Technology: A bipartisan attempt to regulate the Internet?

October 26, 2011 |  6:44 pm

 

Leaders of the House Judiciary Committee introduced a beefed-up version Wednesday of the Senate Judiciary Committee's proposed Protect IP Act, offering Hollywood new tools to go after foreign piracy hotbeds -- as well as opening online storage, content-sharing and auction sites in the U.S. and elsewhere to attack from copyright and trademark owners.
The 78-page Stop Online Piracy Act (HR 3261) boasts a rare degree of bipartisan support, reflecting the combined influence of such backers as the U.S. Chamber of Commerce and the Motion Picture Assn. of America. But it drew an even sharper outcry from tech-industry advocates than the Protect IP Act.
Both measures would let federal prosecutors seek court orders shutting down foreign websites that are dedicated to piracy. Those orders would require Internet service providers, online advertisers and payment systems to redirect traffic and dollars away from the sites.
There's broad support for cutting off the financial lifeline for piracy hotbeds. But the bills' requirement that ISPs try to block their customers from reaching those sites has drawn opposition from an array of technology companies and networking engineers, who warn that it would encourage consumers to use alternate domain-name servers. That, in turn, would fragment the domain-name system and stymie efforts to make the Net less hospitable to malware.
Tech companies are also concerned about the power the Senate bill would grant to copyright holders to seek injunctions against sites they believe are dedicated to infringing activities -- a description that Viacom's attorneys could well have applied to YouTube before it started automatically checking uploads against a database of copyrighted works. But the private right of action in the House bill makes the Senate provision seem tame by comparison.

Labeling their approach a "market-based system" to protect consumers and property owners, the authors of HR 3261 would require advertisers, credit card companies and other payment processors to stop providing ads or payment services to any site that a copyright or trademark holder claimed was "dedicated to the theft of U.S. property." No court would need to be involved unless the operator of the site filed a counter-notice asserting that it didn't fit the bill's definition of a dedicated infringer.
That definition is so broad, it could snare all sorts of cloud-based services, said Markham Erickson, executive director of the NetCoalition tech advocacy group. The problem starts with the bill's focus on Web "sites," which as a technical matter can be a single page within a domain. An eBay listing could be considered a "site," as could a Facebook timeline, a Flickr page or a Dropbox folder.
Making matters worse, the bill broadens the notion of what it means to be "dedicated to the theft of U.S. property." In addition to sites that are primarily designed or marketed for infringing uses, the bill's definition includes sites whose operators "avoid confirming a high probability" that they will be used to infringe or who had at any previous time promoted infringements.
According to Erickson, the only way for ad networks and payment processors to respond to a notification about a supposedly offending site would be to block service to the entire domain. Hence, "you can shut down YouTube, you can shut down internet commerce sites, you can shut down hosting sites" for infringements on just a fraction of their pages, Erickson said.
The MPAA disagreeswith Erickson's view of what constitutes a "site," arguing that there could be no confusion between what lawmakers are targeting and legitimate online services. But the liability the House bill would create for operators who "avoid confirming a high probability" of infringing uses implies a new duty on Web sites and services to police themselves and their users. Such a duty, Erickson said, would reverse the safeguards provided by the Digital Millennium Copyright Act in 1998. Those safeguards have been crucial to cloud-based services and providers of online platforms.
"This bill is a direct attack on technology," Erickson said. "Technology that allows for sharing of informtation ... anything that could foster infringement can be covered by this bill. To me, that's the headline of this. This is a dramatically different approach from what we've seen."
David Sohn, senior policy council of the centrist Center on Democracy and Technology, offered a similar assessment:

This bill raises serious red flags. It includes the most controversial parts of the Senate's Protect IP Act, but radically expands the scope. Any website that features user-generated content or that enables cloud-based data storage could end up in its crosshairs. ISPs would face new and open-ended obligations to monitor and police user behavior. Payment processors and ad networks would be required to cut off business with any website that rightsholders allege hasn't done enough to police infringement. The bill represents a serious threat to online innovation and to legitimate online communications tools.

Advocates for copyright and trademark owners disagreed, calling the bill an appropriate response to the serious threat posed by overseas piracy hotbeds.
Cary Sherman, head of the Recording Industry Assn. of America, had this to say about HR 3261, which was introduced by House Judiciary Committee Chairman Lamar Smith (R-Texas):

This legislation is a first step towards a brighter day when these rogue offshore websites can no longer duck accountability under U.S. laws, all the while providing a critical boost to the marketplace for legal digital music services.  The Smith bill sensibly requires relevant parties to work together to address the collateral damage caused to everyone involved in legitimate online commerce and appropriately complements other voluntary efforts already underway.  Notably, the bill also allows reasonable flexibility for ISPs in determining the most appropriate technological manner for blocking illegal sites and provides ample legal safeguards for sites accused of infringement.  

Here are a few more examples from supporters:
“Websites that blatantly steal the creativity and innovation of American industries violate a fundamental right to property. Operators of rogue sites threaten American jobs, endanger consumer safety, and undermine the vitality of the online marketplace."
-- Thomas J. Donohue, chief executive of the U.S. Chamber of Commerce
 “Online theft in the U.S. and overseas threatens the independent film industry and must be stopped. For the Independents, who finance films by pre-selling the rights to distributors worldwide, the drastic damage caused by online theft is measured both in films that cannot be produced and in lost returns on investment in films that have been produced.  Independents account for 70% of all U.S. film production, so every independent film that can’t be financed and produced has a dramatic impact on jobs and the economy.  We appreciate the House Judiciary Committee’s serious bipartisan work in bringing this bill forward to address both rogue websites and felony streaming, and we look forward to working with them to ensure that strong measures are adopted.”
-- Jean Prewitt, chief executive of the Independent Film &Television Alliance
“The Internet is an important tool which has opened opportunities for our industry from distribution to marketing to connecting with fans, but there is a segment of web operators who are criminals, pure and simple, and we must do more to stop them. Current laws tie the hands of both law enforcement and judicial personnel in many instances, to the detriment of American business and consumers. Legislation introduced today in the U.S. House would help fix that, enabling our justice system to go after criminal operatives."
-- David Israelite, chief executive of the National Music Publishers Assn.
The most interesting thing to me about the bill is that, after more than a year of talks among lawmakers, copyright and trademark interests and tech-industry lobbyists, Smith offered a bill that pushes the sides even further apart. The measure isn't likely to run into the usual partisan snarl that kills so many pieces of legislation these days; copyright issues don't break down along party lines. Instead, this one will test the relative clout of copyright and trademark holders against Google, Silicon Valley entrepreneurs and the hands-off-the-Internet crowd. There's consensus to be had on combating the likes of The Pirate Bay, but it's not to be found in HR 3261.

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