And California ….

Sony BMG Sued Over Anti-Piracy Software [pdf]

A California-based digital-rights group and the Texas attorney general sued Sony BMG Music Entertainment on Monday for selling compact discs with anti-piracy software that allegedly leaves computers vulnerable to hackers and viruses.

The cases highlight the narrow line walked by the recording industry as it experiments with ways to deter bootleggers. To be effective, copy-protection systems must be tough to crack. But software that’s too intrusive risks alienating music buyers — as Sony BMG’s so-called XCP technology has.

[…] However, copy protection isn’t ceasing. EMI Group, the nation’s fourth-largest record label, intends to include some form of copy protection on most of its releases by the end of next year. An EMI spokesman said the company had manufactured more than 175 million CDs that limit copying and received complaints from less than 1% of customers.

[…] Analysts said EMI’s low incidence of complaints demonstrated that the music industry could deploy technology that didn’t alienate listeners.

“The reason why people don’t complain is because most aren’t really copying CDs in the first place,” said analyst Phil Leigh of Inside Digital Media Inc. “If you can sell music at reasonable prices, consumers will gravitate away from piracy. Eventually companies will stop fighting their customers and just lower their prices.”