The Corporate Titans Take On the Internet

MEDIA, WHISTLEBLOWING - SURVEILLANCE, 19 Mar 2012

Peter Frase – Al Jazeera

The fight over copyright is not a struggle between capital and labour, but one between different factions of capital.

American politics is riven by an increasingly contentious debate over the status of intellectual property, especially copyright. On one side are those who argue that tougher enforcement of IP is desperately needed to protect the rights of creators, promote innovation, preserve jobs, and ensure economic growth. Opposing them are those who argue that the draconian enforcement of intellectual property rights will only curtail free speech and stifle economic activity, while entrenching the profits of a small class of digital-age rentiers.

How we resolve the tension between freedom of knowledge and intellectual property protection will have a profound impact on the kind of society and economy we become. But this debate is not merely a contest of ideologies – it is also a clash between some of the most powerful corporate actors in American politics with the rest of us caught in the middle. This is one important reason that the contending sides in this debate do not line up with the typical partisan or ideological cleavages in US politics, such as Democrat vs Republican, liberal vs conservative, left vs right.

Take, for example, the debate over the Stop Online Piracy Act (SOPA) and its Senate counterpart, the Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act (PIPA). The bills were promoted as necessary responses to copyright infringement, but they would also have imposed serious restrictions on Internet communication.

In order to disrupt the distribution of copyrighted material, such as music, movies, software, or books, copyright holders would have been given the power to cut off the flow of payments to allegedly infringing foreign websites, without ever having to prove their case in court. The government would have been given the power to “blacklist” sites, essentially disappearing them from the American Internet. Sites could be targeted even if they did not provide access to copyrighted material, but only to tools for circumventing these bills’ censorship provisions, including tools used to circumvent government censorship in places like China and Iran. And the law would have been open to easy abuse for those who wanted to use the claim of copyright infringement as a cover for censorship, such as governments demanding that YouTube remove videos of police brutality (something Google claims has already occurred).

For those of us accustomed to seeing the copyright lobby get its way in Congress as a matter of course, the resistance to SOPA and PIPA was surprisingly strong and effective. A grassroots campaign was organised by advocacy organisations like the Electronic Frontier Foundation, but major Internet companies also opposed the legislation. On January 18, web sites including Wikipedia and Reddit shut down to register their opposition. A few days later, voting on SOPA was indefinitely postponed, and its lead sponsor announced that it would be re-drafted.

Beyond partisan divisions

The coalitions that lined up on each side of the issue crossed the normal partisan divisions in American politics, as reported by Zach Carter and Ryan Grim. In the House, SOPA was introduced by right-wing Republican Lamar Smith, a member of the Tea Party caucus. But among the bill’s cosponsors were a number of liberal Democrats, including John Conyers, Jr, lately a fan of liberals due to his full employment jobs bill. On the other side, an equally motley crew of representatives quickly came out against SOPA and PIPA, with Democrats like Zoe Lofgren and Anna Eshoo standing alongside far-right figures like Ron Paul and even Michele Bachmann.

It’s tempting to read the backlash to SOPA and PIPA as an example of grassroots mass movements fighting back the corporate power of the copyright cartels, or as the manifestation of a libertarian-statist divide that cuts across typical partisan cleavages. But it is just as significant that these bills exposed a deep division between two factions of big Capital, forcing leftists and liberals to decide which faction to side with.

The surprising coalitions in Congress most likely reflect an equally unusual division among the corporate interests that move policy in Washington. A number of big corporations and industry groups came out strongly against SOPA and PIPA, including Facebook, Google, and the Consumer Electronics Association. That is perhaps why Lofgren – whose district covers an area around San Jose, California – took the lead in opposing the bills in congress. On the other side, the endorsement of SOPA by the AFL-CIO labour federation helps explain how Conyers found himself on the same side as the Motion Picture Association of America, Pfizer, and Mastercard.

Conyers and his labour allies may have been in the minority of voices on the liberal side of the debate, but they were hardly alone. There are many who lament the disappearance of jobs in traditional media production, and sympathise with arguments like that of the journalist Robert Levine, who calls technology companies “digital parasites” bent on demolishing the economic foundations of media creation.

Conyers defended his support of SOPA by claiming that it would “protect jobs” in creative industries, despite the weak support for this claim either empirically or in terms of economic theory. People like Conyers make valuable advocates for the intellectual property lobby, since working writers and artists are a sympathetic group when contrasted with big media companies parasitically making money by copying their work. But to frame the issue this way misrepresents the fight over SOPA and similar legislation as a struggle between capital and labour, when it is really a struggle between two different fractions of capital.

Clash of the corporate titans

There is a divide between those companies that make money by selling access to content, and those that make money by controlling the content distribution networks. For content sellers like the music business, harsh intellectual property laws are desirable because they create the artificial scarcity upon which their whole business model depends. Companies like Facebook and Google, in contrast, still mostly make their money by controlling the platforms on which people distribute various kinds of media, and selling access to their user base to advertisers. For them, looser copyright laws don’t necessarily pose a threat to profits, and in fact they facilitate the business model: By increasing the amount of copying and sharing, they increase the popularity of the distribution networks, which in turn makes them more valuable to advertisers.

Faced with a clash of the corporate titans, it’s tempting for the Left to wish a pox on both their houses. The pro-IP lobby has certainly done much to earn its bad will, by pursuing abusive lawsuits against file-sharers and criminal charges for the sin of downloading too many academic articles.

But the new social network robber barons have their own malevolent side, as demonstrated by the evasive and ever-shifting privacy policy (or lack thereof) of Google and Facebook. In the fight over IP, why privilege one over the other? Is there any reason to regard the social network capitalists as the progressive face of the bourgeoisie?

It is, in a sense, accurate to call them parasites: They profit from the labour and creativity of users who make, remix, upload and share content for free. In contrast to the pro-intellectual property side, however, they do at least accept the existence of a cultural milieu based on sharing and access to knowledge, rather than trying to restrict it by tightly controlling access to information.

Contrast this with a pro-IP propagandist like the aforementioned Levine, who demands not merely a right not be copied but a “right not to be remixed”. Strong intellectual property protections are a recipe for a stultified world in which creativity and innovation are foreclosed by a thicket of laws.

This has led some to see the distribution-network capitalists as allies in the struggle for access to knowledge and culture. The French economist Yann Moulier-Boutang, for example, argues that Google poses a threat to “the united front maintained by the intellectual property advocates” because “they have built an economic model that meshes with this free-use era”. He goes on to say:

Google represents a huge step forward. It forced the gaps wide open and caused a crisis, or at least an awkward predicament, for those supporting the proprietary system. This is why I believe it is strategically sound to create an alliance with Google to dismantle old, archaic models, even though I feel we simultaneously need to be ready to fight it, because Google’s goal is to make money, and the company could, in any case, be bought out by Chinese pension funds or anyone else at any point, which could easily lead to problems, especially around the issue of privacy, since Google uses personal data.

In the specific instance of the fight over SOPA and related bills, Moulier-Boutang is persuasive however odd or silly the idea of an “alliance with Google” might sound. In practice, controversies like the SOPA fight force everyone to be in an alliance with Google or an alliance with the Motion Picture Association of America.

But we don’t need to wait for a Chinese buyout to see the dangers of a social media company with a monopoly position, which is why there is growing discussion about the need to regulate such companies. If the copyright lobby threatens to lock up knowledge within endless, restrictive copyright protection, the companies that control digital distribution pose a different threat: that information will be trapped within proprietary distribution networks and cut off from the open Internet. (Amazon is attempting to establish a monopoly on the e-book market with its Kindle platform, while Apple has attempted to force authors on its iBooks platform to sell only through Apple.)

Untenable status quo

In the long run, access to knowledge, and the livelihoods of knowledge workers, are threatened both by the artificial scarcity of the intellectual property form and by the monopolies of the digital distributors.

But when it comes to attempts to intensify state surveillance and enforcement in defence of IP, we shouldn’t let the impure motives of the network capitalists distract us from the bigger picture. Progressives who defend the moral right of copyright owners to profit from their works may believe that they are defending the rights of struggling artists and inventors, or staking out a left-wing alternative to a nefarious new form of postmodern capitalism.

But in the digital age, the status quo is untenable; the options before us are either to accept an increasingly authoritarian system of intellectual property enforcement, or to find new ways of supporting creative work and innovation. The economist Dean Baker, for example, has suggested the Artistic Freedom Voucher as an alternative to copyrights, and prizes as a replacement for patents.

These are forward-looking, progressive alternatives. The intransigent defence of intellectual property, in contrast, only shores up the ideological legitimacy of the most reactionary and ossified parts of capitalism – elements that are taking us in the direction of a dysfunctional rentier economy.

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Peter Frase is an editor at Jacobin Magazine and a PhD student in sociology at the CUNY Graduate Centre.

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