Cite as 214 F.3d 1022 (9th Cir. 2000)
issues thus cut against one another, which forces advocates into awkward argumentative corners. Bleem, for instance, insists that the two companies do not compete with respect to any impact on profits but that they can be comparatively advertised. Similarly, Sony argues that of course Bleem’s product will harm its sales, but that it is not a competitor, so it should not therefore be allowed the benefit of comparative advertising.
What is manifestly clear, however, is that the Bleem emulator does compete directly with the Sony PlayStation console. In order to play a Sony video game, one can choose to purchase either a PlayStation console (assuming one has a television) or the Bleem emulator (assuming one has a personal computer). Thus, the greater Bleem’s sales, the less likely people will buy Sony’s consoles. Of course, people can buy both, if they prefer to play their games on a large format (televisions typically have much larger screens than computers) and if they prefer better graphics (computer screens typically have much greater resolution than televisions). Of course, to the extent Bleem’s software affects sales of Sony games, it will only do so beneficially, since a greater universe of people will now be able to play them. Nevertheless, Bleem’s software competes with Sony’s consoles with respect to both comparative advertising under the first factor and profits under the fourth.
We have not decided, apparently, any cases on the issue of comparative advertising after the codification of the fair use doctrine, but the Fifth Circuit has. The leading case involved a television commercial in which the Miami Herald displayed a cover of the copyrighted magazine, TV Guide, for the purposes of comparing it to its own analogous publication. See Triangle Publications, Inc. v. Knight-Ridder Newspapers, Inc., 626 F.2d 1171 (5th Cir. 1980). The Fifth Circuit noted that the cover of TV Guide was clearly copyrighted and the Herald had just as clearly reproduced it for a commercial purpose: to sell its own product. The court nevertheless found, after a § 107 analysis, that the reproduction was a fair use. See id. at 1178. With respect to the first factor, the Fifth Circuit noted the public benefit of comparative advertising as a means of providing more information to the public and concluded that this factor weighed in the defendant’s favor. See id. at 1175–76.
The Federal Trade Commission has also noted the social utility of comparative advertising:
Comparative advertising, when truthful and nondeceptive, is a source of important information to consumers and assists them in making rational purchase decisions. Comparative advertising encourages product improvement and innovation, and can lead to lower prices in the marketplace.
16 C.F.R. § 14.15(c) (1980). Sony does not contend that Bleem’s screen shots are untruthful or deceptive. In fact, Bleem’s comparative advertising has the potential to accomplish all the goals espoused by the FTC. First, by seeing how the games’ graphics look on a television when played on a console as compared to how they look on a computer screen when played with Bleem’s emulator, consumers will be most able to make “rational purchase decisions.” Sony argues that Bleem can advertise without the screen shots, which is certainly true, but no other way will allow for the clearest consumer decisionmaking. Indeed, Bleem’s advertising in this fashion will almost certainly lead to product improvements as Sony responds to this competitive threat and as other emulator producers strive for even better performance.
The first factor, considered in light of the animating principles of the copyright regime, weighs in Bleem’s favor. Although Bleem is most certainly copying Sony’s copyrighted material for the commercial purposes of increasing its own sales, such comparative advertising redounds greatly to the purchasing public’s benefit with very little corresponding loss to the integrity of Sony’s copyrighted material.
