Jennifer Granick & Keith Kupferschmid: A debate for the times

In 1976, the film industry filed a lawsuit to kill the VCR, amid hyperbolic claims that copying TV broadcasts would strangle the movie business. Today, the industry makes a handsome profit from video releases. In 2001, the content industries revved up the hyperbole engines again in their successful campaign to hobble Napster Inc. and efforts to stop file-sharing systems such as Morpheus.

The software, music and movie businesses have labelled copyright infringers “pirates” to both discourage copying and encourage criminal prosecution when copying occurs. Yet, the idea that small-scale, non-commercial copyright infringers are criminals is new. Until five years ago, only bootleggers who mass-produced infringing copies for commercial sale were prosecuted.

This is because copyright law protects different social values than theft laws do. If I steal your wallet, it’s gone. However, if I make an unauthorized copy of a book you wrote, you still can sell the book. Copyright law simply prefers that you make the copies so that you can collect any revenue from sales of your book, making it worth your while to write the book in the first place. Laws against theft protect ownership rights. Laws against infringement balance incentives for you to be creative with the benefits of allowing other people creative uses of the work.

Before the Internet, non-commercial infringement did not substantially interfere with profit streams. Today, we have the ability to instantaneously trade thousands of files in digital format without any degradation of quality. Non-commercial copying now challenges the way content companies do business. As a result, the industries convinced U.S. Congress in 1997 to make small-scale, not-for-profit infringement a crime punishable by up to five years in prison.

But the call for people who create or use file-sharing technology to be imprisoned goes too far. We should hesitate before imprisoning people for something that was not a crime as little as five years ago. The content industry may describe that as a “loophole,” but it more accurately reflects a lack of public consensus that we should send people to jail for using technology that interferes with current corporate business models.

The danger to the content companies is that, in the short run, they are losing profits to freeloaders and, in the long run, the way they do business may be made obsolete. We should protect the first interest but not necessarily the second. There is real danger that a better music or software business will not evolve if the government tries to apply the harsh penalty of imprisonment in copyright cases.

The civil judicial system is the best place for companies to pursue lost profits. Criminal sanctions will chill the adoption of new technologies, and perhaps the next VCR will never come to pass. I’m glad no one went to jail for recording “The Simpsons” for me.

Yes . Keith Kupferschmid

Software piracy is big business. If there is no realistic threat of jail time, a software pirate will consider any civil remedies or criminal fines incurred as simply a cost of doing business. The possibility of serving time in prison, therefore, is essential because it is the only sanction for violating the copyright law that will deter software piracy and punish the pirate for the illegal act.

The software industry has been plagued by piracy for years. In recent years, the problem has grown worse. Technological advances have made it easy for anyone to reproduce and distribute copyrighted works anywhere, anytime and to anyone. These same technologies have made large-scale commercial copyright infringement a major form of theft and fraud all around the world.

On the Internet, piracy rings distribute illegal copies of copyrighted software at a scale, and a rate, previously unimaginable. A growing number of these piracy rings are sophisticated counterfeit operations involving organized criminal elements. John Sankus Jr., co-leader of DrinkOrDie, the largest and oldest organized software piracy group on the Internet, recently was sentenced to the longest term ever imposed for Internet piracy: 46 months in prison.

The problem of software piracy threatens to impede the development of new software products and services. Thousands of small software companies struggle to survive, dependent on a commercially successful product. Pirating of their software may result in the company going out of business or not being able to generate enough revenue to invest in the new products, harming not only the software creator but also users who want new and different software applications. Users who purchase pirated software also are harmed because they receive no documentation, no customer support and no information about product updates.

Software piracy is a federal crime. Commonly defined as the wilful copying or distribution of software for commercial or private financial gain, it is theft. Like all thieves, the perpetrators of these crimes deserve punishment. The punishment must be sufficient to remove the financial reward from pirating software and to deter future acts of piracy. For many software pirates the threat of jail time is the only sanction that satisfies these criteria.

The Software & Information Industry Association (SIIA) has had an active antipiracy program for more than 15 years – conducting software audits, educating the public and filing complaints against alleged pirates. During this time, SIIA has sought criminal penalties against only the most flagrant pirates. Unfortunately, we are encountering these egregious software pirates more often. Increasingly, we have no alternative but to seek criminal sanctions against them. Thankfully, we have the threat of possible imprisonment at our disposal. Without it, we would find ourselves in the fight without a weapon.

Granick is litigation director at Stanford Law School’s Center for Internet and Society. She can be reached at Kupferschmid is vice-president, intellectual property policy and enforcement for SIIA, which is the principal trade association for the software and digital content industry. He can be reached at