French Appear Ready to Soften Law on Media Piracy

http://www.nytimes.com/2013/06/03/technology/03iht-piracy03.html

Version 0 of 1.

SERRAVAL, France — A French experiment in cracking down on digital media piracy by threatening to kick copyright cheats offline is about to end — without solving the problem.

In 2009, French lawmakers, aiming to curb unauthorized file-sharing and to slow the erosion of media industry revenue, approved what was billed as the toughest anti-piracy law in the world. Repeat offenders who ignored two warnings to quit downloading movies or music illegally were confronted with the prospect of a suspension of their Internet connection. The system was emulated in several other countries, including the United States, though generally with softer penalties.

But now the government of President François Hollande appears poised to shut down the agency that was created to enforce the law, imposed under Mr. Hollande’s predecessor, Nicolas Sarkozy, and to defang the measure of much of its menace.

Fleur Pellerin, the French minister in charge of Internet policy, said during a recent visit to a high-technology complex in Sweden that suspending Internet connections was incompatible with the French government’s hopes of spurring growth in the digital economy.

“Today, it’s not possible to cut off Internet access,” she said. “It’s something like cutting off water.”

A report on digital policy that was prepared for the government by Pierre Lescure, the former president of the pay-television company Canal Plus, in April recommended dropping the threat of disconnections and replacing it with a fine of €60, or $78, for repeat offenders. The report also recommended disbanding the enforcement agency, known by its French acronym, Hadopi, and subsuming some of its functions in the French media regulator, Conseil supérieur de l’ audiovisuel.

While government ministers have voiced support for Mr. Lescure’s recommendations, some lawmakers, including Patrick Bloche, an influential Socialist deputy, have suggested that the administration should go further and simply scrap the entire system of warnings and potential penalties.

Despite all the debate that the system has prompted, in and outside France, evidence of its effects remains skimpy. A study by researchers at Wellesley College near Boston and Carnegie Mellon University in Pittsburgh that was published last year showed that the threat of disconnection was directing more French Internet users toward Apple’s iTunes store, a licensed source of digital music. Separate studies, commissioned by Hadopi, have shown a decline in illegal file sharing.

Yet the French music business remains deeply troubled. SNEP, a French recording company group, said Friday that industry revenue fell by 6.7 percent in the first quarter of the year. More alarmingly, revenue from digital outlets fell by 5.2 percent — the first quarterly decline — though the organization said several special factors played a role in this.

Meanwhile, SNEP said the number of visits to illegal music sites by French Internet users had risen by 7 percent between January 2010 and January 2013, to 10.7 million.

Guillaume Leblanc, director general of SNEP, said the group was willing to accept dropping the threat of disconnection, as long as the warning system was preserved, but said the proposed €60 fine was too low.

“Maintaining graduated response is essential for the music industry,” he said. “For the legal offer to keep developing, it’s important to have strong copyright protection on the Internet.”

While Hadopi has sent out hundreds of thousands of warnings to those suspected of being pirates, only a handful of cases have reached the third and supposedly final stage. Several of these were thrown out by the courts; others resulted in fines or suspended sentences.

“If you cannot chop off a few heads as an example, then the chopping machine inspires less fear,” said Jérémie Zimmermann, spokesman for La Quadrature du Net, a group that has campaigned against the law.

Supporters of the law say cutting off large numbers of Internet connections was never the point.

“From our standpoint this was always meant to be an educational and deterrent measure,” said Frances Moore, chief executive of the International Federation of the Phonographic Industry, a trade group.

The Lescure report recommends that the downgraded penalty — a fine rather than disconnection — be accompanied by greater certainty that it would be applied, through the adoption of an administrative court procedure, like the one used for minor traffic violations.

A downgrade of the French system would leave South Korea, which also imposed a similar system in 2009, as the country with perhaps the toughest anti-piracy measures in place. More than 400 Internet accounts or Web sites have been suspended in South Korea since the law went into effect.

Recording industry revenue in South Korea rose by 26 percent from 2008 through 2012, a period in which sales worldwide fell by 14 percent, according to the international recording industry federation.

Whether the law is responsible for the gains is debatable; the surge has coincided with the K-Pop phenomenon, in which South Korean acts like Psy and his “Gangnam Style” have taken the world by storm.

The law is unpopular with free-speech groups, which are campaigning for a repeal.

In March, the Korean National Human Rights Commission recommended that the measure should be reviewed to determine whether it clashes with constitutional protections.

Elsewhere, countries that have adopted systems involving warnings and penalties, also known as graduated response, have tended to opt for less draconian measures than France or South Korea, sometimes involving private-sector deals rather than legislation.

In the United States, for example, five major Internet providers recently agreed to put in place a so-called copyright alert system, negotiated with the entertainment industry. Sanctions, which can include a temporary slowdown in Internet access speed, do not kick in until an account holder ignores at least five warnings.

Analysts say that the backtracking by the French could lessen legislators’ enthusiasm for graduated response systems in other countries, at least if they involve the threat of disconnection.

“Looking at this politically, if one of the few countries where they were able to get the political support to pass this — if they get rid of it, it could make it harder to do graduated response elsewhere,” said Brett Danaher, a professor at Wellesley College who worked on the study examining the effects of Hadopi on iTunes sales.

He and others said the entertainment industry and policy makers might now turn more of its attention to efforts to block Web sites that host content that infringes on copyright, rather than going after individual Internet users.

Ms. Moore said neither strategy would provide an easy solution.

“We have to take a holistic approach,” she said. “Web site blocking and alert systems are just two tools.”