Yahoo chat choice signals Internet shift

Publisher vs. bookstore
Since their inception, Internet services have been home to all manner of off-color, alternative discussion groups.  It's also been a haven for criminals, who use chat rooms to sell and trade stolen personal data, child pornography and copyrighted material.  While no law protects firms that knowingly assist in the commission of a crime, it's not always been clear what responsibilities Internet providers have to control criminal or potentially undesirable activities that go on in their dark corners.

Generally, laws and court decisions have given muddled guidance — but have suggested that ignorance might be bliss. A 1991 federal court ruling in favor of CompuServe held that information carriers are not responsible for content distributed using their services unless they know the nature of the content. The court compared Internet providers to bookstores, libraries and telephone companies which are not expected to control all content they carry.

But a 1995 federal court ruling against the Prodigy Internet service found that Internet providers who actively monitor or edit their content assume liability for it, just as a book publisher would. 

The following year, America Online successfully defended itself against a lawsuit similar to the Prodigy case.  In that ruling, a federal court said Internet companies were insulated from liability for defamatory statements made by third parties on their services.

Despite the safe haven provided by the AOL ruling, Internet providers have sometimes suggested they were better off taking a "hands-off" approach to public chat and bulletin boards, choosing to limit their role as editors to avoid liability. The "ignorance is bliss" notion may have contributed to the acceptance of unsavory Internet chat and bulletin boards, Aftab said.

Today, federal law provides Internet service providers with wide protection against defamation lawsuits, Goldman said, giving them more latitude to act as content editors without incurring additional liability. And Yahoo has always had the right to clean up its chat rooms of illegal activity, without additional legal risks, he said. 

Still, potential legal threats to Yahoo over its status as a provider of chat tools and services may have had an impact on the firm's business strategy. And that would be disturbing, Goldman said. "We need to be very careful about putting intermediaries on the hook for how people use these tools," he said. 

The question of who's responsible for the activity of Internet users and their tools is complex, and might get even more complicated next week. On Monday, the U.S. Supreme Court is due to rule on whether the makers of the Grokster file-swapping software can be held liable for the illegal activity of its members. The court is considering a lower-court ruling that said Grokster was not liable — a ruling that contrasted with the outcome of the earlier Napster case, which led to the shutdown of the famous music-swapping site. (Napster has since been revived by new owners as a legally sound commercial music service.)

Some lessons from the file-swapping debate can be applied to the chat issue, Goldman said.  Discontinuing the user-defined chat rooms will simply push users to other services, which might have unexpected and undesirable consequences, he said.

"Shutting down Napster caused 1,000 P2P [peer-to-peer] services to bloom," he said.

'Curing dandruff by decapitation'
Online chatters were quick to register their complaints about the Yahoo shutdown. At ChatMag.org, many former Yahoo users expressed outrage. "This is the proverbial case of curing dandruff by decapitation," wrote one.

But the complaints were not universal. A poster named "Last Resort," who said he has been part of a group that tried to chase away potential pedophiles from Yahoo chat rooms, called the step courageous.

"The loss of the user-created chat rooms, that were created for the use of perverts, pedophiles, to lure children in for the perverted pleasures of adults, is no great loss, except to the perverts," he wrote. "Yahoo finally having the guts to do this is something."

In the end, Yahoo's decision may have had more to do with business practicalities than legal niceties, Aftab said. Yahoo would find little business benefit in defending unpopular Internet free speech, she said.

"There is no business model for (unmoderated chats)," Aftab said.  "And a lot of unsupervised place on the Internet can be cesspools."

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