Music Pirates, You're Sunk

In early September, the U.S. music industry is planning to break every known rule of corporate public relations by suing hundreds of high school valedictorians, pilots, firefighters, entrepreneurs, and other seemingly upstanding citizens for stealing songs online. The legal confrontation will pit a small group of powerful, technophobic oligopolists against a hip, youthful army of digital sophisticates — who are the very heart of the companies’ consumer base. It doesn’t take a poll to figure out which side is going to win the battle for hearts and minds.

In the Steven Spielberg version of this conflict, the plucky rebels with the long hair and grandiose rhetoric would ultimately win the war. Until now, that’s how the script seemed to be playing out. The Recording Industry Association of America (RIAA), the industry’s main lobbying group, has failed to shut down many of the key file-sharing services that facilitate song piracy, such as KaZaA, Morpheus, and Grokster.

Some Internet service providers, such as Verizon Communications (VZ ) and SBC Communications Inc. (SBC ), have balked at handing over the names of their customers to RIAA lawyers. And Senator Norm Coleman (R-Minn.) has lashed out at the industry for sending threatening paperwork to “unsuspecting grandparents whose grandchildren have used their personal computers.”

MEDIEVAL PENALTIES. But don’t be fooled by the industry’s rough stretch. The RIAA is methodically overcoming all these nuisances — and its upcoming legal war on digital pirates is shaping up as a massacre. Copyright law is unambiguously hostile to people who swap music files over the Internet. And the penalties are medievally harsh — up to $150,000 per song. That means the average college sophomore with 10 weeks of music on his hard drive theoretically faces more than $1 billion in liability.

Oh, and by the way, penalties for violating copyright law may not be dischargeable in bankruptcy court. “The remedies are so terrifying that even if you have a good defense, you have to think twice,” says Fred von Lohmann, an intellectual-property attorney at the Electronic Frontier Foundation, one of the industry’s staunchest critics.

This fear and awe campaign — which the RIAA has publicized in a variety of ways, such as sending instant messages directly to KaZaA and Grokster users informing them that “when you break the law, you risk legal penalties” — already appears to be having an impact. After the number of households downloading music from the Internet climbed to a high of 14.5 million in April, it dwindled to 12.7 million in May and 10.4 million in June, according to market researcher NPD Group Inc.