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This post illustrates that even countries with legal traditions very different from that of the United States can teach Americans something about values. In France, criminal investigations follow the “j’accuse” model, under the Code pénal, where a single judge — known as the Juge d’Instruction — controls investigation and charging of suspects, and under which a defendant’s silence can be held against him and the burden of proof is far less than the “beyond a reasonable doubt” standard required here. France has also taken a rather different approach to civil law on the Internet, for instance holding Yahoo! liable for anti-semitic postings by users.
But these differences also go in another direction. Several weeks ago the French Assembly passed a measure, known as the “three strikes” law, that required ISPs to terminate Internet access for users found to have downloaded copyrighted materials at least three times. That law has now been set aside as unconstitutional (yes, France actually has a constitution!) by the French courts.
The French Constitutional Council ruled Wednesday that the law’s reliance on the government committee to make decisions on when to cut off people’s Internet access made it incompatible with the French Constitution. Since the “Internet is an element of freedom of speech and the right to consume,” only a judge has the power to deprive someone of it, according to the decision.
As a result, the law will be enacted without the “third-strike” of cutting off Internet access. Instead the government agency only will be permitted to send out mail and email warnings to suspected pirates. If it wants to further sanction an alleged illegal downloader, it will have to go to court.
Sarkozy’s Web-Piracy Fight Dealt Blow [WSJ.com].
While the decision rests ultimately on what we in the U.S. would term separation-of-powers, namely the relationship among different branches of government, it also introduces a concept completely alien to the American legal system. Although the Declaration of Independence starts with several self-evident truths, “liberty” and the First Amendment have never been interpreted to protect a “fundamental right” to communicate via the Internet, let alone break copyright laws. So in the U.S., a government agency can access one’s Internet usage from an ISP without a warrant (and sometimes without a subpoena) and a subscriber’s relationship with his or her ISP is a creature of private contract, not statutory, let alone constitutional, protection.
I am not suggesting that America adopt any or all of the French code-based legal system. What I believe this shows, however, is that even cultures which most Americans would regard as less concerned with the basic freedoms of its citizens — Americans would never stand for a system under which prosecutor and judge were combined in a single agency, judge or other government official — can teach us something about the values underlying the legal relationship of people to their government. Here in America we are blessed with constitutional rights. But basic human needs, like housing, jobs and medical care, are not a legal right. Internet access is very important to success in today’s economy, and I for one suggest that perhaps a debate on whether relegating that issue to the private, unilateral terms of service (ToS) of ISPs and Web site operators is a paradigm that is unlikely to be successful in the long term.
Goodbye “freedom fries.” You Frenchies aren’t so bad after all.
Tom O’Toole at BNA TechLaw writes that Supreme Court nominee Sonya Sotamayor is unlikely to have any substantial influence on the Court’s cyberlaw jurisprudence because there basically is none:
The Supreme Court has never reviewed a case involving the Computer Fraud and Abuse Act.
The Supreme Court has never reviewed a case involving the Electronic Communications Privacy Act.
The Supreme Court has never reviewed a case involving Section 230 of the Communications Decency Act (which gives interactive computer services immunity from most claims arising from the publication of third-party content), though it did consider, and strike down, the prohibitions against indecent online speech contained in another part of the CDA in Reno v. American Civil Liberties Union, 521 U.S. 844 (1997).
The Supreme Court has never reviewed a case involving the CAN-SPAM Act or the Digital Millennium Copyright Act.
The Supreme Court has never reviewed a case involving electronic contracting, jurisdiction arising from online activities, cybersquatting or any other domain name-related dispute.
Aside from Doe v. Chao, a case involving standing to sue the federal government under the Privacy Act, the Supreme Court has never taken a case involving online privacy or security (GLB, COPPA, FTC Act, you name it). If you want to count Bartnicki v. Vopper, go ahead, though I don’t think that obscure decision in any way undermines the point I am trying to make here.
He’s right, but I find that a plus, not a minus. The evolution of this rapidly changing medium really does not need the glacial pace at which the Supreme Court decides issues, and certainly benefits from the pull-and-tug among lower courts to strike the appropriate balances among regulation, civil rights, legislative power, law enforcement and the other technology policy matters affecting the Internet. When the Supreme Court speaks on tech issues — witness the Sony Betamax case from nearly 25 years ago or the Brand X decision from 2005 — it often leaves the law in a more polarized and confused state than before. So IMHO, we don’t need no stinkin’ badges from the Supremes.
Technology has fundamentally changed the way we interact, do business and make political decisions over the past 15 years. And yet now, after an historic election, the Luddites are saying that technology has no place in government. According to the New York Times, on taking office as president in January, Barack Obama will be forced to stop using email and turn in his BlackBerry. Say Goodbye to BlackBerry? If Obama Has to, Yes He Can [NYTimes.com].
The rationales given for this are plain stupid — that presidential records need to be preserved and that private communications might be intercepted. The Bush Administration has ignored email preservation anyway. And all presidential communications, including face-to-face conversations, can be leaked, recorded or intercepted, regardless of technology. No, this reactionary rule is simply an effort by the Secret Service and the permanent bureaucracy in Washington to prevent change, to keep the president in the “walled garden” of the White House. John Kennedy famously went around the bureaucracy (which he compared to “nailing Jello to the wall”) and cultivated direct relationships with agency staffers. Barack, I’ll give you an email alias to use from your iPhone if you want. And I bet your friend Eric Schmidt at Google could do you even better!!
I’ll let my op-ed in Sunday’s San Jose Mercury News speak for itself. Opinion: In the Tech Industry, Small Isn’t Beautiful Anymore. Might be a little narcissistic to blog about one’s own article, no?
Wrangling over the proposed Google-Yahoo advertising deal makes one wonder whether scale, a virtue in Silicon Valley, can also be a vice. Some have insisted that Google is too big. But with apologies to economist E.F. Schumacher — author in 1973 of the generational anthem “Small Is Beautiful” — big isn’t bad anymore, it’s good.
A mere 10 years old, Google so dominates Internet search that the company’s name has become a verb. Google has grown large because it is good and its engineers continue to design innovative new products. That is something Web aficionados and antitrust regulators should applaud.
Google has already changed the way businesses advertise. The advertising issue is one its critics point to as evidence that Google is so large, the antitrust laws should kill the Google-Yahoo advertising venture before it launches later this month. The idea, as some ad agents have said, is that a combined Google-Yahoo share of “Internet search advertising inventory” would be competitively harmful. This is mushy reasoning being peddled to spread economic paranoia.
Everyone agrees that the principal objective of antitrust law is economic efficiency. To assess Google-Yahoo, therefore, one must first define what market we’re talking about. References to Internet search “inventory” are analytically dishonest, disguising the fact that search advertising — of which Google holds a 63 percent share — competes directly with Internet display advertising. Online display advertising is commanded by MySpace, AOL and Microsoft, and Google’s presence is tiny. As the data on rapidly declining advertising revenues for newspapers, network television and other “legacy” media reveal, Internet advertising is also becoming a substitute for advertiser dollars that used to flow elsewhere.
The consequence is that the relevant market cannot exclude Internet display advertising or even be limited to Internet advertising. And once the market covers something more than search ads, all serious competitive arguments against the Google-Yahoo transaction fade away. Take just a few.
Microsoft insists the alliance is unlawful price fixing because it will increase search advertising prices. To the contrary, neither Google nor Yahoo will be able to dictate minimum bids or prices to the other and, since advertisers will have a greater supply of more valuable search ads to buy — the demographically targeted ads produced with Google’s famously secret algorithms — the relative price for Internet search advertising will go down. That’s simple supply-and-demand, and it’s a good thing.
Others argue that Yahoo needs to remain independent and cannot be allowed into Google’s orbit. But this is not a merger or acquisition. If Yahoo’s board of directors, having just finished a bruising battle with Microsoft, violated its duty to maximize shareholder value, that is hardly the same as eliminating a competitor from the market.
Some suggest the government must act quickly to nip the growing power of Google in the bud. But in our market system we do not punish a successful company because it might do something bad in the future. Microsoft should be especially ashamed for endorsing this suggestion, since its decade-long antitrust fights here and in the EU arose from its bad acts, not its bigness. And unlike a merger, there can be no problem here of “unscrambling the egg” if things go south.
That leaves the only real objection to the Google-Yahoo! alliance as consumer privacy. There may be valid privacy objections to Google’s activities; indeed, Google might someday become so big that its possession of huge troves of personal data alone creates a threat to privacy. But as the FTC decided in approving the Google-DoubleClick merger in 2007, antitrust laws are not a substitute for privacy regulations.
So even here, privacy and bigness are not enemies. Unless Google starts acting badly in the competitive marketplace, the government should just leave it alone.
Glenn B. Manishin is an antitrust partner with Duane Morris in Washington, D.C. He was counsel for ProComp, CCIA and other software competitors challenging the Bush administration”s antitrust settlement with Microsoft. He wrote this article for the Mercury News.
Wow, I’ve blogged in the past about how Real Networks’ devotion to subscription music distribution was an archaic business model. Now, Rob Glaser and company are about to launch a new software product that, if ruled lawful under the DMCA, may revolutionize movie distribution. Real Networks Throws Down the DVD Copy Gauntlet [FT.com]. In a post-Napster legal environment, however, it is fair to say that no one can predict with certainty how these sorts of issues will play out. But if Cablevision can offer a remote-storage DVR on the theory that users are copying, not the device’s software, there is a good chance Real is right. Good luck and Apple TV watch out now!
That’s what Andrew Orlowski of the UK’s The Register calls Friday’s decision by the Federal Communications Commission to cite Comcast for unlawful violation of "network neutrality" principles. One can agree or disagree with the proposition, endorsed by FCC Chairman Kevin Martin, that Internet users should be free to reach any site without interference by their ISPs.
“We are preserving the open character of the Internet,” Martin said in an interview after the 3-to-2 vote. “We are saying that network operators can’t block people from getting access to any content and any applications.”
But it is just absurd to conclude that any federal government agency should be allowed to issue what it expressly terms a set of non-binding "principles" and then make an official finding of illegality when a company fails to follow those principles. Confusing is an understatement here. Dissenting Commissioner Rob McDowell’s complaint that the FCC here is actively regulating the Internet — or at least historically unregulated "enhanced services" offered by ISPs, unlike common carrier telecommunications services — is spot on.
The recent history of antitrust — from Microsoft to PeopleSoft to Whole Foods — is one in which the conventional wisdom of how to define the “market” affected by mergers and other transactions is not infrequently dead wrong. Today’s big deal is Yahoo! establishing a test advertising outsourcing deal with Google. Many observers, including Microsoft’s General Counsel, have already opined that such a deal would be DOA, as it would add to the dominant firm in the “search advertising market.”
But is that really what’s going on here? I am not so sure. Search is only important as a vehicle by which web sites and portals aggregate users to sell to advertisers. It is also free to non-enterprise users. So a cogent argument can be made that Internet search is irrelevant except as an advertising tool and that Internet advertising is NOT the relevant market for this deal, because online advertising already is or shortly will be competitive with (in other words, a substitute for) traditional media advertising like radio, newspapers and magazines. And to limit Internet advertising to “search advertising,” but ignore the fact that it is AOL, Microsoft and Yahoo! who collectively have a significant advantage in non-search Internet advertising — which seems to account for a majority of all Internet advertising — on first blush suffers from that same old market defintion problem.
In fact, here’s what the Wall Street Journal had to say this morning:
Major brand advertisers are gearing up to move big chunks of money from traditional ads including TV commercials and glossy magazine spreads to online outlets such as video-sharing services and Web sites for women. Although online ads garnered only an estimated 7% of total U.S. advertising dollars last year, Internet companies believe the percentage will increase sharply as Americans ratchet up their daily use of the Web and advertisers gain confidence in the medium.
As an antitrust lawyer, that tells me the data to establish that Internet ads are a subset of a broader advertising market — one in which, almost by definition, Google is not a “dominant” or even large player — may be there. Now it’s up to the advocates, economists and enforcement officials to figure out the answer.
Disclaimer — I have provided analysis to stock brokers and market research analysts on the Microsoft-Yahoo! fight, but am not currently working as a lawyer for any party to or company interested in the potential transaction.
In response to what it terms its “customer’s needs,” Cisco will start to embed “lawful interception” capability into its router products. [C|Net News.com] What’s really going on here is that the convergence of packet-switched and circuit-switched networks is accelerating. So the law enforcement community is no longer content to give the Internet and ISPs a free ride when it comes to digital wiretapping, despite the Communications Assistance for Law Enforcement Act (CALEA). Cisco can’t be blamed, since it’s job is to sell products, but this is just another sign that the days of anonimity on the Internet are numbered.
Microsoft’s Steve Ballmer, once again on an anti-open source crusade, now says that Linux is a “cancer” but that the new Windows Server 2003 product can compete with free software because is it “innovative.”
Innovation is not something that is easy to do in the kind of distributed environment that the open-source/Linux world works in. I would argue that our customers have seen a lot more innovation from us than they have seen from that community. . . . Linux itself is a clone of an operating system that is 20-plus years old. That’s what it is. That is what you can get today, a clone of a 20-year-old system. I’m not saying that it doesn’t have some place for some customers, but that is not an innovative proposition.
All this from the company that brought us a desktop GUI in 2000 that Apple made available in 1987, that specializes in buying technology developed elsewhere (DOS, PowerPoint, IE, etc.) and that still cannot fugure out how to put a laptop computer to sleep. Eat your Cheerios, Steve, you’re going to need them. All you have is monopoly power; in the long-run, that’s not enough to save the company.
America Online on Tuesday said it is filing five lawsuits against individuals and companies that are allegedly purveying bulk unsolicited e-mail, or spam, to its members. America Online Sues Spammers [CNET News.com]. Boowah! Spam is destroying the Internet’s real killer app, e-mail, by forcing users towards filtering software that kills the good unsolicited messages along with the hundreds of bad ones for Viagra, penis enlargement and Nigerian ex-dictator’s wives fortunes. It is preventing legitimate marketers from communicating with customers and raising costs for ISPs, enterprises and regular Joes. Legislation won’t do anything. AOL, we salute you!
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June 11th, 2009 | 
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