September 19, 2005
Volume 10, Issue 7
Welcome New Member eDonkey
Please warmly welcome MetaMachine, Inc. to the Operations Group. We look forward to providing valuable services to this newest DCIA Member and supporting its contributions to the distributed computing industry.
MetaMachine is the developer and distributor of industry leading peer-to-peer (P2P) file-sharing application eDonkey 2000. DCIA industry data resource BigChampagne in recent weeks has credited eDonkey with achieving substantial growth in its user base.
"File sharing has never been more popular than it is now," said BigChampagne CEO Eric Garland. About 9.6 million people were logged onto sharing networks at any one time in August, up from 6.8 million last year. Currently, eDonkey has the greatest number of these P2P users, with a 50% market share according to a just-released CacheLogic report.
MetaMachine's CEO, Sam Yagan, provided testimony at the December 2004 Federal Trade Commission (FTC) P2P Workshop in support of licensing content for authorized P2P distribution.
The company participated in the DCIA's P2P Revenue Engine (P2PRE) project focused on providing solutions for major entertainment content rights holders to securely market their copyrighted works via the P2P distribution channel.
eDonkey is a highly advanced file-sharing application, functioning as a completely distributed self-organizing P2P network and supporting redistribution of all file types running on Windows, Mac OS X, and Linux. Overnet is the distributed search network that eDonkey uses to find files. Overnet had previously been a standalone application prior to MetaMachine's integration of these two software programs.
Microsoft Takes P2P Mainstream
Excerpted from Addict3D Report
Microsoft will ship a technology as part of Windows Vista that aims to broaden the appeal of peer-to-peer (P2P) networking technology.
"P2P is a game-changer for application development," said Microsoft product unit manager Sandeep Singhal. P2P could especially benefit applications for mobile devices, where limited bandwidth is more of a concern.
The technology is best known for its use in file-sharing applications, but is also applied in content delivery applications including streaming radio and video services.
To allow third-party developers to incorporate the technology into their software, Microsoft will build-in support in Vista. The technology is part of the Windows Communication Foundation Platform, formerly known as Indigo.
eBay Calls on Skype for Growth
Excerpted from Online Media Daily Report by Gavin O'Malley
Web auctioneer eBay last week said it would buy DCIA Member Skype for between $2.6 billion and $4.1 billion, with the exact price depending on whether Skype meets performance targets over several years.
Skype is a leading player in the voice-over-Internet market – which, with its lucrative pay-per-call implications, has already attracted America Online, Yahoo, Google, and Microsoft.
In two years, the Luxembourg-based Skype has attracted 54 million members worldwide, who use the service to talk for free to other Skype users via computer. The charges kick in when Skype users make calls to – or receive calls from – regular phone numbers. The company expects revenues of $60 million this year and more than $200 million in 2006.
eBay said the deal will give its estimated 150 million merchants the ability to make, for example, last-minute sales questions with a "click-to-talk" function, and thus stimulate trade.
Meg Whitman, eBay's CEO, said on a conference call Monday that eBay, Paypal, and Skype should amount to an "unparalleled e-commerce and communications engine."
Report from CEO Marty Lafferty
 Congratulations to The Future of Music Policy Summit's Jenny Toomey, and her excellent team of Michael Bracy, Peter DiCola, Kristin Thomson, and Wendy Harman for staging a highly successful fifth annual conference last week, attracting nearly 600 attendees.
The FMC Policy Summit has emerged as the definitive forum for musicians, lawyers, academics, policymakers, and music industry executives to come together to discuss and debate some of the most contentious issues surrounding digital technology, artists' rights, and the current state of the music industry. Please click here for streaming archives of webcasts from this year's keynotes and panels.
If you will be attending Digital Hollywood this week, please plan to attend our panel on Wednesday at 11:00 AM: "Track I: Next Generation P2P Music and Film - DRM, Paid for Pass-Along and Other Legal Distributed Computing Models and the Entertainment Industries."
We plan to conduct a frank and candid discussion on the state of the rapidly evolving P2P channel for distributing entertainment content, led by industry leaders Les Ottolenghi, President, INTENT MediaWorks; Talmon Marco, Co-Founder, iMesh; Srivats Sampath, President & CEO, Mercora; John Beezer, President, Shared Media Licensing; Randall Crockett, VP of Operations, DRM Networks; and Chip Venters, CEO, Digital Containers.
Digital Hollywood introduces our subject this way: "While the debate over legal issues in music and movie distribution of content continues, the P2P and distributed computing industry is making strides in taking its technologies into the mainstream. With many evolving solutions on the way from paid-for-pass-along along with various DRM solutions and advertiser based options - and now an active trade association for P2P exists to enhance the solutions in the marketplace - we are pleased to hold a standalone solution session on the topic."
"In this session we will attempt to go beyond the legal issues into the practical applications of P2P in the marketplace. P2P advocates make claim to a major share of the market that will play a central force in the future of the music and film industries. In this session, we will hear the case for P2P - understanding it strengths and weaknesses."
If you are interested in exploring a greater level of participation in the distributed computing industry as a prospective DCIA Member, please accept our invitation to attend the DCIA Fall Meeting immediately following Digital Hollywood on Thursday morning at the Water Garden in Santa Monica. Our quarterly general meeting will be combined with the P2P PATROL fall meeting, which will be co-hosted by Joan Irvine, Executive Director of ASACP.
At the DCIA meeting, you will have the opportunity to see and hear firsthand the latest developments from leaders of the companies pioneering new business models for licensed content distribution via peer-to-peer (P2P) file-sharing technologies, as well as critiques from industry observers and new offerings from highly advanced solutions providers. We will also discuss a very promising proposal for an open-standards approach to securing content in this and related channels.
All DCIA Fall Meeting attendees will receive a new white-paper focusing on the economics of authorized content distribution by means of distributed computing technologies. Please contact DCIA Member Services leader Karen Kaplowitz at 888-890-4240 or karen@dcia.info for more information and to RSVP.
We would also like to commend Digital Hollywood's Victor Harwood for establishing a two-day Digital Rights Management (DRM) and Anti-Piracy Track at this year's conference. We join Victor in thanking track sponsor, DRM Networks, for hosting the related VIP Dinner Tuesday evening.
Here are this year's panel titles in addition to the one the DCIA will moderate: "The Piracy Freight Train: As Entertainment, The Law & Technology Collide;" "Piracy and Digital Rights Management: Legal, Legislative and Social Issues Surrounding DRM Implementation;" "Music Industry Innovates into Future - From Digital Downloads and Subscriptions to Mobile Music & Digital and Internet Radio;" "DRM Implementation in Media and Entertainment: From Standardization to Implementation of New Technology Strategies;" "DRM Interoperability Challenge - Consumer Satisfaction - Consumer Confusion;" "Entertainment Expands the Digital Home: Networking, Sharing and Protecting;" "Protecting Your Intellectual Property - The Policies and Technologies for Managing Risk;" "The Artists Strike Back - Will DRM & Anti-Piracy Initiatives Destroy Digital Music;" and "Music Industry Innovates and Morphs: Radio, Blogs, P2P, Ad Revenue Concepts, Cable/TV Innovation."
With this unparalleled effort, Digital Hollywood has succeeded in creating a gathering place for an international community of executives in the entertainment, technology, legal, and legislative sectors to facilitate the future of DRM and anti-piracy measures.
From Pier to Peer
Excerpted from GNB Report By Reeves Wolfson
Artists from across New York's musical spectrum gathered last week at a Chelsea pier to donate their time and talents to Good News Broadcast's (GNB) "Blue Water Community Hurricane Relief Concert."
One of the highlights was the performance of an exciting group called Blacksmith, a DCIA Member, which coins their music "country, rock, inspiration, blues" or "CRIB." With that many genres to claim, you'd think Blacksmith was spreading itself too thin; but they delivered. From Hendrix-inspired guitar blues to Sly Stone rock and soul, onward to Bob Dylan' folk classic, Blacksmith showed the diversity and musicianship that is lacking in many of today's artists. And they have a heart, too.
Blacksmith's bandleader, Al Smith, along with members Jimmy Sharp, Tom Griffin, George McNamara, Jason Spoor, and Miraj, not only contributed their time, but singer-songwriter Al Smith donated the use of his homelessness anthem "WHAT ABOUT YOU" to GNB's fundraising efforts.
Those efforts include supporting the New Orleans Rescue Mission (NORM). Headed by Executive Director Ron Gonzales, NORM is one of the organizations that has served the New Orleans community for years and will continue to do so after the worst of the disaster has passed.
"Our offices were wiped out by the flood and our ability to serve our community has been temporarily compromised," said Mr. Gonzales. "But with the generous support of folks like Al Smith and his band and Good News Broadcast we know we'll be back on the street helping those who need our assistance most."
In addition to the funds raised at the Chelsea event, video footage from the evening as well as the "WHAT ABOUT YOU" music video is being distributed via P2P through DCIA Member INTENT MediaWorks. The P2P audience, which is many millions strong, has the opportunity to view and purchase this material – with proceeds donated to the Red Cross – thereby also doing its part to help fellow citizens in the Big Easy.
In the first few days of the DCIA-backed Hurricane Katrina relief effort, P2P users downloaded DCIA Member Scooter Scudieri's "THIS TOO WILL PASS" more than 12,000 times!
P2P Volume Increases in August
Excerpted from Digital Music News Report
P2P user volume inched up globally in August, though levels in the US remained mostly steady. According to data supplied by DCIA industry data resource BigChampagne, the number of average simultaneous users worldwide surpassed 9.6 million in August, an increase of 1.3 percent over July.
When compared to the same period last year, the increase is a more drastic 41 percent, part of an overall surge in file sharing. In the US, total simultaneous user levels hit 6.87 million. But year-over-year figures also tell a big story in the US, with recent volumes representing a 51 percent jump over same-month figures in 2004.
Meanwhile, a flurry of major court decisions globally could be happening in a parallel universe for many casual file-sharers, with the landmark MGM v. Grokster having little impact on overall P2P activity. And while services like Morpheus, Grokster, and now Kazaa are likely to undergo changes, file sharers are quick to jump to competing applications. That offers the biggest challenge to a breed of upcoming, sanctioned P2P applications, though so far the space remains largely untested.
eDonkey Tops P2P in France & Germany
A recent study conducted by intelligent broadband network equipment maker Sandvine, confirms that eDonkey continues to be king of P2P file sharing networks in France and Germany.
P2P file sharing is a worldwide phenomenon that continues to evolve and take on new followers. In Europe, upstream traffic represents up to 85% of all bandwidth consumed on broadband provider networks. Downstream P2P traffic represents about 60% of all bandwidth consumed. File sharing in the UK and North America consume about 48% of total bandwidth on the downstream and 76% on the upstream.
"P2P file sharing is here to stay," said Chris Colman, managing director of EMEA marketing and sales. "P2P file sharing is a valuable subscriber application. Broadband service providers need to have visibility into these popular subscriber applications so they can reduce congestion in the network and ensure their subscribers' quality of experience."
When it comes to P2P file sharing, the French vault their way to the top with an impressive 90% on the upload, at all hours of a 24-hour day and 85% on the download. In Germany, upstream usage hits the charts at 83% with the downstream at 65%.
In Germany, eDonkey handles about 72% of all file-sharing traffic, while BitTorrent consumes about 16% of traffic. eDonkey captures 80% of all French P2P traffic with BitTorrent trailing behind FastTrack and Gnutella. Please click here for a related chart.
eBay Leads Sponsored Search Links
Excerpted from CMR Research Brief
Nielsen/NetRatings reported that search sponsored links, led by eBay, Shopping.com, and InterActiveCorp, comprised 34 percent, or nearly 13 billion, of online advertising impressions, according to its new AdRelevance Sponsored Search Link service.
Rick Wainschel, vice president of marketing research, Kelley Blue Book, said "We find the search term capabilities extremely helpful in providing in-depth insight into how key competitors have targeted top search terms, providing essential tools for our benchmarking."
eBay ranked No.1 in sponsored links placements, which featured more than 15,000 companies, during the week ending August 21. EBay placed nearly 400 million sponsored link impressions, equating to three percent of total placements that week. Shopping.com ranked second, placing 138 million sponsored link impressions.
Digital River & MSFT Digital Locker
DCIA Member Digital River, a global leader in e-commerce outsourcing, last week announced it is providing downloadable software and e-commerce services for Microsoft's new Digital Locker on Windows Marketplace Labs.
Microsoft's Digital Locker enables people to easily acquire and download software from the rich portfolio of products available on the Windows platform. Working through Digital River's 'oneNetwork' online sales channel, Microsoft is offering its customers easy access to a collection of titles from Digital River's downloadable software catalog.
"Through oneNetwork, we continue to create valuable relationships between tens of thousands of software publishers and resellers," said Joel Ronning, Digital River's CEO. "By working with industry leaders such as Microsoft, we can further expand this online community and reach more consumers in the digital marketplace with our extensive software catalog."
"Microsoft and Digital River are committed to helping both software vendors and customers take advantage of online shopping and downloading. Digital River's vast network of applications has enabled many customers to explore and locate popular brand name applications as well as applications that aren't available through traditional reseller channels," said Joe Peterson, Corporate Vice President of the Windows Client Division at Microsoft.
Josh Ritter on Tour
Excerpted from Ultimate-Guitar.com Report
On September 28th, Josh Ritter will head out on a fall tour with The Frames, showcasing new material from his forthcoming album for DCIA Member V2 Records, "The Animal Years," to be released in early 2006. The fall tour features dates in New York, Los Angeles, Boston, Atlanta, Chicago, and Philadelphia.
V2 Records recently signed Ritter and released his critically acclaimed CD "Hello Starling" – packaged with a special EP featuring previously unreleased live songs from a recent show in Dublin. Ritter's talent as a songwriter was immediately recognized when he emerged in 2002 with the self released "Golden Age of Radio" earning him a loyal following with fans and critics alike both at home and abroad.
Following that release, "Hello Starling" was independently released on the small independent label Signature Sounds catching the attention of V2. Throughout Europe, Ritter continues to have great success. In Ireland, he attracts a large and dedicated following. This summer, he performed at the Oxygen Festival there with Jimmy Eat World and The Doves.
PeerMe and Bounty
Excerpted from Digital Media Wire Report
PeerMe, a provider of P2P voice communications services, announced Friday that it has partnered with downloadable game distributor Boonty, to create a series of PeerMe Games channels.
PeerMe's P2P voice Internet telephone service will soon offer downloadable PC games, ringtones, and other software from Boonty's library of titles from over 150 game publishers.
Macrovision & Solid Networks in Japan
Macrovision and Solid Networks last week revealed plans to digitally distribute PC videogames in Japan. The two companies signed an agreement to extend the Macrovision model of digital distribution into Japan, offering secure online game distribution to game developers and publishers and a catalog of legitimate downloadable games in a try-before-you-buy format to portals and e-commerce sites.
"This partnership highlights the importance of the Asia-Pacific region to our expansion plans," remarked Todd Basche, GM of Macrovision's games division. "With Solid Networks' help, we're taking the strength of Macrovision's distribution network in the US and Europe and giving it a more proactive reach around the globe."
Working with Solid Networks, Japanese game developers and publishers will use Macrovision's Trymedia product line of secure digital distribution technology to distribute titles online while Solid Network's 'Solid Pay' multi-gateway billing system provides the e-commerce aspect for distributors.
Solid Networks CEO Keita Otsuka said, "By combining our infrastructure and network of contacts in the game industry in Japan with Macrovision's state of the art digital distribution technology, Solid Networks is positioned to rapidly expand the nascent Japanese market for downloadable game content."
Firms Urged to Protect Music Industry
Excerpted from Wall Street Journal Report by Sarah McBride
The RIAA sent cease-and-desist letters to several file-sharing companies, including BearShare, LimeWire and WinMX, asking that they stop activities that allow users to download copyrighted music.
The letters ask the companies to "immediately cease and desist from enabling and inducing the infringement of RIAA member sound recordings," according to a copy of the letter reviewed by The Wall Street Journal.
The letters are an attempt by the music industry to build on the favorable ruling it received from the US Supreme Court in June in the so-called Grokster case.
The RIAA has long said it supports legal uses of file sharing. It wants file-sharing firms to alter their software – for example, by creating filters to strip out copyrighted material or creating mechanisms to pay copyright holders. In recent months, it has been working with several file-sharing firms to create services that wouldn't violate copyrights.
The file-sharing companies that received cease-and-desist letters can shut down, fight the RIAA in court, or make changes that mollify the RIAA.
Coming Events of Interest
▪ Digital Hollywood Fall – "Transforming the Entertainment Industry." September 19th-21st at Loews Santa Monica Beach Hotel in Los Angeles, CA. The preeminent digital media and entertainment conference in the country. This year featuring a series of special University Project workshops. The DCIA will moderate "Track I: Next Generation P2P Music and Film - DRM, Paid for Pass-Along and Other Legal Distributed Computing Models and the Entertainment Industries." The DCIA Fall Meeting will be held Thursday morning September 22nd from 9:00 AM to 12:00 noon at AGSK in Santa Monica. Please contact DCIA Member Services leader Karen Kaplowitz for more information at 888-890-4240 or karen@dcia.info.
▪ Technology Law Institute – A Digital Media Rights panel will be featured September 20th at the Headquarters of the State Bar of Georgia, in downtown Atlanta, GA. Kilpatrick & Stockton's James Trigg will moderate with speakers Renay San Miguel from CNN, Kevin Lapidus from YellowBrix, and Marty Lafferty from the DCIA.
▪ OMMA East – In NYC on September 27th-28th, you can be a part of the most thought-provoking, timely and insightful marketing events of the year. Topics include ad networks, desktop and adware programs, local search, publishing consumer generated content, word-of-mouth online, RSS, podcasting, blogging, and integrated search planning. Click here to save 30% off of on-site registration.
▪ Atlanta Interactive Marketing Association – September 28th at the Global Learning & Conference Center, Atlanta, GA. AiMA Idols - Another reason to party. Bands and musicians from Atlanta's interactive marketing firms entertain at hot night club, eleven50. Free beer or wine and munchies. Lots of fun to play and network.
▪ IP3 Awards – Join Public Knowledge in celebrating its 4th Anniversary and 2nd Annual IP3 (Intellectual Property, Information Policy & Internet Protocol) Awards September 29th at the Sewall-Belmont House in Washington, DC. Tickets are $100 per person for individuals/private corporations and $50 per person for academics/non-profits.
▪ Intelligent Selling Of Internet Media – October 11th at the Arlington, VA Hilton. Topics include terminology, metrics and measurement, ad serving, rich media, targeting, how buyers evaluate and buy, proven tips and techniques for increasing revenue from new and existing advertisers and how to creatively package and sell awareness and lead generation programs, maximizing sell-through.
▪ eMarketing-5 East – Boston, MA on October 18th. eM5 is the 6th annual eMarketing Association Conference. The event is open to both members and non-members, members receive a 10% discount off the registration rate. Topics include search, e-mail, banner, affiliate marketing, on and offline integration, rich media, legal issues, and more. These are high level presentations geared to experienced marketing and business professionals.
▪ The Future Of Branded Entertainment – October 19th at the Grand Hyatt, New York, NY. What will state-of-the-art programs look like in the future? How do you measure them? What's fair market value for getting a product into a media vehicle? And does it all really work? Marketing in the 21st century demands innovation, creativity and the next "big idea." Success is in the hands of marketing professionals with vision, courage and commitment.
▪ Search = Media – San Francisco, CA on October 20th. From marketers to publishers to television networks, search has forced all players in the media industry to reconsider how they do business. Drawing on recently published work and experiences with blogging, this event will introduce the concepts of the database of intentions, the point-to economy, and intent-over-content - and how they can help media companies thrive in a Web 2.0 world.
▪ Internet Telephony Conference & EXPO – DCIA Member Skype CEO and founder Niklas Zennström will deliver the keynote address at this major conference at the Los Angeles Convention Center, CA October 24th–27th. His address, which will be delivered live from London via Internet Telephony Videoconference, will take place Tuesday, October 25th at 12:15 PM PT. Click here to register for the show.
▪ The Blogging Enterprise – November 2nd in Austin, TX. A one-day conference that will explore blogging, podcasting and video podcasting and their potential benefits and value in building brands, educating prospects, making sales and cultivating customer loyalty. Attendees will depart with new ideas and a better sense for how to implement this new technology successfully.
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