Digital technology and the Internet have profoundly changed the manner in which copyrighted content can be distributed. Copyright owners, who in the pre-digital age controlled the market, were faced with the spectrum of uncontrolled dissemination of copyrighted content on the Internet. This threat prompted them to introduce massive legal and technological protection measures to secure their position in the digital environment. These measures, in turn, disturbed the balance of interests built into copyright law and impacted other stakeholders, in particular, the computer technology industry and the public at large. This chapter examines the main legal and technological measures devised to contain unauthorized dissemination of copyrighted content on the Internet, and the impact of these measures on each of the stakeholders in the digital copyright debate. It concludes by discussing possible future scenarios for distribution and consumption of digital content. Part I of this chapter describes the legal and technological measures currently available for protection of digital content. These measures are conceptualized in the form of a three-tier structure, in which traditional copyright law forms the first tier, technological protection measures the second, and digital age legislation to reinforce the technological protections, the third. The first tier, grants creators limited exclusive rights to their works. Its broader objective is to ensure future contributions to the collective store of knowledge by virtue of such creations. Traditional copyright law works well in a controlled market and territorial setting. It is not equipped to protect content in a global digital environment. Digital technology and the Internet brought with them the ability to make unlimited copies and, as a result, rightsholders were unable to control the unauthorized dissemination of content via the Internet. In response to this new environment, rightsholders developed a second tier of protection - technological measures designed to control access to and use of copyrighted content. It soon became apparent, however, that these new protection methods were easily circumventable. A third protection tier followed, in the form of legal reinforcement of the technological protection layer. The international community agreed to address the problems of the digital age, specifically circumvention of technological measures in the WIPO Treaties. The expectation underlying these treaties was that unlawful distribution of digital works on the Internet would be contained once all member countries had enacted anti-circumvention laws into their national legislations. Part II of this chapter examines the impact of the three-tier structure and its impact on each of the stakeholders in the digital content debate. The rightsholders. The availability of DRM operates a fundamental change of paradigm for rightsholders, marked by new ways of presenting content, new tools for distribution and consumption and new markets. However, the new technology also makes unauthorized dissemination of content hard to contain. The content industry suffers huge losses as a result of piracy. Intensive enforcement actions under digital age legislation and other laws, have met with mixed results: although the rightsholders have in general prevailed, the unauthorized dissemination has migrated to forms less easy to enforce. The public is one of the prime beneficiaries of the vast amounts of information and cultural products digital technology and a networked society have made available. However, the three-tier protection measures jeopardize the structure of limitations and exceptions built into traditional copyright law for the benefit of the public. The result is that consumption options such as browsing, re-using, quoting, sharing, time shifting, space shifting, etc are disappearing and fundamental rights, such as the rights to information and expression, risk being invaded. The information technology industry provides both the channels for distribution of digital content and the means for controlling them. To maintain the market for copyrighted digital products, the content industry needs to acquire control over both. The content industry has sought to gain control over newly developed technologies, by various legal means, including enactment of the DMCA’s anti-trafficking provisions, litigation against technology providers utilizing theories of secondary liability for infringement and legislative proposals. The chapter concludes by discussing two categories of future scenarios of the digital content debate. The first category builds on existing building blocks and is based on the assumption that developments will occur naturally without passage of additional legislation. These scenarios include DRM based models, which favor rightsholders; and the collaborative model, which favors the public. Some of the scenarios which require the passage of legislation, are the Levy Model, Increased Deterrent by Stronger Copyright Laws and The Public Utility Model
