money.cnn.com/2004/12/14/news/fortune500/piracy/index.htm
Fortune 500 graphic Hollywood steps up piracy fight Major studios announce fresh crackdown on illegal downloads. December 14, 2004: 3:26 PM EST By Krysten Crawford, CNN/Money staff writer NEW YORK (CNN/Money) - The Motion Picture Association of America announce d a new campaign aimed at slowing the illegal downloading of movies off the Internet. The MPAA, the main lobbying group for Hollywood's major studios, held a n ews conference Tuesday afternoon to trumpet the latest crackdown, which representatives said included both civil lawsuits and criminal prosecuti ons around the world. "We have taken action against over 100 servers in many countries on four continents," said John Malcolm, the director of worldwide anti-piracy at the MPAA. The announcement comes one month after the MPAA filed its first batch of lawsuits against more than 200 individuals it accused of stealing movies off the Web. The measures taken this week, however, were not directed at individuals w ho download movies. Instead, the targets were people who act as conduits between downloaders and three specific "peer-to-peer" file-sharing tech nologies: BitTorrent, eDonkey, and DirectConnect. These intermediaries provide users with lists of movies, songs and televi sion shows that can be swapped with other users. "These people are para sites leeching off the creativity of others." Malcolm also said that legal notices have been sent to Internet service p roviders ordering them to intervene and shut down these middlemen, also known as "trackers," "servers" and "hubs."
BitTorrent, the fastest-growing peer-to-peer service on the Internet, and eDonkey together make up the bulk of all peer-to-peer traffic, accordin g to CacheLogic, a Cambridge, England-based market research firm that tr acks Web traffic. BitTorrent is especially frightening to Hollywood because it can download movies in just a few hours. And the software is designed so that downlo ading a film gets easier as more people try to access it. The actions were not directed against the creators of BitTorrent, eDonkey or DirectConnect. The MPAA did not dislcose the numbe r of lawsuits filed, whether arrests were made, or the identities of the Internet service providers who received "cease-and-desist" letters. But the announcement follows a decision last week by the US Supreme Cou rt to intervene in a seminal case that pits the movie and music industri es against two other peer-to-peer services, Grokster and Morpheus operat or StreamCast Networks. While Malcolm said there was "no connection whatsoever" between the high court's Dec. Analysts say that Hollywood does not face the severe crisis that the reco rd industry confronted when the Napster file-sharing appeared a few year s ago and music downloads turned into a mass free-for-all. There are several reasons for this, including the enormous amount of time it still takes to download movies and a lack of consumer interest in wa tching movies on computer screens. For now, reliable data on the prevalence of illegal movie downloads and t he cost to Hollywood do not exist. The MPAA itself, which claims its on track to lose $35 billion this year to the black market in physical DVD s, does not yet know how much money the industry loses on the Web. The MPAA's Malcolm said Tuesday that the problem of Internet piracy is on par with widespread copying of physical DVDs. In three years, he estima tes industry losses from online theft will be "staggeringly high." That is why Hollywood is moving now on two fronts: to use the courts to r ein in piracy and to develop technology that, if not impenetrable, at le ast makes stealing difficult. Andrew Parker, chief technology officer of CacheLogic, the peer-to-peer t racking firm, was skeptical that law enforcement tactics can work. He noted that peer-to-peer traffic dropped after the music industry first launched a series of lawsuits against individuals accused of illegal do wnloading, but that overall downloading has since rebounded. What's more, he said, users have become adept at shifting from one techno logy to another, which is what he says happened when record companies st arting suing users of Kazaa, previously the No. "We saw a sudden shift in usage patterns to BitTorrent and away from Kaza a," said Parker. But Charles Sims, a New York lawyer who has represented entertainment com panies in court cases against peer-to-peer networks, said Hollywood reco gnizes that litigation is not the panacea. "The (lawsuit) route is not perfect, in the same way that the war against drugs isn't perfect either," said Sims, a partner in Proskauer Rose. "B ut there's probably less heroine and cocaine out there now than if we we ren't doing anything."
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