Many industries could not exist without the protection of intellectual property laws such as patent and trademark. The piracy of copyright works can destroy industries; wholesale illegal copying of Chinese films threatens Hong Kong's once thriving film studios. The music industry is challenged by the prospect of music distribution online, new formats such as MP3 allow consumers to download music relatively swiftly and easily and websites have sprung up to service this content.
While a lot of music is downloaded legitimately, online music piracy would appear to be a major problem. To counter this threat, the industry has taken action against the suppliers of the equipment associated with MP3 but, so far, judgments (in RIAA v Diamond Multimedia and Realnetworks-v-Streambox) have gone against it.
The industry has had far greater success in litigation against prominent music websites. In UMG, Sony, Warner et al-v-MP3.com, the US Courts held that MP3.com was "replaying for the subscribers, converted versions of the recordings it copied, without authorisation, from the plaintiff's CDs" and so was in obvious breach of the law. There is nothing surprising about this victory; copyright law is as enforceable on the Internet as it is elsewhere. As most of the world has now joined the World Trade Organisation (WTO) and the attendant World Intellectual Property Organisation (WIPO), anyone wishing to avoid copyright law will have to go to countries such as Iraq and North Korea.
The record industry scored another interim victory in A & M-v-Napster, in which the defendant provided a search engine which would match up songs sought by one group of Internet users with the songs which other users were making available online. The US's Digital Millennium Copyright Act excludes the operators of search engines from liability where the search engines are used to find material that breaches copyright. Napster unwisely failed to fully comply with this exception. It is quite probable that other search engines are being written and marketed which will comply with this Act.
The Internet will not change who owns the copyright of songs, films or books but it will radically alter how these works are distributed. While the legal control of music copying is straightforward, any attempt to control music distribution may raise more complex legal questions. Although courts and legislatures are quick to prevent and punish copyright theft, the protection of intellectual property has to be balanced with the needs of consumers and citizens.
Concerns similar to the recent Microsoft monopoly case might be raised if the companies which control the most popular music tried to use that control to limit the use of MP3, and to impose new "secure" formats, such as those which are now available from IBM, Intertrust and Microsoft. These formats use encryption to prevent piracy.
However, major record labels and performers whom they have signed are not the only groups which have a legitimate interest in online music distribution. The Internet is host to a wide variety of unsigned artists and independent labels. These are groups who enjoy the artistic freedom and global audience which MP3 and the Internet has given them, and their interests will have to be balanced with the need to prevent online music piracy.
A particular concern is that the industry would attempt to use its control of copyright not to protect the interests of its performers, but rather to limit the threat posed by the Internet to the existing physical infrastructure of music distribution such as record stores, warehouses and CD pressing plants.
It is probably only a matter of time before the film industry faces a similar threat. A program called DeCSS allows the proprietary encryption contained on DVD disks to be bypassed, enabling movies to be copied in the same way as tracks can be "ripped" from a CD and then distributed online. Litigation has been initiated against those accused of writing and distributing the program and, as the files that contain digital movies are so large, DVD piracy will not become a major problem until Internet bandwidth is increased. An immediate consequence is that the music industry has become wary of selling its products on DVD, which limits consumers' choice.
Undoubtedly, consumers should benefit from the very low cost of distributing digital content over the Internet, but if the piracy problem is not solved and nobody can benefit from creating that content, then the quality and quantity of the content available online will inevitably decline.
Denis Kelleher BL is a practicing barrister and co-author, with Karen Murray, of IT Law in the European Union, Sweet & Maxwell (London) 1999 and Information Technology Law in Ireland, Butterworths (Dublin) 1997.
www.ncirl.ie/itlaw