The Big Story: 10 years later, SOPA has lessons for startup policy
This week, we’re reflecting on copyright policy’s past as well as the impact it will continue to have on innovation, and what that all means for high-tech, high-growth startups and the Internet users and creators that depend on them. Engine, alongside many organizations, remembered and commemorated the 10 year anniversary of the defeat of the Stop Online Piracy Act (SOPA) with conversations of what balanced, innovation-friendly copyright policy looks like for startups and small businesses. At 12 pm ET today, we are hosting a conversation with startup founders about the work they are doing and how it would change or suffer if copyright and other intermediary liability frameworks shifted today. Learn more and RSVP for the webinar here.
Ten years ago, on January 18, 2012, millions of people across the U.S. participated in the largest online protest in history, as tens of thousands of websites went dark to oppose SOPA. That deeply-flawed legislative proposal would have allowed rightsholders and law enforcement to cut websites off from key Internet services like payment processors and advertising networks—and even push those websites offline entirely—over mere allegations of infringement. While the protest stopped SOPA and its Senate companion at the time, misguided and imbalanced copyright proposals continue to percolate around D.C.—proposals that would cut against copyright’s underlying goal of promoting progress and instead stifle startups and small businesses who rely on digital spaces for their work.
As we explained in a new blog post, startups still need balanced, certain copyright frameworks, and they need well-tailored laws that focus on enforcing legitimate rights without allowing overreach that stands in the way of innovation. In today’s policy conversations, this means things like elevating fair use and ensuring weak copyright claims cannot defeat interoperability, preserving balanced intermediary liability laws for startups that encounter user-generated content, and making sure copyright law doesn’t change in ways that substantially hamper AI development. Join us at noon ET today to hear more.
Policy Roundup:
Senate committee advances antitrust bill. On Thursday, the Senate Judiciary Committee voted 16-6 to advance the American Innovation and Choice Online Act. The bill, sponsored by antitrust subcommittee Chair Klobuchar (D-Minn.), is intended to restrict the conduct of a few large tech companies, but, as several senators on both sides of the aisle expressed in the markup, could have more expansive harmful consequences for the companies’ consumers—including startups and small businesses. Some of those senators voted it out of committee but said those concerns would need to be addressed to earn their support on the floor.
U.S.-EU data transfers in limbo without transatlantic deal. Legal challenges across Europe are continuing to create uncertainty for companies that store and process data about EU users in the U.S. Previously, companies could conduct transatlantic data transfers under Privacy Shield, an agreement that was especially important for startups that don’t have the resources to easily create alternative legal arrangements. In July 2020, the EU’s highest court struck down that agreement, citing concerns about U.S. government surveillance. Since then, local regulators in Europe have begun bringing cases against companies for transferring data to the U.S., including a case against a small Austrian medical news website that used Google Analytics.
FTC launched new merger guidelines. This week, the Federal Trade Commission (FTC) and the Department of Justice’s (DOJ) antitrust division launched a joint effort to rewrite merger guidelines. The effort comes after President Biden’s executive order on competition in June and the FTC rescinding earlier guidance on vertical mergers in September. As we’ve stated in the past, acquisitions are a critical part of the startup ecosystem. They enable the flow of capital, promote investment in startups and provide opportunities for a successful exit. Both agencies are currently requesting public comment as they shape the new guidelines.
Trouble in EU for global tax deal. The historic global tax reform plan set into motion last October faces headwinds after three European countries—Estonia, Hungary, and Poland—have protested its implementation, citing fears that the U.S. might not follow through on implementation. The global tax deal would establish a global minimum tax and prevent digital services taxes that threaten to lead to increased costs for startups. Policymakers around the globe must implement the deal they have agreed to and avoid discriminatory DSTs.
House panel explores Indo-Pacific digital trade. A House Foreign Affairs subcommittee held a hearing this week probing the importance of digital trade in the Indo-Pacific region. Witnesses and representatives from both sides of the aisle called for a digital trade agreement to help shape digital trade rules in the region. The Biden Administration is working on an “Indo-Pacific economic framework,” and Engine continues to call for their leadership in creating digital trade rules that lower barriers and open markets for startups.
Startup Roundup:
#StartupsEverywhere: Ada, Michigan. Civil is a virtual resource library that provides educators with vetted, researched, and summarized political topics and lesson plans that help safely foster discussion around current events in the classroom. We spoke with Founder and CEO Max Tendero about what experiences led him to create Civil, how potential changes to current copyright regulations could present challenges to startups like his, and why alterations to current Internet frameworks could impact Civil’s growth in the future.
