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EU Copyright Directive and lessons from the Sony Betamax – Divij Joshi

By Divij Joshi

In the beginning, there was the Sony Betamax.

The grandfather of recording technologies, one of the first devices to allow home video recording on tapes, overcame significant legal hurdles to even get into the market. The Betamax was taken all the way to the US Supreme Court by movie studios, who argued that by selling a device which could result in users at home committing piracy (say, by making and selling copies of copyrighted movies), Sony was contributing to copyright infringement. Thankfully, the US Supreme Court rejected this claim, and held that the Betamax was capable of legal use, and the law could not stop the development of a technology because of the mere possibility of infringement.

Cut to the present, 35 years since the landmark judgement. The Internet has revolutionised the creation and access to knowledge and culture – from literary blogs to musical remixes or reusing classical art as memes – it has subverted traditional barriers to information and knowledge and spawned a new culture of access, sharing and creation. This has been helped by online content hosting services like YouTube or TikTok, which provide platforms where you and I can communicate our own creations without requiring traditional distribution channels like records labels, publishing houses or movie studios which place high barriers to access and sharing. We’ve come a long way since clunky videotapes – yet the dilemma faced in the Betamax case is still alive.

A recent law passed by the parliament of the European Union is perhaps the most significant new threat to this enabling culture of the internet. The new EU law, known as the ‘Directive on Copyright in the Digital Single Market’, does away with a long-standing rule that the Betamax decision first elaborated – that the use of new technologies should not be curtailed merely because they allow the possibility of copyright infringement, particularly if there are other legal and beneficial ways in which they can be put to use. Specifically, the EU directive subverts the concept of ‘intermediary safe harbour’, which holds that online platforms, or ‘intermediaries’, should not be liable for merely permitting users to upload and share content, unless they have specific knowledge of an illegal act and fail to take action against it. According to Article 17 of the new EU directive, online content hosting intermediaries will now be held directly responsible to censor any content which is not authorised by the copyright holder.

Proponents of the measure argue that it protects the rights of artists and creators, who are being deprived of the value generated from their works. Indeed, large online platforms, as gatekeepers to the internet, have disproportionate bargaining power over rightsholders. Unfortunately, the proposed directive is a problematic solution to this dilemma.

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Firstly, it makes private entities responsible for determining the boundaries of public access to copyrighted content. There are often fine lines between infringing content and what is legal use of a copyrighted work. Copyright law allows the permissionless use of copyrighted content in many cases, for example, for the purpose of parody or criticism (using a movie clip for a review), or for educational purposes (using a scientific article in a classroom). Where these lines are disputed, courts are able to step in and adjudicate in the public interest. However, this public interest does not factor into the decisions of private actors, who generally will take decisions to avoid their own liability, by censoring any disputed content – including memes which are based on copyrighted photos, or cover versions and remixes of songs.

Secondly, the scale of operation limits the practical ability of platforms to censor infringing content. 400 hours of video are uploaded to YouTube every minute – making it impossible to manually filter infringing content. The only practical way to implement this law is by using ‘upload filters’ – software which automatically determines what is legal and what is not. Unfortunately, no such software exists which is not incredibly error prone, and even then, sophisticated filters are tremendously costly (Google’s proprietary software costs upwards of USD 100 million). Start ups and small services without the ability to afford these filters will perish, entrenching the dominance of ‘big tech’ companies like Google and Facebook. If this law passed when services like SnapChat or TikTok were in there infancy, they would probably not be around today.

The effects of this move will not be limited to the EU. If the internet was once considered borderless, moves like this now erect walls between jurisdictions – it is unclear how Indian users would access content which is restricted in the EU, and services outside may chose not to cater to the EU at all, resorting to “geo-fencing” EU away from the rest of the internet. This also encourages lawmakers in other countries to erode intermediary safe harbours – in India, the Ministry of Electronics and IT has already proposed changes to the law to require intermediaries to mandatorily implement such upload filters for all ‘unlawful’ content– a move far more blunt and harmful than the EU directive, which at least includes a modicum of safeguards.

The Betamax ruling allowed innovation in content sharing technologies without requiring creators to monitor the use of their technology, or fearing that they will be liable for its misuse. Yet, as our technical ability to create and share evolves, our laws seem to be regressing from this standard. The choice for the future is clear – we can either side with this legal tradition, or place legal shackles on our ability to create, share and innovate.


About the author: Divij Joshi is a lawyer who tinkers in technology policy. He is presently a research fellow at the Vidhi Centre for Legal Policy, Karnataka, where he works on legal reforms in state and local government.

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