Information

Who should control the information?

Should certain types of information be controlled or banned - and by whom?

Information has the power to change people's thinking and behaviour. Such changes can see some people get richer and others poorer.

Because information can have enormous power, some governments in the world are now faced with the dilemma of how to control or even ban certain types of information available through the Internet (or elsewhere). Of particular concern to the authorities are sexually-explicit material and Internet gambling (1).

In Australia, the current Federal (Howard/Liberal) Government has attempted to look at this issue with incredible finesse. Their solution: to spend millions of dollars of taxpayer's money trying to ban sensitive information by closing down web sites in Australia and frightening Internet content providers from publishing the material through the use of hefty fines, extra law enforcement officers, and changes to the Australian legislation.

Banning information or even restricting it in some way is a futile exercise at the end of the day. This has been clearly illustrated on the Internet where a banned site can reappear in a matter of a few hours on an offshore server. And even if a site can be banned anywhere in the world, people will go underground and distribute the information through other channels.

Or worse still, the large number of free ISPs worldwide are supporting a large number of anonymous web sites. Ban one anonymous web site hosted at one free ISP and the person responsible for the site will simply move to another free ISP. The person can then randomly upload the information from any public internet machine anywhere in the world if he/she so chooses.

Hence the Australian Government's attempt at applying their own limited jurisdictional powers on the banning of certain types of information does not extend to deciding the information policies of other countries. And even if they could, the Australian Government would have a bugger of a time working out who is responsible for making an anonymous web site.

To see how ludricrous this approach is, click here to read a newspaper article we received from Australia as published in The Australian dated 27 February 2001, page 55, entitled Censor Bill gets R rating.

The only effective answer is good quality education together with the essential social support needed for everyone to survive and able to contribute to society in their own way.

Internet gambling - an example of how the government is trying to control information

Let us look at an example of how one government is trying to control information for whatever reason.

As of 28 June 2001, the Australian Federal/Howard Government has somehow managed to convince themselves that no Australian after 2001 will be in debt because of an Internet gambling site!

You may be wondering, "How?" Well, Australian legislation has been passed in the Parliament banning Internet gambling sites from ever establishing themselves in Australia and to implement a system in six months time known as an "unenforceable contract provision" whereby many overseas gambling sites will not be able to receive Australian electronic transactions (i.e. through the credit card system) to pay the debts of Australian customers who use their sites.

Baptist Minister Tim Costello, a fervent supporter of this approach has praised the move saying:

"It is quirky and ironical that the nation that has boasted of being the greatest gamblers in the world now have another first—if you actually win with online gambling and you are Australian you can collect your winnings but if you lose you can make the contract unenforceable." (2)

While we appreciate the enormous time and effort spent by the Federal Government to control what we believe is a serious growing social problem in Australia, the problem still remains. What if the overseas Internet gambling sites accept International money order through the post from Australian customers? The new legislation will be helpless against this approach.

As Stephen Smith, Labor's communications spokesman, said to reporters: "We've got a hypocritical unworkable dog's breakfast." (3) In other words, the ban on Internet gambling is riddled with flaws.

We think it is far better to give the Australian people (and by implication the rest of the world) a good education and the means to survive while at the same time encouraging them to try something different instead of relying on Internet gambling to solve all their social and financial problems. And that support should also include letting them know everything they need to survive will be taken care of.

Unfortunately for the current Federal Government, that will mean learning to become a compassionate government when solving these kinds of social problems. Can the Federal Government become more compassionate? Or will the idea become another one of those famous predictions that will fall by the way side just like the one we heard from a famous Australian politician nearly a decade ago about how no child in Australia will live in poverty after 1990? (4)

Others ways for the Australian government to control information

In yet another extraordinary attempt to control information by Australia's very own Dad's Army known as the Australian Federal (Howard/Liberal) Government, the Australian anti-espionage legislation has been tightened, simplified and made more prominent in the minds of the general public as a method of frightening people into not releasing and publishing unauthorised official government information.

To make it just that little bit more of an incentive for people not to release unauthorised government information, the maximum penalty has been increased from seven to 25 years imprisonment.

Australian Prime Minister John Howard. Source: The Canberra Times, 6 October 2002, p.1 (Picture from Gary Schafer)

What is this anti-espionage legislation about?

The anti-espionage legislation is about giving governments the legal power to not only prosecute the informant (e.g. the whistleblower, spies etc), but also the journalist/publisher for any unauthorised release of official documents. Essentially it will affect anyone who works for the government and those knowingly receiving unauthorised government information.

Will the anti-espionage legislation give the government total control of all information?

No. It will just make people think more carefully about whether or not to release government information to the public or foreign power.

Who will be affected by the legislation?

Updated in February 2002, the impending new Australian anti-espionage legislation bill to be debated through parliament is not just designed to curtail the handful of intelligence analysts like those working at the Australian Security Intelligence Organisation (ASIO) and the Defence Signals Directorate (DSD) from deliberately releasing/selling secrets of potential risk to the national security of Australia to foreign powers. The legislation is also there to make it just that little bit more difficult for anyone working in a government department or knowingly receiving and publishing unauthorised government information to inform the public of any action and/or decision made by the government which is of concern to the public.

This means Ministers who rort the system, public servants who discover unethical and dishonest behaviour, administrative bungles, or anything else that the public deserves to know the truth about, are likely to be kept hidden from the public, and not just those sensitive information of concern to national security. This has to be a dangerous development for democracy in Australia. (5)

But we should take heart in the fact that this "updated" anti-espionage legislation is only effective if the government can identify the publisher and the informant. This is where a simple technology like the Internet is such a powerful tool for making a complete mockery of the legislation.

The Internet - How to make a mockery of government control of information

For example, it doesn't take too much effort to set up a web site on the Internet. And it doesn't have to cost anything to the publisher or informant. And the beauty is that you can do it all anonymously. Yes, it's the old dirty word for any government. Be anonymous, and you can start to send shivers down the spine of even the most powerful authorities in the world. In other words, go to a free ISP, use an anonymous name, a bogus address and other so-called "personal details", and then start building your own web site.

Then, from the comfort of any number of local public Internet cafes, public libraries, or mobile/standard phones temporarily "borrowed" from other people without their awareness in the country, upload a digital copy of any documents you want published (it should take no more than a minute). Finally, without revealing your name or the informant's name, just place one single innocuous little advert in an online newsgroup or use a public fax service from Australia Post to notify the media of the presence of your very interesting web site. Thereafter, everyone will know about your web site and there is no need to advertise any more.

To make it even harder for the government to track down where you are, consider setting up your web site in another country. In that way, you keep the government wondering whether you are living in that country or not.

But don't just stop there! Why not rub "salt into the wound" so to speak by creating another web site and say you are a publisher/reporter and your job is to talk about anything you see online of interest to you and the public. Then say you have just found this interesting offshore web site containing some rather sensitive information and have made comments about it. The law cannot get you into trouble simply by reading and commenting about the sensitive information because the information is already there for everyone to see and the government has no proof you have received the documents from an informant, or whether you are the informant responsible for publishing the information.

In other words, the publisher and the informant can be protected from legal action (or even from people requesting subpoenas in getting personal information from ISPs on anyone in the Internet under the Digital Millennium Copyright Act) through anonymity. And the laws that were suppose to be designed to plug some rather embarressing leaks within government (or military) circles are completely by-passed using this very simple and effective technique.

UPDATE

Rumours have it that the current Federal (Howard) Government is contemplating the move of having a new leader replace Mr John Howard, with Mr Peter Costello likely to take over as the new Australian Prime Minister.

Australian Finance Minister and likely contender for the next Australian Prime Minister, Peter Costello. Source: The Australian Senior, June 2002, p.5.

The official explanation for this contentious move within government circles, or so we are told, is because Mr John Howard can formally retire from his position as Prime Minister because of his age. However, unofficially, there is a growing suggestion that the move is an attempt to detract the public focus on the numerous blunders and poor government decisions in the past under the reign of Howard and to shake off its now infamous "Dad's Army" image outside government circles.

Why must the authorities control information on the Internet?

The Internet, with its lack of effective worldwide and enforceable censorship laws, certainly does bring out two sides to humanity - the good, and the bad (or ugly). Although what is good or bad is a subjective thing and something for which the people must decide for themselves depending on their circumstances, how well educated they are, and how useful the information is to their lives as well as the future of society as a whole, sometimes the easiest way for government to deal with what they believe to be the "dark side of humanity" is by restricting certain information from people who "cannot handle the truth".

But as with so many things, eventually people will find out the truth in one form or another given enough time and access to other relevant resources. Therefore, it is far better to help people "handle the truth" in a responsible manner by providing quality and balanced education, and that means showing all the consequences to its deepest level and then allowing people to decide for themselves what to do with that information for the benefit of all living things.

As Nicola Court, a writer for the Australian magazine Internet.au, said:

"Even if you shut down the Internet, people will find a way to distribute things...Legislation to shut them down, and legal action against them is not the answer to them. Education is." (6)

Why do we need education and other forms of support?

To ensure people do the right thing, we all need education and to give them what they need to survive. Because ultimately it is the people themselves (no matter what age, race or social status) who will eventually discover that side of humanity which the governments of the world may want to hide. It is far better to educate people and give them what they need now so they can decide later what to accept or ban in their own minds, because they are ultimately the ones who will learn to use that information in the future, hopefully in a positive way, depending on how we treat people in today's modern society.

Yes, the government can attempt to control all types of sensitive information using any kind of covert or overt "whack in the hand with a ruler" approach. But it has to be realised by everyone that people will eventually find out what is being controlled or hidden from the public. Some people may not like it, but that's the fact of life.

Even if the government (or some other authority) tries to directly stop the information from getting through normal communication channels such as a web site, it will simply push the information underground or go elsewhere to another country where it would be much harder to control by the government, but only those who know how to access the information will be able to do so quite easily.

If the government is truly concerned about whether the information will be applied in a socially responsible way, then start giving good quality education and other forms of social support including making sure everyone has what they need to survive. Because in the end, it is the people who will find out about the sensitive information and will decide for themselves how it should be controlled, applied, and made available in whatever form they consider best for the good of all.

Why are governments so worried about certain information that they have to control it?

The only reason why the government would try to control information is because they know there are people out there who are not being properly supported in society and who might use that information in a negative way in an attempt to rebalance the injustices and hardship.

Why aren't people being supported properly? Perhaps it has something to do with the existence of certain poor social government policies, a complicated legal system favouring the rich and powerful (irrespective of whether people are right or wrong), and how the current "Westernised" system promotes certain people to earn and grab so much resources simply because greed for these people is not seen as a bad thing. Who knows? But if everyone in society are to feel truly safe living with everyone else, we must work towards providing much greater social support than ever before. And part of that support should include education as well as helping people to have what they need (and not what they want) and to encourage them to achieve something on their own for the good of society.

Because the more we treat people differently and in a negative way, the more the authorities have to control certain types of information, and the more likely there will be a growing number of people who will start to suffer and even rebel against the authorities as they lose out on getting the proper social support they need. And as people get richer and the laws get more complicated, the cost to the government of handling the extra social problems suddenly goes up (probably because most of the money has to be spent on expanding the law enforcement agencies, defence forces, and the legal justice system) and there is afterwards insufficient funds to help the people in those proper areas of the social system which is far more critical than spending money on security and defence.

And once these people fall through the cracks of society, they will be the ones who we have to be concerned about.

So remember, if we want people to apply whatever they have learnt from any kind of information in a constructive manner, it is important for the people who are exposed to the information to be treated well and given the appropriate support to do the right thing by everyone.

Should information be regulated?

It is now becoming clear. People are looking for quality information. If this was not true, then we should ask ourselves, "How many of us would want to read an encyclopedia of text if a few pictures, well-chosen words, and good sound can do the same job of telling the same story or explaining the same idea?"

So how do we increase the quality of what we absorb everyday?

Perhaps, as some people have suggested, the answer to the problem is total regulation of all information.

Certainly the information on the Internet is unregulated and, as a result, people are finding problems in extracting concise, accurate and/or relevant information in a quick and easy manner. According to the media consultant for the Australian television Seven Network, Ms Dina Browne, with 30 years of experience in the television industry:

"The Web is different because it's unregulated. Anybody can publish on the Web, even though it may just be a single, personal perspective. [However, this can be a problem because] unless you have a great deal of experience, it's hard to know what information is accurate or relevant and what isn't." (7)

While regulation may improve the quality of information, the total regulation of all information is also not the answer, as this will stifle creative expression and original research work, as well as stopping those lesser known individuals and organisations from using the medium as a way of formulating new and innovative ideas.

There has to be a balance. On the one hand, an effort must be made to improve the quality and accuracy of the online information today. On the other hand, we have to be very careful not to put a brake on the potential of a much larger society to create new ideas and ways of seeing and doing things of benefit or potential benefit to everyone, even if it means starting off generating mediocre information in order to begin the process towards generating much higher quality work.

Will the Internet ever be regulated?

That's a question best answered by the very people who publish information on web sites. The answer depends on the type of information being published online, how it affects people in different parts of the world, and whether people can deal with potential criticism or controversial issues presented in the information in a positive way (i.e. as an opportunity to learn and improve what we are doing).

Certainly the most likely scenario for supporting the regulation of the Internet is if online publishers (and that means anyone who creates a web site) publishes very specific information that may put some people or companies in a consistently bad light resulting in financial loss and there is no good evidence to back it up.

However, if the specific information about someone or company is able to be deduced from readily available sources, or the direct or indirect (or intended) claims made in the information can be fully justified with good evidence as well as showing a clear "need to know" benefit to the general public in having that information published, then there is usually no problem. And if you provide solutions, and not just the problems, then that is even better for it will help everyone to be a better person.

A classic example of where regulation of the Internet could be introduced is the court battle between an Australian businessman named Joseph "Joe" Gutnick (who made his millions in mining) and the publishers of the Wall Street Journal. In the words of The Canberra Times reporter Crispin Hull in his article entitled Free speech lost in outdated web of law, Gutnick claims the US publishers of the journal had defamed him because an article was published in the journal alleging that:

"...Gutnick was the biggest customer of the jailed money launderer and tax evader Nachum Goldberg, and that Gutnick was masquerading as a reputable citizen when he was a tax evader who had laundered large amounts of money through Goldberg and had bought his silence" (8)

Flamboyant Australian businessman Joseph Gutnick taking on a US company in the courts for publishing allegedly false information about him.

Is this statement fully justified? Is it worth the risk to defame an individual in this way? Well, the US publishers who wrote (or supported by publishing) this statement may have found a link between Gutnick and Goldberg at some moment in time. But to make the next obvious intended assertion that Gutnick was a devious businessman is a dangerous one.

What leaves the US publishers open to serious litigation is the fact that no where in their claim did they provide proof of Gutnick's alleged dubious and shady character.

In the US, this kind of negative sweeping generalisation of someone may be okay because in that country publishers are not required to prove the truth under the US freedom of speech laws, but rather prove the publishers had acted reasonably, had an honest belief in what they had published, and was published without malice. But in Australia, things are a little different. Current Australian laws require that publishers prove the truth before stating it, especially if it will affect other people in some adverse way (usually of a "financial nature").

Although the Australian law courts are still hearing the case and deliberating over the evidence as to whether the publishing of information on a US server constitutes publishing in Australia and therefore subject to Australian laws just as much as US laws, it is this kind of situation which would probably make people like Gutnick believe that a regulation of the Internet would be justified under these grounds.

UPDATE
10 December 2002

A landmark High Court of Australia ruling on Internet publishing has been made today. Any material published by anyone or any organisation on any server in the world will be subject to Australian legislation. So if you defame people in Australia resulting in some kind of financial hardship after publishing something online, you could be taken to an Australian court. And the airline ticket you may receive from Australia won't be for an overseas holiday!

Possible solutions to the problem of regulation on the Internet

So what do you do to get around this Internet regulation problem?

If you want to minimise regulation while still retaining the freedom of speech to say what has to be said for the good of society, then our preferred method is to present your information in a balanced way. This means not only helping people to see the problems (i.e. the past), but also to reveal the solutions (i.e. the future), together with clear evidence in support of all your arguments. And most importantly, include a clear legal statement and contact details to allow readers to provide additional and more accurate information to you and to ensure the views expressed in your published material by someone else who has written it is not necessarily the view held by the publishers or the company in general.

In that way, you will always be legally safe from any defamation case that may be brought against you or your company, especially while we live in a "sue-everyone-for-everything" kind of world.

Or consider this amazing idea: try to show the positive side of people and what they have achieved. The chances of you becoming defamed in the courts for publishing incorrect positive information about someone is virtually zero!

Or, if you have to publish something negative that is not backed up with adequate evidence and could affect some powerful people in the world, make sure it is published on an anonymous free web site such as http://www.geocities.com/ and upload the information from a public Internet machine. There is virtually nothing anyone can do to you except try to close down the free web site.

And just in case the authorities somehow manage to track you down, don't own anything. People will find it a waste of time suing you for millions of dollars if you don't have the money or assets to pay for it.

Or, if you have got the money and you need to say something to the world, try this idea: go to a third world country, disguise yourself, and then pay an anonymous poor person to do a once-off upload of your information on your behalf. By the time the authorities realise where the information came from, any mention of the phrase "third world country" and "the poor" will almost certainly stop them from suing someone in an underdeveloped nation.

Should information be freely shared or sold?

This is another one of those great questions perplexing the experts involved in the creation, distribution and sale (or sharing) of information. It involves restricting information in so much as to ensure people pay a fee before making the information freely available to the purchaser.

To put it succinctly, we have one group of people arguing that all information that can be sold should be sold right down to its last drop for all eternity (i.e. the ones who believe "there is no such thing as a free lunch"). While another group of people wants to argue that once information reaches down to enough people, it is much harder to make a profit from the information and therefore should be publicly-owned and shared with others freely (i.e. the ones who believe "some things should be free to everyone") so that those in less fortunate positions in society can benefit from the information.

Should everything be paid for by everyone for all eternity or is it possible for some things to be shared or received for free?

This is a particularly notorious problem on the Internet because there is still much discussion going on between the record companies with their digital AIFF format for playing and distributing music on CDs and the internet gurus with their file sharing software program that can turn any personal computer into a server for freely exchanging people's own MP3 music files.

NOTE: MP3 is the file format for the technology designed to compress digital music stored in the AIFF format with minimal loss in music quality. The compression technology has permitted people to quickly distribute the compressed music through the Internet because a 600MB CD can now be compressed to 50MB. Or a 40MB song can be compressed to 2MB.

On one side of the argument, the record companies believe that the original artists and the companies creating, publishing and distributing the music are entitled to have the sole exclusive rights to sell and make a profit on the music at any time and at any place for all eternity.

On the other side of the argument, the Internet gurus have a philosophical argument that once the music has been sold to a large number of consumers, there is nothing stopping them from choosing to exchange their music for something else in a kind of 'free love' approach to sharing ideas and helping others.

This latter argument is quite common in real-life. You hear one person say, "Can I borrow your CD tonight and I'll give it back to you tomorrow?" and the other person says, "Okay." or "Alright then, so long as you don't mind if I borrow one of your CDs tonight as well."

The Internet just makes this process of freely exchanging music more efficient and quicker to achieve than doing it in person.

Unfortunately, the record companies quite rightly argue that if everyone did this, the music industry would rapidly lose a substantial part of their huge profits as soon as the latest music reaches the music shops. However, the Internet gurus will argue that people have been doing it without the help of the Internet for as long as people can remember and it has not stopped the music industry making a profit.

Also when the music is eventually sold to a large number of consumers, the music should effectively be seen as public property because it is virtually impossible for record companies to keep a tab on where all the music has gone after it has been sold and there is little prospect of making further profit on the sale of the "old" music (9). And anyway, do music companies want to sell old music, even the ones more than 30 years old given how hard it is to buy an old record or CD?

Hence all the special freeware and shareware software programs for exchanging MP3 music with others merely makes it more efficient and quicker to share these "older" types of information around.

So what's the solution?

There has to be a balance. While companies like the Recording Industry Association of America (RIAA) and other groups representing the recording artists and labels are entitled to earn a reasonable profit for their work, a time will come when the music will have already reached enough people in society to the point where any further production of the CDs would be unprofitable or would be too difficult to police where the music is being shared for non-profit and personal use.

It is therefore recommended that file-sharing commercial servers like Napster implement an effective filtering technology to stop people from exchanging the latest music but still allow older music to be exchanged without a hindrance (10). Why? Because the author/publisher/company are entitled to recover costs and make a reasonable profit from the latest music. But the music companies must also realise a time will come when the music will be in the hands of so many people that sales must go down and eventually unprofitable to continue making and selling the CDs. So perhaps the companies should consider a system whereby they (i) set a minimum number of CDs to be sold in order to meet company requirements; or (ii) set a maximum time after which the information can be shared around by the masses.

It sounds simple in theory, but can it be put into practice? Probably not. Unless companies can learn not to be excessively greedy and everyone else can be properly supported and able to have what they need so they will do the right thing, it seems unlikely such an approach can be implemented. Why? Because as soon as people purchase a new CD, the music usually gets shared around on the Internet almost straight away (in return for other free music) using non-commercial free peer-to-peer file-sharing software. (11)

Even if the record companies could come up with a clever piece of technology to modify the format of their music on CDs to make it virtually impossible to share on the Internet (12), or even develop powerful new MP3 filtering technology on the Internet to stop everyone from exchanging a "new" copyright music straight away, people will eventually circumvent the restriction. For example, it would not be unusual for people to connect the external speaker connections of their stereo system playing the new music format to their computer (using a slightly older operating system) and start digitally "re-recording" the music with the help of readily available free sound recording software. Or someone could develop a new peer-to-peer file-exchange software that renders existing MP3 music filtering systems useless.

Or maybe the key is to get everyone with Internet access to register their IP address and location on a centralised international database system. In that way, any unauthorised release of certain "music" files will have enough information embedded in the files to track down the person responsible.

But who or what would be policing the Internet in this situation? It would just be too big and there are too many files to process. Also such a situation can be easily fooled if say one person decides to change the information into another file format and/or perhaps embed the information into an innocent looking graphic file in a process known as stegnography. Once the file is downloaded on someone else's machine, the other person can choose to reconvert the files back to the preferred format or extract the hidden information.

To make things more disconcerting for the record companies, people could decide to encrypt the files and send them to others using anonymous email software technology instead.

The technology available today is so powerful that it now takes only one anonymous person to defy the record companies' efforts to place restrictions on the sharing of music to the rest of the world. A recent study by Xerox PARC researchers discovered that 70 per cent of people using the file-sharing Gnutella program did not contribute not one single file of their own, and that over half the files that were being shared were provided by just 1 per cent of the Gnutella users.

The lesson is clear. It only takes a very few people to cause a massive headache to the record companies using the right technology. If we are to solve this problem, we have to take a long and hard look at ourselves and the social system we have developed. We have to make sure whatever we do will properly support everyone to freely create original works and to do the right thing by everyone else, and in return receive what they need to survive for the rest of their lives.

How are we going to achieve this? Well, the present system is clearly not working with all the problems we are creating. We have got to start bringing greater balance to everything that we do right now.

Clearly, there is a serious problem to be solved here. Or do we need to change the ideas of the capitalist world by redefining what it means to work, live and support people? Is there a more balanced social system we can implement to ensure people are free to create and distribute original works while at the same time guarantee their effort will be properly rewarded (i.e. by having what they need for the rest of their lives) rather than giving them money?

As George A. Chidi, Jr. said in the June 2001 edition of Australian PC World:

"Presently, consumers are swimming in a huge pool of pirated [or shared?] music, and the music industry hates that. This leads to a second block: the competing interests of record companies, retailers, artists and electronic device manufacturers in developing effective digital-rights management for protecting music copyrights. This issue is still far from over." (13)

UPDATE
January 2002

In an attempt to plug the rather big cyberhole created by Internet gurus at Napster (the head office was formerly located in Redwood City, California, USA at time of writing) and now by other people with their free peer-to-peer file-sharing software technology, three of the five biggest music industry giants - EMI, AOL Time Warner and BMG - along with commercial digital online music specialists RealNetworks (i.e. the makers of RealPlayer), have announced in May 2001 a brand new online music distribution service platform.

Now commercial distributors can sell digital music content on the Internet from the big record companies so long as they pay the consortium (known as MusicNet) a license to do so as well as purchase the new technology from RealNetworks to make the whole thing work. Users will then be able to both listen and download the specific tracks they want from the service at a cost determined solely by the distributor. The cost might be a time-limited subscription, or a track-by-track basis, or the number of times the music can be played for, whatever the distributor decides.

As David Munns, chairman and CEO of EMI Recorded Music North Amercia, said:

"This is the next step in our plan to give consumers our music in the formats they are demanding today." (14)

However again, like buying a music CD from the shops, eventually people will have in their possession a copy of the music (this time on the hard disks of computers). And the original problem of sharing music with others freely in exchange for other music has not been stamped out.

And then there are new issues to consider with the new commercial music distribution technology. For example, what happens if the music gets accidentally wiped off the hard disk. Will users be able to return and download it again without having to pay the same costs as before?

NOTE: Olympus Music has got the support from Sony BMG, Festival Mushroom Records and EMI to sell music online as of June 2005. More importantly, Olympus will record your download history and payments so even if you lose your music, you can get another copy for free (if you have paid for the music in the first place).

Until the music industry giants and the Internet gurus can sing the right tune, like the people would say, "It ain't over until the fat lady sings". The battle between the freebies and the greedies must go on....

UPDATE
June 2002

MP3 music continue to be freely transferred using the standard peer-to-peer technology. And now there are commercial web sites that will allow MP3 music to be downloaded for free (the licensing fees and royalties are paid through the advertisements the music industry and other companies make on the web sites). For an example of this, visit:

http://www.qtrax.com.au/

Or try KaZaA. This company is now offering free access to copyrighted music and movies. Although KaZaA's parent company Sharman Networks, headquartered in Australia, is currently facing a lawsuit for possible infringement of the US copyright laws concerning file-swapping on the Internet, you can still download whatever you want without restriction.

Or you could try Shareaza and Gnutella for alternative free file-sharing programs, not to mention the more obscure ones out there.

In the meantime, Napster has filed for bankruptcy in the US at the start of June 2002 just two weeks after the media group Bertelsmann AG of Gutersloh, Germany, agreed to acquire the troubled company.

According to an anonymous Bertelsmann official, the German company feels there is a future for peer-to-peer technology in the music industry. Well clearly not in the way Napster had tried to implement it after being forced to ask customers to pay a monthly subscription fee. (15)

Perhaps the German company has new plans for the technology? We can only wait and see.

UPDATE
September 2002

The German media company Bertelsmann AG is almost certain to purchase the remaining assets of Napster before the end of September 2002 (16). Although it is still unclear exactly what the company would do with Napster, there is every likelihood the company will relaunch Napster into a legitimate subscription-based music-swapping business.

Competition for this kind of service will be fierce as Bertelsmann is expected to run up against the likes of MusicNet and PressPlay, all backed by the major labels in the music industry.

With so many free peer-to-peer file sharing software still available on the Internet, we wish the company luck in their endeavour.

Microsoft Corporation may be quietly stopping people from creating MP3 music

There is a rumour going around about the latest security updates for Microsoft Windows XP and Windows Media Player. Apparently the updates are designed to disable certain third-party software products Microsoft does not like.

According to Tom Trottier of Ottawa, Canada, he alleges that Windows XP (SP1) with Windows Media Player installed may disable programs designed to convert a CD track to an MP3 file (17). Microsoft supports this kind of activity in the MS End User License Agreement for XP (SP1) and WMP where it says:

"These security-related updates may disable your ability to copy and/or play Secure Content and use other software on your computer."

Although such a move on MP3 files is not known to exist on the Apple Macintosh computer, Apple Computer, Inc. is attemping to restrict what people can do through the operating systems MacOS9 and MacOSX, such as pasting a custom icon onto an Apple Disk Image file. Why? Presumably to help Apple and participating Apple resellers/vendors to see what kinds of applications and files you use for law enforcement, marketing and other purposes.

With worldwide IT spending worldwide significantly dropping after 2001, this could be the way the bigger software manufacturers are forcing you to upgrade and buy the software they are happy with.

Is this the way all software manufacturers will eventually control the information you use and produce on your computer?

UPDATE
January 2003

It is official. Microsoft has announced on Monday 20 January 2003 a new range of copyright protection tools that will allow music companies to restrict the use of CD and DVD disks on personal computers.

It would appear the aim of Microsoft and the music companies is to add a protected "second session" of the sound and video information onto the CD and DVD disks for use in personal computers and then owners of the latest Microsoft XP operating system will have the tools to read this "second session" and follow the rules for the use of that content.

For example, a music company can record on the CD and DVD disks the rule that a customer can only play the disk a certain number of times on a personal computer as well as restrict copying of audio and video information from the disks to a portable device or the hard disk.

Unfortunately we keep seeing a slight problem with this "crippleware" approach. What if a customer has an old second-hand computer running an older version of Windows and a number of older utilities to copy the music and video information onto the hard disk of the computer?

Also there are freeware utilities that will record all the files and folders of a hard disk and if a preference file should ever be created by Windows XP on the hard disk or an existing file changed to record how many times the user has played the copy-protected CD and DVD disks, the user will find out and trash the preference file (or replace it with an original copy).

And what about the possibility of a user plugging a quality stereo system into his/her personal computer and "re-record" the music or video information? Then what? A person will be able to play the disk on a stereo system as often as he likes while the quality of the digital recording on a personal computer will make it extremely hard to tell the difference. It is no wonder some people are calling this "Digital-to-Analog-to-Digital" music recording approach the bane of all music companies.

And if people anonymously name their latest computers, operating systems and software so that no trace of their personal information ever gets recorded on any digital file created by any software program, then go upload the information on a free and anonymous web site from a public Internet cafe and allow people to visit the site and download what they like, it would be very hard to stop that kind of thing from happening in the real world.

Or the user could anonymously plug the machine temporarily into a public network with access to the Internet and with constantly changing IP addresses and let other people with peer-to-peer software download the anonymous music or video information. The ability of the music companies to identify the culprit would again be virtually impossible.

Furthermore, such copy-protection technology assumes people will be purchasing the latest computers and/or operating systems and will not be downloading the latest anonymous freeware or shareware utilities designed to bypass the copy-protection mechanisms.

The music companies should really have another think about this approach because some wiseguy out there will bypass the copy-protection mechanisms with remarkable ease.

UPDATE
10 February 2003

Some people have suggested taking a different tact to the music companies' anti-copy protection technology. Why not let people share the music legally online and so give the musicians more exposure of their work and thus give them a better chance of making more money for themselves.

As it currently stands, the music companies make a significant profit from the sale of the music artists' work. Apparently the music artists earn at best 5 per cent royalties and the rest goes into the pockets of the music companies. However, if music sharing can be legalised, music artists will be more significantly rewarded through alternative means such as live concerts, television, newspaper and magazine appearances, and so on. Apparently musicians can earn more money through this method than by selling CDs through the music companies.

As some commentators have noted, music companies are being a little less truthful on the matter of supporting musicians when fighting online music sharing. As Richard Stallman, president of the Free Software Foundation, said:

"The truth is that they [music companies] treat musicians no better than they treat [the people]. For listeners, for musicians, and for the health of music, governments should legalise music sharing so that we can give our favourite bands publicity in a healthier way. And they should make sure music sharing is feasible, too."

This is an interesting idea. Will it work? Probably not since it will be the music companies who will be up in arms when they see their own profits start to dip down unless they can do something else other than sell CDs. For example, the Australian Record Industry Association (ARIA) has noticed a 4.4 per cent reduction in CD sales, or in terms of annual sales revenue about $56 million or 8.9 per cent to $573 million (18) at the height of the MP3 file sharing on the Internet in 2000-2001. ARIA claims this is due mainly to "the widespread proliferation of unauthorised copying via CD-burning and downloading."

Unfortunately what is not known is whether on the other side of the equation the artists got paid more money by having the music shared to more people (e.g. by attending concerts etc)?

To show how important the profits are to the music companies, they are now claiming the latest anti-copy-protection technology is being accepted by consumers with CDs selling exceptionally well. And by increasing consumer awareness that music sharing is illegal, hopefully enough consumers will do the right thing and buy CDs from the music companies.

Well, how else are music companies going to feel wanted in today's society!

UPDATE
22 February 2003

Because of the difficulties in identifying individuals who may be copying illegal music, several record companies have decided to focus on larger and more identifiable entities such as universities.

Thus this week has seen the music companies take a number of Australian universities to the Federal Court seeking a ruling that would allow the music companies to search university computers for alleged MP3 music copied illegally from the Internet. NOTE: Downloading MP3 music is not illegal. For example, if your have the original commercial CD but is old and scratched, you can download an MP3 version of the same music. Also if you make your own music and give it freely, you can download the music without a problem. But having an unpaid copy of a copyright music file is considered illegal.

While this legal action is taking place, a number of students and academics are probably burning their MP3 music collection on the hard disks of university computers onto CD-R and storing them off site.

Well, who would be silly enough to leave copyrighted commercial MP3 music files on a non-personal "work-related" computer (the same is true of software)? Clearly the computer is not owned by the students or academics. If the students and academics are smart enough, they would burn the MP3 music on a CD-R or flash pen and carry this around with them all the time and this would always keep the "work" (or university) computer clean of potentially illegal copies of music or other digital works.

You see, the authorities don't need to supply a warrant to the students or academics to search a university computer (except for the usual warrant or other legal document to the university chancellor if the evidence is strong enough to support possible copyright infringements at specific universities).

So one would imagine by the time the music companies do get their order to inspect university property, the hard disks would probably be wiped clean of MP3 music. For the few hundred thousand dollars of running around in the legal courts seeking an order to inspect university computers and end up finding no one has broken the copyright infringement law sounds pretty silly. Maybe a significant proportion of the alleged A$54 million lost in revenue to the music companies due to music piracy is actually representing the costs by the companies to go to court to get warrants to inspect people's computers?

And as soon as the music companies finish with their inspection, students and academics would bring back their CD-Rs and start playing music as if no inspection had ever occurred.

As for those individuals who actually own a computer and bring it in on a daily basis to the university, the record companies must seek orders for specific individuals at the university to inspect their machines because these computers are not owned by the university. Much harder to prove!

And what about the allegedly widespread individual and non-commercial copying that is claimed to be going on outside university campuses? This legal action by the music companies will not solve the problem.

Again people can make a mockery out of the wasted money and time spent in the law courts by the music companies just trying to stamp out illegal copies of music. And for what?

It would appear the action is nothing more than an attempt to frighten a few more people into buying CDs from the record companies so as to give them a slightly bigger profit at the end of the financial year. But the truth to the matter is that so far no company in the world can 100 per cent stop the trade of illegal music copying by individuals for personal use over the Internet or elsewhere.

The music/record companies will have to consider alternative options to solving their dilemma in maintaining high levels of profit.

UPDATE
12 May 2003

Those companies with copyright ownership of certain music are at it again. In an attempt to legally control certain information being shared on the Internet by individuals, a number of recording industry groups decided to hold two providers of free file-swapping software liable in a court of law for the potential copyright infringing actions of some of their users.

Then last week a court ruling was made in favour of the two providers stating that they cannot be held liable for the actions of other people. Otherwise the implications would be that people like Microsoft could be held liable for supplying the Word package to individuals for criminal use (e.g. how to build bombs, write secret messages, assassinate rich and powerful people etc). And that would mean the end of the software industry as we know it!

A rather silly argument the record companies have taken. The only thing the record companies can do now is to gather evidence by some means to help them identify specific individuals involved in copyright infringements before legal action can be taken against the individuals. Clearly this is going to be a very expensive and time-consuming activity to monitor and act upon when there are well over a billion people in the world online at any one time!

And what about those who aren't online as well? Or if they are online, how they might choose to provide the music anonymously at free web sites from an anonymous and changing IP address or have them seriously encrypted for only the trusted few to enjoy? (19)

This is a major setback for the recording industry groups such as the Recording Industry Association of America (RIAA), the American Federation of Musicians, and the Christian Music Trade Association.

As a consequence of this latest court ruling, the record companies are now being forced to use psychological tactics in the hope of frightening the average person on the Internet into not sharing any kind of file with other people. As we speak, the record industry is using the instant messaging feature in a number of file-swapping software to send a message to users not to share any files of any kind in case they might contain copyright material. To the record industry, the solution is clear cut. Don't file share at all!

Should you or should you not swap files on the Internet?

If you own the copyright to a file (i.e. you have paid for it, or you have created the file and want to share it with others), then you are in your legal rights to share the file with other people unless the license agreement that comes with the file (if it exists) explicitly tells you not to.

The thing to remember when file sharing copyright material is that it is not illegal to make available the music you have already paid for or have created for yourself on the Internet. Even if the record companies could find a way to legally inspect your collection of music online, they can't legally force you not to make the copyright material available online if you are the owner of the material or have paid a license fee to use it in a way that is deemed reasonable. Therefore you are entitled to make your collection available online if you choose to do so.

Also the act of downloading (or simply listening to the music in) a file is not illegal unless you are fully aware that the file you are downloading (or listening) contains copyright material for which you have not paid for it at any time and have no intentions of paying for it in the future. And even then, you may have to wait until it has been fully downloaded (or have heard enough of the music) to get enough information on what you can or cannot do with the file, known as a license agreement.

Then you have to decide whether or not to keep it or erase the file after it has been downloaded. The very act of deciding whether or not to keep a copyright file is also not illegal. Also the act of downloading onto a CD-R a file before working out if it is a copyright file through the process of burning is also not illegally.

What is illegal, however, is knowingly being aware the file is protected by copyright and you decide to keep and later use a copyright file you have downloaded either for personal or commercial use (i.e. with an expectation of making a profit from it either directly or indirectly) and there is no intention of you making a payment to the original authors or copyright owners of the file. Such action is considered going against the concept of "fair use" in accordance with the copyright laws of most international countries.

But don't worry if you have already downloaded and burned the copyright material on CD from the Internet which the record companies may consider illegal if you didn't know before that it is protected by copyright. If you don't intend to keep and later use the material for commercial (or personal) use, then you should be safe. And even if you are using the material illegally, a lot more work needs to be done by the record companies to find the evidence (especially on a personal level).

But because it is very expensive, time consuming and difficult to prove this personal use level properly in the real world (commercial use level, however, can be easy with the right sting operation (20)) and because there is little financial gain to be had from taking individuals to court (because individuals don't have millions of dollars to pay the record companies), it is usually more worthwhile targeting businesses or organisations that do have the money.

That is why we don't see copyright inspectors entering uninvited into the homes of every individual on a weekly, monthly or yearly basis just to make sure people don't have unpaid copyright material. It is simply too hard. And to make it even harder, individuals can archive the music, store them away somewhere, and not play them for a while. In that situation, it becomes virtually impossible for record companies to check up on what you've got.

Our recommendation is that whatever unpaid (i.e. unlicensed) copyright material you do download off the Internet or elsewhere and decide to keep for whatever reason that it is entirely for your own personal use. Ideally, you should be able to prove it meets the concept of "fair dealing" under the copyright laws (i.e. as an evaluation copy, to help with your education needs or for research purposes, and/or to get you in a better financial position so you can afford to pay for the copyright material) and nothing else. However, if you keep the music and use it to make a profit either directly or indirectly and you have not considered paying for it before, you are better off buying the music now for that peace of mind.

The same is true of any other copyright material containing intellectual property such as software.

What constitutes 'fair dealing' under the copyright law?

Here is a quote from one Australian library to help you work out what might constitute 'fair dealing' in your part of the world. But always check with local laws first before taking the following verbatim as the fundamental rule:

"Certain dealings with copyright will not constitute an infringement, including:

    1. A reproduction that is a fair dealing under the Copyright Act 1968 (the Act), including a fair dealing for the purposes of research or study; or

    2. A reproduction that is authorised by the copyright owner.

It is a fair dealing to make a reproduction for the purposes of research or study, of one or more articles on the same subject in a periodical publication or, in the case of any other work, of a reasonable portion of a work.

In the case of a published work in hardcopy form that is not less than 10 pages and is not an artistic work, 10% of the number of pages, or one chapter, is a reasonable portion.

In the case of a published work in electronic form only, a reasonable portion is not more than, in the aggregate, 10% of the number of words in the work.

More extensive reproduction may constitute fair dealing. To determine whether it does, it is necessary to have regard to the criteria set out in subsection 40(2) of the Act."

This quote covers non-profit, or non-commercial use of copyright works.

For commercial (i.e. profit-making) purposes where it is important to use some copyright works, you can make a copy of up to 300 words or thereabouts of any copyright works, up to 30 seconds of music, and use freely accessable sample images (with copyright details included) without the permission of the copyright holder. For more extensive copying of copyright works, you should get permission before selling the information for commercial purposes.

UPDATE
25 June 2003

The record companies are now trying to shutdown web sites in the US and abroad which are purported to provide to Internet users with free downloads of modern copyrighted music (we must assume the music are not owned by the Internet users such as the original artists or the music has not been purchased legitimately by the web site owners). A reasonable attempt to curtail known fixed sites containing unpaid copyright music.

But like a bucket with numerous holes in the bottom, the record companies try to cover one or two holes and the rest of the holes gush out more water or a few new holes suddenly spring up out of nowhere. If record companies are to do this job properly, make sure all the holes are plugged up!?

For example, what will the record companies do with the free and legitimate peer-to-peer software which turns any computer into a file sharing site (no need for establishing a web site)? And the computers need not have to be fixed to any one location or for the user to be registered with a local ISP? Just plug your computer to any Internet-accessible network in your area with the right network settings and presto! You are totally anonymous!

Then there is the common problem of people freely sharing or swapping burned CD-Rs containing the dubious files with others either in person (if you know the people well enough) or through the mail (done anonymously of course). Or why not make a direct phone call to friends and make music downloads through your modem and computer (with Internet phone calls, the cost is the same as getting on the Internet)? It is unlikely records companies will go around tapping everyone's telephone in the world just to find out!

If you are going to do the job, you must as well do it properly.

UPDATE
July 2003

Bertelsmann has decided to join with AOL Time Warner, EMI Group and RealNetworks as part of a conglomerate to back the rival music-sharing service MusicNet. This means the Napster assets has been purchased by Roxio. Together with PressPlay, an online music distribution infrastructure plus the catalogue rights to all five major labels formed by Vivendi Universal and Sony Music Entertainment, Roxio intends to resurrect Napster from the dead and start a whole new era in selling music online to the mass market. The deal for Roxio was estimated to have cost in cash and stocks around US$39.5 million all up.

A good buy in anyone's language!

While in the US, a rath of proposed new legislation from US Congress representatives John Conyers Jr. and Howard L. Berman and co-sponsored by four other Democrats may come to fruition in the hope of stopping all unauthorised taping of movies displayed in cinemas (which is how illegal copies of DVD titles before they come out in the video shop are produced), to stop people from registering a Web site under a false name, and to stop anyone from uploading just one song, movie or other digital file on a public computer network such as KaZaA.

The proposals are considered reasonable assuming the people carrying out the activity are not doing it in the name of surviving or need to access certain information of an educational and research value.

But even if the legislation could be passed, it still won't stop people from sharing their CDs, MP3 files or other digital works with friends or delivering it anonymously to anyone over the Internet, phone or by traditional mail. The legislation will merely try to psychologically frighten the richer people who want to engage in this activity into doing the right thing.

What is morally the right thing to do is going to be dependent on the circumstances for each individual.

UPDATE
August 2003

The Australian Record Industry Association (ARIA) has looked at the latest sales of CD singles in Australia and have noticed what it believes to be a significant fall of 17 per cent in CD numbers sold on the market in the first half of the year. ARIA has interpreted this drop in sales as due entirely to the availability of what it claims to be a proliferation of illegal music files on the Internet.

As a result of the sales figures, ARIA announced its readiness to sue any Australian individual on the Internet for uploading unlicensed (i.e. you have not paid for the album or single CDs) copyright music files to fixed servers and file sharing networks (especially the well-known variety of peer-to-peer file sharing networks such as KaZaA with individual computers acting as mobile servers). This announcement comes at a time when their US counterpart known as the Record Industry Association of America (RIAA) is also preparing a similar move in its own country.

The biggest headache, however, will definitely be the file sharing networks brought on by readily-available free peer-to-peer file sharing software. According to an ARIA's spokesperson:

"File sharing networks in particular present a global problem for the music industry and a globally coordinated response is being undertaken by the industry. If the commencement of litigation locally is warranted, then ARIA will commence such proceedings as are strategically appropriate at that time.

'These [piracy] activities have a significant negative impact on the industry, particularly at a time when the industry is developing, or supporting the development of, legitimate online business models, most notably, Apple iTunes." (21)

But as this quote shows, the record companies still don't know precisely what to do with file sharing networks.

You see, the phrase "is warranted" is the most telling part of this quote with respect to the state of the record industry today following the advent of file sharing "peer-to-peer" software. Because what ARIA is trying to say is that if they are lucky to find evidence on the network of illegal music files (and this assumes the files are not from original and legitimately purchased music CDs where users choose to make the music on their CD drives or hard disks available to others), the really fun part begins when they have to work out exactly where the offending individuals are located. It'll be like searching for a needle in a haystack!

To put it in a nutshell, the record companies still haven't got a clue how to deal with the problem. So the best the companies can do using current technology is make a visit online to a well-known file sharing network such as KaZaA and randomly select individuals. They will then look at the files being made available for uploading by the individuals, download a few songs and check their copyright and, if they are not legitimate, use the file sharing software to determine the individual's IP address and later hope to hell the individuals will remain online long enough on the same IP address so they can be tracked down through a local visit.

If this tracking down of the individual through an IP address and/or any other personal information left behind by the individual in the software or on a database held by an ISP or elsewhere is too difficult, the record companies will have to move on to the next individual.

We wish the record companies a lot of luck. Because they are going to need it!

As for the idea of randomly looking at people's files on the assumption that they might be illegal and are only interested in checking for the copyright status of music files has to be seen as a serious breach of privacy laws. As a representative of Sharman Networks, developer of file sharing program KaZaA, said:

"We are deeply concerned about random attacks on people's privacy, potentially damaging attacks on their computers, and harassment of citizens. It is unfortunate that the RIAA has chosen to declare war on its customers by engaging in protracted and expensive litigation, when the problem of copyright peer-to-peer networks can be solved with existing software and business partnerships between the record labels and the providers of peer-to-peer software." (22)

UPDATE
5 September 2003

The Recording Industry Association of America (RIAA) consisting of Universal (a division of Vivendi Universal), Warner Music (part of AOL Time Warner), Sony Music (part of Sony Corporation), Bertelsmann AG and EMI Group Plc are realising the extreme difficulties in identifying the more anonymous individuals involved in illegal copying and uploading of music from CDs not purchased (and hence licensed) by the individuals. Now every anonymous individual involved in this activity are being asked to sign an amnesty form declaring they will no longer supply free copies of illegal music on file sharing networks.

This means for applicants to qualify for the amnesty program, you must type your full name, address, telephone number and email address, have it signed, and send it to RIAA (23). By doing this, it is claimed RIAA will agree not to "support or assist in any copyright infringement suits based on past conduct".

Why do they need to ask for these personal details if they already have individuals in sight for future prosecution? Maybe RIAA knows who the individuals are and are just being nice enough to give these individuals amnesty if they legally repent now and do the right thing.

But that doesn't make sense. If RIAA knows, they would have made the names of anonymous individuals and their locations known online (24). In that way, individuals can see the folly of their ways. But nothing so far. Even the form itself has not been finalised for public release. NOTE: Perhaps RIAA are setting up a special web site designed to track down all the web users who download the form (assuming it is not from an anonymous location).

It looks like another classic psychological tactic to frighten individuals into complying with US copyright laws even if the music industry are still "up the creek" so to speak in working out how to track down all the individuals involved in supplying illegal free music to the online masses.

NOTE: You should remember you are entitled to the right to limited sharing. For example, if you own an old original CD or vinyl and the music has deteriorated in quality due to scratches and other normal wear-and-tear, you can download the music online from other sources. Similarly, if you have purchased the original album, there is nothing illegal about playing the CD or keeping one (1) copy of the music from the CD on your computer's hard disk and playing the copy and archiving the original CD. And there is also nothing illegal about turning on your file sharing software and directing the software to the location of your music files. The onus is really on the individual uploading and downloading the music to do it legitimately.

UPDATE
10 September 2003

RIAA are applying psychological tactics to frighten individuals to keep their legitimate (or illegitimate as the case may be for some individuals) music to themselves after settling the first of the 261 lawsuits it filed on Monday 8 September 2003 against individuals for uploading what was claimed by RIAA to be over 1,000 illegitimate music files.

Only 1,000 music files from 261 individuals? Does that mean the remaining few hundred million music files being shared freely online by over 10 million individuals worldwide are okay? Or is it because RIAA are having trouble determining the exact location of the remaining more anonymous individuals supplying the rest of the music files for free?

Anyway, the first lawsuit was an easy one in anyone's language. RIAA chose to focus part of its multi-million dollar efforts to stamp out music piracy on a 12-year-old girl named Brianna Lahara, a user of the KaZaa file-sharing service. She was used as an example to help show to the media the emotional distress of the child getting into trouble with the law and so hopefully frighten other young music enthusiasts into not sharing their music freely online.

Lahara was an easy target because she was someone who remained online for long periods of time (allowing the association to get a fix on location using the IP address and make links to the personal details left behind on the database of KaZaa) and she had no knowledge of the problems sharing music can cause for certain profit-motivated music companies.

A great deal of media coverage was made to sue a 12-year-old girl for alleged breaches of copyright infringement. What is not known, however, is whether the girl had a legitimate copy of the music from original CDs and had decided to make some of the music available online, or whether the girl downloaded music for which she had no original CDs to prove the legitimacy of the download. But it would seem the mother of the girl thought fighting the RIAA in the courts would be too costly and has decided to pay the fine to RIAA.

At the same time, RIAA has realised it would be too difficult to ask for huge amounts of money from the individual in question because 12-year-olds or their parents are not likely to have millions of dollars to pay RIAA. Also pursuing such a case would taint their reputation as someone going after the small and helpless individuals which could seriously affect CD sales nationally across the US (well, it certainly won't encourage people to buy more CDs). Furthermore, the US law cannot provide substantial prison sentences and hefty fines to individuals who are under the age of "not fully understanding what they did wrong".

So in the end, RIAA agreed to let the mother of the girl pay US$2000 to the association in an out-of-court settlement according to RIAA spokeswoman Amy Weiss. Weiss declined to discuss how the settlement was calculated:

"We don't want to talk about the process of settlements. We want people to know that trading music online is illegal and there are consequences [if discovered]."

As for the remaining 260 lawsuits, we hope the individuals have changed their names and addresses in time to avoid receiving the "see you in court" documents. Otherwise next time these individuals should be a little more cleverer not to leave so much evidence by way of personal details with KaZaA (or Grokster Ltd and StreamCast Networks Inc.) about who they are and where they are located!

Now what can RIAA do about the more anonymous users sharing music files on the Internet?

The fun has only just begun!

UPDATE
12 September 2003

It now looks like RIAA are in hot water with the law this time after releasing their affidavit form for allegedly providing amnesty to individuals involved in copyright infringements on MusicUnited.

Ira Rothken, the Marin County attorney in California has filed a consumer lawsuit against the organisation claiming the alleged amnesty program (also known as Clean Slate program by RIAA) is fraudulent.

The contentious issue being contested by Rothken is exactly how legally protected individuals are in not being sued by RIAA. According to Rothken, the legal clauses in the RIAA amnesty program mention nothing about a "release of claims" and no legal evidence supporting RIAA's indirect agreement that qualified applicants will not be sued.

In the words of Rothken:

"[RIAA claims the amnesty program] would provide people with a clean slate, but after a further reading of the legal documents, it became apparent that this Clean Slate program didn't provide any such thing.

'The legal document provides no release of claims, no promise not to sue you. It offers no promise to actually clean the slate by destroying the data that these people provide. All it says is that the RIAA simply will not cooperate in any lawsuit brought against you.

'That on its face is a deceptive business practice." (25)

Furthermore, RIAA cannot make the amnesty offer on music it does not own the copyrights. RIAA is acting as if it represents all music labels in the world when it doesn't. So it cannot have the power to promise not to sue individuals for alleged copyright infringements.

And how would the information in the amnesty form be used by RIAA? As it stands, there is nothing in the agreement to stop RIAA from, say, quietly distributing the personal details of repentant individuals in the form to other music companies. And the agreement also mentions nothing that would stop those other music companies from suing the individuals.

Hence any formerly anonymous individuals who were silly enough to fill in the personal details in the amnesty program could still be held liable for legal prosecution. As Rothken says:

"Any of the RIAA's members could file suit against these individuals who have participated in the Clean Slate program, and subpoena the information they need from the RIAA about this person's guilt. So, in the end, the person who supplies all this information to the Clean Slate program will have a dirtier slate than they would have if they never participated." (26)

RIAA is naturally supporting the view that the affadavit form is not fraudulent. Jonathan Lamy, an RIAA spokesperson, said:

"Read the form, it's pretty clear what's being offered and who's offering it.

Apparently no good deed goes unpunished. It's also unfortunate and ironic that some lawyer would try to prevent others from getting the assurance that they want, that they won't be sued." (27)

UPDATE
27 September 2003

The techniques used by RIAA to track down the few anonymous individuals blatantly violating copyright laws through free peer-to-peer music file exchange are becoming clearer. RIAA has to employ illegal tactics of its own for the association to issue lawsuits against individuals!

For example, RIAA has to use an unauthorised hacked version of the KaZaA file-sharing software in an attempt to secretly collect personal information about users (i.e. determine the IP address of computers allegedly involved in copyright infringement). This in itself violates copyright laws and the user-end license agreement for the software.

Another technique RIAA employs involves hacking techniques to get into the computers of users using the IP address and snoop around for personal files in order to send the lawsuit to the residential or business address of users. Again this violates another piece of legislation for protecting personal privacy.

Once RIAA has the personal information they want (hopefully it is the right owner of the computer), the users are sent screenshots of their computers as evidence followed by a lawsuit.

However, if this is not possible (because consumers are smart enough to protect their privacy through various simple security measures such as a firewall and downloading from anonymous locations), RIAA will use psychological tactics such as sending threatening messages through the user's KaZaA Media Desktop software.

Sharman Networks Ltd., based in Cremorne in Sydney, Australia, and owners of the KaZaA web site and software are not impressed. While RIAA is trying to shutdown file sharing services such as KaZaA by targeting individuals, Sharman Networks Ltd has decided to turn the tables on RIAA with a counter-claim lawsuit on 22 September 2003 after discovering the illegal tactics RIAA had to employ to gather personal information on individuals.

Also Sharman Networks Ltd claims RIAA is conspiring to force its file sharing service out-of-business by not letting KaZaA license content for distribution on the file sharing network thereby curtailing their right to make a profit on the distribution of legitimate files.

Furthermore, Sharman Networks Ltd will argue there are a lot more people who are legitimately using the file sharing services such as Bollywood movie houses and numerous small music labels. For the few individuals who are probably doing the wrong thing according to RIAA, many other individuals will be denied access to legitimate files and there will be a financial loss for Sharman Networks Ltd as a result.

Could we see RIAA being forced by US law courts to pay hundreds of millions of dollars in lost revenue to businesses such as Sharman Networks Ltd for being forced out-of-business? Or will RIAA force Sharman Networks Ltd to pay hundreds of millions of dollars for the wrong-doing of a few individuals?

The battle continues...

UPDATE
21 October 2003

A slump in music sales worldwide (28) has seen some record companies changing their tact. Instead of making a big deal of suing individuals as if this would improve customer relations and their bottom-line, record companies are learning to be creative in selling merchandise and music. Smart move!

For example, the world's largest music company Universal Music Group has announced today the launch of a new cyber-retail store on the San Jose-based eBay.com internet auction site. What makes this online store a little different from selling the usual CDs is the range of other products. Universal has decided to sell artist memorabilia such as handwritten lyrics and the signature of the original artists on guitars etc. And Universal has decided to make available older, hard-to-find music for sale through their classic catalogue records and vinyls.

The move is a good one. Firstly, eBay.com has over 75 million registered users. Secondly, Universal is expanding its product line to include things that cannot be easily downloaded but are likely to sell due to their significance to music fans of their favourite artists. Thirdly, it doesn't cost much to tap onto this market on eBay.com. And fourthly, no other music label has experimented with this approach.

As Universal Music Enterprises President Bruce Resnikoff said:

"This new relationship enables us to provide passionate music fans with a one-stop shopping experience where they can purchase the music and memorabilia of some of their favourite artists." (29)

With the realisation of a handsome profit for eBay.com, vice-president and general manager of eBay Entertainment Mr Mike Aufricht said:

"Universal Music Group boasts many of the best artists in the music business. We are thrilled to team up with Universal, bringing their music to fans on eBay." (30)

Michael Goodman, an industry analyst with Yankee Group in New York, has put a slightly more balanced slant on the deal:

"It's experimentation. There certainly is a fair amount of music sold on eBay to begin with so it's an untapped market for a record label. From both sides of the equation, it's fairly inexpensive to try and tap into this market.

Anything that is consumer-friendly is certainly in their favour, considering not many of their actions have been consumer-friendly." (31)

UPDATE
7 November 2003

RIAA is still battling what it perceives to be a major music piracy problem based on an analysis of CD sales. However, it seems be be doing it in a much more friendlier manner with positive information coming out in the media about ordinary people doing what looks like the right thing.

To start the ball rolling, the New-York based research company known as NPD Group Inc. has claimed this week that of the 1.4 million US households it legally tracked for research purposes, practically all had deleted their music files in August 2003. This is said to be in stark contrast to the 606,000 households doing the same thing in May 2003. The reason for the sudden paranoia shown by ordinary American citizens is presumably because of RIAA's recent efforts to sue individuals for sharing copyright music from dubious "unpaid" sources.

Unfortunately, what the research firm has not mentioned is that once a third-party observer like NPD Group gets involved in tracking (32) the actions of a typical computer user online (or through a survey or personal interview of some sort), the results are going to be heavily skewed in a manner that will favour what companies want to hear. Well, let us put it this way: How many readers are going to say they are keeping and perhaps even increasing their music collection on PCs while at the same time allowing themselves to be "tracked"?

No one in their right mind would say or show to someone else they have increased the amount of music on their PCs. Rule number 1: don't be a target! And if you didn't want to be a target for investigation by RIAA, you would try really hard to say you had actually reduced the number of music files on your computer.

Seriously, the NPD Group Inc. has provided other more useful research information, such as how average Americans have perceived the US record companies. Assuming the sample size was large and representative of a wide range of people (which is again dependent on how the research firm managed to "track" US households and the methodology used to gather the statistical information), it would appear around two-thirds of consumers had a negative opinion of record companies thanks to RIAA's litigation efforts.

To avoid this negative opinion, the research firm has suggested the record companies should engage in positive education with the public about the effects of music piracy rather than focussing on the aims of publicising lawsuits on individuals, especially if the individuals are 12-year-olds!

Hackers fighting back?

Twenty-year-old computer programmer and Norwegian hacker named Jon Lech Johansen is making ripples in the cyber world with his successful win in the Norwegian law courts to decrypt DVDs for private use using a program he developed for Linux called DeCSS when he was 15 years old.

Dubbed DVD Jon for his ability to circumvent the DVD Content Scrambling System (DVD CSS) for protecting movies through his program, Mr Johansen successfully argued that as a consumer who purchased legal copies of DVDs he was entitled to decrypt the DVDs and watch them on the operating system Linux. Why? Because the less common operating system was not provided with the software key from the owners of DVD CSS at The DVD Control Association (DVDCA) to unlock DVDs and allow Linux users to watch their movies.

Johansen argued he could not be held responsible for other people downloading his program and using it to make pirated copies of DVDs.

As Mr Johansen's lawyer, Mr Halvor Manshaus, said:

"My client is convinced that he is right. He feels that he is defending his rights as a consumer." (33)

So how did he end up going to court in the first place? Apparently Mr Johansen made available his program online, putting the Motion Picture Association of America (MPAA) into a frenzy when they discovered how the program could not only allow Linux users to watch DVDs but also copy DVDs using other software, and how the DVDCA has lost money for not making their software key available to Linux to help users watch DVDs and hence make a profit from licensing it to the makers of the operating system.

Consequently MPAA and DVDCA have decided to file a complaint against the individual at Norway's Economic Crime Unit.

Yet despite this effort, the Hollywood movie industry and the Norwegian prosecutors failed to show evidence in an Oslo district court that Mr Johansen was illegally copying DVDs. By illegal, we mean evidence of duplicate copies on his computer and DVD-R/RW disks, and in his software being able to copy DVDs for the purposes of distributing and/or making a profit from the sale of the DVDs to other consumers. And there was nothing illegal about making his software available freely to everyone else online if he wanted to.

And now Mr Johansen is being prosecuted again for providing users with a Macintosh version of his original QuickTime for Windows AAC Memory Dumper designed to dump the output of a QuickTime stream to a file. The utility is called QT Fair Use and it enables users to dump a perfect, unprotected, digital copy of the protected audio while downloading it from Apple's own online iTunes music store thereby circumventing the Digital Rights Management (DRM) technology. NOTE: On 20 February 2008, Apple issued a letter to the QTFairUse project warning them to "cease and desist" or face legal action. The project has since removed the file from the main download site.

Norwegian prosecutors will try again later in an appeal on 2 December 2003 to prove Mr Johansen had broken the copyright law with his DVD-copying program and his memory dumping utilities.

Even the Hollywood movie industry could prove anything about the young man, what about suing all the professional people who actually make an exact copy of the DVD bit-by-bit and re-burn the movie onto another DVD and later sell them for a profit? There is no need to use Johansen's DeCSS to achieve this goal! And anyway, some software utilities can take a regular snapshot of the computer screen while the movie is running to create a reasonable quality duplicate of the original movie.

One would have to say, some people are really getting upset over nothing when the real problem lies with those professional criminals who do pirate movies by alternative means and sell them at a profit. Even if the real pirates do use Johansen's software utility for the wrong purposes, these are the people money should be spent to track down and prosecute and not those who create the utility because they are forced to find a way to watch and listen to their own legitimately purchased DVDs or CDs.

The entire movie (and music) industry should really get their act together and concentrate on catching the big guys involved in serious piracy rather than the little guys who are doing it for their own private use because of deficiencies in the technology they are using.

UPDATE
September 2004

Another blow against the Hollywood movie studios and the music industry with a US appeals court upholding a 2003 ruling that the makers of peer-to-peer (P2P) file sharing software are not legally liable for prosecution for the copyright infringments of their users. In 2003, the court ruled that Grokster and Streamcast Networks are free to distribute their P2P software. The onus is on the copyright holders and law enforcement agencies to track down the individuals responsible for using the software to make available online any kind of pirated information such as software, music and DVD products.

The Hollywood movie producers tried to fight back through an appeal, but without success this time.

Before this appeal came through, another high-profile battle in February 2004 saw the Hollywood movie studios successfully stopping the US firm known as 321 Studios (but not other firms outside the US) from selling a piece of specialised software called DVD X Copy designed specifically to copy DVDs using a computer and a DVD burner. While attempts to argue that such software would help customers to make a backup copy of their much beloved DVDs purchased legitimately before they suffer the inevitable wear-and-tear situation due to scratches, dust or other forms of damage, the Hollywood movie studios were not quite so forgiving. Their argument was that the software was being used to pirate DVDs by some customers and therefore its availability had to be curtailed at all costs.

As a further argument, the Hollywood movie studios said that no product is expected to last forever. And as such you are not entitled to a replacement copy due to wear-and-tear or whatever. If it gets scratched or damaged in some way, you are up for the cost of a new DVD.

This argument is supported by the executive director of the Australian Federation Against Copyright Theft (AFACT), Adrianne Pecotic. She said:

"Consumers are not entitled to replacement goods if they break their crystal glasses or stain their new clothes. Once a right exists to create an unprotected copy of a DVD film, that film is then exposed to unrestricted copying, whether a single copy for personal use or 10,000 copies for sale around the world." (34)

But what happens if you can't purchase a replacement copy from anywhere? How do you preserve the digital-content on your own legitimately-purchased DVD for future use if the movie studios are not prepared to continue selling older DVDs with the same title because of the costs? Unless the studios are prepared to make the DVDs of any movie — old or new — for all eternity for anyone who asks for it, then any restriction on the availability of a replacement copy will force consumers to find ways to make a backup copy.

As Joseph Chatzimichail of Greece and owner of the popular Afonic DVD Guides website said:

"Personally I believe that a user should be able to back-up a DVD he owns." (35)

And that is how it eventually come through in the latest appeal. The onus was on the Hollywood movie studios (and by implications every other digital-content maker) to legally prove specific individuals were, in fact, knowingly using certain specialised tools to make illegal copies of their works for the explicit aim of making the copies available to others (either by selling them or making them freely accessible in some way).

As a consequence of this decision, law enforcement agencies are being employed by the music and movie industries to entrap individuals involved in illegal activity. The technique basically involves undercover FBI agents posing as ordinary Internet users downloading information on various P2P software until they find something illegal. When the material is found, the IP address and material is recorded and, with a bit of luck, the pirates' home location is determined.

For those users employing the Direct Connect file sharing software, the law enforcement agencies have had some success in tracking down pirates, which has seen RIAA announce 744 new law suits against the suspected pirates (by the end of 2004, RIAA would claim around 7,000 people were sued).

In other well-orchestrated sting operations, you don't actually need to have P2P or any copying software in your possession to get into trouble. If you happen to own an anonymous web site and email address on Yahoo.com or other service provider, you may receive emails for very low cost software, music and DVDs. Most emails are from the pirates, or fraudsters claiming to have the orginal products when they don't. Some might be genuine business operators selling OEM software (although very unlikely if it is the latest products being sold on the Internet). But some emails are produced by the undercover agents themselves to help them determine whether you download illegal information.

Some of this illegal information has been expanded to include child pornography, bomb-making and so on.

UPDATE
September 2004

Law enforcement agencies are making a big presence online in an attempt to track down individuals knowingly receiving illegal software on eBay and through spam emails. For example on eBay, a second-hand computer may be sold with a number of the latest software titles including Adobe Photoshop 7 to individuals in the same country (the owner will make this a requirement for legal reasons). You may buy the computer thinking the software comes with the original installation disks. Later you discover this is not the case when you see the software promised are burned on CD-Rs. Then you receive an email asking whether you want to receive the rest of the software (i.e. potentially more illegal software). If you agree, you could become a target for the law enforcement agencies as they determine your location, what you do and how you use the software (e.g. through the serial numbers provided by the law enforcement agency and the files you create for commercial purposes).

Also be careful not to use the computer and OS as installed by the original owner. He/she will try to put your name in the OS after it has been freshly installed on the hard disk. In that way, the law enforcement agencies have a better way to legally link your name with the serial numbers of the illegal software for any files you create with it and sell in the marketplace. A good way to prove you are using illegal software.

If you do receive such illegal software copies on CD-R through eBay or other means, you have a choice (depending on the way the copyright laws are written in your country and perhaps how well you can hide the software from the eyes of others): either you may (i) destroy the copies (the preferred solution by software manufacturers wanting to maximise their profit); or (ii) keep in archive for educational purposes and to test for forward/backward compatibility of any software solutions you make (for commercial users). Or it could be used purely for private purposes (i.e. the files won't be shared with other users) and you don't go online when using the software, in which case the illegal software is virtually undetectable to law enforcement agencies.

Later, when you purchase your own relatively recent copy of the software (best to purchase second-hand from a legitimate source such as eBay.com or the local newspapers), all your previous copies of the software on CD-R kept in archive will suddenly become legal to use because they will be older versions of the software you have purchased.

That's probably the simplest way of solving the dilemma of what to do with illegal software copies in your possession. But remember, if you obtain illegal copies of the latest software and use it, you could be targeted.

UPDATE
October 2004

A new breed of downloadable freeware utilities designed to index and record what you have on your entire hard disk are being used by law enforcement agencies and copyright holders to determine while you are online whether the digital-content you have stored on your hard disk is owned by you or a copy from someone else and to use your IP address to track you down if it isn't a legitimate copy.

Although there are ways to manage this situation (e.g. don't download the utilities is a good start), you should be aware that this kind of prying on your digital affairs will compromise your privacy and security. So avoid such utilities like the plague. And if it is integrated into your OS such as Sherlock on the MacOS, make sure indexing is turned off. You don't need your privacy to be compromised.

In the end, you must decide the information you want to keep on your hard disk and the reasons for having it depending on your circumstances and what you wish to achieve for society with that information (hopefully it will be positive and beneficial for everyone).

And if you do keep illegal information, be prepared to face the consequences if anyone finds out (which usually isn't all that difficult in the digital world if you know the tricks of the trade and fully understand how other people try to find the evidence indirectly).

Remember, all it takes is for you to take a holiday and leave your computer at home and law enforcement agencies could enter your premises illegally to find the evidence. Its worse if you are renting a property.

UPDATE
November 2004

The next stage in controlling information by the authorities involve letting you know by email of a new credit card processing company in your country. Nothing unusual about this you might think. But if you look more closely at the email, you will notice an extraordinary level of acceptance for all kinds of forbidden or illegal stuff you can sell online. Hence you could potentially sell illegal copies of commercial software, child pornography and the works and yet somehow the credit card processing company will never ask questions of your activities. Very unlikely! In the light of recent reports of raids on people's homes by police for evidence they have collected online, this is the sort of thing a law enforcement agency would probably do next to trap people from presenting/selling information which is considered illegal to the authorities.

NOTE: We do not condone child pornography or selling illegal copies of commercial software online. The point we are making is that if you want to protect your privacy, you should be aware of the methods employed by the authorities that could compromise your privacy. What you do with your own digital information is your own individual responsibility. If the information you have is illegal (or truthfully damaging) in the eyes of the authorities, you must decide the reason for holding that information and what you hope to achieve with it. The rest of society can only ask of you that the information you keep will be positive for all and have benefit to society in some direct or indirect manner. If the people involved in creating that information or who may receive the information are going to be seriously or negatively-affected in some way, you should look at alternative information sources.

How do law enforcement agencies track you down?

Primarily by IP address, especially if you own one. An IP address is almost always linked to your home address with the help of your local ISP supplying the IP address who must comply with certain legislation.

ISPs usually keep personal information about you such as your name, address, telephone number and credit card details. This is the most effective way of identifying the person using a particular IP address.

Otherwise, the most powerful way of tracking individuals involved in illegal activities is through the credit cards they use to make the purchases (especially if IP addresses are not enough to track down some of the more anonymous individuals).

UPDATE
January 2005

Another technique is for an individual to act as a distributor whose job is to ask for a product sample from you. Now this is not unusual. However the sample you provide is often used by law enforcement agencies posing as a distributor to determine your details and figure out if the software you used to create the product or the product itself you are selling is legal. Basically, if you are going to distribute anything illegally, don't do it, especially with someone you don't know. Better still, find alternative products you can sell which is legal and safe in the eyes of the authorities.

But why do people have to pirate digital-content?

It is the old adage of "I have to live to survive and therefore I must make money" and the all too common "That's too expensive for what it is suppose to do or present to me".

Generally these questions can be best summed up as "the haves, and the have nots", or "the rich, and the poor".

Rarely it is the rich that do the wrong thing by pirating digital-content. It is usually those people who, at one time or another, had little or not enough in their lives to help them get into a position where they can survive easily and afford the cost of various things. Later, if the people do become rich without getting caught by the law, they may or may not continue with the illegal practice depending on whether this is the only thing they have trained themselves to be good at and are not bored in any way doing other things.

As one anonymous person said after pirating his own collection of movies:

"No matter what's happening with piracy and everything else, artists are still getting paid a fortune. The price on a standard CD or DVD is just so over-inflated. Before piracy was a problem with DVDs, you had to pay $35 or $40 for a movie and now you can buy them for $10, which just shows how much of a margin there really is." (36)

Clearly his concern is the cost of the products as soon as they come out onto the market. The high price is what's tempting people to make pirated copies of the digital-content for themselves (and sometimes with other people who they trust the most).

So in short, it really comes down to the price that digital-content makers are prepared to sell their work which determines the likelihood people will pirate the content.

For example, software manufacturers argue their latest software has to be sold at ridiculously high prices (e.g. AUD$1,000 plus) because they must survive and the people pirating the software are the ones responsible for making the software expensive to buy.

But there's the catch-22 situation. Make the software too expensive, and more people will be tempted to make illegal copies of the software from somewhere.

Surely the high price for software can't be due entirely to the pirates. What about the people who legitimately purchase second-hand original copies from others who have moved on to a newer version? For example, a little over 12 months ago, Adobe Systems, Inc. were selling their highly popular Adobe Photoshop 6.0 to the market for at least AUD$1,200). Now, in October 2004, you can purchase the software second-hand for less than AUD$150.

If software manufacturers want to argue the issue of pirates raising the cost of commercial software, what about the people who buy the software second-hand? Aren't these people too responsible for raising the cost of software to the levels we see today?

Or are the software manufacturers failing to admit that they are becoming increasingly greedy? For example, are software manufacturers not realistically looking at what the market can bear and/or putting the prices up too high in a marketing approach to make customers think the product is of high quality?

Or perhaps the cost to maintain a large software manufacturing company with lots of employees is getting too expensive?

We think it is a marketing gimmick to get only the professionals (and corporate users) to purchase them thinking they are unique high-quality programs worth spending the high price the software manufacturers are asking?

And then the software manufacturers wonder why the average consumers aren't buying the software, thinking many of them have illegal copies.

There's one way to find out: Make the software so ridiculously cheap that no one could possibly see the value of pirating them! Or alternatively, get software manufacturers to sell the older versions of all their software products at ridiculously low prices to the consumer market and then we will see how many people want to pirate the latest software versions. We think very few, if any, would.

You see, the problem with software manufacturers is how hard they make it for people to purchase older versions of the software. In most circumstances, software manufacturers will claim you cannot buy from them an older version of the software because this is how they will get you to purchase only the latest, high-priced software version. But this makes no sense unless if it a profit-motivated thing. If software manufacturers are serious about their claim that illegal copies of their software are forcing the prices for their latest products to go up, then why not give everyone an opportunity to purchase the older products cheaply? If would put a serious dent if not stop the pirates from making illegal copies of the latest software if people are happy purchasing and using an older version.

Then the manufacturers can still make a substantial profit by reducing the prices of their latest software once the pirates have trouble selling their illegal copies to other people. As for the people using the older software, if they like what they use, you can be sure they would be happy to purchase the latest version.

Yet somehow this would not be to the liking of many digital-content providers. Somehow they wish to keep making money at the maximum price possible for all eternity. They will only sell the products more cheaply if they are clearly overstocked and not enough people are interested in buying the products. Hence the reason why DVDs will suddenly come down in price after a while to say $10 or less.

So are some people being greedy? Or are we supporting too many people which is putting a massive burden on the costs to a business to recover through the selling of high-priced products?

Okay. What if a program like Adobe Photoshop was built by no more than four or five people running their own business? What would be the true cost and final price to sell the product on the market? Take away the cost of the box and printed manual and even make the software downloadable on the Internet, and what would be the final price to the consumer?

Would consumers still have to pay AUD$1,200 for Adobe Photoshop, or something much less?

This is something we have to look into more carefully if the problem of some individuals pirating digital-content is to be permanently stamped out. It is either that, or every individual must be guaranteed a well-paid job and one that makes it affordable to purchase the digital-content from manufacturers.

Is society able to progress this far to ensure everyone does the right thing? Or should we increase our security measures?

Are the pirates responsible for a slump in DVD sales?

The latest information as of February 2005 suggests the reason why companies are not selling enough DVDs is not because of pirates, but rather people are noticing a new DVD format coming over the horizon known as High Definition DVD (or HD-DVD) and are realising collecting DVDs now will not future-proof what they keep. At the same time not everyone sees the benefit of purchasing any kind of DVD if they only use it once or twice and that's it (which is usually the case for movies unless your a real movie buff and love only a handful of movies, or the movies come installed with awesome software and interaction capabilities).

To add to this situation, more and more consumers are starting to see the interest in looking at 10,000 or more offbeat hits courtesy of new Internet rental businesses rather than the staple 2,000 blockbuster Hollywood hits over the past 25 years which often end up as DVDs.

The market is maturing and people are getting smarter. People are realising things are changing too quickly, thereby making the purchase of DVDs today look obsolete in the next 12 months.

Evidence for this trend can be found in DVD sales of movies. Before movies are sold on DVDs, going to the cinemas was a popular pasttime for many consumers as can be seen at the Australian box offices. For example, Shrek 2 (an animation movie) pulled in AUD$50.3 million from cinema-going consumers, the highest amount of any movie for 2004. But when the movie ended up in retail shops as DVD products, the expected big sales was found to be lacking.

The same is true in general for other DVD products. Even the software market, although still growing strongly, is not as strong in the DVD market compared to software you can download off the Internet and use regularly.

Around half the movie studios' revenues use to come from home entertainment of which DVDs played a significant part. Now the studios are looking for other revenue-raising options. As David Hunt, president of the Australian Visual Software Distributors Association and who also heads up Paramount Pictures' Australian operations, said:

"Consumers are looking at the wall of DVDs they have bought during the past four to five years and realising there are only half a dozen or so they have watched more than twice.

They bought them because DVD was a sexy new format that everyone wanted to get into. Now we are getting to the point where this is a mature market." (37)

The solution for the movie studios will come when movies and games come together in the next generation of games consoles so consumers can get a total entertainment experience with full interactivity.

UPDATE
March 2005

What was once a popular pasttime as of 2004 is suddenly changing in 2005. The popularity of going to the cinemas on Friday nights and the weekends is facing its demise with the latest statistics suggesting people are discovering how effective the cinema experience is by going to their friends' homes to watch the latest release DVD movies on big home-theatre systems (perhaps sharing in the costs of hiring a DVD instead of owning a copy each). With cinema technology available to the home user, the high price of cinema tickets is forcing people to watch from selected homes having the right technology.

The only exception to this trend are the cheap cinema tickets during the working week where it tends to draw a large crowd at the cinemas.

Apart from that, owning a brand new DVD movie by one individual or going to the cinemas at night or on the weekends is becoming ridiculously too expensive for the average consumer especially when there is a mortgage to pay, looking after a family, and/or purchasing other more important items.

We shouldn't be surprised if sales of DVD movies are going down, and not because the pirates are stealing the profits.

Authorities targeting people selling illegal copies of digital products

It is official. Authorities may never be able to stop ordinary people on the streets making illegal copies of DVD movies, software and music for their own personal use. It is too difficult and legally impossible to control (unless they go about blurting to the world what they are doing, in which case they could get into trouble). Instead the authorities will target the big crooks involved in making a profit from selling illegal copies of the digital products to anyone.

Well done!

Although ordinary people knowingly purchasing illegal copies of products could get prosecuted (the onus will be on the authorities to prove people had knowingly purchased illegal products, which is getting more and more difficult given the quality of the illegal products, how they are being sold, and where they are coming from), the effort will be directed primarily to the sellers of the illegal digital products: Are they doing the right thing?

And now Peter Drennan, national manager for economic operations at the Australian Federal Police, is claiming the problem lies with organised crime networks supplying the illegal digital content:

"Piracy of intellectual property has links into organised crime. We're interested in the higher echelons of organised crime." (Manktelow, Nicole. Sink the prirates (Icon Supplement): The Sydney Morning Herald. 23-24 April 2005, p.3.)

Well done again. Now we are getting closer to the root cause of the problem. Combine this with the problem of poverty and the high cost of products and maybe we can solve the piracy problem permanently.

As for the average citizen trying to work out what illegal digital products look like, be careful of web sites that sell them. It is extremely difficult to see they are genuine products unless you can download them.

In real life, it may be possible to see photocopying/printing flaws in the covers of DVDs and CDs indicating possible illegal products being sold at your local street market. The use of CD-R and DVD-R disks instead of the genuine silver disks inside the covers is usually a dead give-away (although we at SUNRISE sell our own products on CD-R to help reduce costs due to the rapidly changing nature of our software rather than waste money keeping soon-to-be out-of-date software versions on silver CD-ROM disks). Any other shoddy examples of poor workmanship may reveal an illegal product. We emphasise the word may.

For super-rich companies such as Microsoft selling software products, you may not receive a certificate and a holographic image confirming a genuine product from another vendor.

On the internet, people may sell illegal software products claiming the items are OEM software which would explain the low cost (no manuals and boxes because it is usually supplied as a CD/DVD disk with another package such as bundled with an obsolete computer system). However, you should be dubious of the fact that the products being sold as OEM tend to be the very latest software products. For genuine software, rarely this is the case. If the products are old, it might be genuine. But always be suspicious of OEM software if it is the latest version and costing a fraction of the full retail price.

UPDATE
December 2006

We may have to back track a little about OEM software. The latest information at hand suggests OEM software can be genuine but are not usually advertised by the software manufacturers. The question is where can you buy genuine OEM software?

We mention this because we have found high quality web sites selling OEM software. When we posed the question (giving the web address of one such site as an example) to Adobe Systems, Inc. on 22 November 2006, we were told the following from Tina at Adobe Asia-Pacific Support on 18 December 2006:

"Thank you for contacting Adobe Asia Pacific Support.

With regard to your concern, we suggest customers to purchase from our authorized distributors and resellers. Although OEM product maybe cheaper, however, OEM users won't enjoy the same priviledges [sic] like those who purchased from authorized channels. Examples of priviledges are availing of replacement serial number and replacement CD installer due to lost.

For purchase inquiries, we suggest you to contact your local authorized distributors/resellers:

http://cgi.pacific.adobe.com/cgi/search_reseller.cgi?countrycode=au

Feel free to email us back for more concerns." (Email available from SUNRISE)

Assuming this quote is correct, clearly Adobe is not saying OEM software is pirated software or software that is deficit in some way. Rather, Adobe is saying you can purchase OEM software but you will not benefit from certain privileges as those customers who purchase the full boxed version from a retailer at the full price.

So what are customers really getting for their money when purchasing a retail version of say Adobe Photoshop valued at A$1,500 if it is possible to purchase an OEM version for say US$69.95? Can customers do away with the privileges for the sake of using the software itself?

Makes you wonder how much cheaper it would be if Adobe decided to sell its software over the internet without the box, hardcopy manual etc.

***

Leaving aside questions of whether OEM software is genuine, if any online product is meant to be genuine, probably the best way for a seller to prove this would be to (i) provide a letter online from the software companies confirming it is genuine; and (ii) let you download it freely for evaluation purposes. Later you can purchase the serial number and/or the original CD assuming no one else has purchased it first (everyone else who has downloaded it will have to remove their copy). Or, the seller may deliver the CD to you for free and you can pay for the serial number and CD after evaluating it. This is a similar principle to the Doubleday CD Music Club where the editors may select CDs to send to you for free and you can always return the CDs at no charge to you if you don't want them. But under no circumstances should you pay for the products you can't download and test (at least your money may not be all lost should it be bogus), or have them easily verified as genuine by an independent source (whether it is yourself going to the vendor in person, or someone else such as eBay).

If in doubt, please check your local newspapers and visit the seller in person to verify the products are genuine. Or use eBay and choose genuine second-hand digital products to save on money. Or work with friends to share genuine products (e.g. by visiting a public multimedia access shop in your local community, such as PhotoAccess in Canberra). Otherwise be prepared to purchase the full and latest products from the manufacturers for your own personal copy (which inevitably means you will have to find ways of getting rich).

NOTE: And if OEM software can be genuine according to Adobe, you may have this option as well. The tricky part is finding out where to purchase the software from genuine dealers.

Still emphasising the piracy problem...

Some authorities tried to emphasise the seriousness of the piracy problem in May 2005 by using the latest Star Wars: Episode III - Revenge of the Sith as an example. An Australian distributor has highlighted the problem by showing late on Thursday 19 May 2005 to newspaper reporters how two copies of the film had been leaked onto the BitTorrent file-sharing network.

Whether it is the result of organised criminals or the average citizen on the street, it is unfortunate some idiots want to file-share their own personal copy of the film to everyone else instead of keeping it to themselves. Of course, one cannot discount the possibility that some movie companies could be trying to set an example by getting someone within the industry to upload a copy nearly a day before the opening of the film according to claims made on http://www.waxy.org/.

But we have to keep the whole thing in perspective. On its opening day on Thursday morning for Australian audiences, the Star Wars film already grossed A$3.56 million. If we added all the other countries into the equation and let the film do its thing in cinemas for at least a month together with revenues from DVD sales and hire, then what do we have?

We wouldn't be surprised if the film manages to rake in over US$100 million (38), which should be more than enough to cover all expenses, including actors' fees, distributors' costs and so on. What's left should be a very hefty profit which can be used for investment purposes to cover such things as people not paying to watch the film because of movie piracy.

Whether it is a question of poverty, some people having a gripe about the current capitalist system, or people wanting to have their own personal copy to enjoy at home, we surely must learn to be appreciative of the amount of profit we can successfully generate from a film like this.

Later, if the companies are still worried about piracy, they ought to consider making the film extremely cheap and easily available to everyone to help quash any hope of the well-organised pirates ever making a profit.

UPDATE
27 January 2007

Warner Bros has decided to tackle head-on the DVD piracy problem in China two years ago by selling the real thing more cheaply, quickly and distributed as widely as possible in the nation. It is making some significant in-roads where the genuine products are available in high quantity. But where the DVDs are not in high numbers, the low income of Chinese people are still supporting the piracy industry.

***

Because in the end, all works eventually become public property. In the initial stages, we protect what we can to help make a profit because this is how society works today. Then, eventually a time will come when we have no choice but make the things we create accessible to everyone as cheaply as possible (because no one wants to buy it).

This is how life should work if we are genuine at helping everyone to become the best they can possibly be for society.

BitTorrent file-sharing network taking over where Napster left off

While Napster was caught in a copyright problem as it served information from users freely from fixed locations across the US, a new BitTorrent peer-to-peer file sharing network community has been established allowing virtually all kinds of documentaries, films, movies, music and e-Books to be shared freely with everyone on the internet.

BitTorrent is still a cause for concern for movie makers as the Star Wars movie episode above would seem to indicate. However, the amount of illegal stuff is much less than previously thought, possibly because of more sophisticated and effective means of tracking people down.

Businesses see piracy as a global epidemic

The above example with the latest Star Wars wasn't a particularly good one for highlighting the piracy problem (give the high profits already made by people like George Lucas). So now the heavyweights in the music and movie industries have decided to combine statistical figures worldwide to show the apparent global epidemic sweeping the world known as piracy.

According to a report released by the industries, it is estimated that 1.2 billion fake CD/DVD discs were produced and changed hands in 2004. The authorities also claim the number of pirated copies sold in 31 countries exceeded the number of legal copies sold. However the countries chosen were those whose citizens tend to be among the poorest and in need of access to cheap products compared to better paid citizens in developed nations.

The countries chosen included China, Indonesia, Russia, India, Spain, Chile, Argentina the Czech Republic and Greece. Not exactly the US, Australia, UK and other of the world's richest nations.

In developed nations, the figure is believed to be much lower. Some experts say less than 10 per cent of the market are pirated discs. Compared this to the chosen countries of China (85 per cent), Indonesia (80 per cent), Russia (66 per cent), India (56 per cent) and Spain (24 per cent).

At any rate, a number of those individuals or groups who do get involved in piracy are not only from poor families, but tend to have strong links to organised crime as a means of escaping poverty and achieving their own goals. And now the seriousness of the problem is being raised to an unprecedented level when chief piracy investigator for the Australian music industry, Michael Kerin, said some of the piracy operations were used to fund terrorism.

To emphasise the problem, Kerin said there was a decline in the number of legitimate music discs sold in 2004 within the Australian music industry of roughly 4 per cent to 63 million. But he doesn't explain why the decline. We are led to believe the decline is due entirely to piracy.

After mentioning the figures overseas for selected countries and a decline in legitimate music discs sold in Australia, Kerin gives the impression this is a serious problem in Australia when he mentions 19 police raids in 2004 netted 30,000 to 40,000 discs at a time showing the sophisticated nature of some well-organised piracy operations. (Needham, Kirsty. Pirated music becomes global epidemic: The Sydney Morning Herald. 25-26 June 2005, p.7.)

What would happen if poverty is eliminated throughout the world and there was no more than 10 per cent piracy going on in all nations? Would the music and movie industries still be up in arms over the loss in profit?

You would think the industries are crying poor after revealing these figures to the public.

Businesses see piracy as a global epidemic

Using those world statistics wasn't a good example either, so again the movie industry has decided to crack down on people responsible for stealing and making available copies of the latest Star Wars film and commercial software programs known as warez and then try to show the large-scale operation in place to track down the people who supply pirated copies commercially. In this way, hopefully most people will be frightened off from pirating software.

However the biggest difficulty the authorities have in tracking all pirates in the world are the way underground Internet sites operate. Many require passwords to access computer servers and many of the servers are located overseas in countries considered difficult to get local authorities to do anything or the pirates themselves more around regularly enough. Add to this the encrypted chat rooms these pirates and their users use and it becomes extremely difficult to infiltrate the groups with any reasonable degree of success.

So instead, the authorities try to lure the more unprofessional and unsuspecting pirates to leave unauthorised copies of commercial works not licensed or owned by the pirates on seemingly innocent-looking servers set-up by the Federal Bureau of Investigation (FBI).

The main concern the authorities have in relation to warez groups include RiSCISO, Myth, TDA, LND, Goodfellaz, Hoodlum, Vengeance, Centropy, Wasted Time, Paranoid, Corrupt, Gamerz, AdmitONE, Hellbound, KGS, BBX, KHG, NOX, NFR, CDZ, TUN and BHP (not the Australian steel-making industry).

By the time this is written, some of these groups would disappear. But not all would get caught. The risk that some groups will move elsewhere and establish new names is highly probable. That's the nature of the underground societies.

Spies at Versiontracker.com?

Another technique to keep information legal and under control is for major software manufacturers to inspect new commercial files created and distributed at places such as Versiontracker.com. You will notice this when so-called users keep asking for the files to be "optimised" or updated using the latest commercial software but never actually purchase the files in their current form even if the users are fully aware the files can be fully updated and run by the users themselves using their own latest software.

This is how software pirates are often caught out. Pirates usually think that by creating something with the software, no one would ever know you have pirated software. Nothing can be further from the truth, especially for the latest software. You see, the files you create with your software contain enough information about the software you used. Even if the files are embedded in another file, the spies for the software manufacturers can check the files. If the serial numbers (generally encrypted) in the files are from pirated sources (e.g. keygen or serialz), there is a very high probability the files were probably created with pirated software (although it doesn't necessarily prove this is the case).

Remember, if you own a particular commercial software legitimately and want to use an older version of the software for whatever purposes and your current serial number cannot be used, it is okay to obtain a keygen or serialz for the older software if there is nothing in the license agreement to say you can't. What the authorities are more interested are those people who are clearly using the latest software and using pirated serial numbers.

Because if you have the latest commercial software, there is no need to use a pirated serial number. It is as simple as that!

But then again, you could really confuse the authorities if you like by getting a pirated serial number for your legitimate and latest commercial software and see what happens. If the authorities can successfully track you down, you can show your original installation disks. The most the authorities can do when faced with this evidence is to slap you on the wrist for being a nuisance and wasting their money.

UPDATE
5 September 2005

The Federal Court of Australia has ruled KaZaa's warning to members on its web site not to use the KaZaa software for illegal purposes is ineffective. It ordered KaZaa to modify its software so as to force users to pay for the downloaded music to help make the process legitimate instead of letting advertisers pay for it and giving the impression to some young people it is okay to share freely other MP3 files.

Is there an example of this online? Well, here is a likely example of the sort of system the music industry and the Federal Court of Australia wants to see on the internet:

http://erplease.com/mus/

In the meantime, people will create their own black market peer-to-peer file transfer programs (probably with encryption) and transfer files secretly and quietly without the authorities ever knowing about it.

Have the authorities really won the battle?

UPDATE
1 October 2005

Putting a plug on the free transfer of music files over the internet has well and truly begun thanks to the music industry deciding to flood the online market with legitimate music downloads. For as low as A$1.49 per track, you can download the latest music from http://music.ninemsn.com.au/ or http://www.soundbuzz.com/. But remember, the music may require special plug-ins or software to be installed in order to play the music files and you might be restricted in how the music is played (e.g. the number of times you can play the files and/or burn the files on CD, or the quality might be poor).

For such a low price for music, it might be worth downloading at least one complete song just to find out what it is like. At least you will know whether this is the best option for you to purchase music online. And if so, you may wish to consider re-recording the music you purchase to remove any restrictions (when you purchase a CD, you are not restricted in how many times you can play the music, are you?).

Another web site you may wish to investigate for legitimate music downloads is http://www.chaosdownloads.com/. Price is about A$1.89 per track.

UPDATE
21 January 2006

The US Justice Department has issued subpoenas to four major internet companies in August 2005 to hand over information relating to the queries typed into search engines by users over the course of, say, a typical week. The reason being that it wanted to determine how many average users access child pronography online and how easily children can access this material on the Internet.

Being aware of privacy issues and not armed with sufficient evidence to prove how extensive the problem is, the department initially asked for this information without expecting identifying information to be provided.

In response to the request for information, three of the four companies — AOL, Microsoft and Yahoo — have provided information to a certain degree but not all. Google refused raising the possibility the company may be forced to later reveal the secrets and extent of how it gathers identifying information about users if the department pursues Google in gathering the information it wants.

In other words, Google can, and probably has, linked all your search queries made with Google to various identifying pieces of information it has collected about you such as your IP address, the names and physical addresses you have supplied to Google when accessing its free email service known as Gmail, your email address with Gmail and the messages you receive and send (made searchable by Google). And if you advertise with Google, it will know your bank account details and home address.

Of greater concern is the privacy of individuals using search engines and what they can search online. Ignoring child pornography, which should be curtailed, the same technique can be used to identify and locate users accessing any web site found at least through the four major search engine sites.

UPDATE
18 January 2006

Yahoo is prepared to turn over information held on users' Yahoo free email accounts to governments last year without asking for an explanation or to understand the nature of the request. Evidence for this can be found in the case of a Chinese journalist named Shi Tao who was jailed by Chinese authorities last year for the unauthorised sending of a memo through the Yahoo email network to a democracy group in New York. On first glance this may seem somewhat excessive until we realise the memo had actually discussed a sensitive issue for the Chinese Government about the Tiananmen Square massacre. Mr Tao was convicted after the government learned of the IP address used to send the email, which was tracked to his own computer at his place of employment.

Will other search engine and free email-based companies do the same?

Well, it is known Google can collect a great deal of information about users (e.g. storing search queries, IP addresses, names and addresses stored happily by Gmail users etc) presumably to help make tailored search results and advertisement to meet the needs of users working from specific IP addresses (if cookies are not enough) and, with the help of Gmail, have them linked to their names and addresses.

Recently the US Justice Department did try to subpoena Google.com to release partially sensitive information concerning the extent of users searching for illegal information such as bomb-making and child pornography. The company refused.

On the other hand, it was willing to impose at the request of the Chinese government a form of self-censorship at its http://www.google.cn/ site to help restrict sensitive information from reaching China's citizens (about 110 million Internet users at last count) and will not allow ordinary users outside of China to use the service to see what is restricted (e.g. try typing http://www.google.com/ or http://www.google.cn/ and you will be redirected to http://www.google.com.au/ if you live in Australia). Although the company is pledging to reconsider the decision (Government-owned Chinese servers accessing the Google web site should do the censoring, not Google), the need to control access to information on the Internet by the authorities is growing by the day.

How long before the Internet loses its appeal and power to be a free and open source of information for people to make decisions for themselves?

NOTE: The problem with major search engine sites such as Google is their ability to remember search results and link them to any identifiable features. The latter part is considered the most dangerous for privacy reasons. Yet it remains fundamental to the business model of major search engine sites to have this identifying feature so they can deliver tailored-made advertisements from paying businesses to specific individuals. And it is also fundamental for law enforcement agencies to help track down individuals. Instead of providing quality education and learning to live within our means, we create a Big Brother world thanks to the recording of our electronic footprints in cyberspace.

UPDATE
1 September 2006

News has emerged that AOL had accidentally published online for a few hours the details of 23 million searches made by 650,000 of its customers over a period of three months this year. AOL bought the data from Google at a price. While the data was pulled down, it wasn't without some users able to copy the information and present it on other web sites. AOL has sacked the researcher who published the material as well as his manager (and AOL's chief technology officer, Maureen Govern, resigned from her position as a result of the debarcle), but the action may have turned out to be a useful service for customers as they learn more about the type of information gathered by Google. In particular, we now learn that the data reveals much intimate details about individuals than is considered socially acceptable. So much so that thousands of AOL customers had become aware of the situation and are now changing their online habits. Very wise! The data may have appeared innocent enough with numbers used in place of the names of customers. But all it took was someone to know a little about somebody else and then it is possible to put in the search queries made by this somebody into Google to discover the true identity and name of the individual concerned.

For example, user number 11110859 from New York entered search queries that revealed information about "losing your virginity", concerns for three weeks about being pregnant, asking questions about why people hurt others and more. Do companies really need to know this kind of information?

UPDATE
26 February 2006

To brighten up the already battered image of the music industry going after 10-year-olds in the law courts for copyright infringements, a positive story has emerged showing consumers can finally legitimately purchase their favourite individual songs and videos through self-service ATM-like digital kiosks or terminals at Sanity, Virgin and HMV stores.

The kiosks, run by Brazin, will permit searching, sampling and purchasing of up to 400,000 songs (or 30,000 albums) and videos and have them burned on a CD in five minutes. Or, if you prefer, transfer them to your portable music players or flash drives via a USB port.

A single track costs A$1.69 plus A$2.00 for the CD. Individual music videos cost A$3.99. Purchasing is done at the store's cashier where you will receive a receipt number. Return to your kiosk and enter the number and you are ready to burn a CD (the best way for anonymity when paying by cash). In the future, the kiosks should be able to let you pay by EFTPOS or credit card if people are happy to have some of their identifying information kept on a database by major music industry labels.

The only drawback in the kiosks is that the music is not compatible for playing on an iPod because Apple uses different digital rights management systems for their audio files. Apart from that minor irritation thanks to Apple decision to "think different" as the old motto goes, this is a major step forward in the flexible delivery of music and video to the consumer without all the fuss of law suits.

And now that the latest global figures issued by the International Federation of the Phonographic Industry on the number of illegally available music files on the internet has had a 20 per cent drop on the 1.1 billion peak in 2003, the music industry is happier too.

Most observers believe the drop is attributed to the introduction of legal downloads such as digital kiosks and subscription services online. Either that or people are learning to illegally transfer music to trusted friends without advertising the fact on web sites and public servers, making it harder for authorities to track.

Alternative online sources for legitimate download of music can be found from the following web sites:

Sanity - http://www.sanitydigital.com.au/

Apple iTunes - http://www.itunes.com/

UPDATE
31 March 2006

We still notice how many people are still concerned about video or audiotaping a free-to-air episode of an educational series or songs from a radio station in the comfort of one's home for personal use because of copyright issues. Seriously, if authorities thought it was such a problem, why permit businesses to sell DVD and video recorders and machines capable of recording audio to consumers?

What the authorities are going after are the people who make a multitude of copies and illegally distributing for free or at a price the copyright material without getting a license, permission and/or paying royalties to the artists and official distributors.

The other concern is that some people think making just one copy of your music for your own personal use is illegal. Depending on the copyright laws in your country, there are laws allowing people to make (1) copy of the material (e.g. software, music etc) for backup purposes. So in case something happens to your original copy or you wish to preserve the original copy for as long as possible, you can still use your backup copy without a problem. What the law does not allow is multiple backup copies.

You will often see this in license agreements for software you purchase (legitimately of course). Music CD and movie DVDs are not so obvious. But the music and movie industries understand consumers will have two copies in the home. One copy might be stored as MP3 files in a stereo system or a movie on the inbuilt hard drive of the video recorder and another copy, the original, on the CD/DVD disk. For personal purposes, there is nothing stopping you from making such a backup copy.

As for research and educational purposes, small portions of the material can be copied within the guidelines specified in the Copyright Act without fear of prosecution (you should check this in your own country).

There are still people who feel any kind of copying under any circumstances is totally illegally under the copyright laws. They amount this to stealing as if it is a criminal offence. This is not entirely true.

UPDATE
6 May 2006

The official position should Google find anything illegal will be to notify the authorities and ban the material from search results. As Google spokesman Steve Langdon said:

"Child pornography is illegal, and Google prohibits it in our products. When we find or are made aware of any child pornography, we remove it from our products, including our search engine.

We also report it to the appropriate law enforcement officials and fully co-operate with the law enforcement community to combat child pornography." (Dalton, Richard. Google accused of profiting from child porn: The Sydney Morning Herald. 6-7 May 2006, p.13.)

Some individuals believe Google could do more to supply more effective filtering software, plus warnings on the search results when illegal material is shown and have the users monitored and reported to law enforcement authorities should they access illegal material.

We will see more and more control of the information until we sort out the problem of making money to survive and get rich and ensuring all people are loved and encouraged to do the right thing by everyone.

UPDATE
10 June 2006

Actually the Australian law to allow the recording of a copyrighted (i.e. someone else's) free-to-air television program, music or software on a video tape, hard disk or whatever (where you haven't paid for it) for personal use hasn't caught up with the times. It is still illegal to copy this kind of copyrighted material unless you have purchased a copy (and only then a backup copy may be allowed).

Attorney-General Philip Ruddock intends to change the laws slightly to allow recording of one copy of this material. However, it will be more restrictive and virtually unenforceable compared to the US copyright legislation.

The US has a "fair use" provision allowing a certain level of flexibility in copying material for personal use including the ability for people to watch again-and-again the copyrighted material recorded from television and radio for personal use. The Australian version of the expected new legislation will allow copying of the material for personal use but it must be deleted after watching it once only.

Also the material must be recorded only on a different format for personal use (i.e. you can't share it with other people). For example, music on a CD can be copied onto an MP3 player. But after it has been listened to once, you must delete the MP3 music. And you cannot copy the music onto another CD.

Again the question must be asked, who is going to be wandering around people's homes checking you have watched, listened or used a copyrighted material only once, is on a different media format, and have deleted it (let alone whether they have not shared it with anyone)?

Again people will make a mockery out of the Australian law.

UPDATE
20 July 2006

The Australian Federal (Howard) Government is doing well to begin controlling the types of information available on the internet to children so long as the control is at the ISP end (perhaps with a password for adults to bypass the filtering). Filtering tools at the computer end is too easily bypassed by children. However, the problem remains. No filter is perfect. Information can still get through in spite of the world's best filtering technology. Again filtering is no substitute for a quality education when preparing children for the reality about human society today. It is time we all face up to the reality we have created.

UPDATE
28 July 2006

The continuing Federal Court battle between the major music record companies and Sharman Networks since 2004 has meant it is costing too much in legal fees to continue the fight. Not for the record companies who are receiving healthy annual profits, but for Sharman Networks as legal costs bite into their remaining profits. Talk of having to pay billions of dollars in lost royalties has also frightened the Sydney internet company. Consequently Sharman Networks has made a settlement worth A$151 million to keep Universal, Festival/Mushroom, EMI, Sony BMG and Warner Music Australia happy.

Ms Nikki Hemming of Sharman Networks said:

"[The settlement] marks the dawn of a new era of cooperation [between file-sharing services and the entertainment industry]

This settlement ensures that we will be working together with the content providers to the benefit of consumers, businesses and artists." (The Canberra Times: Pay-out on music piracy applauded. 29 July 2006, p.14.)

The music industry's lawyer Michael Williams said:

"[The settlement was] a turning point in the fight against online piracy.

The payment of compensation by Kazaa, after it was held accountable in an Australian court, demonstrates that there are no piracy safe havens when it comes to the internet." (The Canberra Times: Pay-out on music piracy applauded. 29 July 2006, p.14.)

Well, not on an official capacity. It certainly doesn't 100 per cent stop the exchange of music files, software and the works in, say, an encrypted manner over the internet among trusted individuals. And one friend can simply walk up to another friend to pass a copy of anything. The settlement is aimed to hopefully reduce the number of people on the internet using Kazaa to share anything.

Kazaa will be required to incorporate filtering technologies into its software to stop the distribution of copyright material.

Wi-Fi connections subject to sweeping new US laws

In another case filed in the US Supreme Courts by the US Department of Justice between a Minnesota woman named Jammie Thomas-Rasset, a single mother of four, and the major record labels, a jury has decided Ms Thomas-Rasset has violated copyright law by downloading and then making available to others 24 songs on Kazaa, a peer-to-peer file-sharing network. It is likely she will be charged and ordered to pay US$222,000 for her actions. However in October 2007 the judge presiding over the case decided to overturn the verdict claiming the amount was "wholly disproportionate" and "oppressive", only to be pursued in court a third time and a different judge decided he would be harsh on the woman by ordering her to pay US$1.5 million or US$62,500 for each of the 24 songs. With legal costs, this would amount to US$1.92 million to the six record companies that brought the matter to the courts — Capitol Records, Sony BMG Music, Arista Records, Interscope Records, Warner Brod Records, and UMG Recordings. If another judge looks at the case, the amount would probably be lessened considerable again. But it seems the woman has decided against pursuing the case and will accept responsibility even if the likelihood of paying the full amount is virtually zero. The decision is a reflection of the judge's view on the copyright infringement and felt it is necessary to set an example to stop other people from illegally downloading or making available copyrighted music online.

On hearing the outcome, the Recording Industry Association of America (RIAA) stated:

"We are again thankful to the jury for its service in this matter and that they recognised the severity of the defendant's misconduct," the RIAA said in a statement.

Now with three jury decisions behind us, along with a clear affirmation of Ms Thomas-Rasset's wilful liability, it is our hope that she finally accepts responsibility for her actions." (ABC/Yahoo/7 News: Woman to pay $1.5m for downloading music. 5 November 2010.

Yet the case still has not stemmed the flow of illegal material from being downloaded or made available on the internet. Indeed the material is becoming available from more obscure servers located in Russia, Romania or other similar Eastern European nations and the source of the information is now anonymous, making it virtually impossible to identify specific individuals supplying the information.

So now the next step is for the RIAA to stop suing people and instead focus on the internet service providers for hosting the information. And even if that is successfully achieved, individuals who know each other will use peer-to-peer software to send illegally-supplied information directly to the people they trust. It will get back down to the old days of when friends shared tapes, vinyls, CDs or DVDs (especially if the material is not cheap enough and/or available online to purchase).

At any rate, following the Thomas-Rasset case, both the Democrats and the Republicans in the US House of Representatives have introduced a 69-page bill known as the SAFE Act to help increase civil penalties for copyright infringement as a deterrent. The bill also makes sweeping changes in terms of boosting criminal enforcement and permitting a new federal agency with powers to crackdown on national and international copyright violations. For the first time, the new bill will also target individuals and organisations with Wi-Fi connections to the public. If the individuals or organisations are knowingly aware of illegal copyright material and are not removed, they could face prosecution.

The bill goes further by saying individuals and organisations are required to report illegal images such as child pornography, and obscene cartoons and drawings made available to the public (mainly to stop sex offenders and Internet predators).

Fines of up to US$300,000 for a breach of the new laws would be enforceable.

The new bill is broad enough to include individuals, coffee shops, hotels, libraries and some government agencies offering a Wi-Fi connection to the public.

To help identify individuals and organisations on more broader networks such as the internet, social-networking sites, domain name registrars, ISPs and email service providers such as Yahoo, Gmail and Hotmail may be required to retain the complete contents of a user's account for police inspection including details of the user's previously known and most current IP addresses to assist in physically locating the user.

Copyright music available to download for free

It is not clear whether sales of music CDs has dropped significantly because of the internet (e.g. Apple's iTunes store), but it seems the major music recording companies such as Sony have allowed Qtrax to sell music for free. The music is apparently paid for by the advertising other companies and individuals provide on the web site.

So you can download the same 24 songs Mr Thomas-Rasset had obtained without a cost to you #&151 just so long as you download them from the same web site so the record companies can continue to receive money. Otherwise you will be in trouble.

Has the end of the traditional "bricks and mortar" music shop finally arrived? Probably not. It is likely the owners of these shops will specialise in niche markets where people think higher quality music can only be obtained from CD or vinyls.

Latest decision on handling copyright infringers: you must be knowingly aware and you must take action when requested

The legal decision on who to blame for copyright violation by some users continues can continue to swing in different countries between blaming the users to blaming online service providers, or perhaps both?

Now, in a ruling by US District Judge A. Howard Matz on 14 September 2009 that stunned film and music industry giants, legal action taking against Veoh by Universal Music Group on behalf of powerful entertainment conglomerates because of the alleged acts of copyright infringement committed by Veoh's users could not be justified because it was found Veoh is protected by the Digital Millennium Copyright Act's safe harbor provision. Why? Veoh had already implemented filtering technologies on its web site to remove infringing material the best it could. Although not perfect, they were not aware of other infringing material that bypassed the system and therefore could not be held liable for prosecution because of the actions of these users until they were fully informed.

The entertainment companies are regrouping and are currently seeking an appeal on the decision while the ruling isn't binding as yet. Until then, the onus appears to be on the content creators and copyright owners to chase, identify and capture these unruly users allegedly involved in copyright infringements including those involved in the uploading of unauthorized copies of movies, music, and TV shows televised from pay or free-to-air stations. And if that is not possible, the content creator must file a "take-down" notice with the online service provider harboring the offending users by showing evidence of copyright infringements. And then it is up to the service provider to comply with the notice in order to avoid being seen as aiding and abetting with the users.

As Chris Castle, an attorney and outspoken proponent on the rights of artists said:

"According to some interpretations of this new law, copyright owners — from multinational corporations to independent songwriters — are required to stand at the ready on a 24/7 basis to police the Internet." (Sandoval, Greg. Stunned film, music sectors react to Veoh decision: CNET News. 15 September 2009.)

This appears to be the case in an Australian Federal Court hearing on 6 October 2009 where the Australian Federation Against Copyright Theft had warned iiNet of illegal files being shared online by its users, but the internet service provider allegedly did not take action other than having prepared a policy document on how to handle repeat copyright infringers. It is not entirely clear if the copyright agency provided specific internet addresses for iiNet to investigate and pull down or whether it simply wanted iiNet to do the work of purging everyone it could find for infringing copyright. The US approach appears to require specific details be provided in the take down notice.

Perhaps iiNet is concerned about losing customers (and profit) if the action was taken?

In the meantime, iiNet could be subject to legal prosecution by film, television and music companies for not taking appropriate action.

So finally, after a long an arduous debate over the issue, the question of whether online service providers are subject to legal prosecution by film and music industry giants because of the actions of some online users is now falling on the side of whether the providers were knowingly aware of the acitivity of specific users and have taken action to stop it. For example, YouTube and Veoh have filtering systems in place to remove infringing material off their sites. However they are not perfect systems. Other systems have to be implemented. As Fred von Lohmann, senior attorney at the Electronic Frontier Foundation, stated in the end it is up to the copyright owners to look online for evidence of infringement.

Or, in the case of people working at the film and music companies, they may have to spend time (probably on the weekends) rummaging through millions of web sites for examples of violation and giving web addresses to the service providers for them to take down, and hope the users violating the copyright infringement will not try to re-upload the material onto a different web address.

Well, on the positive side, at least it means companies will have to provide more people with real jobs and an income to help find those offending materials which in the end could turn out to be the ultimate solution to all users who may be contemplating on infringing copyright material: give them enough money to afford the cost of buying a legitimate copy of the material for themselves.