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Remarks As Prepared
For Delivery by
Edgar Bronfman, Jr.
Real Conference 2000
San Jose, California
May 26, 2000

Thank you and good morning. I'm very happy to be here and to witness first hand the mission upon which Rob, his colleagues at Real and Real's partners have embarked. That mission is vitally important to better serve a world hungry for information and entertainment.

In partnering with Universal, a company dedicated to delivering entertainment to consumers everywhere, including via the Internet, we have together committed to creating a top-quality consumer experience in which the content delivered is completely secure.

That work will be the bedrock on which huge creative and industrial efforts will be based.

In the next few minutes, I'd like to focus on some critical issues that I believe to be central to the continued operation and expansion of the Internet. New technologies are creating tremendous opportunities for businesses and consumers.

But, like many innovations throughout history, today's digital technologies are, at the same time, spawning serious and fundamental challenges.

While I'll touch on the opportunities that lie ahead for all of us - and they are without question immense - I want to sound a different note at this conference by addressing the challenges. Specifically, combating the dangerous and misguided notion that property is not property if it's on the Web, and the piracy that that notion perpetuates.

In addition, I want to discuss the very real difference between privacy and anonymity. In the blurred vision of speed and innovation, those two quite separate values have become indistinct, and that lack of distinction is currently having - and will continue to have - a deleterious effect on our culture, our society and the long-term growth of the Internet.

Clearly, in this New World of technology built upon technology, opportunities abound.

If the past is prologue, then the advent of new technologies has much to offer both the creators of entertainment and those who enjoy and consume it.

And the repercussions of this current technological revolution will dwarf the changes that were brought about by previous advances. We now live in an era in which a few clicks of your mouse will make it possible for you to summon every book ever written in any language, every movie ever made, every television show ever produced, and every piece of music ever recorded.

Music is on the leading edge of this revolution, and because of that, it has become the first product to illuminate the central - and I believe the most critical - challenge for this technological revolution: The protection of "intellectual property rights."

For all of us, "property" rights are well understood and universally accepted. You own a home. You own a car. They're yours - they belong to you. They are your property. Well, your ideas belong to you, too. And "intellectual property" is property, period.

But there are those who believe that because technology can access property and appropriate it, then somehow that which is yours is no longer yours -because technology has made it simple and easy for someone else to take it from you.

If intellectual property is not protected - across the board, in every case, with no exceptions and no sophistry about a changing world - what will happen? Intellectual property will suffer the fate of the buffalo.

For the great ferment of works and ideas, including your own, if taken at will and without restraint, have no chance of surviving any better than did the buffalo.

And why is this important? Because you, like we in the entertainment business, are thoroughly dependent on patents and copyright. You need them no less than we do, to protect your processes, your conceptions, your software code, your procedures, your designs, your ideas.

My central belief that the protection of intellectual property rights is vital to the prosperity of the Internet, and my assertion that "you need them no less than we do," illuminate my purpose in making this address: The Internet does not exist, and cannot prosper in a world that is separate from our civilized society and the fundamental laws upon which it is based.

So am I warring against the culture of the Internet, threatening to depopulate Silicon Valley as I move a Roman legion or two of Wall Street lawyers to litigate in Bellevue and San Jose? I have moved those lawyers - or some of them - but I have done so, and will continue to do so - not to attack the Internet and its culture but for its benefit and to protect it. For its benefit.

What would the Internet be without "content?" It would be a valueless collection of silent machines with gray screens. It would be the electronic equivalent of a marine desert - lovely elements, nice colors, no life. It would be nothing.

The main challenge for you in continuing the growth of the Internet at this time is not taxation; it is not government regulation; it is not in any way technical. It is, rather, to manage, preserve and protect the sun around which all these planets make their stately circles.

That sun is not an operating system or even the greater-than-the-sum-of-its-parts Internet itself: It is the content, without which the Internet would die in a day.

The main challenge for my colleagues and me is really the same - for your interests and ours are not separate, they are closely, inextricably linked.

And so I will, as the leader of one of the world's foremost content companies, fight to preserve the creativity and the genius of creators everywhere, including the ones in this room.

Right now, Universal is engaging in five areas in order to defend and promote the works of the great talents with whom we are privileged to be associated.

First, we are focused on creating and launching a consumer-preferred and legal system for consumers to access the media they desire - beginning with music.

We will launch a secure downloading format later this summer that will be the start of making our content widely available in digital form.

We want downloadable music to be easy to find, and its delivery to be fast, convenient, dependable and secure. That's why we've partnered with Real, Magex and InterTrust Technologies.

And the multi-media product we will launch will be more than just music.

We are providing artists with a broader canvas on which to express themselves, and we are creating a far richer experience for the consumer. For example, consumers will have access to album art, lyrics, production notes and photos of the artists, links to other sites and, eventually, music videos. We'll also offer the chance for them to chat on line with artists.

And because of the security our product will offer, consumers' privacy will also benefit because their files and their systems won't be corrupted.

In addition to this product and system we've developed, earlier this month, Universal Music and Sony Music announced a joint venture to develop subscription-based services that will include music and video offerings across every possible platform.

We are very aware of the intense and the vast demand that exists on the part of music lovers to find the music they want, when they want it, where they want it, all the time. And we are responding by delivering competitive - and legal - systems for them to do so.

Second, we know that going into a record store and removing a CD is wrong. It is stealing. It is thievery.

We will re-emphasize this truth and articulate this message in an educational effort, with our industry allies, targeted to the great majority of people who want to do the right thing - yet, may not fully comprehend that accessing copyrighted material without proper payment or permission in the digital world, is as wrong as it is in the physical world.

Each new technological advance inevitably requires new behaviors. When tape recorders came along, we grappled with the distinctions to be made between taping things for your own enjoyment and selling the tapes. When photocopiers came along, we had to deal with how much of something could be copied and under what circumstances without constituting theft.

Now the Internet has created a newer version of the same issues. Once again, we need to thrash out how intellectual property can and should be protected in the context of new, digital technologies.

The Internet world is a brave new world. But make no mistake, it could only have been created and it will only survive, in the context of our civilized world, which has taken humanity centuries to construct.

This technological revolution will reshape it - perhaps even more dramatically than the Industrial Revolution reshaped its world. But the principles of law, of justice and of civilization will not be overturned. If the Internet requires these basic principles to be sacrificed so that it may prosper, it will wither and die like the Hantavirus, which expires as it devours the very life that would sustain it.

Universal's third initiative is the use of technology. Just as technology gives, so can it take away. As technology enables crime, so can it be used to protect us from crime and criminals.

We have available to us growing arsenals of technological weapons that will be brought to bear on inappropriate access to material on the Internet.

Whether it is better and more robust methods of security, or tools to track down those who ignore right from wrong, technology will offer the owners of property at least as much comfort as it may currently offer to hackers and spies, pirates and pedophiles.

Technology exists that can trace every Internet download and tag every file. These tools make it possible to identify those who are using the Internet to improperly and illegally acquire music and other copyrighted information. While adhering to the principle of respect for individual privacy, we fully intend to exploit technology to protect the property which rightfully belongs to its owners.

The fourth route we have already pursued is to utilize existing laws to bring to justice those who demonstrate contempt for law and copyright, and seek to profit from that which is not lawfully theirs.

Here, we have already seen some major successes:

  • In late April, a U.S. District Court for the Southern District of New York ruled that myMP3.com was liable for copyright infringement.
  • In mid-May, the U.S. District Court in Northern California ruled against Napster. The court denied Napster's claim that it was a mere conduit, and the court determined that Napster had not taken adequate steps to keep repeat infringers, who use pirated material, from using the site.
  • Another recent victory confirming the application of copyright law to cyberspace involved the unlawful dissemination of DVD anti-copy codes.
  • A fourth case involving the retransmission of television signals over the Internet resulted in a clear-cut victory for copyright holders. The judge in this case enjoined iCraveTV from re-transmitting broadcast signals via the Web from Canada.

These four court rulings illustrate the legal process that is defining the boundaries of right and wrong as intellectual property rights are applied to a new technological era.

All of us who believe in the right to own property, and therefore in the sanctity of copyright, will be fiercely aggressive in this area. We will fight for our rights and those of our artists, whose work, whose creations, whose property are being stolen and exploited. We will take our fight to every territory, in every court in every venue, wherever our fundamental rights are being assaulted and attacked.

Let me now turn to my fifth point. We must restrict the anonymity behind which people hide to commit crimes. Anonymity must not be equated with privacy. As citizens, we have a right to privacy. We have no such right to anonymity.

Privacy is getting your e-mail address taken off of "spam" mailing lists; privacy is making sure some hacker doesn't have access to your social security number or your mother's maiden name. On line, privacy is assuring that what you do, so long as it is legal, is your own business and may not be exploited by others.

Anonymity, on the other hand, means being able to get away with stealing, or hacking, or disseminating illegal material on the Internet - and presuming the right that nobody should know who you are. There is no such right. This is nothing more than the digital equivalent of putting on a ski mask when you rob a bank.

Anonymity, disguised as privacy, is still anonymity, and it must not be used to strip others of their rights, including their right to privacy or their property rights. We need to create a standard that balances one's right to privacy with the need to restrict anonymity, which shelters illegal activity.

We cannot suggest that the ready and appropriate distinctions we make between privacy and anonymity in the physical world are irrelevant in the digital world. To do so would be to countenance anarchy. To do so would undermine the very basis of our civilized society.

In the appropriation of intellectual property, myMP3.com, Napster, and Gnutella (which has stolen from the breakfasts of 100 million European children even its name) are, in my opinion, the ringleaders, the exemplars of theft, of piracy, of the illegal and willful appropriation of someone else's property.

What individuals might do unthinkingly for pleasure, in my view, they do with forethought for profit, justifying with weak and untenable rationale their theft of the labor and genius of others.

They rationalize what they do with a disingenuous appeal to utopianism: Everything on the Internet should be free.

Other than the gifts of God and Nature, that which is free is free only because someone else has paid for it. What of the extraordinary gifts of software and whole operating systems of which we sometimes read?

They are rare, and sometimes they are loss leaders. Some of the donors may regret their generosity when later they are confronted with their children's college tuition and orthodontic bills, but yes, they have given, and they have given freely.

There is a difference, however, between giving and taking. Had those donors been compelled to do what they have done, it would be a tale not of generosity but of coercion, not of liberality but of servitude. Those whose intellectual property is simply appropriated on the Internet or anywhere else, are forced to labor without choice or recompense, for the benefit of whoever might wish to take a piece of their hide.

If this is a principle of the New World, it is suspiciously like the Old World principle called slavery.

It is against this that we have initiated legal action. It is not, and will not be, because we wish to suppress ingenious methods by which our products may be delivered, but because we wish to maintain rightful control and receive fair compensation.

The massive power of the Internet can permanently wipe out and shut down in one unthinking moment, a writer who may depend for his living on the sale of 5 or 10 thousand copies of his book. It can devastate a musician who sells a few thousand copies of a homemade CD to his fans in some small and little known community.

And these would only be the first casualties. The rest would follow as the very basis of the New Economy was undermined.

Undermined - by whom?

Well, not by most people, who have stated in overwhelming majorities time and again that they would be perfectly happy to pay a fair price for what they receive, but by a very small segment who would profit by cultivating and taking advantage of each person's least admirable qualities.

And while it is often true that ambiguity exists at the core of a controversy, here, however, is perhaps the clearest exception to date to that general rule of ambiguity, for the dangers are obvious, the issues familiar, the principles long established and for good reason.

To those who would abandon or subvert those principles, I say we are right with the Constitution, in which protection for intellectual property is founded; right with the common law; right with precedent and right with what is fair and just.

But being fair, or being just, in a battle for survival is often not enough.

World War II was won by the Allied forces, not only because we were right, but also because we had more men and women, more weaponry and more money, and that money in turn would train more men and women and build more weaponry.

But being fair, and being just, is what allowed our civilized society to survive and prosper, while that of our conquering ally, the Soviet Union, cracked, crumbled and collapsed because it attempted to perpetuate a society that was fundamentally unjust, and unfair.

And if the Internet should require an unjust and unfair paradigm in order to perpetuate itself, then it too will crack, crumble and collapse, and it won't take five decades of Cold War politics for it happen.

That is why it is in your interest to join our fight to protect and defend the property rights of creators everywhere. And that is why we are bringing our fight to the court of justice and to the court of public opinion.

We will fight our battle in the marketplace as well, by bringing our products to consumers with innovative, legal, consumer-preferred solutions. And we will work with the research laboratories of technology companies throughout the world, so that we may better protect our property and promote our purpose.

Let this be our notice then to all those who hold fairness in contempt, who devalue and demean the labor and genius of others, that because we have considered our actions well and because we are followers without reticence of a clear and just principle, we will not retreat.

For in the end, this is not only a fight about the protection of music or movies, software code or video games. Nor is it a fight about technology's promise or its limitations. This is, at its core, quite simply about right and wrong.

Thank you for letting me speak from the heart.

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