Independent Perspective News

By ANDREW ROSS SORKIN

Some of the world's biggest record companies, facing rampant online piracy, are quietly financing the development and testing of software programs that would sabotage the computers and Internet connections of people who download pirated music, according to industry executives.

The record companies are exploring options on new countermeasures, which some experts say have varying degrees of legality, to deter online theft: from attacking personal Internet connections so as to slow or halt downloads of pirated music to overwhelming the distribution networks with potentially malicious programs that masquerade as music files.

The covert campaign, parts of which may never be carried out because they could be illegal under state and federal wiretap laws, is being developed and tested by a cadre of small technology companies, the executives said.

If employed, the new tactics would be the most aggressive effort yet taken by the recording industry to thwart music piracy, a problem that the IFPI, an industry group, estimates costs the industry $4.3 billion in sales worldwide annually. Until now, most of the industry's anti-piracy efforts have involved filing lawsuits against companies and individuals that distribute pirated music. Last week, four college students who had been sued by the industry settled the suits by agreeing to stop operating networks that swap music and pay $12,000 to $17,500 each.

The industry has also tried to frustrate pirates technologically by spreading copies of fake music files across file-sharing networks like KaZaA and Morpheus. This approach, called "spoofing," is considered legal but has had only mild success, analysts say, proving to be more of a nuisance than an effective deterrent. The new measures under development take a more extreme — and antagonistic — approach, according to executives who have been briefed on the software programs.

Interest among record executives in using some of these more aggressive programs has been piqued since a federal judge in Los Angeles ruled last month that StreamCast Networks, the company that offers Morpheus, and Grokster, another file-sharing service, were not guilty of copyright infringement. And last week, the record industry turned a "chat" feature in popular file-trading software programs to its benefit by sending out millions of messages telling people: "When you break the law, you risk legal penalties. There is a simple way to avoid that risk: DON'T STEAL MUSIC."

The deployment of this message through the file-sharing network, which the Recording Industry Association of America said is an education effort, appears to be legal. But other anti-piracy programs raise legal issues.

Since the law and the technology itself are new, the liabilities — criminal and civil — are not easily defined. But some tactics are clearly more problematic than others.

Among the more benign approaches being developed is one program, considered a Trojan horse rather than a virus, that simply redirects users to Web sites where they can legitimately buy the song they tried to download.

A more malicious program, dubbed "freeze," locks up a computer system for a certain duration — minutes or possibly even hours — risking the loss of data that was unsaved if the computer is restarted. It also displays a warning about downloading pirated music. Another program under development, called "silence," scans a computer's hard drive for pirated music files and attempts to delete them. One of the executives briefed on the silence program said that it did not work properly and was being reworked because it was deleting legitimate music files, too.

Other approaches that are being tested include launching an attack on personal Internet connections, often called "interdiction," to prevent a person from using a network while attempting to download pirated music or offer it to others.

"There are a lot of things you can do — some quite nasty," said Marc Morgenstern, the chief executive of Overpeer, a technology business that receives support from several large media companies. Mr. Morgenstern refused to identify his clients, citing confidentiality agreements with them. He also said that his company does not and will not deploy any programs that run afoul of the law. "Our philosophy is to make downloading pirated music a difficult and frustrating experience without crossing the line." And while he said "we develop stuff all the time," he was also quick to add that "at the end of the day, my clients are trying to develop relationships with these people." Overpeer, with 15 staff members, is the largest of about a dozen businesses founded to create counterpiracy methods.

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