With the "Copyright Alert System" going into operation over the next few months, major American ISPs will start sending out "strikes" to users accused of infringing copyrights online. Sean Flaim, who has just completed extensive research on the topic, argues that the system has real benefits—but it needs close supervision. The opinions expressed here do not necessarily represent those of Ars Technica.

Eight months ago, content owners and Internet service providers (ISPs) agreed to the Copyright Alert System, a "six-strike" plan to reduce copyright infringement by Internet users. Under the system, ISPs will soon send educational alerts, hijack browsers, and perhaps even slow/temporarily block the Internet service of users accused of online infringement (as identified by content owners). At the time it was announced, some speculated that the proposed system might not be legal under the antitrust laws. Were they right?

Recently, I completed a draft research paper where I explored the potential antitrust aspects of "six strikes" even further. There, I concluded that while the system has some promise for reducing online infringement, its private nature, combined with a lack of government oversight, raises significant antitrust concerns. It will require careful monitoring by regulators.

Power plays

Just what is antitrust law? If I had to explain antitrust in a single word, it would not be "competition"—it would be "power." The power to raise prices above a competitive level; the power to punish people who break your rules. Such power is something society usually vests in government. Antitrust law is in part concerned with private industry attempting to assert government-like power.

In a democratic society, people can exert some control over government power at the ballot box. Private power cannot be controlled with the same sort of vote. Rather, private power only responds to consumer choice in the marketplace. When the marketplace fails to function correctly and lacks competitive pressure, nothing keeps companies from exerting private power in ways that benefit them. This hurts consumers overall.

The Copyright Alert System represents a raw exercise of concerted private power. Content owners as a group have control over their product. They have leveraged this control to forge this agreement with ISPs, who need to work with content owners in order to offer content to their own users. ISPs, in turn, have power over us as users. When was the last time you looked into alternatives to your home Internet service? If you are like people in 75 percent of this country, only one truly high-speed broadband alternative will soon be available—your local cable television company. In most locations, that company has agreed to participate in the Copyright Alert System.

Given that Internet companies have the power to determine how—and whether—consumers can access the Internet, this makes the Copyright Alert System even more problematic. The proposed system flips copyright on its head. In a normal copyright infringement claim, the copyright owner must first identify the alleged infringer and then sue them in court. Once there, the owner must prove that the alleged infringer downloaded, shared, or publicly performed a work without authorization.

Not so in the Copyright Alert System. If a consumer gets to the point where an ISP is going to take an action, the consumer is given the option of participating in a private "due process" proceeding, provided they have $35 to spare. In the proceeding, the content owner is presumed to have both identified the copyrighted work correctly and correctly identified the alleged infringer. The burden of proof is on the consumer to prove them wrong. And the alleged infringer is even limited in the ways they can attempt to do that. In essence, the Copyright Alert System is an effort to privately rewrite copyright law to make an accused liable for infringement until proven innocent.

What justifications do companies offer for taking these actions? For one, the companies assert the overall economic costs of piracy are too high. Yet when making these claims, they continue to assert fuzzy numbers which have not held up to any serious scrutiny.

Further, implementing the Copyright Alert System is not "free" by any means. Investigators need to detect infringement, rightsholder need to oversee their investigators, and the ISPs need to implement a tracking and punishment system for users. Estimates range from $4 to $32 per notification sent, and those costs are not borne by the person receiving the notice. They are paid for by all of us, in the form of higher prices for both content and Internet service. In essence, the system places a tax on Internet service designed to benefit content owners without any corresponding benefit for the vast majority of consumers.

Another justification the parties have given: the educational nature of the Copyright Alert System is preferable to the coercive nature of copyright infringement litigation. This is a valid point. The merits of such an arrangement, however, are directly related to whether a person has been accurately identified as an infringer. So far, content owners have not always acted in a fashion that instills confidence they can correctly identify infringing users or works at scale. That's extremely problematic when creating a system which presumes that identifications are correct, and that forces consumers to prove that they are not.

Is "less government" a good thing?



This isn't to say that the Copyright Alert System is necessarily a bad idea, in general. It is possible—even probable—that educational alerts will both reduce piracy and keep consumers out of federal court for minor charges.

But the issue is the complete exclusion of the government from involvement; though the White House helped broker the deal, government power—and therefore democratic accountability and judicial oversight— are absent. Everyone agrees something needs to be done to lower the cost of copyright enforcement, but copyright is still a right that originates from the government. Ultimately that is where any relief for content owners should begin.

In her recent book, Consent of the Networked (read our review), author Rebecca MacKinnon discusses how many consumers are now residents of "Facebookistan" and "Googledom," reminding us of the power these two companies hold over consumers. But this power pales in comparison to the power exercised over consumers by their local ISPs, which control the very pipes that connect people to Google and Facebook.

Congress is the body that writes laws affecting interstate commerce. Antitrust, at least in part, offers protection against private companies doing the same. Recent reports indicate that the alert system, until now off to a slow start, will soon start affecting Internet users. Once it does, regulators must look closely to make sure the system lives up to its main promise as an educational tool rather than a system of vigilante justice.

Sean Flaim is a recent graduate from the Catholic University of America, Columbus School of Law, where he specialized in antitrust, intellectual property, and communications law and policy.