WASHINGTON - The National Research Council (NRC) today recognized that copyright theft has had a serious impact on the creative industries and urged new research to further document the effect on our nation's economic and creative growth.
The 85-page report by the NRC, which is a branch of the National Academies, titled "Copyright in the Digital Era - Building Evidence of Policy," explored four key research topics that impact film, music, book publishing and scientific publication: incentives to create, voluntary licensing transactions, enforcement challenges and striking the right balance between copyright protection, and exceptions and limitations. It acknowledged that copyright enforcement is a major area that warrants research due to, amongst other things, the lack of enforcement mechanisms outside of the United States.
In a section on film and piracy, the report highlighted the negative effect of illegal distribution services on legitimate markets, noting that "the persistence of Bittorrent file-sharing platforms and ad-supported cyberlockers continue to have a significant destabilizing effect on th[e] market" for "Blu-ray, DVD, and cloud services such as Ultraviolet, and authorized online services [that]... provide a promising opportunity for motion picture distributors to offer consumers the ability to access movies on the platform of their choice, but also for independent and niche filmmakers lacking access to theatrical distribution to reach a broader audience."
The report continued: "Although copyright law and other remedies under the DMCA remain an effective tool against infringing services located in the United States, most, if not all illegal services have moved off shore to territories that lack effective enforcement mechanisms making it nearly impossible to slow the proliferation of infringing download and streaming services. While the motion picture industry has embraced more distribution channels than ever before, the greatest threat facing the industry is the illegal distribution of movies while still in theaters. This has had the greatest impact on independent filmmakers that have struggled to achieve financial success and reliable financing."
The following is a comment by Michael O'Leary, the MPAA's Senior Executive Vice President for Global Policy and External Affairs: "We appreciate the hard work and dedication of the research committee, which included Mitch Singer, Chief Digital Strategy Officer, Executive Vice President, New Media and Technology, Sony Entertainment, Inc. As the committee noted, ‘the ease of infringing digital copying and distribution often weakens sales and reduces the revenue available to creators.' A major challenge to all of us is to identify potential avenues of solution, including the creative content and technology industries working more closely together to help ensure an Internet that works for everyone."
O'Leary agreed with the importance of robust research and noted that two recent studies involving researchers at Carnegie Mellon University and their colleagues have focused specifically on some of the issues discussed in the report.
In one, "Gone in 60 Seconds: The Impact of the Megaupload Shutdown on Movie Sales" researchers found that the Megaupload shutdown caused a 6-10% increase in digital movie revenues across 12 countries for 18 weeks as a result of the shutdown. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2229349
In the other, "Assessing the Academic Literature Regarding the Impact of Media Piracy on Sales," like the current NAS study, researchers found the vast majority of the literature - particularly the literature published in top peer reviewed journals - finds that piracy harms media sales. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2132153