[Dixielandjazz] Online Music Piracy Lawsuit Update

[Stephen G Barbone]

 From the Wall Street Journal.
Music Industry to Abandon Mass Suits
By SARAH MCBRIDE and ETHAN SMITH
After years of suing thousands of people for allegedly stealing music  
via the Internet, the recording industry is set to drop its legal  
assault as it searches for more effective ways to combat online music  
piracy.

The decision represents an abrupt shift of strategy for the industry,  
which has opened legal proceedings against about 35,000 people since  
2003. Critics say the legal offensive ultimately did little to stem  
the tide of illegally downloaded music. And it created a public- 
relations disaster for the industry, whose lawsuits targeted, among  
others, several single mothers, a dead person and a 13-year-old girl.

Instead, the Recording Industry Association of America said it plans  
to try an approach that relies on the cooperation of Internet-service  
providers. The trade group said it has hashed out preliminary  
agreements with major ISPs under which it will send an email to the  
provider when it finds a provider's customers making music available  
online for others to take.

Depending on the agreement, the ISP will either forward the note to  
customers, or alert customers that they appear to be uploading music  
illegally, and ask them to stop. If the customers continue the file- 
sharing, they will get one or two more emails, perhaps accompanied by  
slower service from the provider. Finally, the ISP may cut off their  
access altogether.

The RIAA said it has agreements in principle with some ISPs, but  
declined to say which ones. But ISPs, which are increasingly cutting  
content deals of their own with entertainment companies, may have more  
incentive to work with the music labels now than in previous years.

The new approach dispenses with one of the most contentious parts of  
the lawsuit strategy, which involved filing lawsuits requiring ISPs to  
disclose the identities of file sharers. Under the new strategy, the  
RIAA would forward its emails to the ISPs without demanding to know  
the customers' identity.

Though the industry group is reserving the right to sue people who are  
particularly heavy file sharers, or who ignore repeated warnings, it  
expects its lawsuits to decline to a trickle. The group stopped filing  
mass lawsuits early this fall.

It isn't clear that the new strategy will work or how effective the  
collaboration with the ISPs will be. "There isn't any silver-bullet  
anti-piracy solution," said Eric Garland, president of BigChampagne  
LLC, a piracy consulting company.

Mr. Garland said he likes the idea of a solution that works more with  
consumers. In the years since the RIAA began its mass legal action,  
"It has become abundantly clear that the carrot is far more important  
than the stick." Indeed, many in the music industry felt the lawsuits  
had outlived their usefulness.

"I'd give them credit for stopping what they've already been doing  
because it's been so destructive," said Brian Toder, who represents a  
Minnesota mother involved in a high-profile file-sharing case. But his  
client isn't off the hook. The RIAA said it plans to continue with  
outstanding lawsuits.

Over the summer, New York State Attorney General Andrew Cuomo began  
brokering an agreement between the recording industry and the ISPs  
that would address both sides' piracy concerns. "We wanted to end the  
litigation," said Steven Cohen, Mr. Cuomo's chief of staff. "It's not  
helpful."

As the RIAA worked to cut deals with individual ISPs, Mr. Cuomo's  
office started working on a broader plan under which major ISPs would  
agree to work to prevent illegal file-sharing.

The RIAA believes the new strategy will reach more people, which  
itself is a deterrent. "Part of the issue with infringement is for  
people to be aware that their actions are not anonymous," said Mitch  
Bainwol, the group's chairman.

Mr. Bainwol said that while he thought the litigation had been  
effective in some regards, new methods were now available to the  
industry. "Over the course of five years, the marketplace has  
changed," he said in an interview. Litigation, he said, was successful  
in raising the public's awareness that file-sharing is illegal, but  
now he wants to try a strategy he thinks could prove more successful.

The RIAA says piracy would have been even worse without the lawsuits.  
Citing data from consulting firm NPD Group Inc., the industry says the  
percentage of Internet users who download music over the Internet has  
remained fairly constant, hovering around 19% over the past few years.  
However, the volume of music files shared over the Internet has grown  
steadily.

Meanwhile, music sales continue to fall. In 2003, the industry sold  
656 million albums. In 2007, the number fell to 500 million CDs and  
digital albums, plus 844 million paid individual song downloads --  
hardly enough to make up the decline in album sales.

—Amol Sharma contributed to this article.
Write to Sarah McBride at sarah.mcbride at wsj.com and Ethan Smith atethan.smith at wsj.com