Anti-piracy setback

Bill would free online firms of liability

WASHINGTON — The music and motion picture industries lost an early round Thursday in what is sure to be an epic battle concerning copyright law in the digital age.

Key members of the House introduced a bill that would indemnify telephone companies and online service providers from liability if their networks are used to distribute pirated material.

Copyright owners worry that the bill will leave the online service providers without any responsibility for policing their own networks. It is a critical issue, because in the era of the Internet, a pirate can copy and distribute millions of dollars worth of copyright material with $1,000 worth of computer equipment.

The On-Line Copyright Liability Limitation Act was introduced jointly by House Intellectual Property subcommittee chairman Howard Coble (R-N.C.) and House Judiciary Committee chairman Henry Hyde (R-Ill.)

Overly broad

“This bill is overly broad and turns the concept of copyright law on its head,” said Hilary Rosen, CEO of the Recording Industry Assn. of America. Rosen, like other lobbyists for copyright-rich industries, says that domestic copyright law does not need to be altered to protect the interests of companies that provide access to the Internet. “There is no reason to believe that current copyright law is slowing down the growth of the Internet,” Rosen said.

The bill has the backing of telcos and companies such as America Online, which are worried that they will be held accountable for Internet piracy conducted over their networks. The telcos are a formidable foe in Washington, even for the powerful show business lobbyists. “They are a huge lobby,” Rosen said, adding, “And they make huge political contributions, but on this issue they are just wrong.”

Motion Picture Assn. of America prexy Jack Valenti also was disappointed Thursday by the introduction of the copyright legislation. “It strips copyright owners of the safeguards they must have to protect their property,” he said. “And at the same time, it gives online service providers the keys to the kingdom.”

Although the bill has not yet had its first hearing, Coble issued a statement Thursday saying the proposal will “serve as a new starting point for groups affected by its provisions.”

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