April 24, 2006
Volume 13, Issue 2
Seamless P2P Advances Phenom
DCIA Member Seamless P2P has achieved a major milestone, the completion of a functional user interface and chat client, leading up to the launch of Phenom 3.0.
Phenom is the company’s peer-to-peer (P2P) virtual private network for Wi-Fi networks, LANs, and WANs that provides chat, peer-mail, file transfer, and remote PC control applications. Phenom utilizes public-key authentication and encryption using the 128-bit Advanced Encryption Standard (AES).
This milestone is the last before commencing Phenom’s beta testing in two months with deployment in June 2006.
Work on the user interface (UI) has gone forward and the development team is currently testing a fully functional chat client, including industry-first features such as a fully ‘What You See Is What You Get’ (WYSIWYG) P2P chat client.
At the current development point, this means that users can type in any font or style available, transmit complex text such as paragraphs, lists, etc., all within a chat session. HTML chat, images, and complex media such as video, audio, and animation are also supported within the chat window. The capabilities of the chat client lend themselves particularly well to business collaboration.
"We see this last milestone as being extremely important in Phenom’s appeal to the business market, as users can share complex documents within a session and see and edit them as they are," said Luke Rippy, President of Seamless P2P.
To receive ongoing updates on Phenom 3.0 development, product and services initiatives, white papers, and other news, please register to receive Seamless P2P News at www.slwf.net.
Centale Acquires Advanced Theory
DCIA Member Centale, an online marketing and technology solutions provider, has acquired Advanced Theory, which will enable the company to tap into the approximately 20 million Sony PSP users through its multimedia software offerings, PSP Advance Media Player and PSPRadio.
Advanced Theory recognized the potential in building Wi-Fi functionality beyond gaming and web browsing, delivering the first commercial wireless content service for the PSP in the United States.
Advanced Theory’s beta version was downloaded more than a million times, and 70,000-plus users of the beta version have indicated interest in a purchasable retail version. The PSP has the capability for a Wi-Fi function on its built-in wireless network card.
Centale increased its revenues through the quarter ending December 31, 2005 to $881,258 as reported in its recently filed 10QSB/A. This is compared to revenues of $36,200 through the end of the quarter ending December 31, 2004.
"I’m most pleased with the accomplishments we’ve made in our executable Internet and wireless product software lines. The company is strategically positioned to access target markets utilizing our 75 million person database now that we have begun our fiscal year 2007," said Jon DeYoung, Chairman & CEO of Centale.
Centale’s mission is to aggregate a massive database that can be mined demographically. The Centale database enables Centale clients, based on selected criteria, to deliver their messages through a variety of media, which are accessible via the desktop, e-mail, and wireless handheld devices.
The company intends to accomplish its mission by effectively marketing the use of its database and introducing clients to its system tray media player program, eliminating spam and delivering client specific content.
Report from CEO Marty Lafferty
 If you are even a casual reader of DCINFO, you will benefit enormously from attending the P2P MEDIA SUMMIT, our first annual Conference & Exposition.
This inaugural event is scheduled for June 22nd-23rd at the Intercontinental Holiday Inn at Tysons Corner, VA near Washington, DC.
The June 22nd Conference will feature keynotes from top P2P software distributors, panels of industry leaders, valuable workshops, and much more. There will be a continental breakfast, luncheon, and networking cocktail reception with live entertainment.
The June 23rd Exposition is being held in conjunction with the Digital Media Conference, and your registration for the full DCIA Conference & Exposition includes that event as well.
Now in its third year, the Digital Media Conference is a "must-attend" event for media, entertainment, and technology businesses, educational institutions, and government agencies involved in the digital distribution of media.
Keynote speakers for the June 22nd DCIA Conference include eDonkey's Sam Yagan, GNAB's Jan Marc Külper, and MyPeer's Les Ottolenghi.
As a result of market-share shifts among the current generation of open P2P software programs, which have demonstrated steady usage growth for more than three years, MetaMachine's eDonkey now ranks number one on a global basis, ahead of second-ranked BitTorrent.
With the recent launch of its white-label P2P platform branded as In2Movies with partner Warner Bros., GNAB, a service of the Bertelsmann Group’s arvato mobile, exemplifies the industry’s closest collaboration to-date of the entertainment and technology sectors.
And as a result of INTENT MediaWorks' unprecedented development and integration work to leverage multiple file-sharing platforms and UI configurations, as well as web-based distribution, MyPeer represents the most advanced implementation of P2P in the marketplace today.
The Jun Group's Mitchell Reichgut will present a case study on Stageside, its highly successful P2P-exclusive entertainment offering sponsored by the Coca Cola Company, which epitomizes one of the most promising business models for P2P distribution of copyrighted works.
Alston & Bird's Aydin Caginalp & Renee Brissette will conduct a special session on corporate value optimization for firms in this emerging high-growth industry.
Additional confirmed DCIA Member speakers include Clickshare's Rick Lerner, Digital Containers' Chip Venters, Fun Little Movies' Frank Chindamo, Javien's Leslie Poole, MediaPass Networks' Daniel Harris, MusicDish Networks' Eric DeFontenay, P2P Cash's Tom Meredith, P2P.com's Albe Angel, RazorPop's Marc Freedman, and Telcordia's Corey Clinger.
Live showcase entertainers for the post-conference networking cocktail reception include the Internet’s First Rock Star, Scooter Scudieri.
Exhibits and demonstrations for the June 23rd DCIA Exposition, held in conjunction with the Digital Media Conference, will feature industry-leading products and services.
Additional exciting speakers and more special sessions will be announced in coming weeks.
Don’t miss the opportunity to participate in this 2006 inaugural event. Online registration will begin this week or call 888-864-3242 now to register.
For sponsor packages and speaker information, please contact Karen Kaplowitz, DCIA Member Services, at 888-890-4240 or karen@dcia.info. Share wisely, and take care.
Fireclick’s Advanced Warehouse Suite
Fireclick, a leading provider of web analytics solutions and subsidiary of DCIA Member Digital River, has upgraded its flagship service offering. The newly updated suite and hosted application service – now called the Fireclick Advanced Warehouse Suite – caters to online businesses that are interested in learning more about the buying behaviors and preferences of their customers.
It offers online merchants more advanced reporting capabilities and built-in, time-saving features for analyzing customer segments as well as more details about the site purchase paths and navigation patterns that are generating the greatest sales conversions.
The Fireclick Advanced Warehouse Suite also is designed to work with key Digital River marketing technologies. These technologies include Digital River’s e-mail marketing solution from BlueHornet Networks and its KeywordMax paid search bid management tool from Direct Response Technologies.
"With the recent release of our Fireclick Advanced Warehouse Suite, we have added advanced features and functionality to our core web analytics engine, as well as expanded the offering to include complementary e-mail marketing and paid search bid management solutions," said Dave Alampi, Digital River’s Vice President of Marketing. "As part of the Digital River family of companies, Fireclick can deliver what we believe is the most robust web analytics suite available through a single provider."
Fireclick, a wholly owned subsidiary of Digital River, provides a comprehensive web analytics solution that offers online businesses real-time, actionable information about their customers. The sophisticated data delivered by the application service can be used to improve operating results, create a better user experience, and increase site traffic, revenues and profits. For more information, visit www.fireclick.com.
Eisner Eyes Online Video
Excerpted from Daily Variety Report by Ben Fritz
Michael Eisner is jumping into the online video space. The former Mouse House topper is taking part, along with Time Warner in a $12.5 million financing round for startup Veoh Networks through his new investment vehicle the Tornante Co.
He’s also joining the board of the netco, which is differentiating itself from competitors like YouTube and Google Video by not limiting the length of videos, letting content providers choose whether to charge or integrate ads, and allowing viewers to use preferences to create their own virtual channels.
Between the conglomerate and Eisner, Veoh will now have connections to many of Hollywood’s most powerful content companies, giving it a big leg up as it attempts to become a distributor of high-quality content via the Web.
"Veoh revolutionizes television by leveraging the Internet to expand broadcast capacity to the point that every single user, whether an individual or a media company, can create their own ‘channel’ and every ‘channel’ can be supported by its own business model," Eisner said of the investment.
"We’re fortunate to have the visibility Michael gives us, along with his connections and incredible experience," said Veoh Chief Executive Dmitry Shapiro.
Video is delivered via a proprietary P2P technology.
Veoh launched March 1st and is now serving around 1 million videos per month. It previously received a $2.3 million first round of financing from Shelter Capital Partners.
Accenture Teams with Telcordia
Excerpted from iTWire Report by Stuart Corner
DCIA Member Telcordia Technologies and Accenture have formed a strategic alliance to build and deliver end-to-end operations support, network management, and business support solutions for communications service providers globally.
Accenture will incorporate Telcordia’s OSS applications into Accenture’s suite of software for communications service providers. In addition, the two companies will offer their new solutions as preferred products to meet specific customer needs.
Accenture has also been awarded a multi-year application outsourcing contract to provide Telcordia with applications development support services.
Accenture says it will combine its global technology network, business process, and broadband experience, and industry-specific assets with Telcordia’s product portfolio "to help carriers address the challenges and reap the benefits of migration to next-generation IP networks with fully-integrated platforms enabling market differentiation and revenue maximization."
The two companies are working closely together to jointly develop, market, and deploy solutions to enable telecommunications companies to rationalize their infrastructures and reduce operational costs.
Mike Henderson, President, Global Solutions, Telcordia, said that "Accenture brings a deep understanding of the strategies and future direction of communications service providers in the broadband world. Our complementary strengths and solutions can help carriers stay ahead of the changing telecommunications market and emerge stronger than before with a more robust, profitable business strategy."
BitTorrent Gaining Acceptance
Excerpted from National Ledger Report by Chris Barylick
In the world of the Internet, a new idea can be either an asset or a threat. It depends on your perspective.
BitTorrent, the popular P2P file-sharing technology, poses exactly this conundrum to Internet service providers (ISPs) and entertainment firms alike. The technology, which allows computer users to easily share and distribute files without occupying much of their Internet connection bandwidth, is also responsible for almost one-third of the Internet’s traffic flow, according to recent estimates.
Conversely, it’s this feature that makes the technology perfect for content distribution, especially in an era when file sizes have become much larger. Video files, having become extremely popular due to increased quality and more widespread prevalence of broadband technologies, can be easily shared without bogging down a single computer, as in a traditional Internet server model.
Once a file has been downloaded, the BitTorrent program shares it out to other users working to download the file by contributing a small part of the computer’s bandwidth to help others download the file. A larger number of users downloading the same file will allow for faster speeds given that each user contributes part of their bandwidth to the overall distribution effort.
BitTorrent has been eyed as an ideal distribution model for the entertainment industry. Peter Jackson’s "King Kong," recently released to DVD, has been offered as a legal online download in the United Kingdom. Once downloaded, digital versions of a movie can be copied to a restricted number of computers depending on the rules of the file’s digital rights management (DRM) protocol.
"I think P2P technologies are starting to become more accepted," said Tim Bajarin, an analyst for Creative Strategies. "Video is a very important part of the Internet. The important factor is to get the content out there, which helps to curb piracy."
Although BitTorrent and online video content distribution may be en route to widespread acceptance, the data traffic it generates still needs to be managed. In light of the increased network traffic, network managers have had to craft new ways to control, or "shape", the data flow running through their systems. For this task, specially designed software can be programmed to identify the characteristics of outgoing data, which can be grouped into segments called "buckets."
Each bucket, once created, is assigned a priority. The software manages each bucket per the network manager’s instructions. Specific data can then be restricted so the network devotes only a certain amount of its bandwidth to each bucket.
For the home user, popular BitTorrent clients can be controlled via the application’s preferences. Simple adjustments can be made such as capping the amount uploaded to a certain percentage of the computer’s available bandwidth.
Once considered the nemesis of the entertainment industry, P2P file sharing has come a long way since the infamous days of Napster. Now a bona fide content distribution tool, BitTorrent can help push large files across the Internet through a shared effort.
Top Evangelist Chooses SVC Financial
DCIA Member SVC Financial Services, a leading provider of mobile transaction technologies, has entered into a strategic relationship with David Bibey, one of the world’s most renowned evangelists. Bibey will promote a new "Liberty Card" on his television broadcasts to millions of people around the world beginning in June 2006. The Liberty Card is a MasterCard debit card that allows users to easily and economically transfer money to anyone, anywhere in the world using a cell-phone.
Scoot Mobile Money, the unique SVC service that integrates a prepaid re-loadable debit card with a cell-phone, will power the Liberty Card. Anyone with a cell-phone can easily and securely transfer funds to friends and family in other countries using the Liberty Card. The recipient can use the card to collect the money at any participating ATM, as well as make purchases or pay bills online.
The Liberty Card is an evangelical card specifically developed for families that work with churches around the world. Bibey will promote the Liberty Card within his weekly ministry broadcast on over 3,000 television channels to over 50 million people in 55 countries. Interested individuals will be able to purchase the Liberty Card for themselves, their family, and other recipients, by dialing a 1-800 number.
"We are tremendously excited to work with David Bibey on the Liberty Card. It is a revolutionary new way for relatives to send money to missions and missionaries abroad, and every time the card is used, an additional portion is sent to charities," said Christopher Haigh, SVC President & CEO. "Scoot technology combines economical fees and the ease of using a cell-phone to conduct money transfer to even the most remote locations in the world."
Internet Video Growth Accelerates
Excerpted from Center for Media Research Brief
According to a new forecast from IDC, Internet video services will generate over $1.7 billion in revenues by 2010, an increase of more than $1.5 billion from 2005 totals. Internet video services are on the brink of becoming a mainstream phenomenon in the United States. Much of this growth will be fueled by a surge in the amount of premium content made available online.
The market for Internet video services began its dramatic acceleration in 2005 as content owners started to experiment with digital distribution as a way to complement and enhance their existing business models and to stem copyright infringement. In particular, the television networks’ decision to offer episodes from new shows as well as old sparked significant interest in Internet video.
Josh Martin, associate research analyst in IDC’s Consumer Markets: Video, said, "The Internet video market has huge upside. With that upside, however, comes the risk to content owners of cannibalizing existing revenue streams."
Key drivers for the adoption of Internet video include the expansion of premium content offerings online and the emergence of home networking solutions that allow consumers to more easily view Internet content on their televisions.
IDC expects content owners will migrate toward three basic service types: 1) advertising-based services will remain the dominant type of Internet video service; 2) a la carte services, buoyed by consumer familiarity with iTunes, will grow dramatically over the next 2-3 years; and 3) subscription-based services will experience steady growth throughout the forecast period, enhanced somewhat by the emergence of home networking solutions.
In order to sustain the momentum gathered in 2005 and maximize opportunities for success, content owners and service providers will need to overcome several important problems including licensing issues, inadequate video search, competitive challenges, and how to move content beyond the PC.
The press release may be found here, and the report is available for purchase here.
Skype on Doing Business in China
Excerpted from MediaPost Report
DCIA Member Skype, eBay’s web-based telephony company, tells the Financial Times that Tom Online, its partner in China, has filtered its text messages to be in compliance with government censorship policies. The company admitted that compliance with the laws is the only way to do business in the country. Tom Online uses a text filter, which Skype says is what everyone doing business in China uses to comply with local law.
Skype CEO Niklas Zennström said complying with Chinese law is no different from obeying rules governing business in western countries. He added, "I may like or not like the laws and regulations to operate businesses in the UK or Germany or the US, but if I do business there I choose to comply with those laws and regulations. I can try to lobby to change them, but I need to comply with them. China in that way is not different."
China is one of Skype’s three biggest markets in terms of active users, along with the US and Germany. Referring, perhaps, to the controversy surrounding Yahoo’s "over compliance" with Chinese censorship laws, as activist groups have implied in their condemnation of the firm, Zennström said Skype in no way jeopardizes its users’ privacy or security.
Judge Suggests Labels Misled US
Excerpted from LA Times Report by Joseph Menn
Evidence suggests that the major record labels misled the Justice Department when they persuaded it to drop an antitrust probe of the music industry, a federal judge has ruled in a related San Francisco case.
In 2001, prosecutors began investigating whether the labels had conspired to fix the terms for distributing digital music through two jointly owned services, MusicNet and Pressplay. The officials were concerned that the five big labels were colluding to discourage people from downloading popular music in an attempt to protect CD sales.
The probe was dropped in December 2003, when the Justice Department found that MusicNet and Pressplay used separate management and other safeguards to prevent the labels from improperly learning the practices of their competitors.
But the Justice Department’s decision was influenced by two detailed "white papers" — one submitted by EMI Group and MusicNet, the other by Universal Music Group and Pressplay. In a ruling made public Friday, US District Judge Marilyn Hall Patel found that those papers were "deliberately misleading."
Patel ruled in a dispute over what documents EMI and Universal should be forced to turn over in a long-running copyright lawsuit about Bertelsmann’s investment in Napster. That suit centers on whether Bertelsmann, which also owned the BMG label, improperly helped users of the song-swapping service infringe copyrights.
Bertelsmann’s co-defendant and fellow Napster investor, Hummer Winblad Venture Partners, has filed a counterclaim arguing that the other labels broke antitrust and copyright laws by refusing to license music to Napster on reasonable terms while using the heavily restricted music available on MusicNet and Pressplay as a smokescreen.
Steve Jobs Wasn’t Lying
Excerpted from TechDirt.com Report
It’s the story that just won’t die. Two years ago, the record labels started making noises about how they wanted variable pricing for songs on iTunes. Steve Jobs immediately made it clear that Apple wasn’t interested. A year ago, the same story popped up and again, Apple said it was news to them. Last summer, the labels started saying it again, leading to Steve Jobs to flat out call them "greedy."
Meanwhile, many of us were wondering how these statements weren’t the equivalent of price fixing. Just a few years ago, the labels all got in trouble for telling retailers how much CDs should cost – which is illegal price fixing.
It appears the labels (even post-fine) don’t seem to get this. They also don’t seem to get that Steve Jobs is serious about keeping the price at a dollar. Just as the original iTunes contracts are set to expire, the labels which were all confident that Jobs would back down and allow variable pricing are suddenly discovering he’s not budging at all.
In fact, they’re finally starting to recognize that for all their bluster, Steve Jobs is the one who has the power in this relationship – as none seem willing to actually pull their songs off of iTunes. Of course, some of the execs continue to be totally clueless.
The article quotes one unnamed music exec who is upset that the labels didn’t "stand up to Jobs." He then says: "Where in life does the retailer set the price of the content?" Isn’t that exactly what the lawsuit and the fine in 2002 were all about? The labels can wholesale their music at whatever price they want – and then Apple (the retailer) can do whatever it wants in response – just as record stores get to set the retail price for the CDs they sell. If the labels are so upset, then why don’t they set their own variable pricing and see what Apple does in response?
Media Revolution: Small Audiences
Excerpted from MediaPost Report
Its prose is sometimes turgid and its art old-fashioned, but The Economist rarely misses when it decides to weigh in on a Big Trend.
That’s the case this week when the British-based weekly ran a piece by Andreas Kluth about the transformational powers of high-speed broadband, saying its advent represents a true revolution in the way the people of our planet communicate.
Kluth’s main point is that, unlike previous eras in the annals of communication, in which power resided with owners of the machinery, the Web era is quickly becoming all about its participants.
"This has profound implications for traditional business models in the media industry, which are based on aggregating large passive audiences and holding them captive during advertising interruptions," Kluth wries.
"In the new-media era, audiences will occasionally be large, but often small, and usually tiny. Instead of a few large capital-rich media giants competing with one another for these audiences, it will be small firms and individuals competing or, more often, collaborating.
Some will be making money from the content they create; others will not and will not mind, because they have other motives.
‘People creating stuff to build their own reputations’ are at one end of this spectrum, says Philip Evans at Boston Consulting Group, and one-man super-brands such as Steven Spielberg at the other."
This is a fascinating (to some industrialists, no doubt disturbing) and altogether worthwhile summary of a hugely important trend.
Coming Events of Interest
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LWNW Canada 2006 – April 24th-26th in Toronto, Canada. LinuxWorld & NetworkWorld (LWNW) Canada Conference & Expo 2006 is "Where the IT Industry Meets!" and the number one marketplace for management and IT professionals to interact and learn about the newest applications and solutions and see demonstrations of leading information technology based products, services, across all computer platforms. Exceptional educational programming, dynamic keynotes, case studies, tutorials, and hands-on labs provide valuable information demonstrating real-life applications and solutions.
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Games & Mobile Forum – April 25th–26th in New York, NY. This year’s topics include: Games & Mobile Innovations from Around the World; The Business of Casual Downloadable Games; Mobile Games: The State of The Industry; Online Games: The State of The Casual Games Industry; Portability & Brands: Strategies for Multi-Platform Content Development & Brand Integration; Advertising in Games; International Games & Mobile; and Brands Going Mobile.
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First Annual DCIA Conference & Expo – The first-ever global P2P MEDIA SUMMIT will cover policy, marketing, and technology issues affecting commercial development of this emerging high-growth industry. June 22nd-23rd at the Intercontinental Holiday Inn, Tysons Corner, McLean, VA. Exhibits and demonstrations will feature industry-leading products and services. Alston & Bird’s Aydin Caginalp & Renee Brissette will conduct a special session on corporate value optimization for firms in the distributed computing industry. For sponsor packages and speaker information, please contact Karen Kaplowitz at 888-890-4240 or karen@dcia.info. DCIA Members Music Dish Network and Javien are our media and e-commerce partners respectively. Plan now to attend.
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Washington Digital Media Conference – June 23rd at the Ritz-Carlton, Tysons Corner, McLean, VA. DCIA Conference & Expo attendees can attend this executive briefing on emerging business, policy, and technology issues & opportunities at half-price. This is a must-attend event for media, entertainment and technology businesses, educational institutions, and government agencies involved in the digital distribution of media. The Washington Post calls the event: "a confab of powerful communicators and content providers in the region."
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