Cato Institute says law reduces options and competition for consumers

US think-tank the Cato Institute has launched a scathing attack on the Digital Millennium Copyright Act (DMCA) in a report entitled Circumventing Competition: The Perverse Consequences of the DMCA.

The DMCA was introduced in 1998 essentially to remove the courts from the role of fashioning balanced remedies for the copyright challenges created by new technologies with an outright ban on technology capable of circumventing DRM.

The Cato Institute claims that the result has been a legal regime that reduces options and competition in how consumers enjoy media and entertainment.

It asserts that the copyright industry is exerting increasing control over playback devices, cable media offerings and even internet streaming.

Moreover, the Cato Institute claims that some firms have used the DMCA to thwart competition by preventing research and reverse engineering, while others have brought the weight of criminal sanctions to bear against critics, competitors and researchers.

"The DMCA is anti-competitive. It gives copyright holders and the technology companies that distribute their content the legal power to create closed technology platforms and exclude competitors from interoperating with them," the report states.

"Worst of all, DRM technologies are clumsy and ineffective. They inconvenience legitimate users but do little to stop pirates."

The Cato Institute also believes that a repeal of the DMCA would not lead to intellectual property anarchy.

"Prior to the DMCA's enactment, the courts had already been developing a body of law that strikes a sensible balance between innovation and the protection of intellectual property," the report continues.

"That body of law protected competition, consumer choice and the important principle of fair use without sacrificing the rights of copyright holders."

The full text of the report (PDF 150KB) is available for download from the Cato Institute website.