Published January 12, 2012

What SOPA and PIPA Could Mean for the Tech World

Another Misguided Government Attempt to Rein In Technology

By Chris Wood, Senior Analyst

Recent history is rife with examples of legislative attempts to rein in technology that lawmakers feared would aid in the disruption of the political and economic status quo. This is often (if not always) done under the guise of providing "protection" to some worthy group of citizens or society as a whole. Two examples that come to mind from the '90s include the Digital Telephony Act (also known as the Communications Assistance for Law Enforcement Act, or CALEA) and what became known as the Clipper Chip Controversy.

CALEA, passed in October 1994, requires telecommunications carriers to "ensure that its equipment, facilities, or services that provide a customer or subscriber with the ability to originate, terminate, or direct communications are capable of enabling the government, pursuant to a court order, to intercept all wire and electronic communications carried by the carrier." What was going on at the time was that law enforcement officials said they were worried that new digital networks would render existing phone surveillance techniques useless, so they passed this legislation forcing phone companies to make their networks accessible to law-enforcement wiretaps. In addition to effectively institutionalizing electronic eavesdropping, the bill also required all future technology to accommodate the FBI's electronic surveillance desires.

CALEA was controversial. The debate over the privacy concerns that it raised raged for years – from the time an earlier version of the legislation was introduced in 1992 until well after the Act became law. But that debate was overshadowed by the much more public controversy over the Clipper Chip.

Authorized by the Clinton White House in April 1993, the Clipper Chip program emerged in early 1994 as the Escrowed Encryption Standard (EES). The stated purpose of the program was to offer telecommunications privacy to individuals, businesses, and government, while allowing law enforcement to listen in on suspected criminals. But it was much more.

Clipper was developed by the NSA for telephone communications. It provided security through a new standard of encryption but only the government would hold the keys to unlock it. The idea was to install one of these Clipper Chips in every phone. While access to the decryption keys was to be permitted only as "legally authorized," privacy advocates immediately questioned the vague and broad use of that term.

Fortunately, the Clipper Chip proposal had sufficient flaws that by mid-1994 the administration began backing away from the idea. By 1996, Clipper was dead.

Today, two proposed laws – both promoted in the name of protecting certain groups' rights – stand ready to wreak havoc on the technology sector: the Stop Online Piracy Act (SOPA) in the House and the Protect IP Act (PIPA) in the Senate.

The stated purpose of H.R. 3261 (SOPA) is "to promote prosperity, creativity, entrepreneurship, and innovation by combating the theft of U.S. property, and for other purposes." Meanwhile, S. 968 (PIPA) is supposed to "prevent online threats to economic creativity and theft of intellectual property, and for other purposes."

Both bills sound innocuous on the surface. But the potential fallout effects have galvanized leading technology companies, venture capitalists, entrepreneurs, start-up CEOs, and activists like the Electronic Frontier Foundation (EFF) to oppose them.

For example, the new group Engine Advocacy, created to give tech entrepreneurs a voice in government, has been roused into action by opposition to the two bills. More than 300 entrepreneurs and investors showed up at the first organizational meeting the group held last month. What's more, companies including Google, Facebook, Twitter, PayPal, Foursquare, Zynga, Etsy, Yahoo! and Wikipedia are said to be discussing a coordinated temporary blackout of services, in protest against the potential negative effects of SOPA and PIPA on the Internet.

What is it that has so many people up in arms?

SOPA represents the latest effort from Hollywood and its allies to fight what they see as rampant piracy on the Internet. The bill was introduced by Lamar Smith (R-TX) in late October 2011. However, due to the outrage the first version of the bill generated, Smith offered a 71-page amendment on December 12, which attempted to address some (but not most) of the criticisms directed at it.

In addition to making the act of streaming copyrighted works on the Internet a crime punishable by up to five years in prison, SOPA would allow the US Attorney General to seek court orders to stop online ad networks and payment processors (like PayPal) from doing business with foreign websites accused of enabling or facilitating copyright infringement. The court orders could also require ISPs to prevent their subscribers in the US from accessing these sites and could prohibit search engines (like Google) from providing a direct link to them. The goal is essentially to disappear an offending site by blocking various means of access to it and inhibiting its ability to conduct business – kind of an Internet death penalty, with no appeal.

PIPA is basically the Senate's version of SOPA, though it's slightly less broad based. PIPA targets only domain-name system providers, financial companies, and ad networks, not companies that provide Internet connectivity.

Opponents of the bills are not suggesting that copyright laws do not apply to the Internet. They merely argue that SOPA and PIPA are really bad ways of attacking a legitimate problem.

For starters, free-speech advocates point to the vague language in the bills that they say will create new tools for silencing legitimate speech all around the Web. In fact, even supporters of the bills have been forced to admit that they would result in some censorship. Famed First Amendment lawyer Floyd Abrams (who was actually contracted by the MPAA and other trade groups to write a letter saying SOPA does not violate the First Amendment) conceded that, "regardless of the particular standard or definition of foreign infringing sites, court-approved remedies under the Stop Online Piracy Act may result in the blockage or disruption of some protected speech."

Meanwhile, a large group of attorneys specializing in IP (intellectual property) law has come together to voice its concerns with the bills. Among other things, the group claims that the way copyright infringement on the Internet is redefined not only conflicts with Supreme Court precedent "but would make YouTube, Google, and numerous other web sites liable for copyright infringement."

At the heart of the matter is the likelihood that no one on the Internet would be untouched by this legislation. And the unintended consequences would reach far and wide. Alex MacGillivray, general counsel for Twitter, recently wrote a telling hypothetical piece explaining how the legislation (SOPA in this case) would affect millions of "ordinary, non-infringing users."

Many of the architects of the Internet itself have joined the fight. A group of 83 prominent Net inventors and engineers has warned that SOPA and PIPA "will create an environment of tremendous fear and uncertainty for technological innovation, and seriously harm the credibility of the United States in its role as a steward of key Internet infrastructure." These technologists have also identified a whole new set of problems associated with the legislation – that it will also inadvertently undermine Internet security. They write:

Regardless of recent amendments to SOPA, both bills will risk fragmenting the Internet's global domain name system (DNS) and have other capricious technical consequences… Censorship of Internet infrastructure will inevitably cause network errors and security problems. This is true in China, Iran and other countries that censor the network today; it will be just as true of American censorship. It is also true regardless of whether censorship is implemented via the DNS, proxies, firewalls, or any other method. Types of network errors and insecurity that we wrestle with today will become more widespread, and will affect sites other than those blacklisted by the American government.

[Ed. Note: If you're interested in a technical explanation of the security and other technical concerns raised by the legislation, we recommend reading the whitepaper Security and Other Technical Concerns Raised by the DNS Filtering Requirements in the Protect IP Bill.]

At the end of the day, SOPA and PIPA would probably do little to actually stop piracy and protect IP. But they would succeed in wreaking havoc on the Internet and harming many legitimate online businesses and non-infringing users while hindering technological innovation. Stay tuned – both of these bills are up for debate in their respective houses in the coming weeks. We'll keep you posted.

[There's another battleground in technology that deserves your attention. Hardly anyone is aware of it, but it's turned into a fierce war that can lead to outsized gains for those who back the victors. For the story, read this special report.]

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