Using Law Suits to Stimulate Word of Mouth

I played golf this weekend with an attorney that represents the recording industry in its fight against the online piracy of music. As I listened to his story about their work, what was particularly interesting to me as a marketer was the fact that the legal battles he is fighting are not intended to generate financial restitution for the harmed industry players.

Quite the opposite…  In fact, the cases (even the victories) are a loss. The proceeds aren’t sufficient to pay for the legal expenses incurred in the fight.

So what’s the point?

The industry is hoping to stimulate buzz discouraging the piracy of music online.

Here’s how it works.

The industry employs a team of computer forensics people to somehow extract from sites like Kazaa.com (a well known peer-to-peer file sharing service) the email addresses of participating account holders along with some history of their transactions.

The attorneys then file what is called a “John Doe” law suit (against an unknown person) for stealing music.  This enables them to go to the ISP behind the email address and subpoena the identity of the account holder.

With the perpetrator’s identity (or the perpetrator’s parents’ identity) in hand, the attorneys file suit. The established penalty for this type of piracy is several hundred dollars per incident, and the average bill to the defendant winds up at $5-7,000. The cases are almost always found in favor of the industry, yet the awarded damages don’t cover the expenses of the case.

So here is the underlying premise.

As a parent, if I get socked for $5,000 out of the blue for something my kid has been doing online, I’m pretty likely to tell every other parent I know. Likewise, my kids who are watching this nightmare unfold are going to spread the word among their peers.

Lighten the wallets of enough parents in this way, and eventually the word will get out that music isn’t free.

It’s even starting to work among college students (with a twist). If you’re a student in college, as the school is handing your identity over for prosecution, you’re likely to get hit with an honor violation.  Stealing is after all a violation of the honor codes of pretty much every institution in the country.

I suppose it’s too early to say whether this will yield the intended result, but it will certainly be interesting to watch.  I have to admit, I’m surprised that I haven’t seen anything about this in the press.  (Or maybe I just haven’t noticed.) It seems like we should be seeing some of these parents popping up on the Today show to tell their story. If you have heard or seen anything in the press about this, please comment.

I wonder if the recording industry should divert a little of its clearly massive legal budget to PR to fuel the spread of this message.