July 6, 2009
Volume XXVII, Issue 1
Kazaa Movie Downloads Premiere on Palm Pre
The re-emerging P2P service Kazaa is planning to release a major new advancement that is intended to shake-up the online media industry, currently dominated by iTunes. Kazaa hopes to build on its previous popularity and success, and continue to build brand loyalty and differentiate itself from Amazon, iTunes, Napster, and Rhapsody.
The new service will enable Kazaa members to upload and share their standard and high-definition (HD) videos with the Kazaa community.
This exciting addition will allow for home videos and HD quality movies to be transferred for free. Members will be given the opportunity to share videos, HD movies, photos, and documents freely and without restriction.
The capacity to network within the community has been increased to meet the demands of users seeking a multifaceted approach to social networking. Kazaa now supports any phone that can connect to a PC.
The Palm PRE will be the first device to handle full-feature Kazaa HD quality movies.
Kazaa is now a subscription-based service offered by Brilliant Digital Entertainment (BDE), a leading online distributor of licensed digital content. BDE provides the means for record labels, film studios, and software developers to market and sell their products to a worldwide audience of 70 million users.
With the updated Kazaa P2P music service, users gain unlimited access to hundreds of thousands of CD-quality tracks for one low monthly fee, and can play those tracks on up-to-three devices that they own.
Gaming Engagement at All-Time High
Excerpted from Nielsen Wire Report
How have gamers responded to the recession? While much of the conversation has focused on fluctuations in new game sales, a study by the Nielsen Company shows there is much more to the story.
Over the past several months, the number of hours that gamers claim to be playing is at an all time high, part of a rising trend in game-play that began in 2007. Additionally, gamers have increased their purchase of used games to record-breaking totals since the Videogame Tracking survey began asking about this in 2006.
The same is true for subscriptions to videogame rental services by mail. Taken together, these trends point to gamers' continued engagement with the category even as their budgets have come under pressure. Overall, the recession has not abated the trend of increasing game-play and may have in fact accelerated it as gamers look to get more value out of the games they own.
"Primarily, we believe mainstream gamers are playing more of the broadly appealing games (i.e., "Wii Fit," "Guitar Hero," and "Rock Band") pushing their hours of game-play up," said Michael Flamberg, Director of Client Consulting, Nielsen Games.
"The social aspects of these games have engaged them. We don't believe hardcore gamers are driving up the usage averages we've observed. Second, gamers may be looking to stretch their entertainment dollar further through playing games they own more. The importance of value for them is evident in the findings on used game purchase."
For more, please download The Value Gamer: Play and Purchase Behavior in a Recession and read the coverage in the Los Angeles Times.
P2P-for-Games Working Group (PFGWG)
The DCIA's newest initiative, the P2P-for-Games Working Group (PFGWG), has published its Mission Statement and is now actively recruiting members.
The PFGWG's mission is to work with leading peer-to-peer (P2P) software developers, online games publishers, and other entities involved in games distribution over broadband networks to optimize commercial distribution of digital games and updates.
The mission will be carried out in two or more phases: 1) consumer protection, 2) intellectual property (IP) protection, with follow-on phases as determined by PFGWG participants.
Please call +1-410-476-7965 or e-mail PFGWG@dcia.info for more information or to sign-up.
P2P for games is an area of ongoing rapid expansion and enormous promise. The games industry is digitally sophisticated, aggressive, prolific, and highly innovative - in many ways the ideal content partner for the P2P industry.
The games industry has demonstrated the greatest potential to exploit the advantages of P2P and to address outstanding issues associated with this powerful technology.
Report from CEO Marty Lafferty
 The DCIA salutes the American Association of Advertising Agencies (4As), Association of National Advertisers (ANA), Council of Better Business Bureaus (BBB), Direct Marketing Association (DMA), and Interactive Advertising Bureau (IAB) on the publishing of their Self-Regulatory Principles for Online Behavioral Advertising.
The cross-industry self-regulatory program for online behavioral advertising was developed by these leading industry associations to apply consumer-friendly standards to online behavioral advertising across the Internet.
Its principles correspond with those proposed by the Federal Trade Commission (FTC) in February 2009, and also address public education and industry accountability issues raised by the Commission.
Online behavioral advertising increasingly supports the convenient access to content, services, and applications over the Internet that consumers have come to expect at no cost to them. Here is a summary of the salient points of this landmark document, which we are pleased to endorse.
The Education Principle calls for organizations to participate in efforts to educate individuals and businesses about online behavioral advertising. To this end, the digital media industry intends, in a major campaign that is expected to exceed 500 million online advertising impressions, to educate consumers about online behavioral advertising, the benefits of these practices and the means to exercise choice, over the next 18 months.
The Transparency Principle calls for clearer and easily accessible disclosures to consumers about data collection and use practices associated with online behavioral advertising. It will result in new, enhanced notice on the page where data is collected through links embedded in or around advertisements, or on the web page itself.
The Consumer Control Principle provides consumers with an expanded ability to choose whether data is collected and used for online behavioral advertising purposes. This choice will be available through a link from the notice provided on the web page where data is collected. It also requires "service providers," a term that includes Internet access service providers (ISPs) and providers of desktop applications software such as web browser "tool bars" to obtain the consent of users before engaging in online behavioral advertising, and take steps to de-identify the data used for such purposes.
The Data Security Principle calls for organizations to provide reasonable security for, and limited retention of data, collected and used for online behavioral advertising purposes.
The Material Changes Principle calls on organizations to obtain consent for any material change to their online behavioral advertising data collection and use policies and practices to data collected prior to such change.
The Sensitive Data Principle recognizes that data collected from children and used for online behavioral advertising merits heightened protection, and requires parental consent for behavioral advertising to consumers known to be under 13 on child-directed websites. This Principle also provides heightened protections to certain health and financial data when attributable to a specific individual.
The Accountability Principle calls for development of programs to further advance these Principles, including programs to monitor and report instances of uncorrected non-compliance with these Principles to appropriate government agencies.
Like previously established Network Advertising Initiative (NAI) standards, the newly published Principles embrace a classic notice-and-consent regime, where consumers are empowered to opt-out of online tracking that they don't accept and must affirmatively provide permission in advance before having sensitive data collected digitally.
These Principles can provide a very useful benchmark for online activity and effectively translate and codify what had been carefully defined over time as acceptable practices offline.
This in turn can form a rational and highly effective basis for examining additional measures and evaluating proposals that are more specifically designed for the Internet, such as the Privacy Icon recommended by Annenberg School of Communications' Joseph Turow, the Targeted Advertising Cookie Opt-Out (TACO) plug-in for Firefox, and other technological solutions.
This area is of particular importance to the distributed computing industry, with P2P, cloud computing, and file-sharing applications as DCIA Member companies' core competencies.
Once application data is in one or more distributed environment(s), by definition it will reside across multiple networked devices in many locations. And although the software itself is often capable of performing seamlessly on a global basis, standards that govern personal and sensitive data handling are far from being uniform around the world today.
With distributed computing technologies, it's possible to monitor, log, or even block virtually any action taken by users.
We have, quite possibly for the first time on any platform, the potential for complete "auditability," and with that, unique responsibilities and opportunities, including the provision of frameworks for services that the online advertising industry will choose to adopt as standard practices. Share wisely, and take care.
Online Ad Spending Rises at Double-Digit Rates
Excerpted from Online Media Daily Report by Joe Mandalese
"Its familiar virtues of transparency, accountability, and flexibility have proven even more attractive in a recession than ever," Publicis ZenithOptimedia writes in its new report.
Based on current trends, the agency projects Internet ad spending will rise to $56.8 billion this year, or 12.6% of the global advertising economy. That means the Internet will pick up more than two points of worldwide advertising share, this year, and its momentum is only expected to accelerate.
"By 2011 we expect it to account for 15.1% of all ad expenditures, up from 10.5% in 2008," the report predicts. "Most of this growth will come from paid search, which is an ideal method of reaching consumers looking for bargains. In the US, we predict search advertising to grow 20.0% in 2009, while traditional display grows 3.0% and classified grows just 1.8%."
The gains in the Internet's share of global ad spending appear to be coming at the expense of every other major medium. ZenithOptimedia predicts spending in all other media will decline this year.
Overall ad spending is now expected to decline 8.5% this year, down from ZenithOptimedia's April forecast of a 6.9% drop.
ZenithOptimedia said the first quarter "came in below our expectations," and that, "in uncertain times, advertising is often treated as a discretionary expense and cut early, despite much research that shows companies maintaining their ad expenditure in a recession come out of it stronger than those that do not."
Among the other major media, ZenithOptimedia forecasts TV, cinema, and outdoor will decline by less than the market as a whole, shrinking by 7.1%, 4.8%, and 7.0% respectively.
"Some advertisers, particularly in the fast-moving consumer goods sector, are taking advantage of cheap television and increasing their volumes, targeting higher market share. Cinema often does relatively well in a recession, providing consumers with escapist entertainment. Digital billboards and other non-traditional forms of outdoor are attracting budgets from other media by offering new types of eye-catching display."
Global Gaming Factory Charts New Course for TPB
Excerpted from Vancouver Sun Report by Matt Hartley
The Pirate Bay (TPB) may be planning to weigh anchor from its long-time port in the seas of copyright infringement and set sail for legitimate waters.
Last Week, Stockholm-based Global Gaming Factory (GGF) announced it intends to purchase TPB for $7.8 million in a cash and stock takeover.
GGF, which provides software to and operates a chain of Internet cafes and online gaming venues, also unveiled its intention to chart a new course for TPB, one that would turn the international entertainment industry's number-one enemy into a legitimate online media service that will respect copyright laws and pay artists for their creations.
"We would like to introduce models which ensure that content providers and copyright owners get paid for content that is downloaded via the site," GGF's Chief Executive Officer (CEO) Hans Pandeya said.
"TPB is a site that is among the top 100 most visited Internet sites in the world," he said. "However, TPB requires a new business model which satisfies the requirements and needs of all parties: content providers, broadband operators, end-users, and the judiciary. Content creators and providers need to control their content and get paid for it."
One of the most visited sites on the Internet, TPB acts as a Google-like search engine for downloadable media files such as music and movies, most of which infringe on international copyrights. TPB receives about 20 million visitors per day and about one billion page views per month, according to GGF.
The Pirate Bay's New P2P Technology
Along with its acquisition of The Pirate Bay (TPB), DCIA Member Global Gaming Factory (GGF) also plans to buy P2P technology company and active P4P Working Group (P4PWG) participant Peerialism for $13 million and introduce its technology to the new TPB, which will feature authorized content distribution.
Andreas Dahlstrom, Chief Technology Officer (CTO) and Co-Founder of Peerialism, explains more about the new technology.
BitTorrent accounts for more than 25% of all Internet traffic and has proven that P2P can solve major distribution problems.
Peerialism plans to introduce an improved BitTorrent Tracker for the new TPB. The main focus on the first release is network locality awareness, reducing traffic in Internet service providers' (ISPs) networks and increasing download speeds.
"We see 20-to-50% less inter- and intra-ISP-traffic and 30-to-150% faster download speeds. We map the entire Internet and use it to connect peers closest to each other instead of random peer assignment," says Peerialism CTO Dahlstrom. New ways for content owners to get paid and regain some control will also be introduced.
Peerialism technology is somewhat similar to P4P but doesn't need the co-operation of ISPs and iTrackers, Dahlstrom continues. "The key is that we have access to the BitTorrent Trackers, so we don't need to introduce our software into every ISP's network. But the ISPs will notice a significant decrease in traffic when we start-up the new Trackers."
Peerialism has 14 employees and was founded in 2006 with close ties to the Swedish Institute of Computer Science (SICS). Peerialism focuses on P2P software to distribute and store large data volumes.
Peerialism has recently launched a P2P streaming system which reduces bandwidth cost by 90-to-95% for both ISPs and broadcasters.
Gaming Business Models: Freemium Beats Advertising
Excerpted from WordPress Report by Jeremy Liew
Dan Cook has a great post about business models for Flash game developers over at Lost Garden. He says:
"Ads are a really crappy revenue source. For a recent game my friend Andre released, 2 million unique users generated around $650 from MochiAds. This yielded an average revenue per user (ARPU) of only $0.000325. Even when you back in the money that sponsors will pay upfront, I still only get an ARPU of $0.0028 per user. In comparison, a MMO like 'Puzzle Pirates' makes about $0.21 per user that reaches the landing page (and $4.20 per user that registers).
What this tells me is that other business models involving selling games on the Internet are several orders of magnitude more effective at making money from an equivalent number of customers. When your means of making money is 1/100th as efficient as money-making techniques used by other developers, maybe you've found one big reason why developers starve when they make Flash games.
The solution? Ask for the money. When game developers ask for money, they are usually pleasantly surprised. Their customers give them money; in some cases, substantial amounts. I witnessed this early in my career making shareware games at Epic in the 90s and I'm seeing the same basic principles are in play with high-end Flash games.
'Fantastic Contraption,' for example, pulled in low 6 figures after only a few months on the market. That's about 100x better than a typical Flash game and in-line with many shareware or downloadable titles."
I think his conclusion is right not just for Flash game developers, but for all sorts of game developers, including MMOGs, iPhone games, etc.
Dan runs through some steps that game developers should take to maximize their chances of being able to make a living from designing games, specific ideas about what to charge for, and responses to common objections to getting users to pay. For new or aspiring game designers, it is worth reading the whole thing.
Few Answers from Media Moguls about Digital Future
Excerpted from MediaPost Report
Media moguls painted a murky picture of the digital future, The Wall Street Journal reported, during a panel discussion at the Allen & Co. media and technology conference in Sun Valley, ID, with IAC Chairman Barry Diller, Walt Disney CEO Bob Iger, and Liberty Media Chairman John Malone each expressing uncertainty.
Following the discussion, New Yorker writer Ken Auletta, who moderated the session, noted that, "no one had any answers" about making money on the Internet.
Twitter came up during the course of conversation, with Diller expressing pessimism over the micro-blogging service's business prospects. Malone didn't seem to think an advertising model made sense on Twitter, but said there was some hope for a subscription model.
"Sooner or later people will be willing to pay for these services," he said, adding that Warren Buffett privately told him he would pay $5 a month for YouTube.
Meanwhile, people who attended the conference, which was closed to the press, said that Twitter CEO Evan Williams was in the audience but didn't speak-up to defend his company. After the event, they said he walked out alone and declined to talk to the press.
Bram Cohen on BitTorrent Bandwidth Fundamentals
Excerpted from Zeropaid Report
I've always found Bram Cohen, author of the BitTorrent protocol, very fascinating, perhaps because he's enabled countless people to share content in so many ways - including some yet to be imagined.
So whenever he shares his thoughts on BitTorrent, I always sit up and take notice.
In this case, he gives a simple explanation of why BitTorrent performs so well, dispelling the myth that content popularity drives download speeds. He writes:
"There's a classic fallacy because if one person stands up during a concert they get a better view, then if everybody stood up during a concert they'd all get a better view. This is of course is not true - they wind up slightly worse off by all standing, because they all compete with each other for a view. The same thing happens with downloading from a server.
In general, web servers will give about the same rate to every client downloading from them, so if you open many more connections than everybody else you get a greater proportion of the bandwidth and hence a better rate. But you do so simply by taking bandwidth from other downloaders. The overall supply of upload is unchanged, it's simply being shuffled around. If everybody does the same thing it results in overall slightly worse performance and you're basically back where you started, but with a bunch of headaches tacked on.
So why does BitTorrent perform so well? Quite simply, because it does a better job of finding more places to do uploading. Any peer which is downloading is in general willing to upload as well, and his or her uplink is usually unutilized, so if you can get a peer to start uploading as soon as it starts downloading, and keep uploading as long as possible, and saturate its link while it's uploading, then overall performance will be better.
It doesn't necessarily help to transfer over more connections, or make more different things available at the same time, or use error-correcting codes. In fact, all of those are a complex tradeoff between benefits and costs, with the net result being that small amounts of them can help reliability and robustness, but in general it's good to keep things simple and be polite to the network.
On the Internet, the formula is bytes downloaded = bytes uploaded. It's that simple."
Indeed, it is.
Free-N-Legal MP3 Bonanza from LimeWire
Excerpted from BLRag Report by Wes Morgan
Many of you know LimeWire as a P2P file-sharing application. Well, LimeWire has stepped into the world of online music sales with the LimeWire Store, which is currently running in public beta.
After delivering a sampler from New York City's CMJ Music Marathon, LimeWire partnered with local alternative media to create its new Ear to the Ground series of free samples. Each is a selection of local bands, and the lineup is pretty impressive: Boston, Philly, LA, Brooklyn, Seattle, Chicago, SF, and SxSW (Austin, TX festival), with Berlin, Paris, and Beijing providing international flavor.
All in all, we're talking about 175 tracks of high-quality listening across a wide range of styles.
You'll need to register with the LimeWire Store, but you don't have to give them credit card info unless/until you purchase something. If you have LimeWire installed on your PC, your selections will download automatically; if not, you have to go track-by-track. Check it out.
Spotify Lures Investors with £200 Million Siren Song
Excerpted from London Times Report by James Ashton
P2P music streaming service Spotify is trying to drum up a valuation of close to £200 million as it seeks a new investment of between £20 and £30 million.
The service, which has signed up more than 2 million users in Britain since launching last October, took almost two years to persuade the four main record labels to let people listen free to their tracks.
Spotify makes money from advertising breaks and £9.99 monthly subscriptions.
If it achieves its valuation, Spotify will have almost trebled in value since it sold a £13 million stake last autumn to Nordic investors Northzone Ventures and Creandum. Co-founders Daniel Ek, who helped set up children's fashion website Stardoll, and Martin Lorentzon do not plan to give up control.
Ek said the business was doubling revenues monthly. "We are probably in better shape than most other companies in this market," he added.
MJ Search Demand Explodes Across P2P Networks
Brand Asset Digital (BAD), with a focus on P2P search marketing, P2P live streaming, and P2P business Intelligence, released data this week revealing that search demand across major P2P protocols for Michael Jackson related keyword searches exceeded 250 million queries worldwide generating an estimated 4+ billion impressions since the iconic singer's passing on June 25th.
P2Panalytics data indicated that, over a two-week period, file-sharing demand regarding the late artist surpassed by more than 100 times Nielsen Soundscan's reported 2-to-3+ million downloads of tracks and albums on iTunes and other digital download stores.
"We've been tracking the related volume of search queries and impressions - as well as behavioral intelligence across all the major P2P protocols - with P2Panalytics, and the explosion of demand and engagement across P2P for Michael Jackson is unprecedented," said BAD Co-Founder Joey P.
"Since June 25th, this activity has grown to be far greater than for any major music or film release ever seen across P2P. It is demand like this that continues to demonstrate why the P2P space is the next frontier of eyeballs for search marketing advertisers. Technologies like our P2Pwords (SEO and SEM) capture and leverage searches, impressions, and clicks the way Google did with Adwords for web search."
Missy Hogan, BAD's Head of Operations added, "To see daily traffic go from a few hundred thousand queries to well over 20 million reflects more demand than any music, film, videogame, software, file, or search term we have ever encountered. We believe, based on this trend, that, by the end of July, Michael Jackson demand may break 1 billion search queries, making the estimated impression number across all P2P search close to 20 billion."
"This data points to the ubiquitous future of distributed computing," said former Chairman & CEO of Island DefJam and BAD Advisor Jim Caparro. "The numbers seem large at first, but, in reality, with an artist as global as Michael Jackson was, if every person with a P2P application did simply one search during the measurement period, that alone would total 500 million."
BAD's P2Panalytics business intelligence data tracks behavior across the major P2P protocols worldwide as part of the P2Pwords search marketing platform, which, while still in beta, is already considered the Google Adwords equivalent for P2P. The platform was recognized as the Product of the Year at the DCIA P2P Media Summit at CES in January.
Memorial Service Reaches Global Audience with Octoshape P2P Streaming
The emotional and widely viewed Michael Jackson memorial service was successfully streamed live via Octoshape's Infinite Edge P2P technology to millions of viewers in over 200 countries.
Through global news coverage and social networking sites, the memorial service ranked among the most-streamed live events in the history of the Internet, perhaps second only to the 2009 US Presidential Inauguration.
As such large-scale events occur, Octoshape has consistently ensured that users around the world can access a high-quality, stable P2P stream over the Internet.
With the Octoshape solution, over 1 million unique users watched 2.7 million live P2P streams of the memorial service; and cumulative successful stream-time exceeded 94 million minutes throughout the day.
Exceptional user experiences were delivered through the Octoshape P2P platform over the Highwinds content delivery network (CDN), as evidenced by reliable, high-quality streams that averaged 90 minutes in viewing time per user. This data was collected through precision reporting tools and real-time analytics from Octoshape and Highwinds.
"The successful streaming of this week's event was further proof that Highwinds and Octoshape together deliver streams of the largest events on the planet to massive audiences, through streams that are simultaneously high in quality and quantity," said Scott Brown, CEO of Octoshape in the United States.
"It is because of this successful track record with these types of events that customers who require scale and quality at a sustainable cost rely on Highwinds with the Octoshape Infinite Edge. We are very proud of the numbers we achieved and pleased to support massive global viewership on a daily basis."
Nearly 40% of the viewers watching the high-quality, no buffering P2P streams were from outside the United States - a clear testament to the resiliency, scale, and global reach of Octoshape's Infinite Edge technology.
Private P2P Networks Add Trust to File Sharing
Excerpted from PC World Report by Jackson West
Stephane Herry says that he founded his private file-sharing network GigaTribe out of frustration at not being able to share files with his friends on Kazaa. Every time he searched for a file that he knew a friend had uploaded, he saw only similar files uploaded by strangers.
Why not, Herry thought, create a P2P application that permitted only trusted sources to share files? Such a network would be far more secure, because you'd be sharing files exclusively with people you know and trust - not with complete strangers, some of whom may wittingly or unwittingly be spreading viruses.
Herry's idea is proving to be popular. Some of the biggest names in public P2P file sharing now offer private alternatives.
In its latest release, industry-leading file-sharing client LimeWire now allows users to share files privately with contacts that it pulls from Google or LiveJournal contact lists.
Vuze, a popular BitTorrent client, added a FriendBoost feature to speed torrent downloads by sharing them within a group of trusted users.
In the past few years, private file sharing has evolved, steadily improving in speed, security, and functionality. Depending on what you're looking for, you can probably find a software product or web app that's perfectly suited to help you and your friends or co-workers share anything from spreadsheets to home movies legally, safely, and privately.
We took a look at four applications that promise secure, efficient file sharing among private groups: QNext, GigaTribe, 2Peer, and LogMeIn Hamachi.
File sharing is just one of the features offered by QNext. It's primarily designed to serve as an integrated communications suite, with instant messaging (IM), voice, and video-chat components. But it also allows you to share files securely - with no size restrictions - and it has special photo and music capabilities as well. Finally, QNext even lets you gain remote access to your computer through a standard web browser.
QNext is a free download available for Windows, Mac, and Linux operating systems. Versions for the iPhone, the iTouch, and Google Android-powered smartphones are currently in the beta stage.
In GigaTribe, once you've set up some files to share, you can chat with other users directly through the program.
With a familiar and friendly interface, GigaTribe targets casual computer users who want to share media collections with friends. The download, installation, and account creation process is straightforward, with no router or firewall configuration necessary. You can invite friends to download, install, and register for GigaTribe through e-mail or via social networks such as Facebook, LinkedIn, and Flickr.
GigaTribe is available only for Windows PCs, and the latest version is still in beta. Once the Windows version is finalized, the developers have promised to add a version for Mac users.
What makes 2Peer unique is that its interface works entirely within your browser - though additional software runs in the background, so an installation is required. Once that's completed and you've created a user account, however, starting up 2Peer will launch your default browser, from which you'll be able to manage your shared files and folders or connect with other users.
Like QNext, 2Peer lets you share files with users who don't necessarily have the program installed - in the case of 2Peer, you can rely instead on e-mailed links or on 2PeerWeb, a fully browser-based version that supports downloads. Also, like QNext and GigaTribe, you'll have to have 2Peer up and running for others to access your data, and vice-versa.
The service is completely free, and it works on Windows PCs, Macs, and iPhones (meaning that if you have an iPhone, you can download files from friends on the fly).
LogMeIn Hamachi is not specifically designed for file sharing; however, it provides a quick, inexpensive, and relatively easy way to set up a virtual private network (VPN). This means that the connection between computers over the public Internet mimics that of a private network, such as a local area network (LAN).
All users that you want to connect will have to have Hamachi downloaded and installed on their machines. Officially the program works with Mac and Linux systems as well as with Windows PCs, but only the PC version has a familiar graphical user interface (GUI); Mac and Linux users must install and configure the software through a command-line interface. All versions will tunnel through your operating system or router firewall automatically, so little or no configuration is required.
The service is free for personal use and costs $5 per month per license for business use.
Please click here for the full report.
Judge Rules P2P Legal, Sites Innocent
Excerpted from Tom's Guide Report by Kevin Parrish
In a legal battle involving eD2K link site ElRincondeJesus, a Spanish judge has ruled that P2P file-sharing networks do not violate in principle any right protected by the nation's Intellectual Property (IP) Law. The ruling serves as another blow to the entertainment industry in Spain after the "3-strikes" rule was shot down, and the request to throttle unauthorized file sharers went ignored.
The Coalition of Creators and Content Industries, a group that includes Promusicae and SGAE, also went after the country's 200 torrent sites. However, that, too, proved pointless, as the Spanish court ruled in favor of the torrent sites each time, saying that linking is legal, provided that profits aren't made directly from infringement.
The SGAE next went after torrent and eD2K sites privately. ElRincondeJesus received its complaint on May 13th, claiming that its links "abused" the copyrights held by SGAE members. The site's owner was summoned to appear in court on June 5th.
According to a message posted on its website, the owner was innocent, as ElRincondeJesus does not advertise, but merely provides links to other sites "like thousands of search engines in the world."
According to the ruling, Barcelona judge Raul Garcia Orejudo agreed with that assertion, and in addition to his verdict that P2P networks do not violate IP Law, found that many barred activities do not concern P2P, and that there has to be a presumption of innocence.
"Adding a work or video recording to eMule, which has previously been converted to a compatible computer file, is not an act of reproduction," he said, in regards to possible infringement of the Intellectual Property Act.
"Copying is not a profitable use, or collective use, as these two terms refer to the subsequent use made of the work once downloaded, after the copy."
TorrentFreak added that the Intellectual Property Act describes distribution as needing something tangible - an FTP or a website offering copyrighted material to download would be two examples - and P2P networks do not fall within that area.
This was only a pre-trial hearing, however; the full trial against the owner of ElRincondeJesus is scheduled to take place at a later date.
$1.92 Million Verdict is Unconstitutional, Thomas-Rasset Says
Excerpted from ZDNet Report by Richard Koman
While an appeal is likely in the cards, the motion Jammie Thomas-Rasset's lawyers filed this week was a request for a new trial or for the judge to alter the jury's shocking $1.92 million award.
Thomas-Rasset's lawyers argued 1) that the jury's verdict of $80,000 per infringed work is unconstitutional because it violates due process; 2) that it is so unconscionable that the court may unilaterally knock the award down to a more reasonable number; and 3) that the court should set aside this verdict and empanel yet another jury for trial #3.
The lawyers also said they planned to appeal on the issue of admitted evidence and the lack of a certified copyright certificate.
Regardless of the theory, the main issue is the size of the award. Copyright Law provides for a broad range of statutory damages per infringed work. One question is whether a "work" is a song or an album. Either way, the ratio of statutory damages to value of the infringed work is mind-boggling.
For 24 songs, available for $1.29 each on iTunes, the jury assessed statutory damages of $80,000 per song - a ratio of 1:62,015. For 24 albums, available for no more than $15 at the store, the jury assessed statutory damages of $80,000 per album - a ratio of 1:5,333.
"Grossly excessive" punitive awards are disallowed by the due-process clause, the Supreme Court has ruled. While the Court refused to recognize absolute numbers, it strongly suggested that anything over three, four, or at most nine times the actual damages would fail the test. It would appear the Thomas-Rasset award easily qualifies.
The defendant also asked the court to simply knock down the award to something reasonable under the federal common law remedy of "remittitur."
Remittitur is appropriate where the result on a verdict is monstrous or shocking. Here, where the punishment ratios are 1:62,015 measured in songs or 1:5,333 measured in albums, the verdict is both monstrous and shocking.
Mrs. Thomas-Rasset was a single mother who, at worst, downloaded and shared some music on Kazaa, music for which she had already lawfully purchased the CDs, without any hint at all of a commercial motive. Her wrongdoing is a far cry from that which normally results in a $1.92 million verdict.
The defendant is also asking for a new trial on the basis that the court erred in admitting evidence because it was illegally obtained.
The judge previously expressed outrage over the size of the original $222,000 verdict in trial #1, so he may well welcome the opportunity to throw this one out, as well. Whether he would order a whole new trial is anybody's guess. And at this point, the RIAA probably would welcome seeing this one swept under the rug.
PFF: LimeWire is the Devil's Child
Excerpted from P2P Blog Report by Janko Roettgers
The "conservative" Progress and Freedom Foundation (PFF) has published "Inadvertent File Sharing Re-Invented: The Dangerous Design of LimeWire 5" that makes LimeWire sound like the most dangerous application ever.
According to the "study," LimeWire's features help "identity thieves, pedophiles, terrorists, and spies;" and can also "grant reduced jail sentences to dangerous pedophiles" and "knowingly inflict harm upon children and their families." Scary stuff - all thanks to what has been called inadvertent file sharing.
LimeWire had gotten some heat for inadvertent file sharing before, and the company responded to critics by redefining the way its new version 5.0 shares files. LimeWire 5 introduced the idea of a content library that by default isn't shared with anyone.
Users have to take an extra step to select files within the library and share them to make them available for download via the Gnutella network. At the core of PFF's criticism is a feature that makes it possible to share bulk selections of these files by clicking on "share all with P2P network."
One could debate whether the option "share all with P2P network" is really unclear. PFF thinks you could get confused and share everything when you'd want to "unshare" all your files.
However, LimeWire 5 also offers multiple ways of monitoring which files you're sharing. Every file comes with an icon that visualizes its status: it's green if you share it and gray if you don't. There's a menu entry in the side-bar called "P2P network." Click on it, and you'll see all the files you're sharing with the world in one list. It couldn't really get any easier than that.
PFF writes that users "perhaps" share documents by accident. That's because, by definition, they cannot. LimeWire makes it impossible to share any pdf, txt, doc, or xls files without changing a setting under "Tools > Options > Security > Unsafe Categories." It's hard to do that accidentally.
However, PFF has still found a way users can expose some personal data: if they are saved in tif or jpg image formats, even though most scanners by default save documents as pdf files now. And, in any case, users still have to explicitly share these files.
PFF stretches the definition of sensitive information even further: music collections not authorized for sharing and therefore "sensitive." Right - MP3s are pretty much the same as Social Security numbers.
PFF has a track record of copyright maximalism, and one has to wonder whether its repeated attacks against LimeWire aren't just attempts to rid the Net of copyright infringement. The foundation is funded by entertainment industry heavyweights like EMI, Sony Music, Viacom, and Vivendi.
Those companies apparently pay enough money to fund 27-page studies that boil down to one single point of criticism: LimeWire 5 has a "share all" feature.
Good news: the upcoming LimeWire version 5.2 includes further refinements of the new LimeWire user interface (UI). One of them is that the "share all" button is gone.
The World at a Crossroads
Excerpted from Financial Times Report by Christian Engstrom
(DCINFO Editor's Note: Christian Engstrom is a Swedish computer programmer, activist, and politician. He is Deputy Chairman of the Piratpartiet and was elected a Member of the European Parliament (MEP) in the 2009 election).
If you search for Elvis Presley in Wikipedia, you will find a lot of text and a few pictures that have been cleared for distribution. But you will find no music and no film clips, due to copyright restrictions. What we think of as our common cultural heritage is not "ours" at all.
On MySpace and YouTube, creative people post audio and video remixes for others to enjoy, until they are replaced by take-down notices handed out by big film and record companies. Technology opens up possibilities; copyright law shuts them down.
This was never the intent. Copyright was meant to encourage culture, not restrict it. This is reason enough for reform. But the current regime has even more damaging effects. In order to uphold copyright laws, governments are beginning to restrict our right to communicate with each other in private, without being monitored.
File sharing occurs whenever one individual sends a file to another. The only way to even try to limit this process is to monitor all communication between ordinary people. Despite the crackdown on Napster, Kazaa, and other P2P services over the past decade, the volume of file sharing has grown exponentially.
Even if the authorities closed down all other possibilities, people could still send copyrighted files as attachments to e-mails or through private networks. If people start doing that, should we give the government the right to monitor all mail and all encrypted networks?
Whenever there are ways of communicating in private, they will be used to share copyrighted material. If you want to stop people doing this, you must remove the right to communicate in private. There is no other option. Society has to make a choice.
The world is at a crossroads. The Internet and new information technologies are so powerful that, no matter what we do, society will change. But the direction has not been decided.
The technology could be used to create a big-brother society beyond our nightmares, where governments and corporations monitor every detail of our lives. In the former East Germany, the government needed tens of thousands of employees to keep track of the citizens using typewriters, pencils, and index cards. Today a computer can do the same thing a million times faster, at the push of a button. There are many politicians who want to push that button.
The same technology could instead be used to create a society that embraces spontaneity, collaboration, and diversity. Where the citizens are no longer passive consumers being fed information and culture through one-way media, but are instead active participants collaborating on a journey into the future.
The Internet it still in its infancy, but already we see fantastic things appearing as if by magic. Take Linux, the free computer operating system, or Wikipedia, the free encyclopedia. Witness the participatory culture of MySpace and YouTube, or the growth of The Pirate Bay (TPB), which makes the world's culture easily available to anybody with an Internet connection.
But where technology opens up new possibilities, our intellectual property (IP) laws do their best to restrict them. Linux is held back by patents, the rest of the examples by copyright.
The public increasingly recognizes the need for reform. That was why Piratpartiet - the Pirate party - won 7.1% of the popular vote in Sweden in the European Union (EU) elections. This gave us a seat in the European parliament for the first time.
Our manifesto is to reform copyright laws and gradually abolish the patent system. We oppose mass surveillance and censorship on the Net, as in the rest of society. We want to make the EU more democratic and transparent. This is our entire platform.
We intend to devote all our time and energy to protecting the fundamental civil liberties on the Net and elsewhere. Seven percent of Swedish voters agreed with us that it makes sense to put other political differences aside in order to ensure this.
Political decisions taken over the next five years are likely to set the course we take for the information society, and will affect the lives of millions for many years into the future.
Will we let our fears lead us towards a dystopian big-brother state, or will we have the courage and wisdom to choose an exciting future in a free and open society?
The information revolution is happening here and now. It is up to us to decide what future we want.
Coming Events of Interest
Social Media for Government - July 13th in Arlington, VA. Attend this conference to learn how to capture the power of social media in your organization. Hear practical advice, firsthand, on how to engage your employees and citizens by using social media from leading government agencies and organizations, including the US Department of State, National Institutes of Health, and many others.
Casual Connect Seattle - July 21st-23rd in Seattle, WA. The most anticipated conference for the casual games industry in the United States. Over 2000 industry professionals will flock to the Pacific Northwest.
Bandwidth Conference - August 27th-28th in San Francisco, CA. Annual gathering of music/media executives and digital music professionals. Bandwidth explores the evolving musical experience - how people discover, purchase, interact with, and are exposed to new music.
all2gethernow! - September 16th-18th in Berlin, Germany. An "open source" forward-looking Music 2.0 substitute for the postponed PopKomm, one of the leading international conferences and expos for the music and entertainment businesses worldwide.
New York Games Conference - September 30th in New York, NY. Join games industry leaders - including leading videogame publishers and developers, carriers, portals, technology companies, advertising execs, venture capitalists, lawyers, analysts, and many more.
P2P and Games Conference - October 19th in Santa Monica, CA. The DCIA's first-ever event focusing on the use of P2P technologies for the distribution of games and updates. Industry leaders from around the world will participate.
Digital Hollywood Fall - October 19th-22nd in Santa Monica, CA. With many new sessions and feature events, DHF has become the premiere digital entertainment conference and exposition. DCIA Member companies will exhibit and speak on a number of panels.
Cloud Computing Expo - November 2nd-4th in Santa Clara, CA. Fourth international conference on this subject. Cloud computing is a game changer. The cloud is disrupting traditional software and hardware business models by disrupting how IT service gets delivered.
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