Music After Grokster vs. MGM
Musicians and music companies deserve to get paid for their work, so I support that part of the outcome. But I am concerned that it could slow the path of innovation.
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In the majority opinion, written by Justice David Souter, the court said, “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 by third parties.” The case now goes back to a lower court, which will decide whether the services have in fact encouraged copyright infringement.
The decision is a big departure from the status quo, in which technology companies largely felt protected by the 1984 Betamax ruling that said technology that had “substantial non-infringing uses” (such as “time-shifting” television programs) was legal. However, the Grokster case is “significantly different” from the Betamax case, the court said, because of evidence that the file-sharing sites were seeking “to cause and profit from” copyright infringement by their customers.
MGM, the Motion Picture Association of America (MPAA), as well as all the music and movie studios are the winners. Grokster and the other file-sharing services are the losers, and I wouldn’t be surprised if they shut down almost immediately. Since the Internet is global, other non-U.S. services might continue to exist but with limits on their ability to promote to U.S. consumers and advertisers.)
I expect this ruling to be a boost for the legal music download and streaming sites, such as iTunes, Napster, Rhapsody, and MusicMatch. And it may help the peer-to-peer services that say they are legal, such as Mercora, and Wurld Media. But companies that introduce new technology will have to be careful not to promote uses that infringe copyrights. Already, we see very few products that distribute DVDs throughout the home because that breaks the DVD copy-protection scheme, which is a violation of the Digital Millennium Copyright Act. Now, it will be much harder for anyone to introduce a video version of the iPod.
