Ever since Napster popped up on the digital radar, music fans have felt safe swapping MP3s without getting busted. But after an unprecedented settlement this month, it might finally be time to pay the piper. The news comes from Tempe, Arizona, where a Web development company called Integrated Information Systems has been hit with a $1 million penalty for allowing its employees to trade digital music files over the firm's computer network. "Wow" is right: So much for that blissful feeling of invulnerability.

The bust occurred after the Recording Industry Association of America received an e-mail from someone who alerted them to the violations. Upon investigation, the RIAA discovered that Integrated Information Systems had dedicated an entire computer server specifically for the trading of MP3s -- kind of like a company fridge filled with free snacks. The RIAA threatened to sue. Rather than endure a lengthy and pricey lawsuit, Integrated Information Systems haggled the seven-figure settlement. This is the first time a company has had to pay even a nickel -- let alone a million bucks -- for facilitating music trades within its own office.

The Arizona bust is clearly meant to send a message to corporations, large and small: Police your employees' file trades or pay big time. For years, of course, the obvious solution to digital piracy has been to bust the bootleggers themselves. Though the RIAA fined a couple students a few years ago for swapping digital tunes over a university networks, it has since pretty much dropped such pursuits; nailing every bootlegger in the world, after all, would cost a ton of money and piss a lot of consumers off. So instead, the RIAA focused on trying to bust the software development companies -- Napster, Aimster, Streamcast, etc. -- that provide the means for online trades to occur. But despite the high-profile downing of Napster, this tact has done little to stop the trades. The Arizona bust represents a new and, initially, successful strategy: Neuter the workplaces where trading occurs.

Given long hours and high bandwidth, offices large and small have become havens for MP3 sharing. Some companies rely on firewalls to help curb the activity, but this doesn't stop employees within the cubicles from exchanging MP3s with each other. Now the RIAA is giving bosses a costly reason for due diligence. The bust also represents a disturbing strategy. It inspires Big Brother to grow even bigger; companies fearful of a penalty will inevitably crack down on any kind of file-trading that occurs, legal or not. Policing such activity will only cost time and money better spent elsewhere. It also assumes that every MP3 file is a bootleg when, in fact, artists from Neil Young to Brandy readily distribute free MP3s online. Then again, white collar geeks won't be totally out of luck. When all else fails, they can always burn each other CDs.

DAVID KUSHNER
(April 15, 2002)