Top Payment Providers Squeeze Online Pirates

Mar 3, 2011 6:00 AM PST
LONDON — Visa, MasterCard, London police and the international recording industry have teamed up to tackle illegal online services that sell unlicensed music.

Just like in the porn industry, music producers and owners have suffered substantial economic hardships because of online piracy.

Porn producers have fought back by filing numerous BitTorrent lawsuits. And now, music producers, artists and owners, who have tried to tackle piracy for years, are hoping a partnership with two of the biggest payment providers, Visa and Mastercard, will help them in their fight against pirates.

Under the arrangement, the International Federation of the Phonographic Industry, a group which seeks to safeguard the rights of record producers and has some 1,400 members, can secure action by police against websites that infringe its members’ rights. Details of 24 copyright infringing music services have been handed over to the police to date.

Once the police have verified the evidence, they notify MasterCard and Visa who require the acquiring bank providing the retailer with payment services to produce evidence of appropriate licenses to sell music or cease providing those services to the retailer.

Industry anti-piracy experts have drawn up best practice procedures for MasterCard and Visa, to distribute both internally and to banks that use their services, which help identify infringing websites and prevent them from being granted card payment facilities.

“It is extremely positive for the recorded music industry that the world’s largest payment systems are taking steps to prevent their services being abused by illegal websites that infringe the rights of artists, songwriters and producers,” said Frances Moore, chief executive of IFPI.

“Intermediaries, such as MasterCard and Visa, can play a key role in tackling online piracy wherever it originates around the world.”

To make sure the new system works effectively in practice, MasterCard has committed to deal with requests involving law enforcement quickly.

“MasterCard is pleased to support IFPI and law enforcement to help prevent the illegal sale of unlicensed music,” said Eileen Simon, chief franchise development officer, MasterCard Worldwide.

“A coalition approach such as this will enable us to prevent our system from being used to carry out this illegal activity and will help protect the livelihoods of artists, legal rights holders and legitimate e-commerce merchants selling properly licensed material.”

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