December 6, 2004
Volume 7, Issue 2
Welcome Javien & MusicDish Network
Please warmly welcome Javien Digital Payment Solutions and MusicDish Network to the Platform and Content Groups respectively. We look forward to providing valuable services to these newest DCIA Members and supporting their contributions to commercial development of the distributed computing industry.
Javien is a leader in the Internet commerce market for paid digital content. A first mover with micro-payment processing technology in 2000, Javien now offers total payment solutions to content-rich websites. Javien's ASP service, supporting subscription and pay-per-view payments, is a proven, seamless, immediate solution for turning Web content into profits, from articles and publications to movies and music. Javien's customers in the music industry include MusicNet, TransWorld Entertainment, and iMesh.
Citing strong demand from new customers in the music and peer-to-peer (P2P) industries, Javien announced its micro-payment aggregation engine last month at the DCIA co-sponsored Billboard Digital Entertainment Conference & Awards (DECA).That product is being released now along with numerous other enhancements, including a web services module for improved customization.
Javien's aggregation engine allows digital content merchants to choose how they want to bundle small charges before processing them onto a credit card based upon their specific business needs. For example, one merchant might determine five dollars as a threshold and another ten dollars, and time-based rules can also be applied.
The MusicDish Network is considered by industry observers to be the first true independent web music network. Representing a unique platform of over 200 entertainment-related sites from three continents, MusicDish produces and distributes original content focusing on today's emerging artists, plus news and insights from music veterans and experts.
The Network enables its affiliates to supplement their own material with news, tips, and commentary, the quantity and diversity of which they could not provide on their own. In return for participating, MusicDish partners also have the opportunity to gain additional exposure through the company's websites and newsletters.
MusicDish provides entertaining and educational articles, and introduces visitors to new innovative artists that are not widely publicized in mainstream media. The Network goes beyond the superstars heard on radio to promote undiscovered independent artists.
MusicDish's Content Express features well-written articles including pictures and audio files. Quality and diversity of content coverage, and ease of use, makes Content Express a greatly valued service among its affiliates. Artist Express compliments Content Express by featuring insights into the independent music scene and what its artists are accomplishing. The multi-media nature of these profiles makes them interesting to fans looking for unique bands outside of the traditional media channels such as FM radio and print magazines.
Most recently, the MusicDish Network pioneered a new artist-branded customized P2P offering in collaboration with DCIA Member RazorPop and the artist Yohany.
You can comment about that and related issues on the new P2P industry blog that RazorPop CEO Marc Freedman started in conjunction with Creative Weblogging at http://p2p-weblog.com.
"Worms Forts: Under Siege" Launch
Trymedia Brings Multi-Million-Selling Strategy Game to PCs
DCIA Member Trymedia Systems, secure digital distribution services provider and operator of the world's largest distribution network for downloadable games, announced last week that it will exclusively release "Worms Forts: Under Siege," Team 17's new title of the popular Worms franchise.
Consumers can purchase "Worms Forts: Under Siege" for $29.99 or download the try-and-buy version from Trymedia's consumer website or via Trymedia's P2P Distribution Network. With try-and-buy, fans are able play the full version of the game for a limited time. At any point during the trial period or at the end of the trial, they can purchase it.
"Trymedia is the perfect partner for us to distribute 'Worms Forts: Under Siege' for the PC," said Debbie Bestwick, Commercial Director of Team 17. "Their global distribution network enables us to reach both our core fans and brand new audiences."
"Worms Forts: Under Siege" is the tenth title in this hugely entertaining franchise. In the game, teams of worms battle across randomly generated landscapes. The new PC title features historically placed themes and environments, allowing players to travel through time from ancient Egypt to the mighty Roman Empire.
"By making it available via digital distribution, consumers will be able to download and immediately start playing this new title," said Gabe Zichermann, VP of Strategy and Communications of Trymedia.
"Publishers and developers, like Team 17, are realizing the benefits of digital distribution and seeing it as a viable new channel to expand the market for their games."
Report from CEO Marty Lafferty
 A DCIA Member made industry history last week by premiering the first-of-its-kind original peer-to-peer (P2P) video program series entitled "The Scene."
While other major entertainment industry representatives continued various actions around the world intended to curtail online file sharing, Jun Group took an enormous step forward in the commercial development of this exciting distribution channel.
Like theatrical motion pictures, broadcast television shows, and most recently cable programming, mass media outlets for video content have been able to mark the beginnings of their coming of age with the debuts of their first original made-for-the-medium content.
According to Jun Group president and show co-creator Mitchell Reichgut, "Most content that's available online was originally created for another medium. We created 'The Scene' specifically for file sharers. It's meant to be viewed on the computer."
On November 30th, Jun Group launched this first-ever TV-style series specifically for the global file-sharing community. "The Scene's" protagonist, Brian Sandro, is a fictional young NYU student who also happens to be one of the world's most avid file-swappers.
Sandro's desktop is at the heart of his social life, and viewers get to experience the online "Scene" just as he does – via Web cams, secret chat rooms, private websites, instant messages, and e-mails.
"The Scene" is financed entirely by sponsorships, which themselves exemplify the cutting-edge of creativity. Sandro visits the official website for the extreme sports equipment company that is one of its charter advertisers. He also listens to music on his computer and checks out the bands' websites – as college students typically do.
What makes the show most unique is the fact that it is being distributed solely through the P2P community. "File sharers have made it very clear that this is their preferred method of consuming content," Mitchell said. "We are the first ones who have found a way to truly meet that demand."
He added that the file-sharing audience is a highly desirable demographic of affluent and largely male young adults. Businesses pay for placement based on the number of people who are inspired by the show to visit a sponsor, which is both quantifiable and verifiable.
"Our sponsors will only be paying for the people who download the show or the people we drive to their websites," he noted. "They won't have to rely on outdated ratings systems."
There's no reason to copy-protect the shows, Mitchell said, because the whole idea is for people to copy and share them so that advertisers reach the highest possible number of consumers.
Executives at show sponsor Freebord phoned Jun Group two hours after the premiere to report that their website was "being swamped with traffic." Similarly, the website (http://welcometothescene.com) that Jun Group created to promote the show temporarily went down due to the overwhelming amount of traffic it was receiving.
It's clear that hundreds of thousands of people downloaded the show in first few hours after its release. "The Scene" is now out on P2P, and on IRC, Usenet, and public FTPs – with no strings attached.
"The Scene" represents Jun Group's latest foray into file sharing. In 2003, the company released five files from Kevin Martin and the Hiwatts, a band featuring the former lead singer of Candlebox, on behalf of YooHoo Chocolate Drink.
The music was downloaded more than two million times over a four-week period, and helped YooHoo achieve the largest spike in website traffic since the inception of its site.
Its more recent partnership with rock legend Steve Winwood and the television show Access Hollywood drove over 3 million downloads and well over 200,000 visitors to the Access Hollywood website.
Sales of Winwood's album, "About Time," rose an astounding 1,300% in several major markets, and Jun Group was named as a 2004 DECA finalist in the category of Best Use of Technology for a Music Marketing Campaign.
According to Mitchell, Jun Group's new show "The Scene" is more evidence of the growing influence of P2P: "The file sharing community is a legitimate mass medium – one that is maturing very quickly."
SNOCAP Lands Funding and UMG Deal
Digital Media Wire
SNOCAP, a start-up founded by Napster inventor Shawn Fanning to secure and monetize peer-to-peer (P2P) file sharing, announced Friday that it has raised $10 million in funding and signed major label Universal Music Group (UMG) as its first client.
The financing round was led by WaldenVC and Morgenthaler Ventures. SNOCAP's system uses audio fingerprinting technology licensed from Philips to identify, register and track music that is available for licensing, and allows labels and artists to set business rules for each track on a global basis – even making them securely available to users of file-sharing software like Kazaa.
UMG has already begun submitting its entire catalog to SNOCAP, and the Los Angeles Times reports that Sony BMG and EMI have also expressed interest.
The service would also enable labels and artists to track live shows, bootlegs, and out-of-print recordings traded via P2P software, and potentially make money from these as well.
"There are some good authorized online music services but they have limited content and a comparatively small number of users. There are unauthorized services that have content and users orders of magnitude higher. SNOCAP is the means to bridge that divide for the consumer," said co-founder Shawn Fanning. SNOCAP is slated to deploy in 2005.
DCIA Chooses BigChampagne as Data Resource
The DCIA has selected BigChampagne as its official data resource to measure and report industry growth along key metrics. Beginning in January, DCINFO will feature a regular monthly update quantifying key aspects of consumer usage, content delivery, and other factors critical to commercial growth of peer-to-peer (P2P) technologies.
According to DCIA Consumer Research leader and President of Feldman Research Lab, Rich Feldman, "The P2P industry has reached the stage of development where members will value the tracking of performance trends across several key indices. Having examined alternative sources for this type of ongoing research over the past six months, we have selected BigChampagne as the most knowledgeable and reliable supplier to perform this role."
BigChampagne is the leading provider of information about popular entertainment online. Its focus is on the world's most popular "download" communities: users of file-sharing software. BigChampagne CEO Eric Garland notes that, "Since our inception, BigChampagne's primary interest has been in the phenomenon of P2P file sharing, first made famous by Napster, and now including clients like BitTorrent, eDonkey, iMesh, Grokster, Kazaa, TrustyFiles, and hundreds of others."
BigChampagne was founded in 2000 as a technology-driven market research and marketing consulting firm, specializing in P2P technology. Its "TopSwaps" chart services were introduced early in 2002.
Leading P2P software applications offer the richest published consumer data of any online communities. Users share their tastes in music, film, games, etc. in an open exchange. BigChampagne profiles this activity at the highest levels and in granular close-up. It does not collect or report any identifying information about individual users.
In addition to BigChampagne's published chart information, it offers trend analysis, forecasting, and custom research. Because the current active audience numbers in the tens of millions, and is made up of highly motivated "early adopters," the company is able to observe close correlations between online interest and offline sales.
Perhaps the most important feature of BigChampagne's market research data is that it is strictly behavioral rather than self-reported. Unlike survey and focus group data, the information it gathers and reports is strictly and passively observed. Since the rise and fall of Napster, file sharing has moved into the mainstream. At present, tens of millions of consumers access one or more of these software programs each month.
BigChampagne's commitment is to develop measurement technologies and marketing strategies for the distributed computing industry, recognizing the extraordinary opportunity that P2P architecture offers all content creators in improving distribution, customer profiling, and true permission-based marketing.
Coming Events of Interest
- Music 2.0 – iHollywood Forum will present its second annual digital music summit December 8th–9th at the Universal Hilton in LA. Music 2.0 will analyze trends affecting the business of digital music, including music's growing portability, digital distribution, online marketing, and the rapidly expanding number of services targeting music consumers.
DCIA Member Predixis' CEO Marc Campbell will be a featured speaker 12/8 at 2:15 PM in "Music on the Go" moderated by Hollywood Reporter's Chris Marlowe.
- 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. 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.
- Digital Hollywood at CES 2005 - Digital Hollywood will present a full program at the Consumer Electronics Show in the Las Vegas Convention Center North Hall, January 6th-8th.
The DCIA is proud to moderate "Next Generation P2P Music and Film - DRM, Paid for Pass-Along, and Other Distributed Computing Models and the Entertainment Industries" featuring Adrian Sexton, Executive Director, Business Development, Lions Gate Entertainment; Richard Conlon, VP Licensing, BMI; Derek Broes, Windows Client Strategic Relations & Policy, Microsoft; Marc Morgenstern, Vice President, Overpeer; Mark Ishikawa, Chief Executive and Technology Officer, BayTSP; Michael Weiss, President & CEO, StreamCast Networks, and Gerd Leonhard, CEO, ThinkAndLink.biz and Senior Advisor, Media Rights Technologies.
- P2P PATROL - Parents And Teens React On Line - The industry's anti-child-pornography initiative will hold its quarterly working session with private sector and law enforcement representatives in Dallas, TX on February 1st. For more information and to learn how you can contribute to P2P PATROL, please contact sari@dcia.info or call 888-864-DCIA.
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