Challenges Remain for Game Industry Despite Recent Achievements—ESA
Despite significant strides, the videogame industry still faces several challenges, including piracy and a Canadian tariff that the Entertainment Software Association said “would expose publishers to additional royalties” for music used in games when they're distributed online, said its annual report released Wednesday. The report was released a week after the Supreme Court handed the game industry a major victory, ruling 7-2 that California’s violent videogame law was unconstitutional (WID June 28 p2).
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Strides in 2010 included an increase in the number of states recognizing the economic benefits of the game industry, ESA said. Twenty-two states now offer tax incentives for game development, after bills creating new or improved incentives were enacted in Florida, Maine, North Carolina and Virginia, it said.
ESA’s main anti-piracy efforts in 2010 included restructuring monitoring and notice-sending for online infringements, with notices covering more than 8.7 million infringing game files; conducting 50 training sessions for about 1,800 law enforcement officials in the U.S., Canada and Mexico about detecting and identifying game piracy; detection, investigation or referral of game piracy cases, with more than 40 ongoing criminal cases in the U.S. and Canada at year-end; managing anti-piracy efforts for members in eight foreign countries; and promoting education of younger age groups about the benefits of IP and the harms of piracy “to preempt future infringing behavior,” it said.
ESA and other members of the International Intellectual Property Alliance filed a Special 301 Report on International Copyright Protection and Enforcement with the Office of the U.S. Trade Representative, ESA said. In it, ESA said it “singled out Canada and Mexico for legislative and enforcement deficiencies, Spain for high online piracy and Brazil for failure to address circumvention of industry anti-piracy technologies.” Other countries where piracy remains a major issue include Italy, Malaysia, Paraguay, Russia and China, it said.
"Rogue” websites are also “harmful” to the industry, ESA said. In September, Senate Judiciary Committee members introduced the Combating Online Infringement and Counterfeits Act that ESA said would provide an “expedited seizure remedy” for the U.S. Department of Justice to seize the domain name of sites found by a court to be mainly engaged in infringing activity and to disrupt delivery of payment and other intermediary services to some sites. That bill was approved by the committee but it died before receiving a vote by the full Senate. It was rewritten under a different name and introduced in May (the Protect IP Act).
ESA last year made efforts to take down 9 million infringing downloadable files that were stored on websites, representing about 2.7 million complete game files, it said. In about 98 percent of cases, the infringing files were removed, it said. ESA is “working to reduce the response time for takedowns, use expedited takedown tools and press other sites for swifter responses to notices,” it said.
ESA and ESA Canada (ESAC) led an appeal last year of proposed Tariff 22. Canada’s Federal Court of Appeal upheld the tariff with regard to music in games distributed online and on game sites, ESA said. Then ESA and ESAC filed a motion for leave to appeal the case to the Supreme Court of Canada, ESA said. The tariff would “impose additional costs on game sites and services by subjecting game downloads to a tariff on music ‘communicated to the public by telecommunications,'” ESA complained.
ESA spent much of 2010 on initiatives to fight violent game laws in California and several other states, it said. As a result of ESA’s “national outreach effort to secure additional support for our position, more than 180 leading First Amendment experts, social scientists, researchers, national organizations and non-profits signed amicus curiae briefs” that were filed with the Supreme Court on behalf of it, ESA said. ESA issued many statements and news releases surrounding the case and “conducted an aggressive 50-state editorial board and columnist outreach strategy,” it said.