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Why the SMART Copyright Act Is a Smart Idea

Why the SMART Copyright Act Is a Smart Idea

October 7, 2022

Many digital economy issues require more than new laws to effectively address the complex and dynamic aspects. Frequently, they also require new forms of cooperation or revised and renewed cooperation, as is the case for U.S. digital copyright policy. On March 17, 2022, Senators Tillis (R-NC) and Leahy (D-VT) introduced the Strengthening Measures to Advance Rights Technologies (SMART) Copyright Act of 2022. Among other provisions, this bill would require platforms and rightsholders to work together, creating “effective standardized technical measures (STMs) to identify and protect against distribution of stolen content.” The SMART Copyright Act can help address a historical gap in U.S. digital policy, creating a better balance between creators’ rights and platforms’ interests. Congress should pass this legislation.

When Congress enacted the Digital Millennium Copyright Act (DMCA) in 1998, policymakers intended for platforms and rightsholders to work together, but as a press release from Senator Tillis’ office states, “[R]ather than incentivizing collaboration on technologies to protect copyrighted works, the law actually inhibits it because service providers cannot risk losing their valuable safe harbors if an STM is created.” Safe harbor provisions protect online services from certain liability if a user of their service infringes on someone’s copyright, but an online service must implement existing STMs to qualify for safe harbor protections. If no STMs exist, online services easily qualify for safe harbor provisions. The potential legal and financial liabilities create a perverse incentive where firms don’t want to work with rightsholders to develop STMs.

The DMCA established three requirements for STMs, that: 1) they are developed with a consensus of rightsholders and online service providers in an “open, fair, voluntary, and multi-industry standards process;” 2) they are available to anyone on “reasonable and nondiscriminatory terms;” and 3) they “do not impose substantial costs” on service providers. Despite the existence and sporadic use of several technological measures to combat digital copyright infringement, as Senator Tillis’ office notes, “no STMs have been identified since the law took effect.”

Congress introduced the SMART Copyright Act to remedy the issue and create a genuine incentive for online service providers to cooperate with rightsholders. The SMART Copyright Act requires the Register of Copyrights, in collaboration with other government experts, to engage in public triennial rulemaking to designate STMs. As Senator Tillis’ office notes, under the DMCA’s current system, any stakeholder can “destroy consensus by choosing not to participate” in identifying or developing an STM. The SMART Copyright Act’s new mandated procedure excludes such voluntary STMs without affecting safe harbor provisions.

Despite anti-IP proponents’ worn-out, irrelevant, and hyperbolic claims that STMs—like all other online copyright protection provisions—will “break the Internet,” the SMART Copyright Act merely enables and incentivizes cooperation between rightsholders and service providers regarding the development of STMs. In essence, this brings this missing part of DMCA to life. These measures would ensure greater enforcement of constitutional rights in the digital realm for photographers, artists, musicians, writers, playwrights, choreographers, game developers, and filmmakers, among countless other creatives, large and small.

As ITIF noted, the current notice-and-takedown process has resulted in a constant game of “whacka-mole,” where rightsholders request a website to take down infringing material, only to find it quickly back up on the same site or another one. The expense of pursuing and responding to so many takedown requests exacts a financial toll on content owners and online service providers, expenses which are ultimately passed on to consumers in the form of higher prices. Widespread piracy has a negative economic impact, seriously harming the artists who create content and the technicians who produce it. Piracy limits the ability of content producers to create legitimate business models for selling digital content. It hurts U.S. competitiveness as the U.S. economy has a competitive advantage in content industries. And it hurts law-abiding consumers who must pay higher prices for content (or have access to less content or lower-quality content in the marketplace) to compensate for the costs of piracy. And while innovative, legitimate alternatives to piracy have continued to blossom on the Internet in recent years, piracy has also continued to grow, especially in the wake of the COVID-19 pandemic.

Digital piracy is a significant threat to industries and economies. Congress must act to protect American creators, and enacting the SMART Copyright Act is a smart next step.

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