IP Blog

For those of you who ravenously devour the postings at IP Blog, and for those of you who only occasionally browse them, here is an important piece of news:

IP Blog is being folded into the Institute for Policy Innovation's new Policy Bytes blog, at www.policybytes.org.

Policy Bytes hasn't officially been announced as of the date of this blog post. It's still got a few design and function issues to be worked out before its official debut, but we wanted IP Blog friends (and enemies) to have as much notice as possible of the upcoming change.

The new Policy Bytes blog will allow IPI to blog on all of the various policy issues on which we focus, including technology policy, intellectual property, health care, tax policy, trade policy and development, and entitlement reform.

So, for a few weeks, we will be doing parallel postings at both Policy Bytes and IP Blog, but shortly thereafter we'll be leaving IP Blog up as an archive. But all of the current IP Blog postings and comments have already been transferred to Policy Bytes, so none of the interesting and compelling discussion that has happened here will be lost (although the links will obviously be changed).

Policy Bytes will feature blog postings from not only yours truly, but also from the entire spectrum of IPI policy experts. So postings should be much more frequent (and probably more intelligent) than have been occurring on IP Blog.

Policy Bytes will also feature regular audio and video podcasts of IPI commentary and policy events. But the Policy Bytes podcast feed is also available through the Apple iTunes site here.

IF YOUR INTERESTS ARE LIMITED TO INTELLECTUAL PROPERTY ISSUES, never fear. You won't have to sort through a bunch of blog posts that you don't care about. The intellectual property topic page of Policy Bytes is located here. And the RSS field for the intellectual property topic page is located here. And IP issues will continue to play a large role at Policy Bytes.

Each major topic area will have its own topic page and its own RSS feed. In fact, if your interests are sufficiently narrow, you can subscribe to a particular subtopic of a topic if you wish, such as WIPO issues. Or network neutrality, if that's your thing. As narrow as you want to be, or as broad as IPI goes, it's up to you.

Thanks for reading IP Blog, and I hope you'll take the time to check out a new and improved blog over at Policy Bytes.

This blog is built on a design by a great guy in the UK, Steve Castledine. Steve created this design to fill the need that users of Lotus Notes/Domino (such as IPI) had for a blogging system. There really wasn't a Lotus Domino method of blogging until Steve designed his. Steve has been a terrific supporter of his platform as well as a great designer of software.

Steve did such a great job that IBM hired him and acquired his blog design, and within the last few days IBM has released Steve's blog template along with the new release of Lotus Domino version 7.

Well, now that Domino 7 is out, Steve has had to go to some effort to explain to all of us who have been using his design for several years now that our existing blogs are incompatible with the new template from IBM.

Why? Read this document. IBM has stripped out several features that Steve built into his blog simply because they utilized open source code.

IBM has removed several features from Steve's original design, in some cases due to simplification, but in several cases simply because they utilized open source code.

Now, this is not a criticism of Steve, or of the Lotus Domino/Notes platform.

And it's not really a criticism of IBM, or of IBM's strategic use of open source. But it's a compelling illustration, I think, of the fact that IBM is only going to use open source where IBM deems it strategically useful for competitive purposes (i.e., to compete with Microsoft).

But to all the activists who are continually trumpeting about how IBM has embraced open source software, well, guys, it's not quite as ideological as you would like people to think. Most of IBM's code is proprietary, especially the stuff they think they can make money at, such as Websphere. If you really look at IBM's products, they are going with open source in those cases where they think they can't win the competition with Microsoft.

The fact is that IBM is always going to choose proprietary code unless they think somehow that, in a particular application, going open source gives them some competitive advantage. And they are going to dodge open source whenever they can, because open source development is apparently NOT as risk-free as the open source advocates would have us all think.

The fact is that Steve's template had open source code in it, and the features worked perfectly well, but IBM took them out and either left the features out or replaced them with proprietary code. And I think that's interesting.

Is it possible that open source code actually poses more risk to companies in some cases than does proprietary code? So they take it out if at all possible?

Washington Post

Broadcasting & Cable

New York Times

Hollywood Reporter

Washington Times

Arizona Republic

Business of Cinema (India)

BBC News

Gulf News (Dubai)

CBC News (Canada)

Video Business

Reuters

UPI

Playfuls (Romania)

MSNBC

NewsMax.com

Broadband Reports

Tech2 (India)

DailyIndia

More as of 10/2:

All Headline News

999Today (UK)

ag-IP-News (Jordan)

More as of 10/3:

TechWeb

Hollywood Reporter

World Screen News

IPI has gotten a lot of media coverage on our new econometric study estimating the economic impact of movie piracy, including a pretty good story in the Washington Post by Frank Ahrens.

One thing in the Post story demands to be answered, however. In response to our argument that money lost to piracy has a detrimental impact on the U.S. economy, Jason Schultz of the Electronic Frontier Foundation says something that on the surface seems really wise, but after further examination is really, really stupid.

Here is Schultz's quote:

It's important to remember, however, that even though piracy prevents money from reaching the movie industry, those dollars probably stay in the economy, one intellectual property expert said.

"In other words, let's say people are forgoing paying for $6 billion in movies by downloading or consuming illegal goods but end up spending that $6 billion on iPods, computers and HDTV sets on which to watch the movies, which leads to $25 billion in job creation in the computer/software/consumer electronics field," Jason Shultz, staff lawyer at the Electronic Frontier Foundation, wrote in an e-mail.

This is really, really, mind-bogglingly stupid.

There are several things I could say about the quote, but the most important thing to point out is that if people spend on other consumer electronics all the money they "save" by stealing movies, they are creating jobs IN SOUTH KOREA AND CHINA, not in the United States. The whole point here is that the movie industry is one of the very few industries where the U.S. has a positive balance of trade with the rest of the world (even with rampant piracy). The point of the study was the harmful impact of piracy on the U.S. ECONOMY.

Of course, Schultz identifies himself as a lawyer, and not an economist, so why he is trying to make an economic point and why Ahrens quotes him as if he has anything useful to say about economics is beyond me.

One of the fun things about our study is that we have described in detail in the study the data, the assumptions and methodology used. I can't wait to see how people are going to attack this study. I predict there will be a bunch of eye-rolling, foaming-at-the-mouth criticism from the IP skeptics, but will any sound economist attack the methodology or assumptions?

That's the fun thing about doing work with integrity and that is actually empirical in nature, as opposed to just putting out jargon and rhetoric. It's a lot tougher to knock down empirical work that was done with integrity than it is to just fulminate. So much of what the free culture, IP skeptic crowd does is just fulminate and make assertions. They have no empirical data or analysis behind any of their assertions ("knowledge wants to be free," "patents kill people," "DRM is keeping public domain away from the public," "intellectual property is being used to enclose knowledge"). That kind of rot.

I'd like to see James Boyle, or Lawrence Lessig, or Jamie Love come up with one single empirical study that proves any of their points. ANY of them.

It's a big day for piracy talk.

In addition to the U.S. Chamber's event on piracy and counterfeiting, today the Bush administration has released the

"2006 Report to the President and Congress on Coordination of Intellectual Property Enforcement and Protection". It's a 168-page Adobe Acrobat PDF file.

From the press release:

Highlights of the 2006 report include:

Working with U.S. Industry and Engaging our Trading Partners
The Bush Administration is expanding STOP! (Strategy Targeting Organized Piracy) education outreach events for small and medium-sized businesses, including China-focused programs.

The Administration is expanding the StopFakes.gov website and improving online resources for innovators and industry.

Bush Administration leadership led to the development and announcement of a G8 Statement on Combating IPR Piracy and Counterfeiting.

Leadership from the Administration led to the launch of the U.S.-EU Action Strategy for the Enforcement of Intellectual Property Rights.

The Commerce Department is continuing to expand its IP attaché program in China and positioning new regional attachés in Brazil, Russia, India, Thailand and the Middle East.

The Commerce Department and USTR are working to strengthen IP protection with Canada and Mexico as part of the Administration’s Security and Prosperity Partnership (SPP).

USTR is utilizing the Special 301 process and other trade tools, including World Trade organization (WTO) tools as appropriate, to seek resolution of U.S. concerns regarding IP protection and enforcement.

USTR is continuing its work to strengthen IPR laws and enforcement and forge an international alliance against counterfeiting and piracy.

The Commerce Department is expanding its education and capacity building programs through the Global IP Academy located at the USPTO.

As part of STOP!, the Commerce Department is promoting IPR protection at trade fairs. These efforts include educating trade fair organizers, exhibitors, and attendees about IPR; helping U.S. businesses guard against infringement at trade fairs; and promoting IPR protection at trade fairs and pavilions that Commerce operates, certifies, or supports.

The State Department has significantly expanded training of Embassy staffs in IPR issues to increase their effectiveness as first responders to U.S. industry.

And here's a story from Uganda, where musicians are desperately trying to organize themselves so that they can take action to fight piracy and obtain and enforce IP rights so that they can actually make a living through their creativity.

And no, the Creative Commons is not the answer. Nor is a treaty on "access to knowledge."

I reproduce the article below in case the link goes down.

New Vision (Kampala)
Sept. 26, 2006

Kampala

"WE are not playing. We want to make money and live well through music," Richard Kawesa said during a Music Forum Foundation (MFF) press meeting at Blue Africa Bar recently.

Kawesa, the MFF's president, said creative people are rich because their rights are protected unlike Ugandan artistes.

For long Ugandan recording artistes have had to do with poor payments for their creative brains.

Since July when several artistes met to address the anomaly, they have renewed their resolve to form a national music body that overseas the restructuring and regulating of local music with an objective of transforming it into a respectable and organised industry.

The meeting also featured an election where Travis Kazibwe was voted vice president; Dick Matovu secretary; Joanita Kawalya assistant secretary and Ragga Dee finance secretary. Other members are: Ras B assistant finance secretary; Tshaka Mayanja public relations officer, with Eddy Sendi and Halima Namakula as his assistants.

Now registered as a Ugandan NGO, MFF comprises recording artistes, instrumentalists, songwriters and music producers. MFF currently has a membership of 446 musicians countrywide and some industry stakeholders.

Kawesa said in their fight against music piracy, MFF has designed holograms that would be fixed on original CDs. CDs without such holograms will be rendered as pirated.

To support your artistes, buy original stuff from them.

It's true that piracy has a major harmful impact on the creative industries in the United States and Europe, but it's helpful to be reminded that piracy has perhaps an even more harmful impact in developing countries.

We don't downplay the impact of piracy on the U.S. and Europe; in fact, we're actively engaged in quantifying exactly how harmful this piracy is.

But piracy in the developing world can literally kill the creation and distribution of creative work. And no, the Creative Commons isn't the solution.

Here's a story from Burma, where creators are literally stopping creating. Domestic film production is dropping off, as is the recording and distribution of domestic Burmese music.

This is an Associated Press story from August 28, 2006. I reproduce it here in case the link goes down:

August 28: One of Burma’s most famous singers sees no point in producing a new album, and an accomplished movie director says it’s nearly impossible to put together financing for a film.

Such complaints are typical by Burma’s artists, who in addition to struggling against the military government’s tough rules, now face a threat to their livelihood in the thriving outdoor markets on Rangoon’s streets. In the makeshift stalls, plastic bins hold hundreds of pirated copies of locally produced movies, CDs and music videos-everything from Burmese rap and pop to comedies.

Customers get a choice. Legitimate DVDs and CDs displayed on rickety tables are priced at around 2,000 kyat (US $1.50), while pirated copies below the tables go for as low as 400 kyat ($0.30). Performers and producers say the stream of cheap, pirated performances-only interrupted by the occasional police crackdown-means artists earn no money.

“No one bothers to go to cinema halls,” complained San Shwe Maung, a director and producer who said that counterfeit versions of local films are hurting the domestic movie industry. “Without piracy we would get a portion of each sale, but because of the piracy we don’t get anything,” he told the Associated Press.

Producers’ frustration with piracy has led to a steady decline in film production, San Shwe Maung and others said. A half-dozen films have come out in the first six months of 2006, making it unlikely the annual production will match the 27 films produced in 2004, he said.

Few artists in Burma concern themselves with the losses that piracy inflicts on the big players like Hollywood and Microsoft. The struggling artists here are focused on the domestic ramifications and say the absence of intellectual property rights protection is slowly suffocating them.

“At the present … we only have a handful of albums released,” said Nwe Yin Win, one of the country’s most popular singers who has done everything from Willie Nelson covers to Burmese hip-hop. “Even I don’t dare to bring one out.”

“These pirates are doing better than the producers,” said Nwe Yin Win, best known by her stage name, Aunty Joyce. “I know certain producers who have changed their profession.”

Hip-hop artist Tha Soe said he’s given up trying to earn money from his music.

“I have six to eight CDs ready for production,” he recently told the Burmese-language Kumudra news weekly. “But I’ve decided not to do it for fear they’ll fall into the hands of pirates. I’ll put my songs on the Internet free of charge.”

It is illegal to make, sell and buy pirated goods in Burma. But legislation on copyright is a mishmash of laws, some dating back to Britain’s colonial rule. Experts say the laws need to be overhauled and modernized.

Those who work with the government concede that existing enforcement does little to stop criminals from producing illegal CDs and DVDs.

“They pirate the product within hours, as soon as it comes out,” said Myo Thant, an anti-piracy advocate and adviser on copyright issues to the Ministry of Information.

In November, the World Trade Organization delayed a new regulatory framework for the least developed nations which need protection for trademarks, copyright, patents and other intellectual property. The implementation of the Trade-Related Aspects of Intellectual Property Rights Agreement, known as TRIPS, was put off from 2006 until 2013.

It is now unclear if reforms will come anytime soon.

“I don’t know exactly when we will begin to implement these laws,” said Moe Moe Thwe, deputy director of the Ministry of Science and Technology, the agency responsible for overseeing the country’s new intellectual property laws.

Moe Moe Thwe said the central government has not given a timeline for their implementation.

One vendor on a crowded street said he had no option but to sell pirated movies. The man, who spoke on condition of anonymity for fear of being arrested, said he plays cat and mouse with police at least twice a week but continues selling pirated DVDs because the 10,000 kyat ($13) he earns a day is the “only way of earning money for my family.”

Soaring unemployment is just one of the common complaints in Burma, where the average income is about $1,700 a year. Citizens are struggling to cope with inflation, frequent electricity blackouts and a military government that continues to defy international pressure for democratic reforms.

Hla Htay, owner of Master Recording & Video Production, said music producers like himself want tougher regulations that will stop piracy from eating away at their profits. But Hla Htay, who produces about 10 of the 100 music and karaoke videos that Burma puts out yearly, said the producers had little real hope the rampant piracy will end soon.

We have commented in an earlier blog entry on the status of the Broadcast Treaty, and on the fact that the Treaty's language not only doesn't seem ready for prime time, but that it also contains some troublesome language regarding cultural diversity, access to knowledge, and mandatory limitations and exclusions that would become very problematic if they became standard template language for future agreements.

This morning the Broadcast Treaty came up on the agenda. At the end of everyone's interventions (more than 40), it was clear that pretty much everyone supports the idea of theTreaty, and most who spoke supported going to a diplomatic conference as scheduled in 2007, but several countries expressed concern that the language simply isn't in sufficient shape to move to a diplomatic conference.

The Chairman has asked for there to be informal consultations this afternoon on how to proceed.

"Informal consultations" means real negotiations. In informal consultations countries who actually care about the issue to speak freely off-the-record and free of the pressure that comes from speaking in the General Assembly on the record. In informal consultations is where the real horse-trading takes place, and it's also where vested interests state where they draw lines and what the deal-breakers are.

My guess is that there will be a proposal to have perhaps one additional Standing Committee meeting in the first half of next year, and to keep the scheduled diplomatic conference for the 2nd half of 2007. Otherwise, what will happen is for there to be 2 more Standing Committee meetings in 2007, and we'll go through this all over again next year and see if a diplomatic conference can be scheduled for 2008.

This Friday, September 29th, IPI will be releasing a new paper on the impact of global motion picture piracy on the U.S. economy.

This paper is truly unique, in that it goes beyond the losses due to piracy that are experienced by the motion picture industry itself, and estimates the impact of piracy on the total U.S. economy, including job losses, economic output, lost revenue to government, etc. This is the first time to our knowledge that this kind of economic analysis has been done.

Our paper uses the most recent estimates of the extent of global movie piracy, and uses an econometric model from the U.S. Bureau of Economic Analysis to determine the impact of movie piracy on upstream and downstream industries. It also conservatively estimates lost taxes paid to governments at all levels.

I'm not releasing the juicy details of the paper in this blog entry, since it is embargoed until Friday. The paper will be released at the U.S. Chamber of Commerce's Third Annual Anti-Counterfeiting and Piracy Summit, in Washington DC.

If you would like to attend the release press conference, send an email to soniab at ipi.org, and she'll get you the details. Electronic versions of the paper will also be available on the IPI website (www.ipi.org) Friday afternoon.

I'm proud to announce the release of a new book by IPI, entitled Overdose: How Excessive Government Regulation Stifles Pharmaceutical Innovation.

The author is our good friend and legal genius Richard A. Epstein. The book is published by Yale University Press, but it says "An Institute for Policy Innovation Book" in large, friendly letters on the title page and jacket. The actual release date is October 15, but we have copies on hand, and you can order it on Amazon.com.

The book began back in 2004 as an idea for a paper. We approached Richard wanting him to write a monograph for IPI on some specific issues related to proposed alternative models for pharmaceutical R&D. But it turns out that Richard had been carrying around in his head a number of topics related to pharmaceutical innovation, and our idea for the paper was simply the event that triggered a torrent of good stuff from Richard's incredibly productive and creative mind.

That material ended up in the book as Chapter 10, "Socialization of R&D." But there are 17 other chapters that should be of interest to anyone who is interested in the process of pharmaceutical innovation, and in particular of the many ways in which government regulations make it more difficult than it should be to discover new molecules and bring them to market in a cost-effective way.

Richard's conclusion is that we need fewer, rather than more, government controls on the process of pharmaceutical innovation if we want this industry to keep producing the cures and treatments that we have come to expect.

We hope this book will become an important text in the health economics field, and will influence a generation of students, health care experts, and economists.

We were grateful that Yale University Press found the manuscript compelling, and we're looking forward to working with Yale on the promotion of the book, and perhaps on future book projects as well. Book release events are being scheduled for New York City and Washington DC, and perhaps some other places as well.

I'm walking around Geneva this week with 2-3 copies in my bag, so you can hit me up for one of those if you're here. Otherwise, you can get a copy from Amazon. Alternatively, for a million dollar contribution to IPI I'll personally deliver a signed copy to your door (or to anywhere else, for that matter).

This is the intervention delivered by IPI at the World Intellectual Property Organization's (WIPO) 2006 General Assembly:

Thank you, Mr. Chairman.

The Institute for Policy Innovation is a 19 year old economic research institute, and a civil society NGO at WIPO. We focus our research and advocacy on issues related to economic growth. We believe that economic growth is the solution to many of our public policy problems. Economic growth facilitates better education, better health care, and protection of human rights. Conversely, it is almost impossible to advance in education, health care and human rights without economic growth.

In general, economic growth comes through participation in markets, and markets do not function without property rights. Property rights are thus essential to the economic growth equation.

Because property rights create markets, property rights facilitate rational methods for distributing goods. Today, we are even dealing with problems of pollution by creating property rights for pollution and carbon emissions. More often than not, property rights are the solution, rather than the cause, of problems and inequalities.

Our interest in intellectual property is driven by the well-known relationship between intellectual property and economic growth. This relationship is recognized by the vast majority of economists and academics, despite the fact that it has recently become popular among some groups to question the significance of intellectual property as a driver of economic growth.

We also believe that the right to own and benefit from one's own creations and inventions is a basic human right, as specifically stated in the Universal Declaration of Human Rights.

Since intellectual property is so important, a functioning WIPO is also important. We thus view new proposals at WIPO through the lens of whether or not they will enhance intellectual property protection (and thus economic growth), and whether they will result in a more or less functional WIPO.

Development Agenda
On the proposed development agenda, IPI participated in all meetings related to the proposed Development Agenda during 2005 and 2006. We heard all of the interventions, read all the documents, and observed the effort made by the Chairman to put together a document that reflected the proposals that had gained sufficient support to move forward. For some reason, the Chairman's approach did not gain consensus among some who seemed to believe that the only acceptable consensus was consensus on their own proposals.

We believe that, if the proposed development agenda is to proceed at all, its best chance of success is to proceed from the Chairman's excellent document, which was introduced on the last day of the PCDA process, and is included in the report that was submitted to the General Assembly.

In order to get anything useful done, we must not let the "perfect become the enemy of the good." The PCDA Chairman's draft may not please everyone, but it certainly represents a step in the desired direction.

Broadcast Treaty
It is widely recognized that broadcast signal piracy is a problem, and will become a larger problem in the future. IPI believes that a treaty dealing with signal piracy would be an important step for WIPO, and would have a beneficial economic impact.

We therefore urge the member states to find a way to move forward with a treaty to protect the rights of broadcasters.

We appreciate the opportunity to participate in WIPO deliberations, and we appreciate the opportunity to present this intervention.

We also would like to offer our thanks to Mr. Geoffrey Yu, and also to my fellow native of the state of South Carolina, Ms. Rita Hayes for their years of service to WIPO.

There are a number of objections to the proposed Broadcast Treaty at WIPO.

The first group of objections comes from a group of radical activists who either don't believe in property rights at all, don't believe in intellectual property rights, only believe in particular kinds of intellectual property that they themselves have invented, or who believe that anything corporations do is evil.

I discount their objections, as you might guess. They are illegitimate.

The second group of objections comes from those who believe in intellectual property, but who think that there is great danger in "too much" IP rights, and thus are uncomfortable with creating new rights, which the Broadcast Treaty would do.

That's a legitimate debate to have, but it's not really this objection that is threatening the Broadcast Treaty.

A third group of objections comes from strong supporters of intellectual property. These are the objections that seem about to kill the Broadcast Treaty. And since they come from people who otherwise strongly support intellectual property, they are obviously important and worthy of discussion.

There are also objections to the Treaty that are coming largely from U.S. telecom and cellular companies. I THINK I know what their real objection is, but it's not really stated in the published objections they have circulated.

"Poison pill language"
But the objections from pro-IP forces have to do with language that is in the current draft of the Treaty, which contains just about all language that anyone wanted in the Treaty. There was an attempt by the Chairman to come up with text for the Treaty which reflected only that which was widely supported, but that attempt was immediately shot down. Everyone wanted their particular language in the Treaty. So what we have now is a draft that is "inclusive" in nature, which means it includes everything but the kitchen sink.

Some of this language is very problematic. There is language on mandatory limitations and exclusions, which is a really bad idea not only in this Treaty, but also in that it could become a template for every other treaty.

There is also language on cultural diversity, including a specific link to the Convention on Cultural Diversity. This is also problematic, for the same reason.

So we have a Treaty which attempts to address something most observers think genuinely needs protection, namely signal piracy. But it has "poison pill" language in it. Language that is really intolerable, and would pose significant future problems if it infected everything else.

What to do?
The question is, what do you do in a situation like this? Because the current reality is that this kind of language is ALWAYS going to come up in ANYTHING done in a multilateral body. This is the current state of play in the world. There are blocks of nations that are always going to insist that this kind of language be in any international agreement.

And this is the job of negotiation. If something is worth doing, negotiators find a way to get it done.

So one option is to continue to try and finesse and negotiate this language. Move it to the preamble, where it has no real impact. Tweak it so that it has no force of law. Trade it for something else. Negotiate, in other words.

The other option is to quietly walk away, deciding that whatever benefit would be gained from the Treaty is not worth the risk. This is what is apparently going to happen, and I'm not saying that's necessarily the wrong thing to do. It might be the right thing to do in this particular case.

But it seems to me that, if the Broadcast Treaty dies because countries were able to insist on harmful, poison pill language that was intolerable to the U.S. and to other industrialized nations, one has to ask whether WIPO is any longer a functioning organization. There's more important work to be done internationally on IP. I have wonder: If it is so easy for to sink the Broadcast Treaty with poison pill language, will WIPO ever be able to do anything from here on out?

If not, the bad guys have won. My theory behind the Development Agenda has always been that the true intention is to tie up WIPO in order to use it as a bargaining chip in WTO negotiations on agriculture subsidies. If WIPO can't get a treaty done that it has been working on for 8 years because we can't get rid of some language we don't like, I'd say WIPO is already tied up even without the Development Agenda. And that means an end to other important things on the IP agenda, like patent harmonization.

There is one other possibility. It may be that nothing is going to move in any international forum until the agriculture subsidy issues are settled within the trade space. So perhaps it's a matter of waiting until the international environment is more favorable, though of course there are opportunity costs related to waiting.

It's always been the case that the main driver behind the free and open source software movement was animosity against ownership, control, and profit. That's why Richard Stallman came up with the idea, and it's why most of the early open source programmers got involved in open source projects in the first case. Most of them did what they did out of a sense of doing something clever and somewhat anarchical.

But somewhere along the way open source software became a very reasonable and practical solution in a number of niche business applications, and so the ideological Trojan horse of free and open source software was adopted by the pragmatic business community.

This, of course, was highly resented by the ideological revolutionaries behind free and open source software. They never intended for their invention to work side-by-side with the hated proprietary software. Hence, the license had to be "upgraded" in order to continue the revolution and forceably enlist the pragmatic business users of free and open source software in the ideological struggle, and to further undermine ownership and control.

The result is GPLv3, which very clearly goes beyond what is necessary in a software licensing scheme, and contains provisions designed to undermine digital rights management (DRM). This is utterly irrelevant to software development, but is vital to advancing the ideological campaign of the founders of free and open source software.

Similarly, new elements of the GPLv3 are designed to poison the intellectual property of anything touched by GPLv3 software.

Again, this is by philosophical design.  It's entirely reflective of the philosophy of those who are behind the movement.

But finally, and refreshingly, the pragmatists have pushed back against the philosophical wackos. More than two dozen of the most prominent Linux programmers have signed a letter rejecting the GPLv3, and precisely for the reasons I mentioned above. Here is an excerpt from the article cited above:

• DRM: "While we find the use of DRM by media companies in their attempts to reach into user-owned devices to control content deeply disturbing, our belief in the essential freedoms (in Linux programming) forbids us from ever accepting any license which contains end-use restrictions...The FSF's attempts at drafting and re-drafting these provisions have shown them to be a nasty minefield which keeps ensnaring innocent and beneficial uses of encryption and DRM technologies....Defining what constitutes DRM abuse is essentially political in nature and as such, while we may argue forcefully for our political opinions, we may not suborn or coerce others to go along with them."
• Patents: "As drafted, this currently looks like it would potentially jeopardize the entire patent portfolio of a company simply by the act of placing a GPLv3-licensed program on their Web site. Since the Linux software ecosystem relies on these type of contributions from companies who have lawyers who will take the broadest possible interpretation when assessing liability, we find this clause unacceptable because of the chilling effect it will have on the necessary corporate input to our innovation stream."
• Additional restrictions that programmers may add to the GPL's terms: "The additional restrictions section in the current draft makes GPLv3 a pick-and-choose soup of possible restrictions which is going to be a nightmare for our (Linux) distributions to sort out legally and get right. Thus, it represents a significant and unacceptable retrograde step over GPLv2 and its no-additional-restrictions clause."

Seeing pragmatic users and practitioners of open source software standing up a bit against the ideologues is an encouraging development. We have always argued that, if open source is a valid method of development, it will succeed in the marketplace along side of the products of a more proprietary model. And if something succeeds in the marketplace, that's a fine thing. If something can compete, good for it, and good for the businesses who find it to be a useful part of their total IT package.

What we are opposed to are philosophical Socialists and Marxists masquerading as authors of software licenses, and trying to distribute their failed philosophy as a payload on a software license. So we're encouraged by this latest development.

Right now we're being lectured by Gilberto Gil, Brazil's Minister of Culture, popular musician, and commons radical. Here is a little background on Mr. Gil.  Here's some more. And here's a bit more, featuring a very funny anecdote at the bottom of the story.

Gil has just told us that the IP regime is so out of balance that it no longer functions as intended, but instead serves to stifle creativity and innovation. Jeez, I've never heard that before. I wonder where he got it? Oh, from Lessig and Barlow. That makes sense.

The Wired article cited above is all about how Brazil is showing such leadership on moving to the commons model. Brazil is all about open source, Creative Commons, Linux, etc. The Wired author is breathless with lust and admiration about how smart Brazil is, and how obvious this should be to all of us, and how dumb anyone is who doesn't follow Brazil's lead.

The one thing I keep remembering is that about the only thing Brazil has taught the rest of the world is how to keep screwing up their economy and failing to join the developed world despite almost unparalleled national resources and an educated workforce. The story of Brazil has been the government continually getting everything wrong, from economics to property rights to health policy.

Given their size and natural resources, Brazil (and Argentina) should lead the world, economically. So why have both countries spent the last 50 years or so in endless cycles of hyperinflation, debt, currency devaluation, property confiscation, etc.?

And why should the world look to Brazil, et. al. for leadership on IP? Isn't it more likely that, if the government of Brazil thinks it's a good idea, it's actually a terrible idea? I mean, given the 20th Century and everything?

Don't get me wrong, I have nothing against Brazil or Brazilians. In fact, I rather like many of them. My gripe is with a government that has an almost unbroken record of doing disservice to its citizens and failing to grow its economy, now lecturing the rest of us on how we're wrong on economics and property rights. Give me a break.

One interesting note: the anti-IP chavistas here at WIPO are gleeful at the prospects of the U.S. killing the Broadcast Treaty.

This is because they don't believe in property or property rights, and they believe corporations are inherently evil. So, duh, they oppose a treaty that protects the property rights of broadcasting organizations.

The irony, however, is that it's specifically language that reflects the beliefs of these activists that is the poison pill that threatens to kill the Treaty.

So, while they are happy that the Treaty is in danger, how fulfilling a thrill can it be knowing that it's your beliefs that are so repulsive that they threaten to bring down 8 years of work?

And, also, can someone tell me why the U.S. is working with these anti-IP chavistas  on the Broadcast Treaty, as opposed to running as fast as they can in the opposite direction?

Finally, why on earth have some U.S. corporations that I otherwise respect chosen to enlist these anti-IP radicals in their efforts to oppose the Broadcast Treaty? The radicals themselves are surprised. Here's an easy prediction: The companies will regret this alliance. These anti-capitalist, anti-IP NGOs are the enemies of business, of profits, of capitalism, of true innovation, and of property rights. You should wear garlic around your necks when you see them coming, not enlist them as allies in your coalitions. Because, like the scorpion and the fox, these guys will sting you the first time they get a chance without compunction, because that's what they do.

Of course, this works both ways. The IP skeptic NGOs should understand that they are simply being used by corporations to further the corporations' agenda. How's that feel, guys?

. . . but I'm in Geneva, Switzerland for the 42nd General Assemblies of the World Intellectual Property Organization (WIPO). This is the annual meeting where business is actually conducted and decisions are made, as opposed to other bodies which meet to discuss, debate, and make recommendations.

On the agenda this week are at least two very controversial items, both of which are slated to come up on Wednesday.

The first of these is the proposal for a WIPO Development Agenda, which I have covered extensively (and perhaps ad nauseam) on this blog. If you want to read about that, avail yourself of the blog search engine or the category index. I will of course cover developments on the proposed development agenda here this week.

By the way, I insist on referring to the development agenda as the "proposed" development agenda because that is the correct state of the issue. The question is WHETHER WIPO shall adopt a development agenda, and if so, what should it look like. I make this distinction because many of the proponents of the development agenda have always used language which suggests that a development agenda is a "done deal"--that there darn well is going to be a development agenda, and it is darn well going to be what we want it to be. But that is not the case. WIPO has never endorsed a development agenda. What WIPO has endorsed is a consideration of whether or not to implement a development agenda.

The second controversial item is the proposed Treaty for the Protection of the Rights of Broadcasting Organizations, or the Broadcast Treaty for short. I have not covered the Broadcast Treaty to a very great extent on this blog, but I plan to spend most of my efforts this week on the Broadcast Treaty.

I haven't taken a position on the Broadcast Treaty, but my thoughts on the Treaty will also be contained in later entries.

I'll explain the Treaty in a later entry, but for now, here is how things seem to be shaping up: Developing countries want the Treaty, and the U.S. wants the Treaty--no, wait, now the U.S. apparently does NOT want the Treaty.

The U.S. seems to be flipping its position on the Broadcast Treaty. From what I can tell, the U.S. delegation's concerns are legitimate, but could almost certainly be addressed through the process continuing, as opposed to the U.S. blowing up an 8-year process, which is the current rumor.

The U.S. concern seems to be some troubling language that is in the current draft of the Treaty, especially language on cultural diversity, including a specific link to the Convention on Cultural Diversity. Also, there is language that suggests mandatory exclusions and limitations, which is troublesome. The thought is that if this kind of language is in the Broadcast Treaty, it will become a template for all WIPO treaties and agreements, and will undermine the entire IP (or at least copyright) regime.

However, there is still opportunity to finesse the language of the Treaty, and in fact it's well understood that changes to the language will HAVE to be made, since right now the document consists of just about every bit of language that everyone wanted in the Treaty. As it stands, the language of the Treaty is obviously still in draft stage. So it seems to me that, if in fact creating these rights for broadcasters is a good thing, it's worth continuing to work on the language.

In fact, there is already a scheduled 2-day conference devoted to working through these specific language disagreements before the proposed diplomatic conference next year.

So, for me, right now the biggest issue of the General Assemblies is what the U.S. decides to do on the Broadcast Treaty. Does the U.S. value the protection of broadcast streams sufficiently to continue to work through the process, or has the U.S. decided to blow up the process by referring it back to a standing committee, which will likely be death to the Treaty?

I'll let you know.

On Wednesday in Geneva, WIPO's Standing Committee on Copyright and Related Rights (SCCR) approved a recommendation that the proposed "Treaty on the Protection of Broadcasting Organizations" move ahead to a diplomatic conference.

What that means is that proponents of the Broadcast Treaty won this latest battle. But there are more battles ahead for the Treaty.

First, the recommendation to proceed with a diplomatic conference must be approved by the General Assembly when it meets for its annual meeting the last week of September (yours truly will be there).

If that succeeds, the next thing will be the diplomatic conference where final language (and thus the Treaty itself) can be approved. Said conference would take place early in 2007 at a location yet to be decided.

Now, without commenting in this blog post on the merits of the Treaty itself, we must note that opponents of the Treaty were complaining that the process had not been fair. "There was no consensus" several opponents were complaining loudly and publically on Wednesday.

Now, everything at WIPO and at most UN organizations is based on "consensus." That means absolutely no voting. Just the suggestion of a vote is considered an insult to the diplomatic process. Nothing moves unless it reflects consensus.

But an important point of clarification is needed here. Consensus does NOT mean that everyone agreed. Consensus means that no one blocked. And that's a huge difference.

In other words, there was consensus and the recommendation moved forward because no member state said in a public intervention that "we cannot support a recommendation to move forward with a diplomatic conference."

If even a single delegation had blocked the recommendation of a diplomatic conference, it would not have moved forward. Just a single delegation.

So it doesn't really matter if some are unhappy about the treaty. Yes, the treaty is controversial. But WIPO is a member-nation organization, and not a single member nation blocked the diplomatic conference. So it proceeds to the next battle in 2 weeks.

My point here is that the Treaty may be controversial in some quarters, but apparently not among WIPO member states themselves.

Here's a good article on how India's adoption of strong IP protection is creating a culture of innovation.

The Indian IP scenario has undergone huge transformation over the last three decades. Though the IPR regime in the country is far weaker than desired, it's evolving and awareness among Indian enterprises is increasing. Now realizing the importance of patenting, companies are creating culture of innovation. For example, product companies like Ramco, TCS, Infosys, i-flex, Sasken, and Subex are nurturing and building strong IP cultures. Infosys, for instance, has been the leader in the pack with 20 filings in the last fiscal.

One of IPI's Senior Research Fellows, George Pieler, has a great commentary on CNET News today entitled "New Vistas for Microsoft, so why not Europe?"

George's point, that the EU's fines and regulations aimed at Microsoft not only make no sense but also are not even in the interests of European consumers.

In fact, there is a staggering statistic about how few copies of the EU-mandated stripped version of Windows have sold. I've heard the statistic, but I'm still hunting it down.

I found it. It's astonishing. Here's the fact sheet from Microsoft. Over 35.5 million copies of "full" Windows XP were sold in Europe during the period of comparison, but only 1,787 copies of "stripped" Windows XP N were sold, and many of those probably are sitting in warehouses rather than being purchased by consumers. No PC manufacturers in Europe have purchased or installed Windows XP N on their machines.

Here is commentary on the failure of Windows XP N on arstechnica

Oh, definitely, one can see how the EU is in touch with the desires and needs of European consumers.

The reality is that the EU is simply a willing and stupid pawn being used by Microsoft's competitors. Their greed, combined with the EU's economic stupidity, creates a hospitable forum for attacking the success of Microsoft, but has done absolutely nothing for EU consumers.