Copyright

After losing a bruising battle earlier this year over anti-piracy legislation, the U.S. Chamber of Commerce is shifting gears and trying to show the importance of intellectual property to every U.S. state and to the safety of products Americans use every day.

In a new study, the chamber's Global Intellectual Property Center breaks down how much intellectual property benefits each state in terms of the jobs, exports and other economic benefits generated directly and indirectly from intellectual property-intensive companies.

The report found IP-intensive companies created more than 55.7 million jobs, both directly and indirectly, from 2008 to 2009. The report found that these companies also generated $5 trillion in national gross domestic product and accounted for more than $1 trillion in exports. For example, California, home to both Silicon Valley and the movie industry, benefits the most from IP industries with more than 7.3 million jobs, according to the study.

The report appears to be part of an effort to refocus the debate over how to address the growth in copyright infringement and counterfeiting online following the collapse earlier this year of legislation aimed at addressing the problem.

The chamber helped lead a broad coalition in support of a Senate bill known as the Protect IP Act and the House's Stop Online Piracy Act, which aimed to curb piracy and counterfeiting on foreign websites. Both bills were derailed in January after unprecedented protests from tech firms, Internet activists and civil libertarians who argued that the legislation would hamper free speech and innovation on the Internet.

While supporters tried to highlight the support the legislation enjoyed from copyright and trademark holders from a wide range of industries, the debate turned into a Hollywood vs. Silicon Valley battle.

Steve Tepp, chief intellectual property counsel for the Global Intellectual Property Center, said the chamber is focused "at this point on showing how IP is a critically important part of our economy."

Sen. Chris Coons, D-Del., a Senate Judiciary Committee member who supported Protect IP, said that he knew that supporters had failed in their messaging when one of his 13-year-old sons woke him one morning during the debate over the anti-piracy bills and asked why Coons wanted to break the Internet. Coons also said that despite his support for the Senate's bill, he believed the House bill did "overreach" and posed a threat to the Internet.

"We didn't really succeed in getting across a message that I think is valuable...which is that intellectual property protection isn't just about music labels and movie studios. It's about more than just students in college dorms downloading pirated copies of the latest song or movie," Coons said at a news conference. "It is about safety for consumers and it's about jobs for American workers and American families and it affects every single state."

Sens. Chuck Grassley, R-Iowa, and Pat Roberts, R-Kan., also spoke at the event and stressed the importance of intellectual property to agriculture, a key industry in both their states.

Some of the same groups that backed controversial legislation to crack down on piracy on foreign websites are urging the Obama administration to support strong intellectual property protections in a trade agreement with a group of Asia-Pacific countries.

The United States and eight other countries are meeting in Dallas over the next 10 days for the 12th round of talks on the Trans Pacific Partnership Agreement and are expected to deal with patents and enforcement of intellectual property.

A coalition of trade groups representing a broad range of U.S. industries wrote President Obama Tuesday to urge that his administration push for the inclusion of strong protections for intellectual property in the agreement.

"While the benefits of strong IP protections and enforcement are widely supported throughout the United States and safeguarded in our Constitution and laws, such protections are at serious risk in the ongoing TPP negotiations," according to the letter signed by industry groups such as the Association of American Publishers, the Motion Picture Association of America, the Recording Industry Association of America and the U.S. Chamber of Commerce. "Some seek to enshrine low standards of protection, with limited enforcement, in the final TPP agreement, arguing that U.S. proposals would be harmful and could undermine other interests."

The letter was signed by many of the same groups that pushed for the anti-piracy bills known as the Stop Online Piracy Act in the House and the Senate's Protect IP Act. Both bills were sidelined in January after facing fierce opposition from tech firms, Internet advocates and others.

In their letter to Obama Tuesday, the industry groups argued that more "rigorous IP rules are needed to thwart the explosion" of copyright and trademark infringement. Supporters of the anti-piracy bills made many of the same arguments in pushing for SOPA and Protect IP, saying they lacked tools to go after the growth in foreign websites offering pirated U.S. content or counterfeit goods.

Several public interest groups, however, have raised concerns that the United States will push for strong IP protections without including some of the exceptions in U.S. law. They also have been critical of the process, which they said is too secretive. They noted that the U.S. trade officials have released little information about the proposed pact.

The negotiations over TPP appear to be focused "on one side of the equation while excusing any provisions that deal with copyright limitations and exceptions," Rashmi Rangnath, director of Public Knowledge's Global Knowledge Initiative, said in a conference call last week with reporters.

An official with the U.S. Trade Representative's office tried to address such concerns during remarks at the Computer and Communications Industry Association annual conference late last month.

Deputy U.S. Trade Representative Demetrios Marantis said the United States was working to "strike the right balance with respect to copyright protection with having a high standard for copyright protection while at the same time recognizing that there are legitimate exceptions to that, such as fair use."

Las Vegas -- Internet companies fighting piracy legislation took a few lessons from broadcasters about how to use their own media, the head of the National Association of Broadcasters said on Monday.

Just as broadcasters used their airwaves in recent years to fight legislation that would have required radio stations to pay performers for playing their music on air and to get changes NAB wanted to spectrum legislation, Internet firms used their websites to oppose the House Stop Online Piracy Act (SOPA) and the Senate's Protect IP Act, NAB President and CEO Gordon Smith said at the group's annual meeting.

Tech firms engaged the support of Internet users, who in turn called lawmakers and urged them to oppose the anti-piracy legislation. That effort came to a head in January when Google, Wikipedia and thousands of other websites blacked out all or part of their websites in protest of SOPA and Protect IP. Congressional leaders shelved the two bills within days of the online protests despite a strong push from powerful content industry lobbying groups including those that represent movie makers and record companies.

"The technology community - the Googles and Wikis - used their medium just as we did to create a powerful megaphone to change forever how battles are won, or lost inside the Beltway," Smith said. "Like us, they used every tool at their disposal to sway the debate."

As sales of traditional CDs fall and the music industry continues to battle online piracy, music industry groups and providers of new digital music services said Wednesday that they have reached a "historic" deal setting rates for digital music that can be provided online in new and creative ways.

The agreement among the Recording Industry Association of America, National Music Publishers' Association and Digital Media Association will set rates for the prices that must be paid to music publishers to provide their music through emerging services such as iTunes Match cloud service. The agreement must still be approved by the Library of Congress' Copyright Royalty Board, which sets statutory license fees for online music.

The new agreement covers five new business models: paid locker services that provide subscription-based on demand streaming or downloads such as iTunes Match cloud music service; locker services that give consumers free access to a cloud service if they purchase a CD, download or some other type of music; "limited offerings" that might offer consumers specific playlists or types of music; music bundles that might include a CD with a download; and mixed service bundles such as a broadband provider that also offers some sort of music service.

"Music publishers and record companies alike are starting to see that the business of selling music is absolutely reliant on the online area," Digital Media Association Executive Director Lee Knife said in an interview.

The rates that online music service providers would pay under the deal, which would run for five years starting in 2013, would vary depending on the service that is offered, industry representatives said. The groups also announced that they would be extending until 2017 an existing agreement set to expire at the end of the year covering the prices for CDs and digital downloads offered by digital music stores and other services like iTunes.

The deal is aimed at avoiding some of the past battles over rates for music streaming services while also introducing new ways for consumers to enjoy music and possibly deter online music piracy.

"This is a historic agreement that reflects our mission to make it easier for digital music services to launch cutting-edge business models and streamline the licensing process," Recording Industry Association of America Chairman and CEO Cary Sherman said in a statement.

Federal efforts to crack down on intellectual property infringement increased across the board last year, according to a new report by the White House.

"Protecting what we invent, create and produce is always important, but at this time, when every job matters, it is especially important that we stop theft that harms our businesses and threatens jobs here at home," U.S. Intellectual Property Enforcement Coordinator Victoria Espinel wrote in her second annual report to Congress.

In January widespread protests led Congress to scuttle proposals to give officials more authority to go after counterfeit and pirated goods and content on foreign websites.

The report says investigations by Immigrations and Customs Enforcement increased 17 percent in 2011, while arrests in those cases were up by 57 percent and convictions increased by 71 percent.

Homeland Security agencies seized 44 percent more fake safety and technology goods. Seizures of counterfeit pharmaceuticals were up by almost 200 percent.

The group that manages the Internet's domain name system may have awakened a sleeping giant with its controversial program to allow for the launch of an unlimited number of top-level generic domain names.

While critics of this program may have failed in stopping or delaying the launch of the new domain name program, it is clear that they will be closely monitoring how the Internet Corporation for Assigned Names and Numbers implements the program and how it carries out its business generally. ICANN began accepting applications for its new domain name program in January and will reveal the list of applicants in May.

"ICANN is not the same organization that it was a year ago before we started our efforts. It's very much attuned to the notion that the entire world is watching them now," Judy Harris, a partner with the Reed Smith law firm, said Wednesday at the Association of National Advertisers annual public policy conference.

Harris is working with the ANA to try to address the group's concerns with ICANN's new domain name program. The ANA, which launched a coalition last year to oppose the program, made clear at Wednesday's conference that it will continue to press for changes to the program to ensure its members, which include major U.S. companies ranging from Bank of America to Cisco to Procter & Gamble, are not adversely affected.

ANA and other critics worry that introducing hundreds or even thousands of new domain names will force trademark and brand owners to spend millions to police their trademarks or to launch their own domain names.

"Our concern is we're going to see a lot more cyber squatting, phishing, fraud and consumer confusion that will make the Internet an unstable place to do business," Sarah Deustch, vice president and associate general counsel for Verizon, which also is an ANA member, said during a panel discussion at ANA's conference.

Procter & Gamble Associate General Counsel and Vice President Paul Franz., whose company owns thousands of trademarks, said the launch of so many new top level domain names will impose huge costs on his firm while providing "no demonstrable benefit."

Harris and others noted that while opponents haven't kept the program from moving forward, they have brought more attention to how ICANN operates and potential conflicts of interests among its board members. That issue erupted at ICANN's public meeting earlier this month in Costa Rica when outgoing ICANN CEO Rod Beckstrom called on his board to tighten its own conflict of interest rules.

Several board members have been linked to some of the companies that would benefit from the new domain name program, including Board Chairman Steve Crocker. He has revealed that his own start-up company has received funding from Afilias, which offers domain name registry services and operates the .info top-level domain name.

"I believe it is time to further tighten up the rules that have allowed perceived conflicts to exist within our board. This is necessary not just to be responsive to the growing chorus of criticism about ICANN's ethics environment, but to ensure that absolute dedication to the public good supersedes all other priorities," Beckstrom said during a speech at ICANN's meeting. "ICANN must place commercial and financial interests in their appropriate context. How can it do this if all top leadership is from the very domain name industry it is supposed to coordinate independently?"

Former ICANN Chairwoman Esther Dyson, who served on the ICANN board when it was founded in 1998, said at the ANA event Wednesday that registries, the companies that operate top-level domains, and registrars, which sell domain name registrations to the public, play too big of a role in helping to develop ICANN's policies and are the ones who stand to make the most money from the new domain name program.

The Commerce Department's National Telecommunications and Information Administration cited the need for stronger conflict of interest rules in its proposal to extend a technical contract ICANN currently has with the agency. NTIA earlier this month cancelled its request for proposal on this contract after saying none of the groups that bid had met its requirements and extended ICANN's current contract for six months.

Supporters of increased anti-piracy efforts, including the proposed Stop Online Piracy Act, are the "greatest threat" to Internet freedom in the United States, a former Federal Trade Commission official said on Tuesday.

Two years after Secretary of State Hillary Clinton laid out U.S. support for global Internet freedom, efforts to crack down on online theft, increase surveillance, or block protests have proved those words to be empty promises, said Christopher Soghoian, a research fellow at George Soros' Open Society Foundations and a former technologist at the FTC's Division of Privacy and Identity Protection.

"It's really time to stop quoting Hillary Clinton's speech on Internet freedom," he said at a Media Access Project forum on Internet freedom. "The last two years have shown those were hollow, shallow words."

While the copyright lobby is pushing for stricter Internet piracy laws, thousands of Internet companies have mobilized to protest proposed anti-piracy bills, which were eventually abandoned.

Soghoian called such proposals "truly heinous" and said they undermine the free flow of information online. "There are many bad things on the horizon and Hollywood is pushing them," he said. "In an attempt to protect their own failing and sinking business model, they are willing to take the Internet down with them."

Supporters of the House's Stop Online Piracy Act and the Senate's Protect IP Act said online theft of intellectual property is out of control and is hurting the economy as a whole. Fears of censorship and control are overblown by Internet companies that profit off the flow of illegal content, supporters like the Motion Picture Association of America have said.

But not all threats to global Internet freedom are homegrown.

While the gap between countries with relatively free Internet access and those that censor and control the Web has increased in recent years, Google's Bob Boorstin said he will be watching countries that haven't fully gone one way or another. "Are they going to go the right way? Or the wrong way and try to clamp down on information," he said.

Too many tax-payer funded technologies are being taken by China or other countries, Sen. Jim Webb, D-Va., says, and on Friday he reintroduced a bill to stop the flow.

In order to operate in China, for example, American companies are often forced to hand over their intellectual property and proprietary. Many of those technologies are developed using taxpayer money through grant, loans, or other incentives, Webb said in a statement.

"If taxpayers supported the development of the technology, they own a piece of it and it can't just be given away," Webb said. "Federal dollars that go toward R&D funding, loan guarantees, and public-private partnerships in order to help develop the next generation of technologies here are supposed to be making American businesses competitive and generate American jobs -- not to help develop other industries, such as those in China."

Webb's bill would prohibit companies from transferring technology to countries that require such transfers as a cost of doing business.

"The transfer of publicly supported proprietary technologies by American firms to China -- and potentially other countries -- clearly and unequivocally places the competitive advantage of the American economy at risk," Webb said.

Facing an online protest that appears to have gone viral, supporters of legislation that would crack down on piracy and counterfeiting on foreign websites are trying to fight back by launching a new advertising campaign.

Creative America, a coalition of movie studios, television networks and entertainment industry unions, launched a new campaign Wednesday in support of the Senate's Protect IP Act and the Stop Online Piracy Act, or SOPA, in the House. The move came on the same day that thousands of websites went dark to protest both bills, which critics say will stifle innovation and free speech on the Internet.

Creative America has launched banner ads on some websites and a huge billboard in New York's Time Square advising Internet users to read a book, listen to music or go to a movie during the 24-hour blackout of sites like Wikipedia, Craigslist and Reddit. The coalition also is launching television, radio and print ads in select markets in support of the two anti-piracy bills.

"With the opponents of the bill trafficking in misinformation, fear tactics and public relations stunts like blacking out their websites--in essence censoring the Internet themselves--we thought it more important than ever to get the message out that these bills are reasoned, narrow, effective and necessary measures to combat foreign rogue sites, which are preying on American consumers and costing American jobs," Creative America Executive Director Mike Nugent said in a statement.

The campaign comes at a critical time as opponents appear to be making headway in Congress. The Senate is set to vote Tuesday on whether to allow debate to begin on Protect IP, while the House Judiciary Committee said this week it will resume its markup of SOPA next month.

Rep. Zoe Lofgren, D-Calif., who has helped lead opposition to SOPA in the Judiciary Committee along with Reps Darrell Issa, R-Calif., Jared Polis, D-Colo., and others, told Tech Daily Dose Wednesday that she will continue to try make improvements to the bill when work resumes and has 50 amendments ready to go.

While House Judiciary Chairman Lamar Smith, R-Texas, has pledged to remove a controversial website blocking provision from the bill, Polis said Wednesday that it's unclear what other changes could be made. He urged critics to keep the pressure on lawmakers in both the House and Senate to oppose the legislation.

"We will have to react to how these bills will be changed. In the House, we don't know what the chairman has in store for the markup or in the Senate how [that] bill will be brought to the floor or what the manager's amendment will contain," Polis said in remarks at the annual State of the Net conference. "Public interest has to be ongoing. Not just a flash in the night."

Smith told Tech Daily Dose Wednesday that he does not know if he will make additional changes to the bill before next month's markup.

With the House Judiciary debate over online piracy legislation now expected to extend into the new year, the Office of the U.S. Trade Representative provided copyright and trademark holders with fresh evidence Tuesday to demonstrate the scope of online infringement they face from pirates and counterfeiters based offshore.

USTR released a new report outlining the most notorious infringers based outside the United States.
"Globally copyright piracy on a commercial scale and trademark counterfeiting continue to thrive, in part because of the presence of marketplaces that deal in goods and services that infringe intellectual property rights," according to the USTR report.

The report includes a list of sites offering pirated music, links to pirated content, sites that provide illegal streaming of live events such as professional sports, cyber lockers where pirated content can be stored and accessed, and social networking sites such as Russia's vKontakte, where users can provide access to infringing materials.

"The notorious overseas markets highlighted in today's report are a direct threat to the millions of hard-working Americans and the tens of thousands of businesses that rely on [intellectual property] for their livelihoods," Michael O'Leary, senior executive vice president of the Motion Picture Association of America, said in a statement. "The list also demonstrates the need for Congress to take action against rogue websites that are causing so much damage to American workers and businesses."