Landmark Supreme Court Ruling Not Helping Piracy Fight Walaika K. Haskins, newsfactor.com
http://news.yahoo.com/s/nf/20060705/tc_nf/44273 A year ago, when the Supreme Court ruled against Grokster and gave the recording and motion picture industries greater power to sue over illegally shared copyrighted music and movies, file-sharing software seemed destined for the recycle bin. The recording industry claimed at the time that the decision laid the groundwork for the dawn of a new era. "We will no longer have to compete with thieves in the night whose businesses are built on larceny," proclaimed Sony BMG CEO Andrew Lack. Yet one year after the Supreme Court's decision, file-sharing networks are alive and well, and statistics show their membership is growing. Faulty Predictions After the court ruling, several file-sharing companies said they would change their illegal ways and begin to abide by the law. In fact, Sam Yagan, chief executive of MetaMachine, the company that developed the eDonkey service, told a Senate committee that his company would reform rather than deal with the threat of litigation in the wake of the Grokster decision. But while certain peer-to-peer (P2P) operators hit the delete button and shut down or turned legitimate, others, including LimeWire, Morpheus, and Kazaa, have kept their doors open for business. According to BigChampagne, a company that tracks file-sharing activities, there was an average of 9.7 million simultaneous file-sharing users at any given time during May, including 6.7 million users in the U.S. alone. Those figures, according to the company, represent an increase of about one million users worldwide over the same period last year. Despite these and other stats, RIAA Chief Executive Mitch Bainwol claimed in June that unauthorized music-swapping had been contained. "The problem has not been eliminated," Bainwol was quoted in a USA Today article as saying. "But we believe digital downloads have emerged into a growing, thriving business, and file-trading is flat." Spin Masters In contrast to the positive spin the recording industry is placing on its antipiracy initiatives, Frost & Sullivan analyst Mukul Krishna said he thinks the RIAA and the Justice Department seemed to have lost a lot of the momentum generated by the Grokster ruling. As a result, he said, a growing number of people have started going back to P2P services. "It has been surprising that the steam that was there from [the RIAA] and the Feds has run out," Krishna said. "We were expecting to see much more high-profile [activity], and seeing P2P networks start toeing the line, but that really hasn't happened." Because songs and movies are free on file-sharing networks, it is a lure that almost irresistible to young people that make up the bulk of P2P users, said Paul Jackson, a Forrester analyst. "There is always a core -- typically young people, possibly students -- that will try to get something for nothing," Jackson said. Something for Nothin' Nitin Gupta, a Yankee Group analyst, offered a similar take, noting that it is difficult for any business to compete with free alternatives. Content makers, he said, should "focus on creating new business models" that allow music listeners to discover and share music in a way that generates revenue and does not cannibalize CD sales. One of these ways is of course iTunes, which is reported to have sold more than one billion tracks to date. However, a recent study by Frost & Sullivan found that fewer than one in 100 tracks loaded on an iPod is a download from the iTunes music store. "Younger people will look for anything that is free because they don't have credit cards or always want to get parental consent," Krishna said. Reply with a "Thank you" if you liked this post. _____________________________ MEDIANEWS mailing list medianews@twiar.org To unsubscribe send an email to: [EMAIL PROTECTED]
