Digital personal property

June 28, 2010
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As the Institute of Electrical and Electronics Engineers meets to debate standards for digital content, Cue Supply Chain’s Bob Auger ponders who owns what in the world of online publishing.

Since the days of Alexander Graham Bell and Guglielmo Marconi, the Institute of Electrical and Electronics Engineers, or I-triple-E as it is universally called, has been at the heart of a mission to set technical standards for all manner of things. It now controls a portfolio of 900 active standards with more than 400 pending. It is essential work that underpins the development of most consumer electronics formats long before the first frame of film or note of music is created for a new platform.

Which is why two words merit special attention in this week’s IEEE announcement of plans to establish a standard for consumer-owned digital personal property. Those words are “perpetual ownership” – the definition that states without question that a digital representation of entertainment content is “mine – and I can do what I like with it”.

Before jumping to the conclusion that this will be an open invitation to unfettered piracy, think about the car in your driveway. If you bought it from a dealer, assuming you have made all the payments, the car is yours. Within legal limits, you are free to drive it wherever you wish and to sell it whenever you desire. Until then, as the registered owner, you are identified clearly as the person responsible for the vehicle and should you decide to lend it friends, they can use it too.

Should it be stolen, you report the theft to the police. If you or your friends use it for illegal purposes, the police will come after you. In any event, the ownership of the car is undoubted: it is your car. You own it and the manufacturer and designer of the vehicle has no say in the matter after you have taken delivery.

Now consider the compact disc or any of its predecessors, back to the phonograph cylinder. You buy the physical product in a shop and again you have no doubt that it is yours. If you lend it to a friend or take it to a party, it remains yours, even if it is not promptly returned. Months or even years later, you might ask the friend if your disc is still around and, occasionally, you might get it back.

If the disc happened to be an original numbered acetate by Joy Division or a limited edition release from a major artist, such as the Zippo lighter LP sleeve for The Wailers “Catch a fire” album (pictured), it might even have gained in value since you acquired it, especially if it is in mint condition. Since the disc is still “yours” you can sell it, with some rare items fetching over five figures on eBay.

So what constitutes “ownership”? Paul Sweazey chairs the IEEE working group that will deal with issues surrounding perpetual ownership, under the snappy title “P1817TM: a new standard for consumer-ownable digital personal property”. He poses the question, “What if physical goods couldn’t be owned? The world would be in chaos.”

Sweazey describes piracy as “stranger sharing” and says that an IEEE standard would allow owners of digital products to share them with family and friends, in the same way as we do now with physical product: one sharable instance. He says the intention is to create the digital equivalent of private goods. “Ownable personal property,” Sweazey calls it.

He says, “Most of the conflicts between consumers and suppliers exist because they think that they own what they buy, but this isn’t yet true for digital products. Consumers are continually surprised and dismayed by this.”

Ownership is linked inextricably with the possession of the physical object but if, as it increasingly is, that object is an online digital representation, who then owns it? Millions of digitised items are “sold” each year through iTunes, app stores and other online outlets but rarely is the consumer the owner in the traditional sense of the word.

June’s interview with Tesco Entertainment Category Director Rob Salter by Cue Entertainment editor Sam Andrews      might have left readers with the impression that the Digital Entertainment Content Ecosystem (DECE) and its Disney-backed alternative, Keychest, were specifically dealing with issues of ownership, and certainly these plans should make access to digital content on different platforms a less complex task.

But Sweazey says, “DECE is a great project, aimed at erasing as many of the barriers as possible to giving consumers that ownership feeling and sense. It will not, however, give consumers actual ownership of products.”

Ownership has become a major issue in the games market, where “pre-owned” second-hand titles have long been a source of frustration for publishers. Earlier this month, Tesco announced that it would buy back used computer games from customers for up to £10 less than they paid for them, giving the refund in the form of a credit on a Tesco money card. The games are then resold at a substantial discount to new owners.

Industry figures suggest that an average game can be traded up to four times, activity they claim is a threat to profit margins at a time when the industry as a whole is challenged by recession.

The response from some publishers has been the inclusion of a pass-card in the package with an “activation code” that can be used once only. Second and subsequent buyers are unable to use the game unless they pay an additional charge.

That is a hurdle that some claim is an infringement of the EU regulation that says, “once an item is offered for sale, the intellectual property rights are exhausted”. It gives consumers a legal right to resell any physical item they have legitimately acquired.

Tanner Sandlin, a citizen of Austin, Texas, took full advantage of that notion when he found the 13th known copy of an Atari 2600 game, “Air Raid”, in his garage, having bought it for under $10 in the 1980s. The only example to survive in its original packaging, the game cartridge later sold for $31,600 on eBay, the second-highest recorded sum paid for a pre-owned title. 

The publisher received nothing.

Publishers are considering online delivery of games as an alternative to packaged media for no other reason than to reduce the trading of physical copies. Downloads are seen as offering greater protection for the content developer but recent events have caught the attention of regulators.

Amazon in the US has taken that approach with books. Only a year ago, the online retailer unilaterally revoked ownership of the Kindle ebook “Big Brother” from certain customers, deleted data from their digital devices and refunded the original purchase price. Amazon told The Guardian, “It was added to the catalogue by a third party who did not own the rights. Customers were told it was no longer available for purchase and we removed the illegal copies from our systems and from customers’ devices.”

In its attempt to ensure that the interests of all parties are represented in setting standards for digital ownership, the IEEE working group will seek additional members before the inaugural meeting on July 14. Sweazey is unsure what the outcome will be although it could range from a simple statement of conformity to a recommendation of government-enforced legal protection for the ownership of digital personal property.

“In the end, the solution to rational, peaceful, global commerce in downloadable digital products will involve the evolution of copyright law so that it can discern between the copying of bits and the counterfeiting of products,” Sweazey says.

When Marconi received the first trans-Atlantic wireless message at Signal Hill in Newfoundland, Canada, in December 1901, it’s unlikely he was worried about ownership of the content. His pioneering work was, however, challenged by the Anglo-American Telegraph Company, who claimed a 50-year monopoly on trans-Atlantic communications. Over 100 years later, when as much data can be sent in a fraction of microsecond as Marconi managed over several days, we still can’t decide how to allocate ownership of electronic impulses.

The original message, had it survived, would no doubt be worth a fortune today but alas, we only have a transcription of what Marconi heard on his telephone receiver, 1,700 miles from the transmitter in Cornwall. It was “pip, pip, pip…”