Colombia Rushes Through Its Own SOPA In An 'Emergency Procedure' To Appease US Ahead Of Obama Visit

from the not-cool dept

Last fall, we wrote about how the Obama administration celebrated the signing of what they incorrectly called "free trade agreements" with Colombia, Panama and South Korea. These agreements had been the subject of significant controversy, but they did eventually get signed. Of course, the Obama administration -- via the USTR -- has long been a proponent of putting in ridiculous protectionism policies into free trade agreements. To this day, we still can't understand what copyright laws have to do with free trade. They're the opposite of free trade: they're government granted monopolies. We had warned about the excessive language in these agreements when it comes to copyright, and now we're starting to see the impact of that.

President Obama is heading to Colombia this weekend for a summit, and we'd been hearing stories that US officials had been putting tremendous pressure on Colombian officials to pass new, ridiculously draconian copyright laws ahead of that visit. So that's exactly what the Colombian government did -- using an "emergency procedure" to rush through a bad bill that is quite extreme.

Earlier this year, Colombia tried to pass basically the same bill, which was called LesLleras, after Interior Minister German Vargas Lleras (who proposed it). That bill was so extreme that it resulted in SOPA-like protests, following significant concerns raised by the public as well as copyright and free speech experts. So, this time around, the government just claimed it was an emergency and rushed the bill through, despite all of its problems. They seemed to think that the public wouldn't notice -- but they're wrong.

As is typical of idiotic trade agreements pushed via the USTR -- who only seems to listen to Hollywood on these issues -- the copyright bill includes all sorts of draconian enforcement techniques and expansions of existing copyright law, and removal of free speech rights. But what it does not include are any exceptions to copyright law -- the very important tools that even the US Supreme Court admits are the "safety valves" that stop copyright law from being abusive, oppressive and contrary to freedom of speech. Public interest groups in Colombia are planning a Constitutional challenge to this new law, but the process itself is sickening.

To use an "emergency procedure" to pass a highly questionable law that was put in place through equally questionable means and diplomatic pressure -- and to ignore the public at large -- is really astounding. I'm ashamed of my own government for its efforts to pressure Colombia into such undemocratic and anti-free speech actions.

Filed Under: colombia, copyright, free speech, free trade, obama, protectionism, ustr

How The RIAA & MPAA Are Like The Anti-Innovation German Weavers' Guild Of The 16th Century

from the protectionism,-not-innovation dept

Five years ago, we wrote a post comparing the RIAA (and the MPAA) to 17th century French buttonmakers, who used their guild to go absolutely crazy in blocking a horrifying new innovation: cloth buttons, which could be made by weavers, without making use of the members of the buttonmakers guilt. The story came from Robert L. Heilbroner's book The Worldly Philosophers (an all around excellent book if you want to learn some of the basics of the history of economics).

"The question has come up whether a guild master of the weaving industry should be allowed to try an innovation in his product. The verdict: 'If a cloth weaver intends to process a piece according to his own invention, he must not set it on the loom, but should obtain permission from the judges of the town to employ the number and length of threads that he desires, after the question has been considered by four of the oldest merchants and four of the oldest weavers of the guild.' One can imagine how many suggestions for change were tolerated.

Shortly after the matter of cloth weaving has been disposed of, the button makers guild raises a cry of outrage; the tailors are beginning to make buttons out of cloth, an unheard-of thing. The government, indignant that an innovation should threaten a settled industry, imposes a fine on the cloth-button makers. But the wardens of the button guild are not yet satisfied. They demand the right to search people's homes and wardrobes and fine and even arrest them on the streets if they are seen wearing these subversive goods."

I think the parallels to the RIAA and the MPAA are pretty self-evident. Freaking out about others entering the market? Check. Running to the government and demanding protections? Check. Expecting others to get permission to innovate? Check. Able to get government-sanctioned fines levied on those new players? Check. Feeling totally entitled to violate the property rights of others to "find" evidence of "subversive goods"? Check.

It seems this comparison between the RIAA/MPAA and protectionist, anti-innovation guilds of that era has occurred to others as well. In a recent episode of the Planet Money podcast, host Adam Davidson does a "deep dive" into the economics of a 16th century German weavers' guild and discovers the same patterns. Collusion in the guild to keep out innovation, to artificially limit the market, to keep wages of employees down and, most importantly, the first response to any competitive threat is to run to the government and lobby for greater protections.

The comparison to the RIAA and MPAA is so obvious that Adam Davidson calls it out pretty early on in the discussion, noting that these "guilds" don't seem all that different from those two groups today. Of course, given that they're both built on copyright law, which originally was designed as a protectionist tool for a similar publishers guild, perhaps the similarities aren't too surprising.

Filed Under: guilds, history, lobbying, protectionism
Companies: mpaa, riaa

Lithuanian Minister Of Justice Says ACTA Is Unnecessary, Doesn't Actually Help Creators And It's Time To Reevaluate IP

from the nicely-said dept

Here's yet another example of a European official speaking out against ACTA. However, unlike in many other countries, where it appears to be politicians merely pushing back on public backlash, and urging caution and public review, the Lithuanian Justice Minister, Remigijus Simasius, has completely condemned ACTA and said that it should lead to a wholesale re-evaluation of IP rights system itself.

The essence of my comment was that certain provisions of ACTA are new to our legal system (more severe punishment, more control of internet providing services) and I do not see why those provisions are necessary.

I have also stated that our life is more and more dependent on R&D, new inventions, creativity. Existing IP protection system, however, is more about protecting the IP protection industry than a protection of inventors and authors. Current debate worldwide is a clear sign that we have to re-evaluate the existing IP rights system.

While it'll be interesting to see how far all of this goes, it's quite notable just how much backlash the SOPA overreach is suddenly creating -- where all sorts of skepticism about existing copyright law is suddenly coming out in more mainstream places.

Filed Under: acta, ip, justice minister, lithuania, protectionism, remigijus simasius

MPAA Exec Admits: 'We're Not Comfortable With The Internet'

from the and-it-shows dept

There have been a ton of post mortems about the whole SOPA/PIPA fight, with many trying to figure out where and how the MPAA "went wrong." After all, this is a group that is very used to getting its way inside DC. And it got slaughtered. We've already discussed our thoughts on why the MPAA failed, but what stuns me is how every time someone from the MPAA opens their mouth, they seem to make the situation worse by demonstrating just how tone deaf they are to the online community and what their concerns were. Whether it's just blaming Google or thinking that the solution is more backroom dealing, each response just sounds like a group of people who are playing a different game, and still don't realize the rules have changed.

The Hollywood Reporter's version of the postmortem is a good read, even though it covers much the same ground as many other such recaps. Still, it's worth reading to get a good feel for Hollywood's view of the world. But the really stunning part is the quote from Michael O'Leary, the MPAA's number two guy, who makes what may be the most tone-deaf statement we've seen to date in this fight:

The MPAA's O'Leary concedes that the industry was out-manned and outgunned in cyberspace. He says the MPAA "is [undergoing] a process of education, a process of getting a much, much greater presence in the online environment. This was a fight on a platform we're not at this point comfortable with, and we were going up against an opponent that controls that platform."

Yes, even when he tries to say that they're trying to learn about that confounded internet thingy, he sounds ridiculous and dismissive. But the real point is his inadvertent admission within that statement: the MPAA (and the rest of "old" Hollywood) simply "is not comfortable with" the internet. And that's really what SOPA and PIPA were about. Rather than trying to understand this new platform, and learn from the many entertainers who do get the internet, they did what the MPAA does and simply tried to regulate that which they don't understand and fear.

Furthermore, even more ridiculous is the end of that sentence: "an opponent that controls that platform." As the article makes clear, he means Google. Which shows that he still doesn't get it. First, Google didn't lead the protests. It came late to the game, after the grassroots had already taken off with this stuff and run with it. But, more to the point, contrary to what O'Leary and the MPAA seem to believe: Google does not control the internet. No one does.

This, of course, explains why the MPAA wants to "negotiate" with Google these days. But that's not going to work. The folks on the internet don't want a backroom deal, whether it's negotiated by Google or someone else. Either way, this suggests that the MPAA is desperately in need of new leadership. They need leaders who don't try to regulate that which they admit they don't understand. They need leaders who aren't so clueless as to think that Google controls the internet (or that Google is somehow "the enemy"). And, really, most important, they need leaders who recognize and understand that the internet is their future too -- and any leadership needs to not fear the internet, but understand it and learn to embrace it. Unfortunately, it doesn't seem likely that the MPAA is going to find such leadership any time soon.

Filed Under: control, michael o'leary, pipa, protect ip, protectionism, sopa
Companies: mpaa

Tim O'Reilly Explains Where The Federal Gov't Has Gone Wrong On SOPA/PIPA: Solving The Wrong Problem

from the indeed dept

A few months back, in going into great detail on everything wrong with PIPA & SOPA, I started it off by explaining that the whole effort was attacking the wrong problem. Here's what I wrote at the time:

That main issue, we're told over and over again, is "piracy" and specifically "rogue" websites. And, let's be clear: infringement is a problem. But the question is what kind of problem is it? Much of the evidence suggests that it's not an enforcement problem and it's not a legal problem. Decades of evidence from around the globe all show the same thing: making copyright law or enforcement stricter does not work. It does not decrease infringement at all -- and, quite frequently, leads to more infringement. That's because the reason that there's infringement in the first place is that consumers are being under-served. Historically, infringement has never been about "free," but about indicating where the business models have not kept up with the technology.

Thus, the real issue is that this is a business model problem. As we've seen over and over and over again, those who embrace what the internet enables, have found themselves to be much better off than they were before. They're able to build up larger fanbases, and to rely on various new platforms and services to make more money.

And, as we've seen with near perfect consistency, the best way, by far, to decrease infringement is to offer awesome new services that are convenient and useful. This doesn't mean just offering any old service -- and it certainly doesn't mean trying to limit what users can do with those services. And, most importantly, it doesn't mean treating consumers like they were criminals and "pirates." It means constantly improving the consumer experience. When that consumer experience is great, then people switch in droves. You can, absolutely, compete with free, and many do so. If more were able to without restriction, infringement would decrease. If you look at the two largest contributors to holding back "piracy" lately, it's been Netflix and Spotify. Those two services alone have been orders of magnitude more successful in decreasing infringement than any new copyright law. Because they compete by being more convenient and a better experience than infringement.

Tim O'Reilly (who you should know already), who makes his living in the content business, but has always been against these kinds of ridiculous laws, has come out with a great, detailed discussion of the same issue, concerning how the federal government still has mis-defined the problem. He's doing this in response to the White House's statement on Saturday, and makes some important points:

I found myself profoundly disturbed by something that seems to me to go to the root of the problem in Washington: the failure to correctly diagnose the problem we are trying to solve, but instead to accept, seemingly uncritically, the claims of various interest groups. The offending paragraph is as follows:

"Let us be clear—online piracy is a real problem that harms the American economy, and threatens jobs for significant numbers of middle class workers and hurts some of our nation's most creative and innovative companies and entrepreneurs. It harms everyone from struggling artists to production crews, and from startup social media companies to large movie studios. While we are strongly committed to the vigorous enforcement of intellectual property rights, existing tools are not strong enough to root out the worst online pirates beyond our borders."

In the entire discussion, I've seen no discussion of credible evidence of this economic harm. There's no question in my mind that piracy exists, that people around the world are enjoying creative content without paying for it, and even that some criminals are profiting by redistributing it. But is there actual economic harm?

From there, he talks about his own experience running a content business, and how he's learned that any actual infringement tends to benefit him in the long run. That's because, like I explained above, if you put in place a smart business model (something Tim is good at) piracy is no problem at all. O'Reilly is fond of the phrase that "obscurity is a bigger problem than piracy" and he's completely right:

In my experience at O'Reilly, the losses due to piracy are far outweighed by the benefits of the free flow of information, which makes the world richer, and develops new markets for legitimate content. Most of the people who are downloading unauthorized copies of O'Reilly books would never have paid us for them anyway; meanwhile, hundreds of thousands of others are buying content from us, many of them in countries that we were never able to do business with when our products were not available in digital form.

History shows us, again and again, that frontiers are lawless places, but that as they get richer and more settled, they join in the rule of law. American publishing, now the largest publishing industry in the world, began with piracy. (I have a post coming on that subject on Monday.)

From there, he starts talking about what the White House should be doing, and it's simple: look for ways to allow innovation to flourish -- not create protectionist plans for industries who aren't keeping up with the times:

Congress (and the White House) need to spend time thinking hard about how best to grow our economy - and that means being careful not to close off the frontier, or to harm those trying to settle it, in order to protect those who want to remain safe at home. British publishers could have come to America in the 19th century; they chose not to, and as a result, we grew our own indigenous publishing industry, which relied at first, in no small part, on pirating British and European works.

If the goal is really to support jobs and the American economy, internet "protectionism" is not the way to do it.

It is said (though I've not found the source) that Einstein once remarked that if given 60 minutes to save the world, he would spend 55 of them defining the problem. And defining the problem means collecting and studying real evidence, not the overblown claims of an industry that has fought the introduction of every new technology that has turned out, in the end, to grow their business rather than threaten it.

He also has a final suggestion that may seem unrelated, but is actually directly at issue:

If Congress and the White House really want to fight pirates who are hurting the economy, they should be working to rein in patent trolls. There, the evidence of economic harm is clear, in multi-billion dollar transfers of wealth from companies building real products to those who have learned how to work the patent system while producing no value for consumers.

But, of course, that will never happen. That's because a totally useless "patent reform bill" passed a few months ago, and Congress and the President now consider that problem "done." And that's even though nothing in the bill actually addressed the issue of patent trolls, which has been a huge problem, and has hit many of the new businesses that are needed to build the innovations that will help the old guard in the content industry adapt. Hell, just look at Spotify. Days after being introduced in the US... it was sued for infringement.

So, the real response to the White House should be that it's time to stop making this a faith-based debate. Let's focus on the actual evidence, and define what the actual problem is. Because if it's (as all the evidence shows) a business model problem, not a legal or enforcement problem, pushing forth new regulation is not going to be the answer.

Filed Under: business models, copyright, economics, internet, laws, legislation, pipa, protect ip, protectionism, regulation, sopa, tim o'reilly, white house

Will Anti-Free Trade Protectionist Agreements Be Bad For US Citizens Too?

from the do-they-know-what-they're-doing? dept

As we've noted, the US has been using multilateral and bilateral negotiations conducted in secret as a way to craft some very one-sided trade treaties. They seem to offer pretty raw deals to the other nations involved – and correspondingly great ones for the US copyright and pharma industries. But could they turn out to have direct negative consequences for US citizens as well?

For example, recently Techdirt reported on the pharmaceutical price-fixing scheme contained in a leaked version of the Trans Pacific Partnership agreement. The way it is framed there would seem to imply that the Federal Medicaid program's preferred drug lists would be forbidden. Whoops.

And here's a troubling clause found in the bilateral trade agreements recently signed with Colombia, Panama, and South Korea:

Another section (PDF) of the trade deal seems to recognize only a limited right by Americans to create and use computer programs of their choice.

It says: "Each party recognizes that consumers in its territory should be able to...run applications and services of their choice, subject to the needs of law enforcement."

A U.S. trade official, who did not want to be named, told CNET that the language is "hortatory" and therefore not binding--in other words, it's a recognition, not a commitment to actually do anything.

Hortatory it may be, but it's there. Who's to say that the US government won't one day use the treaty as an excuse to make it happen?

The problem is that none of these back-room treaties has had the benefit of detailed scrutiny by outside experts while they were being drawn up; as a result, they may well contain clauses with unintended consequences further down the road. That's yet another reason for much more transparency during negotiations - or for avoiding them altogether.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

Filed Under: anti-free trade, free trade agreements, protectionism

Broadcasters Ask Brazilian Government To Protect Them From Interesting Foreign Content On The Web

from the good-luck-with-that dept

Last week Techdirt wrote about a draft of a civil rights-based framework for the Internet that is being considered by lawmakers in Brazil. It seems like the Brazilian Radio and Television Association didn't get around to reading it, because they want the government there to "regulate" foreign web content flowing into the country (Brazilian news report):

The Assembly of the International Broadcasting Association today approved a resolution tabled by the Brazilian Radio and Television Association (BRTA) asking the Brazilian authorities to regulate the production and distribution of media content entering the country via the Net.

The BRTA accuses foreign groups of producing journalistic content and entertainment, violating Article 222 of the Federal Constitution, which limits foreign ownership of media companies and broadcasters to 30%.

According to the resolution the failure of the regulatory framework represents a "grave violation of Brazilian sovereignty."

There are a few issues here.

First, the flow of material from outside the country doesn't really have anything to do with ownership of media companies: it might come from a TV company's web site in Portugal, say, but is just as likely to be on YouTube, or on some random web server in someone's bedroom. Trying to regulate it using media ownership laws is about as sensible as, well, trying to tell people what videos they can watch on the Internet.

Moreover, framing this in terms of "violations of Brazilian sovereignty" is just silly: it's seeking to turn a simple fact about the global nature of the Internet into an affront to national pride in an attempt to gain some political advantage. It's nothing of the kind, it's just the reality of the online media world today; the sooner the BRTA gets used to that, the easier it will be for its members to thrive there.

The real issue here is why Brazilians have started watching so much foreign content on the web: could it be that they find home-grown stuff rather dull in comparison? Rather than calling for government intervention, perhaps the Brazilian television and radio companies should spend more time seeking artistic inspiration.

Follow me @glynmoody on Twitter or identi.ca, and on Google+

Filed Under: brazil, culture, protectionism

Should We Pass A Law To Stop Yelp From Harming Chain Restaurants?

from the the-internet-enables-niches dept

We keep hearing stories about how "the internet is killing music" or "the internet is killing newspapers," which inevitably seem to suggest that "something must be done," and often that "something" involves the government getting involved. Of course, if you look at the details, you realize that the internet isn't killing music or journalism at all. In many ways it's just changing both and enabling new means of creation, distribution, promotion and sales. But, people like to interpret the struggles of one part of an industry, and pretend that represents the wider industry -- and then insist something must be done.

But, of course, one part of an industry becoming obsolete due to technology and market changes is the natural path of disruption, and not a cause for concern. Just to highlight this point, it's worth pointing to a Washington Post article with the title, How Yelp is killing chain restaurants. It refers to a study (pdf) that looked into the impact of Yelp reviews on restaurants. Among its many findings was that the market share of big chain restaurants appears to have declined.

When you think about it, this is not surprising at all. Part of the reason why chains are successful is because they offer familiarity, which allows potential diners to trust that the food they'll get at them will be of a certain quality. If you're unsure where to go, and want to minimize the risk, you are more likely to just hit up a big brand you're familiar with. But Yelp changes the equation. Now you can get an approximation of trust in a restaurant you've never heard of. It's not perfect, but it certainly decreases the risk, and thus increases the likelihood that you'll try a smaller alternative. At the same time, there's little that Yelp is likely to do to increase the attractiveness of a chain restaurant.

Of course, there's a wider parallel to other industries as well. We've heard some fears that the internet creates too many "winner takes all" situations, with a single dominant player, but the reality often seems quite different. It creates the ability to build a multitude of niches, because information decreases the risk of trying someone new or different. So rather than relying on a major record label to spoon-feed you the next big hit, you can find more niche music that you like. Rather than relying on the mainstream press for your news coverage, you can seek out alternative viewpoints. The rise of the internet and the ability to share information means that things are less likely to consolidate into single large players, because the reasons for such large entities often is undermined by more widespread information.

Filed Under: chain restaurants, protectionism
Companies: yelp

Hitch Your Wagon

from the Intellectual-Pooperty dept

This is a metaphor.

Filed Under: competition, culture, protectionism

Administration Bangs The Drum In Support Of Needless Protectionism On World IP Day

from the you're-doing-it-wrong dept

Well, today was "World Intellectual Property Day," and I had hoped to just ignore the whole thing, but, as was expected on such a day, the politicians were out in force, talking up the importance of "protecting intellectual property," with none of them really discussing the key issues: whether or not that sort of protectionism really is good for the economy, or the growing body of economic research that shows it is not. At all. Instead, we just get the same statements based on the old myths of intellectual property. Outgoing Commerce Secretary Gary Locke gave a mildly bland statement on the "critical importance" of such protectionist policies. But the really bizarre statement came from James Cole, our recently appointed Deputy Attorney General, who really takes the cake for ill-informed rhetoric concerning innovation and intellectual property.

This country has a deep and rich history of developing innovative products and groundbreaking inventions that have helped to shape our world. Intellectual property is one of America's greatest assets and protection of these assets is vital to our economy, our health, and our legacy.

Thing is... the first sentence and the second sentence have little to do with one another. Our deep and rich history is not because of our intellectual property laws. In fact, much of our history involved very weak IP laws (some of which allowed us to industrialize faster). Recent studies, such as those by Eric von Hippel at MIT, have shown that the vast majority of productive innovation is done for reasons that have nothing to do with intellectual property laws. So why would Cole make such a statement?

Today, as we recognize the 11th Annual World Intellectual Property Day, we celebrate the creativity and innovation of American music, literature, film, art and the inventive spirit that have set this country apart. The growth of new technologies, increased broadband access to the Internet and global manufacturing distribution channels provide increasing opportunities to market American products and creative content around the world.

Yes, and much of that had nothing whatsoever to do with intellectual property laws. In fact, much of it happened in spite of intellectual property laws. The whole film business was launched on the basis of trying to hide from Thomas Edison's patents.

Yet, on this day we must also recognize that there are those who exploit these same technological advances to profit illegally from the hard work of American authors, artists and inventors through criminal copyright infringement, trademark counterfeiting, trade secret theft, economic espionage, and other intellectual property (IP) offenses.

Like the founders of Hollywood? Like Disney, exploiting our cultural heritage and then locking up those works?

Unfortunately, criminals rely upon American consumers to buy their counterfeit goods. According to recent research from the National Crime Prevention Council, most Americans do not fully understand the scope or consequences of intellectual property crime and are susceptible to being swayed by the lure of a bargain, especially in these tough economic times.

Actually, multiple studies have shown that counterfeiting isn't really that big of a problem. It's not that American's don't understand the scope. It's that industries who benefit from excess gov't protectionism have massively inflated the actual problem and most consumers recognize that these concerns are bogus. They know when they're buying a fake purse, and no harm is being done to them or the original brand. The purchase is often aspirational in that they buy the counterfeit when they can afford it, knowing that when they get enough money, they'll buy the real version. In fact, studies have shown that massive numbers of counterfeit purchasers go on to buy the real thing within just a few years. You would think this info would be relevant. Why does Cole ignore it?

As chair of the Department's Task Force on Intellectual Property that Attorney General Eric Holder established last year, I know we must continue to work to change the perception that IP crime is risk-free and victimless through aggressive criminal enforcement of laws designed to protect the American public and ensure the quality of products reaching consumers. Intellectual property crime contributes to the loss of hundreds of thousands of jobs, costs our economy billions of dollars annually and exposes Americans to potentially dangerous products, affecting public health and safety and national security.

Almost nothing in this paragraph is accurate. The "loss" numbers, in both jobs and dollars has been widely debunked. The studies mentioned earlier point out that in many, many cases it is a victimless issue. And, at most, this should be a civil issue between a rightsholder and an infringer. The government has no place in this.

The task force has sought to strengthen IP protections through an increased focus on domestic and international enforcement and better coordination with our state and local law enforcement partners. We've made significant strides to obtain convictions of online distributors of counterfeit pharmaceuticals; large-scale producers and smugglers of counterfeit goods ranging from luxury items to military-grade computer system hardware; distributors of pirated digital movies and music; and those who have misappropriated highly-valued trade secret information from American corporations.

Note the conflation of very, very different types of issues. Also note the ignoring of the massive due process and First Amendment violations that happened in the process of seizing domains from those falsely accused. Gee... I wonder why.

The risk to the public of counterfeits is clear.

No, actually, it's not. There are a few specific cases where there is a risk: genuinely fake medicines (not grey market imports) and counterfeit military & safety equipment. But those are very, very small issues. And yet they're used to give Cole's Justice Department a wide berth in stomping on people's basic rights, turning civil, non-commercial issues into bogus criminal indictments, and taking questionable steps that appear to contradict basic free speech and due process principles.

Though we have accomplished a great deal, we recognize that we cannot rest on what has been done. The attorney general and I are committed to continuing to do more and with your help, we will hold accountable these criminals, protect the American public and safeguard one of America's greatest assets.

Please, don't. You're making things worse, not better. You're encouraging innovation to avoid the US and go elsewhere. You're making the US the laughingstock of the world by seizing domains and censoring the internet while pretending to be in favor of free speech. Innovation does not work by "protecting" anything. It's about enabling. And the DOJ is doing the opposite of that.

Filed Under: intellectual property, james cole, obama administration, protectionism