November 1, 2004
Volume 6, Issue 9
Studies Confirm P2P File-Sharing Growth
Peer-to-peer (P2P) file-sharing activity has continued to increase this year according to a new study, which footnotes two additonal reports that corroborate its findings.
Researchers from the University of California (UC) at Riverside and Cooperative Association for Internet Data Analysis (CAIDA) reported that P2P, led by the currently fastest growing applications eDonkey and BitTorrent, continues to expand.
A conclusion from the two-year study, which will be presented at IEEE Globecom 2004 later this month, is that those who claim that file-sharing traffic has declined (by as much as 50%) are wrong, because they have not used methodologies that measure the entire P2P universe.
In contrast, this research group collected data at two different links of Tier 1 ISPs (aka backbones) and measured multiple P2P protocols, rather than concentrating only on well-known applications like Kazaa, distributed by DCIA Charter Member Sharman Networks, and Gnutella.
The researchers point out that while first-generation P2P traffic was easily measurable as it used well-defined ports, newer versions of the P2P protocols use multiple ports.
UC's Thomas Karagiannis stated, "The assertion of declining P2P traffic was in direct contrast to the constant increase of P2P activity over the last year and counterintuitive to the fact that P2P applications are still the top most downloaded applications (on) the Internet."
BigChampagne CEO Eric Garland added that the study is a complement to BigChampagne's ongoing measurement of P2P usage.
"We look at the number of users and files. This (study) seeks to quantify the traffic – the volume in bits and bytes," Garland said.
According to BigChampagne, an average of seven million people currently use P2P services at any particular time.
The UC & CAIDA researchers also noted that P2P is now entering its second golden age, based on increasingly decentralized and more sophisticated technologies, following the decline of P2P when the original Napster closed down.
"P2P traffic represents a significant amount of Internet traffic and is likely to continue to grow in the future," they wrote.
Report from CEO Marty Lafferty
 We are proud to co-sponsor the first annual Billboard Digital Entertainment Conference & Awards (DECA) this week. It promises to present provocative panel sessions on rapidly changing digital entertainment issues and to recognize pioneering achievements in the field. More than eighty industry leaders will be speaking at the two-day event being co-produced by Digital Media Wire in the Tom Bradley International Hall at UCLA.
Special thanks to DCIA Members Alston & Bird, for individually sponsoring DECA, and to Trymedia Systems, for providing SVP Gabe Zichermann as a VIP award presenter for games and for recruiting GamesDAILY as an additional sponsor.
Keynotes and featured speakers include Congressman Howard Berman (D-CA); Seamus Blackley, Agent, Creative Artists Agency (CAA) and Co-creator of the Xbox game platform; Mark Cuban, Chairman, HDNet and Owner, Dallas Mavericks; Chris Gorog, Chairman & CEO, Roxio/Napster; Dennis Mudd, CEO, MusicMatch; Todd Rundgren, Recording Artist, Songwriter, and Producer; Bill Wilson, SVP & GM, AOL Entertainment; Phil Wiser, CTO, Sony Corporation of America; and Richard Wolpert, Chief Strategy Officer, RealNetworks.
Prominent entertainment industry participants include Mitch Bainwol, Chairman & CEO, Recording Industry Association of America (RIAA); Larry Kenswil, President, eLabs, Universal Music Group; John Kilcullen, President, VNU Music and Literary Group, Publisher, Billboard; David Nathanson, VP, Advanced Services & Channel Development, FOX; Jay Samit, General Manager, Sony Connect; Steve Schnur, Worldwide Executive of Music, Electronic Arts; and Howie Singer, Vice President of Technology, Warner Music Group.
DECA's closing panel, entitled THE FUTURE OF DIGITAL ENTERTAINMENT DISTRIBUTION CHANNELS, which we are sponsoring, features Bram Cohen, Founder, BitTorrent; and DCIA Member participants Phil Corwin, Chief Lobbyist, Sharman Networks (Owner of Kazaa); Marc Freedman, CEO, RazorPop (Owner of TrustyFiles); Tom Meredith, CEO, P2P Cash; and Chip Venters, CEO, Digital Containers.
In less than two years, P2P file-sharing programs were downloaded more than 600 million times to become the most rapidly adopted consumer software application in history; and the entertainment and technology industries are still playing catch-up ball to adopt new business models that will fully harness this distribution channel. Meanwhile, development has not abated.
Our panel of progressive technology innovators will preview what's coming next from the ever-evolving and increasingly decentralized broadband Internet (and now Internet 2). They will also offer their views of what can be done to ensure that all entertainment transactions can be monetized – according to usage rules established by content rights holders – given the realities of a rapidly changing digital distribution marketplace.
Digital Containers and RazorPop will also participate in the exclusive DECA press conference co-sponsored by BusinessWire. We will announce news regarding the P2P Revenue Engine (P2PRE), a solution major music labels and movie studios have been seeking in order to permit licensing the P2P distribution channel.
P2PRE will allow consumers to continue to copy entertainment content from CDs and DVDs for use on their PCs and portable players, and to continue to place such files in their P2P shared folders – but without risking copyright infringement. P2PRE will make it possible for content rights holders to offer a given title simultaneously as an ad-supported promotional version, opt-in subscription offering, and an a-la-carte sale.
Digital Containers will announce an example of the content that it will be packaging with related collateral material, background information, and collector's memorabilia for sale, forming a complete "digital collector's item," as part of the rollout of P2PRE. Digital Containers' patented software securely protects digital content redistributed via file-sharing software. It ensures that rights holders are appropriately compensated for the content each and every time a new consumer views or listens to it, and provides a way to recommend and sell additional digital content.
RazorPop will announce the launch of its new partner program for music, video, and game consumer-entertainment marketers and distributors. This new offering, powered by RazorPop's flagship TrustyFiles interoperable P2P software application, will provide custom file-sharing programs to partners that will carry their consumer-brand names, logos, links, home-pages, as well as promotional channels. RazorPop's newest product will enable these affiliates to market and sell promotional and secured files to the eighty million worldwide consumers who currently enjoy P2P file sharing.
The DCIA will hold our quarterly general meeting for Members and invited guests following the DECA reception on Thursday. The primary focus of this meeting will be a special patent-pool presentation from Alston & Bird. We will also have a status report on the P2PRE project, legislative update, and current working group and special project reports. Please contact DCIA Member Services leader Karen Kaplowitz at 888-890-4240 or karen@dcia.info.
Finally, the Digital Entertainment Awards Gala Dinner will be on Friday in the Grand Horizon Ballroom. This has been designed to be an entertainment-packed evening honoring cutting-edge developments and forward thinkers shaping the future of entertainment. In addition to DCIA Member Trymedia's Gabe Zichermann serving as a presenter, DCIA Member Alston & Bird is proud to sponsor BitTorrent founder Bram Cohen as a finalist for innovator of the year.
MP3 Player Offers MusicMagic by Predixis
Entempo has announced its new 20 GB MP3/WMA player, the Spirit. For just $199, avid music fans and heavy downloaders will be thrilled with its unique features and ShoX technology, which will afford the hard drive – one of a player's most sensitive parts – with five times greater protection than regular MP3 devices.
MusicMagic by DCIA Member Predixis will be available to Spirit users through download and will be embedded in units post mid-November production.
"Our vision for easy, spontaneous navigation of music collections, based on the sounds in the music, now fits nicely in the palm of your hand," said Marc Campbell, CEO, Predixis.
"MusicMagic will enable consumers to create dynamic playlists that can reach into their entire collections. Digital music will now be accessible and easy to use."
Other unique features of the Spirit include: a microphone built into the ear buds, which allow instant recording capability, and an integral FM tuner which allows recording directly to the hard drive. A large 164 x 104 backlit LCD displays the menu. File transfer is through a fast USB 2.0 connection. The battery lasts over 12 hours. Spirit works with all Windows operating systems.
"Spirit is designed primarily for our target group, the high school and college student," said Randy Kemps, Vice President of Marketing at Entempo. "Spirit is very affordable and may be used in more robust situations without fear of accidental damage."
Entempo will also introduce higher capacity models soon, as well as a wide range of accessories.
Future innovations will include TransFM Auto and TransFM Home which will allow the Spirit to be played through car stereo systems and through home music systems respectively.
Predixis is the result of fifteen years of experience with advanced pattern recognition software. A successful off-shoot of major applications firm Parasoft Corporation, Predixis is a solutions-oriented software company which solves the challenge of how to best match products to individual tastes. With its patented technology, MusicMagic, Predixis can deliver time savings and improved choices through e-mail, Internet browsers, smart appliances, kiosks, in-store shopping assistants, and consumer electronics, including MP3 players, stereos and mobile devices.
ESA Raises Funds to Help Children
The Entertainment Software Association (ESA), the video game industry's trade group, announced that it raised over $900,000 for children's charities last week in San Francisco at its annual "Nite to Unite for Kids" benefit dinner and public online auction. The ESA, which has raised over $6 million for charity to date, said this year's event will benefit Web Wise Kids, National Students Against Violence Everywhere, and the Association of Hole in the Wall Camps.
Coming Events of Interest
- Digital Entertainment Conference & Awards – The DCIA is proud to sponsor this first annual conference and awards show, focusing on innovation, entrepreneurship, and brand development in digital entertainment.
Co-produced by Billboard and Digital Media Wire, the "Billboard Digital Entertainment Conference & Awards (DECA)" will be held on November 4th and 5th at the UCLA Tom Bradley International Center. Seventy industry leaders will be speaking at the two-day conference on content and technology developments, including business, legal, and technology issues impacting the creative and business communities. To learn more about the conference and awards show, please call 323-822-0936.
The DCIA will hold its Fall General Meeting for Members only Thursday evening November 4th in conjunction with DECA. Please contact DCIA Member Services leader Karen Kaplowitz at karen@dcia.info or 888-890-4420 for Membership information.
P2P File-Sharing: Consumer Protection and Competition Issues – The Federal Trade Commission (FTC) will host a public workshop December 15th-16th to explore consumer protection and competition issues associated with the distribution and use of P2P file-sharing software.
The workshop is intended to provide an opportunity to learn how P2P file-sharing works and to discuss current and future applications of the technology.
Interested parties are encouraged to submit comments electronically at FTC P2P Workshop Comments. A detailed agenda and additional information on the workshop will be posted on the FTC's web site at FTC P2P Workshop Agenda.
The workshop will focus on uses of P2P file-sharing technology, the role of P2P file-sharing technology in the economy, identification and disclosure of P2P file-sharing software program risks, technological solutions to protect consumers from risks associated with P2P file-sharing software programs, P2P file-sharing and music distribution, and P2P file-sharing and its impact on copyright holders.
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