Rapidshare Loses in Court – Must Proactively Remove Copyrighted Content

The long awaited court ruling has arrived and it may be very bad news for the ever-present content hosting website Rapidshare.

Note: This is an article I wrote that was published elsewhere first. It has been republished here for archival purposes

A court ruled recently in Germany that the website must not only take down content based on a legal claim, but proactively take down copyrighted content on it’s own.

It was only yesterday that the subject of file-hosting came up in a discussion about link sharing. A report from P2P-Blog pointed to a German court ruling (German) that said that not only does the file-hosting service has to comply with copyright complaints, but also check every file for copyright infringement. Rapidshare’s argument that it is already fighting copyright infringement appears to have not worked. From P2P-Blog:

The company also has to “proactively check content before publishing it” if there have been similar infringements in the past. Rapidshare has to log and check IP numbers of potential infringers as well, according to the court decision.

Rapidshare has been using a MD5 Hash filter to prevent the upload of previously removed material, and it told the court that it it has six employees working full time to remove infringing content. The Hamburg court however ruled that this was not sufficient because infringers would only have to change a few bytes of a file in order to circumvent the filter.

The court also ruled that Rapidshare cannot argue that it is impossible to stay in business if it would have to check every single file. “A business model that doesn’t use common methods of prevention cannot claim the protection of the law”, the decision reads.

The news may come as a major blow for some who use the service to share files since the site has been one of the most popular services of choice for hosting content and posting links in blogs and forums.

Critics say that the ruling makes no sense because password protected archives would be extremely hard to check in the first place.

Still, the market for file-hosting services is a wide open one with many other sites hoping to take over the top spot as the number one file-hosting service. So even if this move well and truly means the end of Rapidshare, it may be a click away from being replaced from other contenders like MegaUpload.

Others might point out that the ruling may have a chilling effect on web-based services hoping to start up in Germany given that if a service has to check everything for unauthorized content, how can there be any hope for privacy with that service? What about, going along the lines of RapidShare’s argument, additional cost overhead with the need to suddenly have a work-force to go through a service with a fine-toothed comb, looking for any possible misuse of its service by its users?

The lawsuit against RapidShare was filed by GEMA, a German copyright collective whose responsibilities include collecting sampling forms for re-use in derivative works.

Then there is the question of how much things will change in the first place. Many users post non-major record label content on the file-hosting websites. Independent content has built a reputation over the years for being less lawsuit-happy over copyrighted works online. Many of the producers behind the content generally have a more open approach mainly because piracy has been known to bring listeners to their content – something that would otherwise be difficult to impossible with the state of traditional radio and MTV these days.

At this point, it’s too early to tell what the fallout will be exactly, but the idea of logging IP addresses might ultimately be a deterrent for users whether or not they intend to use the service for sharing copyrighted works or not.

For those who think that copyright holders won a major victory here in the so-called war on piracy, there is the one tiny little note that suggests that knocking out one hosting company isn’t exactly the end of file-hosting altogether (link to Wikipedia’s list of file-hosting companies deemed “notable”)

In any event, it’s extremely easy to conclude that this latest legal blow serves no real purpose in the grand scheme of things.

Drew Wilson on Twitter: @icecube85 and Google+.

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