new cfo, page-13

kazaa blocked Kazaa blocks, warns Aussie users
By Iain Ferguson, ZDNet Australia
06 December 2005 04:19 PM


Sharman Networks has closed down new Australian users' access to the Web
site from which the Kazaa Media Desktop (KMD) can be downloaded.

ZDNet Australia understands the shutdown -- undertaken to comply with
Federal Court orders -- took effect from just before midnight AEDT. In
addition, while users with an Australian IP address who have already
downloaded the KMD can continue to use the software, Sharman is issuing
them with warnings not to do so.

However, Australia's peak music industry body, the Australian Record
Industry Association, lashed the move as failing to achieve compliance
with the orders and said the operators of Kazaa had no choice but to
shut
down.

ARIA chief executive, Stephen Peach said today: "Sharman has thumbed its
nose at the court.

"They were given a chance to do the right thing and they’ve ruined it,"
he
said. "They cannot be trusted to even take the simplest steps towards
complying with the court’s orders and again have shown they intend to do
nothing about the illegal activities occurring on a massive scale on
their
system".

However, new users who attempt to access the Kazaa Web site from
Australia
are directed to a notice stating "The download of the Kazaa Media
Desktop
by users in Australia is not permitted," while existing users who launch
their application are greeted with the following warning: "ATTENTION
USERS
IN AUSTRALIA: To comply with orders of the Federal Court of Australia,
pending an appeal in the (sic) February 2006, use of the Kazaa Media
Desktop is not permitted by persons in Australia.

"If you are in Australia, you must not download or use the Kazaa Media
Desktop".

The KMD is a peer-to-peer service used largely for the sharing of music
files - whether copyright or unrestricted -- within a community of
users.

It is understood the KMD Web site will remain inaccessible to Australian
users at least until at a decision is made in the appeal by Sharman and
associated parties against the orders. The appeal is due to be heard
from
20 February next year.

On 5 September, after an 18-month battle, the Court found in favour of
about 30 music labels by ruling that Sharman and associated parties had
authorised users of Kazaa to breach copyright.

As a result, Sharman was ordered to install a keyword filtering system
in
Kazaa by 5 November that would prevent copyright-infringing behaviour by
users in the leadup to the appeal. The court then granted a further
extension until 5 December.

However, in a technical conference between Sharman and the music
industry
between 10 October and 24 November the parties discussed the use of more
effective measures than keyword filtering, with so-called "audio
fingerprinting" software raised as an option. It is understood that the
music industry opted not to attend a second proposed conference. On 24
November, the Federal Court ordered Sharman to release a new version of
the KMD including a non-optional filter that excluded from search
results
3,000 keywords -- including 'Madonna' and 'Eminem' -- and implement
dialogue boxes on the Kazaa Web site pressuring users to obtain the
updated release.

If the Sharman parties are successful in their appeal, the site is
expected to be reopened sometime after with audio fingerprinting -- most
likely the Audible Magic software -- employed to block illegal behaviour
on the peer-to-peer network.

However, ARIA issued a statement saying Sharman's actions yesterday
amounted to a refusal to apply the keyword filter to its software and
that
the record companies would "return to court to enforce the orders of the
copyright judgement". ARIA included a quote by Federal Court Justice
Murray Wilcox from a 10 October hearing into establishing the keyword
filtering saying "...if that doesn't happen...they will get no sympathy
from me and there will not be an extension beyond 5 December, even if
that
means closing down the Kazaa system".

A Sharman Networks spokesperson said "All activity that could be deemed
as
authorising has stopped so as to comply with the court orders, pending
the
imminent appeal in February.

"The Australian record companies have achieved their aim to stop the
further distribution of Kazaa in Australia until an appeal court decides
whether these orders should stand or not.

"The Australian record company case is funded by their international
associations and parent companies, so we understand their disappointment
at the localised effect of this ruling," the spokesperson said.