October 3, 2005
Volume 10, Issue 9
Welcome New Members
Please warmly welcome MediaPass Network and The Goldsmith Company to the Content and Platform Groups respectively. We look forward to providing valuable services to these newest DCIA Members and supporting their contributions to the distributed computing industry.
MediaPass Network focuses on delivery of music videos to personal computers and mobile devices. MediaPass' current content offerings include DancePass, HipHopPass, and RockPass, as well as its flagship MediaPass Music. It has been a featured content partner within WindowsMedia.com, and recently participated in a national press event at SXSW announcing the launch of its new music-video download service. MediaPass has distributed well over 200 live-on-demand webcasts reaching millions of end-users. The firm has seamlessly integrated its original independent content with mainstream talent including: Madonna, Missy Elliott, OutKast, Beyonce, Busta Rhymes, Radiohead, ColdPlay, and Red Hot Chili Peppers.
The Goldsmith Company specializes in digital media distribution, developing content strategies for re-purposing libraries, originating targeted content, and developing advertising that will reach consumers wherever they may be – anytime, anywhere on any device. The firm is responsive to the growing demand for knowledgeable media expertise that can address new platforms including peer-to-peer (P2P), VOD, e-mail and DVD marketing, DRTV, IPTV, IP Broadband, PVRs, mobile-wireless, iTV at home, as well as private commercial and digital signage networks in the emerging "out of home" market.
P2P Users Share to Help Katrina Victims
Communities across America have generously responded to the urgent needs of those impacted by Hurricane Katrina. Now one of the newest communities – P2P file-sharing software users – has joined in the efforts with the downloading and purchase of a song dedicated to the storm's victims.
P2P users quickly contributed more than $4,000 to the American Red Cross' Disaster Relief Fund by purchasing "THIS TOO WILL PASS," written and performed by DCIA Member Scooter Scudieri. Recorded and launched just days after Katrina's landfall, "THIS TOO WILL PASS" was previewed more than 12,000 times in its first week.
File sharers can purchase the song for 89 cents ($.89), with 80 cents ($.80) going directly to Red Cross relief efforts. Scooter said that "given the healing power of music, I knew something positive could result with the song's release."
"P2P users routinely employ file-sharing technology to acquire entertainment media. It's gratifying to see so many using it to tap into their generosity as well," commented Les Ottolenghi, President of DCIA Member INTENT MediaWorks.
"We expect additional industry participation over the coming days and weeks. With an estimated 60 million P2P users in the US, the potential to help Katrina's victims is enormous," Ottolenghi added.
BitTorrent Lands $8.75 Million
Excerpted from AP Report
The creator of the popular online file-swapping software BitTorrent has lined up $8.75 million in financing from a venture capital firm in a bid to build his software into a commercial distribution tool for media companies.
Bram Cohen created BitTorrent in 2001 as a hobby after the dot-com crash left him unemployed. Since then, it has become a favorite tool for computer users to swap large files – particularly movies and other video – because it grabs bits from various computer users simultaneously as they send and receive a file. That speeds up transfers.
Cohen said the financing from Menlo Park, CA-based Doll Capital Management demonstrates the capital firm's belief that "BitTorrent will become the ideal platform for both independent publishers and the world's leading media companies."
More than 45 million people use the BitTorrent software, according to Cohen.
Report from CEO Marty Lafferty
 We commend US Senate Judiciary Chairman Arlen Specter (R-PA), Ranking Member Patrick Leahy (D-VT), Senator John Cornyn (R-TX), and Senator Dianne Feinstein (D-CA) for conducting the hearing on Protecting Copyright and Innovation in a Post-Grokster World last Wednesday.
Effective Congressional oversight of a successful transition from the pre-Grokster era to a more harmonious commercial equilibrium is critical to industry development.
Chairman Specter set the tone seeking to balance the encouragement of creativity and innovation. One of the benefits of Congressional action can be its relative lack of ambiguity. When a bill is passed, there is not an opinion and two divergent concurrences that may further cloud an issue; there is a single piece of legislation. Senator Cornyn spoke about the harms of copyright infringement.
Ranking Member Leahy stated that the Committee sees enormous potential in P2P for entertainment distribution as well as educational purposes. The technology itself is neither the problem nor can it alone be the solution to copyright infringement. A balance must be struck.
Senator Feinstein was the most direct in her declaration that file sharing either must be made legal or shut down, given that P2P activity is increasing in the wake of the MGM v. Grokster decision. US Attorney Debra Wong Yang commented anecdotally that from her experience addressing college students, she finds that virtually 100% engage in P2P file sharing.
Mary Beth Peters, US Register of Copyrights, noted that the Court ruling's language closely echoed the INDUCE Act, and that it should be given a chance to work in the lower courts, while Congress should consider reforming Section 115 of Copyright Law to improve the efficiency of licensing musical works in the digital realm. The DCIA has pledged to lend its support to this effort.
Recording Industry Association of America (RIAA) President Cary Sherman said that the music industry is not currently seeking new legislation.
Consumer Electronics Association (CEA) President & CEO Gary Shapiro observed that Congress has already done a great deal to support the interests of copyright owners, and expressed concern that technological innovation will be stifled by the Grokster ruling, which is in opposition to the interests of both consumers and entrepreneurs.
Stanford University law professor Mark Lemley argued that it is important to protect innovation as well as copyright. He made four recommendations: 1) make it easier to target direct infringers; 2) make it easier to clear digital content rights; 3) don't impose technology mandates on companies; and 4) don't give legitimate technology companies additional problems.
SNOCAP COO Ali Aydar said consumers want "access to whatever, wherever, whenever," and we need to find ways to satisfy that, for example by authorizing the estimated 25+ million music tracks available on P2P versus the less than 2 million offered by centralized download stores.
Finally Sam Yagan, President of DCIA Member MetaMachine, confirmed that his company has agreed to comply with RIAA requests to modify eDonkey. He also voiced concerns about marketplace response to such conversions of commercial open P2P software applications to music-industry-sanctioned closed P2Ps. He is troubled that this will fuel development of open-source globally distributed P2P applications beyond US jurisdiction.
For our part, in addition to supporting the sanctioned models, which represent a milestone in cooperation between entertainment and P2P interests, the DCIA is also taking steps to support previously described "per-file" protection and monetization, intended to ensure that individual copyrighted works can continue to be profitably redistributed as the online environment evolves in the way that Sam envisions.
Our greatest challenge may be to convince major entertainment companies that this approach is worthy of their support, and we respectfully ask for their collaboration in these efforts.
Lawmakers and panelists concluded by indicating interest in promoting one-stop, third-party copyright registries – such as that offered by SNOCAP – to amass terms of distribution from copyright holders and make them available to online retailers, alleviating the burdens of brokering large numbers of individual deals.
The DCIA has long supported this approach with the work of Members such as RightsLine, and will further encourage it as a critically important part of forthcoming viable solutions.
No Need for Piracy Bill Industry Says
Excerpted from AP Report by Jennifer Kerr
The recording industry and copyright experts urged Congress on Wednesday not to intervene with legislation to curb online infringement of music or movies after a recent ruling from the Supreme Court.
At Wednesday's hearing, Senate Judiciary Committee Chairman Arlen Specter said language in the ruling cast doubt on what the standards are, and asked whether legislation might be necessary.
The overriding answer from the two panels representing the recording industry, copyright experts, and entrepreneurs was "no" – at least in the short term.
"My own preference would be to see how courts deal with this decision at this point in time," Mary Beth Peters, register at the US Copyright Office, told the committee. The recording industry also encouraged lawmakers to wait.
Prior to the Grokster ruling, entertainment companies estimated that online infringers traded 2.6 billion songs, movies, and other digital files each month.
Capital Pros Net Supports Centale
Capital Pros Network announced last week that it has formally engaged DCIA Member Centale (Pink Sheets: CNTL) for business planning, strategic consulting, and capital formation services.
Centale has created powerful technology that delivers multi-media to desktops around the world. Centale has a diverse product line and has recently contracted with Forbes.com to deliver the Market Fragger, a real time, keyword programmable, comprehensive news and stock alert that will be the first platform of its kind to run on PC, MAC, PDA, cell phones, and WAP.
Centale has browser technology, media plug-ins, and over 450 industry specific websites it will be developing utilizing this technology. Additionally, the company's online music download technology has also been accepted as a Microsoft plug-in.
"We believe Centale will be a true first mover. This is a new and exciting technology company that is being supported by major corporations and organizations," said Jonathan Pappie, President of Capital Pros Network.
"If you look at the technology closely, and the number of markets where it can be applied, you're talking about millions of dollars of revenue. I haven't seen anything with this much potential in a very long time," said Pappie.
DPPI Chooses Softwrap
DCIA Member Softwrap, a leader in digital rights management (DRM) last week announced that it is working with Data Presentation Products Inc. (DPPI), the creators of Xcelerator products for Excel and SmartList, which provide business managers with the advanced automation tools needed to access, analyze, and communicate critical corporate data, facilitating strategic and day-to-day business decisions.
Softwrap is providing DPPI with its latest industry leading encryption technology combined with a robust integrated ecommerce solution.
DPPI's products utilize Softwrap's unique out-of-application purchase solution. The out-of-application purchase allows the end-user to purchase, download, install, and then run the software without ever having to enter an activation code. Trials seamlessly convert to full versions upon purchase without requiring additional registration by customers, thereby resulting in high conversions.
Dylan Solomon, a spokesperson for Softwrap commented, "DPPI has come a long way in a short time. Xcelerator for Excel is a must-have for anyone who needs to manipulate, format, and analyze data in Excel worksheets, charts, and pivot tables. Softwrap is excited to be working with such a professional company backed by people with a passion for perfection."
Direct Revenue & Sharman Networks
Excerpted from eWeek Report by Paul Roberts
Advertising software company Direct Revenue will bundle its product with the Kazaa peer-to-peer (P2P) client. Direct Revenue will offer the Kazaa P2P technology as a free software download to consumers who agree to view a small number of relevant advertisements per day.
Under a heading "What you agree to install," users are informed that Kazaa is a free download supported by advertising from a number of adware applications, including Direct Revenue's "The Best Offers."
In a separate step, users must also click to acknowledge that they have read and agreed to the Best Offers Privacy Statement and License Agreement, which states that the software "will collect information about Web sites you access and will use that information to display ads such as pop-ups and search results on your computer while you surf the Web."
"This looks like a move in the right direction," said Alex Eckelberry, President of Sunbelt Software, an anti-spyware software vendor.
Eckelberry said that Direct Revenue's bundling arrangement with DCIA Member Sharman Networks puts the company in line with competitors like WhenU.
Ari Schwartz, of the Center for Democracy and Technology (CDT), said Direct Revenue would distribute the Best Offers software mostly through new software products, and that the company was investing in research and development.
The Kazaa relationship "makes more sense," Schwartz said.
Schwartz, who heads up the CDT's Anti-Spyware Coalition, said that Direct Revenue is improving its practices.
Visionary Strategies' Brand Report Cards
Kathie DeChirico, President and Chief Strategy Officer (CSO) for DCIA Member Visionary Strategies spoke last week at the annual AAPN Meeting about "Building Your Brand".
"Brand Report Cards" were handed out to participants for them to fill out and grade themselves from 0-100. The report cards were a real eye-opener for much of the audience. Branding and marketing report cards can be downloaded from Visionary Strategies website.
Around one hundred executives attended the annual meeting where they received inside information on the latest market trends of finance, logistics, and product placement.
Visionary Strategies is a brand management and licensing company specializing in corporate and marketing strategies. With over 25 years of hands on experience in the retail and wholesale fashion sectors Visionary provides a one of a kind approach to branding.
Fun Video Games Art & Photography
Excerpted from Joystiq Report by Vladimir Cole
DCIA Member DeviantART is an "online art community" dedicated to viewing and discussing images, some of them artful, some of them awful.
Spend some time on the site using the right keyword searches and you'll discover all sorts of great images, from next generation gamers to a comic of a PS2 "fanboi" caught in flagrante dilecto with an Xbox, to scary, hitman-inspired self portraits to strange self-referential "cosplayers" playing the games they're pretending to be from.
Please click here for a search on keyword "Video Games" yielding nearly 8,200 results.
Parents Learn to Manage Media in Kids' Lives
Excerpted from Oregon Live Report
Jerold Block, Founder of DCIA Member SMARTguard Software, keynoted a workshop last week sponsored by the Oregon Psychoanalytic Center, a nonprofit educational organization whose mission is to enhance psychological growth and emotional well-being.
He talked about solutions to inappropriate computer games and Internet abuses. SMARTguard Software helps parents monitor and control their children's access to new media.
The panel was moderated by Lee Shershow, chairman of the psychiatry department at Providence St. Vincent Medical Center and president of the psychoanalytic center. "These are things all parents struggle with," Shershow said.
P2P Marketing – What's the Big Idea
Excerpted from Financial Express Report by Lalitha Srinivasan
"Connect with consumers in every possible way" seems to the mantra of advertisers today. And if they haven't got the right connection yet, peer-to-peer (P2P) marketing could be the way to it.
Explains Ravi Kiran of Starcom Worldwide, "It's all about enabling happy customers to become advocates of brands. We've used word of mouth for advertising before. Here, we use peers to recommend a particular brand to others."
P2P offers tremendous credibility - of the kind that advertising can't buy. Says Kiran, "In research done by two of our clients, respondents said they first heard about the product from someone who has used it rather than from formal advertising." The thing to note is that peer recommendation has always been around. Remember the number of times you've watched a movie or bought a book on the insistence of a friend or relative?
"With product parity and media fragmentation traditional ways of addressing consumers are becoming less and less effective," says a Delhi-based media analyst. "At times advertising is looked upon with suspicion because it is paid-for communication. In such a scenario, marketers are looking at regular consumers to become potential brand ambassadors."
Through this technique, advertisers can create a network of believers. In the final analysis, marketing techniques are driven by the overall business model and strategy. The single metric for choosing a marketing technique should be the cost of acquiring new customers/consumers and retaining existing ones. And if P2P serves that purpose, so be it!
Giving Start-Ups a Leg Up for a Slice of the Pie
Excerpted from New York Times Report by Lisa Napoli
The "aha" moment came for Hal Bringman in 1999 when the online music pioneer MP3.com went public and its value soared, for a time, to nearly $7 billion - making millionaires, at least on paper, of its founder and investors.
"We saw them all get rich," said Mr. Bringman, who with his partner, Phil McGovern, created the public relations strategy for the company, which was later acquired by Vivendi Universal. Mr. Bringman wanted to be on the inside of such moneymaking ventures. In 2001, Fabrice Grinda asked him to handle public relations for the start-up company Zingy, the provider of downloadable ring tones, in exchange for a percentage of the business. Mr. Bringman leaped at the chance.
When Mr. Grinda sold his business for $80 million to the Japanese company ForSide, Mr. Bringman and Mr. McGovern received a handsome payoff, "making a lot more than if they'd taken fees," Mr. Grinda said.
Generally, outside public relations companies are paid by monthly retainer. But in a nod to venture capitalists that finance many of the businesses that Mr. Bringman works with, he recently formalized the concept of taking equity in a company in exchange for his services by creating a new business and calling it New Venture PR.
Technology companies not flush with cash, operating outside the corporate mainstream, particularly suit his style. He is working with several companies involved in podcasting, which is barely a year old and has attracted pioneers eager to turn it into cash.
Brad Zutaut is an entrepreneur who is starting his second company, Pod2Mob, which creates software allowing users to download podcasts to cell phones. His last venture, Xingtone, made software that let users transfer ring tones from the Internet to cell phones. After an investment by Siemens last year in Xingtone, Mr. Bringman and Mr. McGovern benefited financially, too.
Coming Events of Interest
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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.
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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.
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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.
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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.
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TELECOM '05 – Venetian Conference Center, Las Vegas, NV, October 23rd–27th, TELECOM '05 brings buyers and sellers together, in one place and at one time, to explore the full potential that the future offers our integrated communications industry. The DCIA presents "Next Generation Peer-to-Peer – Where do Telcos Fit In?" looking at the ecosystems that have evolved to make P2P the content distribution system of the 21st century.
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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.
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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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