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Summary:

Just like the iPhone brought smartphones to the mainstream, widespread streaming, YouTube and online pharmacies have brought SOPA to Congress. But the fundamental issue isn’t about SOPA, it’s about protecting business models that rely on a fragmented world, as the web makes fragmentation less relevant.

pirate flag

The House today is conducting a hearing in order to mark up the Stop Online Piracy Act — a proposed law that has mobilized Silicon Valley in a way that goes far beyond issues such as privacy or even network neutrality. As technology creeps into the mainstream and habits like broadcasting your location, sharing or watching TV online or even taking videos of your child dancing to Prince become commonplace, the old-media machine has realized it has to act soon to maintain its ever-weakening hold on the days when content was not digital and people weren’t sharing every waking moment of their lives.

Mainstream technology adoption equals mainstream political attention, and entrenched industries seem to have figured out that they have to act before too many citizens (and too many legislators) start using these new devices and come to understand the limitations that laws such as SOPA could impose on them. Essentially SOPA could make it possible for web sites to be shut down for hosting pirated content, and could penalize sites that host such content even unknowingly. Just like the iPhone brought smartphones into the mainstream, widespread streaming, YouTube and foreign online pharmacies have brought SOPA to Congress. But the fundamental issue isn’t really about SOPA — it’s about protecting business models that rely on a fragmented world, as the Internet makes that fragmentation less relevant.

So maybe it’s a grandma in St. Louis buying her prescription drugs from a Canadian pharmacy or a teenager in the Canada using a VPN to access Hulu content that is only broadcast in the U.S. In those cases and others, the realization is slowly dawning that making money based on varied pricing and distribution within certain borders has become impossible. SOPA may be the content industry’s attempt to throw up a terrible option in order to make a compromise solution seem more palatable, but the hard truth is that compromises will have to be made.

Look at the history of TiVo. When the TV industry saw what people’s desire for time and place-shifting of scheduled content was doing to their revenue model (selling ads), they took action to try to prevent the future from moving forward. But after a few years, people’s habits and expectations had changed and the TV industry realized it had to accept that time and place shifting was inevitable, but perhaps it could still make money on ads. Thus, efforts like Hulu and TV Anywhere were created. That industry couldn’t stave off a fundamental change wrought by new technology, but it could co-opt it a bit to save some of its revenue model.

So amid the debate on SOPA today, while the House tries to figure out if it should pass this legislation (and its 71-page amendment that is intended to make it slightly less frightening), we need to remember that this isn’t just a debate over intellectual property protection, but a fight to maintain the business models that used to exist 15 years ago, before the rise of the web helped make the Internet a popular pastime and started the disruption we still see today. Keep that in mind if this goes forward or even if the government tries to push another act aimed at preventing IP theft, the so-called OPEN Act.

Image courtesy of Flickr user HelloTurkeyToe.

  1. try living outside the US, the internet is far from borderless…
    the danger for the US is that it will become irrelevant if it continues to try this walled garden approach thru business influenced politics… eventually the rest of the world will figure out that theres a tonne of money to be made in digital content and that catering to just 5% of the globally population who don’t play fair is silly…

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    1. Paul, you are correct. the Internet still has borders, but the point i was going for is that it helps diminish them and offers ways around them, and those workarounds tend to get easier and more mainstream as time passes. And yes, I agree that there is a real danger of the U.S. cutting off its nose to spite its face here.

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  2. Don’t censor the internet!

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  3. Agree the borders already exist, and SOPA would make it worse. It may not be as serious as say Chinese censorship of human rights, but geoblocking is already extremely prevalent, just to access movie/tv content from America in Europe, for example.

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  4. Richard Bennett Thursday, December 15, 2011

    Yeah, it’s not really about preserving Hollywood’s old-time Internet business model as it is with trimming the excesses on the “UGC” business model. UGC is a thin veneer for blatant piracy. YouTube deals with 5 million take-downs a year, so the underlying model is clearly in a legal grey area at best.

    Hollywood and Nashville have been effectively subsidizing the Internet with free content, and they’re kinda tired of it. I can’t fault them for this.

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    1. I think that if Hollywood and Nashville picked their battles they could argue this from more of the moral high ground. However, they cast a wide net, so they’ve lost a lot of respect from consumers. They also are making buying legal content untenable in many ways and that’s not hel;ping.

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  5. Q3 technologies Friday, December 16, 2011

    This idea isn’t practical any way you look at it. The free man has the Internet, please don’t try and take that away from us SOPA.

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  6. Congress responds to pressure from voters as well as contributors. If everyone who dislikes SOPA writes his representative and senators and promises retribution at the polls AND follows up this thing wouldn’t have a prayer

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