Twelve Year-Olds, Grandmothers, and Other Good Targets for the Recording Industry's File Sharing Litigation

Abstract:     
This article focuses on the narrow issue of the rationality of end user litigation by the recording industry against individual file-sharers. The illogic of the recording industry's present strategy has been argued by a number of commentators who also believe the practice to be undesirable from a broader social perspective.

The purpose of this article is to disentangle these conflicting perspectives and to answer the simple question: does end user litigation make sense for the recording industry? The rational choice model of consumer file sharing applied in this article indicates that, rather than being "commercial suicide," end user litigation actually makes sense for the recording industry.

The advantage of applying a traditional cost benefit analysis of consumer file sharing is that allows us to contextualize the predictions of normative and technological backlash that seem so popular. While the theoretical possibility of either of these reactions remains, there is no current evidence to suggest that they will overwhelm the increased value of expected legal sanctions engineered by the recording industry's consumer litigation.

The cost benefit model suggests that rational consumers should be just as sensitive to changes in the expected cost of legal sanctions as any other product feature associated with the music they acquire.

Furthermore, rather than focusing their efforts on the very worst copyright offenders, the recording industry's optimal strategy in relation to end user litigation is to target the most sympathetic defendants along with a broad spectrum of file sharers. Targeting high volume up-loaders sounds like a safe course of action at first, but as this article explains, this is an illusory comfort. It makes much more sense for the recording industry to target more marginal file sharers because they are more likely to be persuaded to stop file trading and start buying music.

Keywords: Copyright, Peer-to-peer, File sharing, End User Litigation

JEL Classifications: K42, O34

Accepted Paper Series