In The Headlines

23 October 2015

In the Headlines-October 23rd, 2015

In The Headlines

Google Wins a Major Copyright Infringement Case

Google BooksGoogle won a decisive victory in a copyright-infringement case that the Authors Guild originally launched almost a decade ago. A federal appeals court ruled that the company’s book-scanning project, which has turned millions of books into searchable digital files, is entitled to the full protection of the “fair use” clause in copyright law. The case is hugely important, not just for Google (now part of a larger holding company called Alphabet) and the authors whose works are being digitized, but for the principle of fair use itself. Copyright law may be murky and difficult to pin down at the best of times, but interpreting the concept of fair use often makes regular copyright law look like a day at the beach. That is because what qualifies as fair use—which theoretically lets anyone use copyrighted content without having to get permission from the creator or rights-holder—is not specifically spelled out in federal copyright law. It is something that ultimately has to be decided by a court, and even then the judges have to consider four factors before they can come to a decision. Those factors are:
  • The purpose of the infringing use, specifically whether it qualifies as “transformative”
  • The nature of the original content (i.e., whether it is artistic or commercial)
  • The amount and “substantiality” of the original content that is used in the derivative work
  • Whether the infringing use will affect the market for the original product or content
What is interesting about the Google case is that this is not just some random website using an animated GIF of a football game—as happened recently with Deadspin. This is a $450-billion web giant copying millions of books, and then using them in part to feed its massive, money-spinning search empire. The part about Google being a multibillion-dollar entity was clearly what caused the Authors Guild to fight the case for so long—arguably long after it had already become obvious that it would probably lose. For the Guild, this was a classic case of David versus Goliath, with book authors representing the David character and Google the clearly “evil” Goliath using the work of others for its own purposes. The appeals court, however, pointed out in its decision that the purpose of copyright law is not to guarantee authors a living, nor is it to give them exclusive control over who uses their work and how. The purpose of the law is to provide an incentive for people to create artistic works because doing this benefits society—and ultimately, the social benefit of Google Books outweighed the infringement aspect. The key part of the ruling is that the book-scanning project was fundamentally “transformative” in nature. In other words, Google is not just copying the books it scans and indexes. It uses those copies to provide searchable “snippets” or short sections of each work so that users can find books more easily. What Google does is significantly different from simply copying books wholesale and then putting them on the Internet, the court said. And it provides a clear social benefit. It also provides a potential benefit to authors themselves, since it makes their work much easier to find, which is why some authors opposed the long-running case launched by their union. But the Guild refused to give up. The Guild says that it plans to appeal the case to the Supreme Court, but copyright experts like law professor James Grimmelmann say it is unlikely that they will be successful, given the history of previous decisions in the case. Citations 1. – Fortune

Nike Looks to Women to Expand Its Jordan Sneaker Brand

Nike Girl's Air JordansAfter ignoring women for three decades, Nike Inc.’s Jordan Brand will start making sneakers for them. There will also be gear for weekend warriors and football fans. Nike’s vision for Michael Jordan’s flagship line is to now extend to categories beyond basketball, all with the goal of doubling the brand’s sales to $4.5 billion by 2020. That even includes a play for runners, a category Nike already leads by a mile. “It is a great brand and has been one-dimensional — largely footwear, largely male and U.S.-based,” Nike Chief Executive Officer Mark Parker said in an interview. “The opportunity is to give the consumer more choice in that brand, carefully.” The success of the effort will be the latest referendum on the current state of Jordan’s marketing power, and on Nike’s reputation as a branding juggernaut. The move also has the potential to dilute one of the company’s crown jewels by getting away from its basketball DNA, according to Matt Powell, an analyst for research firm NPD Group. “It’s doable, but it will really take some thoughtful design work, and the product has to be right also,” Powell said. “If they can harness the strength of the brand, it can work.” Nike already dominates women’s athletic shoes, but the Jordan brand barely registers. Even at some marquee basketball programs where the men’s teams wear the Jordan brand, the women opt for Nike. Examples include Marquette University and the University of California. At Jordan’s alma mater, North Carolina, both teams sport the superstar’s line. While there is anecdotal evidence that some women are buying boys sizes, current Jordan offerings for women on Nike’s website are just accessories like socks, hats and backpacks. The brand also faces a challenge among 20-somethings, said Neil Schwartz, vice president for market insights at researcher SportsOneSource. “The millennial, for the most part, never saw Michael play,” he said. “These are the folks who are right now at the forefront of consumer spending.” Another risk of expanding the Jordan brand to women is that it may turn off the guys who came to love it as a men’s-only line, said Laura Ries, president of marketing-strategy firm Ries & Ries. “Jordan is one of the most iconic and successful brands, and it very much aligns with young men,” Ries said. “Once you start diluting it, it doesn’t have the credibility and authenticity it once had, and the guys might not want it anymore.” As a celebrity, Jordan is still tremendously popular. A dozen years after his playing days ended, Jordan is known by about 97 percent of women in the U.S., making him the seventh-most influential celebrity for them, according to the Marketing Arm’s Celebrity DBI database. Men rank him 11th. “Jordan’s scores are so strong in every way,” said Matt Fleming, executive account director at the Marketing Arm. “In terms of how female respondents and consumers feel about him, it’s virtually identical to how males view him, regardless of age.” Nike unveiled a few details in a presentation to investors in which it forecast an increase in annual sales from $30.6 billion to $50 billion by 2020. The Jordan brand is expected to contribute by doubling revenue through adding products and expanding beyond North America. The Jordan brand generates about 95% of its overall sales domestically, Powell says. Targeting women makes perfect sense, said David Falk, who was Jordan’s longtime agent. The 52-year-old Jordan, who consults on the brand, is on board with the shift. It’s a “high-end, performance lifestyle brand,” he said. “Michael has evolved beyond just being the heritage of a basketball player,” he said. “Michael is somewhat of a fashion icon.” The brand already has been dabbling in other categories. For starters, the University of Michigan’s football team will wear Jordan-branded uniforms next year. Now it seems almost anything is on the table, even a push into legitimate performance footwear. At $150 per pair and higher, Jordans long ago became a fashion accessory, with the irony that few recreational athletes actually wear them to play. “There’s a tremendous opportunity,” Nike Chief Operating Officer Eric Sprunk said. “Think of it as a performance brand. If Jordan is going to go into running, they are going to make a shoe you can run a marathon in.” Citations 1. – Bloomberg

The Good News Is . . .

Good News• The Thomson Reuters/University of Michigan’s preliminary October reading on the index was 92.1. That was higher than the previous month’s reading of 87.2 and Reuters’ estimates for 89. According to the report, personal financial expectations rose to their highest level since 2007, as did consumers’ views toward purchases of durable goods. Consumers anticipate a continued economic expansion, but also expect headwinds from low commodity prices and weakened global growth. The rebound in confidence seemed to signify that consumers have concluded that the fears expressed on Wall Street did not extend to Main Street. • Honeywell International, Inc., a leading provider of aerospace products, control technologies for buildings, turbochargers, and performance materials, reported earnings of $1.60 per share, an increase of 8.8% over year earlier earnings of $1.147 per share. The firm’s earnings topped the consensus estimate of analysts by $0.05. The company reported revenues of $9.6 billion. Management attributed the company’s results to new product introductions and expanding margins. • The world’s largest brewer, Anheuser-Busch InBev, maker of Budweiser and Stella Artois, struck an agreement in principle to acquire its closest rival, SABMiller, for about $104 billion. The deal would create a behemoth in the beer industry with annual revenue of about $64 billion. A merger would bring some of the world’s most popular beers under one roof, including Budweiser, Corona and Stella Artois from Anheuser-Busch InBev, and Grolsch, Peroni Nastro Azzurro and Pilsner Urquell from SABMiller. The deal would also give Anheuser-Busch InBev more exposure to faster-growing emerging markets, particularly in Africa and Latin America. Citations 1. – Bloomberg Economic Calendar 2. – CNBC 3. – Honeywell International, Inc. 4. – NY Time Dealbook

Planning Tips

Tips for Preparing a Living Will

Living WillA living will is a legal document, also called an advance health care directive, which details how you would like to be cared for if something terrible unexpectedly happens to you and you wind up on life support. Do you want doctors to do everything they can to keep you alive, even if the outlook is hopeless? Or do you give them permission to let you go? According to a survey of 1,000 adults last year by the legal information site, less than one of every three Americans have a living will. Below are some questions to consider about whether and how you should go about creating a living will. Be sure to consult with your legal and financial advisors if you are considering a living will. Do you need a living will? – It depends how you feel about the possibility of being in some sort of limbo where you are alive but not cognizant. Obviously, if you feel strongly either way—either you want to be allowed to die or you feel clinging to life support is still better than the alternative—you need a living will. Even if you have a “whatever happens, happens” mindset, you may still want to consider getting one. If not for you, then for your loved ones. It is important that your family and friends, when faced with having to make decisions as to your care, understand what your wishes and desires are regarding your end-of-life medical care treatment. How do you write a living will? – You will fill out a form, which you can get from an estate attorney or a hospital. You can also download it online, but you will have to get it notarized, and attorneys and legal websites such as the U.S. Living Will Registry caution that living will forms on the Internet may be outdated. State laws change, so you will want to make sure the living will form you are filling out is current. How much does it cost to put together a living will? – More than you might think. Living wills are typically executed as part of an estate planning package. But if you only want a living will, an attorney would normally charge a nominal fee to prepare the document. You could download a free form from a trusted source, or get it at your local hospital and have it notarized at your bank for a very modest fee. But to make sure you get your living will right, you will generally spend more. A ballpark figure is $1,000 for an individual and $1,500 or $2,000 for a couple. For this, you really want four documents: a will, a living will, a health care proxy and a power of attorney. What if you want something the standard directive doesn’t contain? – Depending on what the state’s advance health care directive form says, there may be room to write extra instructions. But if there is not, this is where having an attorney is important–in case the form needs to be modified in any way. You can and should add your wishes. For instance, if your religion plays a role in why you want life-sustaining treatment, you should add that. If you want life-sustaining treatment for, say, a full week, just in case a medical miracle occurs, put that in there as well. Where should you put my living will? – You will not do yourself much good if you lavish time, money, emotions and energy on your living will and then do not tell anyone where to find it. A copy should be given to your physician so they are part of your medical records. The person you have assigned to make your health care decisions should also have a copy, and you should keep the original at home. In short, you want everyone who may have a role to play in a life-or-death decision to know where it is. Citations 1. – 2. – WikiHow 3. – US News & World Report 4. – Mayo Clinic 5. – AARP

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