Today We Learn About: The Development of Copyright Law

There was once a website that gave the user access to nearly every album ever recorded. These albums were available in all file formats, and they were free. The site had over 180,000 users, was easy to search, and housed a thriving community of music lovers. In October 2007 this site went offline. Word of mouth spreads fast on the internet and before too long it became clear that site administrator for Oink.cd, as the site in question was called, had been arrested by an International Federation of the Phonographic Industry task force for suspicion of conspiracy to defraud and infringement of copyright law.1 News of this arrest surprised few since the site allowed users to connect their computers to the computers of other music fans in order to download the files housed on these remote computers. The site acted as Google does, allowing users to search for the music they desired. This activity made copyright infringement easy, and the site’s closure was inevitable.

Within days of the disappearance of Oink.cd, two brand new sites with similar goals arrived on the internet. They both sought to replace Oink, and as of this writing one of them is far larger than Oink could have dreamed. This new site was recently written about on a popular tech blog, where it was referred to Site X. Site X currently has 735,052 albums available for download, which is the largest collection of music on the internet that is freely available for download.

This is the world of bittorrent and peer-to-peer (P2P) file sharing. The sites in question are known as trackers, and the best of the best are invite-only. In order to become a member you must know someone who is already a member. Private, invite-only trackers provide top quality content at fast download speeds. They range from general trackers that provide all manners of digital content, to specialized music only, movie only, television only, and even sport specific trackers. In contrast to public trackers like ThePirateBay.org, private trackers are harder for authorities to trace because of the security measures users take, and the invite system in place to ensure that only legitimate users gain entry.

On the other side of this equation are groups that represent artist rights and the interests of copyright holders. In the United States, The Recording Industry Association of America represents the rights of copyright holders and instigate investigations into alleged acts of piracy. The organizations stated goals are as follows,

The RIAA is an organization committed to helping the music business thrive. Our goal is to foster a business and legal climate that protects the ability of our members – the record companies that create, manufacture and/or distribute some 85 percent of all legitimate sound recordings produced and sold in the United States – to invest in the next generation of music. In support of this mission, we work to protect intellectual property rights worldwide and the First Amendment rights of artists; conduct consumer, industry and technical research; and monitor and review state and federal laws, regulations and policies.”2

Since the fight against P2P piracy began with the downfall of Napster, the RIAA has been active in bringing piracy to an end through various means including litigation, education, advertising campaigns, and consumer-artist outreach.

The nature of the internet creates problems for those who fight piracy. Since there are no borders, a new organization has been created called the International Federation of the Phonographic Industry. Similar to the RIAA, this group represents the recording industry worldwide with some 1400 members in 66 countries and affiliated industry associations in 45 countries.3 The IFPI’s most notable and successful campaign was their long-fought battle in conjunction with another smaller artist rights organization against ThePirateBay.org. A Dutch court ruled that ThePirateBay.org must remove a list of infringing files from the site, and block Dutch users. This was seen as a large victory, as ThePirateBay.org is the largest public bittorrent tracker in the world, but since this ruling was handed down the site has moved their servers to another locations and made no change the access that users are given.

The goal of the RIAA and IFPI is the eradication of piracy. Since a large majority of piracy occurs though digital means (as opposed to counterfeit CDs), the RIAA and IFPI have fought against purveyors of online piracy and supported legal means of digital distribution such as iTunes, Rhapsody, emusic, and AmazonMP3. Of these, iTunes is by far the most successful and will serve as the example. Digital sales have risen 12% from 2008 to 2009. This continues an upward trend in digital sales that began with the advent of online music stores.4 To the uninitiated, this rise in digital sales may lead to the conclusion that digital piracy will fall as music is made available online. This is false because online music retailers, namely iTunes, offer an inferior product in an inferior file format. Private trackers allow users to download music in nearly any format, including lossless formats like FLAC and popular lossy formats like mp3. Beyond the difference in audio fidelity, iTunes also attaches software to each track that is downloaded. This is called DRM, or digital rights management. DRM makes downloaded files unable to be freely transitioned between mp3 playing devices, computers, and blank cds which greatly inhibits listeners from using their music as they see fit. Present in the solutions of artist rights organizations are greater problems that, in the end, could easily lead individuals to piracy.

The United States Supreme Court ruled in 2005 that the providers of software that was designed to enable file-sharing of copyrighted works may be held liable for the copyright infringement that takes place using that software. The Court held 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.”5 By ruling as such, the Court greatly reduced the means for companies to distribute software that facilitated file-sharing. The is similar to the ruling against Napster that was handed down by the Ninth Circuit Court of California in 2001. By knowingly providing users with the means of infringement, software companies can be held responsible for this infringement.

In addition to the prosecution of those who facilitate infringement, the United States has also begun litigating individuals in a campaign that began in September of 2003 at the direction of the RIAA. According to the Electronic Frontier Foundation, the recording industry has now filed, settled, or threatened legal actions against well over 28,000 individuals.6 These cases have had a variety of outcomes, but they usually end with users paying the RIAA a designated payment per-song downloaded and distributed. This course of action has had mixed results as the RIAA has gotten more brazen in their litigation strategies. By bringing suits to court with little evidence, the RIAA has left themselves open to counter-litigation as was the case in Capitol v. Foster.7 The Court examined the claims of copyright infringement and noted that there were no facts presented to support the claim. The RIAA came up with several similar cases where attorney fees were not granted. The judge, however, did not think them relevant and awarded attorney fees to the accused. Some of the rationale was based on the the tactic of presenting a weak or unreasonable claim hoping to pressure the defendant into settling.8

The first individual prosecuted for illegal file-sharing in the United Kingdom was twenty-six year old Alan Ellis, the system administrator of Oink.cd. Unlike the infringement cases that took place in the United States, the U.K. Has had no success in their litigation, as Ellis was found innocent of conspiracy to defraud. This landmark ruling is in specific contrast to decisions in the United States, in that the individual who allowed copyright infringement to take place was found to not be responsible for the actions of those who frequent his site. The precedent set in the case leaves the door open for similar sites to be run from the shores of the United Kingdom. The fact that the site was removed from the internet is of little consequence considering the immediate proliferation of similar websites upon the demise of Oink.cd. There have been no further cases of litigation against individuals who participate in copyright infringement in the United Kingdom. This is also a stark contrast to the United States, where many citizens were charged with crimes related to file-sharing.

The fact that the United States has chosen to prosecute software companies and users for copyright infringement, but not torrent trackers while the United Kingdom has only prosecuted torrent trackers makes sense. Copyright infringement is currently seen as a global problem, and as the internet is the primary means of distribution it stands to reason that a variety of government entities will approach the situation with a variety of possible solutions in order to find the most effective means to eradicate the problem. The rulings in the United States regarding software that facilitates copyright infringement would surely hold up in the United Kingdom, as both countries are parties to the World Intellectual Property Organization Copyright Treaty.9 It is almost as if there is a process taking place that seeks to eliminate unsuccessful means of litigation in order to find and exploit the single most effective means of prosecuting copyright infringement as it takes place in the digital age. Global cooperation will be necessary to achieve these means, but at a cost to consumers and the music industry.

Piracy cannot be eradicated. It can be fought with mild success, but it will never be extinguished. This is evident in the ever-sprouting world of private bittorrent trackers and the growing numbers of users that frequent these sites. The music industry is making a mistake in focusing their energies in fighting against the development of new technology. Throughout the history of recorded music, advancements have been made in the method of delivery. According to Wikipedia, there have been forty-four new methods of delivery developed since 1877.10 The phonograph cylinder, vinyl record, 8-track, cassette, and CD are the formats of note. The newest method of delivery is the mp3, which also happens to be the one format that the music industry has refused to embrace. With each successive innovation, record companies have shifted their focus to accommodate technology and yet this has suddenly changed. There are repeated reports from artist rights organizations reporting the decline in CD sales as if this is not to be expected.11 The sale of cassette tapes also dropped significantly once CDs were introduced to the market. When CD players became affordable they were put in cars, and the same process is taking place as more cars are now offered with an auxiliary input to accommodate an iPod. Yet the music industry is still slow to fully embrace the mp3 and abandon the CD. As further evidence of a shifting taste amongst consumers, it is wise to note the dramatic increase in vinyl sales in 2009. This often unmentioned fact suggests that those who buy music are moving forward in their use of technology, so far forward that they have circled back to vinyl.12

Beyond taking steps to fully embrace digital distribution, the recording industry should alter the technology that is currently in place in order to provide consumers with the product that is delivered through currently illegal means. That is, record labels need to offer consumers high quality audio, in a variety of formats, with no restrictive software. With nearly all releases available on illegal bittorrent trackers in any number of formats, labels stand to lose nothing in making their releases available in similar formats through legal channels. Furthermore, taking this step would have no impact on the enforcement of copyright law, as users will still be required to purchase a license when they buy the tracks.

While altering and exploiting opportunities for legal digital access to music, record labels small and large should pay attention to the opportunities presented by bittorrent trackers by way of free promotion. As an example, we take Open Your Eyes Records. This label is a very small outfit, having only released two albums. Their latest release in December of 2008 was accompanied by a partnership with the aforementioned “Site X,” the largest private, music-specific bittorrent tracker on the internet. The tracker announced the release of the labels newest record, by a band named I Call Fives, and encouraged users to download the release. The label was the first to publicly partner with a bittorrent tracker for exclusive pre-release leaks of albums. In addition, the label made their release available in the highest quality possible. Going one step further, Open Your Eyes Records offered the instrumental and vocal tracks from the album available for free download as well. This first of its kind partnership was quickly picked up by multiple news agencies131415 and it brought actual success to the label and to the band alike. As co-owner of Open Your Eyes Records, this writer is in a situation to comment on the monetary success of the partnership. In 2009, Open Your Eyes Records not only fully recouped the cost of recording the album in less than a year (which is almost unheard of for a band’s first release), but we saw profits of over one hundred percent. This all stems from the promotion garnered from a partnership with a site that gave away over twenty-eight thousand copies of the record, and nothing else beyond the band’s touring schedule. The album continues to sell very well, selling over one thousand units per month since its release. The band in question, I Call Fives, was subsequently approached by a notable entertainment attorney who expressed interest in representing the band and they retain his counsel to this day. He is a user of the private bittorrent site and would not have heard of them otherwise. The band regularly sells records in all worldwide markets. The success that they have gained from giving away their album for free is not merely monetary, but also professional. Having retained the band to a management contract this writer is proud to say that the band has recently signed with nationally distributed No Sleep Records, and has been added to the roster of Black Iris Booking Agency. All of this would not have been possible if not for the promotion that was gained in giving away their debut release.

The United States and the United Kingdom have had differing experiences with copyright enforcement as it applies to the music industry. Trans-National record labels operating on both shores are seeking to bring an end to piracy, and stamp out the affects of infringement while ignoring the possible promotional benefits that exist. All the while presenting press releases to the public that misrepresent piracy in order to guilt the reader into ceasing their actions. Downloading music illegally is surely wrong, but it is not akin to stealing a purse or a CD from a store. Piracy consists of making a copy of an intangible piece of data, not stealing a physical product. This distinction might be small to some, but it serves to illustrate the attitude of the recording industry who laments at the death of the music industry. This attitude and assumption is part of the problem, not the solution. The music industry is not dying, the record industry is dying. New technology is taking over and driving the dominate means of physical distribution into the ground. Vinyl sales are at their highest since 1991, and of the top ten grossing concert tours of all time, eight occurred within the last five years.16 The music industry is in trouble, but not because of illegal downloading. Countries around the world continue to ignore the reality of their situation, prosecuting music lovers with frivolous outcomes in order to put a halt to the future of the industry. Only in embracing technology and significantly altering the administration and application of copyright law can the wounds that have been opened be healed. The United States and the United Kingdom may have taken separate paths on the road toward curbing piracy, but this is of little good when the road they travel is paved with an antiquated business model, lined with laws that hold back the development and proliferation of new technology.

1Cops Crash Invite-Only BitTorrent Network – http://www.theregister.co.uk/2007/10/23/oink_raids/

2RIAA – Frequently Asked Questions – http://www.riaa.com/faq.php

4Resources – IFPI publishes Digital Music Report 2010 – http://www.ifpi.org/content/section_resources/dmr2010.html

5U.S. Copyright Office – MGM Studios v Grokster – http://www.copyright.gov/docs/mgm/

6RIAA v. The People | Electronic Frontier Foundation – http://www.eff.org/riaa-v-people

7Capitol v. Foster – Not Reported in F.Supp.2d, 2007 WL 1028532 (W.D.Okla.), 2007 Copr.L.Dec. P 29,345, 86 U.S.P.Q.2d 1203

8Tech Law Prof Blog: April 22, 2007 – April 28, 2007 – http://lawprofessors.typepad.com/tech_law_prof/2007/week17/index.html

9Treaties and Contracting Parties: WIPO Copyright Treaty (WCT) – http://www.wipo.int/treaties/en/ip/wct/index.html

11Resources – IFPI Publishes Digital Music Report 2010 – http://www.ifpi.org/content/section_resources/dmr2010.html

12Vinyl Record Sales Soar to New Peak >> Synthtopia – http://www.synthtopia.com/content/2009/11/12/vinyl-record-sales-soar-to-new-peak/

14What.CD and Open Your Eyes Records Partner for Exclusive Pre-Releases – http://www.myuzk.com/whatcd-and-open-your-eyes-records-partner-for-exclusive-pre-releases/

15Record Label Partners With What.CD to ‘Revolutionize Industry Landscape’ – http://www.zeropaid.com/news/9930/record_label_partners_with_whatcd_to_revolutionize_industry_landscape/

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