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Napster redux? Caribbean nation gets legalized piracy

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Visions of Napster must be dancing in content providers' heads. The World Trade Organization (WTO) has given the Caribbean nation of Antigua and Barbuda (ironically located in a region noted for its historical piracy) carte blanche to ignore U.S. intellectual property rights as reparations for a longstanding trade dispute.

The Caribbean nation hosted several popular offshore gambling sites that ran afoul of the American government. The U.S. forbade its citizens from using them after it began to enforce a 2006 federal gaming ban, and subsequent crackdowns have targeted the owners and users of offshore gambling sites - including those based in Antigua and Barbuda. Those actions stung the country's economy, Antiguan officials say.

"The economy of Antigua and Barbuda has been devastated by the United States Government's long campaign to prevent American consumers from gambling on-line with offshore gaming operators," Harold Lovell, Antigua's Finance Minister, said in a statement to the press.

"These aggressive efforts to shut down the remote gaming industry in Antigua has resulted in the loss of thousands of good paying jobs and seizure by the Americans of billions of dollars belonging to gaming operators and their customers in financial institutions across the world," Lovell continued.

Antigua and Barbuda sought a legal remedy from the WTO on the grounds that the U.S. campaign against offshore gambling violated trade agreements and negatively impacted its economy. The WTO has agreed, and has devised sanctions to compensate for the lost business that will lift enforcement of U.S. copyrights.

That could result in Hollywood films and U.S. music being sold at fire sale prices, and the U.S. would have no recourse under international law to shut those services down. It would be an unwelcome development for U.S. content providers that have been wrestling with the effects of Internet piracy and the minutiae of creating new distribution models that incentivize consumers not to obtain their digital media illegally.

An Obama administration spokesperson told the New York Times that the U.S. was disappointed in the WTO's ruling, which the U.S. says uprooted "constructive settlement discussions" that the U.S. believes would benefit the businesses and people of Antigua and Barbuda, the spokesperson explained.

Content providers are very influential with the U.S. Congress, which has enacted industry-favorable legislation including the Digital Millennium Copyright Act (DMCA). There is a possibility that a disruptive Napster-like service could soon launch, but it will likely be averted by America's well-greased politicians heeding the interests of its massive and monied entertainment industry.

(image credit: http://islandsouthfl.com/)

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— By on January 30, 2013, 12:07 PM PST

David Worthington

Contributing Editor

David Worthington has written for BetaNews, eWeek, PC World, Technologizer and ZDNet. Formerly, he was a senior editor at SD Times. He holds a business degree from Temple University. He is based in New York. Follow him on Twitter. Disclosure