Shades of SOPA-PIPA!* Sen. Thom Tillis (R-N.C.), fresh off the passage of his bill that would make illegal streaming a felony in some cases, has introduced a discussion draft of major copyright reform legislation that has computer companies fuming and studios gently applauding.

“The Motion Picture Association commends Senator Tillis and his staff for their work in seeking to address the shortcomings of the Digital Millennium Copyright Act (DMCA), the Motion Picture Association of America said of the draft. 

Tillis billed the draft (for a summary, click here)  as a landmark effort at reform rather than "tinkering around the edges" and invited comment, which he will surely get, from " all interested stakeholders - large and small, individuals and companies, YouTubers, and independent creators" by March 5.

The draft is the product of a host of hearings in 2020 on the DMCA and input from creators and distributors of copyright works, online service providers, public-interest groups, and academics," MPA pointed out in calling the draft a "first effort to find harmony among their many conflicting views."

Tillis said the bill among other things, "improves the exemptions available to users for circumventing technological protection measures (TPMs), increases attribution protections so that authors can be properly credited, and makes the Register of Copyrights a Presidential appointee and places the Copyright Office under the Department of Commerce."

Also Read: Commerce DMCA Meeting Looks to Tackle Standardized Takedowns First

MPA is particularly pleased with the proposals to narrow the copyright safe harbor it said has been broadened due to a misinterpretation of the DMCA.

On the other side were computer companies and edge providers represented by the Computer & Communications Industry Association (CCIA), whose members include Facebook, Google and Twitter.

They appeared to find discord--and even illegality--rather than potential harmony in the proposal. "

Industry works to provide new tools for greater compensation for creators and lawful alternatives for consumers," said CCIA president Matt Schruers. "Unfortunately, this discussion draft would not benefit individual creators and would impose notice and stay down provisions that are not just too severe but unconstitutional.”

CCIA said the draft "reads like a Christmas wish list for Hollywood and big content companies" and "increases the role of federal agencies in regulating copyright, gives greater power to copyright holders to file small claims suits and also adds rules and penalties impacting how internet companies take down copyright infringement online. "

CCIA said its discussions with Tillis about the draft would be about those many concerns.

*Almost a decade ago, studios and edge providers including Google, waged a battle royal over the Stop Online Piracy Act (SOPA) in the House and its Protect IP Act [PIPA] complement in the Senate. Neither made it into law.

The Copyright Office has released its long-awaited report on Sec. 512 of the Digital Millennium Copyright Act (DMCA) and has concluded that, while it needs re-balancing, that "notice and takedown" regime needs no wholesale changes. 

The office points out that the report was the result of "a multi-year study resulting in two notices of inquiry, tens of thousands of written responses, nine empirical studies, and public roundtables in New York, San Francisco, and Washington, D.C." 

Related: Copyright Office Recommends No Big Changes to Circumvention Prohibition Framework

The section, passed in 1998, created the system of limited liability safe harbor for online service providers in exchange for agreeing to a system for detecting and rectifying copyright infringements, the so-called "notice and takedown" regime 

The report says that the safe harbor system is "unbalanced," saying it was out of sync with Congress' intent, including on "eligibility qualifications for the service provider safe harbors, repeat infringer policies, knowledge requirement standards, specificity within takedown notices, non-standard notice requirements, subpoenas, and injunctions." 

It suggested Congress might want to "fine tune" it to better balance the "the rights and responsibilities of online service providers and rightsholders in the creative industries." 

But wholesale changes, at least ones that fair use fans sought, were what some were looking for.  

“Today the U.S. Copyright Office released its long awaited Section 512 study," said Re-Create Coalition executive director Joshua Lamel. "Unfortunately, the Copyright Office mostly ignored the issues and arguments raised by consumer groups, tech platforms, libraries and others. While we are happy the report did not call for notice and stay down or siteblocking, the changes being suggested are not the ‘fine-tuning’ the Copyright Office suggests, but rather changes that will have a negative impact on the online creative ecosystem. 

For example the report, argues that a court ruling could place liability on rightsholders for who fail to conduct a fair use inquiry before sending a takedown notice, even if the material was infringing. It suggested Congress monitor the fallout from that decision and adjust Sec. 512 as necessary. 

"Despite the report’s original intent to ‘evaluate the impact and effectiveness of the DMCA safe harbor provisions,’ the Office has instead issued a report that only suggests changes that rightsholders asked for," said Lamel. 

“The Motion Picture Association strongly commends the United States Copyright Office for its very thorough report on section 512 of the Digital Millennium Copyright Act (DMCA)," said Motion Picture Association chair Charles Rivkin. 

“When Congress enacted the DMCA in 1998, it envisioned that section 512 would foster a collaborative environment that would ensure effective protections against online copyright theft. The Motion Picture Association agrees with the report’s conclusion that the DMCA ‘is not achieving the balance Congress originally intended’ and ‘fails to provide adequate protection of creators’ rights.’ Courts have interpreted Section 512 to expand the safe harbor in many ways Congress did not intend, and we look forward to exploring the Office’s suggestions." 

Computers companies saw it as a mixed result.

“We are encouraged that the study recognizes wholesale changes to the notice and takedown system are not needed," said the Computer & Communications Industry Association president Matt Schruers. "Since the Office began this inquiry back in 2015, the entertainment industry boomed, led largely by Internet-enabled channels. In the current crisis, digital services that depend upon Section 512 have provided the public with valuable tools to connect, communicate, and gather information. 

“It’s disappointing that the Office’s report says so little about fraudulent use of takedown demands to suppress speech, when it comes on the heels of a major Wall Street Journal investigation that uncovered serious cases of takedown abuse aimed at disappearing legitimate information from public view," added Schruers.

The American Cable Association says its members are having trouble handling a flood of alerts alleging their subs are accessing online content that violates copyright protections and are looking for some help from the Copyright Office and Congress.

That came in comments to the Copyright Office, which is reviewing the Digital Millennium Copyright Act (DMCA) safe harbors. Those provide ISPs with copyright liability protections for their role in delivering digital content to subs.

ACA is particularly concerned about the impact of the Repeat Infringer Liability condition, which requires ISPs to respond to copyright holders' takedown notices for alleged infringing content.

Larger ISPs came up with the Copyright Alert System (CAS or "six strikes") of graduated notifications to infringing subs, but ACA says "is beyond the technical and financial capability of many smaller

and mid-sized providers."

But ACA says thanks to copyright owners' use of "'sniffers,' 'crawlers,' 'bots' and other like means to detect and identify (by IP address) individual instances of alleged infringement," ACA's members, who are small and midsized operators, are getting dozens or even hundreds of such notices every day "indiscriminately alleging that their subscribers are intentionally engaging in infringing behavior."

ACA wants an approach that "establishes a common interpretation of the law’s requirements while allowing for variations in how an online service provider meets those obligations."

Among ACA's key asks:

"Require copyright owners use a standard format for any notices that allege infringement that do not demand cash settlements from Internet users;

"Require copyright owners to send notices to a specific email addresses;

"Adopt guidelines that distinguish between actions that are innocent from willful and circumstances and that specify when service can be restored to a previously terminated user; and

"Resist suggestions that subpoena provisions be expanded to apply to conduit service providers."

The goal of the harbors is to balance the need of copyright holders to protect their content in a world of instant digital copying and transmitting with ISPs need for some protection from liability for a business model that requires them to disseminate content from millions of sources to millions of subs.