business Archives - IPOsgoode /osgoode/iposgoode/tag/business/ An Authoritive Leader in IP Tue, 14 Jun 2022 16:00:46 +0000 en-CA hourly 1 https://wordpress.org/?v=6.9.4 The Music Industry (Taylor’s Version) /osgoode/iposgoode/2022/06/14/the-music-industry-taylors-version/ Tue, 14 Jun 2022 16:00:46 +0000 https://www.iposgoode.ca/?p=39712 The post The Music Industry (Taylor’s Version) appeared first on IPOsgoode.

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Tanzim Rashid is an IP Innovation Clinic Fellow and a 2L JD/MBA Student at Osgoode Hall Law School & the Schulich School of Business. This article was written as a requirement for Prof. Pina D’Agostino’s Directed Reading: IP Innovation Program course.


Taylor Swift’s dispute with Big Machine Records shines a spotlight on the legal and business considerations artists should keep in mind when making decisions about how to manage their catalogue.

Sparks Fly

In , Ithaca Holdings acquired Big Machine Records for an estimated $300 million, including the master recordings for one of the most popular and successful musicians in the world:Taylor Swift. Swift, in being denied an opportunity to bid for her masters, in late 2020 that she would re-record her entire pre-2019 catalogue in order to regain control of her music and limit the profitability of Ithaca’s asset. Over the next year, Swift released re-recorded versions of both her Fearless (2008) and Red (2012) albums, receiving widespread commercial and critical success.

Look What You Made Me Do

At the heart of Taylor’s decision was an often overlooked but significant legal distinction in the copyright law governing the music industry. All music can be subdivided into categories of copyright: lyrical, compositional, and sound.The former (‘recording rights’) are generally retained by an artist, while the (‘master rights’) – as part of a record contract signed by musicians in the formative stages of their career – is owned by the record company (including prohibitions on re-recordings for a set number of years) with certain vetoes the artist can assert with respect to how they are licensed.Swift, in deciding to re-record her albums, ensured that her new (Taylor’s) versions gave her all three types of intellectual property right over her catalogue, guaranteeing full ownership.

While many artists both past and present have record contracts that follow this same structure (and provide for a legal avenue by which to circumvent the record company’s ownership of the master recordings), it was Swift, at the height of her popularity, who decided to invest the time, energy, and cash in order to take advantage of this technicality. These circumstances are noteworthy: artists in similar positions to Swift often either lack the time, the financial resources, or the industry power to pull off a move like this. It is in Swift’s confidence in her fans adopting the newer versions of her recordings, and thus giving effect to the technicality she is leveraging, that her decision was made and her temporal and financial investment was put forward.

Everything Has Changed

Shamrock Investments, who acquired Swift’s master recordings from Ithaca in 2020, are in an increasingly tenuous position: Swift has them from licensing to ad agencies, films, and tv shows, and where they do license, Swift receives royalties in those cases. On top of all that, their investment in the original recordings depreciates in value every time Swift releases another one of her re-recordings or a company licenses them instead of the originals.

Major players in the music industry (including Swift’s own Universal Music Group) have responded in light of Taylor’s shrewd business moves, doubling or tripling the length of re-recording prohibitions in their most recently signed record .Artists are now for up to ten years after commercial release before re-recording their music, which also happens to be the period when their works are at their highest monetization potential. The music industry is now acutely aware of how digital streaming platforms provide artists with a never-before-seen ability to sidestep large traditional record companies when attempting to publish their re-recordings, creating a much-heightened potential for Swift’s precedent setting move to be seized upon by other successful artists looking to take back control of their creative output. From a legal perspective, Swift’s ability to resolve this dispute without reliance on costly, time intensive litigation or a protracted negotiations process has also put the music industry on notice, including their in-house counsel, who will be much more meticulous in drafting new agreements to best protect their company’s investment.

End Game

Looking to the future, it appears that beyond her personal dispute with the owners of her original masters, Swift is looking to inaugurate a major shift in the music industry at large, relocating bargaining power to artists from record companies. However, in capitalizing on the legal technicality available hitherto her dispute, with the unique power she wields in the industry, it may be the case that Swift’s maneuver may end up disempowering less powerful artists, who will now face stricter terms on their freshman record deals and an army of legal counsel prepared to respond to strategies similar to those deployed by Swift. As record companies fortify their defences, most upcoming artists may not be in a position to fight back against The Man.

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Securing Copyright Protection for AI-Generated Creations – A Business Perspective /osgoode/iposgoode/2022/05/18/securing-copyright-protection-for-ai-generate-generated-creations-a-business-perspective/ Wed, 18 May 2022 16:00:00 +0000 https://www.iposgoode.ca/?p=39600 The post Securing Copyright Protection for AI-Generated Creations – A Business Perspective appeared first on IPOsgoode.

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Mariela Gutierrez Olivares is an IP Innovation Clinic Fellow and a 2L JD Candidate at Osgoode Hall Law School. This blog was prepared as a requirement for the Directed Reading: IP Innovation Program course, taught by Prof. Pina D’Agostino.


Artificial Intelligence (AI) technologies prevail all around us. Lawmakers are playing catch up by addressing what non-human authorship means for intellectual property as we know it.

Current AI and machine learning uses range from theto thefor people with disabilities. More controversial areas of AI include its use inԻ.

Causing just as much controversy is whether AI can be an author. Can AI produce original works? If so, should those works be protected by copyright? And who would own that copyright?

Response from Copyright-granting bodies

These are questions that the Canadian Intellectual Property Office (CIPO) has been grappling with along with its counterparts in other jurisdictions (as others have previously written on and ). CIPO has reached a conclusion after theyto a piece of art(along with a human co-author).

By comparison, the US Copyright Office Review Board hasthat obtaining copyright protection, citing that copyright law only protects those works that “are founded in the creative powers of the mind.”

In the EU, a 2009established a test that describes originality as requiring an “author’s own intellectual creation.” Though the EU Court of Justice has not yet had a test case to define authorship further, there is a strong indicator inof the need for a physical person.

The Growing Powers of AI

Despite the mixed reactions from the governing bodies that have the power to issue or deny copyright protection to AI-authored works, the fact is that AI tools that can generate original works have arrived.AI tools that(one has even), works(including news articles), andalready exist. Countless more AI creations may be underway.

The Legal Conundrum

The legal debate of who or what gets to be an author () will continue. Copyright law has been around since the 18th century, and the evolution of technology has allowed humans to reach new heights of creativity for mass consumption.

Much of the debate centers on the notion that only works born from a human mind (where computers and software were used merely as tools) are worthy of copyright protection. Yet, proponents of AI authorship have drawn an analogy between the novelty of non-human authors and the once novel notion of corporate personhood. have suggested the introduction of anto protect “authorless” AI-generated works.

Even if, eventually, AI-generated works are protected by copyright, uncertainty remains as to. Traditionally, the first owner of a copyright is the author, and other entities may be secondary owners (i.e., an author’s employer or publisher). For now, at least in Canada, ownership will be assigned to the person who arranged to create the work and not the AI that created the work itself.

Implications for Businesses Leading the Way for AI-generated Creations

What does the current ambivalent landscape mean for those looking to protect works authored by AI? The debate is far from over, and we will undoubtedly continue to see jurisprudence about AI-generated works. Businesses that have developed AI tools capable of generating original works with a view to monetizing these creations are in legal limbo.

For now, it seems developers of AI tools have two options. The first and arguably safer route is to designate the person overseeing the AI technology as author or co-author of its creation. This could help more rapidly monetize AI-Generated works, as courts determine whether AI-generated work can be copyright-protected and how ownership will be assigned.The second and riskier option is to continue innovating and help spearhead the evolution of the law or else hold closely their potentially copyrightable assets. Should AI creations be deemed eligible for copyright protection in the future, those who have already developed AI technologies may be positioned to exploit intellectual assets early on.

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IP Metrics: Notes on the 5th Annual IP Data & Research Conference /osgoode/iposgoode/2022/04/01/ip-metrics-notes-on-the-5th-annual-ip-data-research-conference/ Fri, 01 Apr 2022 16:00:00 +0000 https://www.iposgoode.ca/?p=39366 The post IP Metrics: Notes on the 5th Annual IP Data & Research Conference appeared first on IPOsgoode.

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Emily Xiang is an IPilogue Writer, the President of the Intellectual Property Society of Osgoode, and a 2L JD candidate at Osgoode Hall Law School.

This article is part of a series covering the 5th Annual IP Data & Research Conference, hosted by the Canadian Intellectual Property Office and the Centre for International Governance Innovation.

On Thursday, March 24th, 2022, the Canadian Intellectual Property Office (CIPO) and the Centre for International Governance Innovation (CIGI) hosted their 5th Annual IP Data & Research Conference. For their third themed session, “IP Metrics”, experts were invited to speak about the ways they have been observing global IP trends, making IP data more accessible, and measuring the impact of IP on economic growth in Canada.

Where do Canadians Patent? Implications for Canada’s Patent Regime

Joel Blit, Professor of Economics at the University of Waterloo and CIGI Senior Fellow, kicked off the session. Blit examined the countries in which Canadian investors filed patent applications and sought to determine the extent to which the Canadian patent regime fosters domestic innovation. He found that Canadians were increasingly filing patents abroad, with more Canadians filing in at least one other country each year. Results also showed that patents filed exclusively in the US related to more advanced fields of computer sciences and technologies, while Canada-exclusive patents focused more on special-purpose machinery and the resources and energy sectors. Canadian patents also tended to belong to individual inventors rather than larger assignees, involved fewer inventors, and were cited less frequently, making them relatively less valuable in the global market for innovation.

Blit puts forward several potential explanations. One is that the Canadian patent system is providing less incentive over time for protecting domestic innovations. Another explanation is that Canadian patents are too strong, meaning it may be preferable to “weaken” them by setting higher examination standards, limiting patentable subject matter, or reducing the scope of issuable patents. That Canadians are increasingly patenting abroad could mean that Canadian inventors are becoming increasingly sophisticated, yet it could also mean that Canadian innovations and ideas are more frequently bought up by multinationals. Either way, the current Canadian patents regime seems to play a relatively minor role in promoting domestic innovation worldwide.

Identifying Artificial Intelligence (AI) Invention: A Novel AI Patent Dataset

Nicholas A. Pairolero, Economist in the Office of the Chief Economist at the United States Patent and Trademark Office (USPTO). delivered the second presentation of the session. Pairolero’s team sought to make data on AI more accessible to the public by developing a novel dataset that identified AI tech components in over 13.2 million USPTO patents and pre-grant publications.

After first determining a definition of AI, Pairolero and his team searched through USPTO’s patents using an automated machine learning (ML) model that differentiated between patent documents that did and did not contain any AI component technology. In the evaluation stage, expert AI examiners evaluated each document for AI component technology. Compared to more traditional, query-based approaches, the ML approach resulted in relatively lower precision (as a much larger number of documents were identified as containing AI), but a much higher recall (higher probability of correctly identifying AI). Moreover, both machines and humans seemed to struggle with classification at the boundaries of the various AI component technologies. However, results indicated that the ML approach achieved state-of-the-art overall performance relative to a variety of existing benchmarks from academic and policy literature, holding much promise for the future of automated processing in expediting the transmission of publicly available data.

Missions, Mandates and Metrics: What are the Right Metrics for Academic Technology Transfer?

The session concluded with a pair of presentations by Mike Szarka, Director of Research Partnerships at the University of Waterloo, and Natalie Raffoul, IP Lawyer and Managing Partner at Brion Raffoul LLP. Szarka began by suggesting that most Technology Transfer Offices (TTOs) focused on some combination of a) maximizing gross revenue and licensing income generally; b) focusing on the few projects that would maximize profits; c) maximizing knowledge mobilization and research impact; d) maximizing local economic growth, and e) maximizing client satisfaction and prioritizing the needs of faculty and students. Szarka’s surveying of TTO directors across the country demonstrated that knowledge mobilization, economic development, and service to academic communities ranked much higher in the minds of the respondents than revenue generation, indicating that commonplace TTO metrics focused on royalties do not reflect the true priorities and missions of most TTOs.

Raffoul identified several alternative metrics focused on “the betterment of Canadian society”. Average reported business expenditures invested into research and development () and have been low in Canada compared to the global stage. The greater concern is whether Canadians are owning their ideas and subsequently having the opportunity to commercialize those ideas downstream (instead of assigning their rights over to foreign firms). Raffoul suggested that TTOs ought to track the number of patents they are licensing/optioning/transferring to Canadian headquartered firms compared to foreign ones, along with the revenue generated from those licenses/options/transfers and any research collaborations with those firms. For company-sponsored academic research, co-ownership of patents ought to be held up to co-authorship of papers and publications, in order to correlate evidence of knowledge creation with the ultimate ownership and control of that knowledge.

Conclusion

Though there is much work to be done for Canadian innovators and owners to remain competitive in the global market, the most recent advancements in research and technology prove that Canada is well-positioned to identify shortcomings and well-equipped to tackle them.

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Hackers aren't only in Movies?! The Rise of Ransomware Incidents in Canada and what Canadians can do about it /osgoode/iposgoode/2022/03/17/hackers-arent-only-in-movies-the-rise-of-ransomware-incidents-in-canada-and-what-canadians-can-do-about-it/ Thu, 17 Mar 2022 16:00:59 +0000 https://www.iposgoode.ca/?p=39290 The post Hackers aren't only in Movies?! The Rise of Ransomware Incidents in Canada and what Canadians can do about it appeared first on IPOsgoode.

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Emily Xiang is an is an IPilogue Writer, President of the Intellectual Property Society of Osgoode (IPSO), and a 2L JD Candidate at Osgoode Hall Law School.

Imtiaz Karamat is an IP Osgoode Alumnus and Associate Lawyer at Deeth Williams Wall LLPwhopractices in the areas of intellectual property and information technology law.

This article was on the OBA’s Information Technology and Intellectual Property Law Section’s .

The threat of cyber attacks is no longer restricted to TV shows and movies, with cyber security incidents like ransomware attacks becoming far more frequent in daily life. While the COVID-19 pandemic may have slowed many aspects of society, ransomware has seen a marked increase in recent years around the globe – and Canada is no exception.

THE GROWING RANSOMWARE THREAT

Ransomware incidents involve threat actors infiltrating an organization’s defenses and deploying malware to prevent the company from accessing its information. Though the specific tactic may differ between threat actors, users will ultimately find themselves unable to access vital data and key systems unless the organization pays a ransom to the threat actors, usually in the form of digital currency. During the incident, threat actors may also extract data from the company’s network, which can have serious privacy consequences for the organization and its customers. Not only will their data be in the hands of an unknown party, but in many cases, threat actors may threaten to publish the exfiltrated information online if the organization refuses to provide them with payment.

Ransomware saw record-breaking numbers last year. By the end of the first half of 2021, global ransomware attacks hadby 151% as compared to the previous year, with ransom payments of up to CAD$48.4M being paid out to hackers. In Canada, the Canadian Centre for Cyber Security (the Cyber Centre) has knowledge of at leastthat occurred over the course of 2021 (though, it is important to note that the majority of ransomware attacks go unreported). Out of the known ransomware incidents that were reported to the Cyber Centre, more than half involved critical infrastructure providers. However, the Office of the Privacy Commissioner of Canada (the OPC) stressesfrom an attack, as incidents of ransomware have occurred indiscriminately since 2020 in not-for-profit, professional, financial, transportation, manufacturing, and retail sectors.

The increase in ransomware incidence and scope in recent years is partly attributed to the growing sophistication with which cyberattacks may now be conducted. A number ofin ransomware have arisen, and are rapidly changing the cybercrime landscape. For instance, ransomware-as-a-service (RaaS) is a model that allows developers to sell and/or lease ransomware to cybercriminals whilst being paid a percentage of the profit. These kinds of schemes allow an increased number of unskilled threat actors to get a hold of sophisticated ransomware technology, while providing skilled attackers the opportunity to profit from the mass distribution of their work. The world has also seen an increase in victims of high-impact targeting, wherein more targeted attacks are being launched at supply chains and essential services in order to maximize potential victims and profits. For instance, many threat actors have leveraged the COVID-19 pandemic to aim at high-impact targets that have become especially vital in current circumstances, such as emergency medical services and law enforcement agencies. As stated by chief information officerat UTHealth in Houston, “[a]ttackers [targeting hospitals] understand that we’re talking about life and death. There’s a great incentive to just pay and get the thing unlocked so we can treat patients.” In finding more opportune ways to breach vulnerable organizations, threat actors are demonstrating that their targeting schemes are becoming increasingly sophisticated, as well as strategic.

SEVERE FALLOUT FROM ATTACKS

Ransomware attacks may have far-reaching implications on company operations. On May 7th, 2021, American oil companyfell victim to a ransomware attack that immobilised several of its computerized equipment systems. As a result, operations for the largest fuel pipeline in the US were temporarily suspended, resulting in price spikes and fuel shortages for millions of Americans. Even more recently, global human resources company Ultimate Kronos Groups (UKG) was also hit with a ransomware attack on December 11th, 2021, resulting in a worldwide shutdown of their cloud services. The incident impacted millions of users, with employees who relied on UKG’s cloud system reporting paychecks short by, as their employers struggled to find alternative means for managing payroll. Kronos is known totens of thousands of organizations – including half of the Fortune 100 – and more than 40 million people in over 100 countries everyday, including businesses in Canada.

A CALL FOR ACTION

The Cyber Centrethat ransomware will continue to pose a threat to national security and economic prosperity in 2022. They also predict that threat actors utilizing ransomware will likely become increasingly aggressive in their operations and targeting schemes. Similarly, the OPCthe potential harm that can result from this type of attack and considers such incidents to meet the real risk of significant harm threshold under thePersonal Information Protection and Electronic Documents Act. As part of an ongoing, national effort to mitigate the effects of ransomware and related cyber threats, theto take this matter seriously and address it head-on through adopting proper security measures.

PREPARING FOR RANSOMWARE ATTACKS

Cyber Security Preparations

To assist organizations in their cybersecurity preparation, the Cyber Centre recently released a(the Playbook) with guidance on how to defend against and recover from cyberattacks. It recommends that businesses implement cyber defence planning strategies, such as preparing multiple backup systems ahead of time. Backup systems provide organizations with a copy of their data, which can then be used for restoration activities in the wake of a ransomware attack. When developing a plan for implementing backup systems, it may be useful to contemplate the frequency and extent that the data should be backed up and storage considerations for the backup systems. The Cyber Centre advises that backups stored online within the organization or on a cloud platform are more commonly susceptible to ransomware attack, while backup systems stored offline, in a separate physical location from the main business site and disconnected from its networks, offer the most protection against ransomware incidents.

In addition to preparing backups, the Playbook has details on different cyber security controls that can be implemented as part of the organization’s defenses. For example, having multi-factor authentication (MFA) in place on company devices may assist in thwarting off threat actors. It may also serve to hinder threat actors from gaining full access to target systems in the event thattheyaresuccessful in getting past initial IT defenses. In addition to MFA, businesses may want to consider having a system that can continuously monitor their network and establish an acceptable baseline of activity. This can be used to flag anomalies in activity patterns and sound the alarm when there is a potential risk to the organization.

Planning Ahead

Apart from having technical controls, it may be prudent to consider creating plans that serve as reference guides during ransomware incidents. The Cyber Centrecreating an incident response plan that is geared towards cyber defense strategy, including detecting and responding to an attack. The incident response plan can include the objectives, stakeholders, responsibilities, communication methods, and escalation processes that are involved in the response strategy. To formulate this plan, organizations may want to conduct a risk assessment of their assets and identify the potential consequences that would result from them being compromised, so as to discern the business’ response priorities. When drafting the incident response plan, it may be beneficial to keep the plan simple and flexible, so that it can be easily adapted to the circumstances of the actual event.

To compliment the incident response plan, businesses could consider developing a disaster recovery plan that focuses on resuming operations after a ransomware incident. The Cyber Centrethat an effective plan should identify the entity’s critical information (e.g. financial records, proprietary assets, etc.), their most essential systems that are required for business continuity, and their most vital business functions. Once a plan is formulated, multiple trial runs should be conducted to determine potential areas for improvement.

More Options

In addition to the above ransomware-specific guidance, themay offer insight for organizations looking to improve their cybersecurity foundation. This program is mainly aimed at small and medium-sized businesses, but welcomes enrolment from all organizations in Canada. As part of the program, businesses are required to adopt measures in certain baselinethat reflect industry-accepted best practices and target key considerations for the organization’s systems and employees. Furthermore, implementing these controls has the added benefit of fulfilling prerequisites for the Government of Canada’s. The certification is valid for two years and can beat the organization’s physical location and on its website to let others know that their business has met the standard.

CYBER INSURANCE

When preparing for ransomware attacks, organizations may want to consider how they would fund response efforts in the event that a threat actor manages to get through their defences. Though a business is already insured, traditional insurance policies may provide limited or no coverage for cyber attacks. Reviewing one’s current insurance policy and acquiring adequate cyber coverage where it is lacking is a crucial step that should not be left out of any discussion on ransomware preparation.

MOVING FORWARD

In our current technological landscape, ransomware attacks and other cyber security incidents have unfortunately become a daily reality of doing business in Canada and around the world. In light of the rising threat, organizations are encouraged to approach the matter with equal tenacity. By taking the appropriate proactive measures, we can better safeguard our activities and mitigate the impact of ransomware attacks on our businesses.

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Leading Legal Disruption: Artificial Intelligence and A Toolkit for Lawyers and the Law /osgoode/iposgoode/2021/05/28/leading-legal-disruption-artificial-intelligence-and-a-toolkit-for-lawyers-and-the-law/ Fri, 28 May 2021 13:00:00 +0000 https://www.iposgoode.ca/?p=37471 The post Leading Legal Disruption: Artificial Intelligence and A Toolkit for Lawyers and the Law appeared first on IPOsgoode.

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Pina's AI Book

Photo Credit: Prof Pina D'Agostino

Prof Pina D'Agostino

Prof Giuseppina D’Agostino is the Founder & Director of IP Osgoode, the IP Intensive Program, and the IP Innovation Clinic, the Editor-in-Chief for the IPilogue and the Intellectual Property Journal, and an Associate Professor at Osgoode Hall Law School. She is also very proud of her new book!

I am excited to share that I just published a collection on Artificial Intelligence (AI) and the law, Leading Legal Disruption: Artificial Intelligence and a Toolkit for Lawyers and the Law (Thomson Reuters 2021). Co-edited with Dr. Aviv Gaon and Carole Piovesan, the book provides a provocative analysis on the emerging terrain of AI and how it interrogates various areas of the law. The book, that features a foreword from the Hon. Marshall Rothstein (formerly of the Supreme Court of Canada), is an international collaboration of thought leaders in AI, with contributors from Canada, the USA, Europe and Israel. Issues discussed include intellectual property, privacy, contract law, regulation, governance, ethics, business and more. Importantly, such issues merit a toolkit of practical and international perspectives as they are increasingly complex and ajurisdictional.

In many ways this book is also a reflection of Osgoode’s strengths in AI. My co-editors, Dr. Aviv Gaon, Director at IDC Herzliya of Experiential Programs, is a PhD graduate (class of 2019) publishing several other books on AI and emerging technology, and Carole Piovesan (class of 2009) has co-founded her own firm, INQ Law. I am myself an LL. B graduate from Osgoode (class of 1999), eventually returned as faculty to found and run IP Osgoode and I am currently co-chairing the 91ɫ AI & Society Task Force, among many other initiatives in this space.

I am particularly thankful to the Osgoode JD students who provided helpful research assistance: Elif Babaoglu, Daniel Joseph, Joseph Simile, Rachel Marcus, Christopher Tsuji, and Julianna Felendzer.

I am most grateful for the enthusiastic endorsements by Prof David Vaver (Professor of Intellectual Property Law, Osgoode; Emeritus Professor of Intellectual Property & Information Technology Law, University of Oxford), Prof Jane Ginsburg (Morton L. Janklow Professor of Literary and Artistic Property Law, Columbia University School of Law), Justice Michael Manson (Federal Court of Canada), and Dan Bereskin (Partner, Bereskin & Parr LLP) all which can be read on the back cover.

They say you can’t judge a book by its cover, but I particularly like this one, inspired by an AI and suggestive of our youth, our future ultimately grappling with AI and other emerging technology, that will iterate in every generation.

I look forward to hearing from you on your thoughts on the book (and the cover!). You may order your copyhere.

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Grappling with Google: Market Monopoly, Big Tech Exclusivity, and Political Plays?? /osgoode/iposgoode/2020/11/26/grappling-with-google-market-monopoly-big-tech-exclusivity-and-political-plays/ Thu, 26 Nov 2020 13:48:05 +0000 https://www.iposgoode.ca/?p=36169 The post Grappling with Google: Market Monopoly, Big Tech Exclusivity, and Political Plays?? appeared first on IPOsgoode.

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In another attempt at tackling big tech, in late October, alleging that the company has been illegally monopolizing the search and search advertising markets through the use of highly exclusionary contracts and anticompetitive practices. In an increasingly digital society, Google has been heralded as “”, and such a significant suit could have massive implications on the landscape of digital markets in the future.

The Nature of the Lawsuit

There exists little doubt about the extent of Google’s current reach in the digital markets. It currently stands as one of the wealthiest companies in the world, with a market value of $1 trillion. It brought in $162 billion in revenue last year, and has accounted for just under . The Department of Justice’s lawsuit against Google is one that is expected to potentially drag on for years to come, and “” with regards to remedies, according to associate deputy attorney general, Ryan Shores. Specifically, the government seems to be pushing for “”, which could involve the selling and/or cessation of portions of the company’s business.

The suit is the product of about that U.S. officials began last summer into Google’s advertising practices. The inquiry then rapidly expanded to encompass search monopoly allegations after the emergence of several complaints from rival tech and media companies. In response, the Justice Department has decided to once again enforce the , an antitrust law regulating enterprise competition that the government has previously used on a number of occasions in the past to combat notable companies in the , , and industries.

Anticompetitive Conduct and the Potential Harms

The Justice Department claims that Google locks up digital channels of distribution by implementing a string of with manufacturers and distributors such as Apple, LG, Motorola, Samsung, AT&T, T-Mobile, Verizon, Mozilla, Opera, and UCWeb. These contracts include anti-forking agreements that constrain manufacturers and distributors to remain in relation with Google, pre-installation agreements for premium placement of Google products, and revenue-sharing agreements in exchange for preset, default search engine privileges. For instance, the company has to be the default search engine on Apple’s products. The two tech giants are indeed - last year, about 50% of Google’s search traffic came from Apple devices, while Google annually pays Apple billions of dollars for the privilege of exclusivity, its payments making up approximately 15 to 20% of all Apple’s profits.

There are a number of reasons why antitrust laws are in place, and why exclusionary and anticompetitive conduct on the part of big tech companies is discouraged. It can harm competition and stunt technological innovation by denying established rivals and emerging startup companies the necessary channels and recognition to compete effectively in the market. The government also alleges that because it diminishes choice and lowers the quality of search services, especially with regards to consumer privacy and data protection. Moreover, the company’s monopoly over the online advertising market allows them to charge higher rates than they would be able to in a competitive market, thereby reducing the quality of the services that Google must provide to .

In Google’s Defense…

Shortly after the announcement of the U.S. government’s lawsuit, Google’s chief legal officer Kent Walker published a response on the company’s website, calling the claim “”. On the company’s behalf, he insists that consumers “use Google because they choose to, not because they’re forced to, or because they can’t find alternatives”, and goes on to demonstrate the ease with which users can set up their search engine of choice or alter their default settings. Walker argues that the suit would artificially bolster lower-quality search alternatives, hike up phone prices, and inconvenience users in getting to the search services they want to use. Furthermore, while the government seems to think that Google competes exclusively with other general search engines, the company upholds that in practice, people find information through a variety of mediums, thereby expanding the competitive landscape to include such rival companies as Twitter, Instagram, Pinterest, and Amazon.

Other critics have questioned whether the timing of the suit might be politically-motivated, seeing as how the federal government and Attorney General William P. Barr allegedly (against the recommendation of some government lawyers) by the end of October, just weeks ahead of the 2020 presidential election. It might also be noteworthy that all eleven of the state attorneys general that have currently signed on to support the lawsuit , and that President Trump has previously criticized tech companies like Google and other widespread media platforms for politically leaning towards the left. However, both conservative and liberal leaders alike have denounced the lack of regulation over big tech in the past, and concerns that arise in the meantime regarding any political undertones within the lawsuit remain as speculation.

“Whether led by Donald Trump or Joe Biden, the next administration should think systematically and comprehensively about the power of tech companies and what needs to be done about it.” - Bill Baer,

Conclusion

Judging from the parallels between the present case and the Justice Department’s , it is clear that this development is only the start of something much bigger. Colorado, Iowa, Nebraska, and New 91ɫ state governments have asserted that they are still investigating Google’s business practices, and may sign on with the other state attorneys general in supporting the case at a later date. Regardless of what the court decides, the stakes remain considerable - either a potential restructuring of one of the world’s biggest digital empires, or a huge hampering of the government’s efforts in enforcing antitrust laws onto the big tech companies that it's been battling for years.

Emily Xiang is a first year JD candidate at Osgoode Hall Law School. She is an IPilogue editor and a 1L executive for the Intellectual Property Society of Osgoode.

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