Tricks of the trade

Wired: For us in the West, free trade agreements (FTA) these days are the stuff of back-page articles in the Economist and the…

Wired:For us in the West, free trade agreements (FTA) these days are the stuff of back-page articles in the Economist and the Wall Street Journal. In the streets of Seoul, South Korea, right now, they make for riots and hunger strikes, writes  Danny O'Brien.

But perhaps those in the tech industry here should pay them a little more heed: South Korea's brand new FTA with the United States may also be a premonition of the riotous future of the internet. Because, just as South Korea is years ahead of the West in terms of internet penetration, it is also, unfortunately, about to be years ahead in terms of internet lawsuits.

The wording of the latest FTA between the US and Seoul is mostly about, well, free trade: in agriculture, textiles, pharmaceuticals and the automobile trade.

Such agreements, covering as they do established industries and the relationship between developing heavy industry and the remains of it in the developed world, can have dramatic and visible effects on a country's economy.

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However, the controversy in South Korea over clauses in the FTA has led leaders of the opposition to go on protest fasts, and union supporters to take to the streets in protest.

But, increasingly, the US's agreements have also been about what the US sees as its most important 21st-century trade policy - exporting that country's view of intellectual property (IP) to the rest of the world.

Each of the US's latest FTAs have included clauses and "side letters", where both parties agree to harmonise IP law - which usually means the importation of US IP law.

After the US-Australian free trade agreement, Australian lawmakers were required to rewrite their own copyright law to criminalise technologists such as those who created tools that could circumvent copy controls, even for legitimate uses.

That turned Australia from being a country where the free development of software was a known positive advantage (one of the biggest Linux conferences and developer meetings is historically held in Australia for this reason) into a pale imitation of the US.

Not all of the American IP law has been exported, however: in particular, the "fair use" rules of US copyright that give new start-ups some leeway are not mentioned in the FTA.

This means that other countries' IP laws can become even more unbalanced. That is perfect for the US: the country remains a place where companies such as Google, Tivo and YouTube, whose business models thrive on the fair use of copyrighted material, can get a small head start, but where Hollywood can still sue to keep down foreign competition.

If there is anywhere competing with the US in the wired lifestyle right now, it is South Korea. Thanks to determined government support and a friendly regulatory environment, the country handily beats both the US and Europe in terms of internet penetration, average bandwidth and pervasive internet use.

But now South Korea has signed away some of that regulatory freedom. In a side letter to the main FTA, the country has agreed to shut down websites that "permit" copyright infringement of any kind (that's like saying that all internet content should be pre-filtered just in case it may be breaking somebody's copyright, somewhere in the world).

In particular, the South Korean government has agreed to go after P2P (peer-to-peer) and "webhard" websites. "Webhard" may sound like a sinister piracy operation when taken out of context, but the sites are in fact a perfectly legitimate, useful and widespread tech industry in Korea.

"Webhard" is short for "web hard drive" - a place where you can store files online and access them as easily as if you were copying them to a hard drive.

In an always-wired, mobile country like South Korea, such remote storage is incredibly useful: students, professionals and academics all use webhard websites to backup, transfer and collaborate. Such services are only just beginning in the West: Amazon has one in its S3 service, and Gmail's offer of gigabytes of storage has led to some people using it in this way. Apple offers a "webhard" service in its .Mac subscription, and dozens of smaller companies provide easy storage for files online.

Indeed, you could argue that any webserver host offering is a "webhard" service of a kind.

With Hollywood pressuring South Korea to pursue webhard companies, to the point of lobbying the US trade delegation to specifically highlight them in this agreement, it is unclear what the future of this industry will be in South Korea. It is also a distinct warning sign for the behaviour of these companies in other countries - including the EU.

This isn't free trade: this is turning legitimate and innovate companies into criminals at the flick of a treaty. Right now, the official opposition in South Korea is fighting tooth and claw to oppose this agreement, but it will be hard going.

American and South Korean parliamentarians can only vote for or against the treaty text - accepting it all, or rejecting it outright.

Next for a free trade agreement, it is rumoured, is Japan, another high-tech competitor for the US. Will the US be able to extinguish its internet innovators as easily? Or will those who lobby for these over-strong IP laws turn on their own, local innovators first, and start claiming Amazon and Apple as international copyright criminals?