What are they thinking out there in California?

A Califorian bill introduced last week (article at Cnet) would, if passed, expose file-swapping software developers to fines of up to $2,500 per charge, or a year in jail, if they don't take 'reasonable care' to prevent their software from being used to commit crime.

Here's the definition of P2P (Peer to Peer) software in the bill:
"software that once installed and launched, enables the user to connect his or her computer to a network of other computers on which the users of these computers have made available recording or audiovisual works for electronic dissemination to other users who are connected to the network. When a transaction is complete, the user has an identical copy of the file on his or her computer and may also then disseminate the file to other users connected to the network."
Funny, seeing as IRC, HTTP, and FTP all clearly fall into this category under this definition. I'm sure all of them have also been used to tranfer files illegally. Several of these network protocols are used every day by millions of people daily. Microsoft has built in file sharing in their operating systems, will they be charged under this law? Also, under this law with this definition, a program that would make a simple change in the header information for the file when it is transfered would make the copy not an exact copy, and thus would not apply under this law.

Will this bill really accomplish anything? Are they planning on selectively choosing who will be prosecuted under this law? Will large corporations such as Microsoft and Apple be charged as their software can be used to transfer files just as these P2P networks? I don't see any restrictions on windows file sharing that prevents users from transfering illegal copies of movies, games, or music. Do the people writing this bill have any idea about the field they are governing?