File Sharing, Copyright Laws, and Fair Use Rights

Randy Escherich

The issue of copyright violations is a controversial topic. On one side, the recording industry claims that file sharing is cutting into their profits and violating copyrights of the artists. On the other side, are millions of people who are sharing files everyday. These individuals believe that the recording industry has refused to change with the evolving technology and some believe that the cost of music CDs are too expensive.

Right now the legal dispute surrounding file sharing is a big problem for the Recording Industry Association of America (RIAA) and the Motion Picture Association of America (MPAA). According to an article on the CBS news website titled, "Ruling A Blow to Online Music Pirates", about three million people were connected on the Kazaa network and sharing more than 500 million files. The president of the RIAA Cary Sherman said, "The illegal distribution of music on the internet is a serious issue for musicians, songwriters, and other copyright owners, and the record companies have made great strides in addressing this problem by educating and providing them with legitimate alternatives."

A personís values will influence the way an individual may feel about downloading illegal copyrighted music. The music they want to download may not be on the legitimate music downloading sites. Pressplay, for example, has a lot of music, but there are many restrictions as to what consumers can do with the music they download. The files downloaded have embedded "digital rights management," which limits what can be done with them. Pressplay <> will charge $9.99 per month for the unlimited package, $17.95 per month for the unlimited plus package, and $14.99 per month for the annual plus package. <> will charge $9.99 per month for a year subscription, or $14.99 a month for a three month subscription. EMusic doesnít place any restrictions on what can be done with the music, but has a limited selection.

According to an article on CBS news website titled "Online Swapping Crippling CD Sales," compact disc music sales decreased 7% during the first half of 2002. This trend is an indication that online music sharing networks may be hurting the recording industry. According to the RIAA, this decrease cost the industry $284 million in lost sales. PricewaterhouseCoopers, an independent survey company, reports a 5.3% drop in CD shipments in the first half of 2001. The RIAA uses just-in-time delivery to monitor retail CD sales, so CD shipments are reliably indicative of actual sales. This method of monitoring will allow the recording industry to track the number of CD sales in real time. Each purchase is recorded electronically and sent to the appropriate facility for re-ordering, marketing, or advertising purposes.

Interestingly, previous studies independent of the music industry have suggested that access to free music on the Web encourages consumers to experiment with new acts, or to download only the music they like to hear and buy more CDs.

Geoff Garin, a pollster for Peter D. Hart Research Associates, states that he finds a striking connection between people who say they are downloading more and buying fewer CDs. A random telephone survey of 860 consumers for the RIAA in May 2002 found that those individuals whose downloading had increased during the last six months, 41% of those reported buying less music, while 19% reported they were purchasing more music. Individuals polled who said they were downloading the same amount as six months ago, 25% of those said they purchased less music, compared with 13% who bought more.

According to a January 14, 2003 article on CBS news web site titled "Internet Music Rights Deal Reported," Representative Zoe Lofgren, (D)-California, Rick Boucher, (R)-Virginia, and John Doolittle, (R)-California, believe it is the consumersí best interest to further define consumersí rights under U.S. laws affecting copyrights. Boucher believes that the Digital Millennium Copyright Act (DMCA) has some serious flaws. Any individual that modifies digital media in any way is in violation of the DMCA. Therefore, ripping music off of CDs and copying the music to a hard drive in the form of mp3 files has violated the DMCA. Boucher, Lofgren, and Doolittle have proposed legislation to adopt a new bill, the Digital Media Consumersí Rights Act, to allow consumers to regain their basic Fair Use Rights.

I have been following the development of the issue for Fair Use Rights of the individual over the seemingly monopolistic power of the recording industry. According to the Fair Use Rights act of 1974, consumers are not violating any copyright laws when copying music onto their computers hard drive. However, if the individual chooses to make available to the public copyrighted work, or to sell copyrighted work with out the consent of the copyright holder, then according to the DMCA of 1998 that individual is in direct violation of this copyright law. I believe that this type of copyright infringement should be illegal. CC