Recording Industry Launches 261 Lawsuits Against Individuals

   The Recording Industry Association of America (RIAA), a trade group that represents the major recording labels, announced its largest-ever set of lawsuits against individuals it says have stolen and traded music online. The RIAA filed 261 separate lawsuits yesterday, all against individuals who use Internet file-sharing programs such as Grokster and KaZaA. The RIAA also promised to launch thousands of similar lawsuits in the days ahead. Originally, the organization had hoped to sue the file-sharing services, but a court ruling made that action more difficult. Instead, the RIAA is now attacking the people who share the most music online.
   "Nobody likes playing the heavy and resorting to litigation, but when you're being victimized by illegal activity there is a time you have to stand up and take action," an RIAA spokesperson said without irony. But the notion of the recording industry being a victim is ludicrous: Instead of dropping audio CD prices throughout the years as the industry promised in the late 1980s, RIAA members instead raised prices significantly during the ensuing decade and a half. After 2 years of steadily declining sales, one recording label, Universal Music Group (UMG), finally announced that it would drop the price of its CDs by 30 percent, effective October 1. Arguably, this move should have occurred long ago--well before Internet file-sharing services were even technically feasible. The other major record labels should also announce similar prices.
   Meanwhile, earlier cases against individuals are winding their way through the courts. The RIAA is settling each case at an average cost of $3000 per individual, although some people have received much heavier fines, including a $15,000 settlement against a college student who illegally shared thousands of songs. The RIAA says that future settlement costs will be higher, as will any court verdicts.
   How such actions will affect the CD-buying public is unclear. CD sales are projected to fall 50 percent this year when compared with CD sales in 2000, and revenues are down 14 percent. "The lawsuits and the new pricing policy address the same issue," Zach Horowitz, UMG's president and chief operating officer (COO), said. "Our industry is being ravaged by piracy. The lawsuits will help to deter illegal file sharing. Our new prices will help stimulate retail sales. At the same time, we're offering our music through a host of legitimate and compelling online services. The combination of all these efforts is aimed at reinvigorating the music business."