Downloaders Fighting Back

Despite lawsuits, traffic on file-sharing sites is booming

September 26, 2003 12:00 AM ET

It's been the summer of fear online because of the music industry's campaign to sue file traders. But after millions of instant-message warnings, some 1,600 subpoenas and at least 261 lawsuits, there's been no discernable effect on piracy. Traffic on Kazaa dipped thirty-five percent after the Recording Industry Association of America announced its new anti-piracy initiative, according to Nielsen/NetRatings. But roughly 4 million users each week are still on Kazaa, and many of them are beyond the reach of the law.

One reason the RIAA strategy is having a limited effect is that the organization can pursue only file traders violating U.S. laws. Even if all Americans stop sharing their record collections on the Internet, millions of files would still be available from foreign swappers. Some forty percent of peer-to-peer users hail from overseas. And other national music-trade groups, like those in Britain and Australia, have said they have no current plans to file U.S.-style lawsuits.

Another factor keeping illegal music alive is the RIAA's strategy of pursuing only the most egregious uploaders -- those offering roughly 1,000 files from their hard drives. According to the Internet research firm BigChampagne, eighty-six percent of all file sharers have less than 200 songs available. "The record industry is perpetuating the belief that relatively few supersharers are responsible for all trading, and by yanking their participation, the networks collapse," says BigChampagne CEO Eric Garland. While Kazaa traffic slowed during the summer, usage was steady on Morpheus and increased on smaller file-sharing networks such as BearShare.

The threat of lawsuits hasn't caused traders to go legal, either. After Apple's iTunes music store sold 1 million songs in each of its first two weeks in business, purchases have plateaued at an average of 500,000 downloads per week. Meanwhile, the Windows download site BuyMusic.com has yet to take off. It hasn't even generated enough traffic to rank on Nielsen's weekly most-visited-sites charts.

"How we view success is not the day-to-day ticktock of file sharing," says an RIAA representative. "Ultimately, we hope fans will migrate to legitimate services."

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