Dominant Players Give Rise to Competition, Copyright Concerns

Intellectual property rights are starting to raise market power concerns, said Malcolm Webb, a partner at Webb Henderson. Telco market power comes primarily from network investments, he said; however regulation was developed to keep it in check.

Apple and Google are joining Microsoft as companies raising competition law concerns, Webb said. Competition authorities and regulators have taken the view that market power can arise from IPR, as it did from physical networks, Webb said, and watered down rights is the result in some instances. IPR-based standards, platforms and content are important to telcos’ future, Webb said. Proprietary technology “may well play a greater role” in industry development, Webb said.

Platforms can cause particular competition problems when they're the only or the primary way of accessing particular content or services, Webb said. “Extremely technical” copyright disputes that cross jurisdictions, platforms and standards may be a good fit for alternative dispute resolution, said Richard Owens, director of copyright e- commerce in the World Intellectual Property Organization’s Technology and Management Division, citing the Internet. “Speedy solutions are extremely important,” Owens said.

“Copyright is deeply challenged” because of technology, Owens said. Alternative dispute resolution for copyright is becoming more relevant for access to content with rights management in situations when it must be made available under authorized exemptions or limitations, Owens said. He mentioned the cases of teaching, archiving and access by certain handicapped persons.

Authorized and unauthorized content sharing and its ubiquity have spurred new expectations, Owens said. Developing countries agitating for more access to e- publishing scientific journals are causing economic, social and legal strains, Owens said. Notice and takedown procedures are another area for possible alternative dispute resolution process, Owens said. Notice and takedown worked well for a few years, Owens said, however new technologies have emerged since 1998. What happens when notice and takedown for the Internet of ten years ago doesn’t account for new developments, Owens asked.

New cases are challenging notice and takedown in Europe, Owens said. Internet intermediaries in European cases removed content in compliance with a rights holder request; however users immediately re-posted it under another name “on a massive scale,” Owens said. The Internet intermediaries mentioned were search engines, portals, ISPs and user generated content sites. The volume of reposting and illegal content posted on user generated content sites is raising new questions, Owens said.

Google has developed tools to help people easily claim their content, said Yoram Elkaim, the company’s head of legal in Southern and Eastern Europe, the Middle East and Africa. YouTube’s 350 million unique monthly visitors upload 20 hours of video every minute, Elkaim said, equivalent to 57,000 feature films each week. YouTube has had notice and takedown for a while, Elkaim said. However, rights holders don’t generally want to suppress their content, he said: “They want control of it.” More than 1000 partners now use YouTube’s content identification system with more than 1 million reference files and 100,000 hours of material, he said. -- Scott Billquist

ITU Telecom Notebook …

Total attendance at the ITU Telecom conference reached 15,278 from 184 countries at the end of the second day of the five-day event. That’s less than half of the 40,000 that ITU had predicted as the show opened, which itself was about one- fifth of the attendance at the event in the past. Exhibitors told us that, despite getting significant last-minute discounts in the cost of the booth space, they were seriously disappointed with booth traffic. Some said they had already decided not to exhibit in 2011, regardless of terms offered. It was also obvious on the exhibit floor that possibly the majority of floor space was taken up by national pavilions, international organizations and others affiliated with ITU, rather than by typical trade show exhibitors.

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Alvarion unveiled two new WiMAX deals during the conference, one with Clearwire for Spain and the other with Kenyan mobile services provider Safaricom. Clearwire is to begin WiMAX service in urban areas of Spain next year using Alvarion equipment. The Safaricom is a three-year project to deploy WiMAX throughout Kenya. Terms weren’t disclosed for either deal.

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Network neutrality is misconstrued and misunderstood, Anoop Gupta, Microsoft corporate vice president for technology policy and strategy told an ITU Telecom World Forum on adapting to change. Nothing in the idea says operators can’t charge different prices for different service levels, Gupta said. The cost for low latency, high bandwidth applications can’t be the same as best efforts connections with the same bandwidth requirements, said Carsten Schloter, CEO of Swisscom. Maintaining Internet openness for devices, services and applications has to account for a reasonable rate of return, Gupta said. Falling return on capital goes against political interest in sustainable networks, Schloter said. Revenue must stabilize at a level where the financial incentive is kept alive, he said. A few users can’t be allowed to spoil a $10 billion network investment, Schloter said. There are differences between fixed and wireless services, said Tadashi Onodera, president and chairman of KDDI Corporation. Wireless is a limited resource used by many people, he said. The company can limit use to normalize traffic, Onodera said. - SB

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Competition and meeting consumer demand remain the toughest aspects of doing business even with the economic downturn, senior industry executives said at an ITU Telecom World forum on adapting to change. The economic crisis hasn’t been as rough as the constantly changing technology and business landscapes, said Anoop Gupta, Microsoft’s corporate vice president for technology policy and strategy. Strategic long-term efforts are still taking place, he said, referring to search, the business market and cloud computing. “Rapid change is the only constant” for the software industry, Gupta said. The major challenges for Telekom Malaysia are improving existing business, reducing inefficiencies and sharpening performance, said Dato Zam Isa, the company’s CEO. Future business requires heavy investment, Isa said referring to the move to an all IP network. Investment payback periods have become shorter and shorter, said Sean Cai of ZTE. Products that take too long to arrive may miss market windows, he said. “Innovation, Innovation, innovation” is crucial to differentiating products from the competition, Cai said, but consumers also demand low prices. Despite the recent downturn, ZTE’s revenue growth was 40 percent higher in the first half of 2009 than a year earlier, Cai said. - SB

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Reform of the whole intellectual property system is needed, Richard Keck, a lawyer with Macmillan Keck, said at a ITU Telecom World forum on intellectual property rights and information and communications technology. The lengthy time required to get a patent creates more problems and leads to more disputes, Keck said. Higher government appropriations or up-front fees could cut down uncertainty, which only rises over time, Keck said in referring to years-long patent approval processes. The current system has the flexibility to deal with disputes arising from interoperability, said Richard Vary, a senior IPR litigation counsel at Nokia. The system can be abused, he noted.