An August 2020 report by the Digital Citizens Alliance estimated that illegal IPTV services annually generate $1 billion in U.S. subscription revenues, with 9 million fixed broadband subscribers. Moreover, there is evidence that these online piracy streaming services have increased in popularity since the beginning of the 2020 lockdowns. For example, the piracy tracking firm Muso found a 43% surge in American visits to movie pirating sites during the last week of March 2020 compared to a month earlier.
Federal copyright law criminalizes intentional or willful infringement of protected works. Criminal prosecutions are not numerous, and they are directed against traffickers in pirated works, not individual Internet users. Such prosecutions are necessary to address bad actors who inflict harm on a mass scale on copyright owners and evade the civil justice system.
But as Free State Foundation President Randolph May and I point out in our book, Modernizing Copyright Law – Constitutional Foundations for Reform, federal copyright law predates the precipitous rise of illicit video and music streaming services. Under existing law, criminals who operate illegal IPTV streaming services can only be charged with misdemeanor infringement, not felony infringement. As a result, operators of these illegal streaming services face less severe penalties than operators of online piracy sites for downloading copyrighted movies and music. There obviously is no reason for this disparity in the law. Also, prosecutors generally are reluctant to direct substantial resources towards misdemeanors. Streaming piracy deserves stronger sanctions, and stiffer penalties are needed to ensure future prosecutions against illegal streaming piracy.
By increasing enforcement against sophisticated illicit streaming copyright criminals, the Protecting Lawful Streaming Act of 2020 will modernize the law. The legislation was introduced by Sen. Thom Tillis with bipartisan backing. The legislation provides that it is a felony for persons to "willfully, and for purposes of commercial advantage or private financial gain" offer digital transmission services to the public. It is narrowly targeted to digital transmission services that are primarily designed for unauthorized streaming (or public performances) of copyrighted works, have no commercially significant purpose other than unauthorized streaming of copyrighted works, or are intentionally marketed to promote their unauthorized streams. Notably, the terms of the Protecting Lawful Streaming Act are not directed toward individual Internet users or subscribers of IPTV services.
As of this writing, the Protecting Lawful Streaming Act is attached to the omnibus spending bill being considered by Congress. Budgetary issues aside, the Protecting Lawful Streaming Act is strong on its own merits. In whatever legislative vehicle proves most practical, Congress should pass the bill and the President should sign it.