Last updated: July 1, 2009 5:20 pm

Online piracy

Strike the Jolly Roger – the scallywags have deserted The Pirate Bay. The file-sharing site’s $7.8m sale to Global Gaming Factory, a Swedish maker of software for internet cafés, marks the latest victory of sorts for record companies in their costly struggle against online piracy. The sale will provide TPB’s founders with enough loot to offset the $3.8m fine handed down after their conviction on copyright violations in April, but its swashbuckling days are over.

GGF’s plans to turn TPB into a legitimate file-sharing business look shaky – users deserted Napster and Kazaa, two of the internet’s original marauders, when they attempted similar transformations. Attempts to build a business at BitTorrent, a company formed around the technology that powers the TPB site, have also struggled. Investors pushed GGF’s stock price down more than 30 per cent on Wednesday on news that it would fund the acquisition of TPB and another file-sharing site by issuing new shares.

For copyright holders, targeting sites such as TPB makes sense – but only as part of a broader effort to nudge casual downloaders towards paid platforms. The industry’s lawsuits against individual file sharers have largely backfired, and technological barriers to file sharing may never deter the hardest of hardcore downloaders. But Apple’s successful iTunes store has shown that many customers are willing to pay for a good enough service. Music labels reckon a majority of illegal downloaders might stop if told to by their internet service provider – but only if they face being disconnected from internet service. Shame that Lord Carter, who wants a 70 per cent reduction in piracy by next year, did not take a firmer line on setting up a system for ISPs to share information about persistent offenders in last month’s Digital Britain report.

Last month’s deal between Virgin and Universal to offer ulimited monthly music downloads for a set fee, with Virgin cutting off access to users who share their music online, showed that labels are thinking creatively about market-based solutions to piracy. It falls to the government to ensure that such initiatives are backed up by a vigorous defence of copyright holders’ rights.

 

BACKGROUND NEWS

 

Global Gaming Factory, a Swedish software company, on Tuesday said it had agreed a $7.7m deal to buy The Pirate Bay, the free file-sharing website at the centre of a notorious court case.

The four men running the website were sentenced to a year in jail and fines of $3.6m in April after being sued by music and film companies for allowing people to illegally download copyrighted content.

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