Silicon Valley needs to step up and protect the open traditions that have helped build the high-technology industry or run the risk of being dominated by "IP extremists" whose restrictions on the use of intellectual property (IP) would stifle innovation, Stanford Law School Professor Lawrence Lessig told the audience at the Open Source Business Conference in San Francisco Tuesday.

Citing a decision last year by the World Intellectual Property Organization to cancel a meeting on the role of open source in world intellectual property law, Lessig said that the argument over intellectual property law has become unnecessarily polarized because entities such as the Recording Industry Association of America (RIAA) claim that there are only two choices when it comes to IP: maximum copyright protection or anarchy.

In reality, Lessig said, the U.S. has long held a balanced approach to intellectual property. Until 1891, for example, the United States did not observe international copyright laws, and until 1976, the vast majority of intellectual property created in the U.S. was not protected by copyright, he said. "We were born a pirate nation," he said.

Lessig is one of the founders of the Creative Commons, a project aimed at increasing the amount of copyrighted work that is available to be shared. In 2002 he argued unsuccessfully before the U.S. Supreme Court that the Sonny Bono Copyright Term Extension Act, a U.S. law extending the terms of copyright, should be ruled unconstitutional.

In his talk Tuesday, Lessig argued that balanced intellectual property laws were essential to innovation, which often flourishes without strict IP encumbrances. "This debate is not commerce versus anything," he said. "This debate is about whether powerful interests can stop new innovations. It is a cultural dilemma."

Without the abdication of at least some intellectual property rights, important "intellectual commons" such as the Internet, the Human Genome Project, and even the Global Positioning System could never develop, he said.

Silicon Valley has not been mindful of the role that open standards and the free exchange of intellectual property have played in creating the high-technology industry and has allowed others to portray the call for balanced IP laws as an extreme position. "It's totally wrong that the extremists can define this debate in a way that makes the obvious seem extreme itself," he said. "We in the Valley have been totally pathetic in defending this totally obvious claim."

Lessig's message clearly resonated with the approximately 500 attendees in the audience, who treated Lessig to a sustained ovation.

Hollywood interests have taken the upper hand in framing U.S. legislation over copyright, said Tim O'Reilly, the president of book publisher O'Reilly & Associates Inc., after listening to Lessig's talk. Silicon Valley has been noticeably quiet as the RIAA has gone about suing users for copying music, even though the high-tech industry tried and failed to crack down on unauthorized copying itself in the past, he said. "Nobody is saying, 'We tried this in the Eighties with copy protection software.'"