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Kazaa to pay record groups $100m
MSNBC.com
Kazaa to pay record groups $100m
By Joshua Chaffin in New York and Andrew Edgecliffe-Johnson in London
Financial Times
Updated: 9:11 a.m. ET July 27, 2006
The record industry on Thursday said it had reached a legal settlement with Kazaa, a popular peer-to-peer file-sharing service that is considered a major contributor to piracy.
The deal represents one of the biggest legal victories for the recording industry in its efforts to fight piracy.
Under the terms of the settlement, Sharman Networks, Kazaa's Australian-based owner, will pay the world's four major music companies - Universal Music, Sony BMG, EMI and Warner Music - more than $100m in damages.
In addition, Kazaa has also agreed to restrict the sharing of copyrighted material on its network.
"Kazaa was an international engine of copyright theft which damaged the whole music sector and hampered our industry's efforts to grow a legitimate digital business," said John Kennedy, head of the International Federation of the Phonographic Industry (IFPI), in a statement.
"It has paid a heavy price for its past activities. At the same time Kazaa will now be making a transition to a legal model and converting a powerful distribution technology to legitimate use."
Kazaa was developed by Niklas Zennstrom and Janus Friis, the creators of Skype, the internet telephone company that was sold to Ebay last year for $2.6bn.
The music industry has reached settlements with a number of file-sharing services following the Supreme Court's landmark ruling last year in the MGM-Grokster case. In that instance, the court ruled that Grokster could be held responsible for copyright violations committed by its users.
In May, BearShare, another file-sharing service, agreed to pay $30m to settle with the RIAA. The company also agreed to use "technological tools" and other means to restrict the sharing of copyrighted material on its network.
The record industry has been particularly keen to take down Kazaa because the company used the traffic it generated through its file-sharing service to sell advertising. As such, the industry has been determined to set an example and dissuade investors from backing other file-sharing services that might have commercial ambitions.
In spite of the legal victories, the record companies still lose more than $4bn to piracy each year, according to the RIAA. As some file-sharing services such as Grokster have shut down, other new ones have sprung up to take their place.
Copyright The Financial Times Ltd. All rights reserved.
URL: http://msnbc.msn.com/id/14057703/
User Comments
(These do not necessarily reflect the beliefs of this site)
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captdunsel
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Date: July 27, 2006 @ 10:56 AM
so does this mean that the riaa is going to have to remove all the viruses and fake files that they put on kazaa to keep people from using it? |
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GenerationX7
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Date: July 27, 2006 @ 12:27 PM
I guess so Capt. Does this mean Kazaa will no longer support indy music? Instead support the crap that we don't want to hear? |
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CodeWarrior
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Date: July 27, 2006 @ 12:56 PM
I still don't see how this has anything to do with robbery and murder on the high seas (legal def of piracy).
Besides that, it is a sad day...to me, it's like the day Mao Tse Tung came into power in China.
The Phillistines got their blood money and are thirsty for more. |
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CodeWarrior
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Date: July 27, 2006 @ 12:56 PM
""Kazaa was an international engine of copyright theft which damaged the whole music sector and hampered our industry's efforts to grow a legitimate digital business," said John Kennedy, head of the International Federation of the Phonographic Industry (IFPI), in a statement."
BULLSHYTE~ |
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TC4
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Date: July 27, 2006 @ 1:33 PM
so i wonder if the filters will affect just regular Kazaa or Kazaa Lite too? |
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ShadowMom
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Date: July 27, 2006 @ 2:36 PM
Blame Kazaa for spreading their music around the world to the widest possible audience. With record sales still dwindling, the recording industry needed a new revenue stream. But I'm with Code... this one hurts. They had the best chance to beat the evil empire of any company in the world. Too bad... now back to DMusic... where the music is still free :) |
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gdZiemann
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Date: July 27, 2006 @ 4:07 PM
Wait a minute, people.
Okay, the $100 million payoff is bad. Not so much for Kazaa, but for the fact that it more than negates any fines Spitzer got from payola (and the FCC will never fine them even if they remember they are having a "formal" investigation).
But this part: "Kazaa has also agreed to restrict the sharing of copyrighted material on its network."
Which copyright? Sound recording or words and music. Sound recording copyrights didn't exist until 1972. This means the Beatles and Jimi Hendrix, for instance, released all of their work before such a thing existed.
Since everything created is copyrighted by default, to hold true to this would mean nothing from after the 1930s would be available. What it really means is that Kazaa will restrict the sharing of anything the RIAA owns.
How are they gonna do that? Either they go to a centralized server so no one else can make music available (like those pesky independents) or they try to filter.
How? Even if they could somehow import the Library of Congress' database, everything filed at the copyright office before 1975 (maybe 1972) is still tracked on 3x5" index cards.
Such a list would actually contain my music, which is both copyrighted and legal for sharing.
So they'll have to get their info from the record labels, who are only interested in the ones they think they can still profit from. Remember, the RIAA cut a deal with iMesh, too. There were to be 2 million pay-to-play songs and 15 million free.
The degree of difficulty is enhanced by the fact that the list of songs to block (or require payment) is a moving target.
And...
If they could actually do it by preventing the sharing of RIAA material, well, that's what I've been asking for for five years. |
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CodeWarrior
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Date: July 27, 2006 @ 6:19 PM
George stole my thunder, because I was thinking along exactly the same lines.
For a good laugh, watch SUPERNOVA....
Tommy Lee and da boyz tellin' young aspiring singers they are screwed up songs by not jumping up and down and actin' da fool....
Yikes...my age is kicking in....
Down with the RIAA...up with DMUSIC...
BTW...George's music ROCKS...anyone that hasn't dl'ed it should check it out.
~Code |
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CodeWarrior
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Date: July 27, 2006 @ 6:20 PM
typo...meant "screwing up songs"...not screwed up songs....
my bad... |
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ChillinBuzz
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Date: July 27, 2006 @ 8:53 PM
meh, still sticking with WinMX now that it's easy to change the peer cache servers when the RIAA come knocking. :viking: |
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PhantomGhost
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Date: July 27, 2006 @ 10:00 PM
SHARMAN = TRAITORS
We need better representatives and senators on Capitol Hill who will reflect our values. People who will not be shills for the RIAA. |
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PhantomGhost
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Date: July 27, 2006 @ 10:00 PM
Damn. Posted twice. Still getting used to my new mouse. |
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CriticalCodger
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Date: July 27, 2006 @ 11:55 PM
"In spite of these substantial legal victories, the record companies still lose more than $4billion to piracy each year, according to the RIAA."
Yeah, "according to the RIAA". I'm so sure their record-keeping methods are above reproach. :sneer:
Just like THEIR record of numbers of CDs they say are produced and sold by the major labels.
I wonder if Microsoft uses creative loss estimates in the area of, say, a billion dollars (to peg for unpaid copies of their software floating around) to deduct from their income taxes.
Cartels and big fat-cat corporations: BLEAH!
May golden-hued "rain" fall all over 'em!!
:disdain and disgust:
:teeth-gritting fury:
In retrospect:
I wish the process of file sharing had been nothing more than computers linked to one another for mutual browsing functions of their media files WITHOUT a central, organizing server that compiles and organizes the stuff centrally. That way, neither Kazaa nor Grokster would have landed in this kind of devastating liability they are enduring.
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CriticalCodger
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Date: July 27, 2006 @ 11:58 PM
Still, the most significant aspect of any new paradigm developing in he future concerns what will happen to the playing field for independent artists. That's crucial!
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CriticalCodger
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Date: July 27, 2006 @ 11:59 PM
"in he future" should be "in the future"
(slapping errant fingers for causing me to make mistakes) |
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CriticalCodger
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Date: July 28, 2006 @ 1:04 AM
Kazaa reminds me of capitulating to the schoolyard bully
also, Grokster and Kazaa could have at least managed to get some sort of judgment against the RIAA's use of bots, spoofs, and multiple violations of the eulas of their file sharing networks during all these years
boo and hiss on Kazaa as well as the RIAA
yeah, hiss on 'em! |
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CodeWarrior
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Date: July 28, 2006 @ 2:52 PM
Agreement with excellent post of CriticalCodger... :thumbs up" |
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CriticalCodger
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Date: July 28, 2006 @ 3:34 PM
Thanks, 'Code!
(Folks, pardon me, but I can't help feeling good getting a compliment from the master.)
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