Stop Online Piracy Act's Impact on Silicon Valley, You

Google, Facebook, Twitter and others oppose conterversial Internet piracy bill, but should you?

With one move, the House Judiciary Committee put on hold a conclusion to a debate that some say could change the way we use the Internet.

Members of the committee will vote on the Stop Online Piracy Act, better known as SOPA, when Congress reconvenes in 2012.

A vote on the controversial measure that would allow copyright holders to seek legal action against websites accused of enabling the distribution of copyrighted material.

The proposed bill could go as far as requiring Internet search engines or credit card processing sites to block access to sites that stream or show copyrighted material and it would make the unauthorized streaming of copyrighted material a felony.

Several of Silicon Valley's biggest hitters have lined up in opposition to the bill. From Google to Twitter to Facebook have all publicly voiced their concerns about the bill and some of them formed an organization to fight SOPA called NetCoalition.

Some of the founders of PayPal, Yahoo, eBay and Netscape even took out full page ads in The New York Times to voice their opposition of the measure.

"Unfortunately, the bills as drafted would expose law-abiding US internet and technology companies to new uncertain liabilities, private rights of action, and technology mandates that would require monitoring of websites," companies such as Google, Zynga, Mozilla, LinkedIn, Yahoo, Facebook and Twitter wrote in a letter to the House of Representatives and Senate Judiciary committee.

But on the other side, content providing companies such as NBC -- this website's parent company -- say the bill is meant to protect their business and in turn save jobs, which are at a premium in this struggling economy.

NBC was joined by 350 other companies in September that sent a letter to Congress expressing their public support of the measure.

"A study examined approximately 100 rogue sites and found that these sites attracted more than 53 billion visits per year, which average out to approximately nine visits for every man, woman, and child on Earth," the companies wrote in their letter to Congress, which you can read here (PDF). "Global sales of counterfeit goods via the Internet from illegitimate retailers reached $135 billion in 2010. The theft of American IP is the theft of American jobs."

However, for several companies in the valley the bill goes too far and is in fact a violation of civil liberties since companies, such as Google, would be required to monitor what its users are searching or an ISP provider like Comcast would be required to block its users from navigating to certain sites.

The depth of the bill has pushed Google chairman Eric Schmidt to call the measure "draconian," while others have equated it to China level censorship of the Internet.

But some in Congress allege that Google and others oppose the bill because they actually make money off of Internet piracy.

Young entrepreneurs worry about the bill possibly stunting intellectual and technological advancement in the country.

Alexis Ohanian, co-founder of news-aggregating website, said his company never would have been able to be launch had SOPA been the law when started.

He said he worries that the next great big idea will never come to fruition because of SOPA restrictions.

Ohanian recently hosted a telethon to encourage Americans to call their Congressional constituents and voice their opposition to SOPA.

The Motion Picture Association of America strongly disagrees with Ohanian and his supporters.

The movie-making community said the U.S. Department of Justice would be given powers by SOPA that would not only protect art in America it would encourage others to create their own art because they know it is protected.

Others worry that open source projects would be killed by SOPA and that it would lead to domain blocking, which could lead to a loss in jobs anyway.

"It would cover IP blocking. I think it contemplates deep packet inspection" said Markham C. Erikson, head of NetCoalition, recently said.

But Cary Sherman, the head of the Recording Industry Association of America, countered in a recent op-ed that the bill would focus on only blocking violating IPs and not entire domains or servers by denying "access to only the illegal part of the site."

The ultimate bottom line for hardliners on both sides comes down to dollars. Those who argue that SOPA will save money for companies that invest heavily in America's economy and others who argue the opposite.

The one point that can't be debated is the Internet's impact on the United States annual GDP. President Barack Obama cited a recent report (PDF) that said the Internet adds approximately $2 trillion to the country's annual GDP and the IDC has predicted that will add up to 7.1 million new jobs and 100,000 new businesses created in the next four years because of the tech sector.

The debate is certain to continue at least through the holiday season.

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