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Consumer groups challenge Hollywood, labels

Supreme Court case to be followed by more peer-to-peer debates in Congress.

Consumer groups launched a full-scale assault on the entertainment industry's file-swapping legal strategy on Tuesday, with a study arguing that peer-to-peer networks are good for consumers.

The near-80 page paper (PDF file) discusses the benefits to consumers of online music distribution, how peer-to-peer technology can be used for political speech, and cites record labels' "anticompetitive" activities in the late 1990s as a way to explain consumer behavior.

Many of these issues have been raised in legal and lobbying circles before. But the unambiguous participation of the traditional consumers' associations in the file-swapping debates could give technology companies powerful allies when the issue comes back in front of Congress.

"We hope this will be a campaign that will...help move the debate out of the geekdom and lawyerdom where it has been stuck."
--Mark Cooper, research director, Consumer Federation of America

"Record companies and movie studios have tried to make this a debate about privacy and theft," said Mark Cooper, research director for the Consumer Federation of America, which led the study. "It is not. It is about progress and freedom of expression."

The consumer groups are among dozens of organizations and individuals that have emerged with file-swapping policy recommendations as the Supreme Court mulls the issue.

The nation's top court will hear the case focusing on the copyright liability of file-swapping software companies on March 29, with a decision expected in June.

Record companies, movie studios and songwriters, joined by the U.S. government, have argued that software companies that gain a "predominant" share of their business as a result of copyright infringement should be held legally liable for that activity.

Peer-to-peer software companies "Grokster and StreamCast are not innovators," David Israelite, chief executive officer of the National Music Publishers Association, said in a statement Tuesday, following the submissions of his group's final brief to the court. "They have appropriated technologies developed by others and put them to unlawful use in order to make a profit off infringement."

Grokster and StreamCast, joined by Intel and other technology companies, say their software has substantial noninfringing use, and they should not therefore be responsible for illegal uses of their products. Two lower federal courts have agreed.

Cooper said that the debate over the issue would almost certainly move to Congress again, no matter which way the court ruled. The consumer groups' action was the first step of a grassroots campaign to help mobilize people against the entertainment companies' lobbying, he said.

"The public must become aroused to balance (the companies') political power," Cooper said. "We hope this will be a campaign that will...help move the debate out of the geekdom and lawyerdom where it has been stuck."