Tag Archives: unauthorized use

KodakOne Attempts to Prevent Unlicensed Use of Pictures

by Nancy E. Wolff and Kyle Brett.

On January 9th, Kodak announced its intention to enter the cryptocurrency craze by developing a blockchain-based service that presumably allow participating photographers to get paid each time their licensed work is used on the Internet without their prior consent. As described on the company’s website, the digital platform, currently referred to as KODAKOne, will “provide continual web crawling to monitor and protect the [intellectual property] of images registered in the KODAKOne system.” Upon detection of an unlicensed use, Kodak will manage the post-licensing process and (i) have the picture removed, or (ii) compensate the participating photographer in the company’s own currency, referred to as KodakCoin. By December 11th, the company’s stock had more than tripled.

While digital photo licensing is a concept as old as the first website, and entire businesses are built around assisting photographers in the collection of royalties, KODAKOne’s innovation seems to be in its attempt to leverage blockchain’s strengths against traditional photo licensing’s weaknesses in securing compensation for unauthorized online uses. For example, in order to be compensated for an unlicensed use of a photograph, a photographer (or its representative) would have to own the the copyright, detect an unlicensed use, contact the unlicensed user (if possible), engage in a discussion regarding compensation and agreeing on compensation, and wait to be compensated by the unlicensed user or initiate a DMCA process to have the unlicensed picture removed or bring a copyright action. Here, blockchain technology (a digital ledger in which transactions are recorded publically) allows the KODAKOne platform to automate all of the foregoing by simultaneously serving as a database of rights, detecting an unlicensed use across the entire Internet and seamlessly compensating a participating photographer in its ecosystem’s own currency. In addition, “accredited investors” can buy KodakCoins and purchase the rights to license a picture registered with KODAKOne.

That being said, there are several potential issues with Kodak’s premise, first of which is whether photographers will even want to be compensated in KodakCoins. Yet, according to a Kodak spokesperson, “KodakCoins can be exchanged for U.S. dollars and the exchange will be announced in the coming weeks.” So, provided that the margins of the exchange rate (even if not the best) are commercially reasonable, KODAKOne may provide a way for photographers to recoup some profits from unlicensed uses that would have otherwise provided none.

From here, it is not difficult to see where Kodak may hope its idea grows: if KODAKOne successfully manages, markets and monetizes the rights to digital pictures, Kodak may eventually attempt to add IP rights to digital videos and digital music on their platform, becoming an entire marketplace for digital art and entertainment. But, nonetheless, it is an idea fraught with historical failures: over the years, the music industry has wasted millions of dollars attempting to build a central music rights database, such as Global Database Repertoire (GRD). In GRD’s case, a collection of organizations attempted to build a joint database that, like KODAKONE, would have primarily allowed for a rights holder to (i) register their work once with GRD, instead of numerous times in different countries, (ii) track royalties and guarantee the rights holder was paid promptly and fairly, and (iii) initiate cease and desist actions against unauthorized users.  But, in 2014 and after more than 12 million dollars was spent developing the database, the effort to build GRD was abandoned as organizations pulled out over concerns regarding control and the potential loss of revenue from an efficient GRD. In Kodak’s case, and because the company will control the entire platform from the outset, KODAKOne may not be beleaguered by same set of problems that shelved GRD.

Yet, there are still remaining legal questions that must be answered before KODAKOne is declared an industry salve, and many industry experts are skeptical about Kodak’s entire endeavor, some suggesting it is at best doomed to fail and a worst a final trick from historically troubled company. A question, for example, is whether Kodak will request that unlicensed users pay for their infringement (as the mechanism to compensate participating photographers) and, if so, what will be the amount that Kodak requests an unlicensed user to pay? In current practice, depending on the copyright status of the picture at issue, the appropriate fee would either be the reasonable licensing fee or a multiplier of the licensing fee. If KODAKOne does not, at a minimum, collect a reasonable licensing fee, many photographers may choose to not register with the platform and instead to hire a third parties to crawl the Internet for unlicensed uses and negotiate for a much higher settlement. Another example of an outstanding legal question is what language the KODAKOne Terms and Conditions will have around “exclusivity”—that is, whether KODAKOne has an exclusive right to manage the rights of a given picture. If KODAKOne does have an exclusive right, the platform may indirectly create an incentive for photographers to not put their best work on the platform and, as of the result of that, buyers may be disincentived from using KODAKOne as a primary resource for licensable pictures.

Notwithstanding the many open questions, Kodak has taken a creative step forward for itself and the discussion of rights management has a further addition into the exciting cryptocurrency space. But, as with all new areas, right holders should consult a lawyer before participating.

Microsoft Responds to PACA’s Concerns

Recently, PACA sent a letter to Microsoft addressing the issues brought to our attention by Past President Rob Henson in regards to Microsoft’s Office web page “Images”.  We asked APA, ASMP, ASPP, GAG, NPPA and PPA to join our efforts.

On this webpage Microsoft prompted readers to use Bing to download images for whatever intended use they might have. Microsoft did not attempt to educate the user on copyright, use rights or even how unauthorized use of images pulled from the web might expose the user to risks.  See the entire blog here.

This week we received the following response from Microsoft:

Dear Ms. Aron:

My colleague Kate O’Sullivan asked me to contact you after receiving your letter regarding Microsoft’s Office user help page.

As you note, Microsoft has a deep respect for intellectual property rights, and a long history of working with many stock photo providers.  Microsoft frequently educates our users in plain language about copyright; see by example: http://www.microsoft.com/en-us/legal/Copyright/Default.aspx. This summer, we also implemented a feature within Bing image search that enables users to easily search and locate websites offering tens of millions of images freely available via the Creative Commons license model, and we educate users how they can legally use these Creative Commons images.

Accordingly, Microsoft believes the Office Help Webpage simply explains how our products work.  Nonetheless, as the Office Help Webpage referenced in your letter is now offline, these concerns appear moot .  We trust this resolves the issue.

Best Regards,
Dave Green
Assistant General Counsel
Copyrights & Trade Secrets Practice Group
Tel (425) 538-7325 | Cell (425) 260-9994 | Fax (425) 936-7329
Microsoft Legal and Corporate Affairs

We believe our concerns had something to do with the removal of this page!!

MICROSOFT’S 3-STEP PROCESS TO ONLINE THEFT

By Robert Henson, courtesy of Tall Firs Media, LLC

Microsoft, the world’s largest software maker and itself a massive consumer of image content for its products and services, has taken the bold step of promoting the theft of images online. Through its newly revamped Office product, Microsoft is replacing an image search functionality – one that routed the user to vetted sources for searching, transacting and integrating content into their online projects – with a general Bing search. While Microsoft is certainly free to remove one piece of Office functionality and push users onto the Bing platform, the methods of how it is doing so underscores a blatant disregard of intellectual property.

On Microsoft’s Office web page Images, it guides an Office user on the acquisition of images for use. Under “Use Bing to get images”, it outlines a three step process:

  1. Open Bing.com (and search for an image)
  2. Hover over your selected item…and Right click
  3. Click Save picture as…in the menu. Save image.

The message is clear: use Bing to download images for whatever intended use you might have. Microsoft does not attempt to educate the user on copyright, use rights or even how unauthorized use of images pulled from the web might expose the user to risks. It would seem that driving Bing traffic at the expense of content owners and generating volumes of orphaned works is far more important to Microsoft than architecting a solution where both parties might benefit from online search and use.

The unauthorized use of images has increased year over year, where it is now assumed that well over 85% of all images used online are done so illegally. Sites like Pinterest routinely expunge image metadata when users pin images, and despite attempts by Getty to monetize their collection by coupling Getty orphaned works with their rightful information, it’s a drop in the bucket considering the hundreds of millions – or billions – of images Pinterest hosts. Google is still the leader in generating orphaned works, and they’ve recently made greater strides in obfuscating information on the rightful owner of an image, while giving easier direct access of any online image from their search to users.

Microsoft, desperate to try and play catch up in the online search market, is brazenly throwing the content industry under the bus in the name of Bing. How it is educating the market on image use and consumption might very well be categorized as reckless, but more so ironic given that Microsoft is a corporation that vehemently defends its own intellectual property with extreme prejudice.

It’s not the lack of viable alternatives that accelerates unauthorized use, but lack of market education and general disinterest on behalf of search engines and social media platforms. What market education there is comes through the wellspring of Creative Commons, Electronic Frontier Foundation, and other entities that advocate for free and unfettered access to content, and are intent on rewriting the rules around content ownership and accessibility. Microsoft has joined in the chorus, with a clear full-throated voice.