ISPs pressured to police digital music

The music labels are heading to court again to deter digital downloads, even though some analysts call such technology the key to the recording industry's future.

In a lawsuit filed Friday in Federal District Court in New York, a handful of entertainment giants are seeking a court order requiring major Internet service providers to block access to, which they allege allows illegal distribution of songs. Plaintiffs include Sony Music Entertainment Inc., Warner Brothers Records Inc., Virgin Records America Inc., Capitol Records, and others.

Industry observers called it the first file-sharing suit targeting ISPs instead of the file-sharing service itself, and consumer advocacy groups questioned the tactic. was inaccessible on Monday, but a Google Inc. cache of the page showed that users could search for songs by artist and album. In the cache, all the songs from, for example, Toni Braxton's 2000 album "The Heat" appeared available. The suit alleges that the site distributed some albums even before they went on sale in stores. Site operators use servers based in China and are identified only by an anonymous e-mail.

An inquiry to the site administrator brought an e-mail response acknowledging that the site is closed, possibly permanently. "I don't think [sites] like Listen4ever can hurt these big record companies," wrote Mike Smith, who added that the music industry players "don't know the Internet's spirit--'free and share.'"New BattlefieldThe music labels would probably concur. They say they have a right to seek blockage of the site under the Digital Millennium Copyright Act. According to the complaint, the labels were unable to get Listen4ever to halt downloads voluntarily, and accuse the site operators of using the China-based servers to circumvent U.S. law.

The complaint names as defendants a handful of major ISPs, including AT&T Broadband, Cable & Wireless, Sprint, and UUNet, a division of WorldCom. The ISPs told the labels they would not block access to any site unless required by a court order, according to the suit.

Representatives of AT&T Broadband, Sprint, and WorldCom declined to comment on the suit, citing company policy against discussing ongoing litigation. A call to Cable & Wireless was not returned.

Last week's move is a new push for the labels, which successfully sued file-sharing service Napster, says Fred von Lohmann, an attorney with the Electronic Frontier Foundation. "I do think it marks a new front in the war," he says. But he was skeptical whether such tactics would help the recording companies in their long-term battle for control of digital music.

Although the labels have a right to sue Listen4ever, their efforts might be better spent developing and promoting download services that are more attractive to consumers than the current pirate sites, suggests Graham Spencer, a cofounder of fair-use advocacy group DigitalConsumer.

"A lot of people who are outside the recording industry have always observed that it would make more sense to embrace" file downloads, rather than try to thwart them, Spencer says.

Tunes of Future

In fact, the newest attack comes even as two major research firms declare a vision of music downloads as the future cash cow for recording labels. A study released last week by Forrester Research says that, contrary to music industry claims, downloads have not hurt the recording industry.

The study, which marks a reversal from Forrester's previous views, says that downloads caused at most a 2.5 percent drop in sales--only a small portion of the 15 percent decrease the industry has seen in the last two years. It attributes most of the lower sales to the lagging economy, competition with other entertainment outlets, and radio playlists that tend not to feature up-and-coming artists.

The recording industry disputes the study, saying its own research will be released in the coming months. Recording labels cite declining sales as evidence that online piracy is killing their business and preventing growth in the digital music market.

In any case, both the Forrester study and another recently released by the Yankee Group say the music labels must ultimately embrace digital downloads to stay in business. Such acceptance will require a "philosophical shift" in the recording industry, The Yankee Group notes. Its analysts predict that legitimate downloads will begin to overcome illegal sharing in 2006.

"If I were the music labels, I would take half the money I've put into litigation and legislation and lobbying and I would put it into researching" ways to capture the digital download market, says Josh Bernoff, author of the recent Forrester study.

Also, legislation to prevent illegal file-trading is pending in Congress. The measure, sponsored by California Democrat Howard Berman, has the endorsement of the Recording Industry Association of America. It was introduced just before the current month-long recess, and members will have to act fast to consider or act on it before the close of the session this fall.

Gretel Johnston of the IDG News Service contributed to this report.

Chiger writes for the Medill News Service.

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Stephen Chiger

PC World
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