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February 2012

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Why Megaupload Case Puts SMB Advertisers At Risk

by Glen Emerson Morris
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The indefinite shelving of the SOPA and PIPA bills were welcome news to SMB advertisers. From a business point of view the average SMB needs the Internet, Google and Yahoo a great deal more than they need their local movie theater, Warner Brothers and Capitol Records. However, this will certainly not be that last attempt to redefine basic rights on the Internet to fit the business model of a well funded special interest group.

Even without SOPA, the US government had no problems taking Megaupload's domain offline, confiscating the assets of the company, and putting the senior staff in jail. What SOPA attempted to do was to eliminate any due process for the accused while eliminating any accountability for those authorized, or required, to enforce it. It also lowered the bar considerably for what actually constituted copyright infringement. These bills, and those that will likely follow, will make it far more likely that innocent businesses will be caught up in copyright infringement cases one way or another.

One of the biggest problems with the Megaupload case is that large file sharing sites like Megaupload are used by any legitimate businesses, individuals and non-profit organizations. Many of these larger domains sell online storage and website hosting to cloud services, who resell to SMBs who will have no idea where their data and Website are being hosted.

Under current and proposed legislation, the government is under no obligations to return confiscated files of innocent businesses and individuals. In fact there's nothing to prevent the government from using or selling that information as they see fit.

No one can argue that file sharing Websites should be allowed to host or stream copyright protected content without proper licensing. However, it can be argued that businesses and individuals have as much right to their files as Hollywood has to its movies. At the very least, the government should be required to make a reasonable attempt to return legally owned files to their rightful owners.

After hearing about the Megaupload domain seizure, some of the other file sharing sites immediately implemented a policy of restricting downloads only to the person who had posted them. This could have easily been done by the government with Megaupload, but it wasn't. Business and individual users should have been given time to to retrieve what after all was their information. Instead, the government choose to disregard the rights of all but those who were making the largest contributions to Congress.

An even greater danger for SMB advertisers is the disregard for the actual technology of the Internet in bills like SOPA and PIPA. One of the bill's required a search engine to return a blank field instead of the requested information, which was technically impossible given the architecture of the Internet. It was the kind of thing Dilbert's boss would specify. Doomed from the start.

In real life, Dilbert was an optimist. It would not be surprising to wake up some morning and find Congress had rushed through some bill to protect some special interest group that basically made e-commerce impossible as we know it. In the 1990's legislation was nearly passed that would have limited the level of encryption used on the Internet to well below the security level required for e-commerce.

Then, as with the case of SOPA and PIPA, enough people rallied to support freedom that the government lost. The government was quite correct in asserting that America would be more secure if the public was prohibited from using decent encryption. However, secure is not the same thing as prosperous, or happy. A prisoner is solitary confinement is secure. The public understood this and was quite correct in saying they wouldn't accept the government's position, and they didn't. If enough people hadn't pressured Congress then, we wouldn't have e-commerce as we know it now.

Keeping the Internet free enough for e-commerce and a democratic political process will be a never ending battle. It will take a lot of effort by a lot of people. Fortunately, enough people are willing to make the effort.

When SOPA and PIPA where initially proposed, Washington pundits and politicians alike predicted both bills would pass by a wide majority, especially given the speed the bills cycled through Washington. For some reason it didn't occur to them that if you threaten Websites that millions of Americans use hourly, within hours, millions of people will know their favorite sites are being threatened.

The recent showdown between Hollywood and Silicon Valley proves that sometimes what should be more than enough money spent on politicians can still be not enough to get a law passed. This is not likely to be an isolated case, not this year. With the public's confidence in Washington at a historic low, and super-pacs pouring millions into the campaign, the 2012 elections are becoming less a credibility issue, than something faar more problematic. Many Americans are now questioning the very legitimacy of our government. To them the 2012 elections will be about enforcing corporate accountability, and restoring rule of law.

Exactly what the public is going to do between now and the end of the 2012 campaign is still anybody's guess, but there's little doubt that this is going to be an election like few in American history. This may be the last election it's possible to restore a balance of power between corporate interests and public interests. The outcome matters to SMBs because, ultimately, the average SMB isn't going to fare much better than the average person. Getting through this year is going to take some effort.

Though the defeat of SOPA was welcome news, on the whole 2012 did not get off to a good start for advertisers. Sadly, we have to report that Congress and the Department of Commerce have cratered to special interests and ceased production of the entire compendia series of publications, including The Statistical Abstract of the United States, in publication since 1878. We will be covering this more in detail as time permits. In the meantime, write your Congressman and demand that publication of the Statistical Abstract be resumed immediately.


Glen Emerson Morris was a senior QA Consultant for SAP working on a new product to help automate compliance with the Sarbanes-Oxley law, an attempt to make large corporations at least somewhat accountable to stockholders and the law. He has worked as a technology consultant for Yahoo!, Ariba, WebMD, Inktomi, Adobe, Apple and Radius.




Copyright 1994 - 2011 by Glen Emerson Morris All Rights Reserved ' keywords: Internet advertising, Internet marketing, business, advertising, Internet, marketing. For more advertising and marketing help, news, resources and information visit our Home Page.


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