The Hollywood Reporter Esquire

New media adds to courtroom piracy debate

Criminal suspects learn quickly that everything they say can and will be used against them in court. Diversified entertainment companies might be headed for a similar lesson. Months after being sued by Universal Music Group for copyright infringement, News Corp.-owned MySpace and Sony-owned Grouper continue to fight the cases, arguing protection under what has become Web 2.0's calling card, the Digital Millenium Copyright Act. This despite the fact that sister companies 20th Century Fox and Sony's music and film divisions continue to wage aggressive anti-piracy campaigns, pressing some of the same arguments being wielded against their new-media affiliates by UMG.

No one is more aware of this balancing act than UMG president Zach Horowitz, who provided insight into his company's litigation strategy at a Grammy week luncheon for entertainment lawyers when he called out Sony and News Corp. UMG sued MySpace for copyright infringement after one of its biggest releases of last year, Jay-Z's "Kingdom Come," was circulated on the social networking site "before its release date, in its entirety, on demand, to potentially millions of listeners — for free — without our consent," Horowitz said. What would happen, he mused, if UMG decided to allow posting of studio films online in a similar manner?

The answer, Horowitz believes, is that the studios, through the MPAA, would shut it down, as they have hundreds of Web portals supporting technology that facilitates file-sharing. Indeed, the MPAA and the RIAA have recently recommitted to their worldwide litigation campaigns, suing thousands of individuals and Web sites that make available copyrighted content without permission. Horowitz argues that despite corporate ownership and massive audiences, MySpace and Grouper are no different, having built their businesses, in part, on the back of its artists' content.

Meanwhile, days before Horowitz's speech, Fox sucessfully subpoenaed YouTube parent Google to force the video site to turn over the identities of two individuals who illegally uploaded full episodes of "24" before they aired. The studio said it intends to vigorously pursue infringement suits.

It's an awkward position for News Corp., vigilantly protecting its copyrights against YouTube users but having to explain to Horowitz why it should not be responsible for what its MySpace members are doing with copyrighted music. Sony is in an equally interesting position, owning Sony Pictures and co-owning Sony BMG Music, an RIAA member, while defending Grouper against claims that UMG artists are having their songs ripped off by users.

The user-generated content sites have argued in court papers that they are different from individual "bad actors" or companies like Napster because they comply with takedown notices and are creating filtering software to help keep copyrighted content out.

But in a media world of increasingly murky alliances, Horowitz and UMG chair Doug Morris are smart to try to draw clear lines on infringement — even if it is merely to get the sites to the bargaining table, as happened with YouTube and others after Morris threatened to sue.

And if Sony and News Corp. want to test the legal waters, their first challenge might be to address why the studios' zero-tolerance approach to copyright infringement should be less stringent when applied to their own new-media cousins.