[NetBehaviour] U.S. Supreme Court Rules Against P2P

marc marc.garrett at furtherfield.org
Mon Jun 27 18:06:29 CEST 2005

*U.S. Supreme Court Rules Against P2P*
By Nate Mook and Ed Oswald, BetaNews
June 27, 2005, 11:05 AM

In a long-awaited decision that could have stark repercussions for P2P 
networks, the United States Supreme Court on Monday gave record labels 
and movie studios a green light to sue file-sharing services such as 
Grokster and Morpheus, which maintained they were not responsible for 
the actions of their users.

The Court rejected arguments saying such lawsuits could quell the spread 
and growth of new digital video and audio devices, instead siding with 
companies holding the rights to copyrighted work.

"We hold that one who distributes a device with the object of promoting 
its use to infringe copyright, as shown by the clear expression or other 
affirmative steps taken to foster infringement, is liable for the 
resulting acts of infringement by third parties," Justice David H. 
Souter wrote in the majority opinion.

The ruling means that the case against Grokster is sent back to the 
lower court, which had previously ruled that file sharing companies 
could not be held liable for copyright infringement. According to the 
Supreme Court, there is enough evidence for the case to go to trial.

Grokster and StreamCast Networks were relying on the Supreme Court's 
1984 Betamax ruling that stated Sony could not be sued over customers 
using VCRs to record copyrighted content illegally. Justice Souter said 
there was a key difference in the way file sharing companies marketed 
their products and whether they took steps to reduce infringement.

"There is substantial evidence in MGM's favor on all elements of 
inducement," Souter wrote.


*The False Mathematics of the RIAA*

First, let's consider what actual P2P losses are to the industry.

They are much more difficult to calculate than the RIAA would have you 
believe. Why? First, downloaders pull songs they would never buy; I have 
Outkast's "Hey Ya" somewhere; I consider it a goofy novelty song, and 
the only reason I have it is that someone else sync'ed it to a Peanuts 
animation (everyone on stage dancing to Schroder's piano). It was an 
amusing but unauthorized use, which I downloaded, smiled at, and never 
saw again.

Oh ya: The CD that song came from -- OutKast's 2003's release, 
Speakerboxxx/The Love Below -- sold 10-million plus copies.

"The Napster to Go model . . . shows that the RIAAs claims of a lost 
sale for every download to be demonstrably false. If you can download an 
unlimited number of songs via napster and play them for as long as you 
continue to subscribe, then the maximum loss the RIAA suffers from a 
single downloader cannot exceed $15/month no matter how many songs a 
person downloads."  -- via boingboing

Over the course of 10 years, that represents total gross losses of 
$1,800, of which Napster keeps between 15 and 20%. Net loss: $1,500 dollars.

But wait, there's more:  The Rhapsody Music Subscription from Real 
Networks charges only $10 per month. That's $120 per year. Over a 
decade, the loss downloaders present to the industry by not  signing up 
for Rhapsody are: lost revenue of $1,200 (gross). In other words, the 
total net industry  losses are ~$1,000 per decade. Hardly as apocalyptic 
as portrayed.

more again...

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