The music industry's struggle with Napster proved that consumers hungry for digital information wouldn't wait for publishers holding the copyright keys to bring electronic content to them.
Now, in a separate electronic-age copyright dispute, the Supreme Court ruled Monday that free-lance writers can control whether their works that are sold for print publication can also be reproduced in electronic form.
That decision has led some to question whether publishers face yet another roadblock for putting content on the Internet.
"Napster took off because there was a latent opportunity and desire that was previously unfulfilled," said Christopher Warnock, CEO of ebrary.com. "You can't have that desire and market need unfulfilled or the marketplace will fill it themselves."
Free-lancer Jonathan Tasini, along with members of the National Writers Union (NWU), filed suit against media heavyweights The New York Times Company, Newsday, Time, Lexis/Nexis and University Microfilms over seven years ago.
In a 7-2 majority, the court upheld a September 1999 ruling by the U.S. 2nd Circuit Court of Appeals.
Publishers could now face billions of dollars in potential liabilities for legal claims dating back more than 20 years, before electronic rights or the Internet were even conceived.
"The Tasini case puts another level of complication from the publishers' perspective," Warnock said. "It's one more ... barrier to making products accessible on the Internet."
Following the court's decision, union leaders immediately went to the bargaining table to negotiate with the publishing industry.
"Now it's time for the media industry to pay creators their fair share and let's sit down and negotiate over this today," Tasini said in a statement.
By rejecting the notion that an electronic format is no different from a print edition, the Tasini decision will have broad implications for authors, consumers and publishers.
"What's being defined is essentially what constitutes an update or reprint of a document," Warnock said. "That has big implications for everyone."
The National Writers Union and the United Auto Workers International Union both hailed Monday's ruling as a victory for creators and consumers.
"Today's decision paves the way for writers and other creators to be fairly compensated for their work," UAW president Stephen Yokich said in a statement. "That's good news for all of us, because we all benefit when the legal protections of copyright encourage the creation of new art, science and literature."
But others disagreed, saying publishers that don't have the bandwidth or the resources to cover potential liabilities will pull electronic content from their databases.
If that happens, publishers could be less inclined to deal with free-lancers who are aggressive in asserting their e-rights.
"There may be lots of authors who would rather have their articles online without further payment than have their articles pulled off," said Charles Sims, a lawyer for the defense.
"The Times has lost this case and will now undertake the difficult and sad process of removing significant portions from its electronic historical archive," Arthur Sulzberger Jr., chairman of The New York Times Company, said in a statement. "Historians, scholars and the public lose because of the holes in history created by the removal of these articles."
Software and Information Industry Association (SIIA) leaders said they would lobby Congress to review the Court's decision, contending that the costs to reach settlement with thousands of individual free-lancers are too prohibitive to undertake.
"The effects of this ruling are detrimental to the informational utility of the Internet for users and consumers," said Ken Wasch, SIIA president, in a statement. "The decision leaves publishers little choice but to remove tens of thousands of articles from online databases, or face immense exposure to copyright infringement claims. Anyone seeking information online, including students, researchers, investors or simply families planning travel, will find their resources diminished."
But both writers and unionists say that scenario is unnecessary if both sides can instead seek a middle ground.
The NWU has presented its own solution, the Publication Rights Clearinghouse (PRC), which offers a way for writers and publishers to track copyright ownership and pay for authorized resale of copyrighted works.
While the court's decision will impact archives from the older guard of the e-publishing industry like Lexis-Nexis, it may have little impact going forward, since most publishers have included electronic rights agreements in their contracts since the appeals court decision.
"The National Writers Union must be smoking something if they think there is any likelihood of reaching an agreement," Sims said. "It's certain that publishers will withdraw huge numbers of articles.... The authors won't get a penny more."
Even so, some think an agreement is still likely.
"It's in the interests of both the publishers and the free-lancers to have a complete historical record," intellectual property attorney James Klenk said.
If the writers and publishers cannot come to an agreement, a solution is likely to be decided in the courts or in Congress.
The Tasini case may only be the first round of shots fired in the fight over e-rights.
The court's decision could seal the fate of three pending class-action suits, including one filed by a group of free-lancers against the Boston Globe accusing the publisher of unfair and deceptive trade practices in its all-rights agreements.
While a win for the publishers might have forced those cases out of court, they will now go forward.
"I say let the games begin," Sims said.
Reuters contributed to this report.
