Statement of Senator Patrick Leahy, Ranking Member, Senate Judiciary Committee Hearing On "The Future of Digital Music: Is There an Upside to Downloading?"

July 11, 2000

America's Founders recognized and valued citizen creativity so much that they rooted intellectual property rights in the Constitution. Article I, section 8, clause 8 of the Constitution grants that: "The Congress shall have power...[t]o promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries." The Continental Congress proclaimed, "Nothing is more properly a man's own than the fruit of his study."

Protecting intellectual property rights is just as important today as it was when America was a fledgling nation. In fact, the intellectual property generated in this country is an economic engine that is the envy of the world.

The challenge of protecting intellectual property such as computer programs, sound recordings, motion pictures and other copyrighted works in electronic formats has been the focus of this Committee's attention for the past few Congresses. In the last Congress, we passed the No Electronic Theft Act to close the loophole in the law that had granted complete immunity from criminal liability to willful copyright infringers. Closing this loophole was something I had worked on since 1995, and together with Senator Kyl, we were able to close that loophole in 1997.

In 1998, the Chairman and I worked closely together on the Digital Millennium Copyright Act, "DMCA," to advance the complementary goals of protecting intellectual property rights in a digitally-networked world and promoting the continued growth of electronic commerce and development of innovative technologies. As new online services are launched and new websites created, the DMCA is helping order the online environment. For example, earlier this year a federal court relied on the DMCA to shut down websites that were used to post a computer program permitting users to break the encryption used to protect copyrighted motion pictures on DVDs, and copy the movies without permission. See Universal City Studios, Inc. v. Reimerdes, 82 F. Supp.2d 211 (S.D.N.Y. 2000).

In other pending cases – involving some of the witnesses we will hear from today – the applicability of provisions in the DMCA, which limit liability for Internet service providers when they act as a mere conduits for network communications or simply provide information location tools, are being explored.

Too often the discussion over how to protect intellectual property rights has devolved into a debate over whether such protection will stop technological innovation. That should not be the case. Protection of intellectual property provides incentives to promote scientific and artistic advancement. But as demonstrated in the current debate over new file-sharing software -- such as Napster, and new online music services, such as MP3.com – the interests of intellectual property protection and technological innovation sometimes appear to collide.

Two years ago, a 19-year-old college freshman created a software program called Napster that has grown exponentially in popularity with users now numbering in the millions. This software program allows users to find music files in other users' hard drives, then access the music file and download it – all in a matter of minutes with the right high-speed connections, and at no cost to the users. Sharing files in this way among strangers has been likened by some to sharing a CD or record among friends. The courts are in the process of sorting out the legality of sharing files of copyrighted music on the scale of Napster. Congress must also be concerned about striking the proper balance.

Despite the publicity given to that case, Napster is not the recording industry's worst nightmare; other software programs are being developed that pose far more difficult challenges for copyright protection. For example, Gnutella and Freenet are file-sharing programs we will hear more about today that, unlike Napster, do not require a central server for users to connect to each other. Instead, Gnutella uses the Internet service providers of its users for connectivity. Furthermore, these programs are not proprietary or owned by a specific company, leaving copyright owners in search of a responsible party to hold accountable.

New online music programs and services show strong consumer demand for new artists and for good music delivered over the Internet. These new distribution channels allow new artists to become known and will open new avenues for the copyright industries to reach consumers. The music industry is accelerating development of legitimate means for satisfying the consumer demand for online access to music -- as well as copy protection systems to ensure that artists can continue to exercise control over their works without unintended global publication.

History has shown that when new technologies emerge, they may initially seem to threaten to trump intellectual property protection. In the end, things get sorted out and the new avenues offer new opportunities for artists and more choices for consumers. To me, the ubiquitous concert tapes of Grateful Dead fans come to mind. I hope that this hearing will give all of us a better understanding of what is at stake and a deeper appreciation and respect for the creative energy that copyright is intended to nurture.