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Americans Won’t Welcome Online-Piracy Crackdown

Jan. 19 (Bloomberg) — This month, Congress is expected to move forward on controversial legislation, the Stop Online Piracy Act (SOPA) in the House and the Protect Intellectual Property Act (PIPA) in the Senate, both aimed at halting online copyright infringement.

The shorthand version of the controversy pits Hollywood against the Internet, with the studios pleading for more power to shut down overseas pirate sites. Internet companies, in turn, are warning that those powers may stifle innovation, open the door to online censorship, and even break the addressing system that makes the Internet work. Just this week, the White House — a major supporter of increased enforcement — acknowledged these concerns.

Much of the Internet sector is late to this debate. The online enforcement push has been under way since the mid-1990s. Penalties for infringement have increased. Law-enforcement agencies have been reorganized — twice. New international treaties have been adopted. And the studios and Internet service providers have hammered out plans for large-scale online enforcement against individuals.

SOPA and PIPA are just the next steps in this larger enforcement agenda. Whatever happens to them, online enforcement will remain a very slippery slope, with attendant risks of censorship, surveillance, and the loss of due process. Because nothing in SOPA or PIPA is likely to stop piracy, there will be strong pressure to keep sliding.

Are Americans ready for this escalating war on piracy? The truth is, they have rarely been asked. My team at The American Assembly, a public-policy institute based at Columbia University, set out to correct that. In August, we commissioned a random phone survey of 2,303 Americans, ages 18 and older, to find out. (It was supported by a Google Inc. research award. The company made no contributions to the research design, had no power to approve the questions and wasn’t involved in the analysis or presentation of the results.)

We learned that most people want to obey the law. But when values conflict, strong majorities rank privacy, free speech, fear of government intrusion, and yes, sharing among family and friends ahead of copyright protection. In other words, our results show an emerging ordering of values online. Here are the details:

First, a lot of Americans are casual pirates. Among the respondents, 46 percent said they had, at some point, bought, copied or downloaded unauthorized music or video. This figure reaches 70 percent among people age 18 to 29.

But hard-core piracy is rare: Less than 2 percent had acquired most or all of a large collection that way. (For our purposes, “large” means more than 1,000 music files or 100 video files.)

We found that only 52 percent supported penalties for downloading copyrighted material, and limited this support to warnings and fines. Of those in favor of fines for illegal downloads, the amounts were quite small: 75 percent backed fines of less than $100 and 32 percent less than $10.

Only 2 percent of respondents came anywhere near the $80,000 and $22,500-per-song fines leveled against Jammie Thomas-Rasset and Joel Tenenbaum in civil cases brought by the record companies. (The final outcomes in both cases are still pending.)

Other commonly proposed penalties, such as bandwidth limits and disconnection of copyright infringers by service providers, were very unpopular, garnering only 28 percent and 16 percent support, respectively. Both, notably, are present in a recent “six-strikes” agreement between the studios and service providers, a deal that sets up a private system for warning and punishing infringers.

When we asked who should have the power to adjudicate charges of infringement, 54 percent of respondents said courts should. That’s sensible — and absent from the “six-strikes” agreement.

On the main issue in the SOPA/PIPA debate — whether service providers, search engines and other Internet intermediaries should block infringing content — we found that small majorities of Americans supported blocking (53 percent to 61 percent, depending on the wording).

There are also a lot of buts. Support drops to 40 percent if the government does the blocking. It falls to 36 percent if legal content is accidentally blocked, and declines to a mere 26 percent if surveillance of Internet use is required. There is general agreement that SOPA/PIPA would do all three.

Why this divergence between support for blocking infringing content but not for the likely consequences of the blocking? The results suggest that practices and attitudes are adjusting to a world in which distribution is cheap, copying is easy and sharing is possible — but the legal means for doing all of this have lagged. Users are also adjusting to a world in which there is vastly more media, not less, competing for limited attention and money.

In our view, arguing about whether copying a song is like stealing a car is academic. In practice, few people consider them the same.

Want some good news? Of the 30 percent of Americans who have copied or downloaded digital-music files free of charge, 46 percent said they now do so less often because of the emergence of streaming music services. And this was before last year’s launch of Spotify Ltd. in the U.S., which signed up 250,000 paid subscribers in its first six weeks. Among video downloaders, the comparable figure — the “Netflix effect” — is 40 percent.

In other words, there is a way to reduce piracy without breaking the Internet or sacrificing civil liberties. It’s called business innovation. To be fair, many in the entertainment industry say this is too facile an answer. They want to know whether the new models will be as profitable as the old ones. And fundamentally we can’t know. But we should accept that the answer may be no. Studios have made a lot of money off the DVD boom, but there was a movie business before the DVD, and there will be one after. Markets provide no guarantees, and neither should Congress.

(Joe Karaganis is vice president of The American Assembly, a public-policy institute based at Columbia University. The opinions are expressed are his own.)

Copyright 2012 Bloomberg