January 2014

House Judiciary Ponders Fair Use

Just what was and wasn't a transformative work in terms of fair use protections was a hot topic in a House Judiciary Subcommittee on Courts, Intellectual Property and the Internet hearing on that carve-out from copyright protections.

The witnesses had much to say on both sides of the debate on whether fair use has kept up with the digital transformation of content. Subcommittee Chairman Howard Coble (R-NC) set up the debate with the observation that the strength of fair use was its ambiguity, which leaves the courts to clarify on a case-by-case basis, but that ambiguity was also its greatest weakness. American University professor Peter Jaszi carried the standard for a broad interpretation of fair use. Asked by Coble whether a definition of "transformative" should be codified, Jaszi said it would be great mistake to "arrest the judicial process by reducing it to a narrow definition." He also said anyone arguing to narrow fair use had a high bar to clear.

Tablet Ownership Rate Reaches New High of 44 Percent, According to CEA’s Tablet Report

More than four in ten (44 percent) online US consumers owned tablets as of December 2013, an increase of six percentage points from December 2012 (38 percent).

The Consumer Electronics Association’s Consumer Outlook on Tablets: Adoption, Sentiment and Social Media Conversation (January 2014) report examines trend information on consumer behavior and sentiment regarding tablet computers. “Tablets had a strong 2013 holiday season, particularly on Black Friday, but are showing the beginning signs of market saturation.” Looking ahead, nearly three in four (70 percent) online consumers expect to purchase tablets sometime in the future, holding steady with purchase intent figures reported by CEA last quarter. Among tablet owners, screen size plays an important role in portability and viewing content, and ownership seems to be shifting somewhat to smaller screens. Among current owners, small screens of seven to eight inches have increased from 25 percent ownership in June 2013 to 32 percent in December 2013. Conversely, ownership of medium screens 8.9 to 10.1 inches have decreased from 73 percent in June 2013 to 68 percent in December 2013.

Lavabit case highlights legal fuzziness around encryption rules

While privacy advocates may see Lavabit as bravely defending US privacy rights in the online world, federal judges hearing its appeal of contempt-of-court charges seem to regard the now defunct encrypted email service as just being tardy in complying with government court orders.

Attorneys from both Lavabit and the US government agreed that the legal issues between them could have been resolved before heading to court, though neither party seemed to have an adequate technical answer of how Lavabit could have successfully passed unencrypted data to a law enforcement agency in order to meet the government's demands. Three judges from the 4th US Circuit Court of Appeals in Richmond (VA) heard Lavabit's appeal of a contempt-of-court ruling, which it had incurred for not turning over to the government unencrypted data of a single user, presumably Edward Snowden. Judges Roger Gregory, Paul Niemeyer and Steven Agee presided over the hearing.

The NSA saga: Surprising turns and ominous allegations

[Commentary] Out of nowhere the Republican National Committee, meeting in Washington, passed by voice vote a resolution denouncing the National Security Agency surveillance as an “unconstitutional…intrusion on basic human rights that threatens the very foundation of democratic society.” The committee also recommended the creation of a special committee to “investigate, report and reveal to the public the extent of this domestic spying.” The RNC resolution demands action to “hold accountable the public officials who are found to be responsible for this unconstitutional surveillance.” RNC officials stated that the resolution was not a fluke but represented the consensus within the committee.

While there is an amusing side to the apparent disarray in the Republican response to the NSA revelations, US high tech companies were certainly not amused by the other occurrence: Edward Snowden’s direct that the US government not only spies for security and diplomatic purposes but also to further goals of industrial espionage -- including hacking into private networks of Siemens and other German multinationals. What is missing here is a direct connection between whatever alleged NSA economic espionage is gleaning and a feeding system to individual US companies -- which is what the US government believes is occurring routinely in China. But still Snowden’s claims have already had wide impact in Germany and Europe. They will only feed into costly (and futile) attempts by European and other countries to seal off their internet space and to exclude US companies that are deemed unfairly to be “in bed,” willingly or not, with pervasive US security operations.

[Claude Barfield is a resident scholar at AEI]

TV Stations in Los Angeles to Share a Channel to Free Up Spectrum

Two broadcast television stations in Los Angeles will become the first participants in a pilot test of the government’s plans to eventually free up and auction off more airwaves for use in wireless broadband.

KLCS, a public broadcaster, and KJLA, a small multilingual programmer, will participate in a channel-sharing experiment that is being devised with the trade association for wireless phone carriers. The wireless companies are eager to get broadcasters to give up airwaves so they can buy them and use them for high-speed wireless Internet connections. The experiment is intended to show the extent to which broadcast channels can be squeezed together on the electromagnetic spectrum without degrading the quality of their signals. If the experiment goes as planned, no changes will be visible to consumers, who will continue to tune in to the same channels on their television sets. But the eventual result could be quite significant for consumers -- less wireless phone congestion and better connections for smartphones to fast wireless Internet service.

Government officials, though not involved in this trial, are likely to be watching the results closely. If successful, the trial will go a long way toward proving the viability of the plans of the Federal Communications Commission for what it calls an incentive auction of airwaves. In those auctions, television stations that give up some or all of their space on the broadcast spectrum will receive money from the auction sales.

Shareholders Approve $130 Billion Verizon Wireless Deal

Verizon Communications cleared a final hurdle in its push to gain full control of its wireless joint venture with Vodafone Group Plc (VOD) after investors from both companies approved the $130 billion deal. Following the vote, Verizon plans to issue 1.28 billion shares to shareholders of Vodafone. Verizon expects to complete the takeover of Verizon Wireless on Feb 21. The company still needs approval from the High Court of Justice of England and Wales.

Commerce Promotes Digital Economy at State of the Net

At the State of the Net conference, Commerce Secretary Penny Pritzker shared the Department’s commitment to promoting policies that support America’s digital economy. And she pledged to act as the champion of good Internet policy that supports entrepreneurs, businesses, and their workers.

At the National Telecommunications and Information Administration (NTIA), we’re working to fulfill that pledge by continuing to work -- both domestically and internationally -- to champion the multistakeholder model for developing Internet policies. The Internet is a diverse, multi-layered system that thrives only through the cooperation of many different parties. Solving policy issues in this space requires engaging these different parties -- businesses, policymakers, civil society leaders, and others. They are all partners in the process, each with the ability to participate and have a voice in the outcome.

[Lawrence E. Strickling is Assistant Secretary for Communications and Information and NTIA Administrator]

Chairman Rockefeller to Target: Why Haven't You Reported Data Breach to The Securities and Exchange Commission

Chairman John D. (Jay) Rockefeller IV sent a letter to Target asking why the company has not yet reported its recent massive data breach to the Securities and Exchange Commission (SEC), as the SEC recommended in an October 2011 guidance. “A data breach involving the theft of personal information about tens of millions of Target customers is clearly a material cyber attack that has affected how your business operates. I am therefore puzzled why your company has not yet updated its SEC filings to reflect this event. Your failure thus far to provide this information to your investors does not seem consistent with the spirit or the letter of the SEC’s financial disclosure rules,” Chairman Rockefeller wrote.

USDA Investments In Rural Public Television Stations

The United States Department of Agriculture Deputy Under Secretary for Rural Development announced investments in rural telecommunications infrastructure and equipment to expand access to education and economic development for rural residents.

USDA Rural Development is awarding grants through the Public Television Digital Transition Grant program. Six grants total more than $2.5 million. In Alaska, USDA has selected Bethel Broadcasting for a $718,656 grant to help station KYUK buy digital production equipment. The station will convert to digital a low-power transmitter for public channels that are part of the Alaska Rural Communications Service. Digital transmission is important to remote towns like Bethel, which can only be reached by air. Bethel has more than 60 percent Yup'ik Eskimo residents and serves as an administrative and transportation hub for nearly 60 surrounding Native Alaskan villages in the Yukon-Kuskokwim Delta region. Public Television Digital Transition grants may be used to acquire and install facilities and software necessary for the transition. The grants also may be used for associated engineering and environmental studies.

What The Internet Thinks About Chicago

Here is what the Internet thinks of Chicago: It’s cold. It’s windy. It’s segregated. It’s dangerous. That is based on Google’s “auto complete” feature when web users type in the words “Why is Chicago so …”

From the Google support page, here is how the search engine determines the results: “As you type, Autocomplete predicts and displays queries to choose from. The search queries that you see as part of Autocomplete are a reflection of the search activity of users and the content of web pages indexed by Google.”