The U.S. Supreme Court, which was deeply divided in multiple ways on the Ten Commandments, has been perfectly clear on one of them: "Thou Shalt Not Steal" copyrighted material.
In MGM vs. Grokster, a unanimous court found that the peer-to-peer ("P2P") networks established by Grokster and StreamCast Networks encouraged illegal uploading and downloading of copyrighted music. The high court declared: "one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties."
The Supremes went through some pains to do their homework on the nuisances of the technologies and marketing techniques at play, But more than anything their decision brings to mind the late Justice Potter Stewart's famous observation in a 1964 pornography case: Stewart noted that while the legal definition of pornography was convoluted, "I know it when I see it." In this case, the high court looked at the Grokster and StreamCast products and what they saw was theft.
Intellectual property rights in the digital age, in fact, bears a striking resemblance to pornography law in the '60s -- the nature of the problem kept shifting faster than the law could keep up and the line between legal and illegal grew increasingly murky. Tiring of the seemingly endless parade of cases on the issue reaching the high court, the justices finally set up a standard under which some of the decision-making on porn was left up to trial juries while broader principles were left to judges and appeals courts.
At the time, neither civil liberties advocates nor anti-pornography activists were happy with the ruling -- and they still aren't -- but the flood of litigation reaching the Supreme Court slowed. (Admittedly, in recent years that may be more a factor of Internet porn replacing the local smut shop.)
In Grokster, lower courts had thrown out the lawsuit citing the 1984 Supreme Court "Sony" decision that had OK'd VCRs on the grounds that technology that has a legitimate use cannot be banned. The Supremes upheld Sony but rejected its use as a blanket legal defense and added the new test of whether the company is marketing the technology in a manner that encourages illegal use. Again, this is the same path as obscenity law where a 1965 ruling held that the publisher of material that was not necessarily obscene itself nevertheless could be convicted because he promoted the material as smut.
One wonders, given this parallel legal evolution, what the court would rule in a case in which someone developed technology to let users hack into a pornographic web site.
But I digress. There is more than whimsy in the porn-P2P analogy. "Adult Entertainment" is the one branch of show business that not only has adapted to new technologies but has prospered because of them. Videocassettes, DVDs, cable TV, and now streaming video have generated returns far beyond those possible from showing dirty movies in seedy theaters or at stag parties. Digital video has sharply reduced production costs and increased profit margins. The Internet has proven to be a far more effective distribution system than sleazy bookstores.
One lesson here, of course, is that sex sells. No doubt when technology reaches the point where media disappears altogether and content is beamed directly to the brain, the porn industry will be the first kids on the block to cash in.
But the other lesson is that technology can be a boon to the entertainment business, not a threat. XXX producers went after the video and Internet marketplaces themselves and put a stranglehold on it while their more respectable brethren sat back and let the pirates make the first moves.
Apple Computer with its iPods, iTunes Music Store, and aggressive marketing of them has done more to build a legal digital music business than the music business has done. Record companies, in fact, have forgotten the tricks of their own trade. In the days of vinyl records, customers would happily pay disproportionately more for a single than for an album just to avoid being stuck with filler tracks. This is, after all, how "one-hit wonders" came to be. The music industry could have recaptured the singles market by embracing digital encoding and the Internet. Instead they are trying to put the digital genie back into the bottle.
When the dust settles from the Grokster decision, the music and movie industries are left with two fundamental realities: first, the high court has only ruled against blatantly illegal behavior; legitimate technologies still are legal. Second, the music industry is still looking at poor sales while the movies' box office receipts are in a slump and at the end of the day the Grokster decision isn't going to change that.
