Grokster and Morpheus v The Supremes

Malcolm Maiden is spot-on with his comments about the current court cases over file sharing technology.

As reported elsewhere in The Age, "Grokster and Morpheus, are before the US Supreme Court in an action that US experts say touches the capacity of the legal system to enforce copyright laws and ultimately affects elements of Western freedom."

And Australian software company, Sharman Networks, which owns KaZaA, used by about 200 million people and one of the most popular peer-to-peer applications on the internet was sued in the Federal Court in Sydney.

Maiden argues that the music and movie industries business model has been made redundant by the internet:

"But file-sharing is also an emerging telephony network, and a process that is central to the operation of the World Wide Web.

The industry's attempt to outlaw file-sharing is, in that sense, an attack on the architecture and logic of the internet itself - and the fecundity of the Net means it cannot succeed.

New models for producing and distributing information on the Net are emerging. In most cases, they generate thinner profit margins than the ones they replace, but that is the nature of the internet: it is a low-margin, high-volume network."

That last comment is particularly revealing. While new models are emerging, it's happening slowly. And the fact that the margins are thinner means that the new businesses that evolve with these models will be quite different in structure from traditional entertainment companies.

It's also worth pointing out that media companies are caught in the same bind. While peer-to-peer technology is not a direct current threat to news organisations they will inevitably face the same fate as film and music businesses.

The challenge is how to embrace the technology and work with it rather than try to shut it down.

Lawyer Harold Feld from Media Access Project was at the Supreme Court hearing and blogged about it here.