Video Broadcast Flag Battle Continues Over Senate Draft

A broadcast flag provision in Chmn. Stevens’ (R-Alaska) proposal is appropriately narrow in its focus on indiscriminate redistribution of digital broadcast TV content online, Glickman said. But critics said the flag shouldn’t have been in the bill, which includes video franchise, universal service fund reform and other hot topics. The language isn’t perfect, but many industry players now support incorporating the broadcast flag provision in S-2686, Glickman said. The bill would protect video programming by giving the FCC authority to implement rules it adopted over 2 years ago and set to take effective last July, he said.

The U.S. Appeals Court, D.C., ruled the agency lacked jurisdiction over copy protection mandates. Electronic Frontier Foundation (EFF) staff attorney Fred von Lohmann said that’s where the debate over the flag should have ended. “The regime was always unnecessary, and perhaps is more unnecessary now than ever,” he said. S-2686’s flag provision “represents the worst kind of kowtowing to Hollywood” because it “has nothing to do with this bill… or the important issues being debated in the context of telecom reform,” von Lohmann told us.

Stevens’ language is “fair and workable” and there are several reasons to include it, Glickman said. The bill would protect the quality of free over-the-air-broadcasts in the digital age, he said. Cable and DBS use scrambling, and if broadcast TV isn’t similarly protected, content providers will send high-value programming where it can best be safeguarded from illegitimate Web distribution, he said. Von Lohmann called the flag a “waste of time as a piracy prevention mechanism” since there are already strong industry incentives to fight file-swapping. Besides, the high-tech evolution has called MPAA’s bluff, he said: “It hasn’t been the catastrophe that the movie studios and networks claimed.” Hollywood is making more content than ever available in HD and there hasn’t been an explosion of high-definition piracy, he said.

The bill is “bad for fair use, bad for innovation” and will effectively ban most inexpensive ways consumers can get DTV at home, von Lohmann said. But Glickman said S-2686 brings certainty to the consumer electronics market, already making gear complying with FCC broadcast flag rules. The bill also promotes IP protection, which promotes job creation, he said. “Protecting intellectual property will become a recurring and increasingly important theme for our economy in the decades to come,” Glickman said: “This nation will prosper or it will fail in large part based on how we protect our nation’s greatest assets… the skill, ingenuity and creativity of our people.”

The movie industry loses about $6.1 billion yearly to piracy, Glickman said. Without a broadcast flag provision, that could grow exponentially with the transition to DTV, he said. “There is broad consensus that this is an issue that needs to be addressed,” Glickman said: “There is also broad consensus on the nature of the solution considered. I believe the discussion draft legislation released last week is fully consistent with that consensus and should be swiftly enacted.”

If Hollywood really wanted to snuff online piracy, it would have made all its content digital by now, von Lohmann said. Standard definition programming is the format most vulnerable to piracy, and that’s what makes up most of the files shared illegitimately on the Web, he said. Digital content is “the most piracy-proof medium they have today,” because of the large file sizes, von Lohmann said.

Under S-2686, the FCC would hold a proceeding on setting exceptions for distance education, said Jonathan Band, counsel for the American Library Assn. (ALA). But Congress should fashion exceptions, “rather than delegate that task to a regulatory agency,” he said. Discussions underway could lead to an exception lawmakers could include in the statute, he told us. The ALA was among those to sue the FCC over the flag.

NAB backs the flag provision’s “broad parameters,” but is concerned about protecting copyright exemptions for local news, for many stations the highest-value programming, a spokesman told us. On the audio flag, NAB wants private talks to continue among its representatives, RIAA and others, he said. The first Stevens draft had more protections and allowed more uses than the 2nd, a Public Knowledge spokesman said: “We still don’t like any tech mandates, but with that in mind, we think the first draft was the lesser of the evils.”

One worry Glickman included in his written testimony but not his oral remarks involved a related House bill. HR-1201 would sacrifice anticircumvention provisions of the Digital Millennium Copyright Act (DMCA), doing “much more harm than good,” he said. He echoed comments by Universal Music Group (UMG) Gen. Counsel Michael Ostroff at a House Commerce Committee hearing last month. Ostroff said HR-1201 would undermine the legitimate digital music marketplace by granting consumers a “hacking right.” The bill, introduced by Chmn. Barton (R-Tex.) and Rep. Boucher (D-Va.), would give consumers the right to sidestep copy protection measures for “fair use” purposes. There hasn’t been much movement on HR- 1201 since the congressional net neutrality brawl began, but von Lohmann thinks Barton still believes in the cause, he said.