IP, Privacy and Antitrust This Week: Publishers Sue Audible, Google Ends Mobile Network Insights, Qualcomm to Keep “No License, No Chip” Policy, and more
Publishers Sue Audible over New Speech to Text Feature, Facebook Wins Appeal Against German Anti-Trust Order, Google Ends Mobile Network Insights for Telecom Operators, TikTok Warns Against Predators, CCI Orders Probe into Intel’s Warranty Policies in India, Qualcomm Wins Stay Order to Keep “No License, No Chip” Policy, and more.
Publishers Sue Audible over New Speech to Text Feature
Major publishers have jointly filed a copyright infringement suit in a New York Court against Amazon’s audio book company, Audible. They claim that Audible’s new Text-to-Speech feature called Audible Captions, is in clear violation of copyright law. The feature uses artificial intelligence to transcribe spoken words in the audiobooks into written ones so that readers can see the words while listening to the audio, much like subtitles in a movie. The publishers have taken issue with Audible using only its audiobook licenses, without taking the separate licenses necessary for reproducing physical books and eBooks. In response, Audible has issued a statement that the feature is intended to be educational, and used only to help kids improve their reading skills.
The core issue in this case is likely to revolve around whether AI-generated audio transcriptions are sufficiently transformative so as to not infringe copyrights.
Amazon has previously faced a similar suit for the opposite feature, for its text-to-speech feature which read out Kindle eBooks, in which publishers accused Amazon of attempting to capitalize on the emerging audiobook market. Eventually, Amazon was forced to give publishers the option of disabling this Kindle feature.
Facebook Wins Appeal Against German Anti-Trust Order
Facebook has succeeded in having an order by the German Federal Cartel Office (FCO) blocked on appeal. The order prevented Facebook from combining data across all its online platforms, including Facebook, Instagram and WhatsApp, without user consent. The German FCO and other EU privacy authorities have been conducting long-running investigations of alleged abuse of user data. Although the EU current privacy rules (the GDPR) allow regulators to block unlawful data processing, orders compelling a ban on processing are rare. This order is also notable because the appellate court saw no automatic harm to competition where a dominant company’s possible violation of data privacy rules. The court relied on the fact that users voluntarily agreed with Facebook’s terms and conditions, and that users could continue providing the same data to companies other than Facebook.
The FCO, which has one month to appeal the suspension order, has confirmed its intention to appeal. It will be interesting to note how this ruling may affect similar investigations against technology companies in other jurisdictions.
Google Ends Mobile Network Insights for Telecom Operators
Google has decided to end its free-of-cost Mobile Network Insights service, through which it shared Android user data with wireless carriers. Launched in 2017, this service was essentially a map showing the signal strengths and connection speeds that carriers were delivering in different areas. Although the data used for this purpose was aggregated (meaning the specific user could not be associated with the data) and was taken from users who opted for sharing location history with Google, there remained a high risk of regulatory scrutiny. Google is currently facing investigations by EU privacy regulators, and is consequently re-evaluating its data collection and sharing practices. While the sheer number of Android users made carrier service data valuable, telecom operators may have been slow to upgrade their networks, thus limiting the utility of the service.
A similar service was launched by Facebook last year, through which it shares connectivity data and personal interests with carriers.
TikTok Warns Against Predators
In an initiative to counter cyberbullying, online video-sharing platform TikTok has issued fresh warnings to parents and users. Though the platform allows access only to users over 13, it is virtually impossible to monitor the age of users accessing the app, through which users may be easily exposed to strangers. Also, the anonymity of communicating through private messages and the ease of searching for user profiles has made the app prone to misuse by predators. Teenagers in particular may be more vulnerable to predators posing as representatives of social media influencers and requesting photos or videos.
CCI Orders Probe into Intel’s Warranty Policies in India
Based on a complaint filed by Matrix Info Systems Pvt. Ltd., the Competition Commission of India (CCI) has ordered a probe against Intel Corporation and its Indian subsidiary, Intel Technology India Pvt. Ltd. The Delhi-based company, which deals in import, supply and distribution of IT products, has contended that Intel entered into exclusive agreements with designated authorised sellers for sale of its products in India. Also, Matrix alleges that Intel revised the warranty policies for its ‘Boxed Micro-processors’ to make it country-specific; which would not cover products purchased in other countries and brought to India. In its response, Intel has contended in its response that customers could avail of the warranty in the country of purchase. However, the CCI has made certain prima facie observations, including the dominant position of Intel in the market for micro-processors, high entry barriers to the market, and the higher prices charged by Intel’s authorised distributors in India compared to prices outside India. The CCI has also noted the potential for parallel importers and resellers to be denied market access to India, and thus ordered the probe.
Qualcomm Wins Stay Order to Keep “No License, No Chip” Policy
Chip-maker Qualcomm Inc. has been allowed by a US appellate court to continue selling chips subject to the purchase of a patent license. This ruling was issued in Qualcomm’s appeal against an order in May this year, in which a court held that Qualcomm was engaging in anti-competitive practices and mandated that Qualcomm make its licenses available to rival chip-makers and renegotiate the terms. Qualcomm had been sued by the US Federal Trade Commission (FTC), for allegedly harming the market for modem chips by refusing to license its standard essential patents and thus preserving its monopoly in the LTE chip market. However, Qualcomm was able to prove both that its “no license, no chip” policy did not violate antitrust laws, and that it would suffer irreparable harm if the ruling was given effect. The May 2019 order has been widely criticised for its unduly expansive legal interpretations as well as a failure to recognise the sophistication of parties involved in the transaction. San Diego-based Qualcomm derives huge fees from smartphone companies across the globe for its fundamental patents on smartphone technology, and has faced numerous investigations for its position in the market.
Authored and compiled by Ashwini Arun and Anusmita Mazumder (Associates, BananaIP Counsels)
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