Online music copyright infringement:
Facing the Music: When Digital Technology and the Law Collide
© 2002 Dr Maria Chetcuti Cauchi. All Rights Reserved.

The music industry has often claimed that the internet is “a web of piracy” designed to rob it of its rightful revenues. In recent years, the basis of the music industry has been challenged by new technologies and the question has often been asked as to how traditional copyright law can protect music in this digital day and age. This article addresses some of the major issues facing music in the internet era.

The Crux of the Problem

Music is transmitted on the internet digitally. Unlike its analogue counterpart (e.g., audio tapes), in each reproduction, the digital format preserves the original high quality of sound. Internet music exists in two digital formats: the compression format, such as WAV or MP3, which is typically downloaded in its entirety before being played by a user, and the streaming format, whereby a host transmits small “packets” of information to the user, which the user accesses in real time.

In the last years, the foundations of the music industry have been threatened by new technologies, most notably MP3’s.  Even though the online transfer of digital audio files was possible before, it was too cumbersome and time-consuming.  In the MP3 format, downloads of audio recordings are now much faster and take up much less space on a hard drive. Now most listeners can use this format to exchange music with one another. Feeling the pinch, the music industry has been lobbying hard for the adoption of the US Digital Millennium Copyright Act and the EU Directive on Copyright and E-commerce. Both pieces of legislation bestow on copyright owners the entitlement to make use of “technical measures” to protect retrieval and reproduction of works and make it a criminal offence for anyone to devise means to circumvent those measures.

Two recent cases demonstrate how the courts have applied traditional copyright law to music on the internet. In UMG Recordings, Inc. et al v. MP3.com, Inc. (2000), MP3.com provided a service whereby users could access a digitised version of a CD they already owned via internet. This is also known as space-shifting. Ownership of the CD was verified by making the user insert the CD into the CD-ROM drive of their computer, or by purchasing the CD online with the MP3.com service. MP3.com claimed it was merely “storing its subscribers’ CD’s”. Engaging in a fair use analysis, the Court concluded that all the elements weighed against a finding of fair use and  concluded that the defendant was liable for unauthorized copying. The Online Service Provider had made copies which were undisputedly for a commercial purpose.

A&M Records v. Napster, Inc. (2000) concerned a service whereby users could share MP3 files. Napster argued that it was exempt from liability under the US Digital Millennium Copyright Act which provided a safe harbour for the transmission of files through an Internet Service Provider in particular circumstances. The court held that this exemption was inapplicable as the MP3 files were not actually transmitted through the Napster system as in the case of ISPs. The court found that Napster users were engaged in direct copyright infringement as the music file swapping between Napster users was commercial in character and the use of the Napster programme reduced the sales of CDs and raised the barriers for record companies’ entry into the online market. This was the necessary prerequisite to establish contributory or vicarious infringement in Napster. The defences of fair use and substantial non-infringing use were rejected by the Court. Napster had knowledge of its users’ infringing activity, had materially contributed to it and had a direct financial interest.

Record Companies Launch First ‘Legal’ Music Online

The music industry did not move quickly enough to develop services of its own. However, on 4^th December 2001, the first internet music service, backed up by leading record companies was launched, thus giving consumers the chance to download music on to their computers in a ‘legal’ manner.

The problem is that the system offered by the music industry leaves much to be desired and is constrained by a number of shortfalls. If a subscriber allows his membership to lapse, he loses access to already downloaded music; there can be no CD burning, no sharing, and no ownership of the songs and there is also a restricted number of hits available. The challenge seems to lie in persuading users to pay for restricted features rather than resorting to superior ‘free’ music offered by other distribution sites.

Nonetheless, there is still comfort in the knowledge that this is just the music industry’s first step.  Hopefully, teething problems will be overcome and services will gradually improve and become more competitive. It is also claimed that such ‘legal’ music is higher in quality and free from viruses. The forthcoming months will show whether such move by the music industry was the best move to resolve the problem of online music copyright infringement.

© 2002 Dr Maria Chetcuti Cauchi. All Rights Reserved.