Statement on the “Audio Flag” Provisions of the “Communications, Consumers’ Choice, and Broadband Deployment”

Washington, D.C., June 22, 2006—Among the provisions in the "Communications, Consumers’ Choice, and Broadband Deployment Act" being marked up in the Senate Commerce Committee is authorization for the Federal Communications Commission (FCC) to “promulgate regulations governing the distribution of audio content.”

In today’s abundance of free speech and broadband proliferation, now is the time to scale back FCC in this and many other areas, not expand its role.

That bit of language is aimed at handheld, portable satellite radio devices from XM and Sirius capable of recording songs. It doesn’t ban the new devices, but it sets the stage for significant regulation of the ability of these, and future, devices to make private copies of digital content. These devices, given earlier legislation called the Audio Home Recording Act, do not feature a "digital out" enabling easy Internet piracy—so they aren’t a new "Napster" or "Kazaa," enabling widespread infringement.

In the extraordinarily complex debate over copy protection and intellectual property rights, efforts to ban devices capable of sound recording and playback are not new. Many new recording technologies, like the VCR, have been fought.

Ultimately, both sides may support compulsory licensing reform for tomorrow’s content, that which has yet to be created.

Yet in a sense, we don’t have an intellectual property problem, we have a compulsory licensing problem. The recording industry must honor compulsory licenses that allow broadcasters to distribute content for regulated fees, engendering endless he said/she said fights over whether the proper government-set licensing fee was paid. Ultimately, both sides may support compulsory licensing reform for tomorrow’s content, that which has yet to be created. It is not a natural state of affairs that the people who create entertainment are at war with their partners who enable playback. Price controls, in the form of compulsory licenses, often create that artificial dilemma.

But whatever the answer is, and whatever we do about protecting artist’s legitimate legal rights, the answer cannot be to ban technological capabilities.

Bans on devices are bans on "engineering free speech," so to speak; such bans are no more legitimate than bans on the kind of free speech the entertainment industry normally fights to defend.

Creating a device capable of recording digital content is itself a type of free speech, and indeed, is itself an exercise of intellectual property rights. If Congress is attempting to sacrifice one in order to save the other, it is doing something wrong; we can’t reasonably uphold intellectual property rights for entertainment, yet deny them for engineering.

The new devices feature no digital out; we can be sure that new forms of entertainment will emerge that the content industry will profit from. Let’s hold off on granting this worrisome new FCC authority, and instead, take a breath, and consider new options more appropriate to a digital world—up to an including rethinking the very legitimacy of compulsory licenses for content created in the future.