If industry rumblings are correct, the recording industry may be preparing a legal assault against ISPs. Multiple industry sources to Digital Music News have pointed to the possibility, and recent comments by IFPI chairman John Kennedy correlate with the chatter. "It’s been a year since I asked for (the ISPs’) cooperation, and I’ve effectively had zero response," a recent piece in The Financial Times quotes the IFPI chairman as saying. Kennedy has called for ISPs to monitor and limit access to users that trade files illegally, while leaving the door open to litigation if negotiations are unsuccessful.
Challenging ISPs is a tremendous undertaking, though groups like the RIAA and IFPI have considerable legal tail-wind. The RIAA recently won a unanimous Supreme Court decision in MGM v. Grokster, paving the way for the future shutdown or conversion of a number of P2Ps, including LimeWire and eDonkey. Meanwhile, both trade groups have been diligently pursuing lawsuits against individual file-sharers, and the RIAA alone has targeted 16,000 swappers. Still, those efforts have failed to reverse record levels of piracy, and they are yet to revive a sagging physical CD sector. That lack of progress could be creating pressure to target the ISPs, who are supplying users with the pipes necessary to share files ad nauseam.
A Supreme Court victory is nothing to sneeze at, though the opponent was a relative lightweight compared to the internet access industry. While their affect on the overall music industry has been profound, P2P companies are essentially minor league players in terms of overall earnings. Revenues mainly come from low-CPM banners, and most companies are forced to deliver spyware and adware just to keep the lights on. The Electronic Frontier Foundation (EFF) – which represented Grokster and Morpheus in the case – is certainly a formidable opponent, but still one that the RIAA could defeat. Overall, the P2P industry simply has less weight to throw around, and file-sharing companies have a shelf life of only a few years at best. In comparison, ISPs are multi-billion dollar corporations that dwarf the recording industry in terms of legal firing power, spending ability, and political clout.
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