Port 21 (Distribution and Promotion Remix)

Brian Geoghagan

Winter 2005

COM546

Professor Gill

Back In The Day (c.1995)

Pre-Broadband Hard Drive space appx. $1 per megabyte MP3 encoder and player released June ‘95 by The

Fraunhofer Society 3min Uncompressed = 90min 3min Compressed (MP3) = 9min

1999

$0.17 per MB (20GB = $300) Broadband rapidly spreading Increased Internet usage Winamp MP3 player Increased acceptance of MP3

technology

Napster

Shawn Fanning October 1999 Centralized Servers 50-70 Million Users

Legal Debate

R.I.A.A. vs. Napster (December 1999) Contributory Infringement – knowingly encouraging infringing activity. Vicarious Infringement – violation occurs when operator has the ability to

supervise users, but chooses not to for financial benefit.

Metallica/Dr. Dre vs. Napster (April 2000)

Napster’s Defense

Fair use Sampling Space Shifting Permissive Distribution

Non-Commercial & Non-Profit Use Does not copy, record, encode or transfer MP3 files American Home Recording Act (AHRA)

Allows recording copyright protected material for personal use

Metallica vs. Napster

The Settlement

Mutually beneficial 300,000 users banned from Napster Temporary injunction shuts down Napster Napster not solely reliable for copyright material on

servers Shared liability with Artists/labels Must notify Napster of copyright protected files 36hrs to remove files

R.I.A.A. vs Napster

AHRA not applicable because computer is not recording device Religious Technology Center versus Netcom On-Line

Communication Services. ISP responsible for copyright infringement if they know of

infringement and have the ability to remove the protected material

Sony v. Universal Legal use of VCR trumps illegal use Sony cannot control what consumers use the VCR for in

their homes, therefore not liable for any copyright infringement

Time-shifting constitutes Fair Use

Decision

regardless of the number of Napster’s infringing versus non-infringing uses…plaintiffs would likely prevail in establishing that Napster knew or had reason to know of its users’ infringement of plaintiffs’ copyrights

File sharing harms copyright holders ability to make money from the same material.

File sharing is commercial use because users get something for free they would have had to pay for.

Further Studies

Didn’t factor increase in video game & DVD sales

Fewer major releases Felix Oberholzer and Koleman Strumpf

Tracked Downloads from file sharing networks and RecordScan sales during 2002 and found file sharing had an impact “indistiguishable from zero”

File sharing results in net-increase in music consumption Lower cost increases audience size Magnitude of file sharing increases social welfare

Future

Success of iTunes Music Store and portable MP3 players clearly shows room for growth in digital download market

SoulSeek and other P2P Networks New modes of sharing

MP3 Blogs BitTorrent Web based file sharing services

(yousendit.com, rapidshare.de) Hype Machine reports 400 sales

through iTunes and Amazon in October.

QuickTime™ and aGIF decompressor

are needed to see this picture.

Questions?