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October 27, 2004

Grokster Officals Settle Separate Copyright Case

Reuters reports:

Officials with the Grokster file-trading network have agreed to pay $500,000 to settle charges they operated a separate music download service without permission, a recording-industry trade group said on Monday.

Puretunes.com allowed users to download unlimited songs for $24.99 a month.  The RIAA claims that the company never got permission from copyright holders.

In addition to the $500,000 by Grokster, the settlement orders Puretunes.com's parent company to pay $10 million.  However, Grokster President Wayne Rosso claims that the company no longer exists.

In other cases, courts have ruled that Grokster is not liable for copyright infringement because it lacks control over users.

When I went to puretunes.com (laced with pop-ups) today, I found a listing of music search results.  The third result claims "Unlimited Music Downloads - $0.99/Month."  If $24.99/month is too good to be true, I suspect that this sponsor is also selling some snake oil.

If you're interested in how the puretunes.com site looked prior to the lawsuit, you can look here.  I think the idea sounds like a good one.  $24.99/month to get the music without breaking the law may entice some music thieves to change their ways.  The real problem with music swapping is that people didn't know they were doing anything wrong in the beginning.  Now that they know, they're addicted to the free music.

Some claim a new business model is in order.  Others claim that it is unfair to force the IP holders to change their business to thwart thieves.

I agree with both positions.  It is unfair to force the lawful IP holders to make accommodations for law breakers.  However, it's probably in the IP holders' best interest to do so.  It's like installing locks on a house.  We shouldn't be required to install locks on our houses to keep burglars out, but we install them anyway.  Like personal jewels or electronics, IP is an asset that requires protection beyond ownership.

Posted by at 11:22 AM.
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