Biz Features

The Worst Is Not Over: Why PIPA Will Kill Small Business

by . January 18th, 2012

Last updated on September 13th, 2022

The recent shelving of HR. 3261, better known as the Stop Online Piracy Act (SOPA), is undoubtedly the best news for US-based small businesses since the beginning of 2012. It would be hard to exaggerate the magnitude of SOPA’s implementation’s impact on not just online commerce but on all the freedoms we have taken for granted. And with PIPA in the works, the fight has just begun.

Content Blocked

Many of our customers are small businesses with websites of their own. If PIPA passes and future incarnations of SOPA are not killed outright, the vast majority will become criminals should they fall under someone’s crosshairs. These bills will criminalize regular internet use, stifle innovation, and destroy entrepreneurship in the United States – all so that more established businesses that hold copyrights can squeeze a few more dollars out of everyone.

Extensive lobbying by the entertainment industry has resulted in SOPA and PIPA being seriously considered by people in Congress. They apparently don’t even know how the internet works, which is quite frankly pretty embarrassing in itself but has dire implications for the way we now live our lives.

Why PIPA is Bad News

SOPA and the soon-to-be-voted and badly-named S. 968, or Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act, also known as PROTECT IP or PIPA, are ostensibly about punishing intellectual property thieves based overseas. But in reality, they are essential tools that give corporations the means to shut down websites that affect their profits- without due process or oversight.

This means every time you share something online on, say, your blog, or your e-commerce site, you risk getting shut down if whoever created or owned the copyright to that content decides it doesn’t like how you used their “property.”

You won’t even get any notification about your domain’s impending doom. Even failing to screen your comments for potentially-infringing content actively will make you a criminal. The worst part is the burden of proof then falls on you to prove you didn’t have any malicious intent when you shared that content.


And it’s all totally arbitrary. For example, Craigslist of all sites was declared a threat by Monster Cable because people on Craigslist advertising second-hand cables constituted a threat to their sales of brand-new cables. Even uploading a video of you singing a copyrighted song onto YouTube will become a criminal act. Sites like Facebook, Reddit, Wikipedia, and YouTube- any site that allows sharing content with minimal screening- will become criminal enterprises.

Considering how much of the news industry is tied up with the entertainment industry supporting net legislation, it may very well be leveraged as a way for corporations to impose censorship. Simply by making up some absurd excuse about intellectual property protection, they can threaten domain registrars with a lawsuit if they don’t shut down websites that post things they dislike.

All without even giving the domain owners a chance to present their side and without their knowing just exactly what they did wrong.

Where Does Everyone Stand?

Please take a while to look at the groups that supported SOPA and are trying to get PIPA passed and their opponents.:

Supporters of PIPA and SOPA: RIAA, MPAA, News Corp (includes the Wall Street Journal, Harper Collins, and Fox Network), TimeWarner, Walmart, Nike, Tiffany, Chanel, Rolex, Sony, Juicy Couture, Ralph Lauren, VISA, Mastercard, Comcast, ABC, Dow Chemical, Monster Cable, Teamsters, the mainstream entertainment industry.

Opponents of PIPA and SOPA: Google, Yahoo, Wikipedia, craigslist, Facebook, Twitter, LinkedIn, eBay, AOL, Mozilla, Reddit, Tumblr, Etsy, Zynga, EFF, ACLU, and Human Rights Watch.

The relative ancientness of pro-internet regulation supporters compared with the ones opposing internet regulations is hugely telling. No progressive e-commerce firm will ever support PIPA as it is.

SOPA and PIPA are not so much about protecting rights as they are about safeguarding profits for established companies that aren’t in tune with the times and can’t get with the program.

Why Net Legislation is a Step Backwards

Please don’t take us wrong, but we do NOT endorse copyright infringement. Its actual piracy is a problem, especially for struggling artists who continue to produce works that inspire for little to no compensation. But on the flip side, the internet has made wonderful pieces of work more accessible than ever before.

Implications of SOPA and PIPA
What SOPA and PIPA really mean

Piracy is a problem that always results from defects in the market- the flaws, in this case, being the backward, inefficient, and ham-fisted ways the most extensive corporate PIPA supporters handle pricing and distribution. Progressive systems like iTunes demonstrate that people will still pay for good content, even if they have the choice to download it illegally.

Also, looking at who has spoken out in favor of the bills (clue: it’s not artists), it seems extremely doubtful that these inane pieces of legislation were meant to be anything but a way for market laggards to level a playing field they are no longer able to understand.

Start-ups and new businesses that are actually able to grasp current paradigms have the most to lose. These bills are undoubtedly the most significant threats the internet has ever faced in the Free World.


Arthur Piccio manages YouTheEntrepreneur and has managed content for major players in the online printing industry. He was previously BizSugar's contributor of the week. His work has appeared multiple times on The New York Times' You're the Boss Small Business Blog. He enjoys guitar maintenance and reading up on history and psychology in his spare time.