A Model for Innovation Protection: Section 1201

Published September 17, 2014

Today the House Judiciary Committee is undertaking the next in its series of hearings discussing the Copyright Act. This time the hearing will focus on Title 17, Chapter 12 which discusses copyright protection and management systems, including section 1201 regarding the circumvention of copyright protection systems. The very design of the Chapter was to promote creation and innovation, imbuing the Digital Millennium Copyright Act with flexibility.

By including section 1201, that is, by allowing for secure methods of distribution, artists have been provided some protection against theft of their property. This has resulted in a flood of content for multiple new and traditional platforms that otherwise would have been at high risk of theft. Just as society disallows breaking and entering, or the possession or sale of lock picking tools (except in very narrow circumstances) the section prohibits the circumvention of technological protection measures and disallows the trafficking in tools that are primarily designed for circumvention.

The provision was not without controversy when included in the legislation and remains controversial today. But the section has withstood the test of time. Consumers enjoy massive choice in delivery methods now. New and innovative licensing and distribution models for online content seem to emerge every day. Just in online music the variety of services via abundant business models is amazing including iTunes, Spotify, Pandora, satellite radio, AOL Radio, Slacker, Grooveshark, Jango, Last FM, Songza, Sony Music Unlimited, and many more. For video Ultraviolet, Disney Movies Anywhere, HBO Go, TV Everywhere, Epix HD, Hulu, and Crackle just begin the long list. Means of accessing books are many and highly competitive. Consider Amazon’s Lending Library, which allows Amazon Prime subscribers to borrow titles at no additional cost. This service uses digital rights management technology protected by section 1201. Entertainment software (video gaming) is available in more ways and more places than any boy playing on his Atari could have ever imagined

What does it all mean? It means that once property rights are protected a market will grow, and expand, innovating new products and services to meet the expectations and needs of consumers. The certainty and flexibility of section 1201 provides that property protection and legal certainty, providing a reasonable landscape for artists and creators to make more content available in more ways despite the increased risks of piracy inherent in a digital world.

Of course some have tried to use the law in ways it was never intended. This is not uncommon as lawyers seek to new and creative arguments to benefit their clients, yet the courts have rejected use of the section much beyond protecting copyrighted works which has preserved competition. Often cited as an abuse, is the assertion of section 1201 in an attempt to protect the garage door opener and third-party printer toner cartridge markets. Less often added is that the courts appropriately found that the use of 1201 to leverage sales, instead of merely protecting legitimate copyright interests, was inappropriate and those attempts failed. The system worked.

But no legislation is perfect, particularly as technology and times change. That understanding is an integral part of this law. Anticipating innovation in business models, technology and services the law requires the Library of Congress to update a list of exceptions every three years so that non-infringing uses of copyrighted works could continue even while appropriate safeguards were preserved for creators and distributors. Explicitly protected is free speech by including permanent exemptions, such as for libraries and educational institutions, encryption research, security testing, and reverse engineering.

In all, the law contemplated technological protection measures and made clear that they were allowable. The potential harms were also specifically contemplated with measures included to guarantee that non-infringing uses were allowed. The courts have similarly acted appropriately in constraining the reach of the law to little more than guaranteeing the protection of copy protected works. Erosion of section 1201 to allow the trafficking of tools primarily designed to enable digital theft seems silly on its face given that in the analog world such tools are per se illegal.

Ultimately, Section 1201 encourages self-help, that is, property owners benefit if they take action to protect their own property. This is entirely appropriate, ultimately conserving law enforcement resources for the most challenging issues. The law also encourages innovation by protecting the property of artists, inventors and creators. The result is that all consumers are able to enjoy content in ways not dreamed of even 15 years ago.