In what some billed as the battle of the entertainment industry against the tech world, Hollywood got its happy ending, while Wired quipped, "Grokster Loss Sucks for Tech." The U.S. Supreme Court was unanimous yesterday in ruling that online file-sharing services, like Grokster, could be held accountable if they encourage users to illegally trade copyrighted files - songs, movies and TV shows. The ruling in Metro-Goldwyn Mayer Studios v. Grokster overturned lower court decisions that said file-sharing networks were not liable because their services provided substantial legitimate uses.

Instead, as Justice Souter inelegantly put it, "We hold that one who distributes a device with the object of promoting its use to infringe copyright, as shown by the clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties."

In turn, most observers were unanimous in the verdict that peer-to-peer file sharing would not abate, at least in the near term. Many networks are decentralized to a degree that would allow them to exist even if there is not parent company. Moreover, many are based outside the United States and may be out of reach for U.S. courts.

Nevertheless, the Supreme Court's court decision will likely allow media companies to use lawsuits as economic sticks with which to beat U.S.-based file-sharing networks into submission.

The parties will now head back to the lower courts, which may yet find for Grokster based on the merits of the case.

Additional sources:

- The full text of the Supreme Court's decision

- Articles from the New York Times, Wired, Wall Street Journal, CNET, and the BBC.