December 15, 2004 4:00 AM PST

FTC focuses on file swapping

The Federal Trade Commission on Wednesday will kick off a two-day workshop studying the consumer implications of peer-to-peer technologies.

The topics covered will range from the now-familiar effects of file-swapping services on entertainment companies to the potential risks consumers face by downloading content on peer-to-peer networks, or even just by installing the software.

The FTC does not have a specific proposal in front of it. It holds periodic workshops on new technologies to study issues raised and often comes up with recommendations to Congress afterward.

"There appear to be many current and potential business and consumer applications for P2P file-sharing technology," the organization said in a Federal Register notice announcing the meeting. "The...workshop is intended to provide an opportunity to learn how P2P file-sharing works, to discuss current and future applications of the technology (and) discuss the risks to consumers related to file-sharing activities."

The FTC has dabbled in file-sharing issues periodically, issuing a consumer warning in mid-2003 about the risks of bundled spyware, copyright lawsuits and pornography in using peer-to-peer software.

The organization subsequently worked with several file-sharing trade groups to develop a set of warnings that companies could post to help educate consumers about the risks. Those proposals are now complete, and the FTC sent a letter to Congress last week saying that--if implemented--they could help ameliorate some of the dangers.

This week's workshop comes as litigation over file-swapping networks has reached the highest pitch since the original days of Napster.

Last week, the Supreme Court agreed to hear a case dealing with the legal liability of peer-to-peer software companies for copyright infringement. Attorneys say the court's decision could fundamentally alter a precedent that many technology companies, including even Apple Computer with its iPod music player, have depended on for 20 years.

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