By Dennis D. McDonald

Ed Felten, in Judge Geeks Out, Says Cablevision DVR Infringes, provides an overview of how technology played into a recent court decision on a case where Twentieth Century Fox Film Corp. was pitted against  Cablevisions Systems Corp. (2007 WL 867093).

The issue: whether Cablevision was liable for its copying of video programs on its internally managed servers based on instructions generated through commands issued by Cablevision customers via their storage-incapable set top boxes.

The legal points in the case are tricky; see William Patry’s discussion of the legal aspects  here. (Patry is an attorney with Google; thanks are due to Carey Lening of BNA for pointing Patry’s blog out to me.)  Also, Bill Rosenblatt has a business oriented discussion of the case here.

I italicized the word “its” — referring to Cablevision — in the first sentence of the above paragraph since a key issue being discussed  regarding this case, at least on the blogs I’ve read, is who actually was responsible for doing the copying under consideration. Technically, the focus on where something is stored in this Cablevision case seems to fly in the face of current technology service delivery trends. Remote storage and remote software application execution are becoming increasingly important not only for private and domestic applications but for business applications as well.

Just yesterday, for example, Salesforce.com, a provider of web-based customer relationship management (CRM) applications, announced that it was adding content management to its product line. That means that a company using Salesforce.com can manage key sales processes without having to install software on its own machines. Everything is stored and accessed via the web through Salesforce.com’s servers.

With yesterday’s announcement a Salesforce.com customer can also manage “content” such as documents, emails, audio and video files, and spreadsheets offsite as well. These are sometimes called “unstructured” data to differentiate them from the “structured” data you typically manage using a database management system.

Salesforce.com is not the only company using this “Software as a Service” model but it is one of the most prominent. I regularly use at least three other “remotely hosted” services in my own consulting business (for blog management, for database management, and for collaborative document development) and find they provide as much if not more functionality than a standard suite of applications stored on my own machines.

If you look at this Cablevision case you have to wonder what the implications might be for companies that offer services to manage customer data, especially in cases where commercial intellectual property might — accidentally or on purpose — become stored on the service provider’s servers. People within a customer company who use such a system might already be quite comfortable with cruising the web to locate information relevant to their jobs. They might then download a file from a paid-for commercial source (say, Gartner or Factiva) then upload the file to the remote server where it can be shared with and retrieved by other people with access to the content management system, unbeknownst to the copyright owners.

What responsibility will the service provider have for the actions of the customer staff members in such a situation? I understand that the Cablevision case might be a bit restricted in its applicability to corporate situations such as this. From what I can see happening in the information industry, though, the distinction between “public” and “private” use is becoming increasingly difficult to make, especially with so many young folks entering the workforce for whom online sharing and collaboration are the norm.

Note: I’ve added this topic to my “social media risk management” bookmark collection on del.icio.us. This appears  to be another issue that needs to be considered when assessing an organization’s risk exposure based on adoption of systems and processes related to social media and social networking.