It whips the llama’s ass.
In a previous post we provided the background of what some call the Copyright Wars, delineating the sides and the parties. While legal conflicts about copyright have been raging since its inception, this post will only cover the modern conflicts that arose after the Internet came into being. This short narrative is centred around online conflicts, and the intention is to provide some more background given the growing wider interest in this debate.
The early skirmishes
It may not come as a surprise that copyright was one of the first fields of litigation against what was then a fledgling technology called the World Wide Web.The first thing that courts had to decide was what exactly was the Internet for legal purposes (Shetland Times v Wills), and whether making a digital copy would be copyright infringement (MAI Systems Corp. v. Peak Computer).
Once the basics were settled, most cases started being waged against early Internet service providers (ISPs) as these were being used to commit illicit acts, such as criminal activity and defamation (eg. the infamous Stratton Oakmont v. Prodigy). Many of these cases were fought on the issue of copyright infringement. Digitisation meant that the Internet became a place to share copyright works, and some copyright holders started suing both users and the intermediaries who made it possible to transfer those files. As the law had not been shaped fully, the results are varied, and most took place in the US.
With regards to intermediaries, there were lots of cases, One of the first cases dealing with this issue is Playboy Enterprises v. Frena (1993), which is usually considered one of the earliest internet copyright cases, this involved a bulletin board service (BBS) operator who allowed users that upload and download copyrighted Playboy images. The court found the BBS operator liable for copyright infringement, even though he didn’t personally upload the images. A similar result was found in Sega v. MAPHIA (1994), which also dealt with a BBS that distributed pirated Sega video games. The court ruled that the BBS operators could be held liable for contributory copyright infringement by facilitating the illegal sharing of copyrighted games. However, in Religious Technology Center v. Netcom (1995), the court ruled that Netcom, as an ISP, was not directly liable for copyrighted Scientology materials posted by a user, establishing an important precedent that ISPs are not automatically responsible for user-generated content.
These cases helped establish important principles for internet copyright, such as the fact that ISPs are not automatically liable for user infringement, but they could be found if they were facilitating copyright infringement.
First regulatory response
The mixed results in these early cases meant that some important questions were in need of legal resolution. While the tech industry was not particularly powerful at that time, it was clear that the Internet would become an important part of the economy, and therefore there would have to be some compromise that would allow ISPs to operate without fear of getting sued all of the time. So between 1995 and 2000 we see several laws and treaties enacted that created a limitation of liability for intermediaries. This took place mostly in the Digital Millennium Copyright Act in the US, and the e-commerce Directive in the EU.
These laws set out a regime of limitation of liability for intermediaries which allowed them to operate as long as they had no knowledge of specific infringement taking place, and established mechanisms for copyright owners to let them know that a user was infringing copyright, and they would remove it promptly. This limitation of liability is one of the biggest pillars of copyright minimalism, and one that was obtained mostly with no pushback from copyright owners, who also saw the benefits of the Internet. A related minimalist principle is the one that allows for the technical operation of the Internet, at its most basic indexing and scraping the Web is an act of infringement as it creates copies of a work. The same happens with other technical processes, such as creating local copies of files (caching), and even copies stored in content delivery networks to make retrieval faster. All of these have been allowed to exist as exceptions to copyright because of their overall benefit to society.
While some important exceptions were gained, this period also saw some of the biggest advances in copyright protection. In the US the Sonny Bono Copyright Term Extension Act 1998 was one of the pieces of legislation around the world that extended the length of copyright protection to lifetime +70 years (with different variations relating of time of publication). Internationally, the WIPO Copyright Treaty presented perhaps one of the largest enhancements to copyright protections in a generation, the treaty added and/or expanded the exclusive rights of distribution, rental, and communication to the public, which were enacted to respond to the threat of the Internet. Similarly, the WCT implemented strong protection for technological protection measures and rights management information, also designed to protect things like DRM. The WCT also reinstates the applicability of the three-step-test for all of the Berne rights and the WCT exclusive rights.
The reason for this incredible extension of rights is that international bodies such as WIPO were able to respond quicker to maximalist interests, as least developed countries and the tech industry did not have a lot of power, so there was practically no opposition to these rights. The WCT was implemented in the US with the DMCA, and the EU with the Infosoc Directive 2001. All of this in time for the biggest battle in the Copyright Wars.
Napster and P2P
It would be impossible to convey to people just how big Napster was at the time. Before its launch on June 1999, music filesharing was performed in IRC channels and dubious FTP servers, and it was mostly done by music-obsessed nerds such as Yours Truly. Napster made piracy mainstream, allowing people from across the world to connect to one another to share MP3s. And everyone knew that it couldn’t possibly last, and of course it was the first casualty of this stage of the Copyright Wars. But while Napster was quickly removed by a lawsuit, countless other services started to emerge, sometimes using different technologies such as peer-to-peer and later Torrents.
So we have the golden age of filesharing: Aimster, Grokster, Kazaa, Gnutella, eDonkey2000, Limewire, Morpheus, eMule, KCEasy, BitTorrent, the Pirate Bay… North Korea, South Korea, Marilyn Monroe. Piracy was rampant, reports calculated that 20% of Europeans were using P2P to obtain music, 70% of young people didn’t think that there was anything wrong with downloading files. All of this was having an effect on sales, as music ownership had peaked in 2001 with the height of the CD boom, these figures plummeted as piracy became widespread.
So the copyright industries went on the offensive, and this is also one of the most active legal periods of the Copyright Wars. After Napster we had landmark cases in the US with Aimster and Grokster. In Australia Kazaa was also found liable for authorising copyright infringement. Not content with suing the P2P companies, the RIAA started suing members of the public, including a 12-year-old, grannies, and even deceased grandmothers (tempted to repeat the joke “I sue dead people”). As piracy had gained acceptance in some sectors of the public, the film industry unleashed the now infamous “You wouldn’t steal a car” campaign.
Other lawsuits targetted torrent providers, particularly the famous criminal case in Sweden against the operators of the Pirate Bay, and in the UK the case against Newzbin.
The efficacy of all of the legal action has been hotly debated since. Maximalists claimed the removal of several websites as a sure sign of victory, while minimalists point out that piracy never stopped, and one can still access sites like The Pirate Bay. Some have argued that the music industry in particular took the wrong strategy in fighting piracy, and that placing all of their efforts in fighting sites like Napster resulted in a delay in adopting digital music downloads. By the time iTunes became prevalent, a vital few years had been lost, and digital sales never were able to replace the CD music market. The result of this stage of the Copyright War can probably still be felt today.
Intermediaries again
A result of the P2P wars was a return to the emphasis on intermediaries. The short-lived attempt to sue members of the public was mostly a desperate act, as I keep repeating here, it’s a bad idea to sue your fans. So copyright owners started looking at other ways to try to curb piracy, and so the Copyright Wars went back to struggles between intermediaries and copyright holders.
This is a stage of the War at which the balance of power had shifted considerably, tech intermediaries had been accumulating both wealth and political power while the content industries had seen diminishing sales due to the Internet. The struggles tended to be more evenly contested, and resulted in some gains for both camps.
In Europe we saw quite a few cases from copyright collecting societies against ISPs attempting to get them to filter pirated content, or to give out information about users who were filesharing, one assumes to try to sue them directly. The results were mostly negative, such as in the cases of SABAM v Scarlet and SABAM v Netlog, where the Belgian collecting society wanted to impose the installation of content filters, and the CJEU found in both instances that such actions could violate other fundamental rights. A similar result was found in Promusicae v Telefonica, in which a copyright society tried to get a Spanish ISP to disclose personal information about its customers that were sharing files with Kazaa.
Surprisingly, there is relatively less legal action against intermediaries at this time in the US, probably because of the safety awarded by the DMCA safe harbor provisions. The biggest target was evidently Google, and the case of Viacom v Youtube set the stage for the next years. Viacom claimed that YouTube had allowed users to upload and stream its copyrighted content, including TV shows like South Park and The Daily Show, without permission. Viacom sought $1 billion in damages. YouTube argued it was protected by the DMCA, which shielded them from liability as long as they responded to takedown requests. YouTube had most of the early victories, and after years of litigation, the case was ultimately settled in 2014 with no public disclosure of the terms. The use of technical tools such as Content ID also helped to reduce legal action against YouTube.
In the UK, copyright owners were successful in forcing ISPs to impose blocks on certain websites after the landmark case Newzbin 2, in which the judge imposed an injunction against ISPs to have them block a website engaged in copyright infringement. Subsequent lawsuits extended the list to many torrent sites such as The PirateBay, KickAss Torrents, Fenopy, and EZTV. This was possibly one of the most successful maximalist victories of this era.
Streaming and the value gap
One of the most interesting developments after all of the legal conflicts above is that what reduced piracy was mostly the rise of affordable legal alternatives in the shape of streaming. Copyright didn’t kill piracy, Netflix and Spotify did.
However, the popularity of streaming services came with other issues for copyright holders, particularly the fact that the money that went to performers, musicians, actors, writers and other creatives decreased. Streaming offers legal options for users to purchase bulk content, and most of the earnings from the reduced income tends to go to a small number of successful creators, while the vast majority cannot make enough money.
This is often referred to as the value gap. This refers to the growing disparity between the significant value generated by creative content on online platforms and the comparatively small portion of revenue returned to the creators and rights holders of that content. This issue is especially pronounced with platforms that host user-generated content, like YouTube, which allow vast amounts of copyrighted material to be shared and monetised through ads or other revenue streams. Maximalists argue that while these platforms profit substantially from creative works, the original creators receive disproportionately low compensation. A key factor contributing to the value gap is the difference in how platforms handle licensing and royalties. Services like Spotify and Apple Music, for example, negotiate licensing agreements and pay royalties to artists for using their content, but user-generated content platforms often operate under different rules.
The value gap is still an important element of the ongoing Copyright Wars, with regulations such as Art 17 of the DSM Directive being enacted to tackle it. It is not clear if this has been managed, while the DSM came into force in 2019, its implementation in this regard has been relatively slow. Critics of Art 17 point out that it increases the cost of conducting business online, and at least from my limited perspective I have not seen many positive effects in reducing the value gap, at least at the time of writing.
Another important battleground in the Copyright Wars has been the so-called “link tax”. This was first passed in Spain in 2015, and this is a new related right that allows publishers to charge content aggregators such as search engines and social media for links to their content. The results of the experiment appear to have been mixed, but studies concluded that it led to market fragmentation, but did not affect news consumption. There was a link tax also in Article 15 of the DSM Directive, which has also proved to be controversial, and one of the latest stages of the Copyright War. Canada has also been involved in a similar conflict.
The AI Wars
All of this brings us to the current stage of the Copyright Wars: the AI Wars. I won’t discuss that here, please refer to my previously published works for ongoing coverage of the latest battles.
Concluding
The above is just a general introduction to the Copyright War, and it covers mostly the online conflicts. I left out a considerable amount of stuff, such as graduated response (three strikes), the Marrakesh Treaty, the rich case law on communication to the public, Internet jurisdiction, parody, software, APIs, temporary copies, libraries, orphan works, and many other hot topics.
One thing is certain, the Copyright War will continue unabated. After all, we didn’t start the fire, it was always burning, since the world’s been turning.
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