Audiogalaxy vs. the music industry: case closed

By Susan Rush
from CED Broadband Direct, June 18, 2002

Less than a month after the music industry filed a lawsuit against a Napster-like clone, the case has been settled.

Although specifics of the settlement remain confidential, peer-to-peer filing sharing service Audiogalaxy has agreed to pay the Recording Industry Association of America and the National Music Publishers Association a "substantial sum based on Audiogalaxy's assets."

Also as part of the settlement Audiogalaxy is required to operate a "filter-in" system, which requires Audiogalaxy to get consent from a songwriter, music publisher and/or recording company before a song can be shared with others over the Internet. Audiogalaxy could not be reached for comment.

The RIAA and NMPA filed the suit on May 24 in a New York court despite the fact that Audiogalaxy had been trying to thwart users from sharing copyrighted material -- the RIAA had called Audiogalaxy's effort insufficient.

"This should be a wake-up call to the other networks that facilitate unauthorized copying," said Hilary Rosen, chairman and CEO of the RIAA. "The responsibility for implementing systems that allow use of copyrighted works rests squarely on the shoulder of the peer-to-peer network."

The music industry successfully shut down the former prince of peer-to-peer file sharing, Napster Inc., last year. It has since brought lawsuits against several other similar companies, including Kazaa BV, Grokster Ltd. and Streamcast Networks Inc. It remains to be seen what affect this settlement will have on the peer-to-peer space. Audiogalaxy is one of the more heavily trafficked file-sharing Web sites, reporting more than 1.5 billion monthly hits in November.