Mr. Jack Valenti
President and Chief Executive Officer
Motion Picture Association of America
1600 Eye Street, NW
Washington, DC, 20006

H.R. 107, The Digital Media Consumers' Rights Act of 2003
Subcommittee on Commerce, Trade, and Consumer Protection
May 12, 2004
10:00 AM


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WHY H.R. 107 IS A PRIME HAZARD TO THE FUTURE OF AMERICAN INTELLECTUAL PROPERTY

1. H.R. 107 has one unfixable defect: It will legalize the hacking of copy protection measures, which in turn will make it impossible to truly protect valuable creative property.

We must remember that tapes copied on a VCR become progressively unwatchable after the first few generations. Not so in the digital format. The 1000th copy of a digital movie or piece of computer software is as pure and pristine as the original.

If H.R. 107 becomes law, it then becomes legal to sell machines that circumvent, or hack, the copy protections on a movie, whether distributed as a DVD or online, so long as the device is "capable of enabling significant noninfringing use of the copyright work." This would devastate the home sale market, as anyone could use these products to "rent, rip, and return" DVDs borrowed from video stores. In addition, it will greatly diminish the incentive for investment in new and innovative distribution mechanisms for digital content, such as distributing movies online. All legitimate digital distribution of movies depends on encryption and digital rights management technologies to control unbridled distribution. If breaking this encryption is legalized, why would movie studios invest in the infrastructure to deliver their products digitally when devices to strip the content of protection are legal and commonplace?

2. Keep in mind that, once copy protection is circumvented, there is no known technology that can limit the number of copies that can be produced from the original. In a recent symposium on the DMCA, Professor Samuelson of UC Berkeley posed the question: "whether it was possible to develop technologies that would allow…circumvention for fair uses without opening up the Pandora's Box so that allowing these technologies means that you're essentially repealing the anti-circumvention laws."

The question was answered by the prominent computer scientist and outspoken opponent of the DMCA, Professor Ed Felton of Princeton: "I think this is one of the most important technical questions surrounding DRM - whether we know, whether we can figure out how to accommodate fair use and other lawful use without opening up a big loophole. The answer, I think, right now, is that we don't know how to do that. Not effectively."

Moreover, there is no known device that can distinguish between a "fair use" circumvention and an infringing one. Allowing copy protection measures to be circumvented will inevitably result in allowing anyone to make hundreds of copies - thousands - thereby devastating the home video market for movies. Some 40 percent of all revenues to the movie studios come from home video. If this marketplace decays, it will cripple the ability of copyright owners to retrieve their investment, and result in fewer and less interesting choices at the movie theater.

3. It is important for the Congress to understand that intellectual property is America's greatest export prize which comprises more than five percent of the GDP - brings in more international revenues than agriculture, aircraft, automobiles and auto parts - and is creating NEW jobs at three times the rate of the rest of the economy. Why is it in the national interest to put to risk this engine of economic growth? Why?

4. Moreover if Congress creates this enormous loophole in the DMCA by passing H.R. 107, every nation in the world will immediately revise its own copyright rules to do the same. American intellectual property protections will be un-done, not only here but around the world. Why should other countries protect our property in their land if we don't do the same here?

5. H.R. 107 language was proposed in 1998 and was soundly defeated by the Congress.

My colleagues from the Business Software Alliance and the Recording Industry Association of America will elaborate on a number of these points. They will also talk about the "labelling" requirements proposed by the bill, and I want to make sure that the MPAA is clear that we support voluntary, not mandatory labelling. I want to focus the remainder of my testimony on one of the underlying issues driving this debate at this time: the issue of "back-up copies."

There are three reasons why the legislation to permit "backing up" DVDs is unsuitable for passage. Making back-up copies of DVDs:

" Is not legal.

" Is not necessary.

" And allows "hacking" of encrypted creative material, which in turn puts to peril the future home video market.

First, back-up copies are not legal. The Copyright Act does NOT say "buy one movie, get one free." There is no more a "right" to a back-up copy of a DVD than a back-up DVD player, lawn mower or set of wine glasses. (Indeed, Congress included language in the DMCA that mandated that VCRs include technology to block the copying of prerecorded movies.) What H.R. 107 really says is "it's okay to make extra copies, and it's okay to circumvent encryption to do it."

Second, and more fundamentally, back-up copies of DVDs are not necessary. As said earlier, an encrypted DVD is well nigh indestructible. Most people I know, and I include myself, take a favorite DVD with them when they travel. It is highly portable. Moreover, an encrypted DVD can be watched over and again, hundreds of times without any degrading of sight, sound and color. And if by some very rare happening a DVD should malfunction, another can be bought at ever-lowering prices.

Let's remind ourselves about what has happened since 1998, when this proposal was last placed before - and rejected by - this Committee and the Congress. What has happened is the most immediately successful innovations in the history of how we as a nation enjoy audio-visual entertainment. The American consumer has adopted the encrypted DVD faster and more completely than any previous new consumer electronics product. This DVD revolution has been the key fact of life for making the American movie industry so hospitably received in countries all over the world.

The Copyright Office looked at this entire issue in great detail in last year's DMCA rulemaking proceeding and, for the second time since the DMCA was enacted, denied an exemption for making backup copies of DVDs. Their analysis is correct. There's no reason to reverse the course the Congress set in 1998: to bring the benefits of digital dissemination of copyrighted materials to the American consumer by encouraging the use of technological controls on access and use of those materials.

As you are aware, "321," before being enjoined by two federal courts from carrying on its illegal business, was one of the leading purveyors of hacking technology targeting our DVDs. 321's machines automatically labelled the copy of the DVD "for back-up use only." Yet our investigators and law enforcement officials have found unauthorized copies with that very label being sold in the pirate marketplace.

We return to this one incontrovertible point: there is no way to know, at the moment that protection is stripped away, what use will be made of the resulting immaculate but unauthorized copy. Once the hacker has done his work, the protection is gone forever. The adverse impact of the hacking on the men and women who have invested their time, toil and talent to make the movie in question could be minimal - but it could equally be monumental. There is simply no way of telling in advance.

So let's be frank about the impact of enacting H.R. 107. This is not just about facilitating back-up copies, illegal and unnecessary though they may be. It's not even about enabling consumers to make their own extra copies, rather than to pay for them in the normal channels of commerce. It's about opening a Pandora's Box that our present technological capabilities are powerless to close.

Let me address one final point. This discussion has been about DVDs. But looming much larger is the issue of digital distribution.

Today our ability to digitally distribute movies legally - and the pirates' ability to digitally distribute them illegally - is subject to limits of speed. But there are experiments now going on that will reshape and enlarge the ease and speed of delivery. Cal Tech reported one experiment called "FAST," which can download a quality DVD movie in five seconds! Another experiment, "Internet-2," has dispatched 6.7 gigabytes halfway around the world in one minute! (An uncompressed DVD-movie contains some 4.6 gigabytes.)

With this kind of lightning-fast speeds just around the corner, our dream and our plan is to develop digital distribution systems that will allow you to select and watch any movie ever made from the comfort of your own home. Consumer-friendly choices are promoted by providing consumers with legitimate market-driven alternatives for renting, purchasing or even copying. But these options will never come to pass if the circumvention of technology that provides these consumer choices is legalized by this legislation.

Development of these options all depend on copy protection - encryption schemes - and digital rights management to work. Under H.R. 107, someone will legally be able to develop, manufacture, sell, and use hacking tools. There is no point investing in expensive technologies to safely distribute our products digitally if we know that in moments they will be stripped of their protection. If this bill is enacted, the digital dream will turn into a digital nightmare.

H.R. 107 is not just bad for copyright owners; it's bad for consumers. We urge that this bill be rejected.

http://energycommerce.house.gov/108/Hearings/05122004hearing1265/Valenti1987.htm

Ten reasons for wondering about Jack...

Assorted Facts:
1)Mr. Valenti avoided wearing the long black cape with standup collar
2) It is my understanding that there were no mirrors allowed to be brought
in to the hearing area
3) I do not believe garlic necklaces were allowed in during Mr. Valenti's testimony
4) No one named Van Helsing was allowed near Mr. Valenti at the hearing.
5) I do not think natural sunlight was allowed in the hearing room.
6) I never saw Mr. Valenti eating normal human food on camera.
7) Technically, Mr. Valenti is a member of the "undead"
No one has yet proven that he is incapable of turning into a bat if he wishes
9) No one has ever seen Count Dracula and Valenti together at the same time
10) Jack Valenti compared VCR's relationship to the movies, to the Boston Strangler to a single woman alone...and one has to admit, this is a very creepy and bizarre way of coming up with an analogy!

I saw Jack in the CSPAN hearings to consider censoring smoking in films.

That debate aside, on which I have no opinion---

he fell asleep. And jerked awake when questioned on something..

Lessig's is on a panel today at Harvard, here's his comments:

"I testified Wednesday about HR 107 (DMCRA). It says tech can't block
non-infringing uses. Seems a totally obvious, simple point. Insane
amount of ignorance inside Congress. Q: What fair use means. Can I back
up my DVD. No. I say, "Hey wait -- this isn't the issue. Whatever fair
use is, isn't part of this bill!" I was lectured at with a kind of IP
McArthyism -- "copyright is the same thing as dirt." No difference. It's
property. I responded, "You're right. Copyright is a form of property.
That's irrelevant." All Congress could focus on was that property is
important, we must protect it. They just didn't get it."

Why won't all these people just die the painful death they deserve so they can see what God thinks about thier crusade for copyrights and copy protections.

Too bad us pirates already have the access to speeds that can distribute FULL DVDS in the matter of minutes. Not quite 5 seconds yet, but a true topsite proclaiming 1GBPS connection could do a full dvd in about 90 seconds =o

There are three reasons why the legislation to permit "backing up" DVDs is unsuitable for passage. Making back-up copies of DVDs:

" Is not legal: Jack its illegal if I was to produce mass copies and give them away to friends and strangers regardless of whether or not I seeking to gain profit from it. Clean the crusted shit from ur ass bub!
Is not necessary: Not necessary I do the best I can to safeguard my DVD's but I have plenty siblings around and having a backup copy is nice just to assure that ur hard earned money didnt go to waste. Kids are inquisitive they will do anything to find what they want"

And allows "hacking" of encrypted creative material, which in turn puts to peril the future home video market: Jack, u said that same thing years ago wit the VCR...anyone remember the Boston Strangler I think he raped Jack!

My best advice is to stop worrying just be on guard and u will see the money flowing!

I love his whole notion that fair use should be constrained by degrading quality and inevidably unwatchable.

I think I know what old Jack (Hack) problem is?????? Old Jack is BACKED UP!!!!!!!!!!!!!!!!

Well, couldn't they just create copying software that allows for no more than 5 backups? Hmmmm? If iTunes will only let you burn the same identical playlist 10 times, then can't they make something that'll only let you copy the same movie 5 times and no more?

What's this "not necessary" stuff? Good God, doesn't the man realize that one scratch can screw a DVD over forever? And what's this "a new copy can be purchased at ever lowering prices" bull? Apparently the man spends so much time in his tomb that he doesn't realize that certain companies *cough*Disney*cough* only release their DVDs for limited times, then put them back in their "vault" for 10-15 years at which time they rerelease them in a completely changed way (such as they did with the DVD-release of The Lion King).

"nigh on destructible"? I think not. Like I said, all it takes is one scratch, one tiny, unseen scratch to make a DVD unplayable. And we all know how children treat things like DVDs.

"high portable"? Yeah, if you have the $700 for a portable DVD player, which the large majority of Americans do not. What, are we now to go out and spend this money on these portable players, or plunk down large sums of money to install video systems in our cars so that we all can join the sainted ones in taking our DVDs everywhere we go.

Hack mentions distribution systems. I believe we already have this. It's called OnDemand and I believe (at least where I live) it's currently offered by Time Warner Cable. For $60 a month, you can watch a movie on HBO, Cinemax or Pay-Per-View whenever you want. Of course, it's only on your TV in your home.

And let us not forget that Hacks vision of an online distribution system calls for the total abolishment of physical DVDs to be replaced by movies that stop playing after three days forcing you to "re-rent" the same movie for another three days. Sorry, Hack, but I like to be able to watch my movies whenever I want and only pay a one-time fee. It's called a purchase. Maybe you've heard of it. It's where I pay a certain amount of money (usually between $10-$20 where I live) for this disc which contains my movie and I take it home and watch it. Satisfied, I place the disc back in its case and put it on a shelf, next to the other discs I have purchased. A few weeks, or months, sometimes years later I decide to watch that movie again. Thus, I take the movie off the shelf, remove the disc from its case and place it in the player. I do that for free.

This guy gives movies a bad name, not to mention he is creepy when you look at him.

"The American consumer has adopted the encrypted DVD faster and more completely than any previous new consumer electronics product. This DVD revolution has been the key fact of life for making the American movie industry so hospitably received in countries all over the world."

Uhh...the American consumer adopted the DVD NOT because of the copyright protections, stupid, they did it because they finally have gotten a product that is as cheap or cheaper than a CD of music, and players are dirt cheap as well, and unless it gets damaged doesn't start self destruction the moment you start using it (i.e. VHS tapes). The DMCA did not cause this to happen, a lot of hard work by engineers and innovators well before 1998 made this happen.

The reason it's been adopted so well overseas is because the DVD dupe shops are running full swing and are selling them for pennies, mainly because the countries are so poor. $15 US is a half a months salary in most of these countries. Who's gonna pay that when they have to eat!!!

what a idiot . let them lock it up and throw away the key we can still get around any drm they want to spend thier money on like i cant get any movie i want already. all its gonna do is make shit unplayable for the average mom and pop consumer. by the way jack i dont think you are gonna make the technology to download movies in a minute its going to be the isp that i pay my money to for the speed i want . they will make the infrastucture for it when it looks like the internet is gonna grom not by putting a noose around the neck of consumers with drm and lawsuits. as it is im about ready to go back to dialup since i rarely download anymore and the 1000's of movies and 60.000 + mp3's i have should keep me busy for a good long time and i share my files from portable drives by usb not p2p now lol and know alot of people doing the same . you talk about good download rates buddy hehehe

"If breaking this encryption is legalized, why would movie studios invest in the infrastructure to deliver their products digitally when devices to strip the content of protection are legal and commonplace?"

Apparently Jack has never heard of Microsoft.
What a maroon.

"Some 40 percent of all revenues to the movie studios come from home video."

None of which would exist if YOU had been successful in banning the VCR. So just shut the fuck up already.

"Why is it in the national interest to put to risk this engine of economic growth? Why?"

The engine is old, broken, leaks oil, burns way too much gas and costs WAY more than it's worth.

"There are three reasons why the legislation to permit "backing up" DVDs is unsuitable for passage. Making back-up copies of DVDs:

" Is not legal.

" Is not necessary.

" And allows "hacking" of encrypted creative material, which in turn puts to peril the future home video market."

It is not legal because you PAID Orrin Hatch to introduce a law your lawyers wrote. So fuck you.

It IS necessary for several reasons.

If anyone has 'put to peril' the home video market, it is you. asshole. VCRs wouldn't exist if you had your way.

FOAD.

"We return to this one incontrovertible point: there is no way to know, at the moment that protection is stripped away, what use will be made of the resulting immaculate but unauthorized copy. Once the hacker has done his work, the protection is gone forever. The adverse impact of the hacking on the men and women who have invested their time, toil and talent to make the movie in question could be minimal - but it could equally be monumental. There is simply no way of telling in advance."

Bullshit.
Name a single movie where the 'help' would be paid MORE if the movie wasn't available on P2P in DIVX. The only 'adverse impact' is to your perceived, and grossly overestimated bottom line. FOAD.

"There is no point investing in expensive technologies to safely distribute our products digitally if we know that in moments they will be stripped of their protection. "

Then don't.

Every current form of DRM has been broken. Whether it's legal in the USA or not, there will always be software readily available to do it. Why don't you RIAA people start making good music? I haven't heard any in a long time.

...something WORTH paying for.

Code, your "assorted facts" about Jack were extremely amusing. You know "Jack"!

My suggestion to Mr. Valenti,

Go back to VHS tapes and we'll record our own DVD's.

Here Here I say the same thing go back to VCR

DVDs are most certainly NOT indestructable...they are actually quite fragile. Hell, I'm even noticing a lot of rentals are locking up in my players due to tiny scratches.
It doesn't take much.

There are three reasons why the legislation to permit "backing up" DVDs is unsuitable for passage. Making back-up copies of DVDs:

" Is not legal.

" Is not necessary.

" And allows "hacking" of encrypted creative material, which in turn puts to peril the future home video market.

First, back-up copies are not legal. The Copyright Act does NOT say "buy one movie, get one free." There is no more a "right" to a back-up copy of a DVD than a back-up DVD player, lawn mower or set of wine glasses. (Indeed, Congress included language in the DMCA that mandated that VCRs include technology to block the copying of prerecorded movies.) What H.R. 107 really says is "it's okay to make extra copies, and it's okay to circumvent encryption to do it."

Second, and more fundamentally, back-up copies of DVDs are not necessary. As said earlier, an encrypted DVD is well nigh indestructible. Most people I know, and I include myself, take a favorite DVD with them when they travel. It is highly portable. Moreover, an encrypted DVD can be watched over and again, hundreds of times without any degrading of sight, sound and color. And if by some very rare happening a DVD should malfunction, another can be bought at ever-lowering prices.


What BULL!!! You can just feel the greed in his words!

And if by some very rare happening a DVD should malfunction, another can be bought at ever-lowering prices.

The problem with these CLOWNS is that they want the consumers to keep buying their product over and over again. I for one will not do that. DVD's are fragile. My daughter likes to take them out of their case and try and insert them in the DVD player. She gets scratches on them. We have alot of Disney movies and movies in general. I am NOT going to repurchase the same movies again just to accomodate Hack & Carrie Sue's bank account. If that is what the expect then they are crazy. I will do with my purchased products what I want to. As long as I don't make copies for re-sale then leave me alone old senile coot.

"We must remember that tapes copied on a VCR become progressively unwatchable after the first few generations."

That's funny...I have VHS tapes that are twenty years old. I have a DVD that went south after two years. When do we start gettting the ones that last forever? From articles posted earlier, this media appears to have a pretty limited shelf life. I even read in one of the earlier articles that the record industry itself preserves its library on tape to get the longer shelf life.

Totallyfrust.....

They are referring to making a copy of a copy. Video resolution tends to fade if you do it that way. But, the proper way to do this is to make a copy of the original and use it, while you archive the original. Same method should be used when making any fair use copy of anything.

"We must remember that tapes copied on a VCR become progressively unwatchable after the first few generations."


Obviously, Jack the Hack ain't too technically smart here.

I should not bother even reading this cause I already know it is packed full of lies.

Shmoo, of Electric Gypsy
Support Local and Independent Music!

Jack Valenti saves money by playing the vampires in his movies. No need for an expensive actor and no need for make up either.

Count Jaccula Valenti.

"Count Jaccula". I like that.

You know, Hack speaks about there being no right to a backup lawnmower or wine glasses. Then I guess lots of people break the law by having more than one lawnmower. Backups are just as important no matter what you have.

I guess before long, if Hack and Carey Sue get their way, we'll be prohibited from backup up our personal files and consistently lose them when the RIAA, MPAA or other initial legally destroys our computers (if they get their way, that is) just because we mention a song or movie title that's copyrighted.

Hey...I've got a backup lawnmower...Guess that means I'm violating copyright. According to Hack.

That's not as relevant as the old man would like to think it is. The technology doesn't exist to copy lawnmowers, so it doesn't matter. If you can duplicate the wine someone is selling, then I'm pretty sure you actually ARE allowed to make it in your basement or whatever and drink it when you run out of the original.

Also, lawnmower companies aren't price gouging. Nor are they advertising a lawnmower, but when you get it home it's only 25% of what you expected. Furthermore, they come with warrantees, guarantees, etc.

And in the case of wines, have you ever gone to a restaurant and said you wanted a glass of wine, and they said you must buy the whole bottle? No. You can buy a wine "single." Now on iTunes you can buy a DRMd music single, but will the wine company sue you if you let someone else drink from your glass? No, they won't.

Wow, Jack. You idiot. This is up there with "You're not allowed to buy a car, and then return it if you don't like it." No kidding, but you can test drive it!

Way to make a fool of yourself. If only I was at the hearing.

Another point against the wine statement:
You never "rent" a glass of wine.You go to a restaurant,order the wine in a glass,and drink the wine.The wine may leave your body after a while,but if you don't drink the wine within four minutes of recieving it,the restaurant owner won't come down to your table and tell you that you have to pay twenty dollars for the glass to sit on the table with your wine in it.

And lawn mowers...
Jesus,there's a difference between a solid object and a piece of data.

Try traveling with a region 1 dvd to someone who has a region 2 dvd player like those in Europe. IT WONT FUCKING PLAY.

Highly portable my ass.