Law and Information

Today, I attended a small, but really interesting conference chaired by my colleagues Professor Werner Wunderlich und Prof. Beat Schmid from the Institute for Media and Communication Management, our sister institute here at the Univ. of St. Gallen. The conference was on “The Future of the Gutenberg Galaxy” and looked at trends and perspectives of the medium “book”. I’ve learned a big deal today about the current state of the book market and future scenarios from a terrific line-up of speakers. It was a particular pleasure, for instance, to meet Prof. Wulf D. von Lucus, who’s teaching at the Univ. of Hohenheim, but is also the Chairman of the Board of Carl Hanser Verlag, which will be publishing the German version of our forthcoming book Born Digital.

We covered a lot of terrain, ranging from definitional question (what is a book? Here is a legal definition under Swiss VAT law, for starters) to open access issues. The focus of the conversation, though, was on the question how digitization shapes the book market and, ultimately, whether the Internet will change the concept “book” as such. A broad consensus emerged among the participants (a) that digitization has a profound impact on the book industry, but that it’s still too early to tell what it means in detail, and (b) that the traditional book is very unlikely to be substituted by electronic formats (partly referring to the superiority-of-design-argument that Umberto Eco made some time ago).

I was the last speaker at the forum and faced the challenge to talk about the future of books from a legal perspective. Based on the insights we gained in the context of our Digital Media Project and the discussion at the forum, I came up with the following four observations and theses, respectively:

Technological innovations – digitization in tandem with network computing – have changed the information ecosystem. From what we’ve learned so far, it’s safe to say that at least some of the changes are tectonic in nature. These structural shifts in the way in which we create, disseminate, access, and (re-)use information, knowledge, and entertainment have both direct and indirect effects on the medium “book” and the corresponding subsystem.

Some examples and precursors in this context: collaborative and evolutionary production of books (see Lessig’s Code 2.0); e-Books and online book stores (see ciando or Amazon.com); online access to books (see, e.g., libreka, Google Book Search, digital libraries); creative re-uses such as fan fiction, podcasts, and the like (see, e.g., LibriVox, Project Gutenberg, www.harrypotterfanfiction.com).

Law is responding to the disruptive changes in the information environment. It not only reacts to innovations related to digitization and networks, but has also the power to actively shape the outcome of these transformative processes. However, law is not the only regulatory force, and to gain a deeper understanding of the interplay among these forces is crucial when considering the future of books.

While fleshing out this second thesis, I argued that the reactions to innovations in the book sector may follow the pattern of ICT innovation described by Debora Spar in her book Ruling the Waves (Innovation – Commercialization – Creative Anarchy – Rules and Regulations). I used the ongoing digitization of books and libraries by Google Book Search as a mini-case study to illustrate the phases. With regard to the different regulatory forces, I referred to Lessig’s framework and used book-relevant examples such as DRM-protected eBooks (“code”), the use of collaborative creativity (“norms”), and book-price fixing (“markets”) to illustrate it. I also tried to emphasis that the law has the power to shape each of the forces mentioned above in one way or another (I used examples such as anti-circumvention legislation, the legal ban on book-price fixing, and mandatory copyright provisions that preempt certain contractual provisions.)

The legal “hot-spots” when it comes to the future of the book in the digital age are the questions of distribution, access, and – potentially – creative re-use. The areas of law that are particularly relevant in this context are contracts, copyright/trademark law, and competition law.

Based on the discussion at the forum, I tried to map some of the past, current, and emerging conflicts among the different stakeholders of the ecosystem “book”. In the area of contract law, I focused on the relationship between authors and increasingly powerful book publishers that are tempted to use their unequal bargaining power to impose standard contracts on authors and transfer as many rights as possible (e.g. “buy out” contracts).

With regard to copyright law, I touched upon a small, but representative selection of conflicts, e.g. the relation between right holders and increasingly active users (referring to the recent hp-lexicon print-version controversy); the tensions between right holders and (new) Internet intermediaries (e.g. liability of platforms for infringements of their users in case of early leakage of bestsellers; e.g. interpretation of copyright limitations and exemptions in case of full-text book searches without permission of right holders); the tension between publishers and libraries (e.g. positive externalities of “remote access” to digital libraries vs. lack of exemptions in national and international copyright legislation – a topic my colleague Silke Ernst is working on); and the tension between right holders and educational institutions (with reference to this report).

As far as competition law is concerned, I sketched a scenario in which Google Book Search would reach a dominant market position with strong user lock-in due to network effects and would decline to digitize and index certain books or book programs, for instance due to operational reasons. Based on this scenario, I speculated about a possible response by competition law authorities (European authorities in mind) and raised the question whether Google Book Search could be regarded, at some point, as an essential facility. (In the subsequent panel discussion, Google’s Jens Redmer and I had a friendly back-and-forth on this issue.)

Not all of the recent legal conflicts involving the medium “book” are related to the transition from an analog/offline to a digital/online environment. Law continues to address book-relevant issues that are not new, but rather variations on traditional doctrinal themes.

I used the Michael Baigent et al. v. Random House Group decision by the London’s High Court of Justice as one example (has the author of Da Vinci Code infringed copyright by “borrowing” a theme from the earlier book Holy Blood, Holy Grail?), and the recent Esra-decision by the German BVerfG as a second one (author’s freedom of expression vs. privacy right of a person in a case where it was too obvious that the figure used in a novel was a real and identifiable person and where intimate details of the real person were disclosed in the book.)

Unfortunately, we didn’t have much time to discuss several interesting other issues and topics that were brought up and related to the generation born digital and its use of books – and the consequences of kids’ changed media usage in a changed media environment, e.g. with regard to information overload and the quality of information. Topics, to be sure, that John Palfrey and I are addressing in our forthcoming book.

In sum, an intense, but very inspiring conference day.

Update: Dr. David Weinberger, among the smartest people I’ve ever met, has just released a great article on ebooks and libraries.

Last week, the European Commission unveiled its strategy to make Europe’s written and audiovisual heritage available on the Internet. From the press release:

Check out the program of the 5th Frankfurt Scientific Symposium, asking: “Is there any progress in alternative publishing? Problems of scholarly information economy.” The event takes place in Frankfurt on October 22 and 23, 2005. Impressive line-up of speakers. (Thanks to Sacha for the pointer.)

The German National Library reached an agreement with the German Federation of the Phonographic Industry and the German Booksellers and Publishers Association on the circumvention of technological protection measures (TPM) such as access and copy controls on CDs, CD-ROMs, and e-books. See also here and here.

According to the press release (English version via this site), the German National Library got a “license to copy” techno-protected digital content for “own archiving, for scientific purposes of users, for collections for schools or educational purposes, for instruction and research as well as of works that are out of print.” To avoid misuses, the library “will check user’s interest” for a copy of the technologically protected content. Further, the copies, which are subject to a fee, “will as far as possible be personalized by a digital watermark.” (Press release.)

Let’s recall the legal background of this agreement as recently described in this paper:

Article 6(4) of the EU Copyright Directive (EUCD) addresses the situation where beneficiaries of certain copyright exceptions provided for in article 5 EUCD are hindered from making use of those exceptions due to the technological lock-down of the work. It is under article 6(4) where the balance between the interests of rightholders and holders of related rights using technological protection measures on the one hand and the public on the other can be struck. The exceptions set out in article 6(4) are divided into two categories: the ‘public policy exceptions’ and the ‘private copying exception’. The public policy exceptions listed in article 6(4) – i.e. exceptions in relation to photocopying, copy and archive purposes of educational facilities, broadcaster’s own ephemeral recordings, non-commercial broadcasts, teaching and research, use by disabled individuals, and public safety – are mandatory. However, recital 51 EUCD makes clear that member states should take appropriate measures only in absence of “voluntary measures taken by rightholders, including the conclusion and implementation of agreements between rightholders and other parties”. However, according to article 6(4) subpara. 4, this exception do not apply to “on-demand”-services, i.e. works “made available to the public on agreed contractual terms in such a way that members of the public may access them from a place and at a time individually chosen by them.”

Against this backdrop, the German Copyright Act, transposing the EUCD into national law, stipulates that the rightholders are obligated to make available the necessary means which enable certain categories of permissible uses. Some of the exceptions and limitations, respectively, also apply to digital media, but others not (click here for an overview.) Furthermore, the Copyright Act does not define how this obligation must be accomplished. However, � 95b(2) provides a remedy against someone who violates the make-available obligation. According to this provision, someone who fails to make available the necessary means can be sued by the beneficiary.

In accordance with the EUCD’s approach, the German legislator hoped that agreements between rightholders and consumers/users associations will be reached. (See here). It seems that the agreement between the German National Library and the above-mentioned associations is an important step forward.