Music Industry to Abandon Mass Suits - WSJ.com
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`TECHNOLOGY
`
`Music Industry to Abandon Mass Suits
`
`BySARAH MCBRIDE and ETHAN SMITH
`Updated Dec. 19, 2008 12:01 a.m. ET
`
`After years of suing thousands of people for allegedly stealing music via the Internet, the recording industry
`is set to drop its legal assault as it searches for more effective ways to combat online music piracy.
`
`The decision represents an abrupt shift of strategy for the industry, which has opened legal proceedings
`against about 35,000 people since 2003. Critics say the legal offensive ultimately did little to stem the tide
`of illegally downloaded music. And it created a public-relations disaster for the industry, whose lawsuits
`targeted, among others, several single mothers, a dead person and a 13-year-old girl.
`
`Instead, the Recording Industry Association of America said it plans to try
`an approach that relies on the cooperation of Internet-service providers.
`The trade group said it has hashed out preliminary agreements with major
`ISPs under which it will send an email to the provider when it finds a
`provider's customers making music available online for others to take.
`
`Depending on the agreement, the ISP will either forward the note to
`customers, or alert customers that they appear to be uploading music
`illegally, and ask them to stop. If the customers continue the file-sharing,
`they will get one or two more emails, perhaps accompanied by slower
`service from the provider. Finally, the ISP may cut off their access
`altogether.
`
`The RIAA said it has agreements in principle with some ISPs, but
`declined to say which ones. But ISPs, which are increasingly cutting
`content deals of their own with entertainment companies, may have more
`incentive to work with the music labels now than in previous years.
`
`The new approach dispenses with one of the most contentious parts of the lawsuit strategy, which involved
`filing lawsuits requiring ISPs to disclose the identities of file sharers. Under the new strategy, the RIAA
`would forward its emails to the ISPs without demanding to know the customers' identity.
`
`Though the industry group is reserving the right to sue people who are particularly heavy file sharers, or
`who ignore repeated warnings, it expects its lawsuits to decline to a trickle. The group stopped filing mass
`lawsuits early this fall.
`
`It isn't clear that the new strategy will work or how effective the collaboration with the ISPs will be. "There
`isn't any silver-bullet anti-piracy solution," said Eric Garland, president of BigChampagne LLC, a piracy
`consulting company.
`
`Mr. Garland said he likes the idea of a solution that works more with consumers. In the years since the
`RIAA began its mass legal action, "It has become abundantly clear that the carrot is far more important
`than the stick." Indeed, many in the music industry felt the lawsuits had outlived their usefulness.
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`http://online.wsj.com/news/articles/SB122966038836021137
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`3/18/2014
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`Music Industry to Abandon Mass Suits - WSJ.com
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`"I'd give them credit for stopping what they've already been doing because it's been so destructive," said
`Brian Toder, who represents a Minnesota mother involved in a high-profile file-sharing case. But his client
`isn't off the hook. The RIAA said it plans to continue with outstanding lawsuits.
`
`Over the summer, New York State Attorney General Andrew Cuomo began brokering an agreement
`between the recording industry and the ISPs that would address both sides' piracy concerns. "We wanted
`to end the litigation," said Steven Cohen, Mr. Cuomo's chief of staff. "It's not helpful."
`
`As the RIAA worked to cut deals with individual ISPs, Mr. Cuomo's office started working on a broader
`plan under which major ISPs would agree to work to prevent illegal file-sharing.
`
`The RIAA believes the new strategy will reach more people, which itself is a deterrent. "Part of the issue
`with infringement is for people to be aware that their actions are not anonymous," said Mitch Bainwol, the
`group's chairman.
`
`Mr. Bainwol said that while he thought the litigation had been effective in some regards, new methods
`were now available to the industry. "Over the course of five years, the marketplace has changed," he said
`in an interview. Litigation, he said, was successful in raising the public's awareness that file-sharing is
`illegal, but now he wants to try a strategy he thinks could prove more successful.
`
`The RIAA says piracy would have been even worse without the lawsuits. Citing data from consulting firm
`NPD Group Inc., the industry says the percentage of Internet users who download music over the Internet
`has remained fairly constant, hovering around 19% over the past few years. However, the volume of music
`files shared over the Internet has grown steadily.
`
`Meanwhile, music sales continue to fall. In 2003, the industry sold 656 million albums. In 2007, the number
`fell to 500 million CDs and digital albums, plus 844 million paid individual song downloads -- hardly enough
`to make up the decline in album sales.
`
`—Amol Sharma contributed to this article.
`
`Write to Sarah McBride at sarah.mcbride@wsj.com and Ethan Smith at ethan.smith@wsj.com
`
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