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Those who dismiss concerns about copyright piracy always deflect the conversation to the big Hollywood studios, as if piracy only affects extremely wealthy people driving around in Bentleys. It's not surprising that defenders of piracy tend to be class warriors in other areas of politics as well.

But the greatest impact of piracy is on those downstream small businesses and employees who work in the industry. Losses due to piracy, at the margin, affect the number of people hired, how much they are paid, and how many projects are undertaken in the first place.

But then there's the indie filmmaker, for whom the entire project is being done on a shoestring. When everything is being done with marginal resources, marginal impacts have a major impact. The same protections that would protect the major Hollywood studios against rampant piracy would be even more beneficial to the little guys.

There's a very interesting article up on FilmSchoolRejects.com about filmmaker Zak Forsman and the experience he's having with piracy of his new indie film, Down and Dangerous.

A particularly shocking report comes today from the UK, in which counterfeit wine and liquor are flooding the market, containing dangerous chemicals such as methanol, chloroform, bleach, nail polish remover and anti-freeze. According to the report, up to 2 dozen bottles of vodka were being produced every minute at one counterfeiting site. 

And it’s not just occurring in the UK.  

In the United States, federal agencies have stepped up to identify, intercept, and prosecute criminal activity attempting to import or manufacture fakes in the U.S. to protect innovators and consumers from the dangerous impact of counterfeits. 

This week, Sen. Ron Wyden (D-Ore.) told the Washington Post the Supreme Court decision on Aereo will discourage innovation.

But in a recent podcast, IPI president Tom Giovanetti debunks what he calls negative spin regarding the ruling, and says it’s a win for all players in the market because it’s a win for the rule of law. (Click here to listen to the IPI podcast.)

Reports indicate President Obama is poised to tap Phil Johnson as the next Director of the United States Patent and Trademark Office.

Currently Senior Vice-President for Intellectual Property Policy & Strategy at Johnson & Johnson, Phil Johnson joined IPI in 2011 at our annual World Intellectual Property Day Forum and spoke on a panel called “Hot Topics in IP.” Click here to watch video of that panel.

In an op/ed published Wednesday in the Dallas Morning News I argue that Republicans should let the Export-Import Bank expire instead of reauthorizing it.

In the piece, I mention a charge that the Export-Import Bank may have loaned money to Mexican drug cartels.

Of course, you can't put hyperlinks or footnotes in op/eds. So here's the source of that little factoid from 2007, compliments of the Wayback Machine.

DALLAS - A News 8 investigation has found that a little known government agency may have unwittingly wasted taxpayers money on top of using the funds to support criminal activity.

The probe originally revealed that small business loans sponsored by the Export-Import Bank of the United States were made to non-existing companies for equipment that wasn't even real.

Now, New 8 has discovered that some of the people who got the Ex-Im Bank loans may have drug connections. The $243 million worth of bad loans were originally made to help trade with Mexico.

The loans have been linked to the Juarez drug cartel, which is known for its brutal murders. The cartel killed one dozen people and buried them in a suburban backyard across the border fro El Paso.

Another loan was linked to the Sinaloa drug cartel, whose business is smuggling heroin into the United States.

The federally funded Ex-Im Bank apparently backed loans to people affiliated with both cartels and the Mexican drug trade.

Under the Freedom of Information Act, News 8 asked for all documentation related to defaulted small business loans made to Mexico from 2002 to 2005. Although there were nearly 200 bad loans, so far, information on only 34 cases has been turned over.

But the bank did give a list of the defaulted loans and the names and addresses of the people who got them in Mexico.

"They have drug connections, which is very disheartening to think that the U.S. government is lending money to documented traffickers in the drug trade that are tied into the cartels in Mexico," said Phil Jordan, the former head of the El Paso Intelligence Center for the DEA and Border Patrol in El Paso.

Jordan ran background checks of the borrowers with two federal sources and found borrowers from Juarez and Sinaloa with criminal ties to money laundering, organized crime or drugs in Mexico. Jordan said he was surprised to find that the Ex-Im Bank didn't do similar checks before guaranteeing the loans.

Be judicious when you buy. That "steal of a deal" may cost you a lot more than you think.

For some time IPI has been at the forefront of arguing in favor of intellectual property protection, since we believe that property rights are the basis of any market-based system, and markets are the best way to allocate goods and services. And particularly in an innovation-based economy, ensuring that innovators and creators are able to reap the rewards of their successful products is the best way to continue to fund a virtuous cycle of innovation.

Most commonly IP is protected through the force of law, since it is a proper role of government to facilitate the protection of private property. But, practically as well as legally, everyone who wants their world to be a world rich in creativity and innovation has an interest in seeing that creators and innovators are rewarded, in order to encourage continued creativity and innovation as envisioned by the American Founders in the Constitution’s Copyright Clause.

Massive on-line piracy, of course, derails the virtuous circle by depriving creators of any hope of reward. But the development of new business models through which content can be legally obtained on-line means that today those who might have taken the easy piracy route can be educated and redirected toward an abundance of legal options.

This is what brought Internet providers to the table with content companies some time ago to devise a voluntary system to try to reduce online piracy. Whereas before ISPs had been sometimes accused of having interests opposed to those of the content companies, in the maturing Internet ecosystem it has become clear that all legitimate players in the Internet have an interest in making sure that the Internet is a place rich in creative content, and a place where those who contribute to this richness at least have the option of attempting to monetize their content through various business models.

Rep. Sean Duffy (R-WI) will offer an amendment tomorrow to the Commerce, Justice and Science (CJS) appropriations bill that would prohibit any funds from being used to relinquish control of the remaining root functions of the Internet to a multistakeholder organization, as is currently planned.

IPI has previously expressed our deep concerns that, while it is true that transferring those functions to the multistakeholder organization imagined by the administration would not mean those functions were subject to political control or United Nations control, it is probably inevitable that such an organization would eventually succumb to pressure. I've mentioned examples such as the World Intellectual Property Organization (WIPO), the World Meterological Organization (WMO) and the International Telecommunications Union (ITU) as similar multistakeholder organizations designed to support a purely technical mission but that became UN organizations and thus subject to the domination of the UN bureaucracy, UN organizational rules, etc.

There is no compelling reason why any of those organizations needed to be within the UN system, but they ended up there. They had specialized, technical functions but now are subject to political mischief because they are part of the UN system. There's every reason to think the same thing will eventually happen to the Internet functions if the U.S. surrenders them, especially since the UN already claims the right to be involved in Internet issues through both the ITU and the Internet Governance Forum (IGF).

IPI was on a panel a few weeks ago discussing this topic, and the CSPAN video is archived here. And if you don't want to watch the video, I blogged on my participation at that event here.

So, while what is currently planned and underway is not transferring control of the Internet to the UN, there is every reason to believe that will be the eventual result. And there is every reason to be very, very concerned about that result.

Congress is right to assert itself in this regard, and to prevent the administration from acting unilaterally to take what is almost certainly a bad step for the Internet.

There has been a lot of rhetoric around the phrase "permissionless innovation" in the last couple of years. I'm not myself comfortable with the phrase, because I think a hallmark of civilization is respect for the property of others, and thus the West has developed an entire permission-based legal culture around property rights.

But others ARE enamored of the idea of permissionless innovation, especially the Internet and tech community.

That's why I am struck in reading through FCC Chairman Wheeler's new 100 page net neutrality NPRM document. Apparently, one of the many things net neutrality means is permissionless innovation for edge companies but NOT for network providers.

Because network providers are going to need permission for a whole lot of things they do. Any new thing they want to try with regard to their business model is going to be subject to some absurd and undefined "commercially reasonable" standard.

How do we determine whether a practice is "commercially reasonable?" Apparently permission will be required of the FCC.

So I will take great joy in the next few months in pointing out they hypocrisy of net neutrality proponents who think permissionless innovation is a virtue—just apparently not for broadband companies.

'Cause it's not as if we want rapid innovation in broadband networks. No, of course not. That would be silly.

Commissioner Pai strikes at the heart of the problem with assuming that the D.C. Circuit court gave the FCC broad authority to impose regulations on broadband. Some highlights:

". . . every American who cares about the future of the Internet should be wary about five unelected officials deciding its fate."

. . .

". . . President Clinton and Congress got it right in the Telecommunications Act of 1996 when they declared the policy of the United States to be 'preserv[ing] the vibrant and competitive free market that presently exists for the Internet . . . unfettered by Federal or State regulation.'"

. . .

"If we are to take the D.C. Circuit at its word, section 706 grants the FCC virtually unfettered authority to encourage broadband adoption and deployment. So if three members of the FCC think that more Americans would go online if they knew their information would be secure, could we impose cybersecurity and encryption standards on website operators? If three members of the FCC think that more Americans would purchase broadband if edge providers were prohibited from targeted advertising, could we impose Do Not Track regulations? Or if three members of the FCC think that more Americans would use the Internet if there were greater privacy protections, could we follow the European Union and impose right-to-be-forgotten mandates? And because section 706 gives state commissions authority equal to the FCC,11 every broadband provider, every online innovator, every Internet-enabled entrepreneur may now have to comply with differing regulations in each of the 50 states. Tesla, Uber, Airbnb, and countless others can attest to the welcome that parochial regulators give to disruptive start-ups."

This past week I filmed an episode of the McCuistion program, a public affairs TV show that airs around the country, and the topic was net neutrality. It should air in a couple of months.

The program began with Tim Wu's definition of net neutrality, which is essentially the principle of non-discrimination: All bits have to be treated the same, with no discrimination. Essentially, the "dumb pipes" argument all over again.

This emphasis on non-discrimination reminded me of the first op/ed I wrote against net neutrality way back in 2006, in the early days of the net neutrality debate, entitled "Welcome to the Stupid Internet."

The piece is no longer archived on the San Jose Mercury News site, so we keep it archived here.

It's interesting to me that we are still at non-discrimination after all these years.

Of course, David Isenberg didn't like it. But Richard Bennett did, as did Scott Cleland. 

Here's what I think is interesting: For those eight years, we did not have net neutrality regulations, and the Internet blossomed. So . . . doesn't that mean that net neutrality proponents were wrong, and that the Internet was just fine without net neutrality regulations?

Oldie but goodie.

Great piece in today's Wall Street Journal on ad-supported piracy.

Many people still think of piracy as a victimless crime; or rather, of a crime that affects a victim that they don't care about: Big Content, or whatever disparaging name they prefer to use. They like to convey the idea that piracy is simply people "sharing" content that they "care about."

But piracy is big business, and people are profiting from piracy. Valuable content is valuable, and people are going to make money off of valuable content. The only question is whether the profit-makers are those who invested in the creation of the content, or whether it's just parasites who are making the money.

Piracy websites are the criminals, but companies and networks that advertise on those piracy websites are the enablers. And it's appropriate to put pressure on companies and ad networks to ensure that their ads don't run on websites trafficking in illegal content.

In February, nonprofit Internet safety group Digital Citizens Alliance commissioned MediaLink to research how much money these sites are making. MediaLink examined 596 sites where viewers can find pirated movies and TV shows, and estimated those sites generate a total of $227 million in advertising revenue annually. Even "small" piracy sites could make more than $100,000 a year from ad space sold to major brands, the report said, because they don't pay for their content. The profit margins of the sites examined could range from 80% to 94%, based on the costs typically associated with maintaining such sites, which include hosting fees and human resources.

Take zzstream.li, for example, which helps users unearth and stream unlicensed video owned by companies including Home Box Office Inc., Warner Bros. Entertainment Inc. and Lions Gate Entertainment Corp. In March, it featured advertising for brands including Kraft, Toyota, Target, Honda, Lego and Claritin. The site reached 1.34 millioni people in March, according to online measurement firm com Score.

I was honored to speak at a panel discussion on Friday sponsored by the Congressional Internet Caucus Advisory Committee on whether transferring control of the Internet root zone functions from the U.S. Dept. of Commerce to some yet-to-be-determined multistakeholder organization is a good thing.

The briefing was televised on CSPAN, and the archive video can be seen here.