July 14, 2003 5:02 PM PDT

RIAA threat may be slowing file swapping

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The record industry's plan to sue individuals who trade songs online has caused a precipitous drop in the use of file-swapping applications, according to one Internet ratings service.

Nielsen/Netratings, a company that monitors Web traffic and desktop application use, said that use of top file-trading applications such as Kazaa and Morpheus have fallen by about 15 percent since the end of June. On June 25, the Recording Industry Association of America announced it was planning to file what could be thousands of lawsuits against individuals who trade copyrighted music online.

"I would definitely say it's not a coincidence that the numbers fell that far," said Greg Bloom, senior analyst with Nielsen/Netratings. "A drop this significant probably has some kind of external cause."

Although Nielsen/Netratings' numbers are provisional, and falling Net traffic in the summer can be explained in part by vacationers going offline, the statistic is bound to be closely watched by those with a stake in the copyright debate.

A significant element of the RIAA's plan is to persuade large numbers of file traders that putting copyrighted material online is too risky. The number of lawsuits filed, while potentially huge, will still be miniscule compared with the hundreds of thousands or millions of people who use peer-to-peer networks every day.

File-trading companies question Nielsen/Netratings figures. StreamCast Networks CEO Michael Weiss, whose company distributes the Morpheus software, said his team hasn't seen a perceptible drop in the past several weeks.

"We're seeing something completely different," Weiss said, noting that their logs show about 250,000 unique visitors a day. Those visitors even appear to be staying online longer, based on the number of banner ads each user sees per session, he added.

Neilson/Netratings numbers found that Morpheus' figures had dropped 15 percent from 272,000 unique visitors in the week ending June 29, to 231,000 unique visitors in the week ending July 6.

The Kazaa software, the most popular file-trading application, also saw usage fall 15 percent, from 6.5 million to 5.5 million unique users that week, according to Neilson/Netratings.

Both measurements are extrapolated from a sample pool of about 50,000 home Internet users in the United States. By comparison, usage of the popular AOL Instant Messenger application dipped 9 percent over the same period, Bloom said.

Despite denials that the RIAA warnings are having much effect on traffic, most file-swapping companies are scrambling to put new privacy features into their software.

StreamCast Networks plans to release a new version of its Morpheus software on Tuesday that will let users upload and download files through proxy servers, a venerable if imperfect way for Internet users to mask their identities online.

RIAA officials have said they are already gathering information about people offering large numbers of copyrighted songs online, and plan to start filing copyright infringement lawsuits next month.

 

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