File-Sharing Crackdown

The Supreme Court ruled yesterday (June 27) that peer-to-peer networking sites can be held liable when their users swap music, movies and other protected works without the copyright holders' permission. The high court, in a unanimous decision, overturned a U.S. appeals court ruling that had shielded the P2P networks from copyright-infringement suits as long as the sites were also used for legitimate purposes. Justice David Souter wrote: "One who distributes a device with the object of promoting its use to infringe copyright ... is liable for the resulting acts of infringement by third parties."

Within an hour of the announcement, the Consumer Federation of America, Consumers Union and Free Press issued a release denouncing the ruling, arguing that it poses "a significant challenge for consumers, innovators and the economy" but never quite making the case for why the ruling is bad law.For instance, in trying to counter the entertainment industry's claims that P2P networks are copyright-infringement schemes, the consumer groups state that such networks are more popular and efficient than conventional media distribution outlets. OK, so they're popular and efficient. So are many other black markets, but that doesn't give them the right to traffic in stolen goods.

The groups also argue that the ruling reinforces the entertainment industry's "near monopolistic control over the prices consumers pay and the choices consumers make." Monopoly how? Myriad music labels and movie studios distribute through myriad brick-and-mortar and electronic outlets. If the industry is somehow fixing prices, let the Federal Trade Commission make that case.It's in the entertainment industry's best interests to seek out the cheapest, most efficient distribution outlets, but it's not going to stand by as its content is pirated and given away. There's no such thing as a free lunch, even on the Internet.