Studios, techs take copyright dispute public


Computer makers could offer movie studios a proposal to copy-protect
high-quality digital movies, music and TV shows on the Internet by the end of
March, Intel Corp. executive vice president Leslie Vadasz said before the Senate
Commerce Committee Thursday.

That said, The Walt Disney Co. chairman Michael Eisner and News Corp.
president Peter Chernin aren't holding their breath. Although they are getting
desperate for a solution, they no longer trust their friends in Silicon Valley
when it comes to copy protection.

'Frankly, this is a court of last resort for us,' Eisner said, meaning
Congress. 'Hopefully, in the next 60 days, our associates in California will
come and we'll get this done.'

'I think we've made substantial progress, but I also think seven years is
long enough to wait,' Chernin said.

The movie studios have been negotiating with the tech industry for years.
They want all new computers and copying devices to include technology that would
keep copyrighted digital content off the Internet.

But Intel and other technology players say that could be an economic disaster
for them, and they have stood firm against making any agreement.

'Any attempt to inject a regulatory process into the design of our products
will irreparably damage the high-tech industry,' Vadasz said.

But without such protection, 'we will end the entertainment industry,' Eisner

Senate Commerce Committee chairman Fritz Hollings (D-S.C.) wasn't buying
Intel's story.

'Where do you get all of this nonsense about how you will have all of this
irreparable damage?' he asked. 'We don't want to legislate: We want to give you
time to come up with an agreement.'

Eisner also wasn't buying Intel's story, and he instead accused the
technology company of denying copyright protections to entertainment companies
because 'tech guys say the killer app for broadband technology is pirated
content. It's hard to negotiate with an industry that believes their short-term
growth is dependent on pirated content.'

Vadasz took exception to that characterization, saying, 'I don't think we can
build a significant big business on illicit use of intellectual property, so
this problem has to be solved.'

Disney and News Corp. want Congress to set an 18-month limit on negotiations,
then step in if the issue is not resolved by then. Hollings and Sen. Ted Stevens
(R-Alaska) have drafted a bill to that end and are threatening to introduce

Intel and its fellow tech companies fervently oppose any Congressional
intervention. On Wednesday night, Intel and eight other tech companies sent
seven movie studios a letter saying that they wanted to cooperate and find a

To that, Hollings said: 'At least now we have a time frame. Our bill gives
you 18 months, one expert says it can be done in 18 days and Mr. Vadasz says we
can do it now.'