High-Tech: U.S. Out of Hollywood

The heaviest hitters in the high-tech world tell Congress to stay away from the digital rights business while they work things out with the film industry. Declan McCullagh reports from Washington.

WASHINGTON -- America's largest and most powerful tech firms have agreed on one point: Keep Congress far away from digital content standards.

In a 600-word letter sent to movie studios on Wednesday afternoon, the chief executives of IBM, Microsoft, Motorola, Intel and five other corporations said they were eager to work with Hollywood to find "technically feasible, cost effective solutions" for protecting entertainment delivered in digital form.

The letter ostensibly went to the chief executives of Walt Disney, AOL Time Warner, MGM, Sony Pictures and so on -- but the real audience was Senate Commerce chairman Fritz Hollings (D-South Carolina), who is convening a hearing Thursday morning on whether the U.S. government should require that copy protection be embedded in nearly all PCs and consumer electronic devices.

Hollings has drafted, but has not introduced, legislation called the Security Systems Standards and Certification Act (SSSCA). A draft of the SSSCA obtained by Wired News prohibits creating, selling or distributing "any interactive digital device that does not include and utilize certified security technologies."

That's precisely the kind of bureaucratic meddling that Silicon Valley historically has loathed. While the tech CEOs' letter was gently worded, it left no doubt about their views: "We have found these voluntary multi-industry standards setting efforts to be optimally effective in reaching workable market solutions."

Hollywood executives fret that without strong copy protection in widespread use, digital versions of movies will be pirated as readily as MP3 audio files once were with Napster. With Hollings' SSSCA enacted, the thinking goes, U.S. technology firms will have no choice but to insert copy-protection technology into future products.

The group behind the letter is the Computer Systems Policy Project -- at 13 years old, one of Washington's older tech lobbying groups -- which is an affiliation of eight chief executives. All but two, Hewlett-Packard's Carly Fiorina and NCR Corp.'s Lars Nyberg, signed the letter.

CSPP spokeswoman Jennifer Greeson said the letter had been in the works "for quite some time," but Hollings' hearing scheduled for Thursday gave the project some urgency.

"We wanted to communicate to industry and members of Congress the commitment of the high-tech industry at the highest levels," Greeson said. "There is a consensus within the industry that a government-mandated standard is not in the best interests of effectively solving this problem."

The CEO letter said that they "recognize the critical importance of effective anti-piracy tools in this changing market environment, and that the absence of such tools may affect the development of new product offerings."

But, they say, content-protection projects including the Copy Protection Technology Working Group and the Moving Picture Experts Group are already underway.

Among the witnesses scheduled to testify on Thursday: Michael Eisner, chairman of the Walt Disney Company, Peter Chernin, president of News Corp., Leslie Vadasz, vice president of Intel, and Jack Valenti, president of the Motion Picture Association of America.