What Happens in the Cloud - Software as a Service and Copyrights

What happens in the cloud? Copyright owners are concerned. Users of cloud services upload, share and download copies of software and other files without their permission and access copyrighted works beyond or in violation of access limitations. Providers of cloud services are deploying novel technologies that make copyrighted works available in new formats and business models. What happens in the cloud, stays in the cloud. In the cloud, software is no longer commercialized by way of distribution of copies to users. Instead, users remotely access and use software copies that remain on the cloud provider’s servers. Software copies stay in the cloud. This raises questions as to if and how the interests of software copyright owners, users and the public are protected by copyright law in the cloud and whether the complex system of rights, defenses and exceptions that courts developed in the context of software distribution can function in the cloud. To answer such questions, one has to first understand what exactly happens in the cloud in terms of copying. This article takes a close look at the question what happens in the cloud to help determine whether copyright law can continue to work well for software. Section I begins with a technological overview. Section II assesses when and how the exclusive statutory rights under U.S. copyright law are implicated in a software-as-a-service context. Section III examines the situation under copyright laws in Europe for comparison purposes. Section IV takes a brief look at complexities introduced in cross-border scenarios. Section V concludes with a brief review of practical implications