By Andy Sullivan in Wired:
"The U.S. Supreme Court on Friday agreed to consider whether Internet file-trading networks should be held responsible when their users copy music, movies and other protected works without permission.
Online networks like Grokster and Morpheus allow millions of computer users to copy music and movies for free from each others' hard drives. Recording labels and movie studios say that cuts into their sales.
But the Ninth Circuit Court of Appeals ruled in August that peer-to-peer networks cannot be held liable for copyright infringement because, like a videocassette recorder, they can be used for legitimate purposes as well.
Even as record labels challenge the appeals court's decision, they are tentatively embracing peer-to-peer networks as a way to cut distribution costs and reach out to listeners.
By the time the Supreme Court hears the case next spring, all four major labels — Vivendi Universal, EMI Group Plc , Sony BMG Music Entertainment <6758.T> and privately held Warner Music — could be distributing their songs over a new generation of peer-to-peer networks like Snocap and Mashboxx that promise to collect payment for songs."
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