May 21, 2007
Volume 17, Issue 10
P2P MEDIA SUMMIT LA Coming Soon
Please sign-up now for P2P MEDIA SUMMIT LA & Digital Hollywood Spring (DHS) – kicking off June 11th.
The P2P MEDIA SUMMIT LA is a must-attend event for content creators and rights holders, application developers and distributors, solutions providers and service-and-support companies – and all others interested in profiting from the realization of the exploding and multi-faceted P2PTV, social networking, user-generated content (UGC), and file-sharing marketplace.
To reserve your room for P2P MEDIA SUMMIT LA & DHS at Doubletree Guest Suites Santa Monica, please call 310-395-3332 today with the booking code "P2P MEDIA SUMMIT." Your rate will be $219 + tax per night for a 2-room king suite, high-speed Internet included. Doubletree Guest Suites are ideal for accommodating your private business meetings while at these events.
Please click here for the full agenda, here for a list of speakers, and here to register. Don’t miss the P2P MEDIA SUMMIT LA.
The P2P Mistake at Ohio University
Excerpted from Op-Ed by Ashwin Navin, COO & Co-Founder, BitTorrent
Ohio University recently informed students that the use of peer-to-peer (P2P) technology has been banned from the campus computer network.
By instituting this ban, Ohio University has demonstrated a serious lack of understanding of P2P technology’s value and role on the Internet. Furthermore, the school has closed its doors to innovation and shirked its responsibilities as an educational institution.
Music file-sharing is only one application of P2P technology. It has been applied in many compelling ways – as a mechanism to make voice calls over the Internet with services such as Skype, to enjoy popular TV shows when on the go or away from the TV, and to solve problems that enterprises face in their computer networks.
Many artists, along with budget-conscious organizations, depend on P2P to reduce the costs of publication on the Internet. P2P technologies like BitTorrent are being used by independent software developers, entities like NASA and PBS, and countless musicians and filmmakers, to move large files faster and more efficiently than through older centralized server-client technologies.
Major Hollywood studios, like our partners 20th Century Fox, MTV Networks, Paramount Pictures, MGM, and Warner Bros. are now licensing their content for distribution via P2P technology.
Within P2P lies a much-needed fix for the Internet itself. The way we use the Internet today – to stream videos, to make VoIP calls, or to download software and video games – is actually taxing the capacity of our networks and servers beyond their design.
According to a recent study by Deloitte, video traffic alone is stretching the Internet to its limits and the current growth rate will lead to serious congestion problems.
P2P can help. One of the original designers of the Internet, Vint Cerf, agrees that the best way to alleviate the stress on the central backbone of the Internet is to decentralize the onus of distribution to a local level using P2P – specifically with a BitTorrent-like architecture.
BitTorrent reduces the dependency on a central web server by accumulating the available bandwidth and computing capacity that lives on the users’ PCs. As a result, websites and the Internet can run more efficiently.
If P2P is like a hybrid car, BitTorrent is the Toyota Prius. Although it doesn’t eliminate the need for gasoline (that is, central web servers), BitTorrent can often provide more than 1,000 times the "fuel efficiency" relative to the old-fashioned way of driving the Internet, which has been dependent on a lot of central resources.
The smart money is betting on P2P. Companies that offer traditional, centralized Internet infrastructure are increasingly adopting P2P to tap its efficiency when managing the delivery of large, popular files that strain central servers.
BitTorrent technology is a natural addition to the content delivery network (CDN) market. Industry heavyweights are also getting in on the action: Akamai Technologies last month purchased P2P company Red Swoosh, and VeriSign last year scooped up major P2P developer Kontiki.
BitTorrent, the company, does not support copyright infringement. In fact, it is our biggest competitor and the most significant challenge to making our company profitable. P2P isn’t the enemy. Narrow-minded policy that thwarts innovation is.
Report from CEO Marty Lafferty
 We are very pleased this week to announce our morning agenda for the upcoming P2P MEDIA SUMMIT LA. We will announce the afternoon agenda in DCINFO next week.
This second annual DCIA Los Angeles Conference & Exposition is being held in conjunction with Digital Hollywood Spring (DHS), and is scheduled for June 11th–14th in Santa Monica CA.
Our focus will be on P2PTV, the industry’s newest high-growth phenomenon.
P2PTV refers to video distribution on the Internet using P2P technologies.Many DCIA Member companies now offer solutions to help content rights holders, ISPs, client applications, and other participants in this rapidly emerging distribution channel, accomplish this at astonishingly low costs and with astoundingly high quality of service (QoS).
The P2P MEDIA SUMMIT LA will take place at the Doubletree Guest Suites Santa Monica. A continental breakfast will be served in the Carousel Ballroom starting at 8:00 AM. Karen Kaplowitz, DCIA Member Services leader, and I will offer a welcome, industry overview, and introductions at 8:30 AM.
The POLICY TRACK will start at 8:45 AM and address "The Post MGM v. Grokster World – New Rules for P2P." As consumer lawsuits and corporate litigation settlements continue in the wake of the MGM v. Grokster decision, what other changes in the regulatory environment affecting P2P technologies do they presage? What will be the impact of the most recent court opinions with respect to continuing advancement of P2P? What else has to happen from a legal and policy standpoint to foster new investment and robust commercial development of P2P?
Panelists will include Joshua Wattles, Of Counsel, Entertainment Department, Dreier LLP; Steve Masur, Managing Partner, MasurLaw, either Fritz Attaway, EVP & Washington General Counsel, or Dean Garfield, VP and Director, Legal Affairs, Worldwide Anti-Piracy, the Motion Picture Association of America (MPAA); Ted Cohen, formerly EVP, EMI Music, and now Managing Partner, TAG Strategic; and Ray Beckerman, Partner Vandenberg & Felieu. Our moderator will be Elaine Reiss, DCIA Best Practices leader.
Les Ottolenghi, President, INTENT MediaWorks, will be our opening keynote speaker at 9:30 AM. Les has over 20 years of experience as an entrepreneur in start-ups and as an executive in Fortune 500 companies. As Co-Founder of INTENT, he has built a company that is the industry leader in P2P media distribution. Les advised the White House in March 2005 on business models for P2P and has testified before the Federal Trade Commission (FTC) regarding authorized content distribution via P2P. INTENT was the only company cited in the US Supreme Court’s MGM v. Grokster decision as a positive example of P2P utilization for licensed entertainment marketing.
Todd Johnson. Chief Marketing Officer (CMO), VeriSign, will keynote at 9:45 AM. A 22-year Silicon Valley veteran, Todd has extensive experience leading companies ranging from start-ups to multi-million-dollar technology companies, overseeing the direction of business development, strategic alliances, sales, and infrastructure operations. Prior to his current role at VeriSign, Todd served as CEO of Kontiki, an industry pioneer in P2P video delivery, subsequently leading the company to its acquisition by VeriSign. Before Kontiki, he was president of Jamcracker, which provides software and services that enable companies to manage on-demand delivery.
At 10:00 AM, we will have a refreshment and networking break.
The TECHNOLOGY TRACK will start at 10:30 AM and address "P2P File Sharing – The Evolving Distribution Chain." What is the current landscape for web-based content distribution and what role do file-sharing technologies play? What trends are emerging in P2P implementation by participants in the distribution chain and in consumer usage? What impact do advances in digital rights management (DRM), data compression, caching, content acceleration, swarming, streaming, and other P2P-related technologies have?
Panelists will include Michael King, CEO, Abacast; Eric Garland, CEO, DCIA industry data resource BigChampagne; Andrew Parker, CTO, CacheLogic; Frank Childs, VP, Business Development, PeerApp; and Tom Wilder, CEO, PodZinger. Our moderator will be Limor Schafman, newly appointed to DCIA Member Services.
Erik Lumer, CEO, Babel Networks, developer and distributor of Babelgum, will be our keynote speaker at 11:15 AM. Erik leads the company’s product, marketing, and business development. Prior to founding this up-and-coming P2PTV service, Erik spent several years in strategy consulting for leading IT and telecommunications companies in Europe and the US, and participated in start-up ventures in Silicon Valley. Early in his career, Erik did pioneering research in distributed computing and collective intelligence at the Xerox Palo Alto Research Center, the Neurosciences Institute and University College London. Erik holds a Ph.D. from Stanford University.
Janko Röttgers, special analyst of Joost for the DCIA and creator of the P2P Blog, will be our keynote speaker at 11:30 AM. Janko has been covering the P2P entertainment revolution since 1999 from the points of view of business, technology, and culture. Most recently, he has focused on P2PTV, and is a regular contributor to NewTeeVee, De:Bug magazine, OE1 ORF, the Frankfurter Rundschau newspaper, Zeit.de and other print, online and radio outlets. Janko is the author of the book "Mix, Burn & R.I.P. - Das Ende der Musikindustrie" published in 2003. In 2001, he co-edited "Netzpiraten - Die Kultur des elektronischen Verbrechens" with Armin Medosch.
The MARKETING TRACK will start at 11:45 AM and address "Business Models – What’s Working and What’s Not." Has any alternative business model – paid-download, subscription, or advertising-supported – yet proven to be more promising than adware that first predominated in P2P? Is file sharing more of a promotional tool than a direct sales channel? Have any more innovative approaches been attempted and what has been the learning? How can users navigate among entertainment industry sanctioned P2P service offerings?
Panelists will include Leslie Poole, CEO, Javien Digital Payment Solutions; Jonathan Lee, Director of Business Development, MediaDefender; John Desmond, VP, MediaSentry Services, SafeNet; Ed Kozel, CEO, Skyrider; and Dana Jones, CEO, Ultramercial. Our moderator will be DCIA Business Affairs leader, Sari Lafferty.
Our Conference Luncheon begins at 12:30 PM. Details will be announced shortly.
A highlight of this summit will be the afternoon closing session on "DRM INTEROPERABILITY." Representatives of BUYDRM, Coral, Digimarc, Entriq, and the MPAA will discuss the next frontier – business practices and open standards. What are consumers seeking in terms of DRM interoperability? What different models are envisioned to achieve DRM interoperability, and what industry efforts should go on in this space? How can participants in the P2P distribution channel contribute?
Our live entertainer for the post-conference networking cocktail reception, courtesy of Nettwerk Music Group, will be Shotgun Honeymoon.
Other P2P MEDIA SUMMIT LA sponsors include FTI Consulting, INTENT MediaWorks, Altnet, and Javien Digital Payment Solutions.
For more information, please visit www.dcia.info/P2PMSLA2007.
Early registration rates, which save attendees up to $250, end June 1st. To register, please visit www.dcia.info/P2PMSLA2007/register.html or call 410-476-7965.
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.
CacheLogic Upends CDN Business Model
CacheLogic, a global provider of content delivery solutions, this week announced a unique, configurable class-of-service solution allowing customers to deliver content cost-effectively and with sustainable quality of service (QoS) anywhere in the world.
The new CacheLogic VelociX CDN upends the traditional "one-size-fits-all" per Gigabyte model employed by 1st-generation CDNs. VelociX offers savings of up to 50% while simultaneously allowing variable delivery speeds and cost controls on a per-asset, per-user basis.
"VelociX enables CacheLogic customers to achieve a global footprint with superior performance compared to first-generation solutions," said Andrew Parker, Chief Technology Officer (CTO) for CacheLogic. "We are very excited to be offering this industry-first capability to fine-tune content delivery to enable new services for the content owner and improved user experience for end-users – the need to offer configurable services is long-overdue to the market. This new delivery structure serves notice to the industry that there are better alternatives than flat business models."
As opposed to flat undifferentiated delivery models, VelociX enables different service levels to be assigned to different traffic or end-users. Rather than having a single price and performance for all traffic, this solution allows for a unique delivery speed and cost to be assigned to each asset. Content requiring high performance can receive the needed bandwidth, while assets can also be configured for low-cost delivery that can be dynamically modified to fit user-demand and infrastructure. CDN customers save on the total cost of content delivery – all while ensuring in-demand assets get the performance and service level they require.
In addition to cost benefits, class of service solutions enable CDN customers to differentiate their online services and enable new sources of revenue that are not possible with today’s approaches. By allowing different delivery techniques to be applied to the various stages of a digital asset’s life cycle, assets can be most effectively monetized. Creating targeted delivery services to end-users is finally possible – enabling ‘up sell’ to premium service offerings. Allowing end-users to dynamically select delivery and associated payment approaches or service class on a delivery-by-delivery basis is also achievable with VelociX.
CacheLogic CTO Andrew Parker will be a featured speaker at P2P MEDIA SUMMIT LA.
P2P, Streaming, CDNs – What Will Really Work
Excerpted from NewTeeVee Report by Paul Kapustka
Is P2P technology on the verge of radically changing the content-delivery marketplace? And if so, what does that mean for both content producers and content delivery networks – more opportunity, or threatened business models, or both all around?
While there’s no single news nugget to point to emphatically, a series of recent announcements, posts and observations all seem headed in the direction of a big collision between traditional CDNs, P2P technology, and streaming video. Out of the pile-up, we see the following questions that don’t yet have clear answers.
What happens to the traditional CDN business when P2P is added to the mix? According to this week’s news from CacheLogic, it means more flexibility and cheaper pricing for content providers. Akamai last month bought its own P2P play, Red Swoosh And how do BitTorrent and upstart Neokast fit into the equation?
Does a combination of CDN and P2P solve some of the quality-of-service issues many service providers were predicting that heavy video use will bring? If so, what happens then to AT&T’s and Verizon’s IPTV business models, which were built somewhat on the idea of being able to charge premiums for faster video delivery?
When will Google and Cisco flex their considerable infrastructure muscle to take even more advantage of the growing demand for online video? On Wednesday, Google took one step in that direction by making video search part of its powerful first page of results.
Cisco, meanwhile, confirmed its intentions this week to offer such networking services. What does that mean to all its service-provider customers?
What are the new business models that better content delivery technology could enable, beyond Joost, Justin.TV, and Ustream?
FoxTorrent Software Update
The FoxTorrent team has released an update to its Firefox extension that adds a BitTorrent-like client to the popular web browser. FoxTorrent v1.10 fixes a problem that has troubled users of "particular" Torrent sites, according to the team. FoxTorrent enables speedy downloads of public-domain music, video, photos, software, and other files from within the Firefox browser, according to the project. The Firefox extension lets users play streamable media (MP3s, MPGs, DivX, AVIs) moments after the download begins, according to the project.
FoxTorrent v1.10 "fixes the problems a lot of people are having with downloading from particular Torrent websites. Now it should work with every Torrent website," a team spokesperson said on the project wiki.
Users can download FoxTorrent in Firefox’s Download Manager and manage their torrents from within Firefox, the spokesperson said.
FoxTorrent can be used with all Linux, Windows, and Mac OS systems. Information on how to download and use FoxTorrent is available on the project’s website, here.
Joost Adds Indy Racing Content
Excerpted from Mashable Report by Kristen Nicole
Joost has added Indy racing to the content that will be made available with its upcoming P2PTV service.
The IndyCar Series and Indianapolis 500 announced today that they will provide their content on their own IndyVision channels on Joost, including IndyCar Races, Indy 500 Films, and exclusive IndyVision programming. Content on both channels will be available on-demand with Joost’s programming options. With this deal, IndyVision has the chance to provide the on-demand features that sports fans have requested, as well as a broadened opportunity to find new potential fans.
IndyVision expects to add more channels to Joost in the near future, including the IndyCar Series and the Indy Pro Series, highlighting shows like Hardest Hits, Up to SPEED and LIFE in the Fastlane. This also opens Indy racing to fans that wish to chat and share the programming they will provide through Joost, which will improve branding and incorporate community and social networking around Indy racing.
Joost continues to partner with content providers and brands in order to offer a wide array of programming for free to users. These deals include CBS among other major networks, and several indie film studios, not to mention their round up of 32 companies anxious to advertise on Joost. Joost has also recently announced the culmination of $45 million in funding.
What’s OMEMO
Conceptually, OMEMO is a virtual storage device. The OMEMO software creates a P2P network that brings together the available free space on the hard drive donated by each user, to create a unique and immense virtually limitless drive. The resulting storage unit will appear accessible in each user’s system as if it were the local hard drive, a CD, or a pen drive, with access speeds higher than those of an FTP server.
Working anonymously, the drive enables users to add and organize their own content, which will form part of a live multimedia library managed by the users themselves.
Watching TV, But Not on TV
Excerpted from eMarketer Report
Over a quarter of males aged 13-to-34 watch video on devices other than TVs, according to E-Poll's Multi-Platform Viewing of Video Content report.
The study of viewing habits in 2007 found that 75% of consumers aged 13 and older viewed video content on PCs; 46% on their laptops; 16% on their portable video players; 13% on their iPods; and 13% on their mobile phones.
Over half of those who watched video content online said they were interested in transferring it to their television sets. Only 13% of television viewers said they had already made such a transfer. Half didn’t know it was possible.
The idea lost its charm when prices were mentioned.
About half of TV viewers said they would like to be able to transfer online video to their TVs, but only 17% would pay $100 or more for a device.
On the other hand, nearly a third said they would still be interested, even if it required a complicated installation.
One reason more people are moving their TV viewing to other devices is availability. More people have video-capable devices, making it convenient to watch video even if the viewer is not at home.
Young teens are especially gadget-rich. Over half of boys and girls ages 12 to 14 owned and used a computer, TV, VCR, DVD player and mobile phone on a regular basis, according to a Los Angeles Times and Bloomberg survey.
Watching TV on different devices and sending video to TVs has gained appeal in the last year. Credit goes in part to online video services like Amazon Unbox and AppleTV.
Respondents to the 2007 E-Poll survey were more interested in such activities than those surveyed by the LA Times and Bloomberg.
Many respondents in that study said they would not want to watch a TV program on a device other than a TV, and the feeling was especially strong among young males. Nearly half of boys ages 12 to 14 were not interested, although girls in that same age group were more open to the idea.
"Things are changing quickly, and it’s likely that the teens surveyed by E-Poll this year are much more familiar with the various ways they can watch video," said eMarketer Senior Analyst Debra Aho Williamson. "In fact, I believe that young people will expect to be able to watch TV anywhere, anytime. It will be a part of their everyday life, just as mobile phones are today."
Learn how teens juggle media. Read the eMarketer Tweens and Teens Online: From Mario to MySpace report.
Skinkers & Microsoft at SME
At Streaming Media East (SME), Skinkers joined Microsoft on stage for the opening keynote presentation.
Skinkers LiveStation integrates Microsoft Silverlight with Skinkers P2P technologies to set a new standard for cost effective and scalable delivery of quality live video content over the Internet. >From small to large audiences, Silverlight and LiveStation deliver a high quality user experience built on the first viable P2P technology for live streaming.
Matteo Berlucchi, CEO of Skinkers, said, "Internet broadcasting is without doubt the most exciting innovation in broadcasting since satellite and cable television. For content owners there is clearly a market for the many video-on-demand (VOD) providers currently emerging, such as Joost, but there is an enormous demand to stream live TV-like experiences to the desktop, from the narrowcast end of the spectrum right through to very large audiences for must-see events."
"Current streaming techniques require expensive infrastructure demands to serve relatively small audiences. The start-up cost for the narrow audiences is too high, and for the larger audiences the cost becomes prohibitive because of the issues of infrastructure scalability. With Skinkers LiveStation, broadcasters can reach small audiences very cost effectively, but can also scale up to very large audiences for a fraction of the cost while guaranteeing a rich user experience with minimal latency and no buffering."
Berlucchi added, "Combined with the capabilities of Silverlight, Skinkers LiveStation will be able to deliver a truly cross-platform solution and provide users with an unprecedented level of interactivity, delivered through a rich user experience. In addition, broadcasters can go to market with live streaming capabilities rapidly and cost effectively. Microsoft Silverlight and Skinkers LiveStation deliver live streaming over the Internet for everyone."
"The work between Microsoft and Skinkers to offer unparalleled rich interactive web experiences adds great value to the growing online video and Internet broadcasting markets," said Sean Alexander, Director of Video Platform for the Server and Tools Division at Microsoft. "By integrating Silverlight with LiveStation, we are enabling high-quality, cost-effective delivery of live video content for a wide range of audiences."
Networking Products Growing Fast
Excerpted from eChannelLine Report by Patricia Pickett
A recent study by research firm Access Markets International (AMI) Partners has found that wired and wireless switching, routing, and networking products top the list of fastest growing IT areas among US small businesses (SBs). Channel partners, in turn, will have the opportunity to reap the benefits of that growth by introducing new technologies to those firms.
New York-based AMI polled 1,005 SBs – defined as companies with one to 99 employees – for the "2006-2007 US Small Business Market Overview and Comprehensive Market Opportunity Assessment" study, which delved into SB IT budgets, purchase behaviors, decision influencers, channel preferences, outsourcing, service, support, technology attitudes, and strategic planning priorities.
The study found that wireless switching, routing, and networking products are expected to account for about $1.9 billion, up 13% from 2006.
According to Melissa Chong, analyst with AMI, networking has been one of the top three fastest-growing categories year-over-year for the past two or three years, along with security and storage. That’s no surprise, she said. "Companies are buying PCs, notebooks, and printers and they need devices that connect to one another." The need for more collaboration and file sharing is also driving growth. "It’s usually explained by the adoption curve: the more devices you have, the more you want them to talk to each other" in order to increase efficiency, she said.
The study also looked at the adoption of LANs by SBs. While 53% of US SBs have now installed a LAN, only 66% of those LAN-enabled businesses have a client/server-based network, while 33% use P2P networks.
The reason? "It could be that some of these companies simply do not need more than a small P2P network," which enables simple file sharing by linking all PCs on a network together.
Among SBs that already have a client/server setup, resellers will find opportunities to introduce other technologies, such as virtual private networks (VPNs), network storage, security, intranets, and hosted/premise-based IP communications. It’s not good enough just to offer products: solutions that utilize and enhance the network’s full capabilities will be especially important to SBs, Chong said.
Microsoft & Cisco Clash over Networking
Excerpted from NewsFactor Report by Peter Burrows & Jay Greene
In recent years, Cisco Systems CEO John Chambers and Microsoft CEO Steve Ballmer have met each quarter to discuss ways for the tech titans to work together – and work through areas where they compete. But this "co-opetition" relationship is increasingly tilting more toward competition.
At stake is which company will be best positioned to cash in on a critical technological shift toward networked computing. The clash was, in retrospect, inevitable: Cisco Systems built its router empire by correctly envisioning a world in which all manner of digital traffic, from songs to sophisticated corporate business applications, would be doled out over the Internet rather than being trapped in stand-alone devices such as the PC.
Now that Cisco has sold most of the routers that make up the foundation of this network, the action is moving to the services that run on it. That’s why Microsoft is racing to make its PC programs more network-centric – and why, with far more experience and brand awareness for selling consumer and business software, it represents a threat to Cisco’s hegemony.
The two have a similar view of the future. They agree that networked software will help users pull down information with the device of their choosing and let them share it in ever more useful ways. The moment an inventory-management program spots a parts shortage, the network could send alerts to whichever device is specified, be it PC, cell-phone, or whatever. Then it could arrange a web conference with the supplier.
How that happens is where Cisco and Microsoft diverge. Cisco thinks the key is to build most of these smarts into the network itself. That way, all programs and devices can work together, securely and glitch-free, based on one set of rules. This could make Cisco the reigning "platform" player, positioned as IBM was in the mainframe era or Microsoft when PCs were king.
Microsoft executives believe the priority is still the programs people use to actually get things done. So they are introducing innovations to let key applications, such as the Office productivity suite, make better use of the Net. And they’re counting on their experience in building software that’s easy to use.
"Cisco’s strength tends to be on the hardware side of things," said Jeffrey S. Raikes, President of Microsoft’s Business Division. The clearest lines of battle involve how to get digital devices to work in sync – particularly the office phone. Cisco sees a $10 billion opportunity in software that, for starters, would cause a speaker-phone to turn on the moment a user launched a web conference, without having to dial a separate call-in number.
Cisco has grabbed 24% market share in office phone systems, with Internet technology that enables free calling over computer networks. That means 12 million Cisco phones are able to use its Unified Communications software. "Microsoft has given us a three-year lead," said Chambers at a conference in April. "And we’ve never lost a game when we’ve had a three-year lead."
Chambers sounded even feistier after reporting the latest quarter, in which profits rose 34%. In an obvious dig at Microsoft, he said, "When we do move into new markets, we don’t take five years to make a profit. That’s a difference from our peers."
Still, Cisco must prove that it can sell products to actual business users, not just the network administrators who support them. It has taken some surprising steps in that direction. Last year, it unveiled "tele presence" systems, $300,000 videoconferencing rooms outfitted with banks of video screens and high-end audio devices. And on March 15th, Cisco shocked competitors by buying web-conferencing leader WebEx Communications for $3.2 billion.
That puts it in direct competition with Microsoft, which is No. 2 with its Live Meeting service. Microsoft’s big push will come in June when it begins producing a host of products, including Microsoft Office Communicator 2007.
Despite the jockeying, this battle isn’t likely to get as nasty as, say, Apple vs. Microsoft. Cisco and Microsoft still need to cooperate in plenty of areas – in part because their customers demand it. Also, Cisco wants to be in the running for huge contracts to outfit new data centers being built by Microsoft.
Says Cisco Chief Development Officer Charles H. Giancarlo: "Ninety percent of our businesses are very synergistic. We’ve been very clear with them about areas where they’ll compete, and they’ve been very clear with us."
P2P Maverick Takes on Tune Biz
Excerpted from IEEE Spectrum Report
Mark Gorton is drawing a line in the sand. The trained engineer and financial services entrepreneur is calling out the music business to a fistfight over the issue of P2P music distribution via the Internet. In this month’s online story The Music Industry Wants to Kill LimeWire from our entertainment industry columnist David Kushner, we meet the man who wants personal sharing of music to be a right for consumers – not a criminal offense.
Kushner explains that Gorton originally studied at Stanford and Yale to become an electrical engineer but figured he couldn’t go wrong by returning to school at Harvard to earn an MBA. Armed with his business degree, though, he soon heard the siren song of Wall Street calling and ended up working for Credit Suisse First Boston. In 1998, he ventured out on his own and founded Tower Research Capital, which conducts trades based on statistical analysis. As a sideline, he dabbled in the software that was making a big buzz in New York in the late ‘90s, P2P distributed file sharing, figuring that it could help facilitate financial transaction decision-making.
By 2000, Gorton had a new tool in hand called LimeWire, a free software client that could be used over the open-source Gnutella file-sharing network. However, he soon noticed that subscribers weren’t using the free service to trade advice on trades. They were trading tunes. While he was still making money offering a robust fee-based version of his P2P client, he didn’t see anything wrong with allowing the free service to continue unfettered. Then, as Kushner notes, the lawyers showed up at his door.
Following the landmark Supreme Court decision in 2005 known as MGM v. Grokster, attorneys for the big recording companies descended on the online P2P services to either get their consent in creating royalty schemes for songs shared among users or shut down their operations altogether. The result has been a social phenomenon – pitting millions of consumers against a handful of music monoliths – that continues to unfold to this day.
All the while, Gorton has continued to keep his powder dry and fight for his users. He believes that the lawyers for the big media companies don’t understand the realities of the Internet age. After meeting with a group of them in his Manhattan offices, Kushner writes, he came away thinking, "These people are all on drugs." Even after offering to set up his own file-sharing royalty system, the lawyers sued him anyway.
So last September, Gorton got his own attorneys to sue them back. His complaint alleges that the goal of the music business is "to destroy any online music distribution service they did not own or control, or force such services to do business with them on exclusive and/or other anti-competitive terms so as to limit and ultimately control the distribution and pricing of digital music, all to the detriment of consumers."
Today, Kushner states Gorton is considered to be the most prominent holdout in the record labels’ ongoing battle against online piracy. For his part, though, we learn, Gorton still wants to compromise, to find a solution that balances the old business model of the music companies and a new model of engaging his "customers" in an open and "productive way."
"The core focus of the music industry has been shutting down individual file-sharing programs, and that has proven to be a failure," Gorton told Kushner.
His legal battle is still in the discovery phase, so it will be quite a while before the fists start flying, with plenty of time in between for cooler heads to prevail. But Gorton seems committed to finding an alternative that could lead to a new era for consumers purchasing and sharing their favorite songs.
It’s a test case that will have a lot of people in the new media and old media worlds tuning in.
The Death of Piracy
Excerpted from Netribution Report by Wysiwyg Films
Piracy - no, not the eye-patch type, but the copyright infringement variety. Product piracy has been with us since the industrial revolution, but today it is most common in the distribution of music, films, and television shows. Compared to the film and TV industries, those music bods have been there, done that, bought the t-shirt (or unlicensed download) and, nowadays, seen the video.
But is piracy really the conquering invader we are warned about by industry propaganda or will it one day concede a dramatic surrender? How about, rather than a fight to the death, we work together for a cease-fire and a harmonious future? Piracy only thrives because there is a gap in the market, with consumers feeling their needs are not being met. They want it now, they want it cheap, they want it easy, and they want as much as they can get - and finally some people are listening.
Pirates would have no plan of attack if we could all get the same content free. Tedious release schedules give the pirates opportunity to sell us unauthorized copies ‘before the official release date’. But street pirates could shift the same number of units selling legitimate copies instead of contraband if the distributors worked with them instead of against them.
The late 1990s witnessed a boom in unauthorized music file sharing through P2P networks, such as Napster and Kazaa. P2P file exchange arose from the ashes of the dotcom era alongside open-sourced programming and other decentralizing practices, which questioned the status quo. Services like Napster, Grokster, Hotline, and Kazaa allow people to share large files with each other quickly and easily. On a P2P network, if a computer requests a file, instead of slowly copying it from a single server to a computer, it copies pieces of it from a thousand computers, which speeds up the process exponentially.
When music moved to digital files small enough to transfer across the internet a problem arose: people started swapping music files, piracy rose, and the music industry howled. The war on new technology had begun.
Taking the fight to the courts, the media bayed for blood. Inevitably Napster, the first great music-based P2P service fell. Others followed, but new ones constantly took up the call to arms.
But tough US Court rulings are not enough to keep a good idea down and the music industry finally learnt that old adage - if you can’t beat them, join them. It was pointless to make new technologies illegal, far better to use them to the industry’s advantage. Today online music distribution has been embraced, with the once rebellious Napster is now a legitimate online music store - only one of the estimated 300 services available, compared to a handful a few years back. And with this legitimacy, P2P has now been awarded the shiny badge of respectability.
Surely with the relevant case of music so recent a memory, film executives would have the opportunity to win the war without having to unsheathe their weapons? Apparently not. US TV writer/ producer John Rogers is incredulous. "What’s really amazing is that TV had the perfect test case, seeing the music business practically destroying itself and totally alienating their core fans for the past six or so years — and they look at that and say, ‘Yeah, that’s the way to go.’"
Online movie piracy was once considered by the Hollywood studios as seemingly impossible, and so it was: movie files were so large as to be unwieldy and with most Internet users in the early/mid 1990s using dial-up, it could take over 2 days to download a complete feature film. And no one needed a film that badly. Yet learning from Tom Cruise’s Maverick in ‘Top Gun’, the "need for speed" was soon upon us and broadband arrived with such promises a plenty. As "large-sized file transfer" problems became less severe with compression technologies such as DivX, sharing became more widespread and began to affect large software files like animations and movies. And with that, movies could be trafficked through the Internet providing consumers with exciting, new territories to explore. The vast majority of which were unlicensed and so DivX joined the lawyer’s hit list.
In the past, files were distributed by point-to-point technology with a central uploader distributing files to downloaders. With these systems, a large number of downloaders for a popular file used an increasingly larger amount of bandwidth. If there were too many downloads, the server became unavailable. The opposite is true for P2P networking, the more downloaders the faster the file distribution. With ‘swarming technology’, as implemented in file sharing systems like eDonkey or BitTorrent, downloaders help the uploader by picking up some of its uploading responsibilities.
P2P technology was employed by the brains behind Kazaa, Janus Friis and Niklas Zennström, to create Skype. This in turn revolutionized the communications industry and helped move P2P networks to legitimacy. Reveling in this newfound acceptance, we can now look forward to the introduction of Joost, the first grand worldwide P2PTV conduit. Joost’s vast library of quality content will help establish its name, but it will be the absence of any fees that make it stand alone amongst its competitors. With an advertising-backed model, customers plugging in anywhere in the world can enjoy content without paying a penny.
Sounds like the pirates lost that one.
But the advancements in technology don’t end there. DivX, like Napster was initially feared, but progressed to secure industry acceptance. DivX sealed deals with electronics companies to include their codec in home DVD players, enabling people to download a film, burn it to DVD and watch it at home on their TV. This effectively picked the pocket of the pirates, as the costs involved are so scant as to under-cut any illegal street seller.
Strike two!
Making matters worse for the pirates is the added value that many download services supply. The technology-literate can enjoy more than the just the film itself with many sites providing a plethora of added extras to excite film lovers. With anything from downloadable scripts or posters to special features, fans can immerse themselves more fully in the world of films keeping even the fussiest of fan boys happy. The online communities promise interactivity with other enthusiasts, and recommendations specifically monitored to reflect your personal tastes. All this and at the best quality.
So with the films available online legally and complete with all the trimmings, what is plan B for today’s pirate?
For many, it’s the immediate gratification they provide. If you are in England why wait for the film that’s screening to American audiences? Why delay getting your hands on a DVD if you don’t have to?
The high cost of producing numerous film prints for exhibition in cinemas meant that it used to take a film at least a year to open in cinemas around the globe. Money men need to feel that one window of opportunity is closed before they open the next one, in this case the end of a long cinematic run delays the arrival of the film on DVD. Because of this, DVDs did not come out for at least 12 months (and with zone restrictions), and then comes the television broadcasting window, then the cable window and so on.
But some of Hollywood’s most influential figures are looking to create a more simultaneous experience. George Lucas opened ‘Star Wars III: Revenge of the Sith’ on the same day internationally, an idea supported by John Fithian, from the National Association of Theatre Owners "we have consistently advocated reduced or eliminated windows between the US and international theatrical release."
The advent of digital cinema projectors will allow more films to open all over the world at the same time, as it cunningly sidesteps the time lags and costs incurred by its cousin the 35mm. Curt Marvis, from download giant CinemaNow, is looking forward to this change, "it is about time. I think we will see the Hollywood studios adapt their traditional release ‘windows’ more and more." Some distributors are already making their DVDs available only 1 to 2 months after a cinematic release and it seems to be an idea that is catching on. In Norway they are testing selling DVDs in cinema lobbies and Oscar winner Steven Soderbergh has put his considerable weight behind the matter. The director happily experimented with no window at all, allowing his murder mystery ‘Bubble’ to be watched at a cinema, on a DVD or on cable TV, all on the same day.
Some argue that such examples are merely the indulgences of big names that can afford the luxury of a low budget flop, and Soderbergh shouldn’t bite the hand that feeds him. His resolution has not been swayed by such criticisms: "The studio model has to be rethought," he told Hollywood Reporter. "Everything changes and evolves. We’ve got to get with it, embrace it and find a way to make it work... The movies are not the way they used to be when I grew up." The movie business, in his own words is "out of whack."
Simultaneous release may have the traditional money men shaking their heads, but as the windows close it will remove one more of the motivations that people have to go to pirates: seeing the films before they come out.
But lastly what about the pirates themselves - where do they stand in this war?
How about side-by-side with the film distributors? It’s really not too far-fetched. Supplying pirates with legitimate DVDs at cheap prices legitimizes the pirate networks, turning pirates into conventional points of purchase (POP). This benefits all parties and provides a new, yet established, outlet. Time Warner and Twentieth Century Fox have both met with success having implemented this scheme in China, though the inability to find legitimate Western DVDs and the low wages in China have also been influential factors. However with a tried and tested example out there, it cannot be too long until other distributors like Wysiwyg, look to the pirate as friend, not foe. Indeed Wysiwyg invites pirates to send an email to legitimatepirate@wysiwygfilms.com with a view to making more money by selling more, better quality DVDs.
As Hollywood attempts to pass some further legislation or publicly whine about the money it is losing from piracy, it fails to see the bigger picture. In the war between technology and piracy, technology can win and, like the reformation of street pirates, can now help establish a new world order. The technologies that once formed the greatest threat to the media industries have now removed that very threat. Oh, sweet irony.
Coming Events of Interest
P2P MEDIA SUMMIT LA – June 11th in Santa Monica, CA. This is the DCIA’s must-attend event for everyone interested in monetizing content using P2P and related technologies. Keynotes, panels, and workshops on the latest breakthroughs. Held in conjunction with the new Digital Hollywood Spring conference and exposition.
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Digital Hollywood Spring – June 12th–14th in Santa Monica, CA. Now expanded to Le Merigot as well as Loews Anatole Hotel. With many new sessions and feature events, this has become the premiere digital entertainment conference and expositions. DCIA Members will exhibit and speak on a number of panels.
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NXTcomm – June 18th–20th in Chicago, IL. The next-generation global forum and marketplace for the business of information, communications, and entertainment technology. The forces that drive communication and the solutions to harness it converge here. The DCIA will participate with Digital Hollywood.
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Edinburgh Television Festival – August 24th-26th in Edinburgh, Scotland. Janus Friis, Co-Founder of P2PTV service Joost, will deliver the inaugural Futureview Lecture at this year’s festival. The aim of this year’s event is to assemble a cast list from the hottest shows, the most exciting new technologies, and the biggest TV controversies of the year
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International Broadcasting Convention (IBC) – September 6th-11th in Amsterdam, Holland. IBC is committed to providing the world’s best event for everyone involved in the creation, management, and delivery of content for the entertainment industry, including DCIA Members. Run by the industry for the industry, convention organizers are drawn from participating companies.
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PT/EXPO COMM – October 23rd-27th at the China International Exhibition Center in Beijing, China. The largest telecommunications/IT industry event in the world’s fastest growing telecom sector. PT/EXPO COMM offers DCIA participants from all over the world a high profile promotional platform in a sales environment that is rich in capital investment.
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