The recording industry's legal assault on music file-swappers isa dramatic effort to survive after resisting online digitaldistribution, even as music fans grew increasingly disaffected withthe soaring cost of popular CDs.
Some observers say record companies now risk a backlash, whileothers contend the public has so little regard for the music labelsthat the lawsuits won't make a difference.
A day after firing off 261 copyright lawsuits, recordingindustry officials fielded a few calls from defendants eager toavoid paying thousands in damages. The Recording IndustryAssociation of America said the first was settled for $2,000 --with the mother of a 12-year-old defendant, Brianna LaHara of NewYork. Brianna was accused of downloading more than 1,000 songs fromKazaa, and the suit was derided Tuesday in tabloid headlines.
The effort by some to address their legal headache may bode wellfor the industry, but some observers and lawmakers questioned thetactic. Accounts emerged that some caught in the industry's piracynet were young children and seniors - hardly the perfect posterimage of a hard-core music pirate.
During a Senate Judiciary Hearing Tuesday, Sen. Dick Durbin,D-Ill., raised the issue of whether the industry was going too farwhile questioning Cary Sherman, president of the Recording IndustryAssociation of America.
"Are you headed to junior high schools to round up the usualsuspects?" Durbin asked Sherman.
Sherman told Durbin the industry is merely trying to convey themessage that sharing music is illegal. The RIAA plans another roundof lawsuits in about three weeks, officials said.
The accounts of those sued bolstered the view that music fans ofevery ilk have taken to downloading music directly to theircomputers as a preferred method of obtaining music.
The industry opted to go after individuals earlier this year,figuring music fans who prefer to get their music online now arebeginning to have viable options to do so legally through for-paymusic download services like Apple Computer Inc.'s iTunes MusicStore and Buy.com's BuyMusic.com.
But while iTunes has sold more than 10 million song downloadssince its April launch, no service has emerged for the largemajority of computer users on the Window platform. Most of thelegal offerings come with limited selection and restrictions onwhat fans can do with their music.
"The real hope here is that people will return to the recordstore," said Eric Garland, CEO of BigCampagne LLC, which trackspeer-to-peer Internet trends. "The biggest question is whethersingling out a handful of copyright infringers will invigoratebusiness or drive file-sharing further underground, further out ofreach."
There are signs some people have stopped file-sharing sinceJune, when the RIAA announced its lawsuit campaign, and also havemoved to other file-swapping networks perceived to be safer thanthe market leader, Kazaa.
Traffic on the FastTrack network, the conduit for Kazaa andGrokster users, declined over the summer and climbed again lastmonth, as has the number of people using less popular file-sharingsoftware like eDonkey, Garland said.
At the same time, a decline in CD sales worsened. Between June15 and Aug. 3, the decline in CD sales accelerated 54 percent, andas of Aug. 3, CD sales were down 9.4 percent over the same periodin 2002, according to the Yankee Group.
Just because a person stops file-sharing does not mean they willstart buying CDs and boost industry revenue, said Josh Bernoff, ananalyst with Forrester Research, Inc.
"Many of these individuals have gotten out of the habit ofbuying CDs," Bernoff said. "They think CDs are too expensive, theyonly want a couple of tracks on the CD."
The recording industry has been battling a three-year slump inCD sales that it blames squarely on the explosion of musicfile-sharing that first started when Napster surfaced in the late1990s. Record companies were successful in suing Napster out ofbusiness in 2001, but have not had similar victories against moreelusive and prolific successors, including Kazaa, Morpheus andGrokster.
Universal Music Group announced last week it would slash thewholesale price of its CDs and recommend retailers sell them for$12.98 from $18.98.
The price cut was an olive branch to music fans, many who havealready been soured on the industry because of practices that keptCD prices artificially high. The industry settled a lawsuit with 43states last year who had accused the recording companies ofconspiring in the 1990s to set a minimum price for CDs.
None of the other major recording companies have followedUniversal.
"You're not going to see legitimate services rise up to replacethe rapid decline we've seen in CD sales," said Lee Black, senioranalyst with Jupiter Research. "We'll continue to see a drop in theCD market."
Bernoff said consumers already think so little of the musiccompanies, that the lawsuits likely won't make much of adifference.
"The industry has been backed into a corner, and their image isso bad, the lawsuits are not going to be much of a problem," hesaid.
Read More
Three Air Jam teams take home the win
October 12, 2012Nineteen teams shimmied, shook and flipped for a sold out John R. Emens Auditorium on Thursday night during the 25th annual Air Jam.
Bill Clinton Speaks at North Central High School
October 12, 2012Former President's Speech Could Have Effect on State Senate Race
