Pirates of the Internet

by | Jun 30, 2000

For years, lawyers representing Silicon Valley were rightly emphasizing the importance of intellectual property rights. Such rights were the major issue in the final Uraguay round of GATT meetings. At that time, trade negotiators warned that American companies and their intellectual properties faced a threat from the rest of the world, because many foreign countries […]

For years, lawyers representing Silicon Valley were rightly emphasizing the importance of intellectual property rights.

Such rights were the major issue in the final Uraguay round of GATT meetings. At that time, trade negotiators warned that American companies and their intellectual properties faced a threat from the rest of the world, because many foreign countries failed to protect their patents and copyrights, allowing for blatant piracy and theft. Today, piracy (theft of intellectual property) remains a big problem, particularly in Asia, with pirated software, music, and movies regularly hitting the streets within days of release. But a new and even more dangerous wave of piracy is emerging — and it’s emanating from America.

Computer programs such as Napster and Gnutella have been designed to operate over the Internet, allowing users to find, copy, and download copyrighted materials in a flash. Users are now downloading the equivalent of millions of music compact discs per day – for free. Ironically, it appears that many Silicon Valley lawyers, representing Internet players, are now asking courts to ignore this wholesale violation of copyrights.

To understand the problem, one need not know the complexities of the internet’s connections and programming — but one does need to understand the basic moral principles involved. As philosopher/novelist Ayn Rand wrote in Capitalism: The Unknown Ideal: “Patents and copyrights are the legal implementation of the base of all property rights: a man’s right to the product of his own mind. By forbidding the unauthorized reproduction of an object, the law declares, in effect,…that the value is created by the originator of the idea and may not be used without his consent.”

So just as with any property, no one has the right to take, copy, or enjoy a movie, a book, or a music recording, without the owner’s permission. To do so is theft. It is the attempt to obtain a value from others through the initiation of physical force. It is immoral because one is attempting to obtain a value from others by failing to earn it.

Unfortunately, the attitudes of many members of the “internet generation” are different. They are getting their moral guidance from various Internet industry advocates and “thought leaders,” who seem indifferent to the rights of others. From them one hears suggestions like, “people who rely on copyright probably need to change their business model.” Or “Remember my basic rule: Whatever copy-protection system your programmer can invent, my programmer can break.”

They praise the piracy-enabling internet software as “brilliant” while panning industry attempts to require and enable customers to pay for their products as “cumbersome.” (I suppose if one’s been shoplifting for years, stopping by the cash register seems “cumbersome”, whereas robbing the store is “brilliant”.)

Most Americans cheered in recent years when they heard bootleg compact disk factories in China were being shut down, but now when they download essentially the same bootleg music into their MP3 players, they typically congratulate themselves for being “net-savvy”. The difference is only one of method, not of principle. The ends are the same: the achievement of a value without earning — i.e. paying — for it.

Though the U.S. has represented a bastion of respect for intellectual property rights, the country now seems to be switching sides. Indeed, many of the biggest owners of valuable intellectual properties are now foreign – including Sony (Japan), EMI Plc. (UK), Bertelsmann (Germany), Seagram (Canada), Canal Plus (France), and News Corp. (Australia), and the biggest piracy threats now appear to be coming from numerous U.S. internet users and promoters, demanding the privilege of plundering the properties of mostly non-U.S. companies.

Working within the context of copyright law, global companies like the ones above are developing innovative methods to enable online sales and digital distribution of their works. If these companies can safely use the Internet to sell their products digitally, it could provide them and the artists they represent with immense commercial benefits. However, if intellectual property rights are not respected on the Internet, then piracy could quickly develop into a nightmare. Thankfully, the courts have thus far supported the music industry’s efforts to defend its properties from piracy on the Internet.

Piracy is theft. Stealing is wrong whether it takes place on the high seas, in your local Wal-Mart, or over the Internet.

Andrew West is a Contributing Economics Editor for Capitalism Magazine. In 1997 he received the Chartered Financial Analyst designation from the Association for Investment Management and Research.

The views expressed above represent those of the author and do not necessarily represent the views of the editors and publishers of Capitalism Magazine. Capitalism Magazine sometimes publishes articles we disagree with because we think the article provides information, or a contrasting point of view, that may be of value to our readers.

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