The Migration of Intellectual Property to the Internet
21. When the World Wide Web was first developed in the 1990s, it transformed the Internet from a technological infrastructure into a popular network linking people in diverse communities throughout the world. The Internet, and "killer apps" such as the Web, became the instrument by which people throughout the world exchanged and shared ideas, information and, gradually, goods and services. What had begun as a military and research tool became the conduit for electronic commerce forecast to be worth US$6 trillion by 2004, [13] and the harbinger of the "information age". The Web now contains several billion pages of information, growing at the rate of more than seven million pages each day. [14] It is this ready availability of information on every conceivable subject, combined with advancements in digitization, that has made the Internet such a revolutionary tool.
22. There are numerous .com companies that rely on business models that trade in physical objects of intellectual property. The online traders Barnes and Noble and Amazon, for example, utilize vast databases of book, video and music titles and user-friendly purchasing systems to attract consumers away from the shopping mall, and then send these products (each a work of intellectual property) to consumers using postal mail. Travel sites and airline companies such as EasyJet and RyanAir and entertainment ticket sellers such as Ticketmaster, profit through saved overheads by conducting sales online, using e-ticketing or mailing tickets to purchasers. Numerous small and medium sized enterprises have used the Internet in this way, as a marketing tool to locate buyers for their products in a huge global marketplace.
23. It is, however, the digitization of works of intellectual property, by a process that reduces text, visual images and sound to computer-readable binary code of "0"s and "1"s, grouped in bits and bytes that can travel over the networks, that has enabled intellectual property to transfer so efficiently to the Internet. This rising trend led John Perry Barlow, Internet commentator and co-founder of the Electronic Frontier Foundation, to speak of the "digitization of everything not obstinately physical." [15] Internet traffic has been doubling every six months, [16] and the flow of this data over the Internet, first measured in megabits and gigabits, and now in terabits and petabits (1,000 trillion bits), includes the transmission of works of intellectual property. The Internet offers an unprecedented channel through which foreign markets that number more than half a billion users [17] and the diaspora of nationals living abroad and hungry for access to their cultural heritage, can be exploited.
24. The character of the intellectual property system is evolutionary and while the nature of the rights themselves, to control and exploit the products of one's creativity and innovation, remains relatively constant, the manner by which they are expressed and exchanged is constantly adapting to developments in the underlying technologies. The invention of, in turn, the printing press, phonograms, radio and television broadcasting, cable and satellite transmission, videocassette recorders, compact disc (CD) and digital versatile disc (DVD) technology and, now, the Internet, has affected both the form and the substance of intellectual property rights. Ever adaptable, intellectual property has now migrated to the Internet and is being modified to suit the online environment in ways that are described in the following chapters. Intellectual property has gained importance in this digital environment as, increasingly, business assets are reflected in intellectual as opposed to physical property. The value of many online companies, for example, may be found in their vast databases of customer information, which may be the subject of intellectual property protection. [18]
25. This migration of intellectual property onto the Internet can be seen with respect to each species of rights. In the field of copyright, vast numbers of works of literature, film and art, and notably computer programs, have already transferred to the digital environment. Software, protected as a form of intellectual property by patent and copyright law, underlies the operation of all digital technologies. [19] Systems software, including utilities and operating systems, enable our computers to operate, while utilities software provides us with the programs that make the digital networks so useful. Much software is protected by intellectual property law, and its theft is endemic. [20] It is estimated that 40% of business software programs worldwide were pirated in 2001, at a cost to the industry of some US$11 billion. [21] As one commentator stated: "[C]omputer security and digital rights are so vexing because their solutions seek to protect technology from itself. How does one make computer systems secure from code writers whose goal is to defeat such security? And how does one protect digital content when technology, by its nature, encourages copying?" [22]
26. Textual works such as books and newspapers are ideally suited to digitization and, although online publishing of popular literature has had a mixed reception with a public accustomed to paper and ink, there is evidence of a growing demand for e-books. [23] There has been real success in the online availability of science, technology and medical publications, where the demand for fee-based research has supported the e-publishing industry. [24] Demand has also grown for the online collections of more than 7,300 libraries that have provided free remote access to the texts of hundreds of thousands of e-books, with particular demand for non-English language texts. [25] One commercial operation, Ebrary, offers consumers paid access to more than 10,000 recently published titles, as well as maintaining a database of digital books for libraries. [26] Online newspaper publishing is also prolific, [27] although many of these initially free sites are now seeking to introduce subscription access. In September 2002, for the first time, The New York Times received more visitors to nytimes.com (1.28 million daily), than its weekday paper circulation (1.2 million daily). Increasingly, numerous journalists and aspiring writers have engaged in online publishing to post "blogs", Web logs or journals, that allow individuals to make their views available to the public without the need for intermediation by large publishing houses or distributors. [28]
27. In the field of fine art, indigenous craft and artifacts, numerous museums and art galleries have digitized their collections and made them available for viewing on the Internet. [29] One such site, Artnet, [30] allows users to access works by over 16,000 artists and in over 1,300 art galleries. Interesting questions have arisen as to whether the digital images of works of art, themselves, become derivative works entitled to copyright protection. [31] There are also many artists using the digital technologies themselves, to create art specifically for the digital networks. [32] One site, the Digital Art Museum, [33] provides an online resource for information and works of digital art.
28. Intellectual property, through the trademark system, also facilitates the identification of goods and services and allows consumers to distinguish those produced by a certain enterprise. The importance of commercial branding, traditionally achieved through the use of trademarks combined with advertising and marketing strategies, is heightened in an online environment where consumers are naturally cautious, traders may be remotely located and there is little or no physical contact to reassure purchasers of a company's financial security and bona fides. The Web is a territory where caveat emptor is the rule and, as a result, consumers increasingly rely upon strong brand awareness and brand performance for the confidence to engage in e-commerce. [34] While trademarks are of greater importance in this virtual environment, they are also more vulnerable to infringement, dilution and anticompetitive practices, as described in Chapter III(b) below. Trademark owners expend vast resources, engaging automated "web crawling" software and cybersurveillance firms, to monitor the billions of Web pages and protect their intellectual property rights.
29. Identity on the Internet also goes beyond the trademark system, because of the role played by the Internet domain name system, which facilitates users' ability to navigate on the network. Domain names are user-friendly addresses that correspond to the unique Internet Protocol numbers that connect our computers to the Internet and enable the network routing system to direct data requests to the correct addressee. Domain names were originally intended to perform a purely technical function in a user-friendly way, but because they are intuitive and easy to remember they now perform a function as business or personal identifiers. Most businesses, whether e-commercial or not, advertise their domain name to signal a Web presence. In this way, although, as such, not a form of intellectual property, domain names now perform an identifying function similar to that of a trademark. Because of the way in which people and search engines operate, most businesses use their trademark or trade name as their domain name, and this has caused conflict with the advent of predatory practices, known as "cybersquatting." These developments, and international efforts to resolve these conflicts, is described in Chapter III(c) below.
30. The patent system has also migrated to the Internet, as businesses have sought to recoup research and development costs in digital technologies by patenting their online business methods. The Japanese Patent Office defines "business method inventions" broadly as "inventions which are concerned with methods or systems of doing business using computers or the Internet." [35] In fact, the technology-intensive nature of e-commerce means that many of its constituent processes may be patentable subject matter so long as the legal criteria for patentability are met. Some controversy has developed over patents granted with respect to business methods, originally by the United States Patent and Trademark Office and increasingly in other jurisdictions such as Australia, Canada, Japan and the Republic of Korea. [36] High profile patents in America have included the U.S. 5,851,117 (Priceline.com), U.S. 5,960,411 (Amazon.com) and U.S. 5,193,056 (State Street Bank). [37] A case involving State Street Bank, raised awareness of the patentability of business methods, as the United States Court of Appeals held that methods of doing business should be subject to the same legal requirements for patentability as applied to any other processes, that is, they should be new, useful and non-obvious. [38] Patents have since been granted for electronic shopping carts, [39] online credit card payment systems, [40] and for a system to manage personal privacy in a computer network. [41] The European Patent Office has taken a more restrictive approach, requiring that the subject matter of a patentable invention have a "technical character" or involve "technical teaching". Some countries, such as Chile and South Africa, exclude protection for business method patents under their patent laws. [42]
31. The "global information society" foreseen in the early days of the Internet has yet to become a worldwide reality, but the focus on information remains the key to the e-commerce economy. Although a good proportion of the information on the Web is in the public domain, that is, freely available to use and copy, an increasingly significant amount is protected as intellectual property. [43] The enthusiasm excited by the availability of so much online information, easily accessible through browsing and hyperlinking, contributed to a general expectation that this information was free and its use uncontrolled. Even the term "hacking", as initially understood, was a positive concept that implied expertise in computer programming. [44] The intellectual property community has been addressing the challenge of this perception, in an effort to determine and exert legal rights over digital content, ever since. [45]
32. Difficult issues are raised for this community by the vast availability of intellectual property on the Internet, the ease of copying and distribution of copies and the relative anonymity afforded to these digital transactions. Key among these challenges is the expectation among many users that information and intellectual property sourced or downloaded from the Internet should be free of charge. Many .com companies took the approach that it was initially more important to make their products (information) available freely, and thereby establish a market presence, and to address issues of revenue and profit at a later stage. Most of these companies did not endure the burst of the .com bubble in March 2000. Many companies that continue to operate in the online environment have developed other business models, often relying on advertising revenue or value-added service charges to finance their free services and information. Surveys have shown that consumers are gradually becoming more willing to pay for online content. [46] However there remains a general reticence to pay for material that was once free. The business and financial news sites, offered by CNN, ABC and The Wall Street Journal, for example, have been relatively successful in charging for content, as they established an early pattern of charging for information and found customers who saw value in their purchase. [47] This trend suggests that education of online consumers is key, through programs designed to raise awareness at an early age of the value of intellectual property and the realization that unauthorized copying of such works is theft.
33. The intellectual property community, including film and music creators, software developers, authors and publishers, are now exploring ways in which to make their products available online, while protecting their rights and recouping their investment. To some extent, the uptake of fee-based intellectual property services is dependent on the efficient management of these rights, as well as the availability of workable and secure methods of micropayments that would enable pay-per-unit purchases, and the building of consumer confidence in online payment security, privacy and consumer protection. At the same time, however, creators and intellectual property rightsholders need to feel sure that they can protect their property from piracy and control its use, before they will be willing to make it available online.
34. The current levels of online piracy were described by an American litigant as "a 21 st century piratical bazaar." [48] New international laws such as the WIPO Internet Treaties, described in Chapter III(a), adapt the intellectual property laws to facilitate the dissemination of protected material over the Internet. Technological tools such as encryption and watermarking provide practical solutions and, together with digital rights management initiatives, contribute to meeting this concern. However, many creators and rightsholders remain apprehensive. When the American singer-songwriter, Bruce Springsteen, released his new CD "The Rising", only ten advance discs were released and none were available online before being sold in stores, in an effort to thwart online piracy. [49] Conversely, some music executives use online "leaks" of forthcoming musical releases to win fans and media exposure, and thereby boost disc sales.
35. One approach is to employ business models by which subscribers, eager to access intellectual property in the form of music, film, software or text, can be persuaded to legitimately purchase these products, instead of relying upon illegal markets. Surveys have shown that the priority for users of online music file-trading services was availability of a wide number of compositions, and ready access, while the free price was a lesser consideration. [50] Subscription services, based on secure and monitored access are being explored. In the music industry, for example, subscription music downloads and streaming services are available through a variety of proprietary systems including, eMusic, MusicNet, FullAudio, Rhapsody, Liquid Audio, Inc. and Pressplay, [51] that seek to replace the popularity of more than 200,000 unauthorized online music sharing sites, including Napster, Morpheus and KaZaA. [52] These "peer-to-peer" (P2P) networks enable millions of users to upload and share their music and film files via the Internet, often infringing copyright in the works they trade. As described in Chapter III(a) below, the copyright industry in various countries has taken legal action to prevent the widespread piracy via the P2P networks, with some success, although the problem is not yet solved. Some systems, like Napster, use a centralized server to process the transfers, while others are decentralized and more difficult to regulate, and the industry has grappled with how to target millions of individual pirates and rapidly evolving technological methods. Although the music industry is now embracing the online medium, it continues to grapple with the problem of piracy, as 950 million pirated music discs were sold in 2001, in a world pirate-music market valued at US$4.3 billion. [53]
36. The online distribution of audiovisual works has been held back until recently by the lack of bandwidth, which has prevented the relatively large data files required to transmit video to be downloaded or streamed at a speed or quality acceptable to consumers. Nevertheless, more than a million users are typically online with Morpheus, a P2P site that enables users to trade video files, and most PCs now come with CD burners that can be used to compress and store films on discs without any significant loss in quality. While the technology is still developing to facilitate accessible video-on-demand and digital pay-per-view, the film industry is yet to match the progress of the music industry, and most legitimate film sites are webcasters that distribute short made-for-online film and animation material which is largely experimental and available free of charge. [54] As in the music industry, copyright owners in the film industry are also reluctant to release their audiovisual works online while there is a lack of adequate copy protection that could protect them from rampant piracy, that today sees 400,000 to 600,000 films downloaded illegally every day. [55] For these reasons, major studio executives have forecast that film distribution via the Internet will account for only 4% of revenue by distribution channel by 2010. [56]
37. In the radio and webcasting industry, Internet radio has been luring customers away from traditional media sources by providing access to thousands of global radio broadcasts in real time.[57] Since January 2001, the total audience time spent listening to monitored Web radio stations increased by 749%. [58] For some time, Internet radio was unregulated, however in the United States, the Digital Millenium Copyright Act, 1998, established that webcasters must pay royalties to record companies that hold the song rights for the copyright music they play under statutory compulsory licenses for digital performances. [59] The issue is then what royalty rates such entities can afford to pay as, as discussed above, listeners have not traditionally paid for content received online. Following a June 2002 determination of royalty rates by the United States Government (of 0.07 cents per song per listener), KPIG, the first commercial radio station to stream its broadcasts over the Internet suspended its webcasts, stating that it was not making money from its Internet services and could not afford new royalties. [60]
38. In the changing digital marketplace, convergence of media, communications and information technologies have been mirrored by the convergence of multinational corporate structures, as content providers in the copyright and entertainment industries have merged with communications, cable and online service providers. One example has been the merger in 2000 of America Online (AOL) and Time Warner, to create the world's largest media conglomerate, a "clicks and mortar" company that combined AOL's online service capacities with Time Warner and its media offspring (including cable networks CNN and HBO, Time Warner movies and Warner Music) the Time Warner cable network, linking 21 million American homes, and significant media content (32,000 television titles and magazines including Time and Sports Illustrated). [61] Immediately prior to the merger, the combined market value of AOL and Time Warner was US$290 billion, creating a post-merger company valued at US$350 billion, which had fallen by August 2002 to a market capitalisation of about US$45 billion. [62] Similarly, the merger in December 2000 of the trans-Atlantic media and communication group Vivendi with Seagram created the media conglomerate Vivendi Universal, that included Universal Music Group, Vivendi Universal Entertainment and Publishing, MP3.com, American publisher Houghton Mufflin, French broadcaster Canal Plus, joint-ownership (with Vodafone) of the Vizzavi Internet portal, a 44% stake in Cegetal telecom company, as well as utilities units Vivendi Environment. Vivendi Universal reported losses of 13.4 billion euros and a debt of 19 billion euros in 2001, and losses of 12.3 billion euros for the first half of 2002. [63] Arguably, the relative roles of the content provider and access provider, and how these two entities may successfully syndicate, remains a question for a changing marketplace in the digital economy.
39. Intellectual property has migrated to the Internet, both in substance and as a concept vital to the success of e-commerce enterprises. The "Wired Index" of the key businesses in the global economy, published by Wired Magazine, states that these companies "have demonstrated a mastery of five essentials needed to prosper in the technology-enabled, borderless world: innovation, intelligent use of new tools, strategic vision, global reach, and, above all, networked communication." [64] It is notable that the premier criteria, innovation, also serves as the basis for the intellectual property system, such that the promotion of innovation and the protection of its products is the goal of intellectual property law, more imperative than ever in this digital age.
[13] Supra note 12.
[14] See Cyveillance Study Report "Internet Exceeds 2 Billion Pages," (July 10, 2000) at http://www.cyveillance.com/web/newsroom/releases/2000/2000-07-10.htm.
[15] See John Perry Barlow, "Selling Wine Without Bottles: The Economy of Mind on the Global Net," in High Noon on the Electronic Frontier: Conceptual Issues in Cyberspace, (Peter Ludlow, ed., 1996) at pp.9-10.
[16] See Lawrence Roberts, "Internet Still Growing Dramatically Says Internet Founder," (August 15, 2001) at http://www.caspiannetworks.com/press/releases/08.15.01.shtml.
[17] Nua reported approximately 580.78 million people had Internet access, representing some 10% of the world's population (see NUA Internet Surveys, "Onwards and Upwards," (August 12, 2002) at http://www.nua.com/surveys/). Netsizer shows more than 812,000,000 at Internet users as at August 2002, and its website allows viewers to watch this number constantly growing, at http://www.netsizer.com.
[18] The European Union Database Protection Directive (No. 96/9/EC of March 11, 1996), according to the legislative history of Section 71, defines a database as "a collection of independent works, data or other materials arranged in a systematic or methodical way or individually accessible by electronic or other means" and requires Member States' database protection laws to protect the owners of databases from the "repeated and systematic extraction and/or reutilization of insubstantial parts of the contents of the database by implying acts which conflict with a normal exploitation of that database."
[19] A "computer program" is "[a] set of instructions capable, when incorporated in a machine readable medium, of causing a machine having information processing capabilities to indicate, perform or achieve a particular function, task or result." See WIPO Model provisions on the protection of computer software, Geneva, 1978. Refer generally to an article by Daewhan Koo, "Patent and Copyright Protection of Computer Programs," Issue 2, Intellectual Property Quarterly, pp.172 - 211 (2002).
[20] Some non-proprietary software, called "open source", has been developed based on a certification standard set by the Open Source Initiative that requires the source code of a computer program to be made freely available to the public, relying on peer review to detect errors and encourage software development under a form of license that allows modifications and derivative works (see http://www.opensource.org ).
[21] See Report by the Business Software Alliance, "Seventh Annual BSA Global Software Piracy Study," (June 2002), at http://www.bsa.org/resources/2002-06-10.130.pdf. See also D. Ian Hopper, "Group Says Software Piracy on Rise," FindLaw Legal News, (June 10, 2002) at http://www.findlaw.com.
[22] Refer generally to an article by Jonathon Krim, "The Internet Gets Serious: Security, Copyright Problems Must be Resolved as Medium Matures," Washingtonpost.com, (June 28, 2002) at http://www.washingtonpost.com.
[23] eBookWeb (see http://www.ebookweb.org) reports traffic of 500,000 page views per month, while Palm Digital Media ( http://www.palmdigitalmedia.com ) reported sales of 180,000 titles in 2001. See M.J. Rose, "Promising Chapter in E-Book Story," Wired News, (July 9, 2002) at http://www.wired.com .
[24] See, for example, ScienceDirect, which provides access to over 1,500 technical journals and 40 million scientific articles on the basis of a license fee or pay-per-view (at http://www.sciencedirect.com ).
[25] See David D. Kirkpatrick, "Battle Over Access to Online Books," The New York Times on the Web (June 17, 2002) at http://www.nytimes.com.
[26] See http://www.ebrary.com/ . One controversy has arisen over the business practice of RosettaBooks, a company that offers libraries unlimited access to 100 20 th century classics for an annual fee of between $200 and $1,000, having acquired the rights to publish digital editions of the books directly from the authors, on the basis that their existing contracts were exclusive of digital rights. The U.S. Court of Appeals upheld a restrictive view of the scope of publishing licenses under State law in Random House Inc. v Rosetta Books LLC, 2d Cir., No. 01-7912, 3/8/02. Kirkpatrick (2002), supra note 25.
[27] For example, Online Newspapers.com (at http://www.onlinenewspapers.com/), Paperboy (at http://www.thepaperboy.com/welcome.html ) and the Internet Public Library (at http://www.ipl.org/div/news/ ), consolidate the sites of thousands of newspapers from around the world.
[28] There are currently more than 40,000 blogs (see http://www.blogfinder.com and http://www.daypop.com/top), the most popular of which may be purchased by large media enterprises. See Andrew Sullivan, "An Honest Blogger Will Never Make a Quick Buck," The Sunday Times, p.4 (October 13, 2002); Jonah Goldberg, "Attack of The Blogs," The Washington Times (May 24, 2002) at http://www.washingtontimes.com ; and John C. Dvorak, "The Blog Phenomenon," PC Magazine (February 5, 2002).
[29] The Museum Computer Network (at http://www.mcn.edu/resources/sitesonline.htm ) and Virtual Library Museums Pages (at http://vlmp.museophile.com/ ) list more than 1,000 museums and museum-related sites globally that maintain digital collections online.
[30] See Artnet (at http://www.artnet.com/ ).
[31] See Barbara Hoffman, "Public Domain Artwork: Who Owns the Rights?," IP Worldwide, pp.52 - 58 (2000).
[32] For example, see the Digital Art Source (at http://www.digitalartsource.com/index2.shtml ).
[33] The Digital Art Museum at http://www.dam.org/intro.htm .
[34] See Laura Rush, "Top E-Commerce Companies Analyzed," Internet.com, (July 30, 2002) at http://ecommerce.internet.com ; and Robin D. Rusch "Apple Shines: 2001 Brand of the Year Results," Brandchannel.com (March 4, 2002) at http://www.brandchannel.com/features_effect.asp?id=82#more .
[35] See Chapter 1, "Implementing Guidelines for Inventions in Specific Fields", Japanese Patent Office (April 1, 1997), at http://www.jpo.go.jp/infoe/sisine.htm . See Koo (2002), supra note 19, pp.172 - 211, at p.174.
[36] See Toru Takano, "Research and Study on the Trend of New Areas (Business Method)-related Inventions," IIP Bulletin, pp.32-42 (2001); Thomas B Koch, "Patenting e-Business Methods in Europe," International Internet Law Review, pp.43-46 (April 2001); Reinier B. Bakels, "How to Find and Define Proper Boundaries for Patentability," Paper for the Workshop "Frontiers of Ownership in the Digital Economy," Paris, (June 10-11, 2002).
[37] See Arun Chandra, "Protecting Business Methods in the United States," Vol. 5(4), The Journal of World Intellectual Property, pp.545-563 (July 2002).
[38] State Street Bank and Trust Co. v. Signature Financial Group, Inc. (149 F. 3d 1368, 1375) Fed. Circ. 1998.
[39] U.S. Patent No. 5,790,793, issued 8/4/98 to Thomas Higley.
[40] U.S. Patent No. 5, 724,424, issued 3/3/99 to Open Market, Inc.
[41] U.S. Patent No. 5,855,08, issued 12/29/99 to CyberGold, Inc.
[42] See FICPI International Questionnaire Report, Rodney Cruise, "A Report on Patent Protection of Software, e-Commerce and Business Methods" (2001).
[43] See James Hilton, "An Introduction to Copyright and Fair Use in the United States," Regents of the University of Michigan, Fathom, (2002) at http://www.fathom.com .
[44] The term "hacker" is defined by Webopedia as "a slang term for a computer enthusiast, i.e., a person who enjoys learning programming languages and computer systems and can often be considered an expert on the subject(s). Among professional programmers, depending on how it used, the term can be either complimentary or derogatory, although it is developing an increasingly derogatory connotation. The pejorative sense of hacker is becoming more prominent largely because the popular press has co-opted the term to refer to individuals who gain unauthorized access to computer systems for the purpose of stealing and corrupting data." at http://www.webopedia.com/TERM/h/hacker.html .
[45] Refer generally to an article by Krim (2002), supra note 22.
[46] A survey conducted by the Online Publishers Association of the online transactions of 1.1 million consumers found that consumers spent US$675 million for digital goods and services in 2001, nearly double the US$350 million spent in 2000. See Matt Richtel, "A Shift Registers Willingness to Pay for Internet Content," New York Times on the Web, (August 1, 2002) at http://www.nytimes.com .
[47] Business and news sites raised revenue of US$214.3 million in 2001 from selling content, mainly through subscription fees. The Wall Street Journal has 650,000 subscribers, and the ABC has established an "ABC News on Demand" fee-based subscription service. CNN has also introduced fees for access to its video material. See Ibid.
[48] As filed by the plaintiffs in an action brought by the Motion Picture Association of America (MPAA) and the Recording Industry Association of America (RIAA), against Kazaa, Musiccity.com Inc., Musiccity Networks Inc., and Grokster Ltd. in the U.S. District Court for the Central District of California, October 2, 2001. See "Kazaa Denies Copyright Infringement Claims; Developer Says P2P No Different Than HTTP," 7 (5) Electronic Commerce and Law Report, p.99 (January 2002).
[49] See Chris Nelson, "Springsteen Protects His New CD's Online in an Old-Fashioned Way," The New York Times On the Web, (July 15, 2002) at http://www.nytimes.com .
[50] See Gretchen Hyman, "The Fate of Online Music at Streaming Media," Internet.com, (April 25, 2002) at http://www.internet.com .
[51] Universal Music Group offers content from some 1,000 albums via EMusic.com, a unit of Vivendi Universal Net USA, while MusicNet is a joint venture of AOL Time Warner, Inc., Bertelsmann AG, EMI Group and RealNetworks, Inc., Rhapsody is a service of Listen.com, and Pressplay is a joint venture of Vivendi and Sony Corporation.
[52] See presentation of Richard Gooch, Senior Technology Adviser, International Federation of Phonographic Industry (IFPI), London, at WIPO Seminar on the WIPO Copyright Treaty and WIPO Performances and Phonograms Treaty: Opportunities and Challenges, Geneva, (May 16, 2002) at http://www.wipo.int/documents/en/meetings/2002/sccr/seminar_05/wct_wppt_ge02_inf1.htm.
[53] See IFPI's "Music Piracy Report 2002," at http://www. ifpi.org .
[54] Such short film sites include http://www.atomfilms.com and http://www.ifilm.com , and animation sites such as http://www.icebox.com, http://www. entertaindom.com (featuring Warner Bros. cartoons) and http://www.joecartoon.com . See generally, Andrea D. Fessler, "The Next Frontier: Film Distribution Over the Internet," Issue 8, Entertainment Law Review, p.183 (2000).
[55] Data compiled by research firm, Viant, suggests that 10 million users attempted to download illegal movies online, but only two million succeeded in obtaining complete copies, as reported by Reuters, "Internet Movie Piracy on the Increase," as reported by Nua Internet Surveys (May 30, 2002) at http://www.nua.com/surveys/ .
[56] According to an Andersen survey of major studio executives. See Report of Screen International and Andersen, by John Nedick, Rob Matthews and James Thomas, "The Big Picture: 2010: An Entertainment Odyssey," p.7 (2001).
[57] Radio Locator, for example, lists over 10,000 radio stations available online (at http://www.radio-locator.com/cgi-bin/page?page=about ).
[58] Internet radio streaming audience size and demographic data provided by the MeasureCast Internet Radio Listening Index™, at http://www.measurecast.com .
[59] In the case of Bonneville International Corp. v Peters, (E.D. Pa. No. 01-0408, 8/1/01), the United States District Court for the Eastern District of Pennsylvania affirmed that webcasts do not qualify for the statutory exemption available under the Copyright Act (17 USC. §114(d) (1) (A)) for transmissions of digital audio works, and are liable to record companies for royalties due on broadcasts simultaneously transmitted over the Internet. See "Webcasters of Radio Broadcasts Not Exempt From Paying Royalties to Record Companies," Vol. 6(31), Electronic Commerce and Law Report, p.839 (August 8, 2001).
[60] See David Ho, "Rates Set for Royalties on Internet," June 20, 2002, Yahoo! News at http://www.yahoo.com , and Associated Press, "Internet Radio Pioneer Stops Webcasts," Yahoo! News (July 22, 2002).
[61] See "Time Warner: An Entertainment Blue Chip," and "The First ?Clicks-and-Mortar? Company," BBC News, (October 11, 2000) at http://www.bbc.co.uk .
[62] See "AOL Faces Shareholder Lawsuits," The Age, (August 12, 2002) at http://www.theage.com.au .
[63] See Charles Masters, "Falling Down" and "Embattled Messier Ousted," The Hollywood Reporter, p.1 and pp.14-15 (July 2-8, 2002). See also Business Wire, "Vivendi Universal Reports First Half 2002 Results," New York Times On the Web (August 14, 2002) at http://www.nytimes.com .
[64] The Wired Index is at http://www.wired.com/wired/archive/10.07/Myth.html?pg=1 See James Surowiecki, "The New Economy Was a Myth, Right? Wrong," Wired Magazine, p.90 (July 2002).
