Each case involves a distinct kind of Internet service. They are putting the fear of significant litigation costs in front of innovators. In a July 3 legal filing opposing an RIAA request for a preliminary injunction against Napster, attorneys David Boies and Laurence Pulgram allege the music companies are using the monopolistic power of their copyrights to squash Napster as it now exists. The filing alleges that the labels want to replace Napster with their own distribution systems, or force Napster to relaunch as a storefront for their content.
Industry says other factors at work.
Doug Camplejohn, president and CEO of music storage service myplay Inc. does not believe that the majors are trying to control or slow down the market with their lawsuits. He states that investment in online music companies has been slowed more by recent stock devaluation and market volatility than by a fear of litigation. If the lawsuits have had any effect, Camplejohn says, it is that venture capital firms now regularly conduct legal reviews of Internet music companies before deciding to invest in them. The 'best' thing you can say about the lawsuits is that they sounded the wake-up call to anyone at the labels that thought the market wasn't ready, and that they could ignore ecommerce. The search for precedents.