DVDGuy’s Blog @ Digital Digest

There’s a surprising amount of news to get through, most of them coming in the last few days, while previous week’s news stories continue to provide the goods, which just goes to show that it’s rather foolish to be overconfident in dealing with the Internet masses, because a train doesn’t run you over when it’s late, and coffee doesn’t turn into acid over time (see Andrew Crossley remarks regarding Operation Payback, if you don’t get the reference).

We’ll start with the repercussions of Operation Payback, which should occupy a fair bit of the copyright section this week (and promises to occupy more of it in the following weeks, until Anonymous’ anger subsides, if it subsides).

The leaked ACS:Law emails are still providing a wealth of information on how one of the most notorious copyright settlement firms operate. There was at first the details about just how much money have been made so far, and how much money is expected to be earned as more and more people fall foul of the settlement notices. As I noted last week, the entire business is motivated by money, which isn’t necessary wrong, except there’s very little emphasis on stopping piracy, apart from the side effects of these types of lawsuits. You get the feeling that if it was possible to somehow encourage piracy, so this little business can continue for a while longer, then some of the less reputable law firms may just do this. After all, if it’s all about the money, then it will all end when people stop pirating stuff.

And as if to further proof the point I made above (or maybe the more likely explanation is that I made the point above so I can segue nicely into a new paragraph … but I’m not that clever!), not only do certain law firms care little for actually stopping piracy, they themselves are engaging in it for their own commercial gain, which is way worse than people who can’t afford to buy movies downloading pirated copies. Again, uncovered from ACS:Law’s email archives, is a little incident involving another law firm, Tilly, Bailey and Irvine, which sought help from ACS:Law in regards to starting their own copyright settlement business. But instead of taking mailing templates and creating their own unique ones based on the ones provided, Tilly, Bailey and Irvine decided it would be easier to just use the templates without license. Geeze, it’s easy to get caught in this piracy things isn’t it? ACS:Law’s Andrew Crossley, which has overnight become one of the most famous, or is that infamous, people in the Internet world, wasn’t happy at TBI’s actions, and I guess it was pretty silly for TBI to commit acts of copyright infringement against a copyright law firm.

What was more interesting though was that TBI ceased their copyright settlement operations after discovering the negative side of all that money – the bad publicity. This is nothing news, as the father of copyright settlement law firms in the UK, Davenport Lyons, also quit from the game for the same reasons. TBI mentioned that the extra resources needed to deal with the bad publicity took them by surprise a bit, even though it really shouldn’t. This could point to a way to fight off the copyright settlement vultures, because while not all care about bad publicity, some do and public pressure can be effective. Most of these law firms practice traditional law as well, and if their copyright settlement stuff is hurting their other business, then that may make them think twice.

Cornered! is the latest movie the USCG is suing downloaders for

Which may be why the law firm Dunlap, Grubb, & Weaver created the US Copyright Group, as to separate their copyright settlement stuff from the rest of their work. It’s not really working though, not if you consider the bomb threat they received this week, which luckily turned out to be a false alarm. With the economy the way it is, people don’t need a mass mailing telling them to pay up hundreds and thousands of dollars for a movie that costs less than ten, and it’s understandable some people may just go too far. Also, the irony of their association with the movie The Hurt Locker, could point to just a prank. But this isn’t stopping the USCG, as they filed more Doe lawsuits this week, for two more movies. Low Orbit Ion Cannons and bomb threats can’t stop the USCG, although some judges can, and this week, the USCG had to deal with a small setback in one of their ‘Hurt Locker’ lawsuits. The reason is not important, it was a jurisdiction problem, but it does show that the court is not always on the USCG’s side, and that the growing public anger may in fact make judges examine the USCG’s case (or lack of one) a bit more carefully in the future.

Back to Operation Payback for a moment, it is still very much going on, with many more firms and organisations being targeted, including one here in Australia (the AFACT). The effectiveness of the LOIC as a DDoS tool is debatable, since it’s apparently easy block, but the successful attacks so far have been from sympathizing groups and individuals, it appears. The ACS:Law email leak is still so far the crowning achievement of the operation, although it very much happened by accident. If we can put aside the debate about the legality of such protest actions, the message is clear though. People don’t like the way they’ve been treated in this copyright crusade. and they’re speaking out. They no longer want to be just labelled a “criminal” and treated, by governments and groups like the MPAA/RIAA, as if their concerns are not legitimate. And even criminals have rights, rights that our governments have been too eager to give away to protect the interests of the rich and powerful entertainment lobby. There are real reasons why piracy is rampant, and it may not even have anything to do with pirated goods being cheap or free. If we believe the copyright holder’s argument that they are losing money to piracy, then it means that people who can afford to pay are not, and are deciding to choose something that’s illegal and dangerous instead. But then if the reality is that the people downloading are the ones that can’t afford to pay, then what is actually lost by the copyright holders? And if it’s because pirated content is easier to get hold of then paid for content, then who is to blame for this? Pirates for making things too easy, or copyright holders who makes things too hard for consumers? If there is to be a debate on copyright, these are the issues that need to be examined. And maybe, just maybe, a solution can be found.

Progressive political forum Democractic Underground has been hit with a Righthaven lawsuit

And now back to the lawsuits. The newspaper copyright trolling continues with Righthaven hitting a fairly large target this time. Left wing political forum Democratic Underground has been hit by such a lawsuit, when supposedly one of their users posted an article from one of the newspapers that Righthaven represents. But if Righthaven was expecting a prompt payment of the settlement fee, then they may need to think again when suing an Internet, political savvy opponent, which has since brought the EFF to help out with their defence and counter-suit. Democratic Underground, as a forum, should have protection under the DMCA’s safe harbor provision because they do have strict rules in regards to copyright, but I suspect they will go beyond this technical defence and question the very nature of these types of lawsuits when it comes to preventing freedom of speech, which is exactly what a political forum provides. But the DMCA is actually an issue, because normally, the newspaper in question can request an article to be removed by filling a simple DMCA notice, but obviously, there’s no profit in that. With the rate ads are paying (ie. not much), one can argue that newspapers are not losing much at all when people copy their articles verbatim (but usually with a link to the original article), but the positive effects of having their work publicized and if the link to the original article has been posted, the positive effects in terms of search engines, which bring in more people to their website, should all be considered. Which is why before Righthaven, newspapers often requested full articles to be removed, but were happy with excerpts and definitely happy with links to the original article. But the settlement fees earned means that it’s much more profitable to sue, than to reason. In any case, I expect Democratic Underground to put up one hell of a fight, with assistance from the EFF, and if I was Righthaven, I would regret very much regret picking such a target instead of some poor blogger.

The EFF has had a minor victory this week too, forcing the proposed Combating Online Infringement and Counterfeits Act to be delayed in the Senate, after they organized 87 prominent Internet engineers and pioneers to write an open letter attacking the act. Apparently, what the government is proposing, in order to help out their music and movie studio buddies, may actually break the entire Internet. Which is just exactly what you would expect from them really, and I mean both sides of politics, and like puppy dogs, they’re all competing with each other to earn the attention of their masters. If there was some place where they could fire a nuke at, to stop online piracy, they would have done it already, it’s what I’m getting at. So while the US Senate was busy doing what it does best, which is to do nothing, the controversial ACTA treaty reached a significant milestone with a basic agreement being reached, which may force the Senate’s hands (not that they need any forcing).

And The Pirate Bay appeals trial started this week too, after delays over accusation of bias. Well, when before you even start the trial, the judges have already had accusations of bias aimed at them, and none of them recused themselves, then that’s not really a good start, and I don’t expect any positive result. But on the other hand, any negative result probably won’t affect TPB’s operations anyway, so what’s the point really.

And from the same people that wanted phone ring-tones to be considered a form of public performance, the ASCAP which represents composers and publishers, has tried to get a court to say that a download is also a public performance, despite downloads not making any noise apart from the “ding” when it completes (depending on your browser/settings). The court denied their “ring-tone” arguments, and they denied their download arguments too. If I was a member of the ASCAP, I would be embarrassed at their actions, going out and making an ass of themselves in court. The ASSCAP perhaps? If they get their way, pretty much, even humming a tune would be a public performance, and eventually, even thinking about a song may be mean having to pay royalties.

Moving onto 3D/HD news. The news this week was that Blu-ray penetration has reached 17%. There has been some pretty poor stats recently for Blu-ray sales in the US at least, but I’m not surprised at this figure at all.

Blu-ray's growth rate has slowed recently due to lack of hit releases

But whether this 17% can be turned into 80/90%, or whatever DVDs have, that’s another question. Without top new releases, Blu-ray hasn’t been growing as fast as previously, but with the best titles coming thick and fast in the next few month, that could change. I’m still mostly confused as to the intentions of studios when it comes to Blu-ray. Do they want it to completely replace DVDs, and then suffer the same problem as DVDs in terms of ever dropping revenues (until Purple-Ray or whatever next comes out), or are they positioning Blu-ray as a complementing format to DVDs, one that is sold at a premium to slow down the decline of movie prices? With current pricing, it seems studios want Blu-ray to completely replace DVDs (for example, the Iron Man Blu-ray+DVD combo can be had for less than the two disc DVD set at some places, or only a couple of dollars more elsewhere), because the premium is shrinking to the point where it doesn’t exist for many titles. On the other hand, not all titles are being released on Blu-ray, so it seems studios are not that keen on Blu-ray totally replacing DVDs.

3D Blu-ray will probably up the pricing a bit, or at least that’s what studios hope will happen. But in time, it too will drop in price to the point where 3D editions will be included with the standard 2D release. So it seems to me that getting people to pay more for the same stuff isn’t a long term solution, but perhaps getting people to buy more for less per item may be the way to go.

Or you can just charge $30 per movie and hope someone is stupid enough to pay for it. That’s Hollywood’s new plan, after they got the FCC to agree to break analogue outputs, so they can release movies faster to the home, before it’s available on Blu-ray/DVD. It’s basically another release window, this time delivered without a disc, but most likely heavily DRM infested. And it appears to be for a single viewing only. I talked about solutions to the piracy problem further up in this WNR, but if this is the solution (analogue DRM + stupidly high pricing + more DRM), then they really need to stop coming up with them. You can see how they think this might work too – $30 is less than what a family pays to watch the movie at the cinemas, but more than what they would pay for the Blu-ray/DVD. Or they can just download it for free, without the DRM too. You see where the problem is?

And finally in gaming, Nintendo thinks it may have found the solution to the piracy problem on the DS – the upcoming 3DS will have new anti-piracy updates that happen automatically in the background, any time the DS is connected online.

While I believe the innovations offered by the 3DS, that is the glass free 3D screen, will be enough to ensure it sells extremely well when it is released early next year, I don’t really think the anti-piracy features will really stop piracy. I’m sure some hacker somewhere is already salivating at the prospect of disabling the 3DS’s automatic updates, and open up the portable console to mass piracy like that experienced by the DS.

Smartphones like the iPhone is becoming a threat to portable game consoles like the Nintendo DS

But even despite the piracy, the DS sells quite a few games, and it’s a good earner for Nintendo. It’s just not as a good earner as the piracy stats suggests. But I think Nintendo’s biggest problem isn’t flash carts, but smart phones. While DS games are mostly still longer, phone games are becoming more sophisticated, and sometimes, people only want to play a short game. And certainly, the price is more appealing. And the range of games, especially on the iPhone, makes the DS range of games look pitiful by comparison, and all the big game studios have already signed up to produce games for the iPhone (and soon to Android I think), not to mention the many indie game producers. So what Nintendo needs is to open up an apps space for the DS, one that allows indie producers to have a go as well, so homebrew doesn’t have to be confined to illegal flash carts. An online marketplace with cheap games will help keep things fresh, and I think Nintendo will be surprised how much more people spend when they’re only paying a buck or two for games – most likely more sales than if games were prices at ten times this price. Micro-transactions are the future.

That’s all I’m going to write this week. I suspect next week will be quite boring as the Internet media rehash most of the interesting stories from this week over and over again. Look at me, I’m already making excuses …