Understanding IP Matters: Piracy Costs Up to $71 Billion Annually

Stealing intellectual property (IP) assets such as music and movies diverts revenue away from American businesses, which leads to fewer jobs for a range of American workers in the entertainment industry.

Some countries in the world actively address this pirating through enforcement of site blocking by their respective national Internet Service Providers. However, the United States is not one of them, in part due to governmental pressure from certain Big Tech companies.

Watch here.

On the current episode of Understanding IP Matters (UIPM), Ruth Vitale, Hollywood producer, founder and co-president of Paramount Classics, and president of Fine Line Features, discusses her efforts to effect U.S. legislation that would allow for site blocking, thereby strengthening the entertainment industry and protecting U.S. consumers. As the entertainment industry is a top cultural exporter in the United States, this added protection and greater retained revenue would ensure this status continues and grows.

Vitale’s films have won three Oscars and received 16 Academy Award nominations, as well as 18 Golden Globe nominations. As president of production for Vestron Pictures, she broke new ground with the highest-grossing independent film of the time, “Dirty Dancing”. Vitale is now CEO of CreativeFuture, a nonprofit coalition of more than 500 organizations and 300,000 individuals that support the value of creativity.

In this episode of “Understanding IP Matters,” Vitale and host Bruce Berman discuss:

• Vitale states that each year “piracy cost the U.S. economy between $29 billion and $71 billion a year in lost revenue and between 230,000 and 560,000 jobs”.
• Site blocking is crucial to the protection of America’s creative industry. Some organizations that oppose strong copyright protections say that “having site blocking as a slippery slope towards freedom of speech violations.” Vitale strongly disagrees and has asked for a more convincing argument. “I have said, ‘I’m sorry, please explain to me how it is that your stealing my movie has anything to do with your freedom of speech rights.’”
• Vitale thinks that artificial intelligence (AI) companies, especially those that are developing large language models (LLMs), “are talking out of both sides of their mouth.   They don’t want to have to pay for the content that their LLMs are using. At the same time, they get up in arms when China steals their AI… You can’t have it both ways.”
• That film and entertainment industries are not just what is seen at the Oscars and other red-carpet galas. Vitale discusses the production process that requires hundreds of workers for hours and hours each day. “It’s REALLY difficult. I always say to people, why do we do it? Because we can’t imagine doing anything else.”
• Since the U.S. entertainment industry operates at a massive scale, Vitale acknowledges that many people are unaware of the “2.3 million Americans that work in film and television.” That lack of awareness is a problem; beyond a few household names, these craftspeople “are doing carpentry, and painting, and set design, and sewing costumes” and “when people steal, they’re stealing from those people.”