DRM in a Budget Bill? Groups Discourage Congress from Requiring Broadcast Flag Technology

Samuelson Law, Technology & Public Policy Clinic, September 25, 2005

Abstract: Consumer Federation of America, Consumers Union, and Public Knowledge have asked Congress not to give the FCC authority to require that receivers of digitally broadcast content be able to screen for a “broadcast flag,” which is a digital code in the broadcast signal that prevents its content from being redistributed to other devices or the internet. The FCC had imposed such a requirement, but it was struck down by a federal court as beyond the agency’s jurisdiction. The consumer groups worry that allowing a requirement of broadcast flag technology would give the FCC unprecedented authority and harm consumers; they also argue it is unnecessary given the tools copyright owners already have to protect their works.

On September 19, three consumer groups submitted a letter to Congress asking that a provision creating “broadcast flag” requirements not be lumped in with upcoming budget bills, but that the issue instead be given full consideration in a Congressional hearing before any action is taken.

The letter was sent by the Consumer Federation of America, Consumers Union, and Public Knowledge and is the latest move in an ongoing battle over whether broadcast flag technology can be used to limit the redistribution of digital content. A “broadcast flag” is a digital code in a broadcast digital TV signal that prevents digital reception equipment such as TV sets, computers, or other devices from redistributing the flagged content to other devices or the internet.

In November 2003, the Federal Communications Commission (FCC) issued regulations that required devices such as digital TVs, computers, and other devices to have broadcast flag-recognition technology. The rule aimed to prevent copyright infringement, but some individuals and groups were concerned that it would also prevent legal uses of the digital content under the “fair use” exception.

According to the Electronic Frontier Foundation (EFF), some examples of activities that the broadcast flags would have prevented are burning a recording digitally to a DVD to save hard drive space, and sending a recording over your home network to another TV. In addition, broadcast flags could reduce the quality of recordings, so that a program originally broadcast in high-definition would only be able to be recorded at standard TV resolution. Finally, new video recorders would not be compatible with existing DVD players.

Several organizations, including The American Library Association and Public Knowledge, challenged the FCC’s broadcast flag order in federal court. They noted that the broadcast flag only affects receiver devices after broadcast transmission is complete, and that the FCC does not have the authority to regulate content after completion of a broadcast transmission.

In May 2005, the D.C. Circuit Court of Appeals agreed, holding the FCC broadcast flag regulations to be invalid because the agency did not have jurisdiction to issue rules governing content after it is broadcast. American Library Ass'n. v. F.C.C.. The court found that the FCC may regulate “apparatus that can receive television broadcast content, but only while those apparatus are engaged in the process of receiving a television broadcast.” 406 F.3d 689, 692. Because the broadcast flag has no effect until after the transmission is complete, it was not within the FCC’s jurisdiction.

Thus, in order for the FCC to issue such broadcast flag regulations, Congress would have to change the agency’s jurisdiction and authorize it to govern devices after content transmission is complete. In June the EFF reported rumors that a provision making this change would be snuck into an appropriations bill. Congressional appropriations bills are extremely large and complex, so members of Congress may be less likely to notice or give much consideration to a provision inserted in this way, and they may be reluctant to hold up passage of the entire appropriations bill on this single issue, even if they disagree with the provision.

The September 2005 letter outlines three reasons that Congress should not insert the broadcast flag requirements into an appropriations bill, but instead should hold a hearing to fully consider such a provision:

First, the regulations would give the FCC unprecedented control over technology: “By imposing government-agency control over the design of digital electronics and, potentially, over computer operating systems and other software, the scheme will inevitably slow or stifle the development of innovative consumer electronics and other products.”

Second, the regulations are superfluous in light of the content-protection tools the content industry now has: “The passage of the Artists Rights and Theft Prevention (ART) Act, along with the U.S. Supreme Court’s decision in the MGM v. Grokster case are only the most recent additions to the legal solutions the content industry has at its disposal.”

Third, the regulations would harm consumers and educators by creating a compatibility nightmare: “Because the flag-compliant technologies the FCC approved are not designed to work with each other, consumers will have to make certain that all of their devices use the same content-protection technology.”

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