Caving to a massive campaign by Internet services and their millions of users, Congress indefinitely postponed legislation Friday to stop online piracy of movies and music costing U.S. companies billions of dollars every year. Critics said the bills would result in censorship and stifle Internet innovation.

The demise, at least for the time being, of the anti-piracy bills was a clear victory for Silicon Valley over Hollywood, which has campaigned for a tougher response to online piracy. The legislation also would cover the counterfeiting of drugs and car parts.

Congress' qualms underscored how Internet users can use their collective might to block those who want to change the system.

The battle over the future of the Internet also played out on a different front Thursday when a loose affiliation of hackers known as "Anonymous" shut down Justice Department websites for several hours and hacked the site of the Motion Picture Association of America after federal officials issued an indictment against Megaupload.com, one of the world's biggest file-sharing sites.

In the U.S., momentum against the Senate's Protect Intellectual Property Act and the House's Stop Online Piracy Act, known popularly as PIPA and SOPA, grew quickly on Wednesday when the online encyclopedia Wikipedia and other Web giants staged a one-day blackout and Google organized a petition drive that attracted more than 7 million participants.

On Friday, Senate Majority Leader Harry Reid, D-Nev., said he was postponing a test vote set for Tuesday "in light of recent events." House Judiciary Committee Chairman Lamar Smith, R-Texas, followed suit, saying consideration of a similar House bill would be postponed "until there is wider agreement on a solution."

The two bills would allow the Justice Department, and copyright holders, to seek court orders against foreign websites accused of copyright infringement. The legislation would bar online advertising networks and payment facilitators such as credit card companies from doing business with an alleged violator. They also would forbid search engines from linking to such sites.

The two bills would allow the Justice Department, and copyright holders, to seek court orders against foreign websites accused of copyright infringement. The legislation would bar online advertising networks and payment facilitators such as credit card companies from doing business with an alleged violator. They also would forbid search engines from linking to such sites.

The chief Senate sponsor, Judiciary Committee Chairman Patrick Leahy, D-Vt., cited estimates that copyright piracy costs the American economy more than $50 billion annually and that global sales of counterfeit goods via the Internet reached $135 billion in 2010. He and Smith insist that their bills target only foreign criminals and that there is nothing in them to require websites, Internet service providers, search engines or others to monitor their networks.

That didn't satisfy critics who said the legislation could force Internet companies to pre-screen user comments or videos, burden new and smaller websites with huge litigation costs and impede new investments.

The scuttling, for now, of PIPA and SOPA frustrates what might have been one of the few opportunities to move significant legislation in an election year where the two parties have little motivation to cooperate.

Until recently "you would have thought this bill was teed up," with backing from key Senate leaders and support from powerful interest groups, said Sen. Jerry Moran, R-Kan., who cosponsored the original bill but quickly dropped his backing on the grounds the bill could undermine innovation and Internet freedom.

Moran said the "uprising" of so many people with similar concerns was a "major turnaround, and in my experience it is something that has happened very rarely."

Moran said PIPA and SOPA now have "such a black eye" that it will be difficult to amend them. Reid, however, said that there had been progress in recent talks among the various stakeholders and "there is no reason that the legitimate issues raised by many about this bill cannot be resolved."

Jeff Chester, executive director for the Center for Digital Democracy, a consumer protection and privacy advocacy group, said Google and Facebook and their supporters "have delivered a powerful blow to the Hollywood lobby." He predicted a compromise that doesn't include what many see as overreaching provisions in the current legislation.

"It's been framed as an Internet freedom issue, but at the end of the day it will be decided on the narrow interests of the old and new media companies," he said. The big questions involve who should or shouldn't pay — or be paid — for Internet content.

The bill's opponents were relieved it was put on hold.

Markham Erickson, executive director of NetCoalition, commended Congress for "recognizing the serious collateral damage this bill could inflict on the Internet."