Everybody Is Wrong About Piracy

What a week for the Internet. Is there a way out of the madness?

First, Wikipedia led the charge of the light brigade against proposed anti-piracy bills by "blacking out" entirely on Wednesday. The user-sourced dictionary says that 8 million people looked up their elected representatives through Wikipedia's blackout page.

Google took a less in-your-face route by offering protest tools alongside its regular services rather than replacing them altogether, but that approach was just as effective: Big G claims that over 7 million anti-legislation signatures were collected.

Since a signature on paper is worth at least ten page views, I think Google played a much greater role in the protests than Wikipedia ever did. Regardless, the campaign made a big impact overall: according to Wikipedia chief Jimmy Wales, the number of senators opposing the Senate version of the anti-piracy measures bloomed from five to 35 this week. That's just short of the 41 "nay" votes needed to turn it down. Indeed, both proposals have been officially delayed by their respective backers. There's teeth in those signatures.

While the online protests were going on, the Occupy Wall Street protests spawned a separate meet-up in New York to rail against the anti-piracy proposals. Plans for a similar action in Seattle were stopped only by a heavy snowstorm. People aren't just clicking to voice their opinion -- they're ready to get out in the streets and start kicking.

So far, that's a good week for an innovation-nourishing, uncensored Internet.

But then some killjoys decided to spoil the party.

Here come the Feds
First, police in New Zealand, in conjunction with the FBI, launched a long-planned sting against notorious file-sharing site Megaupload.com, arresting four operators and shutting down the offending site. The Motion Picture Association of America (MPAA) "applauds" the action against a site that supposedly generated $175 million in advertising revenue while costing U.S. copyright holders more than $500 million.

Sounds like a perfectly appropriate action, in line with cracking down on another spamming operation or filing lawsuits to shut down music-sharing antediluvian Napster, right? Oh, but infamous hacker group Anonymous didn't agree. They took action.

The snack that strikes back
A heavy barrage of so-called "denial of service" attacks brought down the websites of the Justice Department, several music publishers, the RIAA music industry group, and yes, the MPAA that crowed so loudly about the successful sting.

That's exactly the wrong thing to do in protest of censorship, free-speech violations, or the onrushing death of open innovation. Running this hack attack on Thursday, Anonymous just erased tons of goodwill for the cause that was created on Wednesday. Easy come, easy go.

What's the silver bullet, then?
Both sides of this seemingly eternal conflict need to simmer down, lest we, the people, take some really drastic measures.

The hack attacks are inferior to more measured protests in terms of ethics, legal status, intellectual bankruptcy, and PR value. It's like using a hammer to fix a broken window. Killing one thug only makes his whole family pick up arms because now they all hate you. Stop it already.

And that argument swings both ways. Content producers should understand that the way to kill piracy is not through stricter legislation but by creating affordable and useful media services that can compete with the pirates head to head.

And there are signs of life. Walt Disney (NYS: DIS) executives have shown some appreciation of that competitive strategy for years. Even the MPAA noted that "Infringing content on megaupload.com and its affiliates is available in 20 languages, targeting a broad global audience."

Doesn't that just sound like an attractively global and flexible business model?

And if the association's numbers for Megaupload are correct, then you have consumers putting their ethics on the backburner to swashbuckle some content for about one-third the price Hollywood wanted to charge directly. Create a legal and easy-to-use movie and music hub, and you can probably get away with charging half price or even just 30% off -- convenience and moral superiority are worth something, after all. Just not the premiums studios are asking for today.

The heroes you need are already here!
(NAS: AAPL) and Amazon.com (NAS: AMZN) are each working towards becoming that ideal portal. Netflix (NAS: NFLX) slashes prices even further in exchange for a weaker content library, and even then only on the movie side. Spotify, Pandora Media (NYS: P) , and many others offer variations on the Netflix theme in the musical realm.

These are the companies that hold the keys to end piracy. But the pirates still hold an edge as long as they can offer content faster, cheaper, and in more places than the legal alternatives can.

Put the techies and distributors in a room with major studio executives and throw away the key. Don't bulldoze the door down to let them out for air until they agree to settle their differences with the consumer in mind. Lawmakers don't even enter into the equation; the Constitution's copyright measures provide all the legal support we need.

That's the only way to end this ridiculous back-and-forth between pirates and police. The truly committed freeloaders will always find a way to get their kicks, but the mass market is a whole 'nuther story -- most consumers want to do the right thing as long as the price is right. Illegal downloading may never end, but the right approach could slow it down from a torrent to a trickle.

Amazon fights the old establishment on many fronts. This special report exposes all about the rebellious ways of Jeff Bezos and how he's making investors a ton of money doing it. Get yours now -- it's free for a limited time.

At the time thisarticle was published Fool contributorAnders Bylundowns shares of Google and Netflix but holds no other position in any of the companies mentioned. The Motley Fool owns shares of Apple, Google, and Amazon.com.Motley Fool newsletter serviceshave recommended buying shares of Disney, Apple, Netflix, Google, and Amazon. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinion, but we all believe that considering a diverse range of insights makes us better investors. Check outAnders' holdings and bio, or follow him onTwitterandGoogle+. The Motley Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.