Label:Life

The US Supreme Court has handed movie studios and record labels a sweeping victory against file swapping, ruling that peer-to-peer companies such as Grokster could be held responsible for the copyright piracy on their networks.

In a unanimous decision issued on Monday, the nine justices said companies that build businesses with the active intent of encouraging copyright infringement should be held liable for their customers’ illegal actions.

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

The decision comes as a surprisingly strong victory for copyright companies and stands to reshape an internet landscape in which file swapping has become commonplace. [more @ www.silicon.com]

As Hollywood and record labels cheered Monday’s Supreme Court decision in the MGM v. Grokster case, technology companies and consumer groups warned that the ruling will chill innovation and result in more gadget-killing lawsuits.

In a unanimous ruling, the justices said that Grokster and StreamCast Networks, the company behind the Morpheus network, can be held liable for copyright infringement if they encourage customers to illegally share copyright movies and music. The Supreme Court returned the case to the district court where the two software companies will be tried for inducing infringement.

But while entertainment companies touted the victory as a crystal clear decision about right and wrong business practices, technology groups said they are left with a murky, unclear standard of what it means for a company to encourage, or induce, its customers to infringe copyright, and this will lead to more litigation. [more @ www.wired.com]

Should software companies be responsible if their technology is used to illegally swap music and movies?

According to a new ruling by the US Supreme Court, firms can now be blamed when their file-sharing networks help people illegally swap copyrighted material.

The case was brought to court by 28 of the world’s largest entertainment firms.

What do you think of the ruling? Was the right decision reached? How will it affect the industries concerned?

The following comments reflect the balance of opinion we [The BBC] have received so far: [Read on. Makes very interesting reading. -Ed]
[more @ www.bbc.co.uk]

Piracy of music compact discs held steady last year due to efforts by countries such as Mexico and Brazil to crack down on illegal sales and seize counterfeiting factories, an industry group said.

The global value of the pirate music market was $4.6 billion in 2004 compared with $4.5 billion a year earlier, the International Federation of the Phonographic Industry said in an e-mailed statement today. The number of pirated CDs increased 2 percent last year, the smallest increase in five years, to 1.2 billion CDs, said the industry group, which represents such companies as EMI Group Plc and Warner Music Group Corp. [more @ www.bloomberg.com]

One in three music discs sold worldwide, “is an illegal copy, creating a US$4.6 billion music pirate market that destroys jobs, kills investment and funds organized crime”.

So says the Big Four record label cartel’s IFPI (International Federation of Phonographic Industry) in its Commercial Piracy Report 2005.

It is, of course, manifestly impossible for the IFPI to accurately gauge the extent to which counterfeits may or, as seems inreasingly more likely, may not be affecting the music industry’s indecently fat bottom line. In fact, the report should have been released under the Fiction category, as with all other IFPI ‘studies’

“A total of 1.2 billion pirate music discs were sold in 2004,” says the IFPI, failing to explain how it arrives at this figure.

However, given that the various entertainment and software cartel companies seem to use the same creative accounting techniques, it’s reasonable to conclude the IFPI does the same. [more @ www.mp3newswire.net]

Music stars including rapper Jay-Z and singer Sheryl Crow have welcomed a court ruling allowing record companies to sue illegal file-sharing firms.

Jay-Z called the US Supreme Court’s decision a “great victory” for those who “make their living through the creative process”.

The surprise ruling could start a legal assault on the creators of file-sharing networks such as Morpheus.

But some artists said it could stifle their online career development. [more @ www.bbc.co.uk]

East West Records, one of Warner Music Group’s (NYSE: WMG) newest label groups, announced today an exclusive, multi-year deal with London and New York-based Lizard King Records.

Founded in 2002 and chaired by Martin Heath, Lizard King is a full-service record company established to reflect the growing musical connection between the U.S. and UK. The label has produced records by garage rock outfits The Go, Clear Static and the multi-platinum selling band, The Killers, which was Lizard King’s second signing.

Under the completed agreement, East West, a label designed to support emerging rock artists, will provide full promotion, marketing, distribution and sales services to future Lizard King releases in the U.S. East West affiliated labels are distributed by the Alternative Distribution Alliance, WMG’s distributor of independent record labels. Outside of the U.S., Lizard King will continue to be distributed by its network of licensees and distributors.
[more @ www.marketwire.com]

Having established a haven for rock artists, Sanctuary Music Group, one of Britain’s best-known and hitherto most successful music companies, will this week mount a fight to restore its financial health.

The company, whose clients include Elton John, Guns ’n’ Roses and BeyoncE, is tomorrow holding a board meeting to discuss options, including an emergency rights issue and an acceleration of efforts to find an external investor or buyer.

The heat is on because the City believes Sanctuary is struggling to avoid breaching its banking covenants. [more @ www.timesonline.co.uk]

A pan-European music retail organisation has called on the record labels to end their pre-release exclusives with download platforms.

GERA-Europe, which represents the interests of several major entertainment retailers, told a recent meeting of the International Federation of the Phonographic Industry that digital outlets account for just 3% of total music sales, and that it was therefore unfair to give them the advantage of being able to sell major releases before they are on sale on the high street.

Of particular concern was EMI’s deal with iTunes which saw Coldplay’s single ‘Speed Of Sound’ available via the Apple platform weeks before it reached record shops. [more @ www.cmumusicnetwork.co.uk]

Ringtones, those song snippets that announce incoming mobile-phone calls, are now making noise at the top of the pop charts and on the bottom line of multibillion-dollar businesses.

Ringtones have emerged as a promising source of revenue for music publishers and record labels still struggling to connect with a generation used to getting music for free through Internet “peer to peer” services. Ringtone sales topped $4 billion worldwide in 2004 and $300 million in the United States, according to the market-research firm Consect.

While download services like Apple Computer Inc.’s iTunes seem to have settled on a standard price of 99 cents per song, ringtone sellers can charge two to three times as much for a 15-second snippet.

“This is not a fad that will go away in the next year or so,” said Thomas Hesse, president of global digital business at Sony BMG Music Entertainment. [more @ www.reuters.co.uk]