There Wasn't Another Limewire. And This Isn't 'Whack-a-Mole' Anymore...

Sunday, April 15, 2012
by paul

This isn't just how major labels are thinking these days; it's Hollywood as well. Because the thought process behind MegaUpload is actually quite similar to that of Limewire. That is, don't just shut these services down, but burn the village, hang the founders, make them pay. Bankrupt them, put them in jail.

And, most importantly, discourage future entrepreneurs and investors from supporting similar start-ups. In other words, an extreme, kill-em-all enforcement strategy designed to move beyond 'whack-a-mole' problems of the past.

This is what major label insiders keep telling us, and they feel like the stepped-up strategy is working. Just witness how many MegaUpload competitors changed their policies just days after the raid. Or, just simply packed up their lockers and voluntarily shut down. They were freaked out and they're still freaked out; the massive FBI raids worked. All of this is encouraging media companies to intensify and expand this strategy.

(photo: the final moments of Limewire, captured by an employee and sent to Digital Music News.)

Which brings us to Limewire, served with a court-ordered shutdown in late-2010. By mid-2011, the penalties included personal liability for founder Mark Gorton, but not enough for the majors. "The labels really wanted to punish Gorton, they wanted to drag his body in the streets and say 'look, this guy paid for this.' But they feel they didn't really finish the job," one now-departed, high-ranking major label recently told Digital Music News.

The funny thing is that unlike the decentralized monstrosities that emerged after the shutdown of Napster, there wasn't really 'another' Limewire. Sure, file-swapping is alive-and-well on BitTorrent and even happening on older and cloned Limewire apps, but a large amount of music fans simply shifted towards on-demand services like Spotify, Grooveshark, and YouTube. It's a complicated soup that involves rapidly-shifting technologies, but it's not so complicated according arguments now being made out loud by the major labels.

Call it revisionist history, call it whatever you want, but the RIAA started studying the impact on consumers the minute Limewire was shut down. That involved a focus group of music fans and usage data from Nielsen Netview.

"The analysis showed that the vast majority (almost 90%) of those who used Limewire in September 2010 did not use it in September 2011. Further, about 65% of those who stopped using Limewire did not use or visit any of the applications and sites in the panel that primarily provide illegal downloads. Broadening that to total audience with the regular panel weightings, of the 14 million US Limewire users represented by the group in September 2010, 9.5 million did not use any of the unauthorized sites monitored one year later."

Statement by Joshua P. Friedlander, Vice President, Strategic Data Analysis, RIAA, April 12th, 2012.

(The study involved roughly 2,800 panelists, and the survey also covered a range of competing services (legal and paid) like iTunes, Spotify, Pandora, MegaUpload, and the Pirate Bay (full blog post here)).

This is how the major labels are now thinking.

Comments Closed

Comments (8)

@David_Matthew_ Monday, April 16, 2012

Major labels & Hollywood going after the big pirates, while the rest quake in their boots.

JacksonL Monday, April 16, 2012

How can you leave HADOPI and the ISP warnings out of this? THIS more than anything is deterring people even if there is NO punitive action.

JL

@Ben_Cline_Esq Monday, April 16, 2012

Youtube and Spotify would have killed Limewire. To claim victory the RIAA is confusing the inevitable with their actions.

musicservices4less Monday, April 16, 2012

Ben,

You are right but missing the point. Illegal downloading will never end on an individual basis. It took a total PR disaster for the entertainment industry to realize that it actually is up against the very same people they are having drinks and dinner with i.e. the tech venture capitalists who support these cockamamie new services that have no, or at best, questionable rational/legal business plans. Go after the big players only. With the amount of file sharing going on that is in violation of the law, there has to be big players. Next on the list to be stopped (but not put out of business of course) is Google search and its division, YouTube. It will take some time and will not look like what happened to MegaUpload but it will happen unless the law is changed. Sadly however, the only thing that will put the entertainment industry back on its feet is a full format change ala tape to CDs.

jw Monday, April 16, 2012

If Limewire was the biggest fish in the sea at that point in time, & the RIAA supposedly took 2/3 of them out of the game, where did all of the new file sharers come from? Isn't file sharing more rampant than it's ever been? The math just doesn't add up, unless the vast majority of users had already moved onto bit torrenting & megaupload-type services by that time.

Maybe the focus group participants were just too afraid to admit to the RIAA that they are currently using a service to download music illegally (supposing these are even legitimate statistics to begin with).

Visitor Monday, April 16, 2012

Being an entrepreneur doesn't mean you need the ability to freely host other peoples work. I mean for fucks sake, you can do things legally or illegally, and the latter should not be praised.

BryanInMusic Monday, April 16, 2012

I'd be interested to see a poll asking how many current users of streaming services (Spotify, Rdio, etc.) used platforms like Limewire in the past. I'm thinking quite a lot of people who used to download illegally are now just streaming music for free. Thoughts?

money talks Monday, April 16, 2012

Notice how all these gangs have expensive offices with the latest Mac models e.t.c.

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