Music Industry Group Launches Legal Attack
Against File-Sharing
By BRUCE ORWALL and ETHAN SMITH
Staff Reporters of THE WALL STREET JOURNAL
The music industry on Monday unleashed a long-planned legal blitz intended to stanch the rampant piracy that has caused music sales to crater during the past four years.
The five major record companies, grouped under the banner of the Recording Industry Association of America, filed 261 lawsuits against individuals it says have illegally used file-sharing software to distribute vast troves of copyrighted music online, where it can be accessed and downloaded for free by music consumers.
The association characterized its actions as a "first wave" of what could ultimately be thousands of copyright infringement lawsuits against individuals who have distributed on average more than 1,000 music files each to other users. It also said it wouldn't sue those individuals who agree to voluntarily identify themselves and pledge to stop illegally sharing music over the Internet. "We hope that today's actions will convince doubters that we are serious about protecting our rights," said RIAA President Cary Sherman.
The lawsuits come four years after the Napster file-sharing service first created an easy way for listeners to share music online without paying for it. Halting attempts to stop the spread of such services have largely failed, leaving the industry with the unappealing prospect of suing consumers -- some of whom inevitably will turn out to be students or other people with sympathetic stories to tell.
Still, the industry feels like it has its back to the wall. Unit shipments of music have fallen 26% to 860 million last year from 1.16 billion units in 1999, while revenues are off by 14% to $12.6 billion in 2002. "Nobody likes playing the heavy," Mr. Sherman said. "But when your product is being regularly stolen, there comes a time when you have to take appropriate action."
The high-profile legal assault, which comes after more than a year of planning, is just one element of a multifront campaign to save the music business. Even as the industry aggressively targets illicit online swapping of music, it is angling to make amends with consumers.
Last week, Vivendi Universal SA's Universal Music Group, the world's largest record company, slashed CD prices in a bid to reinvigorate sales and respond to the longtime consumer complaint that CDs simply cost too much. The change will in many cases drop the retail price for new releases to $10 or less, but none of Universal's major rivals has yet matched the cuts.
--Martin Peers contributed to this article.
Write to Bruce Orwall at bruce.orwall@wsj.com3 and Ethan Smith at ethan.smith@wsj.com4
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Updated September 8, 2003 1:22 p.m. |
