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Press Release

FreedomWorks Foundation Releases Study Analyzing Hollywood’s New Threats to Innovation in the Digital Economy

Today FreedomWorks Foundation released Issue Analysis Number 125, “Hollywood vs. Consumers: Does Tinseltown Hurt Itself with Consumers by Stifling 21st Century Innovation?” authored by Chief Economist Dr. Wayne T. Brough.  The study looks at new threats to innovation in the digital economy and specifically examines a recent lawsuit filed by the motion picture studios to ban RealDVD, a new software technology that allows consumers to back up copies of DVDs they have purchased legally to their computers’ hard drives.

The study finds that the lawsuit will do little to achieve its stated goal of curbing DVD piracy and protecting intellectual property since the RealDVD product does not permit users the ability to burn movies onto a disc or load movies onto the web.  Instead, the lawsuit, if it wins, would not only ban RealDVD, but set a dangerous precedent in hampering competition and technological innovation in one of the most dynamic sectors of the economy.

FreedomWorks Foundation has long been an advocate internet freedom and technological innovation as a critical source for increased productivity and economic growth.  The lawsuit against RealDVD, which begins Friday in a San Francisco federal court, poses a serious threat to innovation in one of the most dynamic sectors of the economy.

Chief Economist Dr. Wayne Brough commented, “The courts should reject outright the motion picture studios’ lawsuit to ban RealDVD.  There are acceptable avenues of protecting intellectual property, but banning a new product that maintains the DRM encryption and prohibits copying for distribution in the name of fighting piracy makes no sense.  All this does is impose substantial new limitations on consumers and their use of the DVDs they purchase.”

Dr. Brough is available for further comment.  For inquiries and press availability, please contact FreedomWorks Foundation press secretary Adam Brandon at 202-942-7698 or via email.

Download a .pdf version of the full study complete with footnotes by clicking here!