As Congress continues a tense debate over how to regulate the internet, the outcome will have lasting effects on New Mexico’s burgeoning film industry, as well as on the freedoms of the state’s citizens and media outlets.
New Mexico, home to a $200 million film industry that employs roughly 20,000 people, has a large stake in the proposed bills, which would strengthen crackdowns on unauthorized streaming of copyrighted content such as music, movies and sports. New Mexico Democratic US Rep. Ben Ray Luján and Sen. Tom Udall respectively cosponsored the House and Senate versions of the bill in October and November.
Both bills would increase the authority of the US Department of Justice and copyright holders to file court orders against websites suspected of illegally sharing copyrighted files. Under the House’s Stop Online Piracy Act, for example, the DOJ can order payment providers like PayPal to shut down pay accounts on foreign websites suspected of offering things like illicit movie downloads.
To Hollywood, SOPA and its Senate counterpart, the Protect IP Act, present a much-needed opportunity to regulate online piracy, which entertainment executives claim is decimating their profits.
“We’re going to lose the film business if something isn’t done,” Jon Hendry, a business agent at International Alliance of Theatrical and Stage Employees in Santa Fe, tells SFR.
US films lose $25 billion a year in lost sales to illegal online downloading and streaming, according to the US Congressional Anti-Piracy Caucus. In North America, the film industry generated nearly $89 billion worldwide this past fiscal year.
Hendry compares online piracy to walking into the box office with a gun and demanding a ticket to a show. “We call it piracy, but it’s really theft,” he says.
He says the piracy hurts not just the film industry, but also the hotel and service workers who benefit from the filmmakers’ lodging and recreation activities during production shoots.
Luján, who says online piracy “stifles innovation,” adds that the danger of “rogue websites” goes beyond pirating. He’s co-sponsoring SOPA partly because it cracks down on websites that sell “counterfeit and contaminated” medicine to seniors, he writes in an email to SFR. Pharmaceutical companies like Pfizer support the legislation for this reason.
But on the other side, web companies such as Google and YouTube, which rely on user-driven content, are leading the opposition to the bills. They lament that, under the legislation, the burden of proof is left to the websites rather than the content providers.
Critics also say the film and entertainment industries are scapegoating online commerce and ignoring the root of the problem: a rapid change in technology. A 2009 study by the Bi Norwegian Business School, for example, found that online users who downloaded music illegally were 10 times more likely to pay for online music than those who didn’t.
“I don’t think it’s that people don’t want to pay for entertainment,” Sean Closson, a 25-year-old artist who’s challenging Luján in the congressional Democratic primary this year, writes in an email to SFR. “They’re perfectly willing to, but you have to make it easy and affordable.”
Closson is a vocal critic of the anti-piracy legislation, which he dubbed “corporatism at its worst” in a recent post on the left-wing Daily Kos website. A case in point, he says, is Universal Music Group’s successful pressuring of YouTube last month to remove a video of celebrities voicing support for Megaupload, a file-hosting website that would likely suffer if the legislation were to pass.
Closson says examples like these “illustrate perfectly what will happen” if the bills pass: a reduction in online freedom. It’s an issue that also concerns staff at the Media Literacy Project in Albuquerque.
“If corporations feel there’s a website infringing on their content, they can go to the internet provider and have them take it down,” Andrea Quijada, Media Literacy Project’s executive director, tells SFR.
Quijada says the legislation’s vague language comes with a cost. A website with something as simple as
a video of someone singing along with lyrics to a copyrighted song, for example, could be labeled as infringement under SOPA.
“There’d be no due process,” Quijada says. “Not only is it unconstitutional, it’s a violation of free speech rights.”
But to others, the freedom of speech argument simply doesn’t apply.
“There’s no First Amendment right to distribute illegal content,” Mike Nugent, executive director of Los Angeles-based Creative America Campaign, a coalition of entertainment industry studios, networks and labor unions, tells SFR.
He argues that the bills don’t censor foreign file-sharing websites; they just block out the US “intermediaries,” such as PayPal, that support them.
Others maintain that the legislation would be minimally effective in halting piracy. Under SOPA, the federal government could order internet service providers to alter domain name systems (DNS), which translate and filter website addresses so web users can access them. Closson says savvy web users could easily access blocked DNS websites through their internet protocol addresses.
Staffers from Albuquerque’s Sandia National Laboratories came to the same conclusion in an analysis requested by US Rep. Zoe Lofgren, D-Calif., who’s opposed to the bill, in November. In a letter to Lofgren, Leonard Napolitano, Sandia’s director of Computer Sciences and Information Systems in the lab’s California office, writes that blocking DNS filtering could prompt “untrusted foreign servers” to fill in the gap, which could result in added security problems for online users.
Sharing copyrighted material without a company’s blessing has long been a point of contention in the entertainment industry. In the early 1980s, the music industry attempted a crackdown against home audio recording with the infamous and unsuccessful “Home Taping Is Killing Music” campaign.
Similarly, in 1984, the US Supreme Court ruled that taping TV programs on a VCR constituted “fair use.”
But to many, today’s rapidly evolving technology brings piracy to a new level. In the old days, people videotaped films while sitting in theaters and later sold them as low-quality bootlegs, a practice that has always been illegal.
“Now, if you get a hold of a digital copy that is not protected adequately, the product you see on a flat screen TV is superb,” Rick Clemente, CEO of I-25 Studios in Albuquerque, tells SFR. “That makes pirating more dangerous.”
But to Closson and Quijada, the latest anti-piracy campaign is really just an example of an industry unwilling to change an outdated business model. Closson cites the successful experiment of comedian Louis CK, who last month sold tickets to an online stand-up show directly to his fans for $5 each and netted $1 million within 12 days.
“I think [that’s what] these companies are afraid of,” Closson says, “a future where you don’t have all of these middlemen between artists and their audience.”
SOPA, which has broad bipartisan support, remains in committee. The Senate will vote on the Protect IP Act on Jan. 24. Udall, who received more than $200,000 in campaign contributions from legacy media companies last year, didn’t comment before press time.