File-Sharing Doomed, Warns Exec
Peer-to-peer file-sharing companies in the U.S. will cease to exist in their current forms over the next few months, the president of MetaMachine, the company responsible for the eDonkey software, predicts.
Speaking at a Senate Judiciary Committee on Wednesday, Sam Yagan said that in order to avoid expensive litigation, file-sharing companies will have to change their models to become similar to iTunes or the new Napster or face expensive legal battles.
MetaMachine won't be an exception. "Because we cannot afford to fight a lawsuit--even one we think we would win--we have instead prepared to convert eDonkey's user base to an online content retailer operating in a 'closed' P-to-P environment," he said.
Yagan's comments have been posted on a Senate Web site. MetaMachine created the eDonkey P-to-P software client.
Legal Enganglements
Companies like MetaMachine, he explains, will have to comply with terms of deals made by entertainment rights aggregators and to do so they'll have to build centralized indexed searches, filters and closed networks in order to ensure that their users aren't conducting illegal file sharing. Such a setup is different then most P-to-P file-sharing companies today, which usually don't have centralized servers holding content.
This dramatic change is happening as a result of the Supreme Court's ruling in June on the MGM v. Grokster case. The court ruled that someone who offers a tool and promotes the use of the tool to infringe on copyright is liable for the user's infringement. Since that decision, the Recording Industry Association of America (RIAA) has sent cease-and-desist letters to leading P-to-P companies including MetaMachine, threatening litigation based on the RIAA's interpretation of the ruling.
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