EFF Prepared Testimony at Copyright Office section 1201 rule-making hearings presented by EFF Staff Attorney, Gwen Hinze

May 15, Panel 1 - Non-infringing uses of DVDs

EFF Exemption Class 3 - DVDs with unskippable promotional material.

Thank you for the opportunity to testify at today\'s hearings.

The Electronic Frontier Foundation has proposed an exemption for audiovisual works released on Digital Versatile Disks that contain access control measures that interfere with the ability to control private performance, including the ability to skip or fast-forward through promotional material. We are seeking an exemption to allow DVD owners to eliminate unfast-forwardable advertisements, or in the alternative, to take all necessary technical steps to defeat the User Operation or UOP blocking feature, to permit consumers to fast-forward through these commercials on content they have lawfully acquired.

Copyright owners can use the UOP blocking technology to mark certain portions of a DVD in a way that disables the fast-forward functionality of a user\'s DVD player when the DVD is inserted into a user\'s player. This prevents viewers from fast-forwarding through marked content. Most, if not all, DVD-CCA-licensed DVD players respond to UOP blocking markers incorporated into DVDs because DVD manufacturers are required to produce DVD players that detect and respond to UOP blocking commands as a condition of obtaining a license from the DVD Format/ Logo Licensing Corporation.

The use of this technology by copyright owners to create zones of a DVD that consumers cannot fast-forward through clearly impedes a noninfringing use by a consumer. Copyright owners do not enjoy any exclusive rights over private performance in a consumer\'s living room. It is not one of the exclusive rights granted to copyright owners under s.106 of the Copyright statute. A consumer does not infringe any copyright right when she uses the fast-forward function on a DVD player to fast-forward through commercials on a DVD. However, copyright owners are effectively able to use UOP blocking to control what content viewers watch prior to a feature presentation and therefore can place a restriction on private performance. This restriction on private performance is implemented through a set of interlocking licensing schemes for DVD player manufacturers which, in turn, are premised on the use of an access control measure - Content Scrambles System, or CSS.

The use of UOP blocking in this way effectively removes the long-established limitation on copyright owners\' exclusive distribution right in the first sale doctrine, recognized in section 109 of the Copyright statute. There is nothing in the legislative history of the Digital Millennium Copyright Act that indicates that Congress intended to upset the historical copyright balance struck by Congress in the Copyright statute or specifically to expand section 106, or override section 109.

An exemption is justified here to remove this limitation on consumers\' private performance and to prevent copyright owners from using an access control and the legal sanctions of section 1201 to control consumers\' lawful uses, such as fast-forwarding, that fall entirely outside copyright owners\' exclusive rights.

The opponents of this exemption have made three main arguments:

First, the joint comments submitted by the MPAA and the other joint commenters claim that EFF has failed to meet the burden of establishing that the use of this technology has had a substantial adverse impact on consumers\' noninfringing use. The joint commenters argue that the fact that we have identified "only a handful of titles" with such technology means that we have not met this burden and that any harm caused to consumers is a mere inconvenience.

I have three comments in response.

First, I would like to address the standard of proof required. Unlike the motion picture industry represented here, it is not possible for consumers to provide comprehensive figures for the number of DVDs released in the United States with UOP blocked for fast-forwarding for two reasons: First, affected DVDs are not labeled, so a consumer can only learn that a DVD has blocked fast-forwarding if he or she inserts it into a DVD player and is not able to fast-forward. Second, even if individual users are aware that a DVD contains content that cannot be fast-forwarded through, there is no centralized place or method for recording and collecting this data.

It would be fundamentally inequitable to require consumers to identify every single title affected in order to meet the threshold burden in this proceeding. Such a standard would undermine Congress\' intended purpose - as stated in the Commerce Committee Report - to provide a fail safe mechanism to protect consumers\' noninfringing uses. In our view, it should be sufficient proof if the record contains evidence of a qualitative adverse impact on a user\'s ability to make a noninfringing use of a work, and evidence that a number of DVD titles carry that feature.

Second, as to proof of current substantial adverse effect, the evidence on the record in this proceeding clearly establishes that it is not just a handful of titles that are affected. 66 individual consumers submitted comments to the Copyright Office in support of this exemption. These comments describe their first-hand experience of encountering non-fast-forwardable promotional material on over 40 different popular titles. These titles included Lilo and Stitch, Beauty and the Beast, The Little Mermaid, The Lion King, Toy Story I and II, Monsters, Inc., A Very Merry Pooh Year, Bob the Builder, About a Boy, Blue Crush, American Pie II, The Sixth Sense, Ice Age, the Red Violin, Shawshank Redemption, the Bourne Identity, Baby Mozart and Rudolph the Red-nosed Reindeer.

An assessment of the substantial adverse impact on consumers requires consideration of both the number of titles which may contain UOP blocking, and the number of units of each of those titles that have been sold to consumers. All of the titles I mentioned are extremely popular and were high volume sellers. According to the 2002 Year End sales report from Video Business, in 2002 Monsters, Inc sold 11.8 million units, Ice Age sold 7 million units, Lilo and Stitch sold 6.6 million units in the last three weeks of December 2002 alone, and Beauty and the Beast sold 4.3 million units. In total, there are - just for those 4 titles alone - 29.7 million units in consumer households that may have been affected by the inability to fast-forward through commercial advertising. This is hardly an insignificant impact.

Third, in assessing the impact of these technological measures on noninfringing use, the nature of the harm to individual consumers must be taken into account. In the case of each of the 66 consumers who filed comments with the Copyright Office, the harm was significant, and rose beyond a mere inconvenience. They were not able to avoid the objectionable material. The harm was redoubled when they were not able to prevent their children from viewing the objectionable material on various Disney titles. A number of parents commented that they had specifically purchased DVDs as a means of controlling their children\'s exposure to commercial advertising, and were understandably upset when they could not fast-forward through that material. This is not a mere inconvenience.

The second argument made by our opponents is that the problem is amenable to a market solution, and therefore does not warrant granting an exemption. In support of this argument, the joint commenters point out that 99% of the DVD releases of Tarzan - one of the titles referenced in EFF\'s December comments, are no longer being released by Buena Vista Entertainment with unskippable commercials. They state that Buena Vista made that change three years ago, in response to market feedback. Even if it is true that 99% of the Tarzan disk releases do not contain unskippable ads, (which it is not possible for consumers to verify), there are 1% of the presumably millions of Tarzan DVDs sold which contain unskippable material.

In addition, the 66 comments filed by consumers in this proceeding indicate that this practice is still going on and has not stopped voluntarily as a result of negative customer feedback over the last three years. The bulk of those comments list DVD titles purchased or rented in 2003 or 2002. For instance, commenters complained that on titles rented or purchased as recently as January 2003, including "About a Boy", "The Red Violin", "Baby Doolittle\'s World of Animals", "A Knight\'s Tale" and Universal\'s "The Bourne Identity", they were not able to fast-forward through promotional material.

DVD publishers clearly have not decided to stop releasing DVDs with promotional material with disabled fast-forwarding despite consumers\' complaints. It is unclear that DVD publishers have any business incentive to do so. It is for precisely this reason that we believe that it is appropriate, and justified, for the Copyright Office and Librarian of Congress to step in and grant an exemption to allow consumers to lawfully bypass non fast-forwardable commercials.

The third argument made by our opponents is that "it is far from clear that this feature is an access control within the meaning of the statute." Given that the DVD-CCA claims trade secret protection for its multi-tiered licensing scheme, EFF has not been able to view the various license terms to determine exactly which technological protection measures on DVDs are invoked in disabling fast-forward functionality on a user\'s DVD player.

The joint commenters\' use of "this feature" presumably refers to UOP blocking. If so, it misconstrues our argument. We do not claim that UOP blocking is an access control and we have not sought an exemption to "circumvent" UOP blocking. Our argument, as explained in our submission, is that given that UOP responsiveness appears to be a requirement for a DVD-CCA licensed DVD player, it would be impossible for a consumer to override the UOP blocking response on their DVD player without circumventing CSS. This is because the interlocking set of licenses from DVD-CCA and other DVD licensing entities are premised on the use of CSS. It is the act of circumventing CSS that would put a consumer at risk of legal liability under section 1201(a).

It is the position of the copyright owners in litigation in two lawsuits - the Remeirdes case in the 2nd Circuit[1], and as recently as March 2003 in the summary judgment opposition papers they filed in the 321 Studios [2] case, (which is before the Court this morning) that CSS is an access control for the purposes of section 1201.

The fourth argument I would like to address is an argument about availability of works. There is no credible evidence that the use of unskippable or unfast-forwardable advertising is integral to any business model that benefits the public. It is not at all clear that the ability to embed unskippable content meaningfully encourages the distribution of creative works that would not otherwise be made available. A threat by copyright owners to withhold content if they are not able to insert mandatory commercials on DVDs seems implausible. If this exemption were granted, copyright owners could still insert ads, but consumers who had the know-how would be allowed to avoid viewing them.

Finally, I would like to emphasize that the exemption that EFF is requesting is narrowly tailored to permit consumers to make a noninfringing use of DVDs that they have lawfully acquired. The exemption would only permit users to eliminate mandatory advertisements on DVDs or alternatively, to take all necessary technical steps to defeat the UOP blocking response on a DVD player, for the limited purpose of giving consumers the ability to fast-forward through advertisements.

This exemption is not an invitation to commit copyright infringement. First, to the extent that copyright owners are concerned about potential copyright infringement, they would still retain all rights and remedies currently available to them under copyright law including the ability to bring a suit for infringement. Second, as section 1201(a)(1)(D) makes clear, the Librarian of Congress can only grant an exemption to permit noninfringing uses of a class of works. Finally, copyright owners can control the scope of any potential adverse effect of this exemption by limiting the number of DVD releases that contain unskippable content.

In balancing the harms here, any likely harm to copyright owners from granting this exemption is minimal, since the exemption would apply to a limited number of titles and copyright owners could control the scope of impact of the exemption by limiting releases containing unskippable content. By contrast, the present harm to consumers who have acquired these disks without any way to know prior to purchase of their unskippable content, and without any way to restore control of their private noninfringing use, is substantial.

Thank you.

[1] Universal City Studios v. Remeirdes, Reply Brief for Plaintiffs-Appellees at 63, note 43 (2nd Circuit, filed Feb 28, 2001.

[2] 321 Studios v. MGM Studios et al, Reply Memorandum of P & A in support of Motion for Partial Summary Judgment, filed March 28, 2003, p.7