NEWS

  /  

September 30, 2005

Congress to crack down on file sharing

WASHINGTON—Congress brainstormed ways to rein in peer-to-peer file sharing Wednesday, September 28, which was their first such effort since a unanimous Supreme Court found two peer-to-peer networks liable for damages caused by pirated music and movies sent through them.

The Supreme Court ruled in June that the file-sharing services Grokster and StreamCast were at fault because their software, used by millions of people, "induced" billions of songs to be swapped illegally each month.

The decision, in theory, opened the floodgate for suits against peer-to-peer networks, though it is too early to tell what effect the ruling will have.

The University, which does not have a file-sharing deal, has banned peer-to-peer networks since 1999. It enforces this ban by placing major bandwidth restrictions on computers, making a three-minute song take up to three days to download, according to Greg Jackson, vice president and chief information officer of the University.

But students at the University—and people on shared wireless connections anywhere—can rip music from other individuals' libraries using software like GetTunes.

Much of the Senate Judiciary Committee hearing focused on whether the courts or Congress should set rules and enforce consequences for Internet piracy.

Mary Beth Peters, the U.S. Register of Copyrights, told the committee that it should allow the Supreme Court decision to trickle down through lower court cases before considering legislation.

Peters said a long-term solution would come from both Congress and the courts. Stronger laws would help the court system better prosecute media thieves, she said.

Despite the Supreme Court's decision, peer-to-peer networks are continuing to grow, said Sen. Dianne Feinstein, D-California. "That sends a strong message," she said. "We should enact a strong law to protect our entertainment industries."

Feinstein is especially worried about Internet piracy because her state includes Los Angeles, the world capital of entertainment. She said file-swappers, who are smart and act rationally, have not been deterred from piracy because the consequences are not yet steep enough. The industry has filed lawsuits against a few people who have swapped large numbers of files.

"They know what the liability is, and they take the chance," Feinstein said. "If we don't stop it, it's going to destroy the intellectual property industries."

Sen. Arlen Specter, R-Pa., the committee chair, said the Supreme Court did not send a clear message to the record industry and media pirates, as the decision included two concurring opinions.

"I hope a new chief justice will stop the proliferation of new concurring opinions so we have a good idea of what the law is," said Specter, who oversaw the confirmation hearings for John Roberts, confirmed as chief justice Thursday.

Music and movie purchases have dwindled over the last decade, with entertainment sales falling from $15 billion in 1999 to $12 billion in 2004, said Cary Sherman, president of the Recording Industry Association of America.

Sherman attributed this drop to consumers—especially high school and college students—who increasingly pirate media that had previously been purchased.

Sherman said almost 70 universities—a threefold increase from last year—have media-sharing deals in which they pay a uniform fee to allow all students to download copyrighted files.

"The decision in Grokster has played a major role in this growing trend, focusing attention on the issue of illegal file sharing and providing school administrators with undeniable moral and legal clarity," he said.

Over the past three years, legal Websites for downloading music have gained popularity, including Apple's iTunes, Real Networks' Rhapsody, Napster, Ruckus, Walmart, and Yahoo. In March 2005, 26 million songs were purchased from digital-music stores in the U.S., according to NPD MusicWatch Digital Service.

Some technology experts are not sure that peer-to-peer networks are to blame for declining entertainment industry revenues. Gary Shapiro, president of the Consumer Electronics Association, told the Senate committee that much of the pirated music and movies wouldn't otherwise be purchased.

Young people are using downloaded materials to synthesize new forms of art in "unpredictively creative ways," Shapiro said, adding that overly broad legislation against file-sharing would undermine imagination.

"Our national creativity can no longer be judged by CD sales," he said. "Now is not the time to chill American ingenuity."