Illegal Video Streaming Elevated to Felony Under Senate Bill

The U.S. Senate Judiciary Committee approved a measure today that would make illegal streaming of video over the Internet a felony offense in some cases, sending the proposed legislation to the full Senate.

The bill, S. 978, would make illegal video streaming for commercial purposes a felony punishable by as much as five years in prison if it involves 10 or more instances of streaming copyrighted works over a 180-day period. The retail value of the video must exceed $2,500, or the licenses to the material must be worth more than $5,000.

The bill was introduced May 12 by Senators Amy Klobuchar, a Minnesota Democrat, John Cornyn, a Texas Republican, and Christopher Coons, a Delaware Democrat.

“This isn’t about individuals or families streaming movies at home,” Klobuchar said in an e-mail after today’s vote. “It’s about criminals streaming thousands of dollars worth of stolen digital content and profiting from it.”

The Obama administration supported making illegal video streaming a felony “in appropriate circumstances” in a set of recommendations released March 15 for fighting the illegal sale of pirated products and content.

Maria Pallante, director of the U.S. Copyright Office, also backed making illegal streaming a felony in a June 1 House Judiciary subcommittee hearing, saying that treating the offense as a misdemeanor gives prosecutors little incentive to file charges in such cases.

$75 Billion Cost

Piracy of digital movies, music and software cost businesses from $30 billion to $75 billion in 2008 in the Group of 20 leading global economies, according to a February report commissioned by the International Chamber of Commerce from Frontier Economics, a London-based consulting firm.

The Copyright Alliance, a Washington-based group whose members including Comcast Corp. (CMCSA)’s NBC Universal, Time Warner Inc. (TWX) and Viacom Inc., said it “applauds” the Senate Judiciary Committee’s vote on the illegal streaming bill.

“The distribution of other people’s work without their permission should be punished the same way under the law regardless of the technology used,” Sandra Aistars, executive director of the Copyright Alliance, said in an e-mail.

The Electronic Frontier Foundation, a San Francisco-based digital-rights group, is concerned that the measure may constrain free speech, Abigail Phillips, a senior staff attorney for the organization, said in an interview today.

“The more serious the potential penalties, the greater deterrent effect on innovation and speech activity online,” Phillips said.

She said it’s unclear whether the legislation would apply to websites accused of offering illegal video, people who upload illegal video to such sites, or people who “press play” to watch such videos online.

To contact the reporter on this story: Eric Engleman in Washington at eengleman1@bloomberg.net

To contact the editor responsible for this story: Allan Holmes at aholmes25@bloomberg.net

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