MMW-81 -- Update on the 'Winny Trial'

J@pan Inc Magazine Presents:
Commentary on Japan's music technology news

Issue No. 81
Thursday, July 7, 2005



++ FEATURE: Update on the 'Winny Trial'

** MCF Survey Tracks Mobile Music Growth in Japan
** Sony Pictures Entertainment Launches Jazz Site for Chaku-uta Full
** Dwango Releases New Song from m-flo Exclusively as Chaku-uta
** Label Mobile to Open New Chaku-uta Sites for Rock, Club Music
** Yamaha Launches Music Box Chaku-uta Site

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++ FEATURE: Update on the 'Winny Trial'

Handing down their decision last week in the closely watched MGM
vs Grokster case, the US Supreme Court ruled unanimously against
Grokster and Streamcast Networks, on the grounds that both
companies had knowingly encouraged and profited from copyright
infringement by users of their file-sharing services. The court stopped
short, however, of saying that the file-sharing technology itself is illegal,
in effect placing the burden on plaintiffs in future US lawsuits to prove
that a service knowingly encourages and benefits from copyright violation.

Hearing news of this verdict reminded me of the recent case in Japan
against Isamu Kaneko, the university research assistant and developer
of a Japanese P2P program called 'Winny'. Some readers may recall
that Kaneko was arrested in May of last year and subsequently indicted
for 'aiding and abetting copyright infringement'. The arrest was big news
in Japan, and sparked a 'Free Kaneko' movement that raised over
JPY 11 million (US$100,000) for Kaneko's bail. When Kaneko's trial
started in Kyoto last September, there was again much media attention
and debate about the legality of P2P software in Japan.

Since then, however, Kaneko's trial has largely faded into the
background here with almost no mainstream news coverage and only
occasional reports from Japanese bloggers. The relative lack of coverage
left many in Japan - including myself - wondering 'what ever happened
to that Winny guy?' With my interest rekindled by the recent US ruling,
I went back to the Japanese blogs and tried to determine what exactly
had happened with the Winny trial.

Turns out the trial is still in progress, but progress is slow. Since its start
last September, there have been 12 'sessions'. Each session is about four
hours long and they are scheduled roughly three weeks apart. The 13th
session in the Winny trial is currently scheduled for July 14, and it is still
unclear exactly how many more sessions will be needed before a verdict
is reached.

Kaneko's defense attorney, Toshimitsu Dan, spoke at a seminar in Tokyo
last week and outlined three points that have been central to Kaneko's
defense strategy:

1. Kaneko did not profit from Winny.
Under Japanese law, to be guilty of aiding and abetting a copyright violation,
the defendant must profit in some way. Winny was publicly available for free,
and Kaneko did not make money from it. This contrasts sharply with the case
of Grokster and Streamcast Networks, whose business interest in the service
was the key to the verdict against them

2. Kaneko did not meet the users who committed the infringement.
Here again, the law in Japan requires that the defendant have given intentional
assistance to the individual who committed the copyright violation. Dan pointed
out again that this was not the case with Kaneko, and the creator of a product
cannot be held liable for illegal use of the product. Otherwise, auto makers
would not be allowed to sell cars that go over the speed limit, etc. etc.

3. A conviction will hurt Japan's economic competitiveness.
Interestingly, this is quite possibly the argument that could swing the case in
Kaneko's favor. A conviction against the creator of Winny will deter other
developers in Japan from making similar types of distributed software systems.
Because it is likely that in the future much legitimate business will rely on
this technology, Japanese companies will be at a competitive disadvantage if
researchers and developers are afraid to invest in making cutting-edge P2P

Though it is still unclear when a verdict will be reached in the Winny case,
we will continue to monitor the sessions in Kyoto and follow up with a report
when the decision is finally handed down.



** MCF Survey Tracks Mobile Music Growth in Japan
In brief: The Mobile Contents Forum (MCF) released the results of a survey this
week in which it found that the market for polyphonic MIDI-based ringtones in J
apan grew 6% in 2004 to reach JPY 116.7 billion (US$1.05 billion). The survey
also found that the chaku-uta market in 2004 grew 631% to hit JPY 20.1 billion
(US$181 million).


** Sony Pictures Entertainment Launches Jazz Site for Chaku-uta Full
In brief: Sony Pictures Entertainment started a new chaku-uta full site last week
devoted entirely to jazz music. The site, called 'Jazz Max Full', is the latest
chaku-uta full site to appear on KDDI's EZWeb service. In addition to full-song
downloads of famous jazz tracks, the site also features information on jazz
clubs and restaurants in Japan.


** Dwango Releases New Song from m-flo Exclusively as Chaku-uta
In brief: It is becoming more and more common in Japan to see popular J-Pop
artists making chaku-uta the intro media for new releases. In the latest case,
Dwango announced last week that it would release two new songs from
m-flo exclusively on its chaku-uta site on July 1, nearly two weeks before the
songs are due out in the stores.


** Label Mobile to Open New Chaku-uta Sites for Rock, Club Music
In brief: Label Mobile will be launching two new chaku-uta sites on all three
Japanese carriers in July. 'Reco-choku ROCK STYLE' is devoted to rock
music and will start with a catalog of 8,000 songs. 'Reco-choku In The
Grove' is club music site that will start with 6,000 tracks. Together, the
two sites will offer tracks from 19 different record labels.


** Yamaha Launches Music Box Chaku-uta Site
In brief: On July 4, Yamaha opened a new chaku-uta site featuring music
box arrangements of popular J-Pop songs. The site has a
'relaxation/healing/new age' theme, and also features music from new age
artists. As songs are playing, the phone displays 'relaxing' images of rainbows,
trees, blue skies, etc. The service launched with 1,400 tracks and, 10-20
new tracks will be added weekly.


Entrepreneur's Handbook Seminar

Terrie Lloyd, founder of over 12 start-up companies in Japan
will be giviing an English-language seminar and Q&A on
starting up a company in Japan. This is an ideal opportunity
to find out what is involved, and to ask specific questions
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All materials is Japan-focused.
Fore more details:

Subscribers: 4,152 as of July 7, 2005

Written by: Steve Myers

Steve Myers is president and chief enthusiast of Theta
Music Technologies, which specializes in the development
of music-related software applications.

Edited by J@pan Inc editor: (


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