OPENING STATEMENT OF REP. ZOE LOFGREN

LEGISLATIVE HEARING ON H.R. 2517

THE “PIRACY DETERRENCE AND EDUCATION ACT OF 2003”

Subcommittee on Courts, the Internet, and Intellectual Property

Thursday, July 17, 2003

We are here once again to discuss ways to deter and punish Internet piracy. Online piracy is indeed a threat to America’s copyright owners, and I’m glad that this Congress is taking the issue seriously.

But I am becoming increasingly dismayed by the fact that this Subcommittee only examines digital issues from one perspective. We have had numerous hearings this year on how online piracy affects content owners. Today, we are having yet another one, with four witnesses who seemingly support the bill we are considering. Among them, we have a witness from Universal Studios, who will no doubt tell us of the devastating effect that online piracy is having on movie studios. But according to statistics I’ve seen, yearly domestic box office gross has increased every year since 1992, including an 8.6% increase last year to over $9 billion dollars.

If you want to see an industry in turmoil, don’t look to the movie industry, look to the technology industry. Unemployment in Silicon Valley is now 8.5%. One-third of households in Silicon Valley have experienced a layoff since January 2001. Consumer confidence and investment are down. It is not a recession in the tech world, it is a depression.

I do not make this point to downplay the piracy issue, nor to suggest that the content industry is not suffering from online piracy. My point is that this Subcommittee should examine digital issues from all sides, not focus solely on how they affect copyright owners. We should look at how our laws affect the technology industry. We should examine whether or not the DMCA is chilling investment and innovation.

My bill, H.R. 1066, the BALANCE Act, which is supported by my Judiciary colleagues Rick Boucher and Chris Cannon, seeks to address some of these issues. I hope this Subcommittee will hold a hearing on this legislation soon, or at the very least look at how laws under our jurisdiction affect the technology industry, as well as Hollywood.