatives designed to either make the operation of the copyright law more fair, such as Phillips Fox review or less discriminatory such as the reports of the House of Representatives and of the Senate Select Committees relating to the AUSFTA have not been implemented.  Indeed, even apparently obvious reforms backed by substantive, well considered analyses such as that on parallel importation have been left by the wayside.  At the same time initiatives designed to discriminate in favour of the vocal 1% have been passed into law time and time again (such as chapter 17 of the AUSFTA, and legislative changes off the back of the Cracking Down on Copycats Review).

If the copyright law is to be reflective of the interests of these 99% of copyright owners then more weight needs to be given to their interests and less to those traditionally having influence in copyright discussions. Because the vast majority of copyright owners have no representation securing their views on copyright policy is difficult. Organisations such as libraries which have traditionally represented “users” only represent a niche interest of those copyright owners – that is, those owners to the extent that they use a library.

As a consequence, policy makers ought to give much more weight to the views of those organisations primarily responsible for the creation and dissemination of content – that is, organisations such as Google, WordPress, Firefox, Sourceforge, Github,, file locker services and so on. These organisations are responsible for assisting or facilitating the creation or dissemination of orders of magnitude more copyright works by the 99% copyright majority than are produced by the 1% copyright minority.

Conflicts note: While I hold accounts with some of these services, but have not been engaged for reward by any companies associated with them.  I have previously acted for the Australian Digital Alliance.


IP Issues Paper 42 – After markets

IP Issues Paper 42 – After markets

Introductory notes

The structure of the rights that Copyright law are specifically designed to allow copyright holders to control the aftermarket for the goods that they sell. It is this characteristic which distinguishes “intellectual” property from actual property. In so doing the legislature has effectively greatly reduced the possible scope of application of the Copyright act. By expressly contemplating control of after markets the legislature has imposed compliance costs upon everyone who might participate in such an aftermarket.

It would be ludicrous to suggest that the maker of nails ought to have some rights in a building created through the use of those nails after they had been purchased by purchaser. However, not only does the Copyright Act endorse such an approach, it actually presumes that the value of the house comes from the nails. The control of after markets in this manner is poor policy. The reason it is poor policy is because it creates a pyramid of obligations as between each potential purchaser in the after markets and the original seller of the nails. Moreover, unlike the situation where objects, such as nails, are purchased there are no set rules governing the transaction. Thus, each seller of copyright nails has their own terms and conditions regulating the aftermarket for their own nails. Where a person buys actual nails their rights in relation to the nails are set by custom – that is when they purchased them title transfers to them and that title is unencumbered. Indeed, the lack of encumbrance is enshrined in consumer legislation.

It is certainly possible for property law to support the control of after markets through, example lease leasing and  licensing structures. Tthere is no reason in law why nails could be not “sold” on a licensing basis, with the title in the nails remaining with the original manufacturer. The only reason that this is not happen in practice is that it would be unworkable.  We have already seen such a system in place in relation to real property in the feudal period in England. At the time, the King retained (“allodial”) title in most of the lands land within the domain, with feudal grants being made to lords subject to those lords swearing fealty and undertaking various services to the king (typically knight service). Initially this approach to the holding of land was somewhat sensible but only because there were comparatively few feudal lords and land grants. However, over time the lords chose to sub-infeudate their holdings to lower, or “mense” lords who, in turn, apportioned out lots to individual tenants.  At each level rights in relation to the land were subject to the performance of feudal services. Often the terms upon which tenancies were granted was that the alienation of the land the subject of the tenancy was subject to the approval of the overlord or the king. This created an immense administrative burden tracking and enforcing compliance with this multitude of mutual obligations. The realm recognised that this system was unworkable and passed the statute of Quia Emptores.  This effectively collapsed the pyramid of obligations by substituting newly subinfeudated tenants rather than adding them to the end of the chain of obligations.

It is not appropriate for the legislature to expect that copyright works, which may sell for as little as one dollar to be subject to a licensing structure. The transaction costs involved in determining the scope of the licence and whether a particular use is within scope of the licence granted will, for the vast majority of works, greatly exceed the value of the work itself. This is more so the case as the number of vendors increases. Indeed, this licensing structure can only play a significant role in the economy where the number of vendors and, therefore, the number of licences which may apply he is extremely small. That is, this is a market for the vocal 1%.

By permitting the control of after markets the legislature has robbed certainty from the economy. There have been a number of examples where the purchasers of of electronic materials have had their access to materials restricted or revoked subsequent to their purchase. One would wonder about the wisdom of permitting the manufacturer of nails to recover nails already used to make a house.  Once copyright litigation becomes widespread (cf Rightshaven litigation) the full effects of this poor policy will begin to really show themselves.

IP Issues Paper 42 – Reframing the Owners

IP Issues Paper 42 – Reframing the Owners

Introductory notes

While the terms of the ALRC’s reference do not refer to the words “owners” for “users” the discussion paper itself implicitly assumes that there is a distinction between these two groups of people. In my view, such an approach is not appropriate.  The “users” v “owners” dichotomy is a persistent meme in copyright law, as is  that the establishment of rights in respect of copyright involves a “balancing” of the rights of “creators” and “owners” against the rights of “users”. To argue such a distinction today is inconsistent with reality.

At the time of the invention of the printing press and its dissemination and industrialisation from the 15th through to the 17th centuries in Europe, and particularly in England, the most logical way in which one could acquire a copy of a work was through a publisher of that work publishing it with a printing press. As presses were comparatively expensive and required technical skills in order to operate there were also comparatively few of them. Moreover, as a result of the religious strife in England following the death of Henry VIII the government had an interest in regulating, the use of printing presses (as presses were used to print seditious material, primarily by way of pamphlet).

The government created a monopoly in printing in favour of the Stationers Company which survived as a matter of practice (if not legal formality) through to the establishment of the Statute of Anne in 1709 and continued on with renewed vigour after the passage of that Act. In those circumstances it is easy to draw a direct line from an author through a publisher to a distributor, retailer and retailer and ultimate “user”. In this case, the buyer of the publication. In those days there was little opportunity for there to be a return path from that “user” back to the original author of the book, or, indeed, between other “users”. While “users” likely engaged in written correspondence with others the dissemination of that correspondence was greatly limited by the available technologies. In these circumstances it is, at least understandable that one might separate these people into two distinct groups – those who are giving and those who are receiving the work.

Reference for copyright history: Copyright in a Frictionless World

In today’s world such a distinction is no longer tenable. When a person visits Wikipedia and, seeing in an entry which is incorrect writes more work to replace that incorrect entry that person is not rapidly change hats transforming, from one moment as a “user”, then an “owner” then reverting back to a “user” from one moment to the next. Rather, they remain an owner of copyright for the entire time. Yet these owners are invisible for the purposes of the Copyright Act and policy making in relation to it. They are almost completely unrepresented in any discussion in the interests are not only ignored, but marginalised and, to some extent, vilified – witness the propaganda against the iiNets and Googles of this world.

The scope of protection afforded under copyright law is extremely broad. There is a very low bar of originality which must be met before a work, which has been reduced to material form will support the subsistence of Copyright. Of the over 20 million residents of Australia the vast majority are copyright “owners” (in that there exists at least one copyright which vests in that person). Of these a bare 200,000 or so – a little less than 1% of the total (even on generous estimates) are represented by collecting societies, publishers and those organisations usually purporting to speak on behalf of copyright “owners”.

To the extent that Copyright law is purported to be made in the interests of these “owners” it is discriminating in favour of the interests of a vocal 1%. One might imagine a property law in which the only property owners involved in the rights setting were those who owned large commercial blocks or the owners of shopping centres. It would not be surprising in such a setting for that small group of property owners to set rules in such a way that effectively stripped rights from the others and to justify in the interests of their “property” rights.  Such a world might have, for example fast–tracked development application processes and discriminatory rights of acquisition as against other property owners. Such a system would be neither fair nor representative. It is important to recognise that this system will also never evolve into a competitive economy because it creates special rules which favour a small group, effectively excluding the majority of potential participants.

IP Issues Paper 42 – Intro

IP Issues Paper 42 – Intro

The Federal Attorney General has requested the ALRC to enquire and report as to whether the “exceptions and statutory licences in the Copyright Act 1968, are adequate and appropriate in the digital environment.” The ALRC has released a discussion paper, some 80 pages in length, canvassing the issues related to exceptions to the Copyright Act.

Copyright is so divorced from reality at the moment that any restriction of its operation would be welcome. It is unfortunate, however, that the ALRC’s consideration is limited to the scope of exceptions to infringement within the Act as it is the rights themselves which are in need of subjugation. Indeed, it is my view that, unless and until copyright is reformed in such a way as to make the rights analogous to those rights in physical property the objectives sought to be achieved by the review – for example the promotion of innovation and dissemination of copyright works – will not be achieved.

Note on use of “copyright work”

The Act draws a distinction between works and subject matter other than works. It is cumbersome to be true to this distinction and yet provide an argument with a natural flow when having to constantly refer to works and/or subject matter other than works. The word “work” is used here as a matter of convenience, but should be read as a reference to all kinds of material in which copyright subsists.

Moronic Optus Password Requirements

Optus require me to change my password.

They reject “OptusAreABunchOfDope5” (despite its javascript algorithm marking the password as “strong”)

because, apparently, I can’t have a password which contains dictionary words.

However, they happily accept:


as a password – Don’t worry, I have changed it ;0

I ask you, which of these would be easier to crack?


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