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Tech Industry

Congress looks abroad to curb piracy

Entertainment industry representatives tell Congress the U.S. should urge other countries to adopt better intellectual property protections--while the U.S. may want to consider working with ISPs as Europe has.

The copyright infringers responsible for leaking an incomplete version of the unreleased movie "X-Men Origins: Wolverine" will likely face harsh penalties thanks to strict U.S. intellectual property laws, but copyright enforcement is still woefully inadequate abroad, representatives of the entertainment industry told members of Congress Monday.

One week after the 20th Century Fox film was found on the Internet, the House of Representatives Committee on Foreign Affairs held a hearing in Los Angeles to hear from industry representatives about how to address piracy.

Committee Chair Howard Berman (D-Calif.) said he plans to introduce legislation shortly to bring more attention to intellectual property rights abroad.

The committee plans "to work more closely with other governments to provide the resources, training, legal guidance and tools which they need to alleviate the international piracy that is so devastating to American ingenuity and American jobs," Berman said.

Piracy cost the film industry $6.1 billion in 2005, according to the Motion Picture Association of America, while copyright infringement overall resulted in $18.3 billion in trade losses in 2007, according to the International Intellectual Property Alliance. Copyright infringement also costs the U.S. 750,000 jobs per year, according to the U.S. Chamber of Commerce.

"We just spent billions of dollars on a stimulus package to provide jobs to millions of unemployed Americans, and if we merely focused on curtailing piracy and counterfeiting we would preserve almost a million jobs," Berman said.

While the U.S. government has cracked down on domestic piracy through legislation like the PRO-IP Act, most other countries are far behind, entertainment executives told Berman.

The Organization for Economic Cooperation and Development has estimated that Canada has the highest level of online piracy in the world, Zach Horowitz, the president of Universal Music Group, pointed out in his prepared testimony. He asked the committee to question Canada about its legal deficiencies, such as the lack of authority Canadian customs officials have to seize counterfeit goods.

"Ask them to explain their reputation as a nation unfriendly to the policies at the heart of copyright--and the realities of the borderless digital marketplace," he said.

Many countries also need to enact stronger laws against illegal video recording, said Richard Cook, the chairman of Walt Disney Studios. More than 90 percent of the counterfeit versions of movies recently released to DVD can be traced back to illegal video recording, Cook said. As high-definition camcorders become more easily available and more affordable, he said he expects the problem to increase. Federal legislation in the U.S. had reduced illegal video recording domestically, but it remains a problem in countries such as Ukraine, the Philippines, Thailand, and Mexico.

"The increase in illegal activity in these countries has been dramatic, and there is an urgent need for action," Cook said.

He urged the committee to address this problem in future free trade agreements.

Berman noted in a prepared statement that China has chosen to enforce intellectual property rights selectively. NBC, for instance, successfully worked with Chinese authorities to remove virtually all illegal content from the 2008 Olympics. However, NBC Universal has tracked 250 million views of pirated content on approximately a half dozen Chinese video-sharing sites over the last 15 months.

NBC has been able to tamp down the illegal flow of copyrighted content in the United States as Hulu has grown to become the second most popular online video site in the U.S.

"Our experience has proven that technology can play a major role in addressing intellectual property theft if the people involved are willing to make the effort," Rick Cotton, NBC Universal's general counsel, told CNET News.

According to Horowitz's prepared testimony, getting the right people involved may mean more coordination with Internet service providers. A number of European countries are working with ISPs to prohibit the flow of stolen content.

"Their goal is to combat piracy in a way that is fair to rights holders and fair to consumers," Horowitz said. "We, too, can learn from and benefit from the ideas of our international trading partners."