Dutch Free-Music Site Closes

One by one, free music sites are disappearing. On January 19, Amsterdam-based KaZaA became the latest, caving in to threats of fines in excess of $40,000 per day.

KaZaA had been the defendant in a copyright infringement case brought against it last year by Buma-Stemra, a Dutch authors-and-artists collection agency that performs many of the same services in the Netherlands that BMI and ASCAP perform in the US. The Dutch peer-to-peer file-sharing service was found in violation of copyright law, and had been under court order to prevent "unauthorized downloading of copyrighted material" or face substantial fines for every day that it failed to comply.

KaZaA then requested a "clarification" of the ruling, scheduled to be heard in court on January 31. Fines of 45,000 euros per day for non-compliance were imposed, but were never collected, pending the outcome of the next court date. On January 16, its patience at an end, Buma-Stemra announced that it would move to collect the fines, backdated to January 17. Apparently feeling little confidence of winning in court, and threatened with fines that could bankrupt its principals, KaZaA agreed to close its file-sharing operation.

The Dutch music service had been a favorite among downloading fans since Napster shut down last year. Because its home base was in Europe, it was widely considered immune to pressure from organizations such as the Recording Industry Association of America which leaned so heavily on Napster.

KaZaA users believed that they were anonymous, but a January 4, 2002 report by Dow Jones Newswires indicated that the Web-surfing patterns of many visitors were tracked by software they unknowingly downloaded with the file-sharing programs. The software was hidden in a free online sweepstakes game called "ClickTillUWin," based on the Pennsylvania state lottery. "A few hundred thousand" KaZaA users were tracked until the ruse was discovered. Thousands of others using file-sharing services LimeWire and Grokster were also tracked. Users who played "ClickTillUWin" were not given the option of rejecting the tracking feature, nor was there any disclosure that it even existed, the report stated.