BBC News Online: Business

Online services liable for bootlegs

AOL Germany has said it will appeal, but if the verdict stands it could have dramatic consequences for internet service providers across Europe.

German software firm HitBit had sued AOL for damages of 100,000 Deutschmarks after discovering that Midi music files its staff had composed were circulating in AOL's "Musik-Soundforum".

AOL said it was not responsible for the postings, and pointed to the fact that it used "scouts" to trawl the section for copyright violations.

The firm's spokesman Frank Sarfeld said that "AOL can't monitor every action its members make".

However, the court found that AOL should have done more to police the content on its web site.

The trial was closely watched by the music industry. Trade organisations say that the industry uses hundreds of millions of Deutschmarks every year through piracy on the internet.

A lawyer for HitBit said: "The ruling is a milestone for all producers of copyright-protected material such as music, film and text."

Germany's music industry has asked the country's internet service prociders to install RPS filter software (Rights Protection System) on their serves.

This would allow the industry to block access to web sites both in Germany and outside the country that have been found to carry pirated music.

Critics argue that this would open the door to censorship and industry analysts doubt whether service provider can be persuaded to carry the costs.