As we move past the wreckage of last week’s SOPA / PIPA battle in Congress – one which defeated, for the time being, legislation designed to stop foreign, online “pirates” – it is important to note that, though the Internet “spoke” resoundingly against the bills, a plain fact remains: Piracy, aided by, yes, the Internet, still runs rampant.

Another important thing to point out is this: Last week’s battle isn’t the end game.

The matter can’t just be swept away because thousands of websites “blacked out” in demonstration against the bills, or because 7 million e-mails found their way to Capitol Hill, urging defeat of “Internet breaking” SOPA and PIPA. Online piracy must be meaningfully addressed or it will sink many of the most productive and innovative people and companies in our economy.

Stated more plainly, the pro-piracy status quo is unacceptable.  It cannot not be fixed (sorry on the double negative).

SOPA and PIPA are part of a larger battle, of course.  Internet piracy harms more than just the makers of movies, music and games.  When we work to protect these forms of entertainment, we’re really working to protect a form of property called intellectual property (IP) – the protection of which helps all types of creators create, knowing they have a better chance to realize a return on their private risk and investment.

Today, IP is the coin of the realm.  Not surprisingly, America leads in the development of IP, with IP-related industries representing about a third of our GDP.  Consequently, IP touches virtually every aspect of the global economy.  Inarguably, protecting IP – such as the ideas and expression that go into making PCs and the Internet’s infrastructure – have made the world better, more productive, safer and freer.  It helps bring a near endless font of solutions to the marketplace, and we’re richer for it.

By not acting to stem piracy, policymakers promote a policy of eating one’s seed corn.  That’s a false economy.

It is true – I did not support SOPA and PIPA.  This is mainly because I think that technology, consumer education tools, competition / reputation management, and industry best practices / peer group self-governance stand a better chance of dealing with policy issues brought about by technological change than do government laws, rules and proscriptions.  This flexibility beats government-imposed myopia more often than not in my book.

However, being a content creator myself – and one who relies on posting my content on the Internet for my sustenance – I have strong sympathies for those who create.  Piracy takes bread out of our mouths.  And, quite simply, calling content creators like myself dinosaurs, and then blaming us for piracy is not much different than blaming a person who has securely locked his house and valuables, but still gets burglarized.

Theft is theft, and those who steal are wrong.

What is the answer, then?

Well, I’ve been thinking about this of late, and going back to the principles noted above, I think one solution deserves a more thorough airing: Industry best practices / peer group self-governance.

A little over a year ago when I was at the Progress and Freedom Foundation (PFF), we supported one such new – and yes, surprising – Internet peer group.  Called BITAG, it was initially developed as a non-governmental response to deal with the divisive matter of Net Neutrality.  It was surprising in that its two founding members – Verizon and Google – were on opposite sides of the coin on the Net Neutrality debate.  Membership has since grown to include all the major players in the Internet economy.

Organized by ex-FCC Chief Technologist, Dale Hatfield, the group works to: 1) educate policymakers on related technical issues; (2) addresses specific technical matters in an effort to minimize related policy disputes; and (3) serves as a sounding board for new ideas and network management practices.

Importantly, as PFF’s Adam Thierer then noted:

…BITAG essentially “de-politicizes” Internet engineering issues by offering an independent forum for parties to have technical disputes mediated and resolved—without government involvement or onerous rulemakings. Consequently, this will help avoid the red tape and incessant delays that usually accompany bureaucratic resolution mechanisms, which can stifle continuous technological innovation and investments.

The diverse array of companies and organizations playing a part in BITAG makes it clear that voluntary technical dispute resolution mechanisms are not only feasible but desired by parties on all sides…

Though ultimately BITAG failed to stop government’s involvement in regulating the Internet via Net Neutrality, the body remains a working forum which shows that seemingly deeply-divided parties can come together and solve complex matters in a timely and flexible way, without the need of “going to Dad” (Uncle Sam) to solve disputes.

The Internet was built on this type of cooperation.  Notes FCC Commissioner Robert McDowell in his Open Internet proceeding statement:

[T]he Internet is perhaps the greatest deregulatory success story of all time. It became successful not by government fiat, but by all interested parties working together toward a common goal.

Though I’m not one to say legislation is never appropriate, I tend to believe that legislating technology is often a fool’s errand.  More often than not it leads to unintended consequences that are as pernicious, or even more so, than the initial policy challenges it sought to fix.

Consistent with both Thierer’s and McDowell’s statements, shouldn’t the Internet community give BITAG, or some similar non-governmental model, an earnest try to arrest online piracy?  Isn’t cooperation of this sort in our DNA?

It certainly won’t break the Internet.

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Media outlets report that the hacktavist group Anonymous brought down the websites of the DoJ, FBI, RIAA, MPAA, and others yesterday in supposed retaliation for the high-profile arrest of four accused online pirates associated with the cyberlocker company Megaupload, and, ostensibly, Congress’ efforts to pass online, anti-piracy legislation SOPA and PIPA.

The backlash to the outrageous acts of Anonymous from defenders of property will come.  It must.

It is true that I generally don’t believe that government regulation is a proper, or default manner, in which to address purported market failures or public policy challenges wrought by technological change.  In the present context, SOPA and PIPA – while seeking to correct a real problem for rights holders (as opposed to a Net Neutrality-like mirage) – are imperfect attempts to address a serious problem.

I would rather place faith in the evolution of technology, industry best practices, consumer education tools, reputation management techniques, vibrant competition and existing law to deal with the scourge of online property theft.

The "Face" of anti-SOPA and status quo, Tumblr's Andrew McLaughlin

That said, Anonymous’ actions clearly suggest to me that online piracy has become a Right on the Internet.  And this greatly unsettles me.

It is not.  It is stealing, poaching, thievery.  No one has a right to rip the bread out of content creators’ mouths.

This has me thinking – perhaps changing my mind on legislative attempts to combat online piracy. To suggest that legislation is never warranted would be foolish. Online piracy does exist and is indisputably rampant.  It may need to be that at some point Congress comes back to SOPA / PIPA  – perhaps sooner than we think – and decides that narrow legislation must go forward to bring down the digital thieves and stop their five-finger-discounting habits, ones which undermine innovation, economic growth, jobs, and the rule of law.

CNET reporter, Molly Wood, feels Anonymous’ actions may have brought that day closer, surmising:

…[A]n attack this big on this many government sites will effectively erase those good Internet vibrations that were rattling around Capitol Hill this week and harden the perspective of legislators and law enforcement who want to believe that the Web community is made up of wild, law-breaking pirates. That, ultimately, may help strengthen the business–and the emotional–case for the pro-SOPA, pro-PIPA lobby. Did the feds just get the last lulz?

Maybe she’s right.  I don’t know about new legislation, but if Anonymous has brought attention to the skenky underworld of the piracy economy, and, in doing so, boosts the idea that content creators get to decide their bundle of rights on the Internet instead of scummy miscreants, faux public interest groups, and exploitive edge providers, then so be it.

Danny Weitzner, Deputy Chief Technology Officer for Internet Policy at the White House tweeted last night:

Advocacy (web blackouts & grassroots lobbying) vs crime (anonymous DDOS attacks): one = free speech and the other = threat to freedom #sopa

Agreed.

Will the defenders of the “piracy-is-the-fault-of-the-content-providers” status quo – i.e., the Internet’s elite edge providers and their thought leaders – possess similar strength and moral clarity and forcefully condemn the alleged actions of Anonymous?  And perhaps more importantly, when this and the SOPA / PIPA dust clears, will they work in earnest  – and not just pay lip service – to help end the scourge of Internet piracy, and truly self-police the bad apples that bring such misery to the Internet?

One hopes.  The Internet, as a safe and thriving medium, depends on it. So, too, do the good brand names of Google, Tumblr, Twitter, Facebook and others that helped spawn this greedy, hate-filled, thuggish, anti-SOPA, anti-property environment – one which played no-small role in inciting Anonymous to its illegal acts of disruption.

 

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Over the past several days, the President, trying to shake off some of his Big Government inclinations, has been beating the drum about making government more streamline and efficient.

Standing in the East Room of the White House last week, President Obama noted:

…[T]he government we have is not the government we need…We live in a 21st-century economy, but we’ve still got a government organized for the 20th century. Our economy has fundamentally changed—as has the world—but our government, our agencies, has not.

And he’s made quick work to meet this challenge (again, but this time, seriously…really).  Earlier this week, the President showed Americans an example of his great progress, stating:

…[T]he FCC, prompted by our request but also due to some excellent work by Julius Genachowski, they’ve already eliminated 190 rules – 190.

Whoopee!  I guess he’s checked that box and can move on.

Not.

Regulations and bureaucracy are like a drug to Big Government officials.  The FCC’s “190 rules” liposuction is sort of like the binge drinker saying that he avoided beer at the bar – while imbibing every other top-shelf spirit the barkeep could throw at him.

By many accounts, 2011 promises to be one of the five most regulatory years in history, likely to clock in at close to 81,000 pages of new rules and regulations in the Federal Register.  2010 was about the same, posting an 18% jump in rules and regulations from the previous year.

At the FCC, instead of being the 21st century agency wished for by the President, we see one mired in the 19th century instead, regulating the information and communications technology industry as if the Robber Barons ran them.

From the FCC’s pince-nez spectacled  bureaucrats we get innovation and investment-killing Net Neutrality regulations; mandatory data roaming requirements; merger orders that impose dozens of pages of unrelated yet “voluntarily agreed to” conditions; endless reports deriding core network providers for their ostensible inability to compete or grow their networks “better”; and the ever-present threats that if one doesn’t manage one’s network in a way deemed appropriate by the FCC, then the sword of Damocles will fall, and swiftly at that.   This is not to mention non-regulation regulation, like when FCC and DoJ officials tag-teamed to kill the AT&T / T-Mobile merger because of jobs – something the NLRB seemingly has jurisdiction over – and outdated, though still facile, allegiance to their market-measuring HERFs (as well as the agency’s standing coterie of sycophantic, anti-property public interest groups and crony-capitalist supporters).

I could wind up with a long ending to this piece, but I won’t waste your time.  The sad fact is that the administration and agencies like the FCC are welded to the past.

They cannot move forward because “change” – that is, theirs, coercively imposed on markets, innovators and consumers – remains immune from the laws of economics and, ironically, real change itself.  Unlike businesses that fail and go out of business – they do not.

This past is no way to forge ahead into the future.  Trillions of dollars of investment, growth and jobs should not be held hostage to the 19th century.

Julius Genachowski – take off your pince-nez!  And, umm, Mr. President, you can remove your rose colored monocle, too.

 

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The chart, “Center for Democracy and Technology (CDT) SOPA List,” is by Terry Hart.  It shows how the Internet’s elite have highly organized an amazing subterranean latticework of connections to oppose the anti-piracy bills SOPA and PIPA, among other pro-private property initiatives here in DC and elsewhere across the globe.

According to Hart:

…The chart includes roughly one fifth of the entities and individuals on [CDT’s list of groups against SOPA], with connections indicating formal relationships between them. These relationships include funding — whether through investments, donations, or grants — institutional relationships, and individual relationships — such as employees, research fellows, or board members.

Additional organizations and individuals not on the CDT’s list are included for context. These are indicated by a red border.

From this chart it’s clear that the recent anti-SOPA / PIPA outpouring is anything but spontaneous.  The arachnid connections noted in the chart have been in the works for nearly 15 years.  Many of these same groups and relationships were involved in working to shackle Microsoft in its DoJ and EC anti-trust cases; trying to mandate “open source” software for exclusive purchase by governments to the detriment of “proprietary” companies like Microsoft; helping the FCC impose its ultra vires Net Neutrality regulations on network providers; and killing the AT&T / T-Mobile merger, to name but a few.

As I view the large graphic, it becomes evident that the Internet’s elite (mostly “edge providers”) are pretty darn good puppet-masters. Consequently, while one may or may not support SOPA / PIPA, one should be concerned about these connections.   They reveal the depth to which companies like Google exploit the “public interest” to hide their real intentions – which is, in my opinion, to marginalize the Internet’s content creators and property holders so they don’t interfere with the elites’ ability to make billions via the Internet’s sadly vibrant poacher culture (one which they have actively supported and promoted all these years, through all these connections).

This takes “vulture capitalism” to a new level.  Its complex latticework might even make Warren Buffett blush, embarrassed that he was not ever-so conniving in garnering his many billions.

 

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Free Press, Upset That Big Media Wants to Protect Its Private Property, Throws Hissy-Fit

January 13, 2012

The twitter-sphere is choked with Free Press’ latest panicked entreaty – one urging the defeat of Congress’ latest effort to curb online piracy through the House’s so-called SOPA bill. Says a couple of tweets: SOPA is everywhere on the Internet and nowhere on the nightly news. End the #SOPA blackout: http://t.co/yDbDuYqN via @freepress Mainstream media [...]

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Hooray for Kodak’s Failure

January 6, 2012

You may know that Kodak announced this week that it was likely to file for bankruptcy, ending a spectacular, world-changing 131-year run.  Once a leading brand in American life, it now sits depleted – a victim of some bad business choices that neutered its ability to deal with technological disruption. For me, this takes on [...]

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Suggested Reading: Throw Them All Out

January 4, 2012

Clocking in at a swift 176-pages, Peter Schweizer’s “Throw Them All Out” is a must read if you want to know how Washington really works (or, doesn’t, that is).  Congressional insider trading.  Legal legislative graft.  Crony capitalist hijinks.  It’s all here, and then some. Good (scary) stuff.  It’s not for the faint of heart if [...]

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CEA’s Gary Shapiro – AT&T Merger Rejection Reflects Failure of Policymakers, Politics

January 4, 2012

Quick read: CEA President, Gary Shapiro, has some interesting thoughts on the failed AT&T merger, expressed today in a Daily Caller opinion piece. States Shapiro: …Our country’s antitrust laws are ambiguous and subject to regulatory interpretation. More, antitrust officials are subject to prevailing political winds, and opposition to the deal by left-wing consumer groups was [...]

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Why 8 Months for Free Press to Respond – Incompletely – to Rep. Marsha Blackburn?

December 21, 2011

In the middle of November, anti-property group, Free Press, finally complied with Representative Marsha Blackburn’s request to see the group’s major funders.  You may remember that Free Press’ commitment began last March in testimony before Congress (audio clip here).   Now, after Rep. Blackburn asked again on November 15th, they’ve suddenly decided to get around to [...]

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AT&T Throws in the Towel on T-Mobile – Regulators, Yet Again, Hoodwink American Consumers to Benefit Competitors

December 20, 2011

The following statement may be attributed to Mike Wendy, Director of MediaFreedom.org: Alexandria, VA, December 19, 2011 – This afternoon it was reported that AT&T has officially thrown in the towel on its bid to merge with T-Mobile.  Citing insurmountable opposition in receiving regulatory approval, the company decided to go no further in its quest. [...]

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