The Staggering Cost of Copyright Theft

Nearly 170 years ago, in Democracy in America, the Frenchman Alexis de Tocqueville wrote, “The sovereignty of the people and the liberty of the press may be looked on as correlative institutions.” Put more simply: You can't have a free people without a free press. And, as Thomas Jefferson pointed out, you can't have a free people without having an informed people.

That is why, as a news organization, we are alarmed at the flood of subpoenas that government at all levels is serving on journalists, including some of our own. If the current legal climate has a chilling effect on newsgathering, the consequences are serious—and could not come at a worse time.

There is another part of the Constitution that applies to creative expression, along with the First Amendment: It is Article 1, Section 8—the Copyright Clause—which authorizes Congress to grant to “authors and inventors the exclusive right to their respective writings and discoveries.” Congress has consistently enforced this for more than 200 years.

It has survived the high-speed printing press, the telegraph, the video recorder, and even the invention of xerography, which represents the ultimate test of Congress's will to apply the full measure of copyright laws. Think about it: It's a machine called … the copier. And copyright law survived.

Today, this constitutional protection is under enormous pressure and requires our vigilant attention.

At NBC Universal, we are eager to roll out new digital, on-demand services. We would like nothing more than to make accessing video as easy as Apple's iPod has made accessing music. But the experience of the recording industry—decimated by illegal downloads—teaches an important lesson: If the technology isn't managed properly, it has the power to do a lot of damage, by facilitating theft, not commerce.

The costs of not getting this right are huge. Copyright industries such as television, motion pictures, publishing, and software, whose capital is almost entirely composed of intellectual property, constitute the nation's largest source of exports, and 6% of our gross national product. If you include economic sectors that support these industries or are dependent on them, the figure doubles to 12% of GDP, or $1.25 trillion, with employment of more than 11 million Americans.

Already, the economic costs of intellectual property theft are staggering— $250 billion a year. That's more than the combined global revenues of the nation's top 25 media companies.

We hear repeatedly that intellectual property violations are a fair price to pay for the advent of a new digital age. And that technological progress demands a downgrading of the rights of creators, and a legal weakening of copyrights and patents.

It is a mistake to think that entering this world means embracing theft. The power of technology drives its success, not the theft of protected content. The challenge of protecting intellectual property belongs to the core of U.S. industries and export businesses, Had industrial America, or a military contractor, been at the front line of this issue instead of music, IP theft would be seen as a clear violation, and Congress would be quick to take action. Today, all data and information is easily replicable. Anyone who has information or an idea to transmit has a stake. Our challenge is to create rules of the road for a digital world that encourage technological progress yet uphold the values that make commerce possible.