Kazaa is earning the right to reinvent itself. But it will cost them--more than $115 million in penalties to music and movie companies. On Thursday, parent Sharman Networks announced its intention to
"go straight" by redesigning its file-sharing program to block customers who download copyrighted music and movies. That's obviously a big departure from where the company was a few years ago,
enabling consumers to share whatever files they pleased over its network. Kazaa will now license entertainment for a price--ending one of the longest, most highly profiled Internet copyright disputes
of the modern era. Sharman has agreed to "use all reasonable means" to discourage online piracy, which means implementing anti-piracy software into its file-sharing service. Like Napster, Kazaa's time
has come to an end "years after [its] cultural relevance has waned," says Eric Garland, CEO of BigChampagne Online Media Measurement, an Internet entertainment research firm. The Recording Industry
Association of America and the Motion Picture Association of America will share the $115 million, with the majority going to the RIAA. Music executives say the reward will merely help offset the cost
of fighting online piracy.
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