[IP] Entertainment industry doesn't like new privacy-friendly p2p program Grouper
------- Original message -------
From: Joseph Lorenzo Hall <joehall@xxxxxxxxx>
Sent: 12/4/'05, 10:31
Grouper allows groups of 30 or less to share files over an encrypted
p2p "network"... and that's too much for the entertainment industry.
-Joe
----
http://www.latimes.com/business/la-fi-grouper12apr12,0,1076225.story
Testing Copyright Limits
Grouper's creators say it's not like other file-sharing programs. The
entertainment industry isn't so sure.
By Jon Healey
Times Staff Writer
April 12, 2005
Jennifer Urban, a law professor at USC, wanted to watch home movies of
her 7-month-old nephew Peter in England, but nothing seemed to work.
The videotapes and DVDs were in the wrong format, and the digital
movie files were too big to e-mail.
Then Urban hit on a software program called Grouper. And in addition
to movies of her nephew, Grouper offers Urban, who specializes in
copyright law, insight into how technology is testing the boundaries
of copyright in a digital age.
Like Kazaa and other popular file-sharing programs, Grouper allows
Urban to copy movies and pictures of young Peter directly from her
brother and sister-in-law's computer without worrying about formats or
oversized e-mail attachments. Unlike those global networks with
millions of users, though, Grouper also lets Urban pick and choose
with whom she shares online - and sets a strict limit of 30 people per
group.
"I'm very attracted to the privacy afforded by having a private group
protected by encryption, particularly for sharing letters, family
photos, movies, etc.," Urban said. "This isn't the case with other
peer-to-peer networks."
What makes Grouper troubling to some entertainment industry executives
are the other things people can do with it. For example, the program
lets people copy bootlegged Hollywood movies and listen to songs on
one another's computers, all without paying a dime to the studios,
artists or songwriters.
Grouper Network Inc.'s founders, Josh Felser and Dave Samuel, say the
built-in limits of their peer-to-peer software make it a poor
substitute for more controversial file-sharing programs such as Kazaa
and Grokster, which are hotbeds for piracy. In addition to limiting
the size and accessibility of groups, they say, their program requires
songs to be streamed - that is, played through the Internet - not
downloaded.
Those limits may not add up to a legal service, argues Nicolas Firth,
chairman of BMG Music Publishing Worldwide.
"I'm not so sure that I see a big distinction between this and, say,
Grokster because you're at 30 people," Firth said. "Where are you
going to draw the line at what constitutes unlicensed use of
copyrighted music?"
Firth's question has no clear answer yet, copyright experts say. Nor
have the courts settled many issues surrounding streaming, such as
whether streaming a song to a private group online violates a
songwriter's copyright over "public performance."
This murkiness has opened the door for Internet entrepreneurs like
Felser and Samuel to test the limits of copyrights.
Their innovation supplies a steady stream of new ways to access, use,
store and copy digital goods, raising a succession of unanswered
questions about how laws from the era of turntables and tape recorders
apply to a digital age when virtually every device can connect to and
share with other devices.
The Supreme Court is expected to clear up a few knotty issues later
this year when it issues a ruling in the major studios and record
companies' lawsuit against Grokster and StreamCast Networks Inc., the
company behind the Morpheus file-sharing software. Although that
ruling probably will affect a variety of technologies that can be used
both for legal copying and piracy, its most direct effect will be on
file-sharing programs that enable people to download whatever they
please from an unlimited number of anonymous people online.
Grouper, by contrast, is part of an emerging trend in the file-sharing
world to let people swap digital goods with a limited audience of
invited guests. Even if the justices rule against Grokster and
StreamCast, their decision will not necessarily affect these more
constrained approaches.
And Mill Valley, Calif.-based Grouper is just one of many new faces in
the ever-evolving world of file sharing. Like water behind a dam,
technological innovation continually flows through the cracks in the
legal shield erected around copyrighted works.
Felser and Samuel's previous effort had been San Francisco-based
Spinner.com, a pioneering online radio outlet. The pair sold Spinner
to America Online in 1999 for $320 million worth of AOL stock. They
continued working for AOL for a year or two before dropping out of the
high-tech world - Felser said he thought about buying a carwash, and
Samuel got into the high-end toilet business.
They got back into the software business a few years later, Felser
said, because they kept running into problems similar to professor
Urban's.
The last straw came in 2003 when Felser returned to the Burning Man
festival, an annual party for artists and others in the Nevada desert
east of Reno.
"I couldn't share all the video clips I had with my friends," said
Felser, an annual Burning Man pilgrim whose festival nickname is "the
Frog Prince."
The two set about developing a way to link people's hard drives into
private groups. The idea was to let people use the Internet to show
off their homemade goods and music collections, just as they might do
in their own homes.
The company's free software lets people invite others into secure
networks where each member can browse through the others' computers
and download files. Users are not anonymous, however; in compliance
with a new California law, the software requires people to reveal a
real e-mail address.
The company, funded by $3.5 million from private investors, plans to
make money by selling premium versions of the software, presenting
targeted advertisements and offering users the chance to buy images,
music and other digital goods.
To deter piracy, Grouper does not let users search for items outside
the groups they've been invited to join. And MP3 files may only be
streamed, not downloaded, although the program cannot stop users from
copying songs in some other formats.
"We try to limit the opportunities for people to use our technology in
ways that might put us in legal hot water," Felser said. He added that
as the technological and legal environment changed, Grouper would do
whatever it was required to do to stay on the right side of the law.
What the company does not want to do, he said, is monitor or control
what users do with its software.
"It's a friends' network. We shouldn't be involved at all in what
they're sharing," he said.
A spin through the directory reveals a number of groups with seemingly
innocuous titles along with several others with eyebrow-raising
descriptions, including ones devoted to sharing episodes of the "Lost"
and "Veronica Mars" TV programs and bootlegged DVDs.
"Any swapping of copyrighted materials on the Internet is a cause for
concern," said Kori Bernards, a spokeswoman for the Motion Picture
Assn. of America. "We hope Grouper will adapt its program to prevent
the unauthorized distribution of copyrighted material."
A spokesman for the Recording Industry Assn. of America declined to comment.
One Grouper backer is Strauss Zelnick, a former top executive in the
music and movie industries who now is a partner in Zelnick Media, a
wide-ranging media and advertising company. To Zelnick, Grouper
promotes "fair use" of media by limiting the size of groups and
enabling streaming, not downloading, of MP3s.
"Fair use is beneficial to the record companies, I think," Zelnick
said. "Sampling is what music marketing is all about."
Still, Zelnick said the same was not true for movies because one
viewing might be enough for most people. "When you share a movie,
you've kind of stolen the intellectual property," he said.
Although the courts have yet to rule on the issue, several
copyright-law experts said there was little difference legally between
file-sharing with large groups or small ones.
"There's no family-and-friends exception in copyright law," said
attorney Robert Schwartz of O'Melveny & Myers, a Los Angeles firm that
has several entertainment-industry clients.
"Every time you make a copy, technically it's a copyright law
violation," said attorney Mark Radcliffe, a copyright expert at DLA
Piper Rudnick Gray Cary in Palo Alto. "But for a long time, there's
kind of been an unspoken agreement that if you make copies for your
friends, people weren't going to go after you. There's been an
argument that that might be a fair use in some way?. The whole issue
of private copying is a big challenge to American copyright law."
Urban of USC said Grouper appeared to have been designed to fit into
several exemptions that copyright law provides for nonprofit or
educational uses. "They really have mined the Copyright Act for all
the opportunities for sharing digital files," she said.
To Urban, though, the most compelling thing about Grouper has nothing
to do with copyright infringement.
"I want to see my nephew crawl," she said. "That's non-profit-infringing."
(c) Copyright 2005 Los Angeles Times
(In accordance with Title 17 U.S.C. Section 107, this material is
distributed without profit to those who have expressed a prior
interest in receiving the included information for research and
educational purposes.)
--
Joseph Lorenzo Hall
UC Berkeley, SIMS PhD Student
<http://pobox.com/~joehall/>
blog: <http://pobox.com/~joehall/nqb2/>
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