CEA and HRRC Caution Congress Against Government Design Mandates That Could Constrain Technology, Competition and Consumers; Analog Hole Legislation is a Bad Solution in Search of a Problem, Says Shapiro.

ARLINGTON, Va. -- The most recent request by content companies to expand copyright law and dictate how consumer electronics products can be designed and used is a bad solution in search of a problem, said Consumer Electronics Association (CEA(R)) President and CEO Gary Shapiro in testimony delivered today before a congressional committee. Testifying on behalf of CEA and the Home Recording Rights Coalition (HRRC), Shapiro made his comments before a hearing held by the Senate Judiciary Committee exploring "The Analog Hole: Can Congress Protect Copyright and Promote Innovation?"

Shapiro outlined the historic and vast expansion of copyright law, stating, "I ask you to consider that every time Congress accedes to the content community requests, someone else is paying the price, in terms of higher consumer prices, unavailable products and features or abusive litigation costs.

"Unfortunately, the analog hole mandate would be another proposal with similar consequences. It would impose government restrictions on new technologies and needs to be considered carefully, because the consequences may be far-reaching, unanticipated and damaging.

"Evidence points away from the analog hole as a source of pirated material," Shapiro noted. "MPAA's own website states that 90 percent of pirated copies come from handheld camcorders. To make matters worse, the only legislation we have seen on this is so broad and unfocused that it could eliminate real products that serve needs and hurt no one. It would impose a massive government design mandate on every product capable of digitizing analog video signals - not just PCs and television, but even those found in airplanes, automobiles, medical devices and technical equipment. It is so overreaching that industry experts remain unsure which products are covered and what key provisions mean."

In closing, Shapiro said, "As we consider these bills, please do not ignore the larger issue of U.S. competitiveness. While other countries are busy developing their technology industries to compete with America, we face attempts from the content companies to suppress technologies to preserve old business models. These technologies have made Americans creators. These new creators are your constituents and they are our consumers. They like to TiVo, time shift, place shift and manage their content and I can't imagine they want the law changed to deny them this right."

HRRC is urging concerned consumers to visit its web site, www.HRRC.org, and to send a message to Members of Congress.

About HRRC

The Home Recording Rights Coalition, founded in 1981, is a leading advocacy group for consumers' rights to use home electronics products for private, non-commercial purposes. The members of HRRC include consumers, retailers, manufacturers and professional servicers of consumer electronics products. Further information on this and related issues can be found on the HRRC website, www.hrrc.org.

About CEA

The Consumer Electronics Association (CEA) is the preeminent trade association promoting growth in the consumer technology industry through technology policy, events, research, promotion and the fostering of business and strategic relationships. CEA represents more than 2,100 corporate members involved in the design, development, manufacturing, distribution and integration of audio, video, mobile electronics, wireless and landline communications, information technology, digital imaging, home networking, multimedia and accessory products, as well as related services that are sold through consumer channels. Combined, CEA's members account for more than $125 billion in annual sales. CEA's resources are available online at www.CE.org, the definitive source for information about the consumer electronics industry.

CEA also sponsors and manages the International CES - Defining Tomorrow's Technology. All profits from CES are reinvested into industry services, including technical training and education, industry promotion, engineering standards development, market research and legislative advocacy.

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