Tag Archives: internet

DMLA Signs on to Letter to Ambassador Lighthizer re: NAFTA

August 16, 2017

Dear Ambassador Lighthizer,

The undersigned groups represent the interests of a diverse group of small and medium businesses (SMEs) and individual creators in the creative fields. What unites us is a reliance on meaningful and effective copyright laws. Together, the core copyright industries contribute over $1.2 trillion to U.S. GDP, employ 5.5 million workers, and contribute a positive trade balance—and SMEs and individual creators make up a significant part of these industries.

The internet’s global reach has made copyright protections and enforcement increasingly important to free trade agreements. The small and medium businesses we represent are often on the forefront of exploring new models for making creative works available on a global scale. Widespread copyright infringement and unduly broad limitations to copyright protection distort overseas markets and undermine the ability of our members to successfully and fairly engage in commerce.

The effort to renegotiate NAFTA provides an opportunity to modernize the copyright provisions of the agreement for the digital age and establish a template for future agreements. We urge you to look beyond the failed Trans-Pacific Partnership (TPP) and to seek the highest standard of protection for businesses and creators that rely on strong copyright to compete successfully overseas.

Specific priorities for small and medium enterprises, as well as individual creators, include the following:

Strong and meaningful copyright protection and enforcement. The agreement should recognize the full scope of copyright rights, including making available, and remedies such as injunctive relief and statutory damages.

Effective enforcement provisions. Trade agreements are critical to fostering legitimate online marketplaces. A modernized NAFTA should respond to the challenges facing creators by including provisions to ensure effective enforcement and requiring legal protections for technological protection measures and rights management information.

Appropriate limitations and exceptions. NAFTA should reinforce the “three step” test for limitations and exceptions that has been the international standard for decades. The three-step test strikes the appropriate balance in copyright, and any language mandating broader exceptions and limitations only serves as a vehicle to introduce uncertainty into copyright law, distort markets and weaken the rights of the small and medium businesses and creators we represent. For that reason, we strongly urge USTR to not include “balance” language similar to what appeared in the TPP or any reference to vague, open-ended limitations.

Incentives for service providers to cooperate with copyright owners in addressing online infringement. Few SMEs have the means to devote resources to policing online infringement, and we therefore rely on service providers taking reasonable steps to minimize piracy that occurs on their platforms. To promote incentives for service providers to cooperate with copyright owners to address online infringement, the copyright provisions in NAFTA should establish appropriate standards for intermediary liability as well as appropriate safe harbor protections for intermediaries. We urge negotiators to provide for safe harbor protections in broader terms than how they’ve appeared in recent trade agreements. Congress and the U.S. Copyright Office are currently reviewing U.S. copyright law, and we want to make sure lawmakers have the flexibility to address shortcomings in domestic safe harbor provisions.

We thank you for your consideration of our priorities and look forward to working with you further as negotiations progress.

Sincerely,

American Association of Independent Music
American Photographic Artists
American Society of Journalists and Authors
American Society of Media Photographers
Artists Rights Society
Association of Independent Music Publishers
Authors Guild
Church Music Publishers’ Association – Action Fund
Digital Media Licensing Association
Graphic Artists Guild
Nashville Songwriters Association International
National Press Photographers Association
Recording Academy
SAG-AFTRA
Society of Children’s Book Writers and Illustrators
Songwriters Guild of America
Songwriters of North America
Textbook & Academic Authors Association
Western Writers of America

“I Discipline Google”

In response to Mathias Döpfner’s letter in the Frankfurter Allgemeine Zeitung (http://blog.pacaoffice.org/?p=1904), Joaquin Almunia, Vice-President of the European Commission and Commissioner responsible for competition, retorts some of the allegations as the Google anti-trust investigation continues to heat up.

“It is not true that the European Commission lets Google continue its abusive business practices. Under the Commission’s pressure, Google has made concessions, which – should they become legally binding – will significantly hit the corporation’s monopolistic practice.”

By Joaquín Almunia

Dear Mr Döpfner,

In your open letter to Eric Schmidt, Google’s CEO, published on April 16 in the , you made some comments directed explicitly at the European Commission and myself. Basically, you accuse the Commission of not acting against Google’s abuse of its dominant position in the online search market. I do not agree with you and in the following, I will explain why.

Let me first remind you of the facts. In November 2010, the Commission decided, upon my suggestion, to initiate an anti-trust investigation against Google. After thorough examination, especially after having analyzed a great number of formal complaints, I expressed serious concerns with regard to several of Google’s business practices. One of them is Google’s prominent display of its own specialized (or “vertical”) online search services within its normal search results without the user being informed about this kind of privileged display. It is indeed true that such methods may serve to unlawfully redirect Internet traffic towards Google’s services and are capable of discriminating against services of competitors, which might be equally or even more relevant to the user.

In the interest of all users, the Commission questioned Google’s methods and asked the company’s executives to propose concrete solutions in order to prevent malpractice. After long and difficult negotiations, Google finally granted us substantial concessions. In a few months, the Commission has to decide if these propositions become legally binding or not. In case the Commission accepts Google’s proposal, effective competition will be restored and users can make qualified decisions when they use the company’s search engine.

Accepting the proposals would in fact result in three major changes. Firstly, users would be informed about which links exactly are marketed by Google and are not generated by the normal search. Secondly, a distinct separation between Google’s specialized services and the standard search results on Google’s website would be introduced. Thirdly, Google would, when presenting its own services, present the specialized services of three competitors in a way that makes them clearly visible for the user. These competing links would additionally be presented in a comparable visual format.

In your open letter you describe these concessions as if ‘a new window for advertisements was installed at the top of the search result list’, which allows Googles to make some ‘additional income’. This interpretation is completely wrong. The proposed measures provide for that the links of three competitors are presented whenever Google is marketing its own services. If merchants don’t have to pay for being displayed (e.g. restaurants in Google Local), then competitors wouldn’t have to pay for that either. The three competitors would simply be chosen on the basis of their ranking in the ‘normal’ search results. In other cases, Google asks merchants for fees in order to be displayed in the specialized services, e.g. the price-comparing service Google Shopping. According to the proposed measures, Google would in these cases be forced to give up a significant part of the space they’re currently using to market their own services. This means that whenever Google decides to offer a – as you would call it – ‘new window for advertisement’, they would be forced to share the space with their competitors and allocate a comparable space to them.

Since Google would normally be generating income by charging merchants for that space, competitors would now have to pay likewise to be displayed in that space, according to Google’s proposal. To be picked, Google’s competitors would have to bid against each other at an auction to which only providers of specialized services are admitted. Instead of selling the space to their customers, Google would have to offer it to competitors. This would therefore not generate any ‘additional income’ for Google.

Furthermore, you purport that users won’t always find the result ‘that’s the most important and best, but the most profitable for Google’. The proposed measures achieve exactly the opposite result. Whenever Google is marketing their own specialized services and is displaying them in an accentuated manner – as it is the case today – the proposal would oblige Google to display the links of three competitors clearly visible and in a comparable visual format. This would give users a real option of choosing between different alternatives. Today, the privileged commercialization of its own products by Google has as the consequence that consumers don’t necessarily perceive the competitors’ products, since they are not part of the best search results and not listed at those spots that costumers look at the most. The proposals would therefore give competitors a direct possibility of attracting online traffic and hence protecting incentives to innovation in specialized search. It would then be up to the users to decide which service he prefers.

On a general basis, there seems to be a fundamental misunderstanding that I am pleased to clear up. Article 102 of the contract forbids the misuse of dominant market positions. What is forbidden is the misuse – but not the simple existence – of a dominant market position. The Commission is not allowed to require from a company that it gives in to any requirement by his competitors only because the company has a dominant market position. It is our role to fight against misuse of market power in the interest of consumers, but not in the interest of the competitors. The discretionary power by the Commission in this field is not unlimited. If we require from a company that it changes its behavior, we do so on the basis of an investigation and well-founded concerns regarding competition law that have to comply with strict legal standard and are always subject to the control by the European Courts.

The Commission has analyzed all the claims that it has received. It is important to stress that when there are situations that can be considered as questionable from an antitrust point of view, the Commission cannot request remedial actions that go beyond the necessary steps to resolve the concerns. We cannot dictate Google how it has to design its website. If we would request that Google presents its own specialized services in the exact same way as the services of competitors, this would mean that depending on the algorithm, Google services would not even appear on their own page. This would represent a restriction by an antitrust authority that has never been seen before.

It is not our role to keep Google from introducing innovation and trying to meet the needs of customers by developing and offering new services. This would not be in the user’s best interest. Our role is to ensure that Google does not prevent competitors to do the same. In other words, the role of competition policy in this case is to prevent that Google’s competitors are being restricted from effectively participating in the competition because of the preference that Google gives to its own services. The reason for this is that less competition can negatively affect consumer choices and incentives for innovation by competitors. I would like to reiterate that once alternatives are being presented to users, competition should take place based on the quality of the different services available, and it is then up to the users to click on the option that they prefer. The appearance of competitors’ links in a similar visual format would give Google’s competitors a real opportunity to direct these users to their services.

Furthermore, you claim that “Google could elude any commitments” by simply redirecting users from an Internet address towards an app. I absolutely disagree with that, too. The proposals we have obtained from Google contain all the measures necessary to prevent this from happening. The obligations would not only apply to queries at Internet addresses but also for Google’s Android apps. Moreover, if the Commission decides to declare the proposals legally binding for Google, an independent trustee will ensure that Google duly implements its obligations. As you know, companies that do not comply with the Commission’s anti-trust decisions risk high monetary penalties. In the past few years, non-compliance with two of the Commission’s anti-trust decisions has cost Microsoft fines three times higher than those for the abuse of its dominant market position itself. By the way, one of those decisions was based on commitments the Commission has made legally binding.

In conclusion, please allow me to comment on the particular concerns expressed by news media. I can perfectly understand that the utilization of press articles by European editors within Google News gives rise to concerns. From an anti-trust perspective, the problem consists in Google’s ability to use its market power in the general online search for obtaining content created by others and for integrating this into its specialized search services, including Google News. This is why the commitments we have obtained would allow press editors to prevent Google from showing their content fully or partially in Google News, without such a prohibition having negative effects on their website’s ranking within Google’s general search results. However, copyright issues surfacing in this context need solutions that lie beyond the scope of competition law. The same holds true for questions regarding the protection of personal data. In both cases, rules sanctioning the abuse of a dominant market position cannot substitute appropriate guidelines or regulation measures. Finally, I would like to add that compliance with anti-trust rules is a necessary prerequisite but by far not the only instrument to ensure the well-being of Europe’s digital sector.

Regarding issues that do indeed fall in the realm of competition law, the European Commission will keep a watchful eye on Google’s business conduct. The complainants in the current case will soon get the possibility of laying out their points of view on Google’s settlement proposal as well as to our arguments why we consider these proposals sufficient for addressing our concerns regarding parts of Google’s business conduct in the online search and online advertising market. If the European Commission accepts the proposal at the end of this process, they will become legally binding for Google. It would mean that important aspects of Google’s activities would be effectively regulated for the coming years. Unrelated to the current proceedings, Google’s very high market share and its role as a de-facto gate keeper of the Internet will also mean that the European Commission will continue to keep a close eye on Google’s business practices. This oversight is crucial in a fast moving market, in which problems can arise in a short period of time. And in fact we are already in the process of investigating concerns regarding the Android operating system, even though this investigation is still in a preliminary phase.

There is no question that Google’s market dominance poses a number of challenges for our economy and our society. These challenges span from the way the Android ecosystem functions to the collection and use of enormous amounts of personal data to the usage of third-party content, to the respect for intellectual property, and to tax tactics, to name a few. All of these issues deserve to be looked at with the same intensity by the authorities, and each one of the issues should be addressed with the right political tools. The current competition case against Google is only a part of the puzzle. But it is a part which could solve the specific competition concerns as quickly as possible.

Kind regards,

Joaquìn Almunia

Alex Springer Afraid of Google?

The New York Times reported, “A trans-Atlantic war of words — and profits — over the future of the Internet heated up on Wednesday when the head of Germany’s largest publisher, Alex Springer,  admitted that ‘we are afraid of Google’ and suggested that European authorities were colluding with the American Internet giant to develop a ‘business model that in less honorable circles would be called extortion.’” 

Döpfner penned the piece in response to an article by Google Executive Chairman Eric Schmidt, who defended Google’s practices and pointed to “heavy-handed regulation” in some places. Döpfner wrote, “We are afraid of Google… I must say this so clearly and honestly since scarcely one of my colleagues dares to do this publicly. And as the biggest of the small fry, we must perhaps be the first to speak plainly in this debate.”

In the piece, he commented on the European Commission’s antitrust investigation into the company. The New York Times reported, “Attacking what Mr. Schmidt had characterized as Google’s willingness to forge a compromise with the European Commission over a four-year-old complaint about its practices, Mr. Döpfner starkly declared, ‘This is not a compromise.’” In the letter, he asked, “Will European politicians fold or wake up? Institutions in Brussels have never been as important as they are now.”

Google did not respond to a request for comment. For the full article, please see http://www.faz.net/aktuell/feuilleton/debatten/mathias-doepfner-s-open-letter-to-eric-schmidt-12900860.html

Is Google close to settling EU antitrust probe?

Googlelogo

Pursuant to an article today in Reuters, they suggest that the EU Commission and Google have reached an agreement to settle a 3 year European antitrust probe that allays concerns over blocking rivals from internet search results and avoids a potential fine of $5 billion dollars. A decision is expected in the next few days…READ THE ARTICLE HERE

Uniloc and Patent Trolling

By Nancy Wolff, Esq., PACA Counsel

At the PACA 2013 Conference this October, we held a panel on patent trolls that are targeting this industry, and in particular, the Company Uniloc that alleges to have a patent on licensing images online and had targeted 4 companies in the micro stock space. Patent trolls are companies that purchase patents for the sole purpose of bringing claims against third parties. These cases are almost always brought in the Eastern District if Texas, which is a favorable jurisdiction for plaintiffs. Patent litigation is extremely expensive, and many companies will settle just to avoid costs. Many of these patent trolls acquire business method patents, which unlike inventions, merely describe a system for doing business and can be quite vague and overly broad. In the early days of the internet, many of these patents were issued as examiners did not have access to information regarding prior art in many industries.

On the  panel was Tamany Bentz, patent attorney from Venable, who represented Dreamstime, as well as Ellen Boughn,  who worked as an expert to provide information to the attorneys as to early online business practices in the industry. With  patent cases, you can attempt to invalidate a patent if you can establish prior art. Other defenses include showing how your process is different from the one described in the patent. (Dreamstime in fact settled with the plaintiff but Ellen’s report was apparently used by the other defendants. As noted below, those cases were dismissed with prejudice before any judicial ruling on the patent claim.)

The initial claims were brought against the following companies:

Former Defendants:
Dreamstime — settled
Inmagine — dismissed
RevoStock — dismissed
Depositphotos — dismissed

During the panel discussion,  it was recommended that PACA help be a source if business information, and that if other claims are brought by Uniloc or others, the industry collaborate together in order to defeat these claims. Since the meeting Uniloc has filed new patent claims in Texas against a numbers of other companies, listed below.

Getty, Corbis, iStockPhoto LP, Age Fotostock America Inc., SS SPV LLC, Envato PTY Ltd., Fotolia LLC., PhotoShelter, Inc., Photo Stock Plus, and VectorStock Media Limited

It may be helpful the join forces and share as much information as we are able to publicly, to discourage these claims.  PACA is willing to be the central point for collecting information.

Tamany has agreed to speak to any PACA member and can be reached below. We will continue to update members as we learn more about these filings.

Tamany Vinson Bentz, Esq.
Venable LLP
t 310.229.9905
f 310.229.9901
2049 Century Park East, Suite 2100
Los Angeles, CA 90067

Eye tracking study confirms that Google benefits most from its proposed ‘rival links’ solution to EU abuse concerns

PACA is pleased to be a new member of ICOMP

An eye tracking study, commissioned by ICOMP (Initiative for a Competitive Online Marketplace) has revealed that Google’s proposed commitments relating to the display of rival links, continue to weigh heavily in favour of Google’s own services and will not help rivals to compete against the company. The European Commission, following nearly five years of complaints from a wide range of European businesses and consumer groups, has expressed concern that Google is abusing its dominant position in Internet Search, to direct consumers to its own sites – rather than those which are the ‘best result’ for a search query.

In response to these charges Google has been asked to propose remedies that will stop this abuse and prevent it happening in future. However, Google’s second attempt at providing a workable, fair and effective solution (the first was rejected by the commission and online stakeholders in July) appears not only to fail in halting the abuse, but, as this research shows, actually makes the abuse worse.

The study, conducted by The Institute of Communication and Media Research (IKM) at the German Sports University Cologne (DSHS), examines where people look on the page of search results, how long they look at individual links and where they ‘click’ as a result. The search results pages used in the study were taken directly from Google’s proposals in its second round of commitments.

Key findings of the study are:

1.       Google’s ‘Sponsored’ results consistently attract the largest  amount  of  the users’ total  visual attention

2.       ‘Alternative  search sites’ do not draw enough visual attention to prompt the users to click on them

3.       Visual attention for organic links is negligible compared to the ‘image enhanced’ Google elements placed above them

For example; results for the search term ‘iPod’ reveal that thumbnail product pictures guide the visual attention of users to ‘Google  Shopping  Results’ with 56% of participants clicking into this area. While the ‘alternative search sites’ caught less visual attention and only clicked once, indicating little interest from users.

Similarly, examination of the ‘flight search’ results page revealed that most users clicked on the Google Flight Search ‘Sponsored links’ area (43%), with ‘alternative  search sites’ receiving little visual  attention  and  correspondingly, only  four clicks  (11%) indicating that the Google Flight Search area is the  most attractive on the search results page.

During a search for ‘Map London’, the Google Maps area and Google Images thumbnails receive more, earlier, and longer visual attention than all other page elements, including competing mapping providers, with 46% of participants clicking on the Google map and a further 36%  clicking ‘Google Images’, which is itself another Google service. Comparatively, the 1st organic link on the results page, ‘mylondonmap.com’, received only two clicks and the official ‘Transport for London’ , received no clicks.

ICOMP Legal Counsel, David Wood said: “These results give a clear signal  of  what  we can expect  from  Google’s  rival links proposal – an ineffective remedy and the potential for increased abusive behaviour by Google. Acceptance of these proposals by the Commission will serve to further and irrevocably entrench Google’s dominance. What is more, these new proposals give Google the power to further monetise its abusive behaviour by forcing small and large competitors to pay Google for the right to feature in these ‘rival links’ listings. The most relevant search results will be replaced by preferential slots either reserved for Google itself, or sold to the highest bidder. As ICOMP we maintain that the only workable solution to restore effective online competition and to give consumers what they are expecting is for all services to be given equal treatment in terms of search rankings placement. ICOMP urges the Commission to take note of these findings”

ICOMP Member and Managing Director of Hotmap.com, Michael Weber said: “The search results page layouts proposed to the Commission safeguard Google’s own paid product listings and other Google services such as Google Maps, giving Google the lion’s share of all views and clicks, and the proposed rival links next to none. In particular, this manipulation of search leaves mapping competitors with little traffic, in no way restores competition and is detrimental to the online economy.”

The value of eye tracking as a methodology is confirmed by Google’s own research methods. In its Official Blog of 6 February 2009, Google wrote “we use eye-tracking equipment in our usability labs. This lets us see how our study participants scan the search results page, and is the next best thing to actually being able to read their minds” The blog post confesses that “most users found what they were looking for among the first two results and they never needed to go further down the page”, demonstrating the company’s awareness of the power behind search results page positioning.

The ICOMP commissioned study was conducted by tracking the behaviour of 35 users when sat in front of a 46-inch  plasma screen  monitor, measuring  eye  movements  on search  engine result pages given as examples in the October 21, 2013 commitment  proposal  by Google, as well as an additional search results page depicting a mapping search. The study was conducted within time constraints, to allow for submission within the European Commission’s request for information deadline.

For further information, please contact the ICOMP Secretariat on Mary-Jane.Attafuah@bm.com or 0207 300 6205.