WASHINGTON, D.C. - Watch out for unintended and potentially dangerous “spill-over effects” that could “undermine the development of efficient markets in digital goods.” That is the warning from a legal and industry expert to the U.S. Copyright Office in its second proceeding under the Digital Millennium Copyright Act’s (“DMCA”) anticircumvention provisions. In the proceeding, the Register of Copyrights will develop recommended ‘classes of works’ that should be exempted from the DMCA’s prohibition on the circumvention of technologies controlling access to copyrighted works.

In official reply comments to the agency, Progress & Freedom Foundation Senior Policy Counsel William F. Adkinson Jr. expresses concern that “an exemption intended to protect noninfringing uses could interfere with effective enforcement directed at infringing uses,” and thereby hinder efforts to reign in Internet piracy. He urges that the Register broadly apply the statutory directive to consider ‘‘the effect of circumvention of technological measures on the market for or value of copyrighted works.” In particular, he emphasizes the need to “carefully consider the overall impact of any specific exception on the ability of content providers to effectively utilize technological access controls to protect and market their content.”

In this regard, Adkinson urges the Register of Copyrights to reconsider an exemption granted in the last proceeding to a class of works for which ‘control mechanisms fail to permit access because of malfunction, damage or obsoleteness.’ In contrast, Adkinson praises the Register for demonstrating its recognition of these issues in its refusal to grant an exception for lost or stolen access devices, and in rejecting calls for the extension of the first sale doctrine to digital goods.

Looking ahead, Adkinson maintains that anticircumvention protections associated with the DMCA may enable new business models to emerge that would give consumers access to “increasing diverse packages and prices.” He commends the Register for its recognition of the “potential value of ‘pay-per-use’ business models.”

The Progress & Freedom Foundation is a market-oriented think tank that studies the impact of the digital revolution and its implications for public policy. The Foundation is a 501(c)(3) nonprofit organization founded in 1993.