US Copyright legislation – why should we care?

The US government is currently tabling some very aggressive copyright legislation that could affect the free flow of information and cut off websites that infringe on copyright. This will have a flow on effect to the web as a whole and the UK.

Read CBR’s story for an explanation of SOPA and PIPA copyright bills here.

Why do we care? Insomuch as most of the internet’s popular infrastructure is based in the US, such as Google, Amazon, Facebook and Apple. At the more esoteric end, this kind of legislation has the habit of rolling into other countries by way of informal precedent.

The UK’s own copyright law is currently under consultation – it hasn’t been amended since 1991. It doesn’t allow for the existence and use of iPods – UK citizens literally aren’t legally allowed to copy CDs to their iPods, or store music in the cloud. Theoretically, if the Government took action, it could kick Apple out of this country tomorrow.

This is not only worrying in terms of our individual liberties, but it is crushing innovation. Local company Brennan’s JB7 is required to warn consumers that they will breach copyright by using the device. Technical criminality is hardly a selling point for a start-up.

Prime Minister David Cameron has announced that the changes to our Copyright Law will be to help foster technological innovation. The Government is also looking at a digital copyright exchange.

But who knows what else might turn up in the fine print once these pieces of legislation reach the house?

The UK’s Digital Economy Act 2010 forces ISPs to cut off the connections of consumers for file sharing, which has seen ISPs such as TalkTalk and BT challenge it in court, unsuccessfully.

Given the ‘special relationship’ between the UK and the US, if the US’s SOPA bill passes, how long before more crazy copyright stipulations turn up in any trans-Atlantic trade negotiations or treaties?

As an example, when New Zealand updated its copyright laws in 2008, section 92a similarly forced ISPs to cut off the internet connection of anyone caught downloading copyrighted material. This included accusation without proof. New Zealand’s Prime Minister John Key claimed the stronger copyright laws were required for ‘New Zealand to be able to negotiate a free trade agreement with America.’

The American government has also pushed the Swedish authorities to shut down Pirate Bay, the world’s most popular torrent website.

So yes, America’s legislative agenda has the potential to affect users here too.

The SOPA and PIPA bills are at once so complex, yet so vague, that it is very hard to discuss the bills’ limitations, let alone explain its repercussions to the average punter on the street.

The American political machine has done very well to present the argument as a battle between two greedy, rich parties – the content providers (Hollywood, the music industry) and the content aggregators (Google, Facebook), this covers any politician from being associated with crushing individual liberties – a cardinal sin in the land of the free.

Basically these Copyright Bills are the same nonsense trotted out every 2-3 years once a politician gets some lobbyist money in his back pocket. Maybe this time round they were hoping constituent fatigue would make us ignore it? Perhaps that the diverted attention of struggling workers during the world recession would mean the Hollywood elite could slip a few dodgy laws onto the floor?

For once, the EU seems to be more progressive. European Commission Vice President for the Digital Agenda, Nelie Kroes, has simply said that the current system is broken.

But what really bothers most of my generation in tech circles is the idea of these ridiculous old men (the politicians I mean) being taken advantage of by corporate lobbyists. These politicians have absolutely no idea what they’re talking about when it comes to technology; they barely know what the internet is, have never used an iPod, and usually don’t even know what the legal definition of copyright is. For the record, copyright infringement is not the same as theft.

So now we have famous examples of 88 year old Alaskan senator Ted Stevens describing the internet as a series of tubes. This quickly became an internet meme.

We have News Corp’s Rupert Murdoch making inane comments on Twitter such as "Piracy leader is Google who streams movies free, sells advts around them. No wonder pouring millions into lobbying" (SIC), and "Obama has thrown in his lot with Silicon Valley paymasters."

There’s a reason we use the terms ‘old media’ and ‘new media’ these days. Most tech companies have managed to adapt and diversify in the internet age quite well. ‘New Media’ such as Amazon, Apple’s iTunes and Valve’s Steam for example, have both managed to make a ton of money in their online stores by giving consumers what they want – on demand content at a reasonable price.

To put it simply, these ‘old media’ companies that are pushing these copyright bills really can’t be bothered running their businesses properly. They are like spoilt trust fund children who inherit a business, and then want to continue to receive the kickbacks while running it with a minimum of effort.

While I sympathise with the ‘plight’ of copyright holders, they are hypocrites. They make all these free market business arguments when it suits them, while actually pursuing state interventionism as a form of protectionism for their industry – often hiding behind ‘struggling artists’ as a defence.

These companies want to preserve a pre-internet business model. Full stop.

Anyone with a passing grade in high school will understand supply-demand economics, and therefore understand where these businesses have gone wrong.

In the early days of the internet, it was too hard to obtain goods (i.e. physical copies of obscure music) so consumers found online alternatives (Napster). The music industry did not respond, so this relatively benign behaviour became entrenched.For right or wrong, it became the standard.

When the music industry did finally panic as their sales fell, they retaliated so viciously in the courts it provoked widespread opposition – even ending up on evening newscasts. They did not engage consumers and attempt to build a solution, or lower their prices, they attempted to punish those that didn’t play by their rules. The market, at this point, was not determining the real price of goods.

This aggressive response created a rebel culture, especially amongst teenagers. It became ‘cool’ to share music. Music had lost much of its value as a commodity.

Instead of attempting to rebuild the commodity’s value, by catering to the needs of consumers, the industry made the assumption that every one of the customers was a potential thief, which really is no way to run a business.

This saw companies crippling their own products with malware and crippleware (See the Sony-BMG Rootkit scandal in 2005). For the first time, this actually meant that the pirated goods (which were free of corporate spyware) were superior, as well as cheaper, than the original retail good.

As the industry’s responses became more and more vicious, it has also provoked a cultish response – copying for the sake of ‘sticking it to the man’ – which is where we are now. The Swedish Pirate Party won two seats in government in the 2009 election. It now has an affiliate in the UK. People actually hack DVDs, videogames and CDs now for fun – as coding practise. They even see it as their right.

What we basically saw was a negative branding exercise by these companies. Consumers started very consciously deciding NOT to buy goods from companies seen as mean spirited. Consumers now take pleasure in the suffering of nasty super-conglomerates like TimeWarner-AOL (when it existed) and Sony-BMG. The anti-globalisation movement also helped here. Consumers now passionately support ‘cool’ or modern companies such as Apple and Google much more readily.

The same pattern that wrecked the music industry, and the video game industry before that, is now happening to the movie industry. These multi-billion dollar industries have all joined forces, and, contrary to their pro-business, free-market rhetoric, again want protectionism from the Government and, by proxy, the taxpayer.

Yes, these are the same hypocrites that complain about high corporate tax rates as an unwanted government intervention, while demanding the Government invest heavily in the tech sector to support growth. You can’t have it both ways.

The internet has turned the business world on its head. Technologists have been talking about this moment for decades, and these industries weren’t willing to listen or adapt. We saw it in the 80s when the MPAA attacked Sony‘s Betamax video recorder. Sad then that Sony is now on the other side of the fence.

The government should not be there to administer to corporate welfare for poor business practises – we’ve seen what happens there with the global financial crisis, which is still running strong three years later.

Companies have to be allowed to be pressured, to be able to fail, or they have no incentive to be better. Apple learned that the hard way in the 90s. Why can’t any of these companies?

Type: White Paper


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