Balancing P2P and Copyright Infringement

Published September 1, 2004

Internet file sharing, commonly referred to as peer-to-peer (P2P) networking, allows individuals to trade copies of their digital files over the Internet. To use a P2P service, such as KaZaA, users download software that enables them to “join a club.” Members of the “club” store and download copies of digital files directly from their computers at no cost. The majority of P2P users trade digital copies of songs and, to a lesser extent, movies. It is the unauthorized “sharing” of these copyrighted music and movie files that has stirred the P2P controversy.

Several approaches to dealing with P2P are being considered in Congress. The Senate recently passed S. 2237, a bill that would authorize the Department of Justice (DOJ) to bring civil charges against anyone who infringes a copyright. Another pending bill, S. 2560, would hold file-sharing services liable for individual users’ copyright infringements.

Other suggested reforms have ranged from allowing copyright holders to engage in “self-help” measures to disrupt P2P operations to regulation of devices and software. Outside the legislative arena, the music industry continues to file lawsuits against “heavy” P2P downloaders, and private companies continue to develop electronic measures to stop unauthorized copying.

Proponents of P2P argue the practice does not harm album (or movie) sales–some even suggest it increases sales. Two recent studies, however, suggest P2P has caused a decline in album sales by anywhere from 8 to 30 percent. P2P threatens the future of the music industry because it forces copyright holders to compete with products that are given away. As broadband Internet connections become more powerful, the film industry also could be at risk.

Copyright owners should be able to vigorously protect their intellectual property against theft, in court and through private action. Policymakers can help clarify rights by amending the law so that making copyrighted work available to the general public on the Internet is undoubtedly an infringement, and allowing DOJ to bring civil suits. The law should be narrowly targeted, however, against those who actually misappropriate protected works, not P2P networks in general, ISPs, or those engaged in “fair use” of the works.

Regulation of devices and software should also be rejected–while technology mandates might reduce unauthorized copying, such rules could stifle innovation. Ultimately, the solution may be a private one, with copyright owners using new technologies to make unauthorized copying of works more difficult.

Norbert J. Michel ([email protected]) is a research fellow with The Heritage Foundation.