Thu, Nov 11, 2004 - Page 10 News List

P2P companies, record labels lock horns again

By Jessie Ho  /  STAFF REPORTER

The legal battle between record labels and peer-to-peer (P2P) file-sharing companies seems to be snowballing, as groups of copyright holders yesterday alleged that the nation's largest P2P operator was again caught infringing on copyrights of their works.

According to an indictment issued by Changhua District Court in September, kuro.com.tw (飛行網), Taiwan's biggest P2P operator, was accused of hiring four employees in a Taichung company it set up in February 2002 to transfer music files from CDs and put them on Kuro's site for sharing.

The indictment also said that company employees sold pirated CDs by reproducing those files to blank CDs.

"They [Kuro] provided music files for downloading, which is an obvious copyright infringement," said Robin Lee (李瑞斌), secretary-general of the International Feder-ation of the Phonographic Industry (IFPI) in Taiwan, which represents 11 record labels here.

Lee, along with representatives from the Music Publishers Association (音樂著作權代理人協會) and Music Copyright Intermediary Society of Chinese Taipei (中華音樂著作權仲介協會), made the remarks while showing the indictment to the press yesterday.

The latest case has been merged with a lawsuit in which Kuro and its smaller rival, Ezpeer.com.tw, were indicted last December for alleged violations of the Copyright Law (著作權法). The suit was also filed by IFPI. The case is still pending at the Taipei District Court.

Kuro spokesman Eric Yang (楊智謀) denied committing any wrong-doing, saying they merely contracted the Taichung company to handle Kuro's online CD sales.

"We have absolutely not provided any files for sharing," Yang said in a telephone interview.

With as many as 500,000 mem-bers swapping music files via its Web site at a monthly charge of NT$99, Kuro has been blamed for undermining the music industry.

Last week, Kuro gained authorization to distribute songs released by an independent recording company, Sounds Good Background Music (上蠱互動), which Yang said could cost Kuro NT$1 million per month.

He said the move showed that Kuro is willing to work with the music industry to provide customer-oriented products to the market.

IFPI and its members should consider establishing a business model that caters to music fans' needs, since file-sharing has become a major tool for consumers to obtain music, he said.

Like Sony BMG Music Entertainment that is mulling establishing a new venture with P2P software distributor Grokster in the US, Yang said IFPI should consider adopting the model to benefit three parties — record labels, P2P

operators and consumers.

IFPI and two other groups, however, urged Kuro to obtain a further 500,000 song titles from their members to distribute legally on their site.

IFPI in May proposed a civil claim of NT$431 million against Kuro for infringing on its copyrights. Lee said the institution will soon propose higher compensation over the latest indictment.

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