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The entertainment industry and technology companies have been warring for years over the dazzling ability of computers and the Internet to copy and transmit music and movies.
A crucial battle ended this week with a ruling by America’s Supreme Court in favour of copyright holder and against two companies that distribute peer-to-peer （P2P）software，which lets users share files online with others.The court’s decision，though ostensibly a victory for content providers，is.nevertheless unlikely to stamp out file sharing—much of which will continue from outside America—or stop the technological innovation that is threatening the current business models of media firms.
The court was asked to decide whether two firms，Grokster and StreamCast，were liable for copyright infringement by their customers.Two lower courts had said that the firms were not liable，citing a 1984ruling in favour of Sony’s Betamax video recorder.This held that a technology firm is immune from liability so long as the device concerned is ’capable of substantial noninfringing uses’.The court did not reinterpret the 1984decision in light of the Internet.Instead the justices ruled that the case raised a far narrower issue：whether Grokster and StreamCast induced users to violate copyrights and chose not to take the simpie steps available to prevent it.Such behaviour would make the firms clearly liable for copyright infringement and end their immunity，even under the Betamax standard.The court reasoned that there were sufficient grounds to believe that inducement occurred，and sent the case back to lower courts for trial.
Although the Grokster decision will probably not squelch innovation as much as many tech firms fear，it should certainly make IT and electronics firms more cautious about how they market their products—and quite right，too.But the Supreme Court’s narrow ruling makes this unlikely—in deed，the justices noted the technology’s widespread legitimate use.Yet their decision will surely embolden the entertainment industry to pursue in court any firms that they can claim knowingly allow in fringement；This could kill off some small innovative start-ups.On the other hand，the ruling could also provide legal cover for tech firms with the wit to plaster their products with warnings not to violate the law.
But judged from a long-term perspective，this week’s victory for copyright holders seems likely to prove a Pyrrhic one.The Internet and file sharing are disruptive technologies that give consumers vastly more ability to use all sorts of media content，copyrighted or not.Surely entertainment firms must devise ways to use this technology to sell their wares that will also allow copyright to be protected.
So long as technology continues to evolve in ways that enable legitimate content sharing，piracy will also probably continue to some degree.Happily，in this case the piracy seems to have prompted content firms to compete by offering better fee-based services.The challenge for content providers is to use new technology to create value for customers，and to make those who use content illegally feel bad about it.