New government's legislation could affect U.S., U.K. efforts

PARIS – France’s three-year-old anti-piracy law, whose key provisions include the punishment of multiple offenders, seems to have been beneficial for the industry. However, the new government is mulling changes to the law — changes that are being carefully studied by industry reps in the U.S. and U.K., who have been working to introduce similar regs in their countries.

Passed in 2009, Gaul’s Hadopi antipiracy law (named after the government agency that helps enforce it), is former president Nicolas Sarkozy’s baby. He fought for 14 months to get it passed, even surviving a ruling by France’s constitutional courts that an early Hadopi version contravened the 1789 declaration of the rights of man.

The law says that anyone found guilty of three infringements will be punished, which consists of loss of Internet access for up to one year.

Francois Hollande, who ousted Sarkozy in the May 6 elections, said during the campaign that he intended to abolish Hadopi’s “graduated response” clampdown on consumer pirates. He vowed instead to fight “commercial piracy” — illegal websites — and support funding to help online platforms become competitive.

The next step is industry consultation.

On July 20, former Canal Plus head Pierre Lescure received formal instructions from France’s new government to head a months-long revision of France’s anti-piracy regime.

If the punitive aspect of the Hadopi law is overturned or modified, that may influence other countries, notably the U.S. and U.K., that are battling to introduce comparable laws.

The U.S.’ new “six strikes” law, for instance, serves violators six notices before threatening to slow, not cut, Internet service, but it has no government agency behind it. Major U.S. Internet providers — AT&T, Verizon and Comcast, which is also a content provider — have signed up voluntarily to the scheme.

Oliver Dock, VP at the Motion Picture Assn., says abandonment of Hadopi’s graduated-response strategy would represent a retreat in battling piracy.

Lescure will begin consultation at the latest in September, and draw up proposals for reform by March 2013. He maintains that France’s digital regime must be updated for a new age. “That means consultation with the European Commission, some European countries, and we hope for a lot of collaboration with the U.S.,” he says.

The challenge, he says, isn’t just piracy, but the nature of the Internet and digital platforms themselves. He says France is “way behind” in attracting consumers to legal sites, and says it must improve the quality and quantity of those sites.

Punishing consumers, he adds, misses the point, and is “menacing”: “You can hit illegal sites when you want, but Internet access denial will set the international Internet community against you. It’s like cutting off the water or gas.”

From October 2010 to December 2011, Hadopi served 755,015 notices to consumers who used the Internet to infringe copyrights. More than 90% of those warned did not register further illegal behavior in the next six months, according to a Hadopi source.

Hadopi has yet to cut off anybody’s Internet access, though it is studying 340 cases that it feels merit prosecution.

According to a Hadopi source, the main problem is the difficulty in distinguishing legal and intentionally illegal usage regarding online downloads and streaming. Hadopi is working on establishing better data.

A growing body of evidence suggests that Hadopi’s wide-ranging regs — though not necessarily its three-strikes format — did stem or slow piracy in France.

Consumer awareness of Hadopi, starting in spring 2009, caused iTunes music sales to increase approximately 25% in France, better than upticks in Belgium, Germany, Spain, Italy and the U.K. according to a U.S. study led by Bett Danaher at Wellesley College’s Dept. of Economics, published in March.

But Hadopi isn’t just about monitoring Internet usage. It also relaxed France’s theatrical-to-homevid release window to four months and, according to Alice Enders of Enders Analysis, has effectively taught consumers about the impact of piracy on the local movie and music industries.

Still much of the law’s effect is difficult to quantify. While DVD retail unit sales rose 4.9% to 89.3 million in 2009 after three years of decline, retail price drops were in part responsible for the rally, according to Screen Digest’s Tony Gunnarsson. But French physical video unit sales dropped 2.8% in 2010; one reason for the renewed decline will be piracy, another, still high pricing for DVDs in France, notes Gunnarsson.

And while Internet transaction VOD, such as iTunes, doubled in France in 2010 and increased 80% further in 2011, according to Screen Digest’s Kamila Nigmatulina, that hike also is attributable to content drivers like the Sony PlayStation and iTunes movie service, which launched in France in late 2009, and mid-2010, respectively.

One thing is certain. Lescure’s job is no cakewalk. Most of France’s entertainment industry is reserving judgment on the Hadopi review until the government’s intentions are fully known. But, when questioned, senior players are often vocal.

Rather than targeting consumers, some advocate punishing websites that allow pirated content, and would shut them down after repeated warnings. Others see the devil in the details.

“Those who claim the graduated response violates liberties only think about votes: After all, Internet users represent a large number of electors,” says Pascal Rogard, managing director at France’s Society of Dramatic Authors and Composers. “It’s easy to condemn the Mafia, it’s another thing to go after individuals.” What: France’s anti-piracy law punishes individuals who are repeat offenders.

The takeaway: The U.S. and U.K., considering similar laws, are watching as the new Gallic regime vows to change the punitive aspects of the reg.

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