New Study From Booz & Co. Shows That SOPA/PROTECT IP Will Chill Investment In Innovation

from the indeed dept

Booz & Co., which is one of the most respected consulting/research firms around, has come out with the results of a new study, looking into how venture capital and angel investors will respond to new laws like PROTECT IP and SOPA, and found that a large majority of them would avoid investing in user generated content sites over fear concerning the liability.
  • A large majority of the angel investors and venture capitalists who took part in a Booz & Company study say they will not put their money in digital content intermediaries (DCIs) if governments pass tough new rules allowing websites to be sued or fined for pirated digital content posted by users.
  • More than 70% of angel investors reported they would be deterred from investing if anti-piracy regulations against “user uploaded” websites were increased.
In fact, the survey found that investors actually would prefer to invest in a weaker economy than a stronger economy with SOPA/PROTECT IP in place. But if the definitions were actually narrowed to not impact so many legitimate startups, they'd invest again:
  • More than 80 percent of the angel investors would prefer to invest in a risky, weak economy (with the current internet regulations) vs. a strong economy (but with the new, more stringent proposed regulations on copyright infringement).
  • If the legal framework for digital content was clarified, and penalties on copyright infringement were limited for content providers acting in good faith, the pool of angels interested in investing would increase by nearly 115 percent.
Hollywood can continue to pretend that only its jobs are the ones that matter, but repeated studies have shown that job growth comes from new startups, and VCs and angels are what make new startups possible. Chilling investment is no way to help create jobs.

Filed Under: angel investors, copyright, investments, protect ip, sopa, studies, venture capital

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  1. identicon
    Anonymous Coward, 16 Nov 2011 @ 12:54pm


    "by rejecting ANY copyright based potential business models"

    Why should the tech community have to accept an IP based business model?

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