Instant-messaging services that allow users to trade music, movie and television files over the Internet appear to be safe from the legal woes that have plagued other digital music and movie companies.
Microsoft, America Online and Yahoo now have added file-sharing enhancements to their instant-messenger applications that allow users to swap any digital files over centralized networks.
Other digital media companies -- most notably Aimster, which provides file-trading capabilities through instant messaging -- have faced long legal battles with the recording and motion picture industries over this issue. But these corporations, by virtue of their size and association with the recording industry, are unlikely to be sued by the major labels.
"In almost every case, you have an accumulation of well-financed companies -- media conglomerates -- ganging up on startups," said Whitney Broussard, an entertainment copyright lawyer with New York's Selverne, Mandlebaum & Mintz, LLP. "Legal arguments aside, these companies have a lot of muscle and they can often crush the little music startups. And maybe in the end, the music industry will be right about file trading, but larger companies can fight back. It's a lot riskier when you go down the legal road with those companies."
This trio of heavyweights' new services has been warmly received by the recording industry. The three -- along with RealNetworks and Napster -- have signed on to be distributors for two new subscription services set to launch later this year.
However, those deals don't allow users to share files over instant-messenger systems.
While the instant-messenger programs allow file trading, officials from both Microsoft and Yahoo said the Terms of Service forbid any illegal activity.
"Yahoo has a strong track record in protecting the rights of copyright holders," said a Yahoo spokeswoman. "While we do provide core communications capabilities to users, the sharing of copyrighted material is expressly against our Terms of Service. Yahoo clearly notifies all users that any type of infringement is prohibited before any sharing can be initiated."
The Recording Industry Association of America -- a trade association representing the music labels and the leading organization fighting copyright violations online -- had no comment about potential legal problems with the new services.
But other companies haven't gotten off so easily.
Aimster allows users to trade files with buddies through the AOL Instant Messenger service, although America Online didn't develop the system. Earlier this year, the company was drawn into a legal fight with the RIAA.
The intent of the Aimster network was to facilitate file-trading though, while messenger programs have largely been used as communication tools. That distinction could make all the legal difference.
"To me the instant-messaging systems sound exactly the same as Aimster, only the difference is how this was put together," Broussard said. "Aimster came with file sharing and IM built into in the same time. These other services started as IM, and came with file sharing. That might go to some form of non-infringing uses."
Over the past three years, eight lawsuits have been filed against a variety of Internet companies and hardware manufacturers that have attempted to profit from trading digital-entertainment files on the Internet.
Six companies -- Napster, Scour, Aimster, MusicCity, Grokster and Consumer Empowerment -- faced copyright infringement lawsuits for creating software applications that allowed users to trade media files with other users.
Consumer electronics manufactures Diamond Multimedia and SonicBlue were taken to court because their products could be used to transport and play pirated music and video files.
The same six companies have each been accused of illegally using copyrighted entertainment like movies, music and television shows.
Instant-messaging services allow one person to send a real-time message to somebody else. Applications like America Online's Instant Messenger (AIM), MSN Messenger and Yahoo Messenger allow users to create lists of "buddies," making it easier to see which friends are online.
Messaging offers a myriad of potential headaches for entertainment conglomerates hoping to curb Internet file sharing. The sheer number of messages being sent would make it difficult to track down users who might be violating copyright.
While Napster's network handled just under three billion files in one month at its height this year, AIM services one billion messages each day. Much of the service centers on short notes being sent between users, however, the new features make it much easier to swap files.
Both Yahoo and AIM offer users the option to open up their hard drive to their friends, but MSN Messenger requires users to manually send files to individuals. Once the file-trading option is turned on, friends who are signed on to a messenger program can search for any files on their buddies' hard drives.
Currently, the system only works with specific programs. So a user signed on to AIM wouldn't be able to open their hard drive to somebody on Yahoo Messenger.
Unlike Napster and other file-trading networks that operated primarily as a network to trade music files for free, at least one record label found a way to harness the power of instant-messaging peer networks.
To promote the band Radiohead, EMI created a buddy list with Aimster -- a file-trading system that works with AOL's AIM -- that allowed people to share the upcoming single. Over 37,000 users signed up for the promotion, and the album debuted at No. 1 several weeks later, according to Forrester Research.
Yahoo's newly upgraded system also offers IMVironments, chat window backgrounds that feature Dilbert cartoons and band promotional pages. With the beta upgrade, Yahoo messenger users can download a new song by Garbage.
Instant Messages Go Multimedia
Aimster Up, Napster Down for Now
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