What could be the impact of SOPA on the Caribbean?

The draft Stop Online Piracy Act (SOPA) is currently being debated by the US legislature, but it has been severely criticised by tech experts and the industry at large. It aims to protect US Intellectual Property, and has been designed with considerable reach that could affect us the Caribbean.

Yesterday, the Judicial House Committee, one of the standing committees of the US House of Representatives held a hearing on the proposed Stop Online Piracy Act (SOPA), a highly controversial Bill introduced in October this year. Opponents to the Bill fear that it will irrevocably be to the detriment of the Internet, while its supporters believe that it will protect US innovation, jobs and revenues. This post briefly examines some of the issues surrounding SOPA and discusses possible implications to us in the Caribbean.

SOPA highlights

Opening statements for the Bill indicates that the purpose of SOPA is:

To promote prosperity, creativity, entrepreneurship, and innovation by combating the theft of U.S. property, and for other purposes. (Source: GovTrack.us)

The key provisions of the Bill can be summarised as follows (Sources: GovTrack.us, PCWorld, NetCoalition.com):

  • It authorises the US Attorney General to seek court orders against foreign Internet websites that conduct business in the United States and/or are accessed by US residents that are committing or facilitating online piracy, to cease and desist activities constituting Intellectual Property (IP) offences.
  • For websites accused of copyright infringement and through a court order, the Attorney General can require online advertising networks, payment processors, search engines, ISPs, and domain name registrars to stop doing business with those alleged offending websites.
  • Online advertising networks, payment facilitators, search engines, ISPs, etc., complying with an order cannot be sued for doing so. Further, should any one of those businesses, of their own initiative and without a court order, decide to cease doing business with an entity that is committing or facilitating an IP offence, it cannot be sued for doing so.
  • It empowers copyright owners whose IP rights have been breached to sue both US and foreign websites that are “dedicated to the theft of U.S. property”
  • Finally, persons can be subject to criminal prosecution (a felony) for streaming copyrighted works without permission over the Internet. For a first offence of streaming 10 pieces of music or movies within a six-month period, can result in up to five years’ imprisonment.

The wide abyss between advocates and opponents

Those who are in support of the Bill are of the view that the US loses billions of dollars annually due to piracy being conducted via the Internet. The affected sectors are not just limited to technology and media, but also include medication, automotive parts and certain food items. Hence SOPA would protect the US’s IP, as well as jobs, revenues, and the industries that have been adversely affected by online piracy.

On the other hand, a broad range of concerns about the implications of SOPA are being expressed by a number of influential industry players, such as Google, Yahoo, Facebook, Mozilla, AOL, EBay and the ISOC. Some of the issues raised include its impact on:

  • Current legislation that govern digital copyright issues – it conflicts with provisions under the Digital Millennium Copyright Act (Source: NetCoalition.com)
  • Internet security – especially as it relates to Domain Name Systems (DNS) filtering, which is the mechanism being proposed to block particular websites, but the ISOC is of the view that

… DNS filtering will be ineffective for that purpose and will interfere with cross-border data flows and services undermining innovation and social development across the globe.

  • Tech start-ups and venture capital – a recently published Booz & Company study revealed that if SOPA became law, financial support of tech business could drop by as much as 70%.
  • Web businesses – the Internet in the US might no longer be an enabling environment for businesses, and may even lead a number of online operations to relocate out of the US to avoid, what might be, an onerous environment.

Most critically, it is argued that SOPA would stifle innovation, and is inconsistent with the collaborative medium that the Internet fosters. Furthermore, it has been reported that those who proposed the legislation lack the technical expertise to fully understand its implications, particularly is it relates to Internet security, which was one of the main observations made about the 16 November Judicial House Committee hearing (Source: CNET).

Possible implications for the Caribbean region

Due primarily to the affordability and options available, a considerable number of websites originating and managed in the Caribbean are hosted in the US. This means they would be subject to SOPA, if it were passed.

More importantly, Caribbean web businesses that might have been inspired by those developed in the US, but catering to needs of the individual countries, the region, and/or the Diaspora, could also find themselves in breach of SOPA, and subject to the penalties stipulated. Hence SOPA could not only hinder content and web development in the region, critical elements to developing an Internet Society, it could also have a negative impact on our tech industry and regional innovation, as there would be the constant and looming threat of prosecution from the US.

However, the potential impact of SOPA, does begin to highlight our (over) reliance on the US, and perhaps should be seen as a wake-up call for us in the region to become a bit more independent of our neighbour to the north. Should SOPA be passed without significant amendment to its current form, it is indeed possible that online businesses currently resident in the US could look to relocate overseas. Hence there could be a number of opportunities that we in the region could exploit, due to our geographic proximity to North America, if we are prepared to position ourselves for that eventuality.

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2 Comments

  • I think it’s a question of when, rather than if, one form or the other of SOPA is legislated, probably in every country. It’s common knowledge that legislation has not kept up to speed with the onset of the internet.

    • I wholeheartedly agree, at least in respect to some version of SOPA inevitably being enacted. Hopefully good sense and technical expertise will prevail, and whatever version that is eventually implemented would minimise some of the disadvantages currently identified, and would be more effective…

      However, it is important to emphasise that many tech experts have difficulty with the current IP framework. They are of the view that the framework was designed 150 years ago when it was necessary to incentivise creativity – people getting paid and recognised for their works. However, in this day and age, those requirements might no longer be necessary to the same degree, since virtually everyone has to tools to become a creator in his or her own right. So SOPA might be a tiny element in a considerably larger picture…

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