KaZaA BV operates exactly the type of service which the music and movie industries feared most in the wake of Napster. With Napster, users of the service had to visit the Napster site to find and access the music files which were available on the computers of other Napster users. Its opponents knew that by getting a court order to shut down Napster’s server, the swapping could not continue. Unlike Napster, KaZaA and similar services are decentralised, meaning that there is no server which can be shut down to stop them. They also enable the sharing of various file types, not just MP3 files.
Once users have downloaded the free peer-to-peer (P2P) software from the KaZaA site, they do not need KaZaA to continue operating. Accordingly, the company has argued that it has no idea who its users are or what files they are swapping. The software has to date been downloaded 20 million times.
The US music and movie industries' representatives, the RIAA and MPAA, do not believe that the users are untraceable. The RIAA has sued KaZaA in the US in a lawsuit which also targets similar services, Grokster and MusicCity. All three services offer users the same P2P software from a Dutch company called FastTrack. The RIAA believes that the software does maintain a user database.
The owner of both KaZaA and FastTrack is Niklas Zennstrom of Sweden. The popularity of his software is evidenced by its use on the KaZaa, Grokster and MusicCity services to swap 1.81 billion files in October alone, according to research firm Webnoize.
The case against KaZaA was brought by Holland’s music publishing body, Buma/Stemra. Perhaps acknowledging the difficulty of shutting down the network, the Dutch judge on Thursday also ordered KaZaA to enter into licensing negotiations with Buma/Stemra. KaZaA’s lawyer, Christiaan Alberdingk Thijm, told news agency Reuters that he hoped the negotiations would render the main part of the verdict irrelevant. He also considers it ambiguous. He told the Wall Street Journal:
"The ruling is not clear. We don't know whether we have to visit our users to erase our software from their hard disks or whether we have to post a warning on our web site. Besides, we don't know if this ruling is world-wide or only applies to the Netherlands."
If negotiations fail and file swapping is not halted by 13th December, KaZaA faces the daily fines up to a maximum of two million Guilders (£570,000).