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MGM Versus Grokster Two Years Later

By: Dan Morrill

Two years ago MGM Won against Grokster in a pinnacle case that set out the legitimacy or illegitimacy of P2P file sharing.

Since then:
    "On an average day, about 9.3 million people worldwide log onto a software file-sharing services, up from 7 million in 2004, according to research firm Big Champagne, which tracks Internet usage. About a billions songs are traded illegally online per month.

    Music sales have fallen 17% from its peak in 2000 of $12.7 billion, a trend the Recording Industry Association of America blames on illegal file swapping. The Motion Picture Association of America says it lost $2.3 billion to Internet piracy in 2005". Source Investors Daily
The proliferation of peer-to-peer networks is a relative given; people are going to do this kind of activity. It has become ingrained in the culture, and many of the folks that I talk to consider it similar to radio or television.

Controversy is guaranteed to continue around the idea of stolen content not just in the peer networks, but on sites like YouTube, MySpace, and a host of others. The streaming media interface has gotten so ubiquitous that even small sites like with maybe a dozen users a day can "afford" to carry streaming media on its web site by using YouTube and other sites as the base for where the media originally appeared.

The differences between YouTube and Peer-to-Peer networks are increasingly blurred, giving credence to the idea that this is a societal issue. In the world of Media 2.0, where user generated content is delivered for free to these kinds of web sites, the jump to YouTube from Lime Wire is not hard to make for the average person.

Hence the same level of DMCA take downs, lawsuits, and negotiation failures that plagued Kazaa and Grokster are happening on YouTube and MySpace. Media 2.0 depends on people submitting content. Even two years later, the user submitted content keeps on growing beyond RIAA/MPAA/BSA lawsuits or bounties for "turning people in".

Media 2.0 with web based streaming might end up being fractured the same way that the P2P networks have been, where it ends up being a game of cat and mouse, sites that come and go, but the media stays on the internet in increasingly smaller groups of like interest. The onset of Peer Networks that only share amongst a small group of parties that share the same interest are already a reality in Web 2.0.

Web 2.0 streaming media operators like the social media share web sites eventually will face a lengthening process of DMCA take downs, complicated by lawsuits from big media producers, ending up much like the P2P networks.

Two years after the MGM Grokster case, the use of P2P networks continues to grow. The use of Web 2.0 media driven web sites continues to grow. Big Media and Big Web 2.0 companies need to find a way to co-exist in a way that does not lead to further deterioration of remuneration for the people who make the content.

Advertising provides some promise of making that happen. Revenue share also holds promise, but both sides need to sit down and figure out how to make this work for all parties involved before the web 2.0 social media system ends up like the P2P networks. Smaller, fractured, but still there, still available to anyone with a client, and still operating.

I personally would hate to see Web 2.0 fall apart, social media holds a lot of promise; the major players just need to figure out how to make it pay, and how to make it pay for everyone.


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About the Author:
Dan Morrill has been in the information security field for 18 years, both civilian and military, and is currently working on his Doctor of Management. Dan shares his insights on the important security issues of today through his blog, Managing Intellectual Property & IT Security, and is an active participant in the ITtoolbox blogging community.

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