Peter Kafka

Recent Posts by Peter Kafka

Even Wall Street Won’t Pay for Content: Financial Times Sues Blackstone for Web “Fraud”

Earlier today I suggested that we were headed toward a two-tier information economy where wealthy people pay for good stuff and everyone else gets free crappy stuff. But I may have miscalculated–maybe even rich people won’t be willing to buy the good stuff.

That’s one lesson you might derive from this odd lawsuit: The Financial Times is suing Stephen Schwarzman’s Blackstone Group (BX), claiming that the private equity group has been defrauding it since 2002. How? By allowing multiple people to use a single account to access articles on the paper’s FT.com site.

The FT figures that this was done with the approval a “senior” Blackstone finance executive and constitutes a “massive” crime since a yearly subscription to the paper’s Web site costs up to $299 a year. It’s suing Blackstone for copyright violation and computer fraud. (Redundant disclosure: The FT competes with The Wall Street Journal, which owns this Web site and which also charges for comprehensive access to its Web property.)

And if you’re thinking this seems like an odd way for a powerhouse publisher to settle a billing dispute with a giant private equity company (even after the economic meltdown, Blackstone sports a $1.2 billion market cap), well, you’re not alone. I double-checked with an FT spokeswoman who told me that the company had no comment, but confirmed that the complaint below is indeed real.

Thanks to CityFile for pointing this one out.

Black Stone

[Image Credit: World Economic Forum via Wikipedia]

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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work