The copyright climate online has been shifting for some time and that change has caught up Sharman Networks, the makers of the popular Kazaa file sharing software. Today they announced that they have settled all of the ongoing litigation against them, both domestic and international, and are turning themselves into a legitimate service.
While the terms of the settlement are sketchy, the Recording Industry Association of America (RIAA), one of the organizations suing Sharman Networks, said that the settlement involved a "substantial sum" of money as well as filtering technology on the Kazaa network to ensure that copyrighted content can not be shared.
This settlement is not surprising, especially following last year's famous Grokster V. MGM ruling. In that ruling, the supreme court found that file sharing companies, as well as distributors of other technologies that "induce" copyright infringement, could be held liable for the actions of their users.
Nonetheless, it is a sign that the Grokster ruling has stuck and that there is no easy way around it. Though some felt that Grokster could be averted by simply changing the way one promotes a service, that is looking less and less likely every day.
For content holders and bloggers, this is something of a mixed blessing. While the ruling and its most recent fall out are blows to all file sharing, including legal sharing, it does strengthen a potential avenue of attack against sploggers and scrapers, the ability to go after the software makers that enable them to steal.
This is a risky, controversial and potentially powerful technique that could put a severe dent in the scraping industry. It will also be the topic of tomorrow's update.
Stay tuned for more details.