Advanced Copyright Issues on the Internet - Fenwick & West LLP

DMCA with respect to the DMCA’s impact on, among other things, “the relationship betweenexisting and emergent technology” and Sections 109 and 117 of the copyright statute. The reportrequired under Section 104 was issued in August of 2001 and is available online atwww.loc.gov/copyright/reports/studies/dmca/dmca_study.html.The report concluded that the making of temporary copies of a work in RAM in thecourse of streaming implicates the reproduction right of the copyright holder so long as thereproduction persists long enough to be perceived, copied, or communicated. 2265 The reportnoted considerable uncertainty in the industry concerning the legal status of buffer copies and theexposure of webcasters to demands for additional royalty payments from the owners of streamedsound recordings. The report expressed the belief “that there is a strong case that the making ofa buffer copy in the course of streaming is a fair use,” based largely on the fact that buffer copiesdo not supersede or supplant the market for the original works and the effect on the actual orpotential market for the works appears to minimal or nonexistent. 2266 Because the sole purposefor making the buffer copies is to permit an activity that is licensed by the copyright owner andfor which the copyright owner receives a performance royalty, the report concluded thatcopyright owners appeared “to be seeking to be paid twice for the same activity.” 2267Accordingly, the report recommended:that Congress enact legislation amending the <strong>Copyright</strong> Act to preclude anyliability arising from the assertion of a copyright owner’s reproduction right withrespect to temporary buffer copies that are incidental to a licensed digitaltransmission of a public performance of a sound recording and any underlyingmusical work.The economic value of licensed streaming is in the public performances of themusical work and the sound recording, both of which are paid for. The buffercopies have no independent economic significance. They are made solely toenable the performance of these works. The uncertainty of the present lawpotentially allows those who administer the reproduction right in musical worksto prevent webcasting from taking place – to the detriment of other copyrightowners, webcasters and consumers alike – or to extract an additional payment thatis not justified by the economic value of the copies at issue. Congressional actionis desirable to remove the uncertainty and to allow the activity that Congresssought to encourage through the adoption of the section 114 webcastingcompulsory license to take place.Although we believe that the fair use defense probably does apply to temporarybuffer copies, this approach is fraught with uncertain application in the courts.This uncertainty, coupled with the apparent willingness of some copyright owners2265 See Section III.B.2.a of the Executive Summary of the report, which may be found online atwww.loc.gov/copyright/reports/studies/dmca/dmca_executive.html.2266 Id. Section III.B.2.b.2267 Id.- 494 -