Traditional Media Uses Bullying Legal Tactics: Scrabble vs. Scrabulous and Hulu vs. Redlasso
In 2005 Rajat and Jayant Agarwalla created Scrabulous; by 2007 it went nuclear as a Facebook app. The social networking aspect of Facebook brought it a half-million daily players, giving users the ability to joust with friends and family across the world. While it is undeniable that Scrabulous has the "look and feel" of Hasbro Corp's Scrabble, let's look at that game through the lens of copyright law. What was first conceived in 1938 by an architect became ubiquitous: One in three U.S. homes has a Scrabble set. Apart from the fact that copyright does not protect board games, but expressions of ideas, and that Scrabble does have a copyright on the crossword puzzle writ large, its public tussle with the Agarwalla boys is the ongoing narrative of behind-the-curve traditional media that thinks that it can buy or bully its way back into fashion.
Scrabble is Tearing Families Apart
After cease-and-desisting Scrabulous last winter, Hasbro filed a copyright infringement complaint this July 24th. When on July 29th Facebook took the game down for U.S. and Canadian users, it was a day of mourning. If it's true, as The New York Times reports, that Hasbro offered Scrabulous $10M, then it's not a cut and dry case - but the blowback still tells a tale. Whatever loyalty generations past have had for Scrabble has been trampled as they attempted to assert their legal standing in the online space over a game - that while it might be a ringer for Scrabble, functioned not in difference, but in kind. The fact that Hasbro owns U.S. and Canadian rights to Scrabble, while Mattel has the rest of the world is also pertinent: Two game companies (Electronic Arts and RealNetworks' Gameshow, respectively) now exist as "official" versions of Scrabble in Facebook - and, as a side-effect, players can no longer cross borders to play with one another.
Newly christened Wordscraper, debuting less than two days later, may or may not be on the safe side of infringement, has a game-changer in that the board is itself customizable. This has led to observers suggesting that this has ushered in an era of collaborative design, with fans on Facebook cheering on its first efforts and creating board design workshops even as they practice "malicious interference" with the officially sanctioned online Scrabble. This poster on Mashableimplicitly argues for additional factors beyond copyright: "Since Hasbro responded late to adapting to social media, they deserve to face intense competition."
The Kindest Cut?
Redlasso, in its way, was as addictive as Scrabulous - but to bloggers. In less than eight months of beta the video-clipping tool had 24 million monthly uniques and 10 million video plays (April 2008). But the passion bloggers had for the service went beyond mere metrics. Used by Politico, Huffington Post, Perez Hilton, and scores of others, it put bloggers on equal footing with Big Media. And that got Big Media teed off. Apart from the free speech argument, that most snippets were two and a half minutes in length and as social commentary were fair use, former CBS Corp chief Michael Jordan (brought in to negotiate on behalf of Redlasso) offered a compelling sound bite why the platform should live on: "Redlasso converts a marketplace challenge into an opportunity for content providers, advertisers and online community, creating a new value for traditionally perishable content." That argument didn't prevent HuluJV partners NBCUniversaland Fox from filing papers in U.S. District Court in Manhattan on July 23rd, alleging that Redlasso's service wasn't licensed or authorized and is therefore infringing. Two days later Redlasso suspended service to bloggers, keeping its enterprise wing open - radio to Web clients including Greater Media and XM Satellite Radio.
Last week Cablevision won a second round appeal against the Hollywood studios and broadcasters who argued that its RS-DVR service was infringing. If the ruling is ultimately upheld, many believe that it will potentially extend to Web-basedcompanies the protection that the Supreme Court gave to home recorders. And this might present Redlasso, which is itself like the Cablevision service a virtual DVR, with a new business model.
Following on the success of the Rock Band and Guitar Hero videogames, Warners' Edgar Bronfman had this to say: "The amount being paid to the music industry, even though their games are entirely dependent on the content we own and control, is far too small." This caused Mike Masnick of Techdirt to suggest that the game developers switch to other record labels -- to cut him off. In essence, asserts Masnick, "The industry simply assumes that, if something makes use of their content, all of the value is in the content. That's incorrect. Yes, the content is a part of the value, but it's the game that's making that content valuable."
Masnick is right. The brothers Agarwalla earned the trust and loyalty of the Facebook community not merely through a solid (if derivative) offering, but in their frequent contacts, whether there was a server outage or an upgrade. Facebookers had come to see them not as retailers but as friends. Game developers such as Hasbro, content producers of film and TV, as well as record labels, would do well to follow their lead. Not only must a content owner take the initiative to stake out a frontier, but it must also offer added value.
Jerry Weinstein
Jerry Weinstein, jerry@jackmyers.com, is a regular contributor to the Jack Myers Media Business Report.
