US Ruling threatens file-trading-software makers (1 Viewer)

[Xayma]

US ruling threatens file-trading-software makers

* 18:14 28 June 2005
* NewScientist.com news service
* Will Knight

Companies that make peer-to-peer file-sharing software face the prospect a legal blitz after a US Supreme Court ruling that they can be held responsible for copyright infringements by users.

The ruling was welcomed by the entertainment industry as a victory for copyright holders. But some experts warn that it could discourage technological innovation and may drive illegal file-trading further underground.

Peer-to-peer (P2P) software lets users copy music and movie files from each others’ computers and the entertainment industry says the practice costs it billions of dollars in lost revenue every year.

Until now, the entertainment industry has pursued legal action against individual file-traders, but this strategy has not prevented millions of people continuing to share files and has also generated some negative publicity. But the way is now clear for them to target the companies behind the P2P networks instead.
Legitimate uses

The landmark ruling, issued on Monday, stems from legal action brought against two US software firms, Grokster and StreamCast, in 2001, by 28 entertainment companies, including MGM, Walt Disney, EMI and Time Warner.

Two lower courts had previously ruled that the Grokster and StreamCast could not be held responsible for copyright infringement carried out using their software. This was based on a precedent set by another Supreme Court decision, in 1984, which absolved Sony from liability for copyright infringement carried out using Betamax video tapes, because the tapes also had legitimate uses.

Although P2P networks also have legitimate uses, the Supreme Court ruled that Grokster or StreamCast made no effort to stem illicit use of their software.
Protecting livelihoods

"There is no evidence that either company made an effort to filter copyrighted material from users' downloads or otherwise impede the sharing of copyrighted files," Justice David Souter wrote in the Supreme Court's majority opinion. "Each company showed itself to be aiming to satisfy a known source of demand for copyright infringement."

"The Supreme Court has addressed a significant threat to the US economy and moved to protect the livelihoods of the more than 11 million Americans employed by the copyright industries," said Mitch Bainwol, chairman of the Recording Industry Association of America.

Aain Levy, CEO of EMI Music added that his company would "persist in the aggressive pursuit of businesses and individuals who engage in or facilitate the mass theft of copyrighted works". And as well as pleasing entertainment companies, the ruling should also provide a boost for legitimate music download services, such as iTunes and Napster.
Era of uncertainty

But activists and programmers worry that if the decision results in a storm of legal suits, it will have a negative impact on commercial innovation by deterring companies from creating products that might potentially be used for copyright infringement.

Fred von Lohmann, senior intellectual property attorney at the San Francisco-based Electronic Frontier Foundation, says the decision will "fuel a new generation of entertainment industry lawsuits against technology companies" and consequently "unleash a new era of legal uncertainty on America's innovators".

Adam Langley, a P2P programmer in the UK, says the ruling will undermine efforts to gain funding for new ideas. "Your investors are going to need pretty good assurances about the legality of the venture, and that's very much up in the air right now," he told New Scientist. "No one knows where the line is and venture capitalists don't want to be within 100 miles of anywhere it could come down."

Ian Clarke, the programmer behind an experimental, anonymous file-trading system called Freenet, agrees that "many new innovations may be killed off just by the threat of legal action, even if the threat is baseless".

But he adds that new forms of P2P networks will flourish in order to support demand. "One way or another, this ruling is full of loopholes that will be used by some innovators to create technologies to replace today's file sharing networks," Clarke told New Scientist. "The victims will be tomorrow's innovators."
Related Articles

* Peer-to-peer 'seeders' could be targeted
* http://www.newscientist.com/article.ns?id=dn6882
* 14 January 2005
* European music-sharers face legal attack
* http://www.newscientist.com/article.ns?id=dn6504
* 07 October 2004
* Movie and software file sharing overtakes music
* http://www.newscientist.com/article.ns?id=dn6139
* 12 July 2004

Weblinks

* US Supreme Court ruling (pdf)
* http://www.supremecourtus.gov/opinions/04pdf/04-480.pdf
* US Supreme Court
* http://www.supremecourtus.gov/
* Grokster
* http://grokster.com/
* Electronic Frontier Foundation
* http://www.eff.org/
* Recording Industry Association of America
* http://www.riaa.com/

Source: http://www.newscientist.com/article.ns?id=dn7598

Opinions? Are the legitimate uses of filesharing so overshadowed by the illegal uses that it is worth sacraficing innovations in the area to try and minimise the spread of copyrighted material?

 

[LadyBec]

Opinions? Are the legitimate uses of filesharing so overshadowed by the illegal uses that it is worth sacraficing innovations in the area to try and minimise the spread of copyrighted material?

The thing that I think the record companies are missing in this is that people dowmload stuff that they would never pay for, and often use downloading as a kind of "try before you buy thing". I download stuff that i'm either thinking of buying, already own in a different format or would never pay for.
I don't think that it's right to hold the creators of the software responsible - the people that download music do it knowing that it's illegal, and while p2p networks give people the opportunity, they dont make anyone it, or encourage them to.

 

[katie_tully]

People will just go to other extremes to share files and as technology increases people will be able to find innovative ways to get around it.

What would 'legitimate' filesharing be classed as?

 

[Rafy]

You will never stop P2P. The concept of downloading ones music for free has become common pratice in the minds of the majority of people.

It represents a failure of th record companies to seize on the new technologies that presented itself. They are subsequently suffering the result. The record companies should be embracing P2P technologies, rather that trying to dismantle it. Their attempts have proved fruitless.
Only by joining the enemy can they hope to contain it.

 

[townie]

agreed, illegal downloading of music has gone to far to be stopped.

it's time the record companies learnt this, and started providing REASONABLE priced downloadable music (i wouldnt pay more than $1.50 for a track).

 

[Xayma]

anti-mathmite: You would have no problem if someone stole and used your ideas without compensation?

Actually subscription services have been seen to be used. Many colleges in the US are on a trial system on this, where the students are hooked up to a subscription service automatically.

 

[Xayma]

No I believe in absolute freedom in the flow of information, data & resources, and the theft of ideas is different to the copying of music. Whether one person copies music, or a thousand copy music, it still doesn't make it harder for that artist to get in front of a microphone to record themselves.

For almost every one of my 50.9 GB of mp3's, I would never buy the CD from which the song comes. I have only really made a couple of *pirate* music CD's and that's to listen to on the train. But who has a disk-man nowadays.

There is no gain for the artists.. There is also no loss. Them being greedy and crying about their *potential* profit isn't right.

When I start seeing music shops closing down because the total lack of sales.. Then i might start to see the artists point. Until that happens, no. It’s only a relatively small field. In this area, capitalism does make me angry.

Ok what about movies? Programs?

 

[withoutaface]

The capitalist in me says good, but then my harddrive reminds me what it and its two brothers are filled with.

 

[cayte]

It's very rarely the artists who have a whinge about music sharing, they get such a nominal cut of the profits from CD sales. It's recording companies who are the big potential financial losers, however I agree that it's highly unlikely that a significant proportion of downloaded music would translate into CD sales were the technology not there.

 

[Monkey Butler]

No I believe in absolute freedom in the flow of information, data & resources, and the theft of ideas is different to the copying of music. Whether one person copies music, or a thousand copy music, it still doesn't make it harder for that artist to get in front of a microphone to record themselves.

For almost every one of my 50.9 GB of mp3's, I would never buy the CD from which the song comes. I have only really made a couple of *pirate* music CD's and that's to listen to on the train. But who has a disk-man nowadays.

There is no gain for the artists.. There is also no loss. Them being greedy and crying about their *potential* profit isn't right.

When I start seeing music shops closing down because the total lack of sales.. Then i might start to see the artists point. Until that happens, no. It’s only a relatively small field. In this area, capitalism does make me angry.

The artists make sweet fuck all. It's the record companies that are losing out. And 9 times out of 10, the cover art that you keep going on about isn't designed by the artist (err, I mean the band or singer, not the cover artist, although they often don't design the cover either).
And when you say shit like you've got 50 GB worth of music on your computer, I start to understand what the record companies mean. That's about, what, 10 000 songs? Almost 1000 albums? And you're saying you wouldn't pay for a single one, that's just fucking greedy.

And as for your first paragraph, well, I think it speaks for itself.

 

[neo o]

Personally, I think that taking legal action against the end user is more appropriate than taking action against providers of software such as Grokster, since it's the end user who is actually breaking the law.

Most of the moden file sharing networks are decentralised. Napster was successfully sued because file data was stored on centralised servers. Companies such as Grokster are liable merely for providing software which may be used to break the law, though they aren't breaking the law themselves. The Betamax case established this, and I'm surprised that it was over-turned (or was it distinguished?).

This is bad news for ISPs (are ISP's now liable if they don't take positive action to prevent customers from breaking the law?). Also, what's stopping this precedent from applying to manufacturers of other goods? CD/DVD burners, CD-RW's, blank tapes etc.

 

[Rafy]

Note to self: Must steal something from anti-mathmite.

 

[MoonlightSonata]

Copyright laws are legitimate ways of protecting manifested ideas, and I believe that people are entitled to have their work protected from others. I think that the law should be very lenient and soft on private users however.

Previous laws
There is of course, something to be said about punishing those who provide a means by which people can infringe copyright. The case law was such that if there was a way to use the devices or services for a legal purpose, then even if it could be used for an illegal purpose it doesn't matter -- they would not be liable. For instance the cassette player case where it could record and playback at the same time. Although there was a way for it to be used illegally, it could also be used for perfectly legal uses, hence there was no problem.

This case
In this case, the Supreme Court has said that this idea isn't so simple. They are looking at the extent to which something can be used illegally compared to the legal side. Since, they say, these file sharing programs are overwhelmingly used for illegal purposes, then they must put a stop to it. The companies providing the file-sharing sites or programs took positive steps that encouraged people to infringe copyright.

Escaping the consequences
I wonder what the outcome would be if they took absolutely no steps to induce people into doing the wrong thing. Moreover what would the outcome have been if they had put warnings on their sites or file-sharing systems which stated "you must not use this for illegal purposes, such as infringing copyright"?

The moral issue
The moral question about downloading music still remains though - should we be liable for downloading music we don't own and haven't paid for? There is no denying people are stealing something - we are taking something we do not own. Yet the fact remains it is common practice. I think the law should move in a direction where there are penalties for infringing copyright in this way, but very small penalties for private users who make no profit off it themselves. People who sell material they do not own deserve much higher penalties. But I think, theoretically, there is some wrong being committed. Intuitively it seems okay by us, but I think that is more our feelings of inconvenience and habit playing on our conscience.

 

[Monkey Butler]

If you like the song but don't want to buy the whole album then just buy the single track off the net or buy the single. You're just being greedy.

 

[Generator]

It's interesting to note that the software is also used by many emerging and indie artists to disseminate their music to a wider audience than would be possible using standard websites (cost would be the primary stumbling block with respect to running such a site-based service). Taking the stance that it is about protecting the artists' rights is far from being as powerful and clear-cut as some believe.

I was under the impression that, in Australia at least, cd sales had improved in recent years, even though filesharing has become increasingly common. Whether the act of downloading a particular file is legal or not, does the loss of revenue argument actually have a factual basis (that we are able to determine, anyway)?

 

[withoutaface]

Artists get a much larger cut from shows and merchandise anyway.

 

[Xayma]

The filesharing thing for music will always remain but I think it could be within the interests of the industry to release their own low quality versions quickly. Enough to be noticeable and to satisfy those who don't like it too much, but poor enough so that a CD offers quality. It could delay the release of higher quality versions if it is put out at the same time as the music.

 

[Riewe]

What i find funny though is that when figures showed that CD sales dropped somewhat in recent years, the record companies blame P2P. But the problem i see is that most of the mainstream music is absolute crap these days (besides the rare exception) So people aren't necessarily going to pay a fair bit amount of money fro the CDs, when dollar value is not there.

But on the other hand, look at DVD sales. They keep on saoring. Why? Because there are still great movies regularly coming out and the companies give people INCENTIVES to buy the dvd and not the pirated version by including extras and such. If record companies could do this, then they make get more money, but until then, the current trend will continue.

 

[malkin86]

Mother faces jail for child's music downloads

Geez, that's harsh.

Kazaa: Different from Grokster

There was a recent Australian ruling which begins to say that makers of P2P software are responsible that users use the software to do illegal things. The music industry reckons it's common sense. What do youse think?

 

[Serius]

haha! stick it to the man

lets all go and dl p2p apps and let people leech stuff off us and download lots of music in protest! tat will teach those greedy bastards