Ratify the Anti-Counterfeiting Trade Agreement (ACTA).

In an age of such easy global communications, the threat of piracy is far greater for creative industries than it has ever been before. There is a huge difference between a few cheap video copies and global downloads available free of charge. With sites making movies that cost millions available for free, it poses a real threat to major studios. For example The Institute for Policy Innovation believes the global music industry loses $12.5 billion a year due to piracy resulting in 71,060 lost jobs.[i]

The fact that these sites are so popular demonstrates that music and movies are popular but that people are unwilling to pay real cost of producing that quality of product.

The reality is that creative material is produced not just by a handful of millionaire actors and producers but by thousands of screen-writers, technicians and backroom staff; all of whom have to be paid. To do that studios, music producers and publishers need some guarantee of a return on their initial investment.

[i] Siwek, Stephen E., ‘The True Cost of Sound Recording Piracy to the U.S. Economy’, The Institute for Policy Innovation, 21 August 2007.

We should be wary of any figures set on losses to the economy as a result of piracy, mostly because the coinsumer who is downloading pirated materials will simply use his dollars elsewhere.[i] There have also been studies that show that these same people who illegally download also spend more on legal downloads.[ii] Moreover this should really be seen just as a spur to innovate. Those who benefitted from film were happy enough with the impact that cinema had on theatre, music producers happy enough with the impact that musical electrification, global distribution methods and broadcasting had on the music industry. Objecting that new technologies require some new thinking is ridiculous and smacks of protectionism from industries that, increasingly, seem to have lost the battle of ideas. ACTA is anti-competitive and aims to protect the interests of outdated approaches against new and imaginative thinking.

[i] Raustiala, Kal, and Sprigman, Chris, ‘How Much Do Music and Movie Piracy Really Hurt the U.S. Economy’, Freakonomics, 12 January 2012.

[ii] Michaels, Sean, ‘Study finds pirates 10 times more likely to buy music’, guardian.co.uk, 21 April 2009.

Companies that accept huge research costs – such as the pharmaceutical industries – need the surety of knowing that they will have some payback for that research. Without that there is little point in them undertaking the research in the first place and medical science will suffer.

It’s easy to say that manufacturing a pill only costs two cents – the reality is that a trial alone can cost upwards of $100m with the whole research and development per approved drug costing billions.[i] The framework

 for doing that is one that requires a profit for investors and security for researchers.

Allowing for generic medicines to undermine that end point profit discourages the necessary blue-sky thinking and ground-breaking research as they’re risky and may not see a financial return. As a result, those medicines that are proven ‘sellers’ need to make the profit for the long-term investment that will be required for cures for cancer, AIDS and other global killers. Stopping pharmaceutical companies from making a healthy profit on established antibiotics and similar medicines means that they then don’t have the financial muscle to be able to fund the long development and large amount of research necessary to create the drugs of the future. If they then believe those drugs will quickly be recreated and turned into generics they will give up researching entirely.

[i] Herper, Matthew, ‘The Truly Staggering Cost of Inventing New Drugs’, Forbes, 10 February 2012.

The reality is that antibiotics and similar medicines are mostly sold to Monopsonistic  governments and don’t represent the profit base of big Pharma. Instead they have focussed on products such as Prozac that are high-profit by their nature, while thirty-year old antibiotics are left to become ever less effective against evolving viruses.[i].

[i] Gouge, Deborah, ‘Big Pharma Abandons Antibiotics: An Opening For Small Biotech’, Seeking Alpha, 13 May 2012.

There is a genuine value to a brand – in part because, for clothing companies for example, it is a mark of quality as much as it is of origin. However even if that were not the case, the brand identity of a company is part of its legal property and should be protected in the same way and stock or cash against theft.

The very fact that people are so keen to buy branded clothing and other products – even when pirated – demonstrates that there is a value to those brands.

ACTA doesn’t seek to control people’s  rights to wear any pair of jeans or trainers or other type of product. It simply says that if someone wants to own Levi jeans or Nike trainers they should pay the price set by Levis or Nike. If they don’t want to pay the premium then they are at liberty to buy different unbranded products.

Were proposition’s case true then it would raise the question of why no consumers groups have been involved in the negotiations or representative of cloth and other manufacturers in the developing world – or for that matter the originators of design techniques more generally. The only people consulted were the stakeholders of extremely wealthy brands; mostly price-gougers with appalling records in terms of how they spend that money as it relates to the payment of workers or suppliers. This agreement serves purely for the protection of a wealthy few and against the interests of the overwhelming majority in the industries they represent.

In an age of such easy global communications, the threat of piracy is far greater for creative industries than it has ever been before. There is a huge difference between a few cheap video copies and global downloads available free of charge. With sites making movies that cost millions available for free, it poses a real threat to major studios. For example The Institute for Policy Innovation believes the global music industry loses $12.5 billion a year due to piracy resulting in 71,060 lost jobs.[i]

The fact that these sites are so popular demonstrates that music and movies are popular but that people are unwilling to pay real cost of producing that quality of product.

The reality is that creative material is produced not just by a handful of millionaire actors and producers but by thousands of screen-writers, technicians and backroom staff; all of whom have to be paid. To do that studios, music producers and publishers need some guarantee of a return on their initial investment.

[i] Siwek, Stephen E., ‘The True Cost of Sound Recording Piracy to the U.S. Economy’, The Institute for Policy Innovation, 21 August 2007.

We should be wary of any figures set on losses to the economy as a result of piracy, mostly because the coinsumer who is downloading pirated materials will simply use his dollars elsewhere.[i] There have also been studies that show that these same people who illegally download also spend more on legal downloads.[ii] Moreover this should really be seen just as a spur to innovate. Those who benefitted from film were happy enough with the impact that cinema had on theatre, music producers happy enough with the impact that musical electrification, global distribution methods and broadcasting had on the music industry. Objecting that new technologies require some new thinking is ridiculous and smacks of protectionism from industries that, increasingly, seem to have lost the battle of ideas. ACTA is anti-competitive and aims to protect the interests of outdated approaches against new and imaginative thinking.

[i] Raustiala, Kal, and Sprigman, Chris, ‘How Much Do Music and Movie Piracy Really Hurt the U.S. Economy’, Freakonomics, 12 January 2012.

[ii] Michaels, Sean, ‘Study finds pirates 10 times more likely to buy music’, guardian.co.uk, 21 April 2009.

Companies that accept huge research costs – such as the pharmaceutical industries – need the surety of knowing that they will have some payback for that research. Without that there is little point in them undertaking the research in the first place and medical science will suffer.

It’s easy to say that manufacturing a pill only costs two cents – the reality is that a trial alone can cost upwards of $100m with the whole research and development per approved drug costing billions.[i] The framework

 for doing that is one that requires a profit for investors and security for researchers.

Allowing for generic medicines to undermine that end point profit discourages the necessary blue-sky thinking and ground-breaking research as they’re risky and may not see a financial return. As a result, those medicines that are proven ‘sellers’ need to make the profit for the long-term investment that will be required for cures for cancer, AIDS and other global killers. Stopping pharmaceutical companies from making a healthy profit on established antibiotics and similar medicines means that they then don’t have the financial muscle to be able to fund the long development and large amount of research necessary to create the drugs of the future. If they then believe those drugs will quickly be recreated and turned into generics they will give up researching entirely.

[i] Herper, Matthew, ‘The Truly Staggering Cost of Inventing New Drugs’, Forbes, 10 February 2012.

The reality is that antibiotics and similar medicines are mostly sold to Monopsonistic  governments and don’t represent the profit base of big Pharma. Instead they have focussed on products such as Prozac that are high-profit by their nature, while thirty-year old antibiotics are left to become ever less effective against evolving viruses.[i].

[i] Gouge, Deborah, ‘Big Pharma Abandons Antibiotics: An Opening For Small Biotech’, Seeking Alpha, 13 May 2012.

There is a genuine value to a brand – in part because, for clothing companies for example, it is a mark of quality as much as it is of origin. However even if that were not the case, the brand identity of a company is part of its legal property and should be protected in the same way and stock or cash against theft.

The very fact that people are so keen to buy branded clothing and other products – even when pirated – demonstrates that there is a value to those brands.

ACTA doesn’t seek to control people’s  rights to wear any pair of jeans or trainers or other type of product. It simply says that if someone wants to own Levi jeans or Nike trainers they should pay the price set by Levis or Nike. If they don’t want to pay the premium then they are at liberty to buy different unbranded products.

Were proposition’s case true then it would raise the question of why no consumers groups have been involved in the negotiations or representative of cloth and other manufacturers in the developing world – or for that matter the originators of design techniques more generally. The only people consulted were the stakeholders of extremely wealthy brands; mostly price-gougers with appalling records in terms of how they spend that money as it relates to the payment of workers or suppliers. This agreement serves purely for the protection of a wealthy few and against the interests of the overwhelming majority in the industries they represent.

This has been a secret stich-up between a handful of, mostly Western, governments and massive corporations or their representative trade organisations. It has notably failed to receive democratic support and poses a genuine threat to freedom and equality offered by the Internet. So far it has been signed by fewer than 40 nations and has failed to receive democratic approval[i] in any of them; it is the child of national and business elites but has failed at every hurdle where the public was watching hence it has not been ratified by any legislatures and in some cases such as in Mexico been thrown out almost unanimously.[ii][iii] Where it has been signed, it has mostly been met with protests from politicians and public alike. If the proponents of this measure are so sure of its virtues, the obvious solution would seem apparent; put it to a vote.

It proposes the creation of an international body with no democratic accountability[iv] at all as it just has representatives from each party to the treaty but no accountability to any other body and seeks to undermine public involvement in both formal and informal ways with the management of information in the modern world. Opposition to this agreement has been at least as ferocious as previous attempts to remove the democratic input of the inhabitants of the planet into decisions that affect their lives – such as the General Agreement on Trade in Services (GATS). The Agreement has run into issues of constitutionality in the EU, US and elsewhere with legislatures questioning whether national executives have the right – let alone the capacity – to implement the measures of the Agreement. Any government that attempted to ratify the agreement would be likely to face stiff opposition from both parliamentarians and the public – to date that has been insurmountable[v].

[i] Various articles from around the world

[ii] ‘Dictámenes a Discusión y Votación‘, Senado de la Republica LXI Legislatura, 22 June 2011.

[iii] Hernandez, Daniel, ‘Mexico signs anti-piracy treaty, setting up battle with activists’, Latimes blog, 13 July 2012.

[iv] Chapters four and five, Council of the European Union, ‘Anti Counterfeiting Trade Agreement’, 23 August 2011.

[v] Mason, Daniel, ‘European Opposition to ACTA grows’, Public Service Europe, 13 February 2012.

Government is about taking tough decisions rather than pandering to majoritarian whims. Legislation such as this protect industries in the creative, IT, manufacturing and medical sectors. The support it has garnered among trades union demonstrates that they, at least, recognise that it is about protecting jobs. It is no surprise that many people prefer to buy products that are cheap – or better, free – but government has a responsibility to protect the livelihoods of its citizens with rather more enthusiasm that the right to download free movies. It would be interesting to see where the democratic deficit goes when entire industries start collapsing because of counterfeiting. 

Many within the creative industries have developed business models that work with the Internet. A few giants – frequently not producing the most artistically acclaimed work – are simply trying to defend their monopolistic profits. The idea that any of the companies involved in these negotiations are serious about protecting creativity is undermined both by the products and their response to anything new or threatening to their corporate interests. Instead this is holding up the process of creative destruction, whereby new better ideas sweep away the old that will be outcompeted,[i] by standing in the way of this in the digital world ACTA is stifling both creativity and the economy. The opposition to this legislation has come from actual creatives – programmers, artists, performers and others as well as researchers academics and more. It is being promoted by the very commercial interests that also seek to suck the life-blood out of genuine art, research and ingenuity[ii].

This is all about protecting the commercial interest of those corporations that have ceased to have much to do with any of these processes and simply want to make the most out of what they already control through copyright. It is and remains profoundly anti-competitive and a retrograde step in terms of developing any artistic, scientific or intellectual field. By securing, through copyright, established technologies, paradigms, and industries, the agreement undermines the very competition that so many of its proponents claim to endorse. Indeed the only thing it can be demonstrated to do is to allow organisations to steal widely held information by slapping a copyright or brand on it.

[i] Cox, W. Michael and Alm, Richard, ‘Creative Destruction’, The Concise Encyclopedia of Economics, 2008.

[ii] Creative Freedom Federation, New Zealand.

The major corporations, which seem to exercise the opposition so greatly, are also major employers and major investors. In addition to which counterfeiting is a much greater threat to small corporations that are dependent on one good idea and lack the financial muscle to protect that idea, for example Ifttt, an internet startup was cloned by a Chinese company, Linggan, while it was still in beta.[i] The people that have something to fear from this agreement are those with no ideas seeking to skim a profit off the energy and effort of others[ii].

Importantly protecting intellectual property rights can also encourage innovation, by ensuring that start-ups keep creating new ideas and are sure they can profit from them. We need to ensure that there are sufficient incentives for entrepreneurs, of which intellectual property is one important component.

[i] Sam, ‘Speedy Chinese Clone Copies Startup Still in Beta’, TechinAsia, 23 August 2011.

[ii] A list of supporters

ACTA represents a fundamental attack on the right to produce or host free software. It is written in such a way as would protect the rights of corporations such as Microsoft to build systems that require updating while, at the same time undermining freeware software such as Linux. Its provisions that can both punish (art 12:1) and pass enforcement over to ISPs (art 8:1) who therefore have an incentive to restrict free software. Article 27:6 specifically attacks computer programs that are providing a free alternative and those that may affect digital rights management programs.[i][ii] In doing this it creates a culture of surveillance and represents a fundamental attack on freedom of expression and basic principles of democracy as it would commercialise the right to access and distribute information.

The rights to free expression are recognised in virtually every codification of basic human rights – on which this agreement is mostly silent. It will make impossible the free distribution of programmes and other computer tools and re-asserts, as did GATS, the primacy of corporations through a right to protect things that they didn’t think of but wished they had.

Already they have the advantages of massive budgets and huge legal departments, this agreement simply distorts the playing field still further in their interest.

[i] ‘Speak out against ACTA’, Free Software Foundation, 19 June 2008.

[ii] ‘ACTA: threats to Free Software’, hugo’s blog, 21 April 2010.

The EU[i] has described this agreement as a balance of the interests of all stakeholders – including customers or other users. Nobody is banned from freely sharing their own ideas, inventions or research; merely from ripping off that of other people. The oppositions need not worry about the articles it mentions as they are targeted not at individuals but at other commercial outfits.

What is described as privatizing data is in fact increasing functionality and ensuring interoperability. Ask anyone who uses an Apple device or have become accustomed to using Microsoft Outlook and they will testify that their products work best when used together with other similar products. By allowing other organisations to copy these services you are only harming consumers.

[i] European Commission, ‘ACTA – Anti-counterfeiting Trade Agreement’, 4 July 2012.