2012]
COPYRIGHT CONSPIRACY
179
In addition, several other studies—studies that are not funded or associated with the content industries—have concluded that online infringement has negligible effects on the sales of copyrighted material. 204 Thus, while the effects of copyright infringement on the incentive to innovate cannot be ignored, neither can they be quantified as a monetary loss or proven to any significant extent based upon the available research. 205 As such, a court would be hard pressed to balance the speculative nature of the figures cited above against the very real harm to consumers who are denied service. Moreover, the Copyright Alert System serves to internalize the economic costs of content owners from copyright infringement broadly onto consumers, whether they infringe or not. The cost of implementing the program has been calculated to be quite high—as much as $32 per notification issued to a consumer. 206 These costs are not likely to be borne solely by ISPs; instead, the ISPs will factor in these costs when determining the monthly rates that they charge to all consumers for broadband Internet service. 207 As such, the costs of the enforcement system will be transferred to consumers, without ever giving them input into the process or even notifying them of these pass-through costs. In effect, the system represents a surcharge on Internet usage of all users designed to benefit the content industries without any corresponding benefit imparted toward the vast
204
Oberholzer-Gee, supra note 200, at 35–37; Micheal Masnick & Michael Ho, The Sky Is Rising: A Detailed Look at the State of the Entertainment Industry, TECHDIRT (Jan. 2012), http://www.techdirt.com/skyisrising/. 205 See Gov’t Acct. Ofc., Intellectual Property: Observations on Efforts to Quantify the Economic Effects of Counterfeit and Pirated Goods 15–16 (April 2010) (noting “it is difficult, if not impossible, to quantify the net effect of counterfeiting and piracy on the economy as a whole.”); Thierry Rayna & Laura Barbier, Fighting Consumer Piracy with Graduated Response: An Evaluation of the French and British Implementations, 8 INT. J. FORESIGHT & INNOVATION POL’Y 294 (2010). 206 See Department of Business, Innovation and Skills, et al., Digital Economy Bill: Impact Assessments 63–81 (Nov. 2009), available at http://www.ialibrary.bis.gov.uk/uploaded/DEBImpact-Assessments.pdf (outlining the costs of the U.K. graduated response system); Michael Geist, Estimating the Cost of a Three-Strikes and You're Out System, MICHAEL GEIST (Jan. 26, 2010), http://www.michaelgeist.ca/content/view/4731/135/; Barry Sookman, The Costs and Benefits of Graduated Response in Copyright Enforcement, BARRY SOOKMAN (Feb. 1, 2010), http://www.barrysookman.com/2010/02/01/the-costs-and-benefits-of-graduated-response-incopyright-enforcement/; Woods, supra note 61. 207 See Woods, supra note 61.