Hoodwinked by Hollywood, Tech Lobby Study Suggests

CCIA's Black says report can fill in the gaps in copyright debate

The two controversial piracy bills in Congress may be temporarily on hold, but that doesn't mean the fight is over. Far from it. The Internet and tech lobby is determined to keep up the pressure, especially on the entertainment industry, which it accuses of perpetrating lies in order to speed through harmful legislation.

A study released Monday by the Computer & Communications Industry Association, whose members include big tech firms such as Google, Facebook and Yahoo, hopes to paint a different picture of the entertainment industry as a bunch of money-grubbing companies posting tremendous growth that have little reason to whine to lawmakers about grave losses from copyright infringement.

Among the stats: Consumer spending on entertainment is up 15 percent from 2000 to 2008, employment in the sector grew 20 percent in the last decade, and the global value of the entertainment industry grew from $449 billion to $745 billion between 1998-2010, per data from PricewaterhouseCoopers.

"In every meeting, [the entertainment lobby] said they were hemorrhaging money and that it was the end of the world. When you create that kind of fear and sense of urgency, it makes it tempting for [lawmakers] to rush something through," said Ed Black, president and CEO of the CCIA.

Black said the data released Monday will serve to fill in the gaps from the lack of hearings held on the Hill over the two bills, the Stop Online Piracy Act (SOPA) in the House and the Protect Intellectual Property Act (PIPA) in the Senate. "There was not a single hearing in the Senate this year and only one hearing in the House called hastily before the bill was introduced," Black said. "[The entertainment lobby] created the impression there was something cataclysmic happening and that didn't make for a healthy process. We're not against copyright; we're not anti-entertainment and anti-Hollywood except when they lie and mislead."

The study was compiled by Mike Masnick, one of the lead instigators in the Internet’s fight against the bills and the editor of Techdirt, which has kept up a relentless stream of stories from the tech industry’s point of view.

"We didn't produce our own numbers from scratch, such as those the entertainment industry sometimes does," said Masnick. "We should be making laws on actual facts, not on claims that aren't backed up by the facts. Our main purpose was to hopefully inject some credible data into the debate."

Update: Both the Motion Picture Association of America and the Recording Industry Association of America took aim at the study in prepared statements.

The RIAA argued that the study's global picture wasn't accurate of what has been happening in the U.S. "Trends in the U.S. have been clear, with a market less than half as large as it was 10 years ago and 60 percent fewer employees in the music business," said Joshua Friedlander, RIAA's vp of strategic data analysis. "Virtually every neutral academic study has concluded that there is real harm to the music community when people download music illegally."

The MPAA found the Internet lobby's study hypocritical. "Strong intellectual property laws have resulted in an explosion of innovation and economic growth on the Internet. Yet critics of copyright laws are trying to argue that the entertainment indusry should not enjoy the same intellectual property protections as other industries," said Michael O'Leary, the MPAA's senior evp for global policy and external affairs. "What other industry is asked to accept theft of their products as part of their business model?"