SOPA: So much to hate, so little time to stop it
(Updated 12/16/11 4 pm ET)
It may seem that Congress is getting exactly nothing done these days, with the game of chicken over the payroll tax and the possibility for what seems like the 537th time this year that the U.S. government may run out of money.
So you may be excused for not noticing that a full serious assault on the Internet is being considered by the House, and that it might actually see the light of day through the flotsam and jetsom of bigger business.
SOPA — the Stop Online Piracy Act — is the latest ill-considered attempt by some in Congress to solve a legitimate problem by creating an even bigger, totally unnecessary problem.
Here is the legitimate problem: There are crummy people out there who steal the creative work of others and peddle them as their own. It’s a good business for some, though, not a great a business overall. Aggrieved parties include Hollywood studios, record companies and news organizations, like Reuters and Wired: we all work hard to create stuff, don’t like it one bit when somebody steals our stuff, and pay lawyers lots of money to fight the problem. It’s a cost of doing business, and a price of the history-altering phenomenon of digitization and the world wide web.
The problem is exacerbated by the fact that the web is global: a site hosted in Uzbekistan is beyond the reach of U.S. law enforcement. So how do you stop someone way over there, or anywhere outside of the country, from streaming movies they don’t own?
SOPA, in effect, would choke such sites by doing the enforcement here, targeting customers and deputizing suppliers. It would allow private companies pressing a claim to demand that ad networks and services like PayPal and Visa stop doing business with targeted sites. It would empower Internet service providers to block access to such sites from people using their WiFi.
Until Monday, the bill, HR 3261, would have allowed this sort of cease and desist behavior without any judicial oversight. Even its chief sponsor, Rep. Lamar Smith (R-Tex), decided this was too broad and watered down the bill. At this writing the bill was being debated for final action in the House Judiciary Committee, where Smith reportedly warned the assembled to bring “a lunch and a flashlight” because the hearing could stretch into Friday.
No matter how watered down the bill may be, SOPA is still a terrible idea. It would allow the Justice Department to force ISPs to block sites. It would tamper with the blueprint of the web — the domain name registry, which keeps track of what sites are “where” — to divert traffic from sites deemed to be infringing upon copyrights.
Update: In a surprise development, the committee agreed to, in effect, put the bill on hold over concerns that altering the domain name registry would cause great damage. Smith said the hearing would resume at the “earliest practical day that Congress is in session”, which could be weeks.
While movie and record label trade groups always claim huge losses from piracy, those numbers can’t be quantified in any meaningful way. Most telling is that the industry always insists that they lost the dollar equivalent of what they would have charged someone who got “Star Trek” off an illegal torrent.
But there is no reason to believe somebody who is paying zero will pay more than zero — by definition, this would not be lost business. And most freeloaders will pay something for an experience better than a crappy pirated version — just not what the owner thinks is fair market value for a product.
This is why there is a Netflix and a Hulu and an enormous DVD business that makes billions in revenue which would not have existed if Hollywood had won the Betamax case to make the first commercially viable DVR illegal … for enabling copyright infringement.
And that’s the point. Apple didn’t disrupt the music business by insisting on a one-price-fits-all tracks and unbundling albums — it recognized that the music industry was withering away because it was trying to prop up a business model which could not be sustained given a number of outside forces. Yes, those forces included Napster. But who really won in spite of themselves (again, see above)? The Pirate Bay, where you can get anything for nothing, or Apple and the labels, which have made billions since the launch of iTunes in 2003?
Free is a compelling price point, and there will always be the contingent who won’t pay a penny more. But protecting a tottering franchise against a tiny minority and inviting the less-than-expert legislators to create rules and regulations about a medium that can’t be really be contained anyway is a recipe for disaster.
SOPA isn’t a done deal yet, but it needs to get on the radar of more non-geeky types — and fast — before this train picks up any more speed. Friend and colleague Felix Salmon may be correct that no “real” people support SOPA, but as someone pretty smart might have postulated, all evil needs to thrive is ambivalence by good.