December 14, 2009
Volume XXVIII, Issue 12
The P2P MEDIA SUMMIT at CES Is Coming Soon
The P2P MEDIA SUMMIT at CES on Wednesday January 6th will feature keynotes from top peer-to-peer (P2P), social networking, and cloud-computing software companies; tracks on policy, technology, and marketing; and panel discussions covering content distribution and solutions development. Enterprise deployment as well as consumer adoption trends will be covered.
Register now for the 2010 International Consumer Electronics Show (CES) and sign-up for the extraordinary P2P MEDIA SUMMIT. Don't miss this seminal industry event being held once again at the Las Vegas Convention Center. There's no better way to get a head-start on what to expect from the forefront of online service development in the New Year.
A key theme will be the use of P2P and cloud computing for games. DCINFO readers can now view Abacast's archival video of the DCIA's first special event on this topic here.
Josh Silverman, CEO of Skype, the P2P industry's greatest financial success, will also deliver the keynote address at the Leaders in Technology Dinner (LIT) at CES on Friday January 8th.
Federal Communications Commission (FCC) Chairman Julius Genachowski will be interviewed in a keynote by Consumer Electronics Association (CEA) President Gary Shapiro earlier that day.
The DCIA is an allied association of the CEA.
Largest Sale of Cloud Computing Company to Date
Excerpted from Cloud Computing Journal Report by Salvatore Genovese
Dolphin Equity Partners recorded one of the largest single returns for limited partners among venture capital investors in 2009, and the largest sale of a privately held cloud computing company with its fourth-quarter sale of longtime investment Gomez to Compuware Corporation, firm President Richard Brekka said at today's annual limited partner meeting.
Compuware's $295 million cash acquisition of Gomez realized $93 million for Dolphin investors, a 770% return. Dolphin was Gomez's largest shareholder and first invested in the company in 2000, when it saw an opportunity to build on Gomez's nascent web-performance monitoring assets and its then-pioneering delivery via the software-as-a-service (SaaS) model.
"Dolphin is committed to looking for long-term investment opportunities that have huge potential payoffs, especially among SaaS technology providers," Brekka said. "With our hands-on approach to helping find and support the right management teams, we've been able to create some truly innovative companies that have delivered real returns for our investors."
The Gomez acquisition is the latest in a series of increasingly high-quality exits for Dolphin portfolio companies over the past few years, including Enpocket (sold to Nokia in 2007) and MaxPreps (sold to CBS in 2007).
LimeWire Store Works to Benefit Amnesty International
To coincide with International Human Rights Day on December 10th, LimeWire Store released "Live at Lime with Tom Morello." The Grammy Award-winning Morello performed two outstanding covers: "Human," originally released by The Killers in 2008, and "Joe Hill," a classic folk song based on a poem written by Alfred Hayes in 1925 about Swedish-American labor activist Joe Hill. In keeping with his dedication to human rights, all net proceeds from "Live at Lime with Tom Morello" are going to Amnesty International, an organization Morello proudly supports.
"Live at Lime with Tom Morello" was recorded and mixed at Galt Line Music in Los Angeles, CA by Eric Robinson and produced by Marshall Altman. Tom Morello performs guitar, harmonica, and vocals on "Joe Hill" and "Human." "Human" also features David Gibbs on guitar and Eric Robinson on piano.
An accompanying video interview features musician, artist, and activist Henry Rollins in an exclusive conversation with Morello. Taped on the day of the recording, the interview features Rollins and Morello in the studio discussing a wide range of issues including Morello's involvement with Amnesty International, activism in music, and President Obama.
"It's not every day you get to assemble such a high-caliber group of folks and produce something as cool and meaningful as this Amnesty benefit," said Tom Monday, LimeWire's Director of Partner Relations. "Morello really walks the walk - he speaks his mind and supports causes close to his heart. We're beyond excited to be working with him. And having Henry Rollins participate is absolute gravy."
Karen Scott, Amnesty International's Music for Human Rights Program Manager, said, "The people at LimeWire Store have been a pleasure to work with and everyone involved put their heart and soul into this project. Both Tom Morello and Henry Rollins are dedicated activists and supporters of Amnesty International and the fight for Human Rights. You can really hear and feel their passion both in the music and in the interview."
Report from CEO Marty Lafferty
 We commend the progress report on the Open Government Initiative released Tuesday by the Office of Management and Budget (OMB).
The entire Obama Administration is moving forward as promised with broad measures to translate the values of openness into lasting improvements in the way government makes decisions, solves problems, and addresses national challenges.
We urge DCINFO readers to review this analysis on the steps already taken to increase transparency and new actions now on the horizon.
Meanwhile, the DCIA, among a number of interested parties in the technology sector, must take exception to the fact that "The Informed P2P User Act" (HR 1319), a misguided and potentially harmful measure, passed by undocumented voice vote in the US House of Representatives this week under a suspension of the rules.
This bill was instigated, reintroduced, and underwritten by richly financed opponents of our industry through three successive sessions of Congress, ignoring substantial efforts made in the meantime by software developers in good faith to address the concern this measure purports to confront.
The history of HR 1319 belies the fact that its real purpose is to slow the proliferation of innovative technologies that threaten obsolete business models for the distribution of audio and video content, not to protect file sharers.
Meanwhile, we are continuing our proactive support of concerted self-regulatory action led by the Inadvertent Sharing Protection Working Group (ISPG), which by any objective criteria represents a much more beneficial approach to addressing the subject concern, is making significant progress, and has already helped countless consumers.
The court conviction and sentencing this fall in Seattle, WA of an individual, who misused file-sharing software to commit computer fraud and identify (ID) theft, underscores the concern that the distributed computing industry is seeking preemptively to address. But to put this issue in perspective, US consumers and businesses lose $50 billion to ID theft in some 15 million cases each year. This was just the second-ever such case involving file-sharing software and the total amount of losses were less than $26 thousand.
Nevertheless, the industry's view is that no amount of victimization due to inadvertent file sharing is acceptable. Leading file-sharing software distributors have committed to eradicate this potential problem where it makes the most sense to do so - at its source, before personal, sensitive, or confidential data can be disclosed - in a well-organized program being led by the ISPG.
We have to take issue with HR 1319 for several reasons.
The bill represents a very troubling step down the slippery slope towards undesirable Internet regulation. It fails to meet a threshold requirement for drafting such legislation: to only impact specific activities or behaviors associated with unique attributes of certain implementations of a particular technology. If anything, the measure underscores the difficulties of meeting this challenge.
Instead, this bill, if passed by the Senate and enacted as written, will burden any number of data transfer technologies, including entire categories of social networking services, interactive advertising, and user-generated content (UGC) offerings, for example, with ineffective requirements that will ultimately be unenforceable, and which users will find, at best, annoying.
HR 1319 fails to precisely describe behaviors and define terms so as to zero-in on certain targeted behaviors associated with file sharing - namely, uploading sensitive data by mistake - without causing unintended consequences in the form of collateral damage to other activities, attributes, implementations, and technologies.
The way in which lobbyists sponsoring this legislative debacle were able to dismiss real industry progress in addressing the problem of inadvertent file sharing should serve as a wake-up call to the entire technology sector. The process undertaken here sadly demonstrates how powerful special interests can still duplicitously and wastefully manipulate the lawmaking process.
Their campaign put forth a false impression: that the increasingly unwarranted HR 1319 was meant to protect individual consumers from inadvertently sharing their own personal and confidential information. In reality, the reason for the bill was to protect content rights-holders from having their copyrighted works shared without authorization.
As we expressed throughout this dubious exercise, however, this latter concern is certainly a legitimate one, and we seriously welcome every opportunity to work with content providers on practical solutions. But let's be straightforward about it.
Finally, we remain extremely concerned that even if this bill is enacted, it will not influence the growing body of empirical evidence that was used to justify its introduction in the first place.
What will happen after the notice-and-consent regimes stipulated in the bill are implemented, but the proliferation of individual and institutional leaked confidential data that is searchable on file-sharing networks and the Internet generally continues to increase rather than decrease?
Once any such file has been disseminated to other networked devices, it is virtually impossible to recall all the copies of that file or prevent them from being discovered in an ever-expanding list of related search results on multiple platforms all over the world.
And even if a fortune is expended attempting to enforce this Act, as the Congressional Budget Office (CBO) suggests that it will, problems associated with international jurisdiction will minimize its ultimate efficacy.
The challenge of deleting the massive amount of personal and confidential data that is mistakenly in distribution on the Internet is an exponentially more difficult problem to confront. Nothing in HR 1319 addresses this aspect of inadvertent file sharing.
And because the bill as contemplated will not mitigate the massive availability of sensitive information, we expect that shortly Congress will again rebuke file-sharing software for this same problem, even if US-based and responsible overseas software companies continue voluntarily to shore-up original entry points for such data.
What we need is more fact-based discussion and honest, informed, collaboration aimed at real solutions. Share wisely, and take care.
House Passes "Informed P2P User Act"
Excerpted from Zeropaid Report by Jared Moya
The House of Representatives has formally passed "The Informed P2P User Act" (HR 1319) to protect PC users from the inadvertent sharing of sensitive information when using file-sharing software.
Taken up by the Energy & Commerce Committee in September, the bill makes it illegal to cause the owner of a PC to make his or her files available via a file-sharing program without explicit permission.
Prior to installation, the program must: "provide clear and conspicuous notice that such program allows files on the protected computer to be made available for searching and copying by another computer; and obtain the informed consent to the installation of such program from an owner or authorized user of the protected computer; and provide clear and conspicuous notice of which files are to be made available to another computer; and obtain the informed consent from an owner or authorized user of the protected computer for such files to be made available."
It's pretty straightforward, but occurs rather late in the file-sharing game. Programs like LimeWire for example, have already introduced updated versions that do not share files by default.
The real problem in all of this is inexperienced PC users for whom no legislation will be of any real value. Informing a user he or she will be sharing a file doesn't necessarily mean they'll heed the warning, and considering teens are some of the biggest users of file-sharing software, it's not likely they'll be worried about sharing too much of the data on the family PC.
But Representative Mary Bono Mack (R-CA) says she hopes her bill will also "address the inherent privacy risks associated with file-sharing programs that have caused major security breaches involving national security details."
I don't think a simple warning on a file-sharing program will solve our national security breaches. Do you?
Only legislation like that introduced by Representative Edolphus Towns (D-NY), the Secure Federal File-Sharing Act, will properly address that problem by making it unlawful for government employees and contractors to download, install, or use recreational file-sharing software without official approval.
US Air Force Orders 2,200 PlayStation 3s
Excerpted from Escapist Magazine Report by Greg Tito
In a requisition order dated on November 16th, the United States Air Force Research Laboratory (AFRL) asked to buy 2,200 PlayStation 3s (PS3s). The consoles will not be used to play games, but instead will be part of a research project to help modernize the military's supercomputer systems through distributed computing.
The AFRL in Rome, NY is interested in the cell chip technology used by Sony to build PS3s. After pricing out competing chips from IBM or Intel, the research team discovered something that some gamers already know: game consoles cost way less than the materials used to make them. It's called a loss-leader, fellas.
Arguably, Sony got the ball rolling using distributed computing by releasing folding@home to run computing cycles on PS3s when consumers were not using them. It is not clear whether they anticipated that consumers and even governments would realize that they were selling the cheapest computing power on the planet, and try to exploit that.
The Air Force has been experimenting with linked PS3s for some time. Right now, the ARFL has 336 PS3s linked together in a Linux-cluster, but they are looking to expand the experiment. The requisition puts it this way:
"With respect to cell processors, a single 1U server configured with two 3.2-GHz cell processors can cost up to $8k, while two Sony PS3s cost approximately $600. Though a single 3.2-GHz cell processor can deliver over 200 GFLOPS, whereas the Sony PS3 configuration delivers approximately 150 GFLOPS, the approximately tenfold cost difference per GFLOP makes the Sony PS3 the only viable technology for HPC applications."
In layman's terms, they can get three-quarters the processing power from a PS3 than they can with two other chips, for less than 8% of the cost.
That makes it a sound business decision for the research team, but Sony would certainly get the shaft. The Air Force is not going to buy the games that would make 2,200 purchases even close to being profitable for the console manufacturer. If I were Sony, I would try to put the kibosh on this right away. Of course, I can hear the current shill on their commercials really running with the PR: "Sony PlayStations can indeed do everything, even build supercomputers for the United States Air Force!"
The technology is interesting. Putting that many consoles into an array in order to maximize computing power is pretty cool, and, from their perspective, they are being smart with their money. But it seems like the brains behind it need to think about the politics and the economics of the situation a little more. The only reason these consoles are cheap is to sell games and if an entity of the US government snatches them up to create a supercomputer Skynet, then the games industry could be in trouble.
BBC and P2P Next Test HD BitTorrent Streaming
Excerpted from NewTeeVee Report by Janko Roettgers
The EU-funded P2P Next project has started to stream BBC content in true 1080p high-definition (HD) via BitTorrent. The project posted an episode of the BBC's R&D TV on its technical trial website this week, with the option to stream it either in regular 480p or full HD-quality 1080p. Users have to first install a plug-in, which is currently only available for Windows.
P2P Next has been working on BitTorrent-based streaming since early 2008, and the project has enjoyed support from a number of European heavyweights. The EU has funded P2P Next with $20.8 million. The BBC has been an early content partner of the project, and Pioneer has partnered to produce a P2P set top-box prototype. Initial data from the current test is promising, but it also shows there's still work to be done.
P2P Next is using a technology that's loosely based on BitTorrent, but optimized for real-time and on-demand streaming. The objective of the current trial is to see whether the project's adaptation of BitTorrent can scale. P2P Next's researchers are also using it to experiment with ISP-friendly congestion control, meaning that they're trying to figure out how to route those P2P video bits without clogging up the tubes.
One of the big issues of P2P streaming has always been latency. A little bit of a delay is unavoidable if bits are handed down from user to user, but of course waiting for minutes isn't really an option for live video. The current P2P Next trial seems to work fairly well in this regard: I only had to wait a couple of seconds until the BBC clip showed up in my browser after I installed the plug-in on my Windows machine, and a quick glance at the test results published in real time on the P2P Next website show that the average delay is around 8.5 seconds.
A delay like that is too bothersome for on-demand content like the video used in this trial. However, BitTorrent inventor Bram Cohen, whose company BitTorrent Inc. is currently working on its own P2P streaming solution, has argued in the past that any delay greater than 5 seconds is unacceptable for live video. It's also unclear how the technology would behave under really high demand. At last check, only around 500 people had participated in the test. And the statistics page showed some issues with stalling, with more than 10% of all users reporting more than 10 stalls.
Still, the test is remarkable, if only for the fact that it shows persistent interest by broadcasters like the BBC to use P2P technology. We shouldn't expect the BBC to incorporate this type of technology into its popular iPlayer anytime soon, especially since the iPlayer really only took off after the Beeb ditched P2P downloads for its current web-based streaming model.
However, P2P Next is also experimenting with distributing 500 set-top boxes to TV viewers in Europe by the end of this year. The BBC has been trying to move the iPlayer beyond the PC for a while with implementations for the Wii and various set-top boxes. Throw some P2P into the mix to cut down the broadcaster's bandwidth bills, and suddenly BitTorrent is starting to make a lot of sense for the Beeb.
CloudShare Lands $10 Million in New Round of Funding
CloudShare has received $10 million in series B financing from Sequoia Capital, Gemini Capital, and Charles River Ventures (CRV). The company plans to use the investment to fund product development and expand its go-to-market capabilities.
CloudShare, a Menlo Park, CA based start-up, has developed what could be revolutionary for solution providers and independent software providers (ISVs) selling software or appliances: a way for organizations to instantly deploy multiple, independent copies of their existing demo or training environments in the cloud. The company says its ability to raise a significant round of funding at a higher valuation than its previous round - in a down economy - reflects the stability of the company and the value it provides.
"CloudShare has taken all the necessary steps to solidify its market position and prepare for future growth. We are impressed by the team and track record CloudShare brings to the table, and are immensely pleased to be backing a company that we believe is not only capitalizing on cloud computing, but using it in the right way to benefit business users," said George Zachary, Partner at Charles River Ventures.
CloudShare customers, which include such industry leaders as Cisco Systems, SAP, VMware and more, have already delivered over one million demo, proof-of-concept (PoC), and training hours to date, representing over six quarters of consecutive double-digit usage growth for CloudShare. This early success demonstrates the practical, revenue-oriented, immediately useful nature of the CloudShare platform.
"Since founding CloudShare in 2007 we've been focused on developing our technology, with the promise that it will revolutionize the way sales demos and PoCs are conducted. We've officially come out of stealth mode with marquee customers, a proven cloud-based technology platform, and $10 million in funding to help build-out our vision. We now have all the right assets in place and we look forward to reaping the benefits in 2010 and beyond," said Zvi Guterman, CEO of CloudShare.
mTouche Forms Joint Venture to Offer P2P Mobile Content in India
Leading mobile content technology provider mTouche Technology has set up a joint venture company mBit Infotech in India to launch a P2P mobile content platform for major Indian telecommunication service providers.
This new entity, which has been established with technology firm VASSoft, a wholly owned unit of Himenviro Environmental Technologies, will be a strategic vehicle to launch the mBit network with the Indian service providers.
The new entity plans to reach out to 500 million mobile users in India at a fee of $0.06 per day for the platform that allows them to share content files such as photos, video, and music using mobile phones. The charge is in line with the market's average mobile value-added services rate in India.
"The joint venture partner will invest up to $1 million in the first phase to roll out the mBit P2P mobile content offering in India. mTouche Technology India has been evaluating the Indian market since the year 2006. The Indian market has experienced an increase in the mobile subscriber base - from 150 million to 450 million. This shows the kind of opportunity the Indian market provides for the VAS players. We are here with the best of the technologies and services to address the market requirement," commented Eugene Goh, CEO of mTouche.
"VASSoft and mTouche joining hands and forming mBit Infotech combines the financial strength and VAS expertise and a fresh outlook to serve the Indian market with a unique P2P file-sharing application. The JV is strategically placed to benefit the Indian and Asian markets as a whole", commented Raghavendra Aggarwala, CEO, mBit Infotech.
mTouche's mBit network mobile solution is the world's first P2P technology for mobile phones. Previously, P2P technology was limited to wireline networks. The technology, which is applicable to the 3rd and 4th Generation (3G & 4G) mobile phones, was introduced internationally about two years ago at a DCIA conference.
Kualo Launches theCloud On-Demand Cloud Computing Solution
Kualo, a leader in managed business hosting, announces the launch of its new hosting service, theCloud, available immediately though Kualo's newly re-branded website. theCloud provides flexible virtual servers on-demand enabling customers to build a hosted cloud server of any size using intuitive sliding scale controls and have it provisioned after submitting payment details.
Unlike other cloud solutions available on the market today, Kualo is combining the flexibility of cloud computing with its proven expertise in managed hosting solutions. Customers can choose from several levels of managed hosting solutions for their new cloud environment and have confidence and peace of mind that their infrastructure is well configured and maintained.
In order to provide leading edge capabilities and reliability, Kualo partnered with 3Tera, the leading innovator of cloud computing technology. 3Tera's AppLogic cloud computing platform allows businesses to construct complete user-defined infrastructure configurations with the exact amount of resources needed.
"We are extremely excited to introduce theCloud," said Jo Stonehouse, Managing Director, Kualo. "We believe that IT resources should be easy to use, scale, and manage, so that businesses can focus on their main expertise. Having the support of 3Tera in rolling out new services and capabilities makes us confident in the benefits of cloud computing for our hosting business. We are already seeing growing demand for theCloud and soon will make the service available in our London, UK facility."
"Our partnership with Kualo exemplifies why we work closely with leading hosting providers," commented Bert Armijo, SVP Marketing and Product Management, 3Tera. "Combining their managed hosting expertise and data center presence on each side of the Atlantic with 3Tera's cloud computing solution will result in an enterprise-quality service that ensures flexibility and disaster recovery capability for any application, all at a much lower entry cost."
Kualo's theCloud is available immediately with pricing starting at just $35 per month for 0.4GHz of CPU, 256MB RAM, and 20 GB disk space, scaling all the way up to a little over $1,200 per month for 7.6GHz of CPU, 15 GB RAM, and 800GB disk space. Initially, the service is available at Kualo's data center facility in Tampa, FL, with plans to extend the service to their London facility before the end of the year.
Octoshape Earns Industry Recognition for P2P Streaming Solution
Octoshape is joining the ranks of Google, Skype, and eBay on the Red Herring Top 100 list of emerging companies as well as the Streaming Media Dream Team 2009.
For years Octoshape has been shaping the streaming media business. The driving force of Octoshape has been a constant striving to provide streaming solutions that match the ease and quality of TV combined with the benefits of Internet services.
As Octoshape continues to expand, its list of achievements is growing. In the past live streaming coverage of the Eurovision Song Contest (largest non-sporting event in Europe) was hard to come by as traditional streaming solutions struggled with the scale of the event. But for three years Octoshape has been serving a premium P2P-based streaming experience to worldwide audiences; offering higher quality to an increasingly larger audience each year.
In the US, streaming from major national events implied frequent outages and buffering. And due to the massive Internet traffic during the inauguration of Barack Obama, even regular web surfing could be a slow and unstable experience. Despite these conditions, the Octoshape powered P2P stream ran without issue for the duration of the event and in the process allowed a major US news channel to set the online streaming record for a simultaneously connected audience.
And in Asia, Octoshape has powered several large-scale P2P streaming events such as Olympics in HD and many other high profile sporting events.
The successful deployment of Octoshape around the globe has now earned recognition from the technology and streaming industry. Octoshape is proud to have received the Red Herring 100 Europe award and earned a spot on the Streaming Media Dream Team 2009.
"It's our annual list of the most important people in the streaming media industry - the people who've not only found success in their own efforts but also gone out of their way to help advance the industry as a whole, through evangelizing outside our community or educating and helping others within it," said Eric Schumacher-Rasmussen, Editor of Streaming Media.
Dyyno Launches Free 1080p Live Streaming Solution
Excerpted from ReadWriteWeb Report by Frederic Lardinois
Dyyno, which allows its users to stream and record live video from any application on their desktops, this week launched a major upgrade of its service. The company's service will now allow users to stream live and recorded video streams in full 1080p high-definition (HD) resolution. Dyyno has also dropped the price for personal accounts - which can stream HD video - to zero. These personal accounts support up to 100,000 concurrent viewers. Previously, these accounts started at $10 per month.
For the time being, Dyyno can only stream videos from Windows PCs. The company does offer a browser plug-in for watching the videos on Mac and Windows. The company's CEO Raj Jaswa told us that a Mac client is on the company's roadmap.
In our tests, the service worked just as advertised and the image quality of the 1080p streams was very high. It takes a decent broadband connection to work well, however - the HD video streams take up about 3Mbps. Dyyno supports up to 30 frames per second and encodes its videos in H.264. The company does not automatically scale the video streams down for users with slower connections, though for on-demand video, content owners can choose different bitrates for their videos.
Running Dyyno's desktop client is very easy. After installing the application, you just have to drag the Dyyno logo from the client to any window on your computer and it will automatically start to stream this video on your personal Dyyno page. In addition to live streaming, users can also create a "WebTV" channel that plays videos at a set time.
The fact that it takes a browser plug-in to run the service could be a roadblock for some potential users, however. On the other hand, no other service that we are aware of offers free 1080p live streaming.
As Dyyno's platform is based on a P2P architecture, it only makes sense for the company to offer the live streams for free. After all, the more users watch the stream, the easier it will be for Dyyno to deliver the video.
The company does charge users who want to store more than 1GB of video for on-demand streaming on Dyyno's servers $10 per month. Dyyno does not charge for bandwidth. The P2P architecture doesn't lend itself for on-demand streaming, so Dyyno chose to charge for this aspect of its service.
The company also offers business channels for $100 month, which include a total of 10 video channels and up to 100GB of storage. The company's high-end account, the Dyyno Broadcast station, costs $1,000 per month, and allows users to store an archive of up to 1,000GB of video and broadcast more than 100 concurrent video streams.
Both the business and the broadcast accounts are stripped of all Dyyno's branding. Dyyno plans to offer an ad revenue share model to companies that subscribe to these higher-end accounts and who want to make use of Dyyno's on-demand streaming solutions.
Download or Stream Your Torrents with Put.io
Excerpted from TorrentFreak Report
Put.io is a brand new service that allows users to download torrent files at blazing speeds to a remote server. Once finished, users can download the files to their home computers or stream video files directly to their Internet browser or media player.
The Turkey-based start-up Put.io markets itself as a premier torrent download service, but it's more than that. In addition to torrents the service supports Rapidshare links, while users can also use Put.io as an online backup platform by uploading files from their computer.
Downloading torrents files through Put.io is achieved with just a few clicks. All it takes is pasting in a torrent URL and Put.io takes care of the download through its connection. Once the download is finished, users can transfer it to their computer, or stream it directly from the remote server if it's a video file.
The user interface and design of the site is intuitive and easy to use, but perhaps more importantly it was extremely fast during our tests and easily maxed out our connection. However, when more people join and the load on the servers goes up, there could be a degradation in performance.
So what's the catch you might ask? For beta users the service is totally free, no strings attached. However, once the service goes out of beta it will require users to pay a monthly fee.
Looking Back on the Music Industry's First Digital Decade
Excerpted from California Chronicle Report by Eamonn Forde
From the launch of P2P file-sharing service Napster to the arrival of P2P live-streaming service Spotify, the past ten years have seen the music industry forced into an unparalleled process of change and innovation. As we head into 2010, the challenges ahead provide scope for yet more breathtaking invention.
When Shawn Fanning unleashed Napster in 1999 its arrival rocked the music industry to its very foundations. And a decade on, the impact of the P2P service is still being felt.
The past decade of digital music has been the story of "free"; from unauthorized and unlimited free (Napster 1.0) to licensed and unlimited free or "as free" (as illustrated by the likes of QTRAX, Last.fm, We7, Spotify, and Comes With Music).
Piloting between these two extremes has been the music industry's greatest challenge but it has also triggered its greatest period of innovation.
"Although as an industry we didn't immediately embrace the possibilities created by new technology, we've developed an increasingly sophisticated understanding of the opportunity," said Warner Music International SVP of Commercial Strategy Eric Daugan.
"In the last few years especially, we've been at the forefront of new ways for people to interact with entertainment content. At the core of that change is our ability to understand and deliver what music fans want. The relationship between artist and fan remains at the heart of the music business."
This is borne out by the fact that this year has seen record levels of download sales in the UK - 108 million digital singles and 11 million digital albums in the first nine months of this year according to BPI numbers.
While the singles chart is almost exclusively digital (98% of Top 40 sales are downloads), the industry is still trying to figure out how to sell in volume rather than have albums cherry-picked by consumers for whom digital is a source of liberation. Please click here for the rest of this report.
How Hot Is P2P Music Streaming Service Spotify?
Excerpted from GigaOM Report by Om Malik
You know how Apple makes its presence felt at CES by not being there? Well, you can say the same for Spotify, a London and Stockholm based P2P music streaming service that was co-founded by Martin Lorentzon and Stardoll founder, Daniel Ek. At Le Web 2009, Spotify made its presence felt with its omission.
Much like the all-consuming talk of Twitter at pretty much any Silicon Valley event, dozens of Europeans couldn't stop gushing about the service that only recently launched and only in six European countries. More than a dozen people, randomly (and without prompting) told me how they can't live without Spotify.
In less than six months of being valuable, the company has become a force of nature, and in the words of an executive, taken on a life of its own. Now, some of it can be attributed to grassroots support and the immense amount of press drummed up for the service by Shakil Khan, who labels himself as Spotify's consigliere. The early buzz is one of the reasons why there have been comparisons with Joost, the P2P video venture started by the Co-Founders of Skype and spearheaded by former Cisco executive Mike Volpi. Joost grew its base at a spectacular speed but then like a meteor, burnt out. It couldn't get the content or its to-market strategy right.
Spotify has problems, but of a different kind. I like to call them YouTube-caliber problems. The company is getting too popular and as long as it remains so, will almost always face immense infrastructure costs. Sure it's raised over $50 million at a valuation of $250 million, but that may not be enough.
That said, the grassroots support for Spotify seems to be genuine, thanks to a lot of content. The service's growth has caught everyone by surprise, including the company. I'm sure even the record labels - including the four majors - that have taken equity in the much-buzzed start-up (alongside Joost backer Li Ka-shing and other investors) have been pleasantly surprised by the rise of Spotify, as it's finally given them a chance to have a counterweight to Apple, which has thus far been a dominant player in the world of music.
My colleague Kevin Tofel will be pleased to know that he is part of a growing posse (at least in Europe) who believe that listening to music via a cloud-based music service is the way we are going to consume music in the future.
The early popularity of Spotify shows that the service might have come to market at just the right time. As Paul Bonanos explained in his post earlier today, cloud-based music services are being egged on by the availability of high-speed wireless networks (of both the local and wide-area variety) and mobile phones with impressive music playback capabilities. That's why Spotify, according to its executives, is not just about the desktop but also about making music available on handsets. Unlike Apple, it's free to offer this service to pretty much any handset maker. Please click here for the full report.
Is Spotify Doomed? An Alternate Reality Analysis
Excerpted from Arctic Startup Report by Nick Mueller
As the region's reigning consumer web champion, there can never be enough stories about P2P streaming music sensation Spotify. And since this week they've released a version for Android and some new user and track figures, it's a good time as any to wonder what the future might hold for them.
Especially in light of Apple's recent acquisition of US based La La Media.
Caught on tape at Le Web, Spotify "Consigliere" Shakil Khan announced that they now have 7 million users in 6 countries choosing from 6.5 million tracks and listening for an average of 80-90 minutes per user.
When asked the billion dollar question about when the service will launch in the US, Khan reiterated the 1Q10 time-frame that has been given before. Interestingly, he also said that one of the main delays has been setting up a corporate infrastructure in the US including "business licenses and visas," as well as operations and ad sales teams in Los Angeles, San Francisco, and New York.
Spotify has used this type of careful building since the beginning, and it is a credit to the way that they think about user experience, considering problems that would result from not being fully prepared as a degradation to the end service. However, with attitudes towards the non-ownership model changing rapidly, there will be an element of first-mover advantage to whoever can launch an insanely great streaming service in the US, and even more so if that first-mover happens to be Apple. Will Spotify be dead-on-arrival in the US if Apple launches an iTunes streaming service before they're ready?
The answer, unfortunately, seems to be yes. If Apple uses La La's technology and executives to launch what would surely be an appealing service to go head-to-head with Spotify in the US, the advantage seems to tilt towards Apple. Here's why:
Apple's not venture backed. Even a reported war chest of as much as $250 million, might not help Spotify outspend Apple, with quarterly revenues close to $10 billion, on talent, technology, and content. At some point, they'd have to throw in the towel.
Spotify may be the best hope for the record labels, but at the moment it's iTunes that's paying the bills, and getting the leverage and perks of buyer power.
Apple is, you know, kind of ruthless. They might be willing to keep the Spotify application in the app store, but it would just take a couple of tricks from Microsoft's "pre-installed IE" hat to get users hooked on streaming iTunes before they can even learn what a Spotify is.
This is all speculation, and of course it's fully possible that the US market is big enough for more than one successful player in this market. Nonetheless, we wish Spotify the best in all future battles!
When the Cloud Goes Poof
Excerpted from Digital Music News Report by Paul Resnikoff
Just think. Your entire collection in the sky, accessible from wherever, whenever, without the hassle of hard drives, synchronizations, or downloads.
Now, just think about what happens when it all goes away, without warning. Sure, inside the industry, the problems plaguing iMeem were well known. But for the fan? Abruptly, iMeem subscribers are being redirected to MySpace Music, and their cloud has suddenly gone dry. "This news is incredibly distressing," one fan lamented in a CNet comment thread. "I have 80 personal playlists (or had) on iMeem."
Others were also wondering why their collections went "poof" overnight. "A warning would have been nice, that's all at the least, from loyal long-time users like you and me," another said.
So who's to blame? This is a problem that started long before MySpace arrived, and iMeem is a classic 'long story'. At the eleventh hour, MySpace was forced to trigger the redirect before the lights went out at iMeem, and MySpace is now working through the details of resurrecting user playlists. But given the general backdrop of chaos, some of this information may not make it across.
But even if it does, what happens if the user simply hates MySpace Music? Even if the contents are transferred over perfectly and with a smile, many fans will simply jump ship. Actually, a large percentage may have already walked away.
Suddenly, the safer bet seems to be downloading - in massive quantities, illegally. Storage gets cheaper and cheaper every day, and BitTorrent can deliver albums (and catalogs) in minutes. Sure, locally-stored collections can also get "lost in the fire," stolen, corrupted, or otherwise destroyed, but at least the user is not dependent on a third-party company.
Because companies go broke (iMeem) or get acquired (Lala) all the time, and in the case of ad-supported, on-demand streams, the space has never been shiftier. And yes, the same applies to Spotify, and even paid platforms like Rhapsody and Napster.
Too little vision? Perhaps, but in 2009, the cloud simply requires an irrational level of trust in a third-party provider. The simpler technological solution - a locally-stored collection - is vastly safer and more reliable in the here-and-now, and potentially far into the future as well.
Swedish Internet Traffic at All-Time High
Excerpted from Afterdawn Report
Despite a recently publicized 18% jump in music sales following the launch of IPRED in Sweden, The Local is reporting that unauthorized file sharing is back in full force, reaching new record levels.
Stats from Swedish organization Netnod showed that Internet traffic in the entire country dropped 40% when IPRED went into effect in April, mainly due to a cutback in BitTorrent traffic.
The Local is reporting that Internet traffic is at an all-time high now in the nation, although the numbers can hardly be considered set in stone at the moment.
"Spotify and the various television channels 'play' sites haven't yet released their statistics. There is guaranteed to be a certain increase in file sharing, but it isn't possible to tell exactly how much," added researcher Kristoffer Schollin.
Anti-virus protection company McAfee also says that file-sharing sites have grown by over 300% since IPRED.
"Then you have the unauthorized video streaming sites, which aren't file sharing in the traditional sense, but which play the same role for users. Watching a movie via a streaming video directly in your web browser is becoming more and more popular," Schollin adds.
Xunlei Is Unscathed in Crackdown
Excerpted from Marbridge Consulting Report
Luo Weimin, COO of Chinese P2P online video and download accelerator provider Xunlei, has said that the shutdown of domestic BitTorrent sites in China will not affect operators such as Xunlei, which has the required business licenses.
He also said that demand for online access to television shows is not slackening, and that a large-scale shutdown of BitTorrent sites will help to boost the popularity of online video sites, including Xunlei's.
Luo said that Xunlei's download volume is currently stable, and has shown neither an increase nor decrease.
Beginning in December, the State Administration of Radio, Film and Television (SARFT) began to order the shutdown of several well-known BitTorrent sites, including BTChina, Ximo, Longman, and Kaishen.
File-Sharing Judge: Copyright Act Creates Deep Potential for Injustice
Excerpted from Daily Online Examiner Report by Wendy Davis
The federal judge who presided over the recent file-sharing lawsuit by the record labels against grad student Joel Tenenbaum has joined the roster of critics who are asking Congress to reform copyright law.
"As this court has previously noted, it is very, very concerned that there is a deep potential for injustice in the Copyright Act as it is currently written. It urges - no implores - Congress to amend the statute to reflect the realities of file sharing," US District Court Judge Nancy Gertner wrote in a decision issued Monday.
"There is something wrong with a law that routinely threatens teenagers and students with astronomical penalties for an activity whose implications they may not have fully understood."
This summer, a jury in Boston decided that Tenenbaum had used file-sharing software to unlawfully share 30 tracks and ordered him to pay a total of $675,000, or $22,500 per track.
Federal copyright law provides for damages ranging from $750 to $150,000 per infringement.
Tenebaum's legal team has said it intends to file motions challenging the damages award. Gertner ordered Tenenbaum's attorneys to file those papers by January 4th.
Tenenbaum was the second file sharer sued by the record labels to take his chance with a jury, and the second to lose big. In June, a jury in Duluth, MN ordered Jammie Thomas-Rasset to pay $1.92 million for sharing 24 tracks.
Thomas-Rasset has already asked the judge who presided over her case to slash the verdict, arguing that it's disproportionate to whatever harm she caused the record industry.
An earlier trial in 2007 resulted in a jury verdict of $220,000, or $9,000 per track. But US District Court Judge Michael Davis in Minnesota set that verdict aside and ordered a new trial because of a mistaken jury instruction.
At the time, Davis expressed concern over the size of the award. "While the court does not discount plaintiffs' claim that, cumulatively, illegal downloading has far-reaching effects on their businesses, the damages awarded in this case are wholly disproportionate to the damages suffered by plaintiffs," he wrote.
Coming Events of Interest
P2P MEDIA SUMMIT at CES - January 6th in Las Vegas, NV. The DCIA's seminal industry event, featuring keynotes from top P2P, social networking, 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.
World's Fair Use Day - January 12th in Washington, DC. WFUD is fast approaching and Public Knowledge is happy to announce a number of exciting additions to the list of confirmed speakers. Head over to the World's Fair Use Day website to view the full schedule. And be sure to join us for a day-long celebration of fair use, creativity and remix culture!
MIDEM & MidemNet - January 23rd-27th in Cannes, France. MIDEM is where music professionals from across the industry meet face-to-face to do business, analyze trends and build partnerships. MIDEM brings together music leaders looking for concrete solutions and insights. MidemNet's renowned digital business conference program is now included free with your MIDEM registration.
Vator Splash Event - February 4th in San Francisco, CA. Vator, a leading platform for innovators and entrepreneurs to broadcast themselves, is holding its inaugural Vator Splash Competition to find 10 promising early-stage start-ups to present at this special event. Enter the competition today using the 25% discount code: VatorDCIA.
Cloud Computing Forum - February 10th online. Open source software developer Red Hat will host an online forum on open source cloud computing. The forum will include technical presentations from across the cloud computing industry, as well as discussions on current challenges and solutions offered by open source technologies.
P2P MARKET CONFERENCE - March 9th in New York, NY. Strategies to fulfill the multi-billion dollar revenue potential of the P2P and cloud computing channel for the distribution of entertainment content. Case studies of sponsorships, cross-promotion, interactive advertising, and exciting new hybrid business models.
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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