RealTime IT News

Music, Software Heads Stump for Tougher IP Laws

WASHINGTON -- For representatives of industries like software and music looking for tougher copyright-protection laws, it's good to have friends in high places.

Commerce Secretary Gary Locke joined the heads of several industry associations this afternoon to unveil a new report highlighting the economic contribution of the copyright industries.

The report, commissioned by the International Intellectual Property Alliance, a consortium of seven trade associations such as the Business Software Alliance (BSA) and the Recording Industry Association of America (RIAA), found that from 2003 through 2007, core copyright industries accounted for about 6.4 percent of U.S. GDP.

In 2007, the most recent year data is available, core copyright industries were a $13.8 billion business, providing jobs that paid better on average than other sectors and growing at a faster rate than overall GSP, the report found. It also warned of the continued threat from both physical and digital piracy, at home and abroad.

Locke said that President Obama is committed to a "robust, progressive trade agenda" that would incorporate meaningful piracy protections, adding that the United States has dispatched intellectual property attachés to piracy hotspots such as China, Russia and Brazil.

The Commerce Department has set up the Web site StopFakes.gov as a resource for information about combating theft of intellectual property, a blight that cost the software industry alone $53 billion last year, according to a study by BSA.

"This theft has the even more insidious effect of dulling the incentives that American companies have to innovate," Locke said.

The heads of the industry associations had kind words for some of the recent steps the government has taken to shore up copyright protections, such as the enactment of the PRO-IP Act last October, but said that more needs to be done.

The PRO-IP Act, among other things, set for tougher penalties for infringers and authorized the creation of a White House position of IP coordinator. Obama has yet to fill the position, and, like many new White House roles, it remains unclear how it will be structured. Dan Glickman, the chairman and CEO of the Motion Picture Association of America, said he hoped the new position would have the "stature and status within the office of the president to do us some good."

The speakers also noted that the increasing uptake of high-speed Internet access has spurred online copyright infringement.

"Music was the first hit and hit hardest," said David Israelite, president and CEO of the National Music Publishers Association. "Now the bandwidth is improving and more people are getting access to broadband, we're seeing that spread to other industries as well."

[cob:Special_Report]Added Glickman, "There's no question online piracy is having a very significant impact." He said his organization was working with officials in the Commerce Department and Congress to "make sure we have the ability to deal with unlawful content on the Internet."

The inclusion of tougher copyright enforcement provisions in trade talks would be welcome news to a group like BSA. Robert Holleyman, the organization's president and CEO, said that Russia, China, India and Brazil together are on track to account for 25 percent of the global PC sales, but just 5 percent of packaged software sales, by 2011.

"Increasingly the foreign sales opportunities for the core U.S. copyright industries ... are where there is so much promise," Holleyman said. At the same time, in the fast-growing market of China, BSA pegged the software piracy rate at 80 percent in 2008.

The United States remains the dominant software provider, with U.S. companies accounting for about 60 percent of global software sales.

Holleyman said that the lion's share of domestic software piracy stems from the practice of "under-licensing," where "otherwise legal businesses" internally copy software instead of paying for separate licenses for each employee's PC. A business that owns 100 PCs might only have sprung for 50 software licenses, for instance.

"Not only is that illegal but we would argue that it's simply unfair," Holleyman said.

Update corrects earlier version to clarify U.S. companies' 60 percent share of the global software market.