Entering the Era of Internet Accountability: The Implications for Copyright – Hugh Stephens

7 11 2018

I recently had the honour to be invited to give a guest lecture to the Copyright Society of Australia in Sydney. My talk focussed on how the Internet has evolved over the past twenty years, leading to a severe imbalance between Internet platforms and the creative community because of the abuse and misuse of safe harbours, and how recent events have put the big platforms in the spotlight—indeed in the crosshairs of the public and politicians.

Because of the unwillingness to date of the big platforms to accept real responsibility, the new era of Internet accountability that we are entering is going to be difficult for them. If the platforms cannot embrace reform and start to accept responsibility for their business models and behaviour, then governments and politicians will do it for them by changing the policy settings and rules. There will then be a risk that the pendulum could swing too far in the other direction. The big Internet intermediaries and the content community have shared interests. Distribution needs content; content needs distribution. But for this partnership to work, there has to be a recognition on the part of the platforms that fighting rights-holders and creators tooth and nail, in a form of trench warfare, is counter-productive. This is the right time to forge a new partnership between Internet platforms and the creative industries. However it will require the intermediaries to grasp the opportunity and start to be part of the solution instead of part of the problem when it comes to digital piracy and de facto free riding on the content of others.

Here is the full text of the talk;

Introduction

Good evening. I would like to extend my thanks to the organizers, the Copyright Society of Australia and the Australian Screen Association, for inviting me to share some thoughts with you this evening on what I call the new era of Internet accountability and what this new era can mean for both the tech and copyright industries.

By Internet accountability, I mean platform responsibility; taking appropriate responsibility for the content that Internet intermediaries enable or facilitate—and, in many cases, consciously make available. Content that they, in effect, publish by making conscious choices as to what to allow and in particular, what constraints to ignore.

This moment provides new opportunities for dialogue and partnership between the technology world and world of content creativity. Let’s not miss this moment.

The situation is, of course, still fluid and evolving. We have not yet achieved the level of cooperation necessary to strengthen the entire Internet ecosystem. This moment could pass if the tech community cannot find common ground and work cooperatively with rights-holders, in the process restoring a balance that has gone askew as the digital revolution has taken hold. It has been a long time in coming–more than 20 years.

For too long policy-makers have been “missing in action” when it comes to effectively regulating the Internet. Under pressure from the tech community, and supported by advocates in civil society,–every group from extreme cyber-libertarians to so-called “progressives” concerned with combating what they see as authoritarian attempts to “censor” the internet—governments have suspended judgement and in effect abdicated their responsibilities.

Only slowly, like the frog being boiled in water, has society woken up to the potential for abuse, come to the realization that creative industries such as print media are being hollowed out, and watched as free-riding on the back of the creative community has become a blood-sport. In the process, huge oligopolies –virtual monopolies–have grown in many sectors of the Internet, such as search and social media. It is encouraging that policy makers are now starting to take note, as exemplified by reforms to the Copyright Directive in the EU and the current Digital Platforms Inquiry in this country being conducted by the ACCC.

It is clear the public mood is changing. Public apologies to legislators, commitments to “do better” and “fix the problems” coming from the platforms are but the tip of the iceberg. Politicians and courts are now taking a much closer look at the previous assumption that if the Internet is to thrive and grow, if we are to be able to reap the full benefits of digital innovation, we must not do anything that might be construed as nipping the Internet in the bud. In fact, the risk is that if the platforms and intermediaries don’t start making changes voluntarily, policy makers will do it for them, with the attendant risk that the pendulum of regulation could swing too hard the other way.

The Digital Garden

I think of the Internet as a garden and, as with any garden, for it to thrive there must be a balanced ecosystem. That ecosystem requires flourishing platforms but also a flourishing creative sector—two species that can live in harmony and support each other. But there are also weeds in the garden (pirates/content theft businesses), parasites that feed off the creative sector but who have managed to survive by sheltering in the shadow of the platforms.

The policy makers—the gardeners in this analogy–seem to have decided to favour the platforms by applying lots and lots of fertiliser (absence of meaningful regulation), which has allowed the favoured plants—the platforms–to grow, and grow, and grow. The other desirable and necessary species in the garden—the creative sector—is being crowded out and starved by the exponential growth of the platforms, and by the parasites (piracy) that depend on them. In fact, the platforms and the parasitical content pirates have learned to live with each other quite well, and have established a sort of symbiotic relationship. And as they have done so, they are squeezing the life from other life forms in the garden–like the creative industries–that are necessary for a healthy ecosystem.

This was not what was intended at the dawn of the Internet era, by its founders. The answer is for policy makers is to get back into the garden, start pruning and weeding, and bring things back into equilibrium.

The time to restore a healty ecosystem has arrived. We need to restore the modus vivendi that existed before the digital era, when it was accepted that ownership of intellectual property conferred certain rights that had to be respected. You couldn’t copy willy-nilly; you couldn’t monetize and free ride on someone else’s content without permission, and normally some form of compensation, and you couldn’t absolve yourself of all responsibility because you were a publishing platform. You had to verify whether the content you were publishing—in printed or audio visual form—was legitimate and non-infringing. We need to restore that balance to the digital environment. We need to get copyright “right”.

Remember When?

Do you remember the early promise of the Internet? How it would democratize not only society but creativity and business opportunity, giving everyone the possibility to be an entrepreneur? How it would liberate and educate, a borderless repository of knowledge that would reshape our economies and our societies? And to achieve this nirvana, we had to tread carefully so as not to stifle the groundswell of innovation that was making this possible. Regulate with a light hand, or better still, don’t regulate at all because the Internet will self-regulate.

As the famous (or perhaps infamous) “Declaration of Cyber Independence” in 1996 by John Perry Barlow stated, “Where there are real conflicts, where there are wrongs, we will identify them and address them by our means.” The reality is far different. Not only have they not been addressed “by our means”, they have not been addressed at all.

Those early days were before Google (founded September 1998), Facebook (first website, February 2004), Youtube (a year later, in February 2005) or Twitter (March 2006) came on the scene. Many of the early Internet pioneers—MySpace, AOL, AltaVista, and others, have gone the way of the dodo, forced out of the garden by competition for space , while those “new arrivals” have just grown, and grown, and grown…..

All this was before Cambridge Analytica used personal data from Facebook to run digital campaigns that helped manipulate the US Presidential election as well as the Brexit campaign. It was before a so-called non-profit from my home town, Open Media in Vancouver, used spam techniques and email swarms (astroturfing as its now called) to influence MEPs voting on changes to the EU’s Copyright Directive or to flood Canada’s copyright review process with a spurious “grassroots campaign”. It was before Google (whose motto of “Don’t be Evil” has morphed into “Do the Right Thing”) was fined $2.7 billion by EU regulators for abusive practices over online shopping, to be topped only by the $5 billion fine for anti-competitive behaviour regarding its Android platform.

Of course Google can well afford to pay these astronomical fines not only because it is highly profitable but because, in many jurisdictions where it operates—including Australia–it pays only minimal tax.

Back then was when media companies—good old fashioned newspapers that gathered and curated news–began the long descent into digital purgatory. The shift from monetizing their own content to having their content monetized by news aggregators had begun. Digital online piracy began to emerge, changing forever the music and audio-visual industries.

Enter Napster, Pirate Bay and other websites for downloaders, while the euphemism of “file sharing” became a buzz-word. And as music revenues plummeted and piracy grew, a few monopoly platforms became the sharks and swallowed all the small fry, in the process making the monetization ofcontent owned and produced by others (the uncharitable would say “free riding”) a core business model. As Jonathan Taplin, author of Move Fast and Break Things (Mark Zuckerburg’s famous quote) has observed;

The tech elite’s jealous guarding of its own monopoly platforms is built upon the blatant disregard for the artist’s intellectual property…” (p. 103)

“Better to ask for forgiveness afterwards than permission beforehand”, became the mantra. The concept of “permissionless innovation” was hatched, where “disruptive technologies” were expected and encouraged.

And in this world of disruptive change, content protection was wrongly portrayed by many in the tech community as an obstacle to innovation.

This is one of the arguments advanced in Australia for the introduction of a broad “fair use” principle, with fair use advocates arguing that without it, innovation will be held back. Yet copyright does not stand in the way of innovation; in fact it enables it.

As Professor George Barker has pointed out in his study on fair use in Australia and New Zealand, copyright does not prevent use. It only requires consent or agreement prior to use. That consent normally requires a setting of value on the content, providing a market determination for its allocation, rather than becoming mired in endless litigation.

The World Has Changed

Yes, all of this has happened over the past couple of decades, and the world has changed. There is no going back, and I am not suggesting a return to old business models. In fact the creative community and content industries have adapted remarkably well, harnessing rather than resisting technological change. It has been challenging, because of the “carte blanche” given to internet platforms, which has led to consumers expecting something for nothing, encouraged by the growing presence and sophistication of pirate operators.

While there are many factors in the growth of piracy, among the most important is the role of the Internet platforms, who have benefited mightily from the loose rules. Although not done deliberately, it is the platforms that have enabled piracy to develop on an unprecedented scale , and then they have monetized the unauthorized use of content (alongside legitimate uses to be sure) in building dominant and successful businesses.

I would call this the world of internet irresponsibility; a laissez-faire, deliberately-blind approach to the interests of others in the Internet ecosystem. It goes beyond misuse of intellectual property of course, to issues of privacy, consumer consent, anti-competitive practices and social responsibility.

Self-regulation has not worked so well. Now we know what policy-makers didn’t know two decades ago, and we can see what can happen when the balance of appropriate regulation and business leverage is lost.

In this context, it is worth looking at comments Senator Mitch Fifield, Minister for Communications and the Arts, made earlier this month to the Sydney Institute in his address “The Internet–not an ungoverned place”. The Minister laid out a number of concerns and actions in that speech but I thought the following remarks were particularly apposite;

“Digital platforms and online content providers are increasingly realising they have a duty of care in the communities and markets that are brought together by their services.

I see this as coming to terms with the reality of their social licence – in much the same way that traditional media services recognised and accepted their social licence to the community in the 19th and 20th centuries.

This is welcome. As a Government, we expect industry to take the first step in responding to community standards for appropriate behaviours online. But it remains to be seen whether their actions alone will be enough….where platforms fail to act to reduce harm, we won’t hesitate to do so.”

Entering An Era of Platform Accountability

It is clear that the free-ride is over and that the era of Internet irresponsibility is coming to an end. The flip side is that the era of Internet platform accountability is, I think, finally arriving. And it’s long overdue.

Canada’s Minister of Heritage (until recently), Mme. Melanie Joly, put it well when she said;

I think more and more voices around the world are being raised regarding the fact that platforms need to recognize their responsibility, and that while they’re getting a huge piece of the pie of digital advertising revenues, there needs to be an approach to support more trusted local journalism…..The benefits of the digital economy have not been shared equally. Too many creators, journalists, artists have been left behind, and there needs to be a better balance.”

Not only do the platforms get most of the upside in the form of advertising dollars when they distribute legitimate content, such as news sites, but they also cash in on illegitimate content. A recent Canadian study showed that newspaper and TV websites generated just $433 million of the $4.6 billion that was earned through digital sales of that content in Canada in 2015—less than 10% of revenues to the producers of the content!

When the platforms monetize content that is legal, they argue that they are doing the content creators a service because they are making the site’s content more accessible. When they monetize content that is infringing or illegal, they argue that they cannot be held responsible for what others put up on the Internet.

But change is coming. In the US, the shield of choice, Section 230 of the Communications Decency Act, 1996, an overly-broad immunity that was instituted in the very early days of the Internet, has recently been modified to remove absolute platform immunity, and hold responsible those who profit from promoting child prostitution and sex trafficking. So-called “neutral platforms” (like Backpage that carried ads promoting sex trafficking) are no longer shielded from immunity.

The tech community lobbied long and hard to defeat this amendment, arguing that it would undermine the Internet. This “slippery slope” argument did not convince US lawmakers and amendments to Section 230 became law in April of this year. This is a clear statement that a “see no evil” approach is no longer acceptable. The whole concept of what a safe harbour should be, and who gets into the harbour, needs to be revisited. And, as you know, the issue is playing out here right now in Australia.

USMCA

There are other forums where the issue of safe harbours ia also being played out.

The recently concluded update to NAFTA (the so-called USMCA) was a vehicle for the platforms to try to include Section 230 language that would limit the ability of the Parties to the Agreement to hold Internet platforms responsible for content appearing on their services. Under Article 19.17.2 in the Digital chapter of the USMCA, the parties are constrained from taking future actions that would treat passive platforms as publishers, or content providers. However the language in the Agreement does not require the establishment of safe harbours for platforms (where they do not already exist). Therefore from a Canadian perspective, there should be no requirement to change Canadian law.

In my view, while I would rather not have seen this language included in the USMCA, it needs to be kept in context. Certainly, it runs counter to trends in Europe where platforms are being held more not less accountable for the content on their platforms. That said, it is an overstatement to make a sweeping claim, as some have done, that Internet companies are not responsible for the content of their users as a result of the USMCA language. Canada, the US and Mexico most certainly did not give up their ability to legislate to hold platforms accountable and responsible for the way in which they operate, despite an attempt to limit the authority of regulators and legislators by trying to lock safe harbour language into this trade agreement.

EU Copyright Directive

In Europe, another area where the platform responsibility issue is under review, needed change is coming through the adoption of revisions to the Copyright Directive, including Articles 11 and 13. These revisions were passed on a second attempt by Members of the European Parliament in September after the initial vote was hijacked by a well-organized spam and astroturfing campaign mounted by copyright opponents, facilitated, among others, by the Canadian “non-profit” group Open Media. (of which Google is a platinum funder).

Among the so-called “controversial” amendments, Article 11 will grant publishers direct copyright over “online use of their press publications by information society service providers”, (while providing exceptions for hyperlinking and individual non-commercial use), a move which should strengthen their hand in negotiating licences with news aggregators and media monitoring services.

Article 13 will require for-profit online content sharing service providers (or internet intermediaries) to take “effective and proportionate measures” to prevent the availability on their platforms of unlicenced works identified by rights-holders. They must also act “expeditiously” to remove them, and demonstrate that best efforts have been made to prevent future availability. This should incentivize platforms to seek out licences on a commercial basis rather than relying on immunity shields.

Article 13’s provisions provide a number of exemptions (non-profits such as Wikipedia, smaller platforms, educational and scientific repositories etc.), but targets commercial web hosts which “store and give the public access to a large amount of works or other subject-matter uploaded by its users which [they] organise and promote for profit-making purposes”. The key terms are “give the public access”, “large amounts of works”, “uploaded by users”, and “organize and promote for profit”. Does that remind you of anyone? (Youtube perhaps?) It is not surprising these provisions have been vigorously opposed by the tech and platform community.

If enacted—and there is still some way to go–these provisions will help significantly in restoring some balance to the content-monetization equation, and will neither impede free speech nor “break the Internet”. They won’t censor the Internet, nor undermine Wikipedia, nor prevent individuals from using links, or prevent parody and memes, despite all the overblown rhetoric from opponents. What they will do is introduce greater platform responsibility at a time when it is badly needed.

Platform Response

As I mentioned, the platforms fought hard against this outcome and they haven’t given up. They continue to fight, in Canada, in Australia, in New Zealand, in Europe. They tried to get absolute platform immunity baked into the new NAFTA’s digital chapter and thus short-circuit the amendments that were eventually approved by the US Congress (known as FOSTA-the Fighting Online Sex Trafficking Act). In Australia, there are attempts to introduce a “technical and incidental” exception that would grant a blanket immunity to search engines, subject to fairness factors which in effect amounts to fair use via the backdoor.

While it is not my intention here to become immersed in the Australian debate, I must ask the question as to whether this is not a solution in search of a problem. Has current law impeded innovation or imperilled the functions of search engines or other internet intermediaries in Australia? Not to my knowledge. I would urge Australian policy-makers to think carefully and not to try to fix that which is not broken.

Google v Equustek: Legal Accountability

This emerging trend of platform accountability is being reflected not just in Europe and here in Australia, but also in other jurisdictions. The recent Google/Equustek case in Canada was an important decision by the Supreme Court of Canada holding Google accountable under Canadian law.

Briefly, the case involved Google’s responsibility to comply with an injunction issued by a national court despite its “international presence”. Google (admittedly a third party) became caught up in a dispute between two Canadian companies over Company A’s theft of the intellectual property of Company B (Equustek).

Equustek won a court injunction in British Columbia requiring Company A to desist from its practices. Company A then set up outside Canada and continued to do business online, in open violation of the injunction. Equustek then petitioned for the delisting of search results for Company A as a means of enforcing the injunction. Google agreed to delist the offender from its Google.ca results but not from its global search results. Since Canadian consumers can easily access other Google search platforms, such as Google.com, Google’s partial delisting had little practical effect.

Equustek went back to Court to require Google to implement the BC court order globally, and won. Google admitted that it could delist the Company but refused to do so on the basis that the ruling had extra-territorial reach and would “chill the internet”. What would happen, Google argued, if another jurisdiction required it to delist sites promoting gay lifestyles, for example. This was framed as a “freedom of speech on the Internet” issue. Google appealed first to the BC Court of Appeal and having lost there, to the Supreme Court of Canada, where it lost again. The Supreme Court ruled that theft of intellectual property could hardly be considered a free speech issue, but noted that if the Canadian order required Google to break the law in another country, the US for example, it could apply for relief from the injunction.

Google immediately brought an undefended case in California asking the US court to rule that the Canadian order had no applicability in the US, which determination was granted. Interestingly, Equustek had not asked for the order to be enforced in the US, and did not appear. Armed with the California court ruling, Google returned to the BC Court asking that the original injunction requiring blockage of all Google searches be suspended. The Court refused, rightly in my view, pointing out that delisting the company required Google to break no laws in the US. In fact Google is free to list or delist whoever it likes unless there is a court order requiring a listing, which of course was not the case.

At the present time, Google is complying with the Canadian Supreme Court order in order not to be found in contempt. Nevertheless, it has fought tooth and nail against this decision. I use this example to illustrate the determination of the platforms to resist any and all attempts to hold them accountable under national law. Google’s position is, in effect, that it is above the law of any particular jurisdiction (except perhaps California) because it operates in multiple jurisdictions.

This, of course, is nonsense, but it is the position that Google recently took in New Zealand over a court order to suppress details and remove content related to a local murder trial (because it would affect the right of the accused to a fair trial). Its local counsel declared that Google would not comply with a New Zealand court order because, according to the New Zealand Herald, “Google LLC, was a separate legal entity incorporated in the US, meaning New Zealand’s courts and laws held no power over it.” As far as I know they got away with it.

The outcome of the Equustek case, however, is an important blow struck for the rule of law and for common sense, and is an example of how the tide is changing. The difference between right and wrong does not change when things go digital.

“We’ll Do Better”

One of the responses that we are seeing from the platforms is a new sense of vulnerability. “We will do better” is the refrain. But the proof of the pudding is in the eating and if platforms are really going to reform, they should start behaving like they mean it. One concrete way to “walk the talk” is to stop facilitating content theft and instead reach out and work with rights-holders to create an environment where the Internet is built and based on legitimate content, an Internet where the rewards are shared equitably with creators, rather than pursuing a policy of wilful blindness to widespread infringing activity while reaping monetary benefits from content known to be pirated.

A good first step would be to stop fighting every measure brought by creators to stop the infringement of copyright and to enforce their rights. In short, what is needed from the platforms is active participation in becoming part of the solution rather than being part of the problem.

What Could the Platforms Do?

Charlie Rivkin, Chairman and CEO of the Motion Picture Association of America in his speech to the Tech Policy Insitute’s Aspen Forum this past summer talked about the broken window syndrome. Broken windows are a metaphor for petty crime that is ignored, this sending the subliminal message that the law can be broken with impunity, leading to more widespread and larger scale criminality. Rivkin called for a collaborative effort to turn the tide in the right direction. The tech community, the internet intermediaries and the content creators need to come together and work together and fix the broken windows. This is not a zero-sum game. It will benefit everyone.

In building this community of effort, what are some reasonable goals for cooperation? How do we get copyright “right”?

Some examples could be greater revenue sharing with artists by YouTube and others and more active efforts to curtail the use of this and similar platforms to distribute infringing material. Another could be greater willingness to provide compensation to content producers, such as news media organizations; to license material from them rather than just aggregating the content through links. (The proposed revisions in Europe should go some way toward resolving this dilemma). The open indexing of pirate websites on search engines is another issue that needs to be resolved.

Beyond copyright there are of course a number of steps that can be taken to enhance privacy and protect the personal information of consumers. Revisions to terms of service to make it clear what a consumer is giving up when he or she clicks “I agree” are needed. Fuller cooperation with national authorities to block offshore websites streaming pirated content would be helpful., While ISPs do the immediate blocking, intermediaries could cooperate instead of fighting these proposals. Search engines, for example, play a critical role in guiding users to pirate sites.

(It looks as if Australia will be moving soon to address this problem with the announced new amendments to the Copyright Act).

The platforms could stop promoting their cyber-libertarian view of the world, and start finding grounds for cooperation with the creative community and rights-holders. It will take a shift in mind-set but with a renewed scrutiny on the platforms as a result of the abuses that have taken place—not just in the area of copyright but including it—the platforms need to respond and rebuild credibility. The content industry can be important allies if, instead of fighting them every inch of the way, the big internet intermediaries embraced them as partners. Instead of being resources to be exploited through “liberal” interpretations of what is fair use, the creative community could be partners in growing responsible digital platforms.

The platforms are facing increased pushback from the courts, lawmakers and the public, and there is a risk of over-reaction. A partnership with the content industries, a working relationship rather than an adversarial standoff, will help mitigate this risk.

And policy makers have an importat role to play by continuing to push the platforms in order to incentivize them to open a meaningful dialogue with the content community.

What Should the Copyright Community Do?

Rightsholders need to remain vigilant that existing protections are not further eroded. Moving beyond that, there is a need to push for fairer compensation for the use of copyrighted content, whether it is closing the value gap in music, ensuring that writers are fairly compensated, or finding ways to help news content producers to monetize their own content. Finally rights-holders need to work with the the platforms to convince them that it is a short term and in the end self-defeating strategy to profit off the listing, hosting or providing access to pirated content. The Internet is an ecosystem of creation, distribution, and consumption. Break the cycle and you break the virtuous circle.

Conclusion

The public mood is changing and patience is running thin. The abuses of the Internet intermediaries that have been widely publicized– the invasions of privacy and misuse of personal data, the manipulation of news content, the knowing tolerance and even facilitation of piracy— have provided an opening and opportunity to redress the balance. They also offer an unparalled opportunity to build a lasting digital structure through cooperation between copyright industries and tech intermediaries. Let’s use this opening to bring about an atmosphere of greater respect for copyright and content. The era of internet accountability is here and the period of regulatory capture is over. Lawmakers are ready to move.

Let’s find ways to restore the balance between content and distribution that has gone so badly astray over the past 20 years, in partnership with the tech community. And lets see the tech community grasp this opening and step up its efforts to work with rightsholders instead of fighting them.

We could all come out of this in a better place.

Thank you.

© Hugh Stephens 2018. All Rights Reserved

This post originally appeared on the Hugh Stephens Blog and is reproduced with permission and thanks


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7 11 2018
‘Entering the Era of Internet Accountability: The Implications for Copyright’ | Private Law Theory - Obligations, property, legal theory

[…] “I recently had the honour to be invited to give a guest lecture to the Copyright Society of Australia in Sydney. My talk focused on how the Internet has evolved over the past twenty years, leading to a severe imbalance between Internet platforms and the creative community because of the abuse and misuse of safe harbours, and how recent events have put the big platforms in the spotlight – indeed in the crosshairs of the public and politicians …” (more) […]

12 11 2018
Law and Media Round Up – 12 November 2018 | Inforrm's Blog

[…] an INFORRM post Hugh Stephens considers the implications for copyright law due to legislating for internet […]

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