Digital Copyright G s to Court
Andrew Albanese -- 10/2/00
A plethora of lawsuits will help set the legal standards for electronic publishing
RIAA v. Napster
The most high-profile case. The Association of American Publishers has already voiced its strong opposition to Napster.com, which facilitates the trading of music files for free between users. A federal judge ordered Napster (E-Publishing, Aug. 21) shut down in late July, but that verdict has been stayed on appeal. The appeal hearing is now scheduled to begin the first week in October. What's at stake? If you can trade music for free over the Internet, say publishing experts, why not e-books, articles or audio books?
MPAA v. Corley
Not as high-profile as Napster, but perhaps the most important case of all. A federal judge in New York ruled in favor of the MPAA in late August, but this one, say attorneys, is headed to the Supreme Court (E-Publishing, Sept. 4). The defense claims the Digital Millennium Copyright Act, the statute that has enabled a slew of lawsuits against Internet start-ups, is unconstitutional. What's at stake? If the Supreme Court upholds the initial verdict, copyright owners will breathe freely. On the other hand, if the verdict is upheld, cyberspace free speech activists and computer programmers claim that copyright owners will have unprecedented control over the flow of information. If the Supreme Court rules that the DMCA is unconstitutional--the MPAA and the AAP's worst nightmare--all bets are off.
Tasini v. New York Times et al.
A federal judge found that a group of media conglomerate defendants led by the New York Times illegally licensed the work of freelance writers to electronic databases without the writers' permission and without payment. An appeals court recently concurred, and the case is now being prepared for the Supreme Court (News, Apr. 17). What's at stake? For writers, millions in royalties. For publishers, a fundamental reevaluation of the nature of digital rights--and those millions in royalties to the writers. The case has already had major implications. The Author's Guild recently filed a similar suit against a number of electronic archives seeking damages for copyright infringement (News, Aug 21). And recently launched online content provider Contentville entered into an agreement (News, July 31) with the National Writers Union that will pay authors at least a 30% royalty for each work sold through the service--and guarantees that writers' cuts of electronic sales will always exceed the publishers' cut. Jonathan Tasini, president of the NWU, hopes this is the beginning of a whole new royalty structure for authors.
Universal v. MP3.com
A federal judge ruled in early September that MP3.com was guilty of willful copyright infringement and ordered relief in the amount of a whopping $118 million (a figure that is likely to rise). MP3.com maintains that it simply allowed users who could prove they legally purchased a CD to convert it to MP3 format and store it online at MyMP3.com. The company says it will appeal the ruling in November. What's at stake? Concerns are widespread among digital music entrepreneurs that the major damage award will curtail investment in intellectual property-based technology ventures.
RIAA v. Scour
This recently launched suit is perhaps the most telling litigation of all. Scour.com, which counts Hollywood talent manager Michael Ovitz among its investors, bills itself as a broadband entertainment portal, and offers a Napster-like Internet exchange for the trading of virtually anything digital--only Scour claims to be copyright friendly (E-Publishing, Aug. 21). But the RIAA isn't buying it. The RIAA has filed suit for copyright infringement and the matter is currently being prepped for court. What's at stake? Scour's survival. The RIAA may have won the war simply by filing suit. Needing to pay its lawyers, Scour was recently forced to lay off nearly all of its staff. With MP3.com's major damage award looming, will anyone throw Scour an investment lifeline? Bookmark this space for further information.
WizeUp Digital Texts Head to CampusesWizeUp Digital Textbooks, the New York City-based company that offers digital editions of college textbooks (E-Publishing, May 8), has enjoyed a strong start for its first fall list, said company CEO David Gray. WizeUp has converted more than 80 higher-education textbooks into digital works and hopes to have as many as 130 digital books available by January.
To jumpstart sales, WizeUp focused its advertising and promotional efforts on 50 college campuses this fall, and Gray said that in classes where WizeUp's editions are available, 30%-35% of the students chose the electronic edition over the print product. WizeUp's e-titles are always priced lower than print editions and are usually in line with used book prices. Gray said textbook publishers view WizeUp as a way to prevent loss of sales to used book companies and are not worried about the electronic editions cannibalizing print sales. "They see us as another distribution outlet," Gray said, noting that the company has signed agreements with virtually all of the country's major college text publishers.
WizeUp has developed proprietary software through which students can download files to their computers through its Web site at www.wizeup.com. Both students and professors can customize the files to suit their particular purposes, and the titles can also be printed out. "We wanted to make our titles as interactive as possible and to give students as many options as possible," Gray said, adding that the digital texts are also available in CD-ROM formats. Although WizeUp has the capability to allow students to download only specific parts of a text, most books are offered only in their entirety. "There are lots of issues that need to be addressed," Gray said, before WizeUp will routinely offer portions of books for sale.
Gray said WizeUp, which has 65 employees, has 350 texts in its conversion pipeline and that by next August, he expects to be able offer 500 textbooks online.
Volume 246 Issue 40 10/02/2000