[Congressional Record Volume 149, Number 47 (Monday, March 24, 2003)]
[Senate]
[Pages S4326-S4328]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Mr. WYDEN:
S. 692. A bill to require the Federal Trade Commission to issue rules
regarding the disclosure of technological measures that restrict
consumer flexibility to use and manipulate digital information and
entertainment content; to the Committee on Commerce, Science, and
Transportation.
Mr. WYDEN. Mr. President, today I am introducing the Digital Consumer
Right To Know Act. The thrust of this bill is quite simple. Digital
media companies are racing to develop technologies to combat piracy.
Some of these anti-piracy measures could have the effect of restricting
lawful, legitimate consumer uses as well as unlawful copying. My bill
says that if digital content is released in a form that prevents or
limits reasonable consumers uses, consumers have a right to be told in
advance.
The shift from analog to digital technologies carries many potential
benefits for all concerned--for technology companies, for producers of
music, video, and other content, and above all, for consumers. Digital
technologies, together with the rise of the Internet, promise to expand
exponentially the possibilities for circulating, marketing,
manipulating, and using creative works. There is so much more you can
do, and so many fertile fields for innovation.
The shift to digital, however, also carries twin risks. The first,
and the one on which Congress has focused most of its attention to
date, is the risk of piracy. Digital technologies can greatly
facilitate unlawful copying and distribution. This is a real problem,
because people and companies that create copyrighted works must be
fairly compensated. America's information-based economy depends on it.
The second, closely related risk is that, in combating piracy, the
baby will get thrown out with the bathwater. In the name of anti-piracy
[[Page S4327]]
protections, legitimate consumer uses could be stifled. Encryption or
other ``digital rights management'', DRM, schemes could be employed
that restrict consumers' ability to take full advantage of the
potential of the new digital technologies. In the end, it's not
inconceivable that digital media could be more restricted and less
flexible than other copyrighted items--an ironic result for a
technology that was supposed to represent a great step forward for
consumers.
The bill I am introducing today focuses on this second risk.
Significantly, it would not in any way dictate to content companies
what types of copy protection or DRM schemes may or may not be used.
Instead, it would ensure that consumers are fully informed of any
impact on their ability to use and manipulate the content they buy.
Advance notice of technology-based use limitations is a matter of
basic fairness. Consumers have developed a number of legitimate
expectations concerning how they may use and manipulate content, and
are likely to develop new expectations as technology develops. For
example, consumers increasingly expect to be able to shift legally
purchased content between different devices--to access it on their
computers, or in their cars, or using portable devices like MP3
players. They should be told in advance if these expectations won't be
met, so that they can factor this information into their purchasing
decisions. Consumers should know what they are getting or not getting.
In addition, I believe that imposing this kind of notice requirement
will help promote the development of solutions that strike an
appropriate and acceptable balance between protecting against piracy
and preserving utility and flexibility for consumers. Overly
restrictive approaches would require disclosures that content providers
could find embarrassing, and consumers could be alienated by measures
that don't seem to respect the importance of user flexibility. In
short, full disclosure would strengthen the market-based incentive to
avoid technologies that are too restrictive of consumer flexibility.
My bill would also make a clear statement that Congress expects that
there will be competition in the retail distribution of copyrighted
digital content. This shouldn't be controversial: today, compact discs,
books, and movie videos are distributed via many competing retail
stores. They also often face competition with stores selling used
content, and with rentals and libraries. But what if new DRM
technologies permit copyright holders to limit or prevent the ability
of unaffiliated entities to sell or distribute content on a secondhand
basis? Could the copyright holder sharply reduce competition at the
distribution level, and thus increase its market power? My legislation
addresses this risk by expressing the sense of the Congress that it is
important to retain competition among distribution channels for digital
information and entertainment content.
As the debate over digital copyright issues continues, I intend to
listen to all sides. This country needs balanced approaches that
respect the interests of copyright holders and consumers alike. But the
bill I introduce today is a significant step that Congress could take
now that would protect consumers of digital content and promote market-
based solutions, all without rewriting any copyright laws. I urge my
colleagues to join me in this effort.
I ask unanimous consent that the text of the bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:
S. 692
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Digital Consumer Right to
Know Act''.
SEC. 2. CONGRESSIONAL FINDINGS AND PURPOSE.
(a) Findings.--Congress finds the following:
(1) Consumers have developed a number of legitimate
expectations concerning how they may use and manipulate
legally acquired information or entertainment content for
reasonable, personal, and noncommercial purposes. In
addition, as digital technology creates new ways to use and
manipulate content, consumers are likely to develop new
expectations that reflect the new technological
possibilities.
(2) Digital technologies also can facilitate unlawful
reproduction and distribution of information or entertainment
content subject to copyright protection. To combat this
problem, technology and content companies are developing and
deploying technologies to prevent or deter such unlawful
behavior.
(3) Such technologies could help promote a competitive
digital marketplace in which consumers have a broad range of
choices and media businesses can pursue a variety of business
models. However, there are also significant risks.
(4) There is a risk that technologies developed to prevent
unlawful reproduction and distribution of digital information
and entertainment content could have the side effect of
restricting consumers' flexibility to use and manipulate such
content for reasonable, personal, and noncommercial purposes.
(5) There is a risk that such technologies could unfairly
surprise consumers by frustrating their expectations
concerning how they may use and manipulate digital content
they have legally acquired.
(6) There is a risk that such technologies could result in
greater market power for the holders of exclusive rights and
reduce competition, by limiting the ability of unaffiliated
entities to engage in the lawful secondhand sale or
distribution of such content.
(b) Purposes.--The purposes of this Act are--
(1) to ensure that consumers of digital information and
entertainment content are informed in advance of
technological features that may restrict the uses and
manipulation of such content, so that--
(A) consumers may factor this information into their
purchasing decisions; and
(B) there will be a strong, market-based incentive for the
development of technologies that address the problem of
unlawful reproduction and distribution of content in ways
that still preserve the maximum possible flexibility for
consumers to use and manipulate such content for lawful and
reasonable purposes; and
(2) to express the sense of Congress concerning the
importance of retaining competition among distribution
channels for digital information and entertainment content.
SEC. 3. FAIR DISCLOSURE OF TECHNOLOGICAL USE RESTRICTIONS.
(a) FTC Rulemaking.--Not later than 1 year after the date
of enactment of this Act, the Federal Trade Commission shall
issue rules to implement the disclosure requirements
described in subsection (b).
(b) Disclosure Requirements.--
(1) In general.--If a producer or distributor of
copyrighted digital content sells such content or access to
such content subject to technological features that limit the
practical ability of the purchaser to play, copy, transmit,
or transfer such content on, to, or between devices or
classes of devices that consumers commonly use with respect
to that type of content, the producer or distributor shall
disclose the nature of such limitations to the purchaser in a
clear and conspicuous manner prior to such sale.
(2) Manner of disclosure.--The Federal Trade Commission
shall prescribe the manner of disclosure required under this
subsection, which may include labels on packaging or such
other means as the Commission determines appropriate to
achieve the purposes of this section. The Commission may
prescribe different manners of disclosure for different types
of content and different distribution channels.
(c) Disclosure of Certain Limitations on Reasonable
Consumer Activities.--The following are examples of
limitations which shall trigger the disclosure requirements
of subsection (b):
(1) Limitations on the recording for later viewing or
listening (popularly referred to as ``time shifting'') of
audio or video programming delivered--
(A) via free over-the-air broadcasting; or
(B) as part of a multichannel video or audio system in
which the consumer obtains the programming as part of a
subscription package, with no per view charges and no ability
to select the specific time at which individual programs will
be delivered.
(2) Limitations on the reasonable and noncommercial use of
legally acquired audio or video content--
(A) in different physical locations of the consumer's
choice (popularly referred to as ``space shifting''); or
(B) on the electronic platform or device of the consumer's
choice, including platforms or devices requiring that the
content be translated into a comparable format before such
use.
(3) Limitations on making backup copies of legally acquired
content distributed in a form or medium that is subject to
accidental erasure, damage, or destruction in the ordinary
course of use, including through computer failure or computer
viruses, to be used only in the event that the original
copies are lost or damaged.
(4) Limitations on using limited excerpts of legally
acquired content for purposes such as criticism, comment,
news reporting, teaching, scholarship, or research.
(5) Limitations on engaging in the secondhand transfer or
sale of legally acquired content to another consumer,
provided that the transferor does not retain the content or
any copy thereof and that the transferee obtains only such
rights to the use and enjoyment of
[[Page S4328]]
the content as the transferor possessed at the time of
transfer.
(d) Exception to Disclosure Requirement.--The Federal Trade
Commission shall not require disclosure under subsection (b)
with respect to any limitation that applies only to uses--
(1) that are sufficiently unusual or uncommon that the
burdens of prior disclosure would outweigh the utility to
consumers; or
(2) that have no significant application for lawful
purposes.
(e) Annual FTC Review.--On an annual basis, the Federal
Trade Commission shall review the effectiveness of its rules
implementing this section to determine whether revisions are
warranted to serve the purposes of this section. In
conducting this review, the Commission shall consider whether
changes in technology or in consumer practices have led to
new, legitimate consumer expectations concerning specific
uses of digital information or entertainment content that
would result in consumers suffering unfair surprise if a
technology were to limit those uses without prior notice.
SEC. 4. EFFECT ON OTHER LAWS.
(a) No Limiting Effect on Fair Use.--Nothing in this Act
shall be interpreted to suggest that a consumer activity not
referred to in section 3(c) or in the Federal Trade
Commission's rules implementing this Act may not constitute a
fair use within the meaning of section 107 of title 17,
United States Code.
(b) Unlawful Reproduction or Distribution.--Nothing in this
Act shall be interpreted to permit the otherwise unlawful
reproduction or distribution of copyrighted content or to
shield a person engaging in such activity from any type of
legal action or judgment.
SEC. 5. COMPETITION IN DISTRIBUTION CHANNELS.
It is the sense of Congress that--
(1) competition among distribution outlets and methods
generally benefits consumers; and
(2) just as copyright holders have sold content embodied in
tangible products such as audio cassettes, videotapes, and
compact discs to multiple competing retail distributors,
copyright holders selling digital content in electronic form
for distribution over the Internet should offer to license
such content to multiple unaffiliated distributors, to enable
competition among different distribution models and
technologies.
______