Friday, Jul 25, 2008
Did the record industry's court triumph insure a future full of profits -- or seal its doom? Experts weigh in.
Feb 12, 2001 | Although the Napster music-trading service is still breathing for now, most observers declare that the latest court decision spells imminent doom for the company. Now the question becomes, What next? Will Napster users flee to other file-trading networks? Or has the recording industry established its dominance over the new online world of music distribution once and for all? We asked our favorite suspects in the worlds of law, music and software for their opinions. Here's what they had to say.
Eben Moglen, professor of law, Columbia Law School
The record industry is about to discover that this was a terribly bad idea. The consequence of shutting down Napster -- whenever the injunction happens -- is that they will be on the cover of every major newsmagazine and 60 million people will again find out that you can share music online. They will also find out that Napster's servers have been replaced by the OpenNap -- a program that allows any computer anywhere to be a Napster server and help people share music.
In peer-to-peer file sharing, when the customer moves, the inventory moves with him. The entire Napster-using public is going to figure out that they don't need Napster to share files. The consequence is that the music industry will then discover that the lawsuit was the stupidest part of five years of stupidity.
It will discover that this lawsuit fully popularized, publicized, promoted and spurred the development of the very alternative distribution system that it was trying to eliminate. This is how the industry will have turned out to have participated in bringing about its own highly satisfactory and complete death.
Industry members will have created a situation that they can only control by going to war with their own customers. They've attempted to murder Napster, and they've actually shot themselves in the head. Self-murder or suicide, they're dead either way -- it's an untenable business strategy in the long run to be at war with your own customers. But shutting down Napster will give them no one to sue but the listeners. This is one of those rare, but nonetheless important, situations in which victory in a lawsuit is defeat in the world.
Whitney Broussard, attorney at Selverne, Mandelbaum & Mintz
It's an interesting decision. Ultimately what it says is that Napster has to disable access to files that it has specific notice of. That makes sense; it's about right. It's pretty much what the Digital Millennium Copyright Act says when it talks about safe harbors for online service providers. That seems to be what Napster has been doing with all the Metallica users -- if it is presented with a list of allegedly infringing files, as far as I know it's been blocking users.
What's more troubling are some of the statements about fair use. The decision makes rather broad statements about the consumer's lack of a right to make copies. It says that consumer use is commercial use because it's exploitative; that doesn't seem right to me. They also seem to imply that a user who is engaged in sampling -- downloading something to see if he wants to buy it and then deleting it thereafter -- isn't [engaging in] fair use, which I think a lot of scholars would disagree with. And they seem to be making the general assertion that consumers making copies of music for their own private noncommercial use is an infringement; they aren't talking about the fair-use aspects of that.
What happens next? I think it depends on what the U.S. Court of Appeals says, if it wants to take it on. If the Court of Appeals decides to take it "en banc" (i.e., instead of just three judges, they use the entire court of judges -- it's not common but it is for very serious cases), then we go back to where we were a few days ago, where probably the injunction will get stayed on some level and it will be Round 3 and they'll be going down all these arguments again.
If the Court of Appeals doesn't agree to take the case, I suppose they could appeal to the Supreme Court, which might or might not take it. But no matter what the court does it will be an unstable solution. It's difficult for courts to decide something like this; it probably needs to go to Congress.
Gene Hoffman, CEO of eMusic
The only place where the Court of Appeals disagreed with the U.S. District Court was the scope of the injunction itself. It denied all the defenses Napster put forth; the only thing it did say is instead of putting 100 percent of the burden on Napster, the plaintiffs need to share the burden by helping Napster identify the files.
What the Appeals Court is saying is that it's clear that Napster can make sure that surf results don't return for obvious infringing files, and all that the plaintiffs have to do is point out the infringing files and Napster has to make it happen. That's what we're planning to do. It's everything but an absolute slam-dunk. It changes the value of my company; it really invigorates and opens up an opportunity to serve all the customers that will be cut loose by Napster.
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