Copyright Crackdown

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The record industry has been targeting online music sharing for years, but now it has undertaken a new war--against "casual piracy."

Sony BMG and EMI have begun shipping compact discs using technology that limits the number of copies you can make of any disc to three. And you can't port songs from affected CDs to Apple IPod players unless you request a workaround from Sony.

The move, along with other recent developments in copyright protection such as the Supreme Court's ruling this summer in MGM v. Grokster, a copyright infringement case pitting Hollywood against the Grokster peer-to-peer network (see "Court Sets File-Sharing Limits"), could have a lasting impact on your entertainment choices. And you may not like the remix.

Sony BMG's copy-protected CDs incorporate First 4 Internet's XCP2 (extended copy protection) technology. The company is the first major label to offer XCP2-protected CDs to consumers, although Sony BMG already ships some CDs using MediaMax copy protection from SunnComm. The new effort uses different technology, but with the same end result for consumers: a limited ability to copy. By the end of this year, Sony BMG says, most of its CDs sold in the United States will incorporate one of these technologies.

EMI is employing a similar strategy with its CDs, using technology from Macrovision that lets you make just three copies; the first titles using the technology should be on sale in stores by the time you read this.

'Speed Bumps'

"Our goal is to create a series of speed bumps that make it clear to users that there are limits [to copying]," says Thomas Hesse, president of Sony BMG's Global Digital Business Group. "If you attempt to burn 20 copies and distribute them to all of your friends, that's not appropriate."

Sony BMG labels discs that use the technology as copy-protected. The company says that its customers find a limit of three copies to be fair.

Sony BMG CDs using the XCP2 technology launch their own software to track the number of copies you make.
Sony BMG CDs using the XCP2 technology launch their own software to track the number of copies you make.

When you insert the CD into your Windows-based computer, the disc launches its own audio player software, which warns you that you'll be allowed to make only three copies of the disc. You can make those copies from within the Sony BMG audio player, or you can use that software to rip the files to your music library. (For this purpose you must use a music player that supports secure Windows Media Audio files, like Musicmatch, RealPlayer, or Windows Media Player, but not Apple's ITunes.)

The copy protections are not iron-clad, however: You can make three copies of the CD on each PC on which you load it. You can also make three additional copies of the CD from the tracks that you have ripped to your Windows Media Player library. Once you have burned CDs using Windows Media Player, the tracks cease to be protected, and you can upload this audio CD into another media player, such as ITunes. And once the tracks are uploaded, you can burn them as often as you like.

One potential problem for consumers is that the protected CDs prevent PC users from moving songs to Apple IPods. That's because Apple refuses to license its FairPlay digital rights management technology so that other companies can accommodate it. If you inquire, though, Sony BMG will e-mail you a workaround.

This raises a key point about XCP2: It's not meant to be unbreakable, according to First 4 Internet's chief executive Mathew Gilliat-Smith. "We have achieved a good balance of protection and playability."

In fact, XCP2 is not as strict as XCP, the company's original product. Sony BMG and the other major labels have been using XCP since 2002 on prerelease CDs sent to radio stations and internal employees, Gilliat-Smith says. XCP not only prevents copying, but in some cases prevents discs from playing in certain devices, he says. Sony chose XCP2, not XCP, for consumer CDs because discs with that encryption play well in most devices.

XCP2 may affect more than just CDs: The company is currently working on versions for DVDs and online music files, Gilliat-Smith says. Sony BMG will ship the DVD technology to U.S. movie studios for use in prerelease copies of movies by late 2005, he hopes, and will introduce a version for commercial DVDs later. He declines to say which movie studios have expressed interest in using the technology.

What's Fair Use?

Not everybody thinks that record companies' focus on "casual piracy" is smart. Some copyright law reform advocates say that sharing copies of music with family members and friends and making "mix" compilations have long been social norms--it's the sharing with strangers that costs record companies significant revenue. If record companies insist otherwise, they'll make people ignore copyright rules wholesale, says Ernest Miller, a Yale Law School fellow who works on copyright reform issues. (See his blog here.)

The term "casual piracy" is "really a bit of propaganda," according to Miller. "It's an effort to use language to frame the legal arguments," he says.

The record companies want to chip away at the existing standard for fair use and move casual copying into the realm of copyright infringement, he says. Someday, the definition of "casual piracy" could be important in a lawsuit.

What's next? Like it or not, copy protection on CDs will only increase, in the opinion of IDC senior analyst Susan Kevorkian. She expects that more companies will follow Sony BMG's lead. "There's a very narrow line between casual copying and proliferation of content online," she says.

As for the war against casual piracy, you should understand that Sony BMG is not looking to prosecute you for making more than three copies, Miller says. The company is really attempting to shape future legal battles.

"They're looking for ways to extend their control over music and charge for the various ways we use music," he says. Whether companies can do so and avoid a consumer backlash remains to be seen.

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