October 26, 2009
Volume XXVIII, Issue 5
Cisco Delineates Visual Networking, P2P, Peak Usage Trends
Excerpted from TMCnet Report by Paula Bernier
Cisco Systems this week unveiled its latest study on service provider traffic trends. The study, done during the third quarter, is created by compiling and analyzing actual traffic information from more than 20 service providers' networks.
Doug Webster, Director, Market Management for Cisco's Service Provider Group, notes that 37% of overall traffic is video, or "visual networking" as Cisco likes to refer to it.
He adds that while many believe peer-to-peer (P2P) traffic takes up the bulk of Internet bandwidth, in fact it takes up just 38%. While that's significant and continues to increase, it increased less this year than it did in the past.
Here are some other highlights: globally, the average broadband connection (primarily residential subscribers and some business users) generates approximately 11.4 gigabytes of Internet traffic per month; the average broadband connection consumes about 4.3 gigabytes of visual networking applications (advanced services such as video, social networking, and collaboration) traffic per month; the top 1% of global subscribers generated more than 20% of all traffic; and the top 10% of global subscribers generated more than 60% of all traffic.
Internet "prime-time" spans from approximately 9 PM to 1 AM around the world. This contrasts with broadcast TV prime-time, which is generally from 7 PM to 11 PM across most global markets. 25% (or 93.3 megabytes per day per connection) of global Internet traffic is generated during the Internet prime-time period.
A peak Internet hour has 20% more traffic than a non-peak Internet hour. The peak Internet hour averages 18 megabytes of traffic per connection (per hour), while non-peak Internet hours average 15 megabytes of traffic per connection (per hour).
The peak Internet visual networking hour has almost 25% more traffic than average hourly Internet traffic.
Webster adds that while Cisco has forecast that Internet traffic will increase five-fold by 2013, service providers actually will need to plan for a seven-fold increase in Internet traffic to accommodate traffic peaks as seen above.
US Game Sales Are Up, Sony PS3 Leads for First Time
Excerpted from Digital Media Wire Report by Mark Hefflinger
PlayStation 3 for the first time ever led US videogame sales in September, which on the whole rose 1% from a year ago after several months of decline, according to sales figures compiled by market research firm NPD Group. Overall sales were $1.28 billion in September; despite Sony's success, game hardware sales fell 6% from a year ago, to $472 million.
While Nintendo's DS handheld led all hardware sales with 524,200 units, the PlayStation 3 led among consoles with sales of 491,800 units; Nintendo sold 462,800 Wiis and Microsoft sold 352,600 Xbox 360s.
"Compared to last September, the PS3 was the big winner, more than doubling last year's sales," said NPD analyst Anita Frazier.
"This portrays a very strong consumer reaction to the price decrease as August and September both realized a lift of more than 70% over the prior month. This is the first month that the PS3 has captured the top spot in console hardware sales."
Overall game sales were up 5% last month from a year ago, to $649.3 million.
September's top-selling game was Microsoft's "Halo 3: ODST" (1,520,000 units).
Also placing in the top ten were Electronic Arts' "Madden NFL 10," MTV Games / Electronic Arts' "The Beatles: Rock Band," and Activision's "Guitar Hero 5."
Game on! Harris Interactive Dishes the Data on Trends in Gaming
Joe Porus and Milt Ellis, Research Vice Presidents at Harris Interactive, participated Thursday in a leading industry conference focusing on the trends and future expectations in the gaming and P2P arenas.
Speaking at the P2P & GAMES CONFERENCE, a special event at Digital Hollywood, Porus and Ellis revealed their findings and concluded that the future of gaming and P2P looks bright.
Based on their research findings, more than half of adults are already gamers with many favoring sports games (22%) or strategy and simulation games (22%). Currently, most gamers use their computers to play (75%); however more than a quarter (28%) are using their mobile-phones or smart-phones, and that number is likely to increase with the continued improvement of mobile devices.
The interest in P2P gaming is certainly on the rise, with half of adults stating interest in the concept of installing an application on their computer to connect to a shared gaming environment. 41% of adults are aware of P2P networks being used for sharing videogame files or applications, while more than half are aware of using them to share music (55%) and half are aware of sharing videos or movie files.
"There is the opportunity to see an increase across the spectrum of gaming platforms, as the appetite for gaming is truly growing," stated Porus. "The gaming and P2P landscape is shifting and will continue to do so as netbooks and smart-phones evolve."
Report from CEO Marty Lafferty
 Congratulations to Victor Harwood and his team for a successful Digital Hollywood Fall (DHF), infused with fresh energy from Variety and EPPS session additions. And special thanks to all who helped make our first-ever P2P & GAMES CONFERENCE a stimulating and valuable event within DHF.
Prior to the conference, P2P-for-Games Working Group (PFGWG) Co-Chairs Rick Buonincontri and Rich Roberts convened a productive working meeting of the group, which is making excellent progress on its first work product.
Games publishers and P2P/cloud software distributors are welcome and encouraged to join the PFGWG. Please call +1-410-476-7965 or e-mail PFGWG@dcia.info to sign-up or for more information.
Abacast Co-President Jim Kott opened the conference with a P2P industry outlook that outlined recent traction in three key areas in addition to games: enterprise live video, exemplified by Abacast's partnership with fellow DCIA Member Ignite Technologies now providing services to Bank of America (BoA); high-quality audio, exemplified by Abacast's reduction of radio-station content delivery network (CDN) costs to distribute 250K listening hours/month from over $4K to under $700 - while noticeably improving bit-rate; and high-quality video, exemplified by Abacast's service to Seoul Broadcasting System (SBS) saving it 14GB/second in bandwidth needs for broadcast quality video delivery using Abacast's peer-assisted solution.
Hudson Square Research Principal Scott Tilghman followed with a games industry outlook underscoring the sheer size of the opportunity with 65% of American households (USHH) now playing digital games, and with revenue exceeding theatrical box-office for motion pictures for the first time in 2008. More people within homes are connecting with games, and the teen-male segment of the game-playing demographic is now down to 18%.
China represents a huge market (298 million) for online games, which are typically accessed at Internet cafes. Globally, game-capable PCs and networked game consoles (all 3 top sellers are now network-ready but only 5% of delivery is digital) are both very viable as platforms for P2P game delivery. PCs outnumber current consoles by 10:1 (and prices are comparably different), and sales of mobile units each year (1 billion) are equal to the total installed base of PCs. YTD US games publishers stocks are up an average of 38%.
Solid State Networks (SSN) CEO Rick Buonincontri teed-up the conference themes of consumer and content protection issues, and traced his company's experience for the past five years in serving the growing market for games and game-update distribution via P2P technologies. Games publishers have reacted to P2P in interesting ways at times. SSN's first customer was far more interested in the improved performance (e.g., delivery speed) that SSN could provide versus a traditional CDN than in the cost savings SSN also offered.
As recently as 2005, one major publisher was only interested in anti-piracy solutions related to P2P rather than the higher-quality, lower-cost, more-secure attributes of P2P as a distribution medium. Two of Rick's four examples of key learning in this space were the pioneering work in Asian markets of free-to-play P2P games as a baseline offering with micro-transactional enhancements as the means for monetization, and Blizzard's use of P2P to make "World of Warcraft" an enormous massively multiplayer online (MMO) success.
Rick also sounded a key note that was echoed by other speakers throughout the conference: how P2P/cloud software developers can partner with games publishers to further reduce the "friction" in the consumer-acquisition-to-game-play process (i.e., the steps involved in downloading, registering, installing, etc. that tend to impose wait-time on gamers anxious to begin playing their games).
Harris Interactive VPs Joe Porus and Milt Ellis introduced their new market-focused research derived from a polling base of 2,500+ respondents centering on this category's newest segment - mobile gaming - with new data on the broader area of P2P and games. 31% of teens (13-18) are already playing mobile games, with an additional 45% expressing interest in playing. Better game selection, graphics, and faster gameplay will drive further adoption. 47% want to be able to transfer their games among devices (i.e., consoles, PCs/laptops, netbooks, mobile).
Sports and strategy simulation top game genres today. 72% of all game playing is done on PCs, 64% on consoles, and 29% on hand-held devices, while mobile has very quickly grown to claim 28%. For MMOGs, 77% is on PCs versus only 3% on consoles. 11% of respondents would definitely download a P2P application to get their game(s), and 23% are somewhat receptive to the idea. Top reasons P2P is already used by consumers are for new content (31%) and for otherwise unavailable content (26%). 49% of respondents feel that P2P is already mainstream and comparable to other distribution methods, while another 13% feel it is more cutting-edge.
Yummy Interactive Director of Software Distribution Chris Hennebery announced that Facebook has become the number-one gaming portal in terms of overall volume, with the average game life-cycle two months, and that Flash is now the top game authoring platform, with the fewest barriers to adoption. Cloud computing acts as both a platform and application for games, rendering PCs into mere access points (net appliances) and turning computing into a utility.
Advantages of moving to this new paradigm include scalability, extensibility, no more versioning, no more reliance on local hosting, avoiding post-sale channel conflicts, simplified support, and the elimination of infringement. Intelligent PP2 enhances these benefits by routing data requests to the nearest available source of content components. Google has overcome a drawback with its data liberation front (i.e., downloading and making portable cloud-based content). Netbooks represent a particularly attractive opportunity, with a 400% increase in sales in the last two quarters.
Asankya VP of Business Development Norman Henderson described his company's multi-path networking solution as not only more secure and higher performance than TCP/IP, but also as changing it. Cloud computing has evolved from the initial computing and storage phases of development and is now at the networking stage. Forward thinking gaming companies have begun to figure out that adding more bandwidth is not what is needed to boost performance. The problem is no longer in the last-mile, but more in the middle-mile, and existing protocols are just not as efficient as what will be needed to improve performance.
The games industry is clearly moving from a console-based business model to a network-based model where cloud-hosted / P2P enhanced delivery will be the norm and where interactivity and collaboration will be much more integrated into the game-playing experience. Mobility will also become more prevalent. In terms of gaming cloud metrics, Asankya's track record is to improve performance between three and forty-times that of traditional distribution, featuring encrypted, two-way, UDP as well as TCP/IP delivery.
BitTorrent VP Marketing and Product Simon Morris declared that "P2P should be free." This should not be misinterpreted that P2P-delivered games should be free, but rather that there should not be a charge for the P2P software itself, because of its cooperative characteristics (e.g., user bandwidth sharing and other resource contributions). The analogy could be made that if you borrow someone else's watch to tell what time it is, you should not also try to rent the watch to yet another party. P2P is attractive for game distribution because it is more robust and reliable than alternative methods, and delivery metrics can be more detailed and accurate. In addition, the user experience can be much less constrained.
Games marketers don't need to change their CDNs to implement P2P, they will just be able to pay them less. P2P can leave games publishers securely in control of their content, and is hugely scalable. BitTorrent's global traffic now accounts for two terabits per second and its DNA content delivery offering will feature three enhancements that should be very attractive to games publishers: adoption of the UTP protocol (analogous to driving with your eyes open versus TCP/IP with your eyes closed); BT open source (under an MIT license); and all BitTorrent clients being enabled to handle DNA content.
Music Mogul Founder and CEO Nicholas Longano presented the very exciting concept for a new totally immersive 3D virtual world focusing on personalized avatars interacting in deep and entertaining ways with new artists and other characters in a variety of venues. The possibilities of how this amazing environment - it is much more than a game - can be tapped by consumers, performers, advertisers, content industry interests and others are almost limitless.
Virtual worlds are a rapid growth category expanding from 35% last year to 200% this year and reaching $1 billion in revenue in the US this year. P2P marketing and distribution represent the wave of the future and will be increasingly important to Nicholas' offering and others going forward. What distinguishes Mogul World will be its globalized and purpose-driven experience.
Finally, Pando Networks CEO Robert Levitan provided a fascinating snapshot of the company's experience with P2P delivery of games; specifically, looking at performance metrics of 20 games delivered by Pando software in 190 countries through 8,338 Internet service providers (ISPs) over a period of 60 days, during which more than 2 million downloads took place. The overall averages include speed attained 429KB/s, file size 917 MB, duration 68 minutes, and completion rate 87.25%. The top ten P2P gamer-friendly countries (likely to complete game downloads) were led by Japan at 94.12% and tailed by the US at 87.62%, with most cancellations occurring when less than 10% of a game has been downloaded.
Robert provided details of top US states as well as best-performing ISPs, which were quite surprising. The poorest performing locations were in Brazil. He also shared statistics tracing download duration versus asset size, ranging from 16 minutes for 128-256MB to 267 minutes for 2-4GB games. Pando defines efficiency as the percentage of content delivered via peers versus central servers and, with P4P and Pando Network Aware (PNA), the company is achieving some astonishing results for its customers. Examples include 95% in the Maldives (the highest), 86.51% in China, and 83.33% in the US.
In this report, we have been very pleased to highlight conference keynotes, and next week we will focus on the panel discussions. Many of the presentations are now posted online here, and we will also alert DCINFO readers when post-production has been completed by Abacast and the archival webcast is available for viewing. Share wisely, and take care.
Web 2.0 Attracts Much More Venture Capital than Any Other Category
Excerpted from IBL News Report
Venture capital investing might be bouncing back, but the latest numbers from Dow Jones VentureSource are a bit disappointing. VCs invested $5.1 billion in 616 deals during Q3, down from $8.2 billion invested during the same period last year, a drop anyone would expect.
Looking closer at the numbers, there is good news for our Internet industry, however. Information technology (IT) now takes the top spot in attracting money. Last year, it was overshadowed by health care, but IT now leads VC attention.
And within the IT umbrella, Web 2.0 investments are not only continuing but in fact are beating traditional software investments for the first time.
VentureSource says Web 2.0 deals increased 11% from last year, for a total of $627 million in 86 deals.
On the other hand, investment in renewable energy, another industry that looked like the winner in terms of VC, fell 73% to $343 million.
Avoiding Identity Theft and Online Scams Just Got Easier
Every day, identity thieves are getting smarter at tricking people into revealing their account numbers, passwords, social security numbers, and financial information. Last year, they racked up 9.9 million fraud victims who lost an average of $4,849 in each incident. And potential victims are not always Internet novices, as recently evidenced by FBI Director Robert Mueller, who admittedly almost fell victim to a phishing site that posed as his bank.
Working within highly organized e-fraud cartels, today's criminals are outwitting web-savvy consumers by luring them to web pages that look real but aren't. They're phishing sites - clever copies of the real thing designed to capture sensitive personal data to be used maliciously by the phisher or sold to the highest bidder on the global black market.
But armed with the right information, consumers can protect themselves - and their valuable personal information.
That information is freely available on TrustTheCheck.com, a website devoted to helping consumers keep safe as they surf the web. Created by VeriSign, the trusted provider of Internet infrastructure for the networked world, TrustTheCheck presents tips and techniques consumers need to safely shop, bank, trade stocks, and book travel online.
In addition to drawing on VeriSign's vast knowledge base in online trust, TrustTheCheck makes information accessible from a variety of independent sources, including the Federal Trade Commission (FTC), Parent-Teacher Associations (PTAs), and many others. In addition to guidance on securing personal information, the site allows visitors to Take the Fake Site Challenge, an eye-opening experience that reveals just how similar many fraudulent sites are to the real thing.
The site also allows visitors to take a crash course on staying safe on the web; hear real stories and view videos of real people reliving their own web security nightmares; ask the community questions about identity protection, viruses and worms, encryption, and more. Visitors can also use the community forum to report phishing e-mail or online scams.
Visitors to TrustTheCheck seek out information about all kinds of web security topics, from keeping kids safe online to understanding the risks of social networks. Here are the 10 most popular: phishing, secure sockets layer (SSL), https, trusted sites, two-factor authentication, fraudulent sites, security risks, identity protection, web browser security, and keeping kids safe online.
TrustTheCheck features a range of other related resources, including desktop widgets, a dictionary of security terms, and a primer for businesses looking to build trust online.
Wowd Takes a Stab at Real-Time Search with a P2P Approach
Excerpted from TechCrunch Report by Erick Schonfeld
A new real-time search engine called Wowd launched publicly this week in San Francisco, CA. Wowd takes a very ambitious approach to search in that it is a P2P search engine. Users download a P2P client and the index exists not on any central cluster of servers, but across all users' machines.
Founder & CTO Boris Agapiev, who formerly founded the vertical search engine Vast, set out to conquer scaling issues in a new way and settled on a P2P approach.
What makes Wowd a real-time search engine is that it ranks sites based on how often and recently the Wowd community has visited them.
The search engine uses other more traditional ranking algorithms as well, but its main point of differentiation is the real-time clickstream data it gets from the P2P clients, which it wants users to download. In theory, this will provide Wowd with a user's complete attention history if the user allows it - every site visited, not just the ones clicked to from the search engine (in this regard, it is similar to what the Google toolbar records if the "Web History" feature is enabled).
As with any attention recorder, Wowd offers a full range of privacy settings so that users can share only what they wish, and it is all anonymized and Wowd doesn't capture IP addresses. Users can review and search their entire web histories.
For those who download and use Wowd, they will see search results ranked based on which sites are most popular with the Wowd community. Sites that have been visited recently get a stronger weighting. Users can also switch to see the freshest results. The quality of the results depend on the Wowd community's finding and visiting the best sites, but it is all based on passive activity. Wowd's results won't be as susceptible to SEO spam as other search engines.
Real-time search is hot right now, with several start-ups (Collecta, OneRiot, Topsy) as well as larger companies like Twitter, Facebook, and Google going after it.
"Ear to the Ground: Nashville" Now Available From LimeWire Store
Excerpted from Nashville Scene Report by Steve Haruch
The folks at the LimeWire Store approached the "Scene" about doing a free sampler of Nashville bands for their website, so what do you think we said?
Go here right now, as in immediately, and download "Ear to the Ground: Nashville" for free.
How easy is that? It's got songs by Cortney Tidwell, How I Became the Bomb, The Dynamites Featuring Charles Walker, Jensen Sportag, The Privates, Kidsmeal, Those Darlins - you know, the good stuff.
If you're squeamish about a free download, you can preview all the tracks by clicking the big "Play" button under the compilation artwork.
So enjoy. There are similar samplers up for other cities like National League Champion Philadelphia and Cy Young Award-harboring San Francisco, but first things first, people. First things first.
Spotify Adds One-Click Download Feature to P2P Streaming Music Service
Excerpted from IT ProPortal Report by Desire Athow
In a move aimed at easing the concerns of many in the music industry and paving its way into the US market, leading P2P streaming music service provider Spotify has started offering a single click download feature for buying music tracks on its platform.
Spotify has tied up with 7digital to offer tracks for download, and the option for buying music will allow its users to purchase quality MP3 tracks that come at 320Kbps.
An interesting aspect of the download feature is the fact that once a user purchases a track, it is added into his/her online Spotify collection as well as being downloaded onto his/her local computer.
This gives users the flexibility to access their music collections from any system connected to the Internet or to re-download the purchased tracks in case they have accidentally been removed.
With Spotify adding a purchase option on its platform, many analysts believe that this will serve as a viable revenue model for the music service, which primarily runs as an advertising-supported model.
Moreover, the buy option also allows the company to bring itself more in tune with the music industry's commercial practices in many countries including the US, where it may be planning to roll-out services in the near future.
Zetta Opens Its Storage Cloud to All
Excerpted from PC World Report by Stephen Lawson
A cloud storage provider that designed its system from the ground up to meet enterprise needs is ready to offer its service to the world.
The Zetta Enterprise Storage Cloud, from Sunnyvale, CA, start-up Zetta, is set to enter general availability after months of beta testing, evaluations, and use by a limited set of customers.
Zetta is designed as cloud storage specifically for enterprises, with features such as encryption and data integrity checks that set it apart from offerings such as Amazon S3, according to Co-Founder and CEO Jeff Treuhaft.
Founded early last year, Zetta is going after a relatively new task in cloud storage, offering to handle enterprises' primary storage instead of just back-ups and archives. It's a daunting task to take on the original copies of customers' important data, but the realities of building and running an in-house data center are starting to weigh on enterprises, especially in a challenging economy, some analysts say. Still, companies are just starting to get used to the idea of handing off this component of IT to a third party.
Zetta claims it has solved the problems of enterprise cloud storage by building its software and hardware infrastructure specifically for multiple customers and for distributed computing. Vendors that have tried to offer such services in the past just took equipment designed for individual enterprises and used a thin layer of software to adapt it to a multi-user service platform, according to Treuhaft. That prevented the earlier vendors from scaling up their services to meet demand, an issue that has only grown more important as the growth of stored data accelerates, he said.
Zetta began by developing its own file system, but not a special application programming interface (API) for sending data to the cloud. Customers can address Zetta's storage using standard file systems such as common Internet file system (CIFS) and network file system (NFS). Its platform also includes features most IT departments are used to in their own environments, such as encryption, data integrity checks, the ability to retrieve snapshots of data over time, and eventually replication between two specific geographically dispersed Zetta data centers.
Because of its robust infrastructure, the company can offer higher service-level agreements (SLAs) than can other cloud storage providers such as Amazon's S3, Treuhaft said. Enterprises have embraced the promise of that kind of service, he said. Nearly 50 companies participated in a beta test that began last December, and some of those plus other potential customers picked out by Zetta became paying customers after commercial service was begun in July.
Equinix, a global provider of collocation services, has been testing Zetta's service and hopes to use it for its own internal Microsoft SharePoint data. The Zetta cloud provides a resilient enterprise-class infrastructure that offers lower cost and faster deployment than building internal storage capacity, said CIO Brian Lillie. "These guys know what they're doing," Lillie said.
YourBitTorrent Continues Where MyBitTorrent Left Off
Excerpted from TorrentFreak Report
Founded in early 2004, myBitTorrent grew to become a prominent and well-established torrent site. Its two founders frequently changed the look and layout of the site.
The two changed plans so often that they never really managed to add new features to the site. "Instead of adding new things, we were always spending time fixing features that used to work," Rex, one of the site's founders told TorrentFreak.
Nevertheless, myBitTorrent grew to become one of the largest torrent sites, serving torrents to millions of visitors every month. This popularity, together with increased legal pressure against fellow torrent sites such as The Pirate Bay (TPB) and Mininova, raised doubts with Rex's partner, who wanted to scale down.
Eventually this led to a rift between the two owners. Rex wanted to continue with the site, but his partner opted to close down the operation. To resolve the dispute, the two decided to go their separate ways. This summer myBitTorrent shut down, but not before a replacement was in place.
To fill the gap left by myBitTorrent, Rex launched a new site under a new name - yourBitTorrent.
"The biggest difference between the sites is that yourBitTorrent has verified and adult torrents," Rex told TorrentFreak, adding that he plans to include many new features in the near future, including an integrated subtitle search engine.
"YourBitTorrent will soon have a few million subtitles and IMDB-links linked to all movies and TV-shows. The advanced search will also be extended to allow people to look for subtitles. YourBitTorrent is going to be the first site where you can do that," Rex said.
Another key feature is that the site will verify torrents to prevent the appearance of fake files and spam. "YourBitTorrent has its own verification system with 60,000 verified torrents, and unlike some other torrent sites, we take measures against fake files," Rex told TorrentFreak.
Pirate Party Hopes for Free Future
Excerpted from BBC News Report by Ian Youngs
The Pirate Party, a political movement born out of music file sharing, has gained support in Sweden and Germany, and is planning to field candidates in the next UK general election. It wants to encourage all file sharing and slash copyright - to the horror of many artists and entertainment executives. So are they a significant force or a fleeting bunch of freeloaders?
If Rick Falkvinge did not already know what the music industry thought of him, the Pirate Party founder found out at the "In The City" music industry conference in Manchester. One delegate offered to "burn him at the stake", while another called him "seriously manipulative".
"Some very important people in the music industry have been shouting at me for the last month," said "In The City" organizer Yvette Livesey of her decision to invite Mr. Falkvinge to the event. "But I think it is important to have these debates. If we'd had these debates 10 years ago, perhaps we wouldn't be in the position we are in now in the music industry."
The Pirate Party is so controversial because many believe its philosophies - if it ever came close to power - could wreak havoc on creativity and ruin the entertainment industry.
Mr. Falkvinge started the Pirate Party four years ago in Sweden in response to a crack-down on file-sharing services, taking inspiration from the hugely popular, but unlicensed service The Pirate Bay (TPB).
TPB's legal challenges in Sweden rallied support for the movement and the Swedish Pirate Party attracted 7% of the Swedish vote in June's European election, where it was the most popular party among first-time voters.
In the German general election last month, the German Pirate Party won the support of 13% of first-time male voters, and Pirate Parties have now sprung up in 32 countries.
Although they share objectives, the national parties are not formally connected.
"This is not just something that has fringe appeal," Mr. Falkvinge says. "We are talking about being the largest party for the next generation of voters." The music business has spent the last decade fighting file sharing as unauthorized Internet traffic has snowballed and global album sales have plummeted. And the issues stretch far beyond music to film, TV, and publishing.
The main attraction for Pirate Party followers, Mr. Falkvinge says, is the proposal to make file sharing not only authorized but actively encouraged. It also wants to drastically cut copyright, the legal protection that allows writers, performers, record labels, and other rights holders to exclusively profit from their creations. The Swedish Pirate Party wants to reduce copyright to five years, from the current position of at least 50, while the UK branch is likely to recommend 10 years in its manifesto.
Objecting to the prospect of digital communications being searched by authorities for copyrighted material, Mr. Falkvinge also describes his party as a "civil liberties group." File sharing will never be stopped, he believes.
Please click here for the rest of the report.
70% Oppose ISP Unauthorized File-Sharing Disconnections
Excerpted from ISP Review Report
The Open Rights Group has posted the results of a new YouGov survey, which found that, in the UK, just 16% of those surveyed would be in favor of an Internet service provider (ISP) disconnecting customers "suspected" of involvement with the downloading of an unauthorized file (music, film, etc.).
The majority (68%) said suspects should have the right to a fair trial in a court of law, prior to restrictions being applied. The survey also revealed that nearly 44% would be less likely to vote for any political party that supported a policy of disconnection.
Elsewhere music artists recently softened their position on disconnection to favor service limitations (slower speeds, blocked sites, etc.) over a direct cut-off policy.
ISP Shows Why IP-Address-Based Disconnections Are Dumb
Excerpted from TechDirt Report by Mike Masnick
UK Internet service provider (ISP) TalkTalk has been a strong critic of the way the record industry has tried to turn ISPs into copyright cops in the past. A year-and-a-half ago, it swore it would not be a copyright cop, and scolded BPI for suggesting it had any responsibility to enforce the entertainment industry's poor excuse for a business model - while also complaining about "the most unbelievably rude letter" that BPI sent TalkTalk in demanding it do so.
At the time, its CEO Charles Dunstone told them, "They're not just shutting the stable door after the horse has bolted - the horse has left town, got married, and started a family."
Then, earlier this year, Dunstone also pointed out how naive it was to think that the industry could do anything to stop unauthorized file sharing, noting, "If you try speed humps or disconnections for file sharing, people will simply either disguise their traffic or share the content another way. It is a game of Tom and Jerry and you will never catch the mouse. The mouse always wins in this battle, and we need to be careful that politicians do not get talked into putting legislation in place that, in the end, ends up looking stupid. If people want to share content, they will find another way to do it."
TalkTalk is continuing to show how silly the record industry's plans are, by doing a little demonstration. The company sent out a security expert on staff to an ordinary street in Stanmore, Middlesex. Then it had him find all the Wi-Fi connections there - noting that many were totally open, and many others used weak security. From a few open ones, he downloaded some songs including Barry Manilow's hit "Mandy" and the soundtrack to the 1992 film "Peter's Friends" - two choices in honor of Peter Mandelson, the UK Business Secretary who suddenly became a supporter of kicking file sharers off the Internet using a three-strikes provision after dining with entertainment industry mogul, David Geffen.
To be clear, in this case, the music downloads were both done legally - and the company checked with the Wi-Fi access point owners first to make sure they were okay with it - but the point is still clear. Just because you have an IP address, it doesn't act as any sort of proof.
TalkTalk's Director of Strategy and Regulation, Andrew Heaney made the point clear: "The Mandelson scheme is every bit as wrong-headed as it is naive. The lack of presumption of innocence and the absence of judicial process combined with the prevalence of Wi-Fi hacking will result in innocent people being disconnected."
This, of course, is the same point that plenty of people have been making for ages, but the record industry never has a good response.
They also haven't been able to respond to a more important point: how will kicking people off the Internet make anyone more interested in buying music?
55% of 16-24 Year-Olds Believe File Sharing Should Be Authorized
Excerpted from ZeroPaid Report
The UK's Office of Communications (OfCom), regulator for the communications industries in that country, recently published a report on the state of media literacy among adults aged 16 and over.
Conducted during this past spring, the report shows that the population is more connected than ever before with three-of-four adults saying they used the Internet at home or elsewhere in 2009 (75%), compared to two-thirds (63%) in 2007 and three-fifths (59%) in 2005.
One-in-three UK adults who use the Internet (29%) say they are watching online or downloading TV programs or films. Almost all of these are doing so through UK TV broadcasters' websites (such as BBC iPlayer) (27%), with a much smaller proportion watching online or downloading TV programs or movies from other websites (9%).
The majority of young adults, those aged 16-24, say file sharing should be authorized (55%).
Adults aged 65 and over are more likely than adults as a whole to say they don't know (37% vs. 25%) if it should be authorized or not, and this is also true of females compared to males (29% vs. 21%).
What's interesting is that the study also says the same group of adults that think file sharing should be authorized (16-24 year-olds) along with those aged 25-34 are also more likely than all adult Internet users to download or watch TV programs or films online (40% and 43% vs. 29%).
By contrast, downloading or watching TV programs or films online is relatively uncommon among Internet users aged 55 and over (11% vs. 29%).
What this means is that so long as there's a gap between licensed content available online and what consumers are demanding, file sharing will always be the solution.
It's perhaps why many think it ought to be authorized.
End of the World as Hollywood Knows It
Excerpted from CNET News Report by Greg Sandoval
Cut your spending. Save your money. Many of the revenue streams that have gushed into your industry for decades, some for nearly a century, are about to dry up. This will likely mean a period of belt-tightening like you've never seen before.
The end is coming for DVDs, traditional movie rentals, and yes, much of your cable money will likely disappear.
The news isn't entirely bad; you still have iTunes and Netflix - places where people spend money to buy or rent movies. You still have Hulu, Crackle, and YouTube, which are generating ad revenue by streaming full-length films and TV shows online. But the reality is that the amount of money that these operations generate is far less than the returns your industry is used to making.
Unless some dramatic technological breakthrough occurs that can defeat file sharing, then you are staring at checkmate. Your business is headed for the same meat grinder that has chewed up the recorded music sector and print publishing. What will come out the other side is still uncertain but will likely be much smaller.
I'm sure many of you will write this off as the apocalyptic rantings of Silicon Valley propeller heads. But I urge you to pay attention to recent events.
Over the past five days I've been in Los Angeles talking to entertainment attorneys, studio executives, and some of the tech vendors who do business with the studios. I've been covering the sector three years now and I've never seen people in the film industry so dejected.
DVD sales are falling, the number of upcoming film releases is expected to drop. Some big shots have even acknowledged the bleak situation in public. The past weekend, at a conference on the USC campus, Disney CEO Bob Iger said, "The business model that formed the motion picture business is changing profoundly before our eyes."
Iger warned that studios must make profound changes, "or you will no longer have a business."
Earlier this month, Francis Ford Coppola, the director of "The Godfather" said at the Beirut Film Festival that "the cinema as we know it is falling apart." He also predicted several of the studios would go out of business.
Of course, not all of your industry's problems were caused by the web. Hollywood has paid creators handsomely over the years and costs have skyrocketed. Then there's the problem with Blu-ray. Iger noted that consumers aren't upgrading their DVD collections with Blu-ray discs to the degree that the industry had hoped.
But if you're really inclined to wag a finger, there is nothing disrupting your business more than the Internet. The MPAA has worked hard to force file-sharing sites out of business or push them to the web's fringes. At first, the studios tried to kill file sharing with lawsuits. Then they hired security firms, such as MediaDefender and MediaSentry, which promised to discourage file sharers by blocking or slowing the sharing process. None of that worked.
Maybe that's one reason the MPAA overhauled its "anti-piracy" operations three weeks ago. CNET reported on Friday that the studios' trade group decided to change the name of the "anti-piracy" unit to "content protection" and fired three leaders, including the MPAA's general counsel.
And now, snatching an unauthorized film or TV show doesn't require knowledge of torrents. There are scores of sites that stream movies and TV shows over the web and a viewer doesn't have to actually download the movie to their hard drive.
I spoke to someone at the studios last week who said these sites are tougher to fight because they can crop up anywhere and many are based overseas. Often, said the source, "We don't know where they are."
What is happening is that the consumption of unauthorized content appears to be moving out of dorm rooms and into the living rooms of average Americans. Here is what you're up against:
A 28-year-old woman I'll call Alexandra (she asked for anonymity) grew up in Missouri, graduated from college, attends church every Sunday, and told me that she watches episodes of the hit cable show "Mad Men" at least twice a week at Surfthechannel.com, a site that hosts links to many unauthorized clips. She gleefully said that visitors can find almost any TV show they want and not pay a dime.
Alexandra said a friend told her about Surfthechannel a year or two ago and she watches shows there because she doesn't want to pay for a cable subscription, or a TV, and because it's so easy.
She explained that she is not a bad person and that "everybody is doing this." She says one of her professors told her "he and his wife sit at home on the weekends and enjoy movies they download (without authorization) off the web."
I ask her if she has tried Hulu, the popular video site created by News Corp. and NBC Universal. The site offers a few feature films and lots of TV shows free to viewers and pays for them by serving ads. She said she had visited Hulu but added that "there's more of the stuff I want at Surfthechannel."
Alexandra's statements about Hulu come at a time when the site's backers are mulling whether to build a pay wall around some of its content. Alexandra and people like her aren't even accepting Hollywood's offer of free content because unauthorized sites offer better selections.
What do you think will happen if Hulu begins charging?
Don't get me wrong. I understand that the returns at Hulu are probably much smaller than what the studios are accustomed to getting. There's also the problem of growing dissatisfaction among the cable operators. How long will they continue to pay big bucks if more of their customers dump their subscriptions in favor of sites such as Hulu? Leaving a business that generated billions for one that makes far less would be hard for anyone.
But the possibility that studio chiefs must consider is what if the money offered by iTunes, Hulu, and Netflix is all that a digitally ravaged media world offers.
Eric Garland, CEO of BigChampagne, a company that tracks file-sharing usage and sells the data to the studios and major record labels said, "Hulu may be doing immediate harm to elements of your business, but waiting right behind Hulu in the shadows, are things that do so much more harm."
Coming Events of Interest
Digital Media Conference West - October 28th in San Francisco, CA. A packed day of in-depth discussions and networking focused on the top business issues impacting digital media companies, including online video, social media, investments, online advertising, mobile entertainment, mobile apps, the future of news media and the relationship between Hollywood and Silicon Valley.
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.
Future of Television East - November 186h-19th in New York, NY. Join television industry leaders including senior decision-makers from major broadcasters, production studios and cable networks, social networks, producers, creators, mobile companies, online content producers, distributors, technology companies, and association heads - for the industry's most prestigious event.
P2P MEDIA SUMMIT at CES - January 6th in Las Vegas, NV. The DCIA's seminal industry event, featuring keynotes from top P2P and cloud computing software companies; tracks on policy, technology, and marketing; panel discussions covering content distribution and solutions development.
2010 International CES - January 6th-10th in Las Vegas, NV. The industry's largest educational forum to help companies expand their businesses and understand new technology. Over 200 conferences and more than 300 expert speakers encompass International CES.
Media Summit New York - March 10th-11th in New York, NY. MSNY is the premier international conference on media, broadband, advertising, television, cable & satellite, mobile, publishing, radio, magazines, news & print media, and marketing.
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