37 Consumer Sound and Video Copying Devices — The Cassette and Home Video Recorder (Sony vs. Betamax)
Before the 1970s, there was relatively little concern about piracy of music, movies, or other mass media. That lack of concern was largely due to the state of technology. Before the rise of the cassette tape recorder, the economics of piracy favored the owners of copyrights, rather than the potential infringers. Reel-to-reel tape recorders were introduced in 1935 and were not prohibitively expensive, but few consumers owned tape recorders or wanted to deal with the inconveniences associated with them (such as rewinding or storing the fragile tapes). Transferring tapes back to discs required expensive lathes that in turn required maintenance and expert operators to produce a product of sufficient quality. Commercial records were also reasonably priced, so the net benefit to pirates required high-volume sales to earn much profit.
But the economics of piracy changed drastically with the invention of the cassette tape recorder and its video analog, the video tape recorder. The audio cassette was invented in 1962 and became available to consumers in 1964 (along with the associated hardware player/recorder). The first cassette recorder/players were small and affordable. However, the fidelity was relatively low due to the narrow width of the tape (less than ¼ inch as compared to the standard ½-inch width of reel-to-reel tape). But the small size and rigid plastic case of the cassette made up for the low fidelity with convenience, durability, and ease of storage. By 1966, both pre-recorded and blank cassettes had carved out a niche in the consumer audio market.
Like all technologies, the quality of the cassette improved over the years, so that by 1971, with the advent of Dolby noise reduction and improved motors, cassette recorders could produce an audio quality that approached that of the average record player. The primary advantage of the cassette lay in its portability, both of the tape itself and the players, so much so that by the early 1970s cassette players were becoming available as an upgrade in cars. The ability to bring one’s music collection into the car, rather than relying on whatever the local radio station played, was a momentous event in the history of portable audio. The Sony Walkman, available in 1977, took portability even one step further, offering an affordable, and battery-powered cassette player that could be held in one’s hand. The Sony Walkman even came in a model that offered recording as well as playback, using built-in stereo microphones, enabling live recording of concerts.
Due largely to the lack of unauthorized copying of sound recordings, there was no recognized federal copyright in sound recordings before the 1971 Sound Recording Act provided that only the copyright owner of a sound recording made on or after February 15, 1972 could “duplicate the sound recording in a tangible form that directly or indirectly recaptures the actual sounds fixed in the recording.” The fact that this law was passed just as high-quality cassette recording technology was reaching the consumer is no coincidence.
The cassette offered another revenue stream for record companies, and provided incentive for consumers to purchase cassette copies of recordings they already owned on vinyl in order to have a portable version. However, the cassette also came with a built-in liability: consumers could use it to record copies of music they had not purchased. Home “dubbing” of vinyl records to cassette became a common way to expand one’s record collection by borrowing records from friends or family to dub to cassette. Multiple high-speed cassette recording decks also became available to those wishing to sell pirated cassettes on a mass scale. Record companies preached against this practice and tried various methods to prevent it, including introducing the slogan “Home Taping Is Killing Music” in the early 1980s.
However, the record industry largely viewed cassette piracy as not much more than a nuisance as the continued growth of the industry indicated that most consumers still chose to purchase vinyl records, and then CDs after 1983, rather than taking the time and effort to dub copies. Particularly after the introduction of the CD, which offered an even more portable, durable, and high-fidelity experience than the cassette, the record industry largely ignored cassette piracy.
The home video recorder was a different story, however. With the introduction of the Sony Betamax video recorder in 1975, the movie and television industries faced a sudden piracy threat that resulted in one of the most significant U.S. Supreme Court decisions of the 1970s, Sony Corporation of America v. Universal City Studios, Inc. (1984) (known as the “Sony Betamax” case).
In the Sony Betamax case, Universal Studios sued Sony for violation of their federal copyrights for various television shows broadcast over public airwaves. Universal claimed that Sony, through the manufacture and distribution of its “Betamax” home video recorder (a proprietary videocassette format that competed with the “VHS” cassette format), allowed and encouraged consumers to make unlicensed copies of its copyrighted television broadcasts. Critical to this lawsuit is the fact that Universal was suing Sony, the manufacture of a video recorder, rather than suing the consumers who were alleging using that device to make unlicensed copies. This case became a high-stakes test of the novel legal theories of vicarious liability and contributory liability when applied to copyright infringement.
Universal’s allegation of vicarious liability is grounded in the idea that Sony was liable for the infringing actions of its customers, arguing that Sony acted vicariously through its customers to infringe on Universal’s copyrights. Universal’s related allegation of contributory liability against Sony put a somewhat different spin on that theory, arguing that Sony contributed to its customers’ infringing activities by providing them with the means to carry out the infringement. In the end, the U.S. Supreme Court ruled that Sony was not liable for copyright infringement, either on the vicarious or contributory liability theories. However, the court’s explanation of its reasoning in this case set important legal precedent for several later music copyright cases that also involved the concepts of vicarious and contributory liability.
There was no dispute in the Betamax decision as to the potentially infringing activity of those consumers who had purchased the device: many were clearly using their new video cassette recorders (VCR) to record copyrighted television broadcasts so that they could watch them at a more convenient time (“time shifting”). The Supreme Court recognized that the unlicensed copying of television broadcasts by consumers using the Betamax was likely a copyright infringement. However, the allegation was against Sony, not its customers who purchased the Betamax. Therefore, the court said, it’s important to note that there are other, non-infringing, uses of the Betamax that the device is also well-suited to perform, such as recording home videos or making copies of non-copyrighted material. Thus, the court looked to Sony’s actual marketing of the Betamax to determine whether it had encouraged or specifically aided consumers in using the device specifically to infringe copyrights, and whether it knew that copyright infringement would be the primary use of the device.
After considering these questions, the court held that Sony could not have had actual knowledge of exactly what use its customers would make of the Betamax, since it was capable of a variety of uses in the hands of a consumer, some of which did not involve copyright infringement. Thus, Sony could not be held to be vicariously liable for any infringement that its customers committed using the device. Further, the court found that Sony did not encourage or instruct consumers to use the Betamax to commit copyright infringement through its marketing of the device, so Sony was also not liable for contributory infringement. As we will see, however, the court’s analysis of Sony’s potential knowledge of the infringing potential of its product, and its marketing activities of that product, would provide important legal grounds for holding internet service providers liable for the copyright infringements of their customers in the coming fight against internet music piracy.
