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March 01, 2006

Aligning incentives with responsibility for peer-to-peer filtering

In its recent Grokster decision, the U.S. Supreme Court said that P2P technologies were not required to implement filtering for copyrighted content, but that failure to install filtering would be considered as one factor in assessing whether the software actively induces infringement (which is illegal).

Pam Samuelson wrote a column in Comm. ACM (access restricted; available to UM readers) in which she points out the many costs and infeasbilities of imposing a filtering duty on software creators (she argues that the blurry line is sufficiently problematic that filtering may become a de facto duty).

Some of the problems she identifies include keeping up with filename modifications, and fingerprint and watermark hash avoidance schemes. Generically, the problems include


  • figuring out what to filter,

  • keeping the filters up-to-date, and

  • extending the filters to multiple forms of copyrighted works (not just, e.g., songs).

Without endorsing the Supreme Court decision or Pam's fear that this decision will ultimate mean filtering is a de facto requirement for P2P file-sharing software, let's think about how incentives might help solve the filtering problems she identifies.

While I was reading, I thought the problems might not be so difficult...if copyright owners bore some of the responsibility for implementing them. Copyright holders have the incentive to limit distribution of content; file-sharing software providers, if anything, have an incentive to maximize the distribution of content. If as a matter of policy, we want to maintain some limits on the distribution of copyrighted content, then it is incentive-compatible to put the copyright holders to work on implementing protection technologies. The alternative is to construct articial incentives (such as jail time) to shift that burden onto file-sharing software providers: why not use the natural incentives already in place?

For example, rather than requiring the P2P software publishers to collect a database of fingerprints, and to keep up with changes, they could implement a simple API that allows copyright owners to contribute the fingerprints of content they own. (A contributor could be required to register and provide a verifiable digital signature to help ensure that they were legitimate copyright holders.) That would largely deal with the problem of "what to filter", and would be consistent with earlier requirements that copyright holders register their copyrights.

Posted by jmm at March 1, 2006 11:06 PM

Comments

Two comments.

First of all, many of the p2p community that I have talked to fear giving the copyright holders the ability to block content. It is not clear at all if copyright holders are actually acting rationally -- often such sharing can increase profits which then a rational actor should encourage, but they don't. I think we'd need more evidence of actions in accordance with rational actor theory before we try to impose this type of solution.

Secondly, the copyright holders will likely oppose this on the grounds that they don't even know what copyrights they own. When Jessica Litman spoke at STIET a few years back she mentioned that in her opinion the biggest problem with copyright was that the large copyright holders (MPAA, RIAA) don't actually know what copyrights they hold. Due to many mergers and acquisitions and poor filing, the actual documents that can establish copyright holdings are rare. They have them for the big, important pieces of copyright (think Mickey Mouse), but they could never come up with a comprehensive list of what they hold copyright to. This leads me to think that the copyright holder's incentives are insufficient in this situation.

Posted by: rwash at March 2, 2006 12:31 PM

Rick, thanks for your comments (first on the blog!).

I certainly agree that before shifting some of the responsibility to the copyright owners, there needs to be careful thought about what harm they might cause (rationally for them, or not). What I'm thinking, though, is that if the courts decide the file-sharing software providers (FSSP? yecch) are required to provide content filtering, this might be a way to reduce the costs and make it sufficiently efficient that they won't be driven out of business altogether.

Your second point I think the response is even more clear: what's the alternative. If filtering is mandated, the FSSPs are going to have a much harder time than the copyright holders figuring out who owns what! I actually think of this as one of the big advantages of the idea: if the burden is on the FSPPs and they don't figure out who owns something (if anyone), they may be found liable nonetheless if the owner shows up later (ignorance of property owner's identity is rarely a defense, I think). If the burden is on the copyright holder to post the claim to a public database, then the owner can't turn around and sue an FSSP for not figuring it out.

I think perhaps your argument (and Litman's) primarily addresses the question of whether filtering should be required at all, but I'm setting that to the side for the moment, trying to discuss how to design an incentive-compatible filtering system if the courts (or Congress) do require it.

Posted by: jmm at March 2, 2006 02:04 PM

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