Music piracy 'good for rock stars', court told

An Eircom official told colleagues they should think of music piracy as ‘sharing’ and “helping the health and good living of rich cocaine sniffing rock stars by leaving them with less free money to spend on sex and drugs”, the High Court heard today.

Michael McDowell SC, for four record companies who claim Eircom should be compelled by the court to take measures to prevent the use of its networks for the illegal free downloading of music, said such music piracy is costing record companies here up to €14 million a year.

The Irish recorded music industry is in deep financial crisis and "almost on its knees" because of piracy but Eircom's attitude was that was not its problem, counsel said.

He read an email from Eircom's head of Internet Protocol, Denis Curran, of January 2001, which suggested "the MP3 piracy issue" be on the agenda of the next management meeting.

"We need to reach a decision on how we are going to handle this," the email said. "PS 'piracy' is a loaded term. Could we say 'sharing'- 'piracy' implies there's something wrong with it.
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"Think of it as helping the health and good living of rich cocaine sniffing rock stars by leaving them with less free money to spend on sex and drugs."

Mr McDowell said Eircom was also this week advertising its broadband packages on a website, Pirate Bay, which was being prosecuted in Sweden over alleged large scale illegal music piracy.

Eircom was also offering family packages on a broadband promotional site which the company said would allow for the downloading of some 5,000 songs a month, counsel said. Eircom, he argued, could not be contemplating that young people would be paying 99 cent per song as provided for on legal music downloading sites

The court should consider all these matters when considering Eircom's defence it is just a "mere conduit" for the downloading of music, he said. Eircom had complained the record companies had singled it out for this action but it had a 40 per cent share of the market for broadband internet services here and, if the companies won against it, they would move against other internet service providers.

Mr McDowell was opening the unprecedented action by the four record companies which is being heard by Mr Justice Peter Charleton in the Commercial Court and is listed to last four weeks.

The case is the first here aimed at internet service providers, rather than individual illegal downloaders, and reflects the concern of the music industry about the scale and cost of illegal downloading. The court previously heard some 20 billion music files were illegally downloaded worldwide in 2006 alone and the companies say the advent of peer to peer technology had effectively created a global repository of illegally downloaded music and films.

The proceedings have been brought by EMI Records (Ireland) Ltd, Sony BMG Music Entertainment (Ireland) Ltd, Universal Music (Ireland) Ltd and Warner Music (Ireland) Ltd. They want court orders — under the Copyright and Related Rights Acts 2000 —restraining Eircom from infringing copyright in the sound recordings owned by, or exclusively licensed to them, by making available (through Eircom's internet service facilities) copies of those recordings to the public without the companies' consent.

Willie Kavanagh, managing director of EMI Ireland and chairman of the Irish Recorded Music Association (IRMA), has said illegal downloading and other factors are causing "a dramatic and accelerating decline" in income in the Irish music industry with total sound recordings sales falling from €146 million in 2001 to €102 million in 2007.

Eircom denies the claims and argues the record companies have established no cause of action against it.

Yesterday, Mr McDowell said the four companies between them are the exclusive licensees of up to 90 per cent of sound recorded music within the State. They estimated illegal downloading was costing the Irish music industry some €13.8 millionannually and, given Eircom's 40 per cent share of the market, its failure to tackle piracy was costing them between€4 and €5 million a year.

The court heard the companies would be relying on various EU Directives and Irish regulations relating to intellectual property rights and also on the property right provisions of the Constitution. Mr McDowell argued the EU provisions make clear the
courts of the member states are entitled to grant injunctions against Internet Service Providers such as Eircom.

His side would argue, while making a service available was not an infringement of copyright, an ISP, once notified by a copyright owner its network was being used to infringe copyright, had to take steps to "remove" the infringing material.

Because of illegal downloading, the remuneration now going to recorded music had been reduced to "a trickle" with a very severe knock-on effect. Concerts and live performances were now the only source of income and records had lost their value almost completely.

The record companies tried to tackle the problem initially by appealing on a moral basis to the Irish public not to illegally download on grounds this constituted theft and there was a legal alternative, counsel said. Young people between the ages of 10 and 25 were particularly appealed to but the problem was it was easier and more convenient to download music illegally than legally and an entire generation had been "corrupted". This strategy had virtually no effect.

The companies then pursued legal actions against individual illegal downloaders but this strategy also failed, counsel outlined. Legal moves against individuals had cost the companies some €600,000 and secured compensation of only €70,000.

The companies had then sought to have Eircom assist them in tackling illegal downloading but Eircom would not get involved. It was only then this legal action was taken, counsel said. The companies were not "trigger happy" but were driven to this.