In the immortal words of former MPAA President, Jack Valenti (testifying in front of Congress in 1982);
"I say to you that the VCR is to the American film producer and the American public as the Boston Strangler is to the woman home alone."
I sometimes feel like the MPAA and the RIAA are so pigheaded that they should win this case and see their constituencies’ geriatric empires humbled in the face of less-restricted global competitors.
I’ve sat through innumerable indecency conversations waiting for the real game to begin, the only event that has a real chance of negatively effecting the First Amendment and/or our freedom to innovate (shouldn’t this be a Constitutional Amendment or at least legislation of some sort, the “Freedom to Invent New Stuff Without Getting Sued Into Oblivion by Guys Trying to Protect their Crusty Business Models Act of 2005,” call it the FINSWGSIOGTPCBA of 2005.) Anyway, the Grokster case has real teeth and real implications for the future of media, and more specifically, the democracy in media movement.
(Aside: I’m going to assume that anyone reading this understands the basic premise of the case, with the exception of highlighting one item, which to me is the crux of the issue. In the 1984 Betamax decision, the Supreme Court ruled that products are not liable for contributory infringement even if said product was “merely capable of substantial noninfringing uses.” A lot of attention is paid to the idea that it is the ratio of infringing vs. non-infringing content that is relevant. But to me, it appers that the ruling indicates that future capability is the real question. This was echoed by Justice Scalia who felt that maybe these technologies should be given a decade to mature before the ratio was analysed. Anyway, MGM isn't that patient. They are arguing, in effect, that since the ratio of infringing to non-infringing is so bad (estimated at over 90% infringing, probably not far off) these technologies should be severely restricted (read controlled by Hollywood) so that these billions of dollars of lost revenue can be captured.
It would seem to me that the 1984 argument was no different than the 2005 argument; the VHS was threatening to kill people for chrissake! The point is that it would appear on the surface that the MPAA is insane to believe that the Supreme Court would rule differently in this case. Even if the justices find the business models of StreamCast and Grokster distasteful, they appear to understand that curtailing such activity would have serious negative implications for the pace of innovation. And it would appear that the overwhelmingly positive result of the prior Betamax ruling FOR the plaintiffs should significantly flavor their decision AGAINST the plaintiff in this case.)
Anyway, the point is that this has substantial implications for the democracy in media movement. For if the Supreme Court rules against Grokster, one of the primary enablers of the democratic media movement, access to inexpensive independent distribution, will largely evaporate. P2P distribution mechanisms, such as BitTorrent, are critical in the empowerment of consumers to distribute large media files cost-effectively and directly to their customers. With a negative ruling, innovation in the P2P space will stagnate, at minimum. Anyone developing software that takes advantage of P2P mechanisms to simplify distribution of assets for micro-audiences, will be forced to move to a command-and-control infrastructure to manage this delivery. These “old-world” distribution mechanisms are many orders of magnitude less efficient and more expensive than P2P. In other words, blogs may be fine (low-bandwidth), but audio and video communications would be crippled until the cost of bandwidth and storage dropped sufficiently to alter the cost-efficiency equation (which would still take many years at today’s rates of deflation).
Mark Cuban is right; control of distribution would remain even more firmly in the hands of the same monolithic media empires that are largely responsive for pursuing this case and creating the environment in which the incentive to abuse such technologies is so enormous. If the MPAA is successful, litigation would hang like a cloud over entrepreneurial efforts, driving up the costs of launching new products and effectively severing their access to capital. The fact is these companies have no incentive to change their business models to further empower consumers to participate in the production and distribution of content. They like their existing business models in which they decide what is produced and how it’s delivered. This business, however doomed, is still very profitable.
But freedom to build an efficient decentralized distribution network is critical to the success of democratic media. Without it, the “long tail” of content (at least video and audio content) will never be fully expressed. I just hope the justices see this case for what it is, a sacrifice of innovation at the alter of yesterday’s decrepit business models.