In his recent op-ed in The Hill, Mike Montgomery argues that “[m]aking streaming copyright infringement a felony is a terrible idea” that will create “further rifts between tech and entertainment at a time when these two sectors are not only reliant upon one another, but melding.” While it’s true that the line between art and technology has become less discernable, it’s simply false that creating felony penalties for criminal streamers will put a wedge between the two. Instead, protecting artists and authors from such criminal enterprises serves to level the playing field so that honest creators and innovators can work together even more closely.
As we discuss in our recent policy brief, the current law creates a loophole that favors some criminal copyright infringers over others. Large-scale, for-profit criminals who brazenly violate the property rights of creators can face either felony or misdemeanor charges if they offer illicit downloads, but they face only misdemeanor charges if they offer illicit streams. There’s no reason why the two shouldn’t be treated the same. From the perspective of the victims, downloads and streams both supply the public with stolen copies of their works. The only difference is that streams can be enjoyed while they’re being transmitted, while downloads must be fully transmitted before they can be enjoyed. Why should this affect the penalties for theft?
Government officials have been asking Congress to fix this loophole for years. In 2011, former U.S. Intellectual Property Enforcement Coordinator Victoria Espinel released a white paper calling for Congress to change the law to “clarify that infringement by streaming . . . is a felony in appropriate circumstances.” Likewise, the Register of Copyrights noted in 2011 that “unauthorized streaming is a growing threat” for which “prosecutors have little incentive to file charges,” and the acting deputy assistant attorney general just last year said that changing the law will “provide the Department with an important tool to prosecute and deter” criminal infringers.
The law currently on the books was written at a time when uploading and downloading were the dominant means of disseminating works online, but advances in internet speeds have changed that. More people than ever now prefer to stream content in real-time rather than download copies to be watched later. There are numerous legitimate streaming services, such as Netflix, Hulu, and Spotify. But there are also many illicit streaming services, such as cyberlockers and Popcorn Time, and search engines like Google happily drive them traffic. Technology has changed, and the law needs to catch up.
Montgomery wonders “why the Judiciary Committee would even consider taking up an issue like felony streaming.” The reason is simple: To deter large-scale, for-profit copyright infringers from willfully violating the property rights of creators. Federal prosecutors have limited resources, bringing very few criminal copyright infringement cases per year (46 in 2011 and 40 in 2012). This change would empower them to prosecute a handful of the most egregious criminal streamers as felons. Montgomery absurdly suggests that even “an executive at a music streaming company” could be prosecuted if he “didn’t know” about two unlisted writers. The reality is that there are high legal thresholds that must be met to secure a conviction, including the requirement that the infringement be done “willfully.”
Of course, nobody is saying that harmonizing the penalties for streaming and downloading will completely solve the piracy problem, nor is Hollywood “pretend[ing] that streaming isn’t the future,” as Montgomery claims. The reality is that the creative industries have been actively embracing new streaming platforms to distribute their works—as demonstrated in Montgomery’s very own examples of “success,” including iTunes, Netflix, and HBO GO.
The point of closing the streaming loophole is to ensure that legitimate streaming services are even more successful. Everyone knows that streaming is the future, but that future is threatened by competition from illicit streaming services that pay nothing for the works they offer to the public. This isn’t about Hollywood vs. Silicon Valley, as Montgomery frames it. It’s about giving federal prosecutors the tools they need to go after a few criminals so that honest creators and innovators can continue working together on a level playing field.
Barblan is director and Hartline is assistant director at the Center for the Protection of Intellectual Property (CPIP) at George Mason University School of Law. CPIP is dedicated to the scholarly analysis of intellectual property rights and the technological, commercial, and creative innovation they facilitate.