Patry and Sheffner Debate Huge Jury Awards in RIAA Lawsuits

There is an interesting debate going on right now between William Patry and Ben Sheffner at the Moral Panics and the Copyright Wars blog. It centres on the verdicts in two recent high-profile p2p trafficking cases launched by RIAA against regular people (Jammie Thomas-Rasset and Joel Tenenbaum). In Thomas-Rasset’s case, a jury awarded damages against her totalling $1.92 million USD, or $80,000 per song that she stole. For Tenenbaum, a jury awarded a similarly crippling $675,000, or $22,500 per song.  Both these figures dwarf the minimum $750 per song prescribed by law. The issue Patry and Sheffner discuss in a point-counterpoint format is: Just what do these huge damage awards indicate? Are they proof that the greater public, away from the ultra-opinionated echo-chamber that is the internet, hates file-sharing as much as the RIAA? Or, are they unique cases that illustrate the failings of the jury system and highlight the missteps of the recording industry?

The position taken by Sheffner basically seems to be that the juries in the Thomas-Rasset and Tenenbaum cases were being reasonable and that they awarded damages within the spirit of the law. Moreover, Sheffner argues that most people placed in that jury booth would have behaved in a similar fashion. There is a tendency to overestimate the preponderance of the anti-copyright and anti-RIAA movement if you just look at the internet and the blogosphere. With politically charged issues like this the internet tends to act as a great big echo-chamber, accentuating a vocal minority while ignoring the silent and uninterested minority. Sheffner argues that on the whole most people (along with the US congress) think that file sharing is stealing and those who choose to download — as Thomas-Rasset and Tenenbaum incontrovertibly did — should be punished.

While Patry acknowledges that the RIAA does have the right to enforce its copyrights by suing consumers directly, he argues it is a desperate and hurtful attempt to enforce an outmoded business model. The recording industry has cultivated an extremely unfavourable public image by unnecessarily resisting all technological innovation. While the RIAA sued Napster, MP3.com and similar services it failed to introduce any sort of viable, legal alternative for consumers. It took Apple with the iTunes store to create something resembling a viable digital download service. Patry argues that with these lawsuits the music business has basically attempted to excuse its own failings by blaming its own customers.

Patry and Sheffner go on to discuss file sharing, the recording industry, and copyright in some detail. It’s a highly recommended read; make sure to check out whole series of posts from the past month or so (you can get to them using the sidebar on the right on Patry’s blog).

An interesting question raised by the RIAA lawsuits is: Why would anyone buy an mp3 when they can download it for free from a file sharing site? The music industry is hurting from declining CD sales, but legitimate digital downloads are on the rise. Despite the huge damages awarded in the aforementioned American cases, illegal file-sharing remains a pretty easy and risk-free activity. This is particularly the case in Canada where ISPs are not compelled to reveal subscriber information for non-criminal matters. It’s an important issue that the publishing industries need to figure out moving forward – they need to identify what exactly it is that’s compelling consumers to buy mp3s when there’s little-to-no chance of getting caught stealing. I don’t think it’s as simple as consumers having a healthy respect for the work that goes into making and distributing creative works, nor is it a fear of $2 million law suits.

One factor is almost certainly the user experience. While file-sharing isn’t hard, it’s also not particularly easy, especially for those who are not technologically inclined. This is where Apple hit the nail on the head and where the record labels have failed with their own services. The Apple iTunes store is a pretty impressive thing. It has a huge catalogue of songs spanning all the major labels and an impressive array of indie ones, too. It’s accessible from any PC, iPhone, or iPod touch, it’s fast, it looks good, it sounds good, and it’s tightly integrated with all of the iPod hardware. It took Apple a few iterations to get there, but it’s there now. The recording industry’s comparable stores MusicNet and Press [P]lay, on the other hand, were so useless they were almost doomed to fail from the start. Each service only had one major label’s catalogue of songs and the files were loaded with DRM. What Apple has done is create a legitimate downloading service that is truly easier and better to use than illegal downloading. The process of buying from the iTunes store is so much nicer than going to shady file sharing sites that people are willing to pay a premium for it.

The other half of the equation is that people have a general aversion to breaking the law. People do actually know that copyright exists and that illegal downloading deprives creators of creative works of income. Though the Thomas-Rassett and Tenenbaum cases have done little to scare people away from downloading, they do hammer home the point that it’s against the law and (in a nutshell) wrong. This is not so much a legal issue as it is a social/psychological factor whereby regular people don’t want to deal with the guilt and anxiety that come with breaking society’s norms.

The combined factors of a superior user experience and having a legal alternative are enough, as it turns out, to get people to pay up. When Napster first came out in 1999 there were no viable legal alternatives for acquiring mp3s and most users didn’t stop to consider that they were infringing copyright. With the arrival of services like the iTunes store however there are finally viable alternatives to file sharing. How much exactly consumers are willing to pay for a slick user experience and avoiding the guilt of breaking the law is really a business question at this point, but it’s good news for the publishing industries that they are.