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Rules of business

April 23, 2012

WHEN I started using email towards the end of the millennium, they were written on the now-unimaginable digital blue-screen.

From there to features and programmes such as G-chat, Skype or YouTube in just a few years constitutes a phenomenal jump. Millions of Internet users around the world have kept pace with constantly evolving technology, and love it for precisely this.

But have big businesses done the same? Major media firms, it would seem, are not just wary of but actually opposed to technologies that demands a shift in the way they conduct their business.

Back in 1982, legendary US film industry lobbyist Jack Valenti articulated this stance nicely when he compared the VCR — cutting-edge technology back then — to the Boston Strangler, preparing to murder the innocents of Hollywood.

Today, where the Internet pushes for openness and is challenging the closed, copyright-protected world from before the digital age, the big media houses continue to try to tighten their grip on it as far as possible.

In the past 30 years in the US, media house lobbyists have lobbied for 15 pieces of legislation aimed at tightening their grip over media content. Early this year, though, the Internet fought back.

Resistance by forums including Google and Wikipedia forced the US Congress to shelve two anti-Internet piracy bills that they argued would not just restrict the open nature of the Web, but would also tamper with the very architecture of the medium.

The Stop Online Piracy Act (Sopa) and the Protect IP Act (Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act), or Pipa, sought, in the main, to control piracy of American media — film and television shows — which, according to Creative America (comprised of a collection of Hollywood studios, networks and unions) costs the country’s workers $5.5bn a year.

Had this legislation gone through the US Justice Department, copyright holders would have been able to obtain court orders against foreign websites suspected of perpetrating or facilitating copyright infringements and place embargoes on online advertising networks and payment facilitators from conducting business with such suspects. It would have become legally possible to prevent search engines from carrying links with such sites.

But Silicon Valley fought back, saying the bills would limit free speech, stifle innovation and, most importantly, discourage new digital-age distribution methods. The battle was portrayed as Silicon Valley vs Hollywood, and the former was perceived as having won.

Meanwhile in Europe, a US-backed international treaty, the Anti-Counterfeiting Trade Agreement (Acta) sparked protests acros  the continent and a number of countries, including the Netherlands, Poland and Germany, have refused to sign it.

The opponent of Acta feel that it bypasses the sovereign laws of participating nations and would force the world’s ISPs to act as the Internet police.

The proponents of tight copyright enforcement — mainly the interest groups such as the big business media houses — may have taken a hit, but by no means are they out for the count. Recently, the media giant Viacom — owner of the Comedy Network and Paramount Pictures — has revived a $1bn suit against Google’s YouTube for allowing users to access copyrighted material from its shows.

Rupert Murdoch of the News Corps empire lashed out at President Barack Obama for “throwing in his lot with Silicon Valley paymasters” and tweeted: “Piracy leader is Google who streams movies free, sells advts around them.”

But it’s not quite that simple as Hollywood vs Silicon Valley. First, what brought down Sopa, Pipa and in some countries, Acta, was not just lobbying by Internet companies or Silicon Valley but millions upon millions of people — ordinary people — who resisted them.

The Internet has brought new meaning to the phrase ‘one man, one vote’. While the pre-digital age media industry can be pinned down as being run by a set of suits in a boardroom, the Internet prides itself on being ‘run’ by citizens across the globe, all of them with a say and a stake in the system.

In the days that Sopa was still on the table, one US senator’s office alone received over 3,000 calls about it in a single day.

What the Internet has achieved is the democratisation of the media.

Second, at the heart of the anger over perceived copyright infringements is the media houses’ desire to stick with their traditional methods of business and distribution, and retain control over their products in the pre-Internet fashion.

Proponents of the ‘new media’, meanwhile, argue that new technologies demand new ways of doing business. There are companies that have adapted to the challenges and opportunities presented by the Internet terrain, notable among them being Amazon and iTunes. They give consumers on-demand content at reasonable prices, while turning over massive profits.

The shift being faced by the visual media industry has already been experienced by the music industry, which has had to create online alternatives to the traditionally distributed CDs.

There is little doubt that, in the long run, the visual media industry will have to follow suit. An increasing number of analysts feel that the Web has changed the playing field more or less entirely as far as the rules of doing business are concerned.

There is little advantage to trying to force people to play by the old rules when innovative methods that more easily meet the consumers’ needs — on-demand and easily available/accessible content — can be developed.

It’s not really about the advantages of the new versus the old, in fact. It’s about new technologies making it possible to give everybody — including the media giants’ appetite for profits — more of what they want.

The writer is a member of staff.