Two panels urged senators at a hearing chaired by U.S. Sen. Arlen Specter that the Grokster decision doesn’t warrant immediate legislative action. Panelists included Marybeth Peters, register of copyrights; Cary Sherman, president, RIAA; Ali Aydar, COO, Snocap; Gary Shapiro, president & CEO, CEA; and Sam Yagan, president, MetaMachine, Inc. (eDonkey). Peters said her preference would be to see how courts deal with the decision and let that inform any legislative fix. Sherman attributed the rise in the number of colleges and universities signing legit online music distribution deals to the decision.
The most significant statement may have made by eDonkey’s Yagin, who illustrated why the record companies are so pleased with the decision despite what some see as a lack of clarity: “”Because we cannot afford to fight a lawsuit – even one we think we would win – we have instead prepared to convert eDonkey’s user base to an online content retailer operating in a ‘closed’ P2P environment.” The company is negotiating a settlement with the RIAA and the switch to a closed system would be part of that.
Derek Slater, who covered FMC for us, suggests reading the http://judiciary.senate.gov/hearing.cfm?id=1624estimony.
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