Monday, May 6, 2002		On Software

Piracy has Hollywood on tenterhooks
David Rowan

ON the second floor of a nondescript office building in Victoria, central London, four young men tap intensely into keyboards as phrases such as ‘Panic Room’, ‘Resident Evil’ and ‘Spiderman’ flash up on their monitors. Hooked up to online file-swapping networks such as WinMX and Morpheus, they are searching for ‘hot downloads’, from films to computer games, that can be theirs’ free of charge at the click of a mouse.

But unlike the millions of the Internet users who exploit such networks each day to swap copyrighted material, Jimmy, Bill, Neil and Bruce are online detectives rather than pirates. From this office, among laptops and flashing network cables, they set powerful software agents crawling the Net’s murkier corners to detect, identify and remove files that should not be there.

Over 24 hours each day, their computers track the albums and movies that their rightful owners may have spent millions to create. For as illegal file-swapping becomes ever more popular, these technicians’ customers - from Metallica to Michael Jackson - are finding that only constant vigilance can afford them any control over their work.

The record industry may have won a legal victory against Napster last July but dozens of other file-swapping communities have emerged in its wake. The monitoring company that employs these investigators, NetPD, estimates that one such network, FastTrack-KaZaA, let people download 3.6 billion files during February alone, based on 4 billion separate search requests. And every day, another band, games developer or film director falls victim.

Newspapers began reviewing the new Oasis album last week as the record industry was lamenting the latest slump in music sales. And Oasis fans unwilling to wait for the July release of Heathen Chemistry found a far more immediate — and economical — way to enjoy tracks such as ‘Songbird’ and ‘She Is Love’. By logging on to any of dozens of song-swapping Web communities, they, and newspaper reviewers, could download pirated copies in less time than Liam Gallagher takes to sink another pint. No wonder the International Federation of the Phonographic Industry blamed the Internet piracy as it announced a worrying 5 per cent fall in global CD sales.

Two weeks ago a few fan sites began offering MP3 files of Oasis tracks apparently leaked when the album was being recorded. Then, as word spread, the album — which Sony says is not the final version — began circulating freely on file-swapping networks such as Morpheus and LimeWire. ‘When someone has downloaded it they might make it available via file sharing, and then someone else downloads it,’ explains Jollyon Benn, investigating the leak for the British Phonographic Industry. ‘It’s gone from being a fairly small problem on Monday to being completely out of control by Friday.’

Just how out of out of control online file swapping has become in recent months is revealed in an Observer investigation that shows how far the record, film and games industries are losing market share. The software that powers one such community, KaZaA, was downloaded 3.2 million times last week. As the Internet connections become faster and CD and DVD burners cheaper, it becomes ever easier for the amateur pirate to trade anything from a bootleg album to a high-quality Hollywood movie.

If you want to watch the film Blade II, for instance, you can now choose from around 1,25,000 people currently offering it as an Internet download. Ali G’s new film is available from 3,000 separate hosts. If you have a broadband Internet connection, even a high-quality DVD file of around 650 MB can be downloaded in a couple of hours, and then burned on to a disk.

That’s why record and film companies are now rushing to encrypt their CDs and DVDs with copy protection software that limits where and how they may be played. In Washington, a Bill introduced by Senator Fritz Hollings seeks to go further and make it illegal to make or sell any device for recording or playing digital content that does not reject unencrypted disks.

To discover the extent of the problem, The Observer asked NetPD to monitor the availability of current movies over a 24-hour period last week. If you wanted to watch Mission Impossible II, there were at least 83,000 unauthorised copies to choose from. If you preferred The Scorpion King, you could pick any of 96,000 files. From Ocean’s Eleven to The Lord of the Rings, almost all big recent Hollywood hits are available to anyone equipped with a fast enough internet connection. Over a four-week period, NetPD calculates that more than 28 million video files are exchanged through the major online networks. ‘Film has become a real problem,’ says Jim Stoddart, NetPD’s chairman. ‘Within the Gnutella community, requests for DVD files have recently overtaken those for music and even pornography. On Friday morning we found 65,613 presons active in a small corner of the Gnutella network.’

Music remains the most commonly swapped format. On Friday it took The Observer a minute to locate and download Oasis’s new single, ‘The Hindu Times’, using KaZaA, and a further 22 minutes to download the official video.

Using a machine that costs as little as $ 140, users can ‘burn’copy - audio or video files on to a blank disc. If the network involves no central computer - as is mostly the case nowadays - it is difficult for the lawyers representing the song’s legal owners to find a target to shut down. ‘You had a way to get at Napster because there was as an entity to litigate against,’ says Stoddart.

NetPD claims to have taken 52 million files offline last year, but that is the tip of the iceberg. In February, according to NetPD’s investigations, the album Hybrid Theory by the band Linkin Park, was downloaded more than 5.3 million times. Hybrid Theory was the top selling album last year in the USA, but what worries the record industry is that it sold only 4.8 million copies - the first time since 1966 that the national best seller had sold fewer than 5 million.

Sarah Roberts, communications manager for the British Phonographic Industry, says: ‘People think downloads don’t do anyone any harm but they forget that everyone from the session musicians to the producers gets their income from music sales. If the record companies don’t make a profit on the big name artists, they cannot re-invest and sign new artists. There will simply be less music to buy.’

As broadband connections grow, the film industry is set to be the next victim. Ken Jacobsen, director of the Motion Picture Association’s worldwide anti-piracy unit, says: ‘There is a substantial problem with the offering of illegal downloads of our members’ films, and we believe this problem will continue to grow. "As broadband deploys around the globe, we expect film piracy on the Internet will increase substantially." For online sleuths such as NetPD’s team, that can only be good for business. — ONS