December 14, 2008

The Future of the Internet III

Scenario 3: The Evolution of IP Law and Copyright Protection

Prediction and Reactions

PREDICTION:  Content control through copyright-protection technology dominates. In 2020, strict content controls are in place thanks to the efforts of legislatures, courts, the technology industry, and media companies. Those who use copyrighted materials are automatically billed by content owners, and Internet service providers automatically notify authorities when they identify clients who try to subvert this system. Protestors rarely prevail when they make claims that this interferes with free speech and stifles innovation.

Expert Respondents’ Reactions (N=578)
Mostly Agree 31%
Mostly Disagree  60%
Did Not Respond  9%

All Respondents’ Reactions (N=1,196)
Mostly Agree  31%
Mostly Disagree  61%
Did Not Respond  8%
Note:  Since results are based on a nonrandom sample, a margin of error cannot be computed. The “prediction” was composed to elicit responses and is not a formal forecast. 

Respondents were presented with a brief set of information outlining the status quo of the issue 2007 that prefaced this scenario. It read:

Major content producers such as the world’s music and film businesses are lobbying governments and courts to protect their assets. Digital rights management (DRM) is one of the umbrella terms used to describe various technologies being developed to help copyright holders control access to digital products and prevent copying. Its intent is to assure that content creators maintain control of their work and are rewarded with appropriate compensation. Opponents of DRM say its language and approach are geared toward forcing public acceptance of intellectual monopolies. They argue that the movement toward assigning ownership of everything stifles innovation and competition, saying DRM is actually “digital restrictions management,” and IP stands for “intellectual protectionism” and “intellectual poverty.”

Overview of Respondents’ Reactions

A number of predictors used the phrase “the horse is out of the barn,” implying the old paradigm of intellectual property (IP) protection is ineffective. Others talked of the “arms race,” implying that those who wish to access information without regard to law will continue to find ways to circumvent IP-control attempts. Still others referenced “continued co-existence,” suggesting that in the future content owners will sometimes expect monetary payment, but will sometimes offer their content free or in exchange for attention or other action. The varied themes among the “mostly disagree” responses to this scenario were dominated by two points: regulators will not arrive at universally-accepted policy; and people everywhere will continue to circumvent IP structures if regulatory guidelines are not enforced globally. Several respondents said they think the future of IP is “up to China.” Many dissenters believe that “cracking” technology will stay ahead of IP-control technology and that new economic models will be developed to deal with new realities of digital, online content. They argue that to gain a sizeable audience, most content will have to be offered for “free.” They project that regulation will be layered, and concepts such as Creative Commons will prosper.

Those who mostly agreed with the scenario said content will be privatized and kept under the control of media and/or telecommunications firms. They also suggest that content control may be reasserted by currently entrenched institutions that might control devices through hardware or software restrictions.

A significant majority disagreed with the idea of a dominant and successful copyright-protection system by the year 2020. Some people’s remarks echo Electronic Frontier Foundation co-founder John Perry Barlow’s 1994 essay on the changing nature of “ownership.”

Humanity now seems bent on creating a world economy primarily based on goods that take no material form. In doing so, we may be eliminating any predictable connection between creators and a fair reward for the utility or pleasure others may find in their works. Without that connection, and without a fundamental change in consciousness to accommodate its loss, we are building our future on furor, litigation, and institutionalized evasion of payment except in response to raw force…We’re going to have to look at information as though we’d never seen the stuff before…The economy of the future will be based on relationship rather than possession. It will be continuous rather than sequential. And finally, in the years to come, most human exchange will be virtual rather than physical, consisting not of stuff but the stuff of which dreams are made. Our future business will be conducted in a world made more of verbs than nouns.1

Some respondents noted that it is human nature to desire to acquire at no cost those things for which others pay a price. And some warned that extreme management of IP rights would not be worth the trade-off of the potential inherent in free and open communications networks.

“Digital rights management is fool’s gold,” wrote Michael Botein, founding director of the Media Law Center at New York University Law School. “Many people want IP protection, but everyone wants to steal. Regardless of the legal mechanisms so far—e.g., automatic damages, compulsory copyrights—many people would prefer the illegal route, perhaps because it runs up their adrenaline.”

“The dominant business plan will be access to attention, rather than access to content, so this scenario seems rather unlikely,” responded Oscar Gandy, author, activist, and emeritus professor of communication at the University of Pennsylvania.

Brad Templeton, chairman of the Electronic Frontier Foundation, commented, “While people will try to do this, it is so technologically intractable as to not succeed. Copying data is the natural state of computers; we would have to try to compromise them too much to support this regime.”

Some See Changes Coming at the Hardware Level

Several experts noted the ways in which digital rights management is already being exercised at an accelerating pace through the introduction of digital-information-access appliances or devices, like the iPhone, that are closed systems.

Steve Jones, co-founder of the Association of Internet Researchers and editor of New Media & Society commented, “While I applaud the efforts of DRM opponents, I am discouraged by the progress DRM seems to continue to make in hardware as much as in software. Having purchased an iPhone, I was delighted when Apple updated its software to allow custom ringtones, only to discover that I needed to pay for a ringtone via the iTunes Music Store even though the ringtone I wanted to use was one in which I own the copyright!”

Social media researcher danah boyd of Harvard University’s Berkman Center for Internet and Society referred to her colleague Jonathan Zittrain’s work in her response. In his 2008 book “The Future of the Internet—And How to Stop It,” Zittrain describes the pros and cons of “generative” technologies (wide open to innovation and contribution, with everything shared by all) and “non-generative” technologies (controlled, proprietary systems like cell phones and DVRs). “While the media and public are talking about DRM at a software level, the reality is playing out at a hardware level,” Boyd wrote. “Non-generative technologies are being produced, restricting users from nearly everything, often to protect DRM. New mobile handsets and Intel-based hardware are having DRM baked into the circuitry. This is a problem and, if this continues, strict controls are somewhat possible. While we are marching toward this scenario at a fast pace, I think that we’ll see a disruption before 2020. I’m not sure what the disruption will be. Ad hoc mesh networks? Foreign-produced technologies brought in on the black market? As long as we can record media and as long as we can share content online (through encrypted channels), there will be breaks in the system. Realistically, there will be a lot more. I think that the likelihood of devising bulletproof DRM is about as high as the likelihood of stopping spam.”

At least one respondent says hardware makers are going to see more profit if they support open information sharing. “Technological protection of intellectual property seems to make good business sense for copyright holders, particularly compared to the difficulties of enforcing these rights through slow and expensive justice systems,” wrote Lea Shaver, A2K (Access to Knowledge) program coordinator at the Yale Information Society Project. “But ultimately consumer demand for openness will largely prevail over the effort to preserve pre-digital business models. There will always be a market for new tools to subvert DRM, and the pace of innovation is much faster than that of the legal system. Just as important, the many companies who stand to gain from greater content openness—such as makers of hardware and providers of indexing and remixing services—are increasingly going to organize to block legislation that puts the teeth in DRM.”

New Economic Models Seen as Likely

A number of the respondents reflected some optimism that people living in a highly networked age will adjust to new ways of thinking about the exchange of goods and services, including what is now referred to as “intellectual property.” Louis Houle, president of the Quebec chapter of the Internet Society responded, “A new capitalism will rise with the Internet (only an infant now).” Fred Baker, Cisco Fellow and an architect of the Internet, noted, “The current attempts at DRM mostly curtail a growing business, and the business will eventually be allowed to grow.”

Paul Greenberg, president of The 56 Group LC, commented, “The fact that Gen Z or whatever they are called at the moment will have grown up in a peer-to-peer-empowered environment by 2020 will be (and is) the harbinger of social change that, when it comes to copyright control, will break down the traditional barriers that protect intellectual property.”

Paul Miller, technology evangelist for the United Kingdom-based company Talis, responded, “There is early evidence of a more pragmatic recognition that value is shifting. With a recasting of the value proposition with respect to content, it becomes less necessary to over-control the content itself, more useful to have that content widespread, and increasingly possible to recoup more revenue on value-added services built around the content and its community of use.”

Payment will come in new ways, according to Scott Smith, a futurist and consultant who formerly worked with Yankee Group and Jupiter. “By 2020, costs will be recovered in other ways,” he noted, “from subsidies built into device costs to live performance to embedded ads, but DRM-locked content will be in the minority for mass-market entertainment. Looser DRM systems designed to protect small producers may still be in place—a hybrid between Creative Commons and limited-play versions.”

Clay Shirky, author of “Here Comes Everybody” and a professor at New York University, agreed things will change, writing, “By 2020, alternative licensing regimes will have superseded the DRM rationale.”

Tze-Meng Tan of Multimedia Development Corporation, an architect of the Malaysian Internet, responded, “In 2020 most content will be distributed ‘free’ or for very low cost but supported by advertising, which will be embedded in the content.”

Jeff Jarvis, blogger at Buzzmachine.com, commented, “When audience and content can be metered and monetized, then it will be in the interest of copyright holders to have their content distributed as widely as possible, with the knowledge that this is how they will make money through advertising or through the expansion of their brands (that is, the reduction of their marketing costs).”

Thomas Quilty, president of BD Consulting, a firm that investigates software piracy, among other high-tech crimes, predicted that by 2020, “though content control is in place, competition in the form of royalty-free content competes with products with high usage fees. This competition forces the rights holders to lower their fees to be competitive. Additional changes to laws worldwide place restrictions on the length of time after creation of a work that fees can be changed, using a schedule where the fees are reduced and finally eliminated over time.”

Josh Quittner, executive editor of Fortune Magazine, formerly of Time Magazine and Business 2.0, and a longtime technology writer, responded, “As a content producer, my heart (or rather stomach) would like to see some form of IP protection going forward, but my brain tells me copyright will pretty much go away. From a tech perspective, I could see this going in either direction. If online advertising fails as a way to monetize content, I could see a micropayments system evolve‚ and that could easily go hand in hand with iron-clad DRM.”

Peter Kim, a senior analyst with Forrester Research who specializes in e-strategy, suggested, “the advertising model which supports media will collapse; both sides of DRM must learn to coexist, because content must be circulated with ease to build audiences and consumers alone cannot and will not subsidize the commercial model which incents artists to create.”

John Jordan, a professor of communications at the University of Wisconsin-Milwaukee, wrote, “The money to be made in technologies comes when user-consumers feel free to play and experiment. If all content is governed by a set of complex laws, user-consumers will feel stifled and will engage less with these technologies. They may not protest; they simply will withdraw. Once that happens, companies will be forced to realize that the content they offer and seek to protect will not, in fact, sell itself—they must instead accommodate user-consumer desires and ease restrictions in order to see growth.”

Many Say ‘Information Wants to be Free’

Many respondents said people will continue to get what they want at the price they are willing to pay; sometimes they will pay with their attention, sometimes with money, and sometimes with the decision to ignore politically constructed mechanisms established to compensate the creators of content. “You cannot stop a tide with a spoon,” responded Giulio Prisco, chief executive of Metafuturing Second Life, formerly of CERN. “Cracking technology will always be several steps ahead of DRM and content will be redistributed on anonymous networks.”

“Information will always want to be free,” wrote Fabrice Florin, executive director of NewsTrust.net, “and repeated attempts by governments and media companies to impose a digital rights management system will remain largely unsuccessful.”  Dan Lynch, founder of CyberCash and Interop Company, now a board member of the Santa Fe Institute, commented, “Copyright is a dead duck in a digital world. The old regime based its power on high distribution costs. Those costs are going to zero. Bye-bye DRM.”

Geoff Arnold, senior principal and software development engineer for Amazon.com, responded, “This is a classic ‘arms-race,’ but in this case technology is going to be decisive. Every individual will have access to sufficient computing power to simulate every relevant content consumption use-case, and DRM won’t be able to keep up.”

Christine Satchell, senior researcher at the Institute for Creative Industries and Innovation at Queensland University of Technology, agreed, writing, “Users will always find a way to overcome barriers put up by those with sheer interest of generating capital, and industry will have to look at ways of aligning themselves with a new generation of savvy users.”

One respondent said he wished he could choose to “totally disagree” with the scenario. Richard Hall, co-director of the Laboratory for Information Technology Evaluation at the Missouri University of Science and Technology, commented, “As long as network neutrality remains in place, there is no way that DRM will survive, not just because the technologies will always be hacked, but, also because the philosophy behind it is so onerous and evil.  All through our history, if we owned a physical device, the device did what we wanted. When I purchased a record it played on any record player and if I wanted to record it for my own use, of course I could.  Once people truly come to understand the nature of DRM: 1) I don’t actually own things that I purchase; and 2) I am punished (e.g., my media won’t play on my own players) because someone else might commit a crime. They absolutely won’t stand for it, and, once this philosophy is widely understood, the open Web will send it crumbling to pieces more and more, and politicians will have to work with the will of the people. One other issue is to keep in mind (though it’s more abstract, and people may not respond) is that virtually all innovation occurs when one thing builds on another, and that is why the law has always held that intellectual property is not eternal like physical property.”

Alexander Halavais, a professor and social informatics researcher at Quinnipiac University, wrote, “While I have little doubt that there will be strife and problems with the interpretation of copyright in 12 years, we’ll be seeing support for access to knowledge and knowledge commons, particularly in the international context.”

Christine Boese, researcher and analyst for Avenue A-Razorfish and Microsoft, commented, “The people who are intent on destroying the public commons with excessive digital rights management controls and strictures may win some battles, but they will lose the war, may have already lost it. They killed their own golden goose. Cultural forces are much stronger than corporate fascists, and whatever they seek now to block will simply arise from other providers in other sectors, even if it means a return to singing around campfires and pianos, or making homegrown media products. Here’s a thought: maybe as the digital-rights-management Nazis kill their golden goose, they will also force creatives beyond excessive postmodernist remixing as an aesthetic, and artists of all stripes will start to value ‘originality’ over ‘derivation.’”

Some Suggest Alternative Methods of Protecting Rights and Predict that Adaptations Will Emerge

There will still be some controls, but they will come under a different system, according to many survey participants. Nicholas Carr, author of “The Big Switch: Rewiring the World, from Edison to Google,” wrote, “By 2020, there will likely be a monthly arts fee added to ISPs’ Internet-access charges, and the resulting pool of money will be split among copyright-holders depending on usage. The fee will give users unfettered access to most copyrighted works.”

Susan Thomas of S2 Enterprises LLC agreed, adding, “Content control through copyright cannot prevail. What IS likely is that access to the Internet will be controlled, and Internet service providers will charge a toll at the onramps.”

Some expect that added scaffolding of regulation will make IP law work better than it is now. “There will be multiple levels of copyrights, some with very few restrictions,” wrote David Moschella, global research director for Computer Sciences Corporation’s Leading Edge Forum, a Computerworld columnist.

“New forms of cooperation will emerge which are less win/lose,” predicted Mary Ann Allison, principal of The Allison Group. “Commons will become a standard.”

“UGC [user-generated content], creative commons, and open source are too powerful to suggest that the strict standards and complete micropayment systems these scenarios describe will be universal standards,” responded Susan Mernit, an independent consultant and former senior director for product development at Yahoo! “I think we will see parallel systems for content and copyright management—the ‘integrated systems’ that are walled gardens much like AOL was for an ISP in the ’90s, and the ‘open media/open source’ distribution sites that are smaller, more fragmented and that represent the long tail. The popular wisdom of crowds will dictate what is most popular, and payment structures will vary.”

“We’re already seeing new models of shared, commons-type ownership,” commented Cameron Norman, a professor at the University of Toronto. “It will continue because in too many cases the free ownership or shared products are simply better and more responsive. The ability for open-sourced products to respond as we get faster and faster in terms of turnaround in all sectors will continue and the old ways of copyright only limit that.”

Havi Hoffman, of the Yahoo Developer network noted, “In a perpetual panopticon (superveillant society) most media consumption will be trackable. But an alternative economy of reputation and information intermediation could begin to develop in parallel to the money system, which even today is traumatized by the technology of total connectivity.”

Clement Chau, research manager for the Developmental Technologies Research Group at Tufts University, commented, “As the world begins to assimilate into a culture where creativity is collaborative and participatory, and where the lines between the audience and the creator are blurred, IP and authorship will be redefined. Rather than creators having the ‘rights to own’ intellectual property, audience will pay to have the ‘rights to participate.’”

Regulators Are Likely to Remain at Odds

Some respondents do not think the industries and political groups involved in digital rights management will be able to find enough common ground internationally to secure more complete control. “Things will stay lumpy and unpredictable for the DRM world,” wrote Susan Crawford, an ICANN board member and visiting professor at Yale Law School. “I see two alternatives here. If network providers, law enforcement, and content companies continue along their present European path towards authentication, retention, surveillance, and control of every possible online communication, and if this route is adopted by the rest of the world, then—yes, DRM becomes perfect, perfectly-charged for, perfectly controlled.  But the world is a diverse and competitive place. Somewhere, somehow, there will be countries and network providers who just don’t want to go along.  There will even be competitors in providing DRM technologies who don’t want to go along.”

Robin Gunston, a consulting futurist for Mariri Consulting, wrote, “The only way this scenario can come about is if Asian countries agree to this accord, which I believe will take far longer than 2020.” An anonymous survey participant wrote, “No chance. Too many legal entities in the world.”

And Hal Varian, chief economist for Google, wrote, “Regardless of whether one thinks DRM is desirable or not, the coordination (in standards setting) and competition problems (inevitable due to zero marginal cost) are too great to overcome.”

Many respondents see the system surviving to 2020 as it is currently tiered. “The world will be increasingly divided between creators of proprietary content and creators of open-source content; two worlds with different kinds of information ecologies,” commented Joan Connell, the online editor for The Nation magazine, formerly an executive producer for MSNBC.com.

“The situation will be much like it is today and much like it was 100 years ago—major content producers will continue to find new ways to over-protect their investments and consumers will continue to find ways to subvert these systems,” noted Alexis Turner, Webmaster at Greenwood Publishing Group in New York. “Cat and mouse are eternal.”

DRM and IP Law Have Support

There were some respondents who expressed satisfaction with the current trends in digital rights management and IP law. “You don’t have to read Marx or Foucault (though it helps) to understand that, contrary to 1990s techno-utopianism, power tends to replicate itself, no matter how ‘democratizing’ or otherwise liberating a new technology may appear to be,” wrote Charles Ess, a researcher on online culture at ethics at Drury University. “…While there will be modestly successful resistance at the margins, most of us, most of the time, will find ourselves happy to drop 99 cents for a song from the iTunes store rather than fuss with copy protection workarounds.”

Johanna Sharpe, senior marketing manager for Microsoft, commented, “DRM is important and critical in helping protect IP. New DRM tools that digitally protect copyright materials give attribution between content owners and producers and their work so I don’t believe using DRM is too restrictive. The arguments against DRM are weak, in my opinion. On the flip side, legislation that is too over-broad in shutting down all P2P [person-to-person] networks, and P2P innovation, doesn’t make sense. P2P networks could be viable tools to educate and share information between groups, so it isn’t in the public’s best interest to shut down these technologies, just the exploitation of copyright infringement via networks. There has to be a balance between technology innovation and usage rights where people or companies are fairly compensated and technologies can advance to drive more open real-time communications online.”

William Winton, product manager of digital media for the 1105 Government Information Group, commented, “The Licensing Act of 1662 was greeted by many as the potential downfall of the free press. History proved this assumption wrong-indeed, English literature and art flourished in the Restoration Period as never before. The seemingly eternal give-and-take between the creator, publisher and public in regards to intellectual rights will not abate. Only a strong, fair and effective system of digital content control will enable artistic expression to flourish, while at the same time protecting the substantial investments that are required to enable such expression.”

Some Agreed with the Scenario

Few of the respondents to this survey appear to be supporters of a perfected, global digital-rights-management system or universal law of intellectual property—the word “draconian” was used often by respondents in reference to the scenario presented. A significant majority either answered it cannot happen or said they wish it would not come about but think it likely. “This is the ‘Big Brother’ trend we anticipate in 2020,” commented Janet D. Cohen, blogger, futurist, and trend analyst.

“This scenario is likely, as the result of an increasing share of Internet access delivered via a smaller number of global wireless providers and partnerships (driven by threat of lawsuits) between these wireless providers and content producers,” noted Timothy McManus of Nuance Communications. And Seth Finkelstein, author of the Infothought blog, wrote, “Much of this is the case now! Note my ‘mostly agree’ response doesn’t indicate endorsement.”

Steve Goldstein, ICANN board member formerly of the US National Science Foundation, responded, “My main reason for agreeing is the increasingly oligarchic evolution of the service-provision marketplace. I would further predict that there will be cross-linking of content-provider giants and Internet-service-provider giants and that they will find ways to milk every last ‘currency unit’ out of the unwitting and defenseless consumer. Governments will be strongly influenced by the business conglomerates and will not do much to protect consumers. (Just think of the outrageous rates charged by cable and phone company TV providers and wireless phone providers today—it will only get worse.)”

Catherine Fitzpatrick, a lecturer on humanitarian issues with the Open Society Institute, wrote, “Despite the strenuous efforts of the copyleft movement, no viable business model has emerged or will likely emerge to pay artists who create content in any other way but in selling copies of their content which they must therefore copyright. Making the content free hinges on a philosophy that the state or philanthropy must pay all content creators, and that has many troubling ramifications for the freedom and viability of content creation. ISPs will simply find ways to bill for microchunks of content more expertly and efficiently, and, as more and more people monetize time online, billing micropayments will become normalized.”

“Much as I would like to see openness and abundance triumph, I don’t see any political will to overturn the Digital Millennium Copyright Act,” wrote Internet sociologist and author Howard Rheingold. “To the contrary, other countries, most notably and recently Canada, are turning to similar legislation. Incumbent culture industries have the ears and pocketbooks of political leaders in the USA—witness how the USA has slipped from the inventors of the Internet to number fifteen in broadband Internet access.   There are plenty of hopeful signs—both iTunes and Amazon are stripping DRM from downloadable music because that is what music customers demand. Free Culture is a growing anti-enclosure movement. Digital technologies continue to enable infinite reproducibility. But at this point, only a highly caffeinated optimistic could make hopeful signs into a strong argument that the forces for enclosure might lose. Right now, the RIAA, MPAA, and other copyright abusers are winning.”