CSC410: Professional Practices In

IT
[Intellectual Property: Protecting Intellectual, Fair Use, And
New
Restrictions On Use Quinn: Ch4]

Lecturer: Maheen Gul

1
Chapter Overview (1/2)
 Introduction
 Intellectual property rights
 Protecting intellectual property
 Fair use
 New restrictions on use

1-2
Intellectual Property in Modern Times

 Main Idea: Intellectual property is any unique product

of human intellect with commercial value, such as
books, music, movies, software, etc.
 Key Question: Do entertainers and creators have the
right to control how their intellectual property is shared?
 Example: Music uploaded to YouTube immediately after a concert.

 Intellectual property protection is essential to encourage

innovation and safeguard creators' rights (ensure fair
compensation).

3
Control over Distribution

 Digital Era Challenge: Easy sharing of content via

platforms and piracy.
 Key Issues:
 Unauthorized distribution.
 Loss of control over where and how the content is shared.
 Rise of digital platforms has made sharing content easier than
ever.
 It is challenging for creators to control how, when, and by whom
their content is accessed.

4
Global Software Piracy Statistics

 Software piracy is widespread, especially in countries

like China.
 Global Impact: 40% of software worldwide is pirated.
 China: 80% of software used is obtained illegally.

 Ethical Question: Is it fair for some to pay full price

while others get it for free?

5
Protecting Intellectual Property

 U.S. Constitution grants Congress the right to protect

authors' and inventors' creations.
 Four primary ways to protect intellectual property:
 Trade Secrets
 Trademarks/Service Marks
 Patents
 Copyrights

6
Trade Secrets

 Confidential intellectual property that gives a competitive

advantage.
 Examples: Formulas, strategic plans, customer lists (e.g.,
Coca-Cola's secret formula).
 Protection: Active measures required, such as confidentiality
agreements.
 Advantages: No expiration if kept secret.

 Challenges:
 Legal: Reverse engineering, employee knowledge transfer.

 Reverse engineering refers to the process of disassembling a

product to understand how it works, with the intent of
replicating or improving it.
 Employee can leave & join the competitor or start his own
competing business.
7
Trademarks & Service Marks

 A trademark is a word, symbol, phrase, logo, design, sound, or color

that identifies and distinguishes goods from one business from those of
others. A service mark does the same for services.
 Protects brand identity.

 Helps consumers recognize the source of goods or services.

 Ensures product/service quality and builds trust with consumers.

 Legal Protection:

 Granted by government, giving the owner the right to use the mark
exclusively.
 Prevents others from using confusingly similar marks for similar
products.
 Examples:
 Nike's "Swoosh" logo
 Apple's apple symbol
 McDonald's Golden Arches

8
Cont…

 Genericide Risk:
 If a trademark becomes commonly used as a generic term for a
product, the company can lose exclusive rights (e.g., "Aspirin",
"Escalator").

 Examples:
 Aspirin: Originally a trademark of Bayer, but over time, "aspirin"
became the generic name for the pain-relief drug. Bayer lost its
trademark rights in many countries.
 Escalator: Originally a trademark of the Otis Elevator Company,
but it became a common term to describe moving staircases, and
Otis lost the trademark.

 Result: If a company loses its trademark through

genericide, it can no longer prevent competitors from
using the name, potentially hurting the brand's value.

9
Protection Strategies:

 Use trademarks as adjectives, not nouns:

 For example:
 Instead of saying, "I need a Kleenex," they promote, "I need a Kleenex
brand tissue."
 Similarly, Band-Aid brand promotes its products as “Band-Aid brand
adhesive bandages,” rather than simply "Band-Aids."

 Educate the public and enforce proper usage:

 Companies often launch public campaigns or issue corrections to
ensure people don’t misuse their trademarks:
 For instance, Adobe responds to people using “photoshopping” to
describe editing images by reminding them that Photoshop is the name
of a software, not a verb. Adobe says it should always be referred to as
“Photoshop software” and capitalized to maintain its trademark.
 Similarly, Xerox ran ads reminding people to refer to its product as a
"Xerox photocopy" instead of just saying "to xerox."

 By taking these steps, companies aim to preserve their

trademarks and avoid losing the exclusivity that
distinguishes their brand from generic products.
10
Patents

 A patent is an exclusive right granted to an inventor by the

government for a new invention. This right allows the
inventor to exclude others from making, using, or selling the
invention for a set period (typically 20 years in most
countries).
 SPARC International: Sun Microsystems licensed SPARC technology to
increase usage.

 Advantages:
 Incentivizes Innovation: By providing temporary monopolies, patents
encourage inventors to invest time and money in creating new products.
 Financial Benefits: Patent holders can license their patents or sell them
for profit.

 Challenges:
 Patent Trolls: Some entities buy patents solely to sue others for
infringement, without creating any products themselves.
 Patent Complexity: The process of filing for a patent can be complex,
expensive, and time-consuming.

11
copyrights

 Copyright provides authors with rights over their original

works.
 Five Key Rights:
 Right to reproduce the work.
 Right to distribute copies.
 Right to publicly display the work.
 Right to perform the work in public.
 Right to create derivative works.

12
Copyright Usage and Licensing

 Authorization: Copyright owners can authorize others

to use their work.
 Example: Licensing a play for a high school drama club.

 Royalties: Artists are paid through organizations like

ASCAP, BMI, SESAC for public performances.
 Protection: Copyright owners can prevent
unauthorized reproduction, distribution, display,
performance, and derivations.

13
Case Study: Davey Jones Locker

 Background: Richard Kenadek ran a computer bulletin

board system (BBS) called Davey Jones Locker.
Subscribers paid $99 a year for access to the BBS,
which contained copies of more than 200 commercial
programs. In 1994, Kenadek was indicted for infringing
on the Intellectual Property copyrights of the owners of
the software.
 Outcome: Sentenced to six months home confinement
for software copyright infringement.
 Key Point: Copyright infringement applies to digital
content and software distribution.

14
No Electronic Theft (NET) Act

 Incident: David LaMacchia’s, an MIT student,

distributed $1 million worth of software for free.
 However, the prosecutors were forced to drop charges
against LaMaccia because he had made the programs
available for free. Since he had not profited from his
actions, he had not violated
copyright law.
 Result: 1997 NET Act closed this legal loopholes,
making it a crime to distribute $1,000+ worth of
copyrighted material, even without profit motive.

15
Fair Use Concept

 Sometimes legal to reproduce a copyrighted work

without permission
 Courts consider four factors
 Purpose and character of use
 Nature of work
 Amount of work being copied
 Affect on market for work

1-16
Fair Use Example

17
Analysis of Example

 Factor 1: Purpose of Use The first factor to consider is the

purpose of the use. In this case, the purpose is strictly
educational. This weighs in favor of fair use.
 Factor 2: Nature of the Work The second factor considers
the nature of the work being copied. The journal articles in
question are non-fiction. This also weighs in favor of fair use.
 Factor 3: Amount Used The third factor considers the amount
of material being copied. Since the professor is copying entire
articles rather than brief excerpts, this weighs against a finding
of fair use.
 Factor 4: Effect on the Market The fourth factor assesses the
effect the copying will have on the market for journal sales. If
the journal in question is no longer in demand for sales, then
the professor's actions may not impact the market. However, if
the professor took care to prevent people outside the class from
accessing the articles, this factor may weigh in favor of fair use.

18
Conclusion

 Overall, three of the four factors weigh in favor of fair

use. The professor's actions likely constitute fair use of
the copied material.

19
Sony v. Universal City Studios

 Sony introduced Betamax VCR (1975)

 People started time shifting TV shows
 Movie studios sued Sony for copyright infringements
 U.S. Supreme Court ruled that time shifting is fair use

1-20
Time Shifting

1-21
Digital Recording Technology

 Copying from vinyl records to cassette tapes introduced hiss

and distortions
 Introduction of compact disc a boon for music industry
 Cheaper to produce than vinyl records
 Higher quality
 Higher price  higher profits
 BUT it’s possible to make a perfect copy of a CD, with DAT.
 The Recording Industry Association of America opposed the
introduction of DAT recorders in the United States.
 On the other side were Sony, Phillips, and other electronics
companies that wanted to sell these devices to consumers.

DAT: Digital Audio Tapes

1-22
Audio Home Recording Act of 1992

 Protects rights of consumers to make copies of analog

or digital recordings for personal, noncommercial use
 Backup copy
 Give to family member
 Digital audio recorders must incorporate Serial
Copyright Management System (SCMS), so consumers
can’t make a copy of a copy.
 The SCMS allows a consumer to make a digital copy from the
original recording, but it prevents someone from making a
copy of the copy.

 SCMS is typically built into the hardware of digital recording

devices, such as Digital Audio Tape (DAT) recorders and MiniDisc
players. It automatically detects and enforces the copy
protection rules during recording.

1-23
RIAA v. Diamond Multimedia
 MP3 compression allowed songs to be stored in 10% of
the space, with little degradation
 Diamond introduced Rio MP3 player (1998)
 People started space shifting their music
 RIAA started legal action against Diamond for violation
of the Audio Home Recording Act
 U.S. Court of Appeals, affirmed that space shifting is
consistent with copyright law

 Recording Industry Association of America (RIAA)

1-24
Space Shifting

1-25
Kelly v. Arriba Soft

 Kelly: Photographer maintained Web site with copyrighted

photos.
 Arriba Soft: Created search engine that returned thumbnail
images
 Kelly sued Arriba Soft for copyright infringement
 U.S. Court of Appeals, 9th Circuit, affirmed that it was fair use.
 Two factors heavily favored Arriba Soft’s claim of fair use.
 First, Kelly’s original images were artistic creations designed to provide
the viewer with an aesthetic experience. The thumbnail images
created had such low resolution that enlarging them resulted in a
blurry image with little aesthetic appeal.
 Second, Arriba Soft’s use of Kelly’s images did not harm the value of
the original images or the market for these images. If anything, the
search engine’s display of Kelly’s images “would guide users to Kelly’s
web site rather than away from it,” increasing the demand for his
photographs

1-26
Google Books

 Google announced plan to scan millions of books

held by several huge libraries, creating searchable
database of all words
 If public domain book, system returns PDF
 If under copyright, user can see a few sentences;
system provides links to libraries and online
booksellers
 Authors Guild and publishers sued Google for
copyright infringement (copying books for
commercial reasons)
 Out-of-court settlement reached (read the five
important benefits of the agreement and also the
criticism that followed and ruling of US district court)
1-27
New Restrictions on Use
Counterfeit CDs = Lost Profits

© Reuters/CORBIS

1-28
Digital Millennium Copyright Act

 First big revision of copyright law since 1976

 Brought U.S. into compliance with Europe
 Extended length of copyright
 Extended copyright protection to music
broadcast over Internet
 Made it illegal for anyone to
 Circumvent encryption schemes placed on
digital media
 Circumvent copy controls, even for fair use
purposes

1-29
Digital Rights Management

 Actions owners of intellectual property in digital form

take to protect their rights
 Approaches
 Encrypt digital content
 Mark digital content so devices can recognize content as copy-
protected

1-30
Secure Digital Music Initiative (SDMI)

 SDMI was an effort to create copy-protected CDs

and secure digital music downloads that would play
only on SDMI-compliant devices.
 Goals
 Create copy-protected CDs
 Secure digital music downloads
 Consortium of 200 companies developed “digital
watermarking” scheme (it took 3 years).
 Failed
 Internet copying became huge before SDMI ready
 Some SDMI sponsors were electronics companies
 Digital watermarking encryption cracked (read more
about it in chapter 4)
1-31
Sony BMG Music Entertainment
Rootkit

 Millions of audio CDs shipped with Extended

Copy Protection, a DRM system
 Prevented users from
 Ripping audio tracks into MP3 format
 Making more than 3 backup copies
 Relied upon Windows “rootkit” that hid files
and processes; usually only hackers use
rootkits
 Huge public outcry once secret uncovered
 Sony BMG stopped production and
compensated consumers
1-32
 Encrypting DVDs

 Contents of DVDs encrypted using Content

Scramble System (CSS)
 Need decryption keys to view a DVD
 Jon Johansen wrote a decryption program for
Linux
 2600 Magazine published the code
 Motion picture studios sued 2600 Magazine
and won
 Johansen tried in Norway and found not guilty

1-33
Foiling HD-DVD Encryption

 Hardware, software, and entertainment

companies created Advanced Access Content
System to encrypt HD-DVDs
 Encryption key posted on Digg.com
 AACS leaned on Digg.com to censor postings
containing key
 Digg users fought back
 AACS “expired” the key and issued a new one
 A month later, a Digg user posted the new
key

1-34
Criticisms of Digital Rights
Management
 Any technological “fix” is bound to fail
 DRM undermines fair use
 DRM could reduce competition
 Some schemes make anonymous access impossible

1-35
Online Music Stores Employed Digital Rights
Management

 When iTunes Music Store opened, all music

was protected with a DRM scheme called
FairPlay
 FairPlay blocked users from freely exchanging
purchased music
 Songs couldn’t be played on more than 5 different
computers
 Songs couldn’t be copied onto CDs more than 7
times
 Songs purchased from iTunes Store wouldn’t
play on non-Apple devices
 DRM-protected music purchased from other
online retailers couldn’t be played on iPod 1-36
Online Music Stores Drop Digital Rights
Management

 Consumers complained about

restrictions associated with DRM
 European governments put pressure on
Apple to license FairPlay or stop using
DRM
 Amazon reached an agreement with all
four major music labels to sell DRM-free
music
 Apple followed suit in 2009

1-37
 Microsoft Xbox One
 Microsoft announced cloud-based gaming
experience for Xbox One (June 2013)
 User could play any game without disc in tray
 Automatic software updates of every Xbox One

 Controversial features of licensing arrangement

 Disc could be shared only once
 Second-hand market restricted
 Xbox consoles would have to check in every 24 hours

 Microsoft backtracked
 No need to connect to Internet
 Freedom to lend, rent, buy, sell discs
 Disc must be in tray to play game

1-38