The Cato Institute recently published Tim Lee's paper on the DMCA. As might be noted in a police report, "words were exchanged" between the author, my colleagues, and myself on a number of points, substantive and otherwise. My take on this issue is that it presents hard problems. It is of no help whatsoever in resolving these problems to make factual and legal errors. So I will now review the record, try to identify errors, set out what is known and what is still unknown, and further explore the case against and for the DMCA.

The paper states, "The practical legal control the movie industry exercises over playback may be a modest annoyance for most users, but users of the Linux operating system have particular reason to be upset. The DVD CCA has yet to approve any DVD players that would work on computers that run the Linux operating system. Frustrated by the industry's neglect of their beloved operating system, open-source developers created a program called DeCSS in October, 1999. . . Linux developers in the United States are likely to avoid writing DVD software for fear of legal trouble. . . " and adds, later, as an aside in discussing Blue-Ray, "Not only could it decline to approve video products, as the DVD CCA did to software Linux players, Blue-Ray could use BD+ to ..."

Here are the facts as I have been able to confirm them:

The DVD CCA licenses CSS keys to anyone willing to comply with the terms of the royalty-free license, including the payment of a $15,000 fee. The DVD CCA has no reason to enquire and does not usually know what platform the keys are going to be used for. At least one Linux player had been licensed at the time DeCSS was developed. A number of Linux players, both hardware and software such as LinDVD and Linspire, have been licensed over the years. In short, the DVD CCA has not declined to approve software Linux players.

The next set of issues relate to the development of Linux players and DeCSS. The argument that DeCSS was primarily intended to make DVD's playable on machines running Linux would be stronger if DeCSS were a Linux program. But it was a Windows application. The reasons don't matter so much. Bottom line; if you have a Windows platform to run DeCSS, you can run a Windows player, you don't need a Linux player. (The claim is that releasing DeCSS as a Window's application was necessary to read the data from the DVD's. But some reports have Derek Fawcus releasing Linux code capable of doing just that. Furthermore, at the time of DeCSS's release, it contained some of Derek Fawcus's code that had been released under the GPL, but did not itself comply with that license; Jon Johanssen, who released DeCSS, later negotiated a private license with Fawcus. The story of Linux and DVD players may be compelling indeed, but DeCSS is an odd choice of program to champion.).

What is left? Mr. Lee has acknowledged some errors in this area, and has reconstituted his arguments accordingly. Unfortunately, though, I find this process (along with his breaches of professional etiquette) painful and refuse to grapple with them any longer. It is like watching an animal in a trap gnawing off its leg to escape. If one wants something done right, I find, one has to do it oneself. So here we go:

The Problem: After the development of CSS as a standard for protecting DVD content, it was necessary to license keys in order to develop a mainstream player. Licensed Linux players have remained rather obscure.

I think that is a fair statement of the basic situation. Several observations:

Given the availability of CSS licenses to anyone willing to comply with its terms, it simply cannot be true that the need to license CSS is an obstacle to the development of a Linux player. It may be that the $15,000 application fee is too much for a volunteer developer community to pay. If, however, the price were lowered to $500, CSS would become less useful at excluding free riders by screening out those bent on mischief. The application fee is certainly not too steep for one of the commercial companies interested in open source (Sun, IBM, Google) to step in. So, why have such projects remained obscure?

Two primary types of reasons. The first set of reasons are ideological. Some open source developers don't believe in DRM and the restrictions that it has been used to support. Some don't want to hide keys. A second set of reasons are economic; investing time in open source projects is one thing, but real money is another, when the business model doesn't support selling the software for a price and especially when DeCSS is available for free. Finally, the number of people who a) run Linux as an operating system and b) do not own maintstream DVD players is I suspect very small. Occasionally, someone will run into a problem with region coding and want to play a DVD on his computer (someone who runs into the problem often can buy an all-region player). But, essentially, there is not much of a market here for the product, volunteer or otherwise.

But let's back up a step. There is an underlying fact here driving this set of circumstances. Something basic. What is it? It is that movie makers do actually protect their movies with CSS. If there were a significant number of movies being released without protection, well, unlicensed players would abound, and consumers would at least be able to watch those perfectly legally. So why hasn't that happened? Is this some kind of anticompetitive conspiracy on the part of movie industry moguls? Are they just stupid? If it is, it is a splendid opportunity for someone to come along and step into the breach . . . But hardly anyone has. To any investor, that market just does not look viable. We are back to basics. You want a viable market, you need to be able to exclude a critical mass of free riders. The legal system isn't up to millions of individual lawsuits against individual acts of copying.

CSS is a standard like any other. It has competitive implications; those not willing to work with the standard must find a market niche outside of it. It isn't the fault of that standard if the niche is a very small one. The relative obscurity of Linux players has little or nothing to do with the DMCA. The situation we set out above needs a new sentence, to the effect that the best content is not being developed for players that will not protect it. Adherence to the view that content should be free and clear of restrictions will keep open source developers perpetually in niche markets--unless they start to invest their own resources in developing such content. But open source developers with a more flexible ideology can work in the current economic space just fine.

Furthermore, the obscurity of Linux players is a relatively narrow, short-run problem compared with the larger problem of how to exclude masses of free riders enough to tempt investors to develop new content business models in movies, music, software, photographs, and so on. Lee's argument here amounts to the claim that one has the right to access content created by another conveniently. But this simply does not make good policy if it threatens the viability of the market as a whole.

The argument that a technological war of all against all would not in fact threaten the viability of the market as a whole is a more interesting one--at least in being at the right level to qualify as a public policy argument and not a mere complaint. Unfortunately, this argument is rarely pursued beyond tired references to the the money the movie industry made after the Sony case and noting that DRM does not prevent (all) piracy. And more errors. So I'll continue this tomorrow and hopefully be able to work my way back to the larger issues. I need to add some links, too.