A new deal for end users? Lessons from a French innovation in the regulation of interoperability.

AuthorWinn, Jane K.
PositionBoundaries of Intellectual Property Symposium

ABSTRACT

In 2007, France created the Regulatory Authority for Technical Measures (l'Autorite de Regulation des Measures Techniques or ARMT), an independent regulatory agency charged with promoting the interoperability of digital media distributed with embedded "technical protection measures" (TPM), also known as "digital rights management" technologies (DRM). ARMT was established in part to rectify what French lawmakers perceived as an imbalance in the rights of copyright owners and end users created when the European Copyright Directive (EUCD) was transposed into French law as the "Loi sur le Droit d'Auteur et les Droits Voisins dans la Societe de l'Information" (DADVSI). ARMT is both a traditional independent regulatory agency and a novel attempt to develop a new governance structure at the national level to address global information economy challenges. The fear that other national governments might follow suit seems to have helped to cool enthusiasm for TPM among some businesses. This Article notes parallels between the limitations imposed on ARMT and those imposed on the first modern independent regulatory agencies that emerged in the United States in the late nineteenth and early twentieth centuries. Using history as a guide, it is not surprising that the ARMT's exercise of authority has been limited during its early years; it remains possible that ARMT may become a model for legislation in other countries. It took decades before the first American independent regulatory agencies exercised real authority, and their legitimacy was not established beyond question until Roosevelt's "New Deal." Even though information society institutions may evolve quickly, national governments are sure to require more time to develop effective, legitimate ways to ensure that global information and communication technology (ICT) standards conform to their national social policies.

TABLE OF CONTENTS INTRODUCTION I. REGULATORY AUTHORITY FOR TECHNICAL MEASURES A. The Interoperability Requirement B. The Inadequacy of Existing Institutions C. The ARMT: Its Inherent Limitations and Impact II. INDEPENDENT REGULATORY AGENCIES IN AMERICA AND FRANCE A. Independent Regulatory Agencies in America B. Independent Regulatory Agencies in France III. TECHNICAL STANDARDS AND REGULATION CONCLUSION INTRODUCTION

In 2007, France created the Regulatory Authority for Technical Measures (l'Autorite de Regulation des Mesures Techniques or ARMT), an independent regulatory agency charged with promoting interoperability of media technologies used by French consumers. (1) ARMT is both a traditional independent regulatory agency and a novel attempt to develop a governance structure to address information economy challenges. (2) The growth of digital media and the expansion of global electronic communications networks have revolutionized the ways in which information is created, distributed, and accessed. (3) Although these changes have made possible many new forms of creativity and processes for exchanging ideas, they have also dramatically facilitated the unauthorized reproduction and distribution of copyrighted works. The ensuing mass copyright infringement threatened traditional business models in the music, film, broadcasting, and video game industries. In an attempt to stifle such piracy, the media industry has implemented various strategies with a predilection for technological solutions and for the toughening of copyright laws. Indeed, content producers have embedded technologies in media software and hardware to control the way in which consumers can access, use, and copy digital media. These technologies are commonly known as "Digital Rights Management" systems (DRMs) but are referred to in legal instruments as 'Technological Protection Measures" (TPMs). (4) Unfortunately, for the media industry, TPMs are inherently fallible as ingenious hackers always find ways to circumvent them. (5) In an effort to offset this vulnerability, copyright industries have successfully lobbied international institutions and national governments to introduce legal prohibitions on tampering with TPMs. The principles of the legal protection of TPMs, and of the prohibition of their circumvention, were first set in the World Intellectual Property Organization (WIPO) Internet Treaties, (6) adopted in 1996. Anticircumvention provisions have subsequently been implemented in national laws, such as the U.S. Digital Millennium Copyright Act (DMCA) of 1998, (7) and regional instruments, such as the 2001 European Copyright Directive (EUCD). (8) The resulting legal landscape has enabled the widespread deployment of TPMs in digital content distribution. Soon enough, however, the unintended consequences of TPMs for consumers became apparent. Chief amongst them were the facts that TPMs challenged consumers' ability to benefit from copyright limitations, such as fair use, (9) and that they undermined the portability of digital media due to a lack of interoperability between competing technologies. The international copyright framework, as designed in the mid-1990s, did not address issues that materialized only a decade later. And this is precisely when France belatedly decided to abide by its international obligations and grant legal protection to TPMs.

In an original attempt to address consumer concerns raised by the widespread use of TPMs, the French Parliament passed the "Loi Relative au Droit d'Auteur et aux Droits Voisins dans la Societe l'Information" (DADVSI), (10) which created the ARMT and transposed the EUCD. (11) The DADVSI therefore departs from other European and international instruments as it tries to counterbalance the rights granted to copyright owners, through the protection of TPMs, with guarantees for consumers of cultural goods, notably in terms of interoperability of these TPMs. This Article will consider the political pressures and compromises that led to the establishment of ARMT and the scope of its mandate in order to assess its viability as a legislative model. The initial grant of authority to ARMT was narrow. Since its formation, it has carried out its mission cautiously, giving rise to criticism that it may never deliver on its original promise. (12) Notwithstanding its modest short-term impact, ARMT may one day be seen as an important experiment in the regulation of technological innovation. If ARMT ultimately becomes a model for regulatory innovations, then it would resemble the first modern independent regulatory agency, the U.S. Interstate Commerce Commission (ICC), which at first appeared to be a failure but later became a very influential model. (13)

And although independent regulatory authorities play different roles under French and U.S. administrative law, this Article will consider the status of ARMT under French administrative law in light of some significant historical developments in U.S. administrative law. The French legislature's original mandate for ARMT was challenging: to protect the French public's interest in preserving limitations on copyrights and the interoperability of TPMs. To fulfill its interoperability mandate, ARMT may require the provider of a particular technology to disclose proprietary information to a competitor to permit said competitor to achieve interoperability between the two technologies. Mandating disclosures by dominant producers represents an ex post focus on the problem, whereas promoting the use of technical standards represents an ex ante approach to the problem. This Article will therefore also consider the costs and benefits of using technical standards to preserve copyright limitations and promote TPM interoperability even though ARMT is not currently authorized to regulate the use of technical standards to achieve its goals. Despite ARMT's lack of authority, within the larger context of EU legislation in the area of standards, ARMT might serve as a legislative model for an agency with such authority in the future. (14)

In competitive markets, the use of technical standards is generally voluntary and market participants with little or no government oversight determine the degree of standardization. (15) In such contexts, government intervention may be limited to ensuring the security of contract and property rights, preventing fraud or anticompetitive behavior, or promoting the accurate disclosure of information. In the context of social regulation, however, the interaction between law and standards may be significantly different because government may require market participants to internalize certain costs they would otherwise prefer to externalize. (16) The government may mandate compliance with technical standards, provide reference standards to signal regulator expectations, or develop the standards directly. (17) With the rapid growth of the information economy, (18) conflicts between social regulations and the norms implicit in technical standards for information and communications technologies (ICTs) products and services set by market forces seem destined to increase. (19) This increase will also place pressure on legislators to grapple with the challenges of meshing ICT standards with social regulation.

ARMT's original mandate targets issues related to the distribution of copyrighted works over ICT networks. The hallmark of a network is that its value increases with the number of users connected to it, whether it is a real network (such as a railroad) or a virtual network (created by many individuals using the same ICT such as compact disk storage media). (20) With regard to activities that take place within information networks, strong positive and negative externalities produce network effects that in turn create strong pressure for convergence around a single network, product, or standard. (21) As a practical matter, ICT network-product interoperability can be achieved in a variety of ways, including through the use of proprietary technologies, such as the Microsoft Windows...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT