For nearly two and a half years, I refrained from discussing politics on the blog. If political rants are not your bag, you can close your browser now, and wait until I post something more relevant to the blog's subject matter.
Today, the full Judiciary Committee of the US House of Representatives held a hearing on the “Stop Online Piracy Act” (H.R. 3261) or SOPA for short. You can read the full text of the bill here: “Stop Online Piracy Act” Full Bill. This bill was introduced in October of this year, and if you have not heard about it yet, you will start hearing about it very soon.
Executive Summary: This bill is a testament to the idiocy of our elected Congress.
Is that short enough for you? On the surface, the bill's intended directive is to strengthen copyrights owners rights as related to the protection of their intellectual property, over and above the Digital Millennium Copyright Act which has been the standard for 15 years. The motive behind this is summarized by Judiciary Committee Chairman Lamar Smith commentary on the bill: "Unfortunately, the theft of America’s intellectual property costs the U.S. economy more than $100 billion annually and results in the loss of thousands of American jobs." Much of the Judiciary Committee commentary on the bill speaks to foreign and rogue websites that must be dealt with harshly and punitively.
As always though, the ACTUAL legislation does not match up with the "talking points" espoused by Congress.
In fact, H.R. 3261 completely undermines the safe harbor afforded by the Digital Millennium Copy Right Act which holds that websites will not be liable for their users posting copyrighted materials if they remove said material claiming copyright infringement. Furthermore, and this is a real gem, it FORCES search engines and payment processors (Paypal, Mastercard, etc) to cut all tied with allegedly infringing sites in effect dropping them off the face of the earth. Worse yet, if I, as a content provider, link to an infringing site, I can also be held liable, and my site can be cut off from search engines, advertising networks, etc.
The example I have used to friends in the investment community is that of Scribd. I would wager that 90% of the hedge fund letters or sell side presentations posted on the web are posted via Scribd. I've done it myself, and oftentimes link to hedge fund letters others have put up on Scribd.
Under SOPA, Scribd would no longer be able to exist. And as I've linked to Scribd in the past, I and many other prominent financial bloggers could be held liable and cut off from the DNS directory and search engines.
Google , AOL, eBay, Facebook, LinkedIn, Mozilla, Twitter, Yahoo and Zynga are all vehemently opposed to the legislation. Think about it: If some person uploads to YouTube just one unauthorized piece of copyrighted material, the ENTIRE SITE CAN BE SHUT DOWN. Where are we living? China? Pre-revolution Egypt? This puts an unprecedented level of censorship in the hands of content providers and, if passed, will literally change the way content is consumed on the internet. Definitely for the worse.
For more information, you can read more here: Gizmodo on SOPA as well as the hundreds of articles that will soon be coming out on the issue.