A dying creative industry

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The technology landscape is evolving so quickly that governments are struggling to implement effective laws to protect their constituents, while agencies are working to develop timely and reasonable regulations.

An article in Bloomberg Law notes that at any given time, dozens of technology and communications-related bills are at various stages in Congress. Meanwhile, new applications, devices, and software are being developed every day.

Take the case of our very own intellectual property laws.

The last time the Intellectual Property Code of the Philippines was amended was in 2013, when online copyright infringement, or digital piracy, of literary and artistic works was still very much unheard of.

Last September, House Bill 4773 was introduced by House Rep. Maximo Dalog, which seeks to amend specific provisions of the IPC to address its limitations in addressing online infringement.

It emphasized that the evolution of information technology from hardware, software, network and connectivity, cybersecurity and the more recent artificial intelligence and automation is constant. With these rapid developments, legal protection for intellectual property needs to adapt continuously and stay up to date.

It noted that the current IPC is wanting in its enforcement against modern online infringements. According to the Intellectual Property Office of the Philippines (IPOPHL), in 2022 alone, $781 million in revenue, excluding taxes, was lost due to downloads from illegal sites. And if this is not addressed, losses will balloon to $1 billion by 2027.

One way to address the ever-evolving forms of online infringement is to implement agile administrative remedies, such as expanding IPOPHL’s power to block infringing websites or those that facilitate copyright infringement and the like, to halt the substantial losses caused by online infringement and protect the creative industry.

This, of course, is not a problem unique to the Philippines.

SG Analytics revealed that illegal streaming and downloading of content due to online piracy cost the US economy at least $29 billion in lost revenue each year. The Indian entertainment industry suffers annual losses of nearly $2.8 billion due to digital piracy. Meanwhile, digital piracy on social media and other communication platforms poses even more challenges for over-the-top content creators, it added.

It noted that in the early days, pirated movies were consumed through CDs and DVDs. But with widespread access to the web, there has been a stark rise in the consumption of pirated content online. This menace, it emphasized, has significantly affected many creator economies, including music, gaming and sports. Streaming, in fact, now accounts for almost 80 percent of pirated content in the entertainment industry. And the demand and market share for pirated content were amplified by COVID-19, with film piracy rising by nearly 62 percent during the pandemic as many people globally were confined to their homes.

The articles cited several reasons for this rise in digital piracy, including easy access to cheap or free content that appears lucrative to many. Likewise, the advent of new technologies has made pirated content readily available to all consumers, even those whose geographic locations often restrict their access to it, the article added.

It pointed out that this impact on the creative industry has not only disrupted original creations and affected their livelihoods, but that rampant counterfeiting has also led to a cut in revenues and employment in the television and film industry. It also noted that while advertising and subscription-based OTT platforms face revenue losses, they also lose viewers and subscribers to illegal platforms that pirate their content and make it available to viewers for free.

According to the IPOPHL, citing a Media Partners Asia study, 20 million Filipinos downloaded from illegal sites in 2022, resulting in a loss of $781 million. The agency warned that if nothing is done, by 2027, the number of illicit users will increase to 31 million and the leakage will be $1 billion, excluding losses from foregone tax revenues.

Meanwhile, according to a YouGov 2022 Piracy Landscape Survey, the Philippines ranked second in Asia-Pacific for consumption of pirated content, next only to Vietnam.

The American Chamber of Commerce of the Philippines noted that legitimate filmmakers and creative and content producers lose money due to piracy and are forced to produce low-budget products and services, as they expect reduced revenues from this negative consumer behavior. It added that even investors are becoming increasingly reluctant to fund Philippine content production.

To prevent online copyright infringement, the proposed bill will give the IPO the power, after due notice and hearing, to restrict access to an online location and prevent further access to an online location whose primary purpose or effect is to infringe copyright or facilitate copyright infringement. The copyright owner or exclusive licensee of the copyright may submit an application to the IPO for the issuance of an order disabling access to any infringing online location identified in the application. An online location refers to a single or related web page accessible by a user through a domain, IP address, or URL, which serves to run an application on the internet.

The creative industry is facing imminent demise unless adequate measures are put in place to stop online piracy. Illegitimate sources of content not only impact the creative industries significantly but also threaten consumers’ online safety. A site-blocking legislation is definitely one way to curb this illegal practice.

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