The Court's holding in Grokster tells us that websites that enable you (or your teenager) to download audio or video from the Internet for free are almost certainly breaking the law. Those of you who were familiar with Napster already knew this. Napster was one of the first file-sharing services; it consisted of a central server to which its users uploaded files, which then became available to other users.
The centralized format made Napster an easy target for traditional infringement claims, and it was shut down. Grokster (and its co-defendants) provided a free software service instead of a central repository of files. Its decentralized "file-sharing network" allowed Grokster to claim ignorance of the contents of the billions of files users exchanged via its service each month. Grokster received no revenue from its users, instead making its money by selling advertising, which it streamed to the users as they merrily downloaded copyrighted material.
The practical ramification of the Supreme Court's Grokster decision may be the substantial limitation on free file sharing available on the Internet, with both centralized Napster-type services and decentralized Grokster-style services deemed illegal. The copyright holders have gone after the service providers as the most efficient method of stopping the infringement. In the future, free services are likely to be pushed offshore and forced to operate covertly -- an outcome that may diminish the quality of the files offered. Meanwhile, iTunes and other legitimate fee-based and subscription services have sprung up, offering MP3 files legally.
In the post-Grokster world, copyright owners may go after individual users. After all, ignorance is truly no excuse: Downloading music or movie files for free is illegal (unless one has the permission of the copyright holder or pays for the privilege). Uploading such files is equally illegal, and opens the user to the same charge of vicarious liability leveled at Grokster: Liability for every act of infringement by anyone else who later accesses the copyrighted material. We've long known there is no such thing as a free lunch. Now we know there is no such thing as a free song.