A decade after the rise of Napster and a year after promising a new antipiracy strategy, the Recording Industry Association of America appears to be floundering on the piracy front.
The plan adopted last year by the RIAA, the trade group for the four largest recording companies, in place of its controversial litigation campaign seems to have gone nowhere. The RIAA said at the time that it had struck partnerships with major Internet service providers, the Web's true gatekeepers, and that they would help choke off online piracy.
It was all supposed to be a done deal. The Wall Street Journal, which broke the news about the RIAA's strategy shift, wrote on December 19, 2008, that the RIAA had "hashed out preliminary agreements with major ISPs." According to the Journal story, the ISPs were supposed to join a deterrent program designed to gradually increase pressure on accused copyright violators. As part of the so-called "graduated response," RIAA officials told me that ramifications for repeat offenders would escalate, starting with the sending of multiple letters that could take an increasingly strong tone. Eventually, as the Journal noted, "the ISP may cut off their access altogether."
RIAA CEO Mitch Bainwol in a file photo.
(Credit: Declan McCullagh)Music execs had told me much the same thing and I wrote last year that AT&T and Comcast were testing their own graduated responses. But a year after the Journal's initial story, the number of ISPs that have acknowledged adopting the RIAA's graduated response program is zero. In addition, many of the big ISPs, such as AT&T and Comcast, have gone out of their way to deny that they would ever interrupt service to customers simply because they were accused of copyright violations by the film or music industries. To do that, they would need a court order.
Some ISPs, including AT&T, Comcast, and Verizon, appear to be sending greater numbers of their own warning letters--in addition to those sent by content owners--to customers suspected of file sharing. The letters typically notify customers that they have been accused of illegally sharing songs and informed them that such activity is illegal.
But here's the big question about the RIAA's graduated response plan: is it worth anything without a legitimate threat backing it up? It's difficult to believe that sending letters is enough of a deterrent.
Mitch Bainwol, the RIAA's chairman and CEO, acknowledges that his organization hasn't achieved all of the goals it laid out a year ago, but he says that the ISP strategy is well thought out, progressing, and has already seen dramatic results.
"We've seen a million notices [from ISPs to customers suspected of file sharing] go out over the past year and that is certainly meaningful," Bainwol told CNET last week. "Are we prepared to make an announcement that is broad in scope and cuts across ISPs? No. Are we engaged in significant discussions that we believe will ultimately prove productive? Hell yes."
Maybe so, but these deals were supposed to have been done or nearly done a year ago. What happened to those "hashed out preliminary agreements" that the Journal wrote about?
Missing teeth
Multiple music sources have told me over the past month the RIAA leaders were feeling pressure to drop the lawsuit campaign, but were also being lobbied by some at the labels to put some kind of deterrent in place, even if totally toothless. They didn't want the public to think there weren't any consequences to pirating music, even if the reality was exactly that.
According to those sources, the announcement about the ISP strategy last December was little more than a scarecrow.
Bainwol didn't comment on that but did say: "The substance of our pivot to ISPs is in fact accurate. The broader arrangement that cuts across the ISP community is still out there to be tied down. There clearly are discussions going on."
The reason that some at the labels wanted an end to the litigation is that for years it brought down mountains of public scorn. The lawsuits were also expensive and RIAA's members wanted costs slashed, which happened earlier this year.
The decision was made to continue to pursue the suits already in the courts, but the widescale practice of suing individuals was over.
Here's the other reason that several of the music-industry sources say the RIAA acted before any deal was done: to fire a shot across the bow of some of ISPs that were dragging their feet. By spreading the word that the RIAA had sewn up a deal with a group of big ISPs, RIAA managers hoped they were ratcheting up the pressure to join, sources say.
They also turned to Andrew Cuomo, New York's state attorney general, to nudge the ISPs into fighting piracy in the same way he pushed them to combat child pornography, said two music industry sources. This not only rubbed some ISP execs the wrong way, but unlike with the porn problem, the law was all on the side of the ISPs.
Nothing in the Digital Millennium Copyright Act requires ISPs to adopt a graduated response or even send their own warning letters.
"I don't know that the (ISPs) are legally obliged to do it," said Jonathan Zittrain, a noted cyberlaw expert and author. "I don't know any ISP that has been sued over it...The industry has chosen not to provoke a fight."
One reason for that may be that many bandwith providers want greater access to top entertainment content. The best example of that is Comcast's proposed acquisition of NBC Universal. To many in the film and music sectors, it appears that the interests of entertainment companies and ISPs are aligning.
"We've seen great progress and great cooperation from many of the ISPs," Bainwol said. "Getting to a public uniform understanding about how we're going to work together is obviously an extraordinarily complicated endeavor...[piracy] is a problem that developed over years and a solution is going to take time but we're achieving progress toward that goal."
Some progress
To be sure, in some ways the music industry's digital strategy has never been in better shape. It's never been easier or less expensive to acquire music legally than it is at such sources as iTunes, Amazon, and Pandora.
The music sector hasn't obtained a three-strikes policy in the United States, but it's been much more successful in forcing ISPs based overseas to boot repeat copyright offenders from their networks. And some ISPs, including Cox Communications, established antipiracy policies long ago that were similar to the RIAA's graduated response. But since the U.S. is a tougher environment when it comes to discussing service interruption, has Bainwol altered his definition of "graduated response"?
"I'm not locked into any particular definition," Bainwol said. "I think the parties that are negotiating and having discussions about what kind of program is appropriate will define how you work a graduated response program. The question here is: Are we working with the ISPs? Will there be some kind of graduated response program, where the infringer is made aware when they're caught and also when there are escalating tensions.
"We'll be flexible about how we get to a deal," Bainwol continued. "We'll let others define the poles of the position."
LOS ANGELES--The six largest Hollywood film studios are apparently dissatisfied with the way their trade group has waged war on illegal file sharing. CNET News has learned that at least three leaders of its antipiracy operations have been fired.
Among the three who were quietly ushered out of their posts at the Motion Picture Association of America three weeks ago was Greg Goeckner, the MPAA's general counsel. The others were the MPAA's director of worldwide antipiracy operations and its deputy director of Internet antipiracy. Goeckner will remain with the MPAA until the end of the year.
Other MPAA staffers were let go as part of a dramatic restructuring of the piracy-fighting operations, which included dropping the word "antipiracy" in favor of the term "content protection."
According to two sources in the film industry, the MPAA's antipiracy leadership had failed to impress studio executives, some of whom were concerned that the unit lacked aggressiveness. The reshuffling at the highest levels of the MPAA's antipiracy efforts will undoubtedly be seen as a black eye for MPAA CEO Dan Glickman.
An MPAA spokeswoman declined to comment on the firings but said that Daniel Mandil, an MPAA senior executive vice president, has been named general counsel and chief of content protection. He will oversee the association's combined legal and antipiracy efforts.
The shifts come as the sharing of movie files continues to creep toward mainstream adoption. In the past, digital copies of movies were too big to transmit easily on the Internet, but file-sharing technologies are improving, and sending large movie files is becoming easier.
Hollywood fears that the pirating of movies will become as common as the illicit sharing of music files. Studio insiders say they know that the answer isn't lawsuits but the hope is that Comcast, AT&T, Time Warner, and other bandwidth providers will help them thwart file sharing at the network level. So far, though, the music and film industries have failed to get the major ISPs very involved.
As for Glickman, the whispers from studio execs for over year is that the former U.S. secretary of agriculture (under former President Bill Clinton) hasn't been very effective since taking over at the MPAA in 2004. One source said that Glickman won't make it to the end of his contract, which runs out in September 2010.
The MPAA denied an impending early departure for the executive.
"This week Dan Glickman met with several of the MPAA member company studio executives, as he often does," said Angela Martinez, an MPAA spokeswoman. "During those meetings he reconfirmed his plans to continue in his role as chairman and CEO through the remainder of his contract. They welcomed that commitment and expressed their continued confidence in him."
The French National Assembly ignored a vote last week by the European Parliament and approved its "Création et Internet" three-strikes bill on Tuesday.
The measure supported by French President Nicolas Sarkozy punishes digital pirates by suspending Internet service if they are caught illegally sharing copyrighted material. The vote comes a little more than a month after the same government body rejected the proposal.
It seems the vote by the French Assembly is in direct opposition to the European Parliament, which last week passed a measure prohibiting EU governments from terminating a user's Internet access without a court order. The European Parliament also adopted an amendment that said, "Internet access is a fundamental right such as the freedom of expression and the freedom to access information."
The bill passed in France's National Assembly, the lower house of the French Parliament, by a narrow margin of 296 to 233. The legislation essentially creates a new government agency known as HADOPI (the Haute Autorité pour la Diffusion des Oeuvres et la Protection des droits sur Internet), which will be tasked with sending notices to illegal file sharers.
The way it would work is that suspected offenders would receive two warnings about their illegal activities and on the third suspected offense, their Internet access would be cut off for anywhere from two months to a year. Users will also be put on a "three-strikes" blacklist so that they can't sign up for service from another ISP.
The legislation has proven to be quite controversial in France and throughout the world. It is considered one of the most aggressive digital antipiracy regulations out there, which has helped it win the support of the music and movie industries.
But consumer and free speech advocates have opposed the passage of such legislation, arguing that it denies accused Internet pirates the right to challenge the government's charges in court. Opponents of the legislation also fear that it will pave the way for governments to violate its citizens' personal privacy rights.
The bill had been expected to pass the General Assembly in France in early April, but Socialists, who opposed the measure, rallied at the last moment, and surprisingly defeated the measure.
It was reintroduced to the assembly in late April and was debated and discussed until the vote Tuesday.
Even though the entertainment industry for years has lobbied for more active policing of the Internet, France is one of the only countries to put together such stringent legislation. Other countries, such as the United Kingdom and the United States, have not introduced strict legislation yet, but instead are encouraging partnerships between ISPs and the entertainment industry to fight piracy.
At least one major ISP in the U.S., AT&T, has already agreed to work with the music industry by sending notices to consumers suspected of illegally distributing copyrighted content. And in the U.K., ISPs have agreed to help the entertainment industry fight piracy in lieu of new legislation.
But other countries, such as Sweden are also taking a heavy handed approach to fighting digital piracy. France's strict piracy legislation comes less than a month after a Swedish court found the founders of the peer-to-peer site The Pirate Bay guilty of infringing copyright. The four defendants were each sentenced to a year in jail and ordered to pay 30 million Swedish kronor ($3.6 million) in damages to copyright holders. The Pirate Bay has already been mentioned as one of the sites that could be easily taken out under the new French law.
Updated Wednesday at 9:00 a.m. PDT to include quotes from AT&T and information about Comcast and Cox.
Updated Wednesday at 10:37 a.m. PDT to include a statement from an AT&T spokeswoman who wished to correct what she had previously said. She says now that the company asserts in the letters that it has the right to terminate a policy. She said, however, the company has no intention of doing so.
Updated Wednesday at 3:40 p.m. PDT: AT&T says that it won't ever terminate service of customers without a court order. To read more updated information about this, go here.
AT&T, one of the nation's largest Internet service providers, confirmed on Tuesday the company is working with the recording industry to combat illegal file sharing.
At a digital music conference in Nashville, Tenn., Jim Cicconi, a senior executive for AT&T, told the audience that the ISP has begun issuing warning notices to people accused of pirating music by the Recording Industry Association of America, according to one music industry insider who was present.
Early Wednesday morning, an AT&T spokeswoman confirmed that Cicconi made the statements.
In December, the RIAA, the lobbying group of the four largest recording companies, announced the group would no longer pursue an antipiracy strategy that focused on suing individuals, but rather would seek the help of broadband providers to stem the flow of pirated content. The RIAA said an undisclosed number of ISPs had agreed to cooperate but declined to name them. In January, CNET News reported that AT&T and Comcast were among the group.
Sources told CNET on Wednesday that a Comcast executive confirmed that the nation's second largest ISP is working with the RIAA. At the same Nashville conference where Cicconi spoke, the Comcast exec said the ISP has sent 2 million warning notices to customers accused of infringement by entertainment companies. The sources have also confirmed that Cox is a member. (You can read more about that here: "Comcast, Cox join RIAA antipiracy campaign.")
Representatives of the RIAA could not be reached for comment.
Cicconi told attendees of the Leadership Music Digital Summit that the notices, which are sent via e-mail, are part of a "trial." AT&T wants to test customer reaction, he said. It was unclear Tuesday evening if AT&T had included any threats to suspend or shut off service.
The RIAA had said that under its "graduated response" plan, repeat offenders faced the possibility of their ISP suspending or terminating service--at least temporarily. There are also other forms of escalating responses, such as the sending of multiple letters. Some of the notices could take a stronger tone or perhaps the ISP might follow-up with a phone call. Managers at the organization have also said they support due process to protect people from being falsely accused. What the due process includes has yet to be determined.
Reached Wednesday morning, Claudia Jones, an AT&T spokeswoman, said the company's letters do include a mention that company retains the right to terminate service. She wanted to make it clear that AT&T has no intention of doing so, however. Jones also said the ISP never shares customers' names or any other personal information. What the company does do is send a "cover letter" to the accused customer along with the letter the ISP received from the RIAA stating that the person's IP address was flagged.
AT&T goes on to tell the accused customer that the problem may be caused by a teenager in the house who may be illegally downloading or that the customer might have an insecure Internet connection and that someone could be using it to steal content.
The ISP also informs the customer that downloading unauthorized copies is illegal and should be prevented. As for chronic offenders, Jones was less specific but said: "We can't assume that people are stealing. All we know is that they are using a lot of bandwidth. We can't be the police or the copyright enforcer...that's up to the content owner."
All the activity going on with AT&T, Comcast, and Cox is likely the first stage in what promises to be a long and drawn out process of using ISPs to help protect copyright material.
ISPs have traditionally tried to stay out of the fray between the big entertainment companies and those who download music illegally. They remain squeamish about the possibility of alienating customers, according to music industry sources. The ISPs also don't like plans that call for them to cut off access and chase away a source of income.
Note to readers: Have you received a warning letter from AT&T or another ISP? If so, e-mail me by clicking on the link in my bio below. Please include your contact information. I won't reveal your name in any story if that's what you prefer.
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