Grokster analysis from The Economist

Economist.com has a nice analysis of the Grokster ruling. The article summarizes:

But this blow against internet piracy may not be the magic bullet that the industry hopes will end its malaise. A Pew survey suggests that the swapping of music and film files doesn%u2019t just happen over file-sharing networks. Some 19% of downloads, involving about 7m individuals, now happen through someone else's iPod or MP3 player. Around 28% take place via email and instant messages. And quite apart from file-sharing, one in three CDs sold worldwide is pirated, according to the IFPI. Enforcement action to protect material under copyright has seen seizures of illegal CD-copying equipment double since 2003. Copyright theft through DVD piracy is equally worrying for the film industry, especially in countries like China, Indonesia and Mexico. Furthermore, legal downloading could cannibalise industry profits as fans are given the ability to pick and choose favourite tracks rather than having to buy whole albums. Indeed, advocates of P2P file-sharing insist that the option to sample for nothing an artist%u2019s oeuvre could work in the record company%u2019s favour as music buyers discover new favourites whose material they will subsequently pay for. Ultimately, many critics of the music business claim that its problems stem from an inability to produce a product that consumers want to buy, and that most illegal downloaders will flatly refuse to pay for unappetisingly packaged songs and films that they previously got for free.