CEA CEO Criticizes Record and Movie Companies on Copyright

September 17, 2002. Consumer Electronics Association (CEA) P/CEO Gary Shapiro gave a speech titled "The Campaign to Have Copyright Interests Trump Technology and Consumer Rights" at the Optical Storage Symposium, in San Francisco, California. He bluntly criticized the copyright related actions and arguments of the movie and record companies, and their supporters in the Congress and Justice Department.

He stated that "We are at a critical juncture in history when the inevitable growth of technology is conflicting with the rising power and strength of copyright owners. How we resolve this tension between copyright and technology will define our future ability to communicate, create and share information, education and entertainment."

Shapiro reviewed recent development in technologies for the reproduction, storage, and transmission of all types of media. He stated that "Based on these and similar threats the content community has gone on a scorched earth campaign -- attacking and burning several new recording and peer to peer technologies. They have used the Congress, media and courts to challenge the legality of technology and morality and legality of recording."

He asserted that the "consumer electronics companies have been working with both the recording and motion picture industries on developing technological measures that meet the needs of both industries", but the "copyright community has declared war on technology and is using lawsuits, legislatures and clever public relations to restrict the ability to sell and use new technologies."

He reviewed and criticized recent legal actions by record and movie companies (which he refers to as "the copyright community'), bills recently filed in Congress with the support of record and movie companies, and a recent speech by a Department of Justice official regarding possible criminal prosecution of peer to peer networks.

He also discussed the debate and media campaigns regarding the characterization of downloading copyrighted content on the Internet. He stated that "The entire theme of the copyright community is that downloading off the Web is both illegal and immoral. But is it either? I submit it is neither. Despite the assertions of the Justice Department, downloading is not illegal."

He singled out for criticism John Malcolm's speech to the Progress and Freedom Foundation in August. Malcolm is the Deputy Assistant Attorney General in charge of the Computer Crimes and Intellectual Property Section (CCIPS).

Shapiro elaborated that "fair use rights are guaranteed to consumers by statute, and applied judicially on a case by case basis. This means that, while some consumer practices ultimately could be adjudicated as either fair use or infringement, there is scant basis for challenging them as criminal."

He also argued that downloading copyrighted content is not immoral, or comparable to stealing tangible property. "To make downloading immoral, you have to accept that copyrighted products are governed by the same moral and legal principles as real property, thus the recent and continuous reference by the copyright community to label downloading as stealing.  But the fact is that real and intellectual property are different and are governed by different principles. Downloading a copyrighted product does not diminish the product," said Shapiro.

He said that the "recording industry and motion picture industry should stop complaining so much and look for technological solutions to its own problems."

He also offered his advice for policy makers, including: "advances in technology should not be restricted", "claims of harm should be greeted with great skepticism", "copyright owners have a high burden of proof before any technology should be restricted", "copyright owners should continue developing ways to protect their content at the source, rather than insisting that the burden should be on the device that plays it", and "any restrictions on technology should be narrowly crafted, define limitations on abuse by copyright owners and define legitimate consumer recording rights and expectations".

He concluded that "If the play button becomes the pay button, our very ability to raise the world's standard of living and education will be jeopardized."