Millions in SOPA lobbying bucks gone to waste

@CNNMoneyTech January 27, 2012: 10:58 AM ET
Google blacked out its logo last week in opposition of the Stop Online Privacy Act and the Protect IP Act.

Google blacked out its logo last week in opposition of the Stop Online Privacy Act and the Protect IP Act.

NEW YORK (CNNMoney) -- The controversial anti-piracy bills that attracted tens of millions of dollars of lobbying for and against the proposed laws ironically were killed by free publicity.

"Old" media companies spent huge sums of money in support of the Stop Online Piracy Act (SOPA) and the Protect Intellectual Property Act (PIPA). Those opposed -- Internet and "new media" companies -- lobbied hard and spent gobs too, though far less than their more organized rivals.

But Silicon Valley had a trick up its sleeve that trumped the millions of dollars more in lobbying muscle and the more established Washington presence of the old media guard: They reached out directly to their users for free.

Google, Wikipedia and others altered their homepages and websites in opposition of the bills last week, making the issue a topic of popular discussion across the country.

"The Internet really flexed their muscles during this fight, and their infrastructure helped them advocate their positions that others don't have at their disposal," said Michael Beckel, money-in-politics analyst at the Center for Responsive Politics.

It helped that the two bills were an issue that the public cared about. The opposition movement was trending on Twitter, and thousands of protesters joined in New York and San Francisco on Jan. 20 in opposition of the bills.

"When you have an issue that is salient, and the public cares about it, the money matters less," said Lee Drutman, data fellow at the Sunlight Foundation, a nonpartisan research organization. "Money matters more when it's a behind-closed-doors issue that hasn't faced much public scrutiny."

Lobbying analysts also note that it's really hard to change the status quo and pass legislation. Silicon Valley had the advantage of playing defense, which is a much better position to be in, experts said. There are so many hurdles to jump before a bill becomes law, so being on the opposition is always a good start.

It may have been painted as a David vs. Goliath fight initially. But the end result proved that the most money doesn't always win in Washington.

SOPA explained: What it is and why it matters

Media companies like Comcast (CMCSA, Fortune 500), Viacom (VIA), News Corp. (NWS), and CNNMoney parent Time Warner (TWX, Fortune 500) led the support of the bills, each spending millions of dollars on the issue.

Media lobbyists, including the motion picture, recording industry, cable, and broadcaster associations, also added millions of dollars to the fight, as did credit card firms Visa (V, Fortune 500), MasterCard (MA, Fortune 500) and American Express (AXP, Fortune 500).

Loads of cash were spent by the opposition as well, but most of that came from Google (GOOG, Fortune 500). After the search giant's millions, there was a steep drop off in lobbying dollars, with Yahoo (YHOO, Fortune 500), eBay (EBAY, Fortune 500), Amazon (AMZN, Fortune 500) and Microsoft (MSFT, Fortune 500) lobbying in the hundreds of thousands of dollars each.

Lobbying totals are only very rough estimates because companies often include multiple bills and issues in their lobbying reports to Congress. But Washington analysts said SOPA and PIPA were among the hottest issues in the fourth quarter.

A total of 145 companies and organizations lobbied the House of Representatives for and against SOPA, while 157 groups lobbied for and against its sister bill PIPA in the Senate, according to the Center for Responsive Politics.

Despite the big win for new media, experts don't believe that this is the end of lobbying as we know it. The piracy issue was unique in many respects, experts contended. Content providers took a unified stance -- a rarity. And it was an issue that the public rallied behind -- also a rarity.

What's more, Internet companies may need to pick their political battles more carefully going forward. They could risk alienating their users, experts contended.

So even though lobbying wasn't what ultimately did SOPA and PIPA in, it's very much here to stay. To top of page

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.