Whenever we talk about piracy the discussion tends to revolve around the issue of illegal downloads. It’s strange because a much older form of media piracy is still rampant. Counterfeit media products cost the entertainment industry tens of billions of dollars per year and arguably do more damage to the industry than file sharing ever will.
Consider this: When your 16-year-old brother downloads a song or movie from BitTorrent he may or may not consume the product. It’s open to debate whether or not tangible economic damage has resulted from the download. Certainly a copyright has been violated, but it’s difficult to place a value on the damage that has actually been inflicted. In most cases an illegal download does not equate to a lost sale. By contrast, when a consumer buys a counterfeit CD or DVD it’s much easier to assume that a sale has been lost and some real economic damage has resulted from that sale.
While the battle against file sharing is well documented, the battle against counterfeit media products receives much less attention. We tend to think of it as a 20th century problem. Which isn’t entirely the case. Especially when you consider that last year alone the MPAA confiscated 81 million illegally manufactured optical discs. While 81 million bootleg DVDs may sound like a lot, it represents a small fraction of the total number of counterfeit movies manufactured and sold through various channels around the world.
The entertainment industry’s efforts to suppress counterfeit products are mostly limited to seizing shipments of bootlegs at the border and arresting street vendors selling super-cheap DVDs. The problem with this approach is that it misses the largest marketplace for bootlegged media products — the Internet.
Counterfeiters no longer need a network of street vendors to sell their products. Instead, they’re doing brisk business on eBay and in the Amazon marketplace. It’s true that the MPAA has a program in place to nab high volume auctioneers – but that approach is little more than a high tech version of nabbing street vendors.
Right about now you might be wondering why the MPAA doesn’t go after eBay and Amazon? After all, these are publicly traded companies that are clearly benefiting from the sale of pirated goods. As it turns out, both eBay and Amazon are exempt from prosecution. A court ruling in 2000 limited eBay’s liability related to the selling of bootlegged music. The ruling was a result of the Communication Decency Act (CDA), part of which prevents online services from being held accountable for the actions of their users.
In his ruling, Judge Stuart Pollak noted:
“Plaintiff’s attempt to impose responsibility on eBay as the seller of items auctioned over its service is no different from the unsuccessful attempts that have been made to hold computer service providers liable as distributors rather than publishers of defamatory or pornographic materials.”
As a result of this ruling the Amazon Marketplace and eBay have essentially become safe havens for the sale of counterfeit merchandise. It’s true that both companies have strict policies against the sale of counterfeit goods, and both routinely end auctions and cancel user accounts when piracy is reported. However, because neither eBay or Amazon is liable for the actions of its users it’s up to third parties (in this case the entertainment industry) to report potential violations.
So, while the RIAA continues to sue grandmothers and people who don’t own computers for alleged copyright violations, counterfeiters are doing brisk business on eBay and in the Amazon Marketplace. Something is wrong with this picture.
Unfortunately there’s no easy solution to this problem. I generally agree with the law that exempts service providers from being liable for the actions of their users. However, it does seem like the law should take into account situations where the service provider stands to profit from those actions.
In the meantime, it would be nice to see the major entertainment associations acknowledge that piracy is a complex issue, and that the problem is not strictly limited to consumers downloading free movies and music from the internet.