Distributed Computing Industry
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In This Issue

P2P Safety

P2PTV Guide

P2P Networking

TPB Court Case

Industry News

Data Bank

Techno Features

Anti-Piracy

February 23, 2009
Volume XXV, Issue 6


Internet Study Reaffirms P2P Dominance in 2009

Ipoque, a leading provider of network traffic management solutions, this week published its Internet Study 2008/2009, covering usage of the most popular protocols including peer-to-peer (P2P), voice over Internet protocol (VoIP), instant messaging (IM), media streaming, and many more.

For the third consecutive year, ipoque executives Klaus Mochalski and Hendrik Schulze analyzed 1.3 petabytes of global Internet traffic, representing a greater number of Internet service providers (ISPs) than previously.

Their key finding is that P2P generates the most traffic in all eight regions of the world.

Their content-type analysis also reveals the kinds of files being shared in the two most popular P2P networks, BitTorrent and eDonkey. For the first time, the study also includes an analysis of average packet sizes for all encountered protocols.

Other key findings of the study include: BitTorrent is number one among all protocols (HTTP is second); file hosting has considerably grown in popularity; and streaming is taking over P2P users for video content.

P2P MEDIA SUMMIT Archival Video Now Online

Many thanks to Abacast, and in particular, Jason Vosburgh, for their excellent work in producing the P2P MEDIA SUMMIT at CES archival video, which is now available for viewing here.

The policy track, featuring Jim Burger, Lawrence Hadley, Louis Lehrman, Steve Masur, and Joshua Wattles, can be viewed here. The opening keynote address by Robert Levitan can be viewed here; and morning keynotes from Mark Stuart here; and George Searle here.

The technology track, featuring Rick Buonincontri, Matt Drown, Nathan Good, Aaron Markham, Jeffrey Payne, and Jonathan Zuck, can be viewed here. Keynotes by Travis Kalanick can be viewed here; and Kumar Subramanian here.

The marketing track, featuring Harvey Benedict, Chris Gillis, Daniel Leon, Alex Limberis, Thomas Reemer, and Paul Ritter, can be viewed here. Conference luncheon presentations by Milt Ellis and Joe Porus can be viewed here; and by Doug Pasko and Laird Popkin here.

The content distribution panel, featuring Daniel Harris, Steve Oedekerk, Keyvan Peymani, Patrick Ross, Rafael Solis, and Laura Tunberg, can be viewed here.The keynote address by Joey P can be viewed here.

The solutions development panel, featuring Boh Dupree, Michael King, JD Lasica, Jonathan Lee, Neerav Shah, and David Ulmer, can be viewed here. The keynote by Eitan Efron can be viewed here. The closing special session presentations by Ron Berry can be viewed here; David Rice here; and See-Mong Tan here.

Also, please note that for the first time ever, Abacast will be presenting a LIVE webcast of the upcoming P2P MARKET CONFERENCE on March 17th from New York, NY. To register now for this exciting and history-making event, please click here.

Sign-Up for P2P MARKET CONFERENCE, Save $500

The DCIA's second annual P2P MARKET CONFERENCE is scheduled for Tuesday March 17th at the Cornell Club of New York, and is being held in conjunction with Media Summit New York (MSNY).

MSNY keynotes include Jeff Zucker, President & CEO, NBC Universal; Steve Ballmer, CEO Microsoft; and Philippe Dauman, President & CEO, Viacom.

P2P MARKET CONFERENCE keynotes include Jim Kott, Co-President, Abacast; Rick Kurnit, Partner, Frankfurt Kurnit Klein & Selz; Mitchell Edwards, CFO & General Counsel, BitTorrent; John Desmond, VP, MediaSentry Services, SafeNet; George Searle, CEO, LimeWire; Michael Einhorn, Consultant, Media/Technology/Copyright; Robert Levitan, CEO, Pando Networks; Alex Mashinsky, CEO, DigiMeld; Scott Brown, USA CEO, Octoshape; Charles Perkins, Founder, Virtual Rendezvous; Saul Berman, Global & Americas Strategy & Change Practice Leader, IBM; and John Waclawsky, Software Architect, Motorola.

The P2P MARKET CONFERENCE includes a continental breakfast, conference luncheon, and VIP networking cocktail reception. Pre-registration rates, which save attendees up to $500, end March 10th. To register now, please click here.

This year's P2P MARKET CONFERENCE panelists include representatives of AHT International, Amalgam Digital, Ascent Media, Association for Competitive Technology (ACT), BayTSP, HIRO Media, IBM, Jambo Media, Lazard Capital Markets, LifeLock, Marvel Entertainment, MasurLaw, Nettwerk Music Group, The Orchard, P2P Cleaner, P4P Working Group (P4PWG), PacketExchange, Syabas Technology, Tomorrow Will be Televised, Vator.tv, Verimatrix, Viddler.com, and more.

Report from CEO Marty Lafferty

Photo of CEO Marty LaffertyWe hope to see you this week at Digital Music Forum East, hosted by Digital Media Wire and the Consumer Electronics Association at two sessions presented by the DCIA.

On Wednesday at 3:00 PM, the Isle of Man's e-Commerce Advisor, Ron Berry, will lead a delegate roundtable discussion of Digital Music Testing on the Isle of Man and our new P3P Working Group (P3PWG). On Thursday at 12:30 PM, we'll conduct a keynote interview with LimeWire's CEO, George Searle.

Separately, the DCIA is very grateful for the investment of time and effort by industry-leading P2P companies from around the world in voluntarily reporting their compliance with the Inadvertent Sharing Protection Working Group (ISPG), the DCIA-sponsored industry-wide program introduced in July 2008.

Submissions have been compiled this week from top brands representing implementations of P2P technologies ranging from downloading to live-streaming, from open consumer file-sharing environments to secure corporate intranet deployments, and from user-generated to professionally produced content.

Along with actively participating in this program, summarized here, we encourage P2P software distributors to direct users to the Onguard Online website pages dedicated to P2P File-Sharing Safety. For more information about the ISPG, please call 410-476-7965 or e-mail ISPG@dcia.info.

The ISPG summary document outlines seven steps that are required to be in compliance: 1) default settings, 2) file-sharing controls, 3) shared-folder configurations, 4) user-error protections, 5) sensitive-file-type restrictions, 6) file-sharing status communications, and 7) developer principles. The developer principles address feature-disablement, uninstallation, new-version upgrades, and file-sharing settings.

An eighth optional step for added consumer protection addresses inactive states of the P2P file-sharing application (fully disconnected from the P2P network and running in the background).

To put the ISPG in context, identity (ID) theft costs US businesses and consumers in excess of fifty billion dollars annually with an estimated 15 million US ID theft cases per year according to Javelin Strategy & Research.

Of this amount, to date, the Department of Justice (DOJ) has prosecuted only one case associated with P2P file sharing, where the total losses were $73,000. And among thousands of cases cited in the President's Identity Theft Task Force fact sheet, none involved P2P. But that does not mean this potential threat should be ignored or under-estimated by our emerging industry.

In about one-fifth of stolen ID cases, the Internet plays a part in perpetrating the crime. Thus far, in such instances, the means have tended to be more directly related to the intentions of the criminal than would have been the case in user-error of P2P software programs.

Phishing scams involving a combination of e-mail and fraudulent websites - whose average time in operation is less than three days - have posed by far the greatest danger. Given that reality, the ISPG represents an important preventive measure.

As noted when the ISPG was introduced, we are grateful to industry participants and regulatory agency representatives, who worked hard on a worthwhile project, and also to industry observers, whose critical comments are useful in pointing out issues that need additional attention to facilitate commercial advancement.

We decry, however, the destructive acts of irresponsible parties polluting P2P networks with bogus personal data files, sensationalizing false claims regarding these activities, and misrepresenting purported remedies.

The DCIA has separate ongoing initiatives focused on such issues as optimizing the efficiency of P2P protocols for broadband network operators (P4P Working Group); monetizing file-sharing traffic and deterring copyright infringement (P3P Working Group, P2P Revenue Engine, and P2P Music Models); and combating the redistribution of criminally obscene content (P2P Patrol).

Of these, the most challenging area continues to involve the distribution of copyrighted works, which the DCIA has identified as a 2009 priority.

This is due to a host of legacy reasons, inherent complexities with associated technological requirements to simultaneously monetize and protect content, and complications that continue to make it problematic for key contributors to directly participate.

Adding to the degree of difficulty, standards-and-practices efforts such as these must remain voluntary in order to comply with anti-trust laws in the US and other jurisdictions. Participation in working groups must be open publicly to qualified participants. Adherence to their work products must also be the unilateral decision of each individual company or organization.

The P2P industry has changed enormously since the DCIA's inception in 2003, with a much greater emphasis now on more sophisticated services than the kind of rudimentary file-sharing application Napster introduced.

Today we have a panoply of robust commercial P2P offerings, hybrid P2P content delivery networks (CDNs), peer-to-peer television (P2PTV) applications, live P2P streaming solutions, mobile P2P technologies, cloud computing, etc.

In the post MGM v. Grokster era, P2P software developers and distributors are successfully advancing services that appeal to consumers and serve the interests of all participants in the delivery chain. Share wisely, and take care.

Privacy a Major Concern Among Web Surfers

Excerpted from Online Media Daily Report by Gavin O'Malley

Following on the heels of Facebook's decision to rescind a highly controversial move to store all content posted on the social network, new data has emerged to support consumers' increasing alarm over online privacy.

The vast majority - 80.1% - of web surfers are indeed concerned about the privacy of their personal information such as age, gender, income, and web-surfing habits, according to a survey of some 4,000 web users administered and analyzed by Burst Media.

More worrisome, perhaps, is the finding that privacy concerns are prevalent among all age segments, including younger demographics that are coming of age online.

Still, privacy concerns do appear to increase with age, from 67.3% among respondents ages 18-to-24 to 85.7% of respondents 55 years and older.

"Online privacy is a prevailing concern for web surfers," said Chuck Moran, Vice President of Marketing for Burst Media.

The survey was administered by Burst with the purpose of better understanding how privacy is impacting web users' experiences online, as well as its impact on advertisers.

"Advertisers must take concrete actions to mitigate consumers' privacy concerns and at the same time continue to deliver their message as effectively as possible," Moran added.

"In addition, and as recently seen in the news flare up regarding Facebook's privacy controversy, publishers need to be completely transparent about their privacy policies."

Facebook recently changed its terms of use agreement, which gave the Palo Alto, CA-based company the ability to store user-posted photos and other content, even after it was deleted by users themselves. Earlier this week, however, the company reverted to a previous version of its legal user guidelines after thousands of members protested that Facebook was claiming ownership over the content.

In addition, the Burst survey found that most web users believe websites are tracking their behavior online. Three-out-of-five - 62.5% - respondents indicated it is likely that a website they visit collects information on how they navigate and interact with it.

Based strictly on the description "advertisements more relevant to interest," only one-in-five respondents - 23.2% - said they would not mind if non-personally identifiable information was collected if ads were better targeted.

DCINFO Editor's Note: This week, the US Federal Trade Commission (FTC) issued four new self-regulatory rules governing how marketers should deploy "behavioral advertising" - the practice of tracking a person's online activity in order to tailor ads to that person's interests. The rules appear in a staff report titled "Self-Regulatory Principles for Online Behavioral Advertising." Please click here to read a summary of the new rules.

A Peer-to-Peer Plaxo: Glynx P2P Identity Management

Excerpted from TechCrunch Report by Erick Schonfeld

Glynx is taking a P2P approach to identity management and in the process promises to help its users take back control of their online identities.

After downloading the Glynx software to either a PC or a Mac, you have a Plaxo-like contact manager for online contacts, e-mail addresses, and phone numbers - except there is no central directory.

Instead, Glynx has a directory it calls the "Blackpages" that exists spread-out on users' computers. You can look up specific IDs of people you know by entering their e-mail addresses or mobile numbers, but you can't browse it indiscriminately (making it more difficult for spammers to exploit the directory).

Glynx allows you to import your contacts from Outlook, Skype, and Facebook. It also offers a rich presence management tool that tells you when your Glynx contacts are online and the best way to contact them at any given moment. Finally, your Glynx ID also serves as an OpenID, making it easier to maintain a single identity across the web.

Here is how the company describes the main benefits of its software:

"Without Glynx, the websites and service providers pretty much control how your information is used. They are in a position to watch your relationships and monitor what information you are sharing, and with whom. Your e-mail and messaging is increasingly full of spam and attempts to defraud you or steal your online identity. And your mobile connectivity and productivity is at the mercy of your service provider.

With Glynx your information stays on your PC. Unless, of course, you wish to share it with someone else - in which case it gets sent directly from your PC to theirs. No middle-men. But even before you share information, Glynx lets you know who you are dealing with. And you can know what each of your contacts is up to as soon as they do."

Glynx encrypts all entries to its distributed directory, and claims that nobody controls the directory. Thus, nobody knows what is in it other than the entries they have put into it or discovered in a piecemeal fashion.

Is this what phishers and spammers have reduced us to - looking for ways to hide in our own private Internet?

Verizon Gets into Cloud Computing

Excerpted from TMC Net Report by Gary Kim

Verizon Communications appears ready to launch its planned cloud computing service in the summer of 2009. The new service will let customers order computing capacity for applications such as retail websites on-the-fly instead of having to commit to rent computer space longer term under Verizon's current hosting service model.

"Overflow" computing requirements, such as the need to ramp up e-commerce capability during the holiday shopping season traditionally has been cited as an application such on-demand access to computing utilities can address. The weaker economy should make the concept more appealing as well.

The new service, expected to be used primarily by enterprise customers, has been under construction for some time. Verizon Business executives had talked about it in the summer of 2008.

In many ways, the move validates cloud computing. As often happens, innovations in the communications business are pioneered by "outsiders" and then adopted by large communications providers once demand is proven. Recently, one saw the pattern with dial-up Internet access and broadband Internet access, for example. We also might be on the cusp of seeing something similar happen with content delivery services.

Verizon's move suggests that firm now sees utility computing as a solid business idea, even though it has been pioneered by the likes of Google, IBM, Microsoft, and Amazon.

Verizon and other global IT services companies like AT&T, BT and HP/EDS already deliver managed services, co-location, and hosting via data centers around the world. The twist with an on-demand computing infrastructure is that those enterprise users would be able to purchase core metered computing services like processing, database queries, and online storage as they need it.

Some might question the skills large incumbent telcos bring to the business, such as understanding how applications run in networked environments. A bigger issue is simply enterprise customer comfort levels with sourcing computing facilities in a different way.

Cisco Debuts Suite for Video and Rich Media

Excerpted from SmartBrief Report

Looking to capitalize on the growing demand for web-based video and rich-media applications, Cisco Systems launched a suite of technologies this week to enable advanced communications, collaboration, and entertainment experiences.

"The Internet and IP networks as we know them are changing," said Marthin De Beer, Senior Vice President of Cisco's Emerging Technologies Group.

"In the near future, 90% of consumer network traffic will be video and rich media." Please click here for the full report.

SafeNet Protects Innovative Digital Publishing Service

SafeNet, a global leader in information security, this week announced that Carry International, a leading provider of online distribution and management services for publishers across Asia, has selected SafeNet's digital rights management (DRM) solution to provide copyright protection and flexible licensing for its Taiwan government sponsored end-to-end digital publishing distribution service.

"The digital content industry represents a tremendous opportunity for our economy. In order to realize the full potential of this market, device and network interoperability is critical," said Ching Chi Hsu, Executive Vice President of the Institute for Information Industry (III), a non-governmental organization, jointly sponsored by the Taiwan government and industry.

"The adoption of open and industry standard based DRM solutions protects the profitability of the digital content market, prevents market monopolization, and most importantly, it provides consumers with ultimate ease of use and flexibility."

Carry International is the first vendor to offer the publishing industry a secure, open standards-based solution for flexible management of online e-book distribution, digital print-on-demand, and digital print DIY services. With SafeNet's DRM Fusion server and client solution, Carry International's services can guarantee that content is safe from copyright infringement and unauthorized redistribution, and it enables publishers to use a variety of flexible licensing and business models.

SafeNet is providing Carry International with a complete DRM solution that powers Carry's publishing portal with encryption and licensing management features. SafeNet's DRM Fusion Agent for PC secures the Carry PC reader application and is available also for portable reader devices and mobile phones. By adopting an open standards-based DRM solution, Carry International is able to guarantee both the stability and security of its end-to-end online distribution platform.

"Successful digital content protection and licensing models rely on flexibility. The key to flexibility in the case of digital distribution is device and network interoperability. True interoperability is achieved through the adoption of open standards based DRM solutions. Carry's use of OMA 2 DRM for eBook protection clearly demonstrates the flexibility that comes with the use of open standards," said Simon Blake-Wilson, Managing Director of Embedded Security Solutions, SafeNet.

"OMA 2 DRM is now used to protect significantly more content types than any other technology, including full track music, games, eBooks, and video download and streaming services for both mobile devices and PCs. This flexibility is crucial as content services strive to meet consumer demand for anytime, anywhere, any content consumption."

Sky Player Review: Sky Anytime on PC Has Evolved

Excerpted from TechRadar Report

Sky Player is Sky's attempt to give its subscribers added value by providing an online on-demand service for both PC and Mac owners.

Users can stream or download shows from channels they already receive as part of their TV subscription package and rent or buy selected shows and films.

The excellent Sky Player interface acts like a super-slick webpage. If you have access to live TV streaming you're presented with an EPG displaying a grid of program information. This can be browsed day by day and used to schedule remote recordings to your Sky+.

A Windows Media-style player (used here for all video playback) in the top right-hand corner displays the selected channel, which can also be viewed in a small pop-up window and enlarged to full-screen. There are three streaming qualities - low, medium and (best for full-screen) high.

On-demand offerings come from channels including Sky 1, Sky Arts, Sky Travel, Sky Sports 1-3 and Xtra, Sky Movies, Sky Box Office, Eurosport, ESPN, Sky News, National Geographic, Nickelodeon, Disney Channel, Bio, and History. Hopefully, the likes of Discovery and FX will be added soon.

Sky has cheekily 'included' BBC channels as part of the service but what's offered is just web links to BBC iPlayer. Content is organized first by genre, then channel and there's a search option and a recommendation feature.

The P2P Kontiki system is used for downloads and you can pause them or close the application while still downloading. A 40-minute TV show takes up between 380MB-400MB and a 90-minute movie between 700MB and 900MB.

Download times for recent episodes of "Lost" using a 10MB cable connection running at near full capability ranged from 15 minutes in the afternoon to 45 in the evening. "Saw IV" (900MB) took an hour.

Streaming is an impressively smooth experience with shows starting straight away. Picture quality - as is also true of downloads - suffers minor artifacting, but it's only noticeable in full-screen.

Sky Player is a well thought-out, very user-friendly service - if in need of a few more channels especially for non-Sky subscribers. Also currently missing is support for streaming around the homes and HD downloads.

But if you are a Sky subscriber with Internet access, you're essentially getting an additional Sky catch-up service for nought. The question is, how long before Sky adds Sky Player to its receivers?

Interoperation Among Cloud Infrastructures

Excerpted from SYS-CON Media Report by Ignacio Llorente

A distributed virtual infrastructure (VI) manager is responsible for the efficient management of the VI as a whole, by providing functionality for deployment, control, and monitoring of groups of interconnected virtual machines (VMs) across a pool of resources.

An added functionality of these management tools is the dynamic scaling of the VI with resources from remote providers, to seamlessly integrate remote cloud resources with in-house infrastructures.

This novel functionality allows users to add and remove capacity in order to meet peak or fluctuating service demands, providing the foundation for interoperation among cloud infrastructures. The distributed VI would run on top of a geographically distributed physical infrastructure consisting of resources from the private cloud and several external cloud providers.

Following the terminology defined by the grid community for getting grids to work together, we use the term "interoperation" for the set of techniques to get production cloud infrastructures to work together using adapters and gateways. While "interoperability" would refer to the ability of cloud infrastructures to interact directly via common open standards.

Since release 1.0, OpenNebula distribution includes the plug-ins required to supplement local resources with Amazon EC2 resources to satisfy peak or fluctuating demands.

This novel feature has been illustrated in several use cases for computing clusters and web servers. The open and flexible architecture of OpenNebula enables users to create new plug-ins to access other cloud providers.

In order to illustrate this and to provide users with a utility access to remote resources, the OpenNebula team has just released the plug-ins required to dynamically grow the infrastructure using ElasticHosts resources.

ElasticHosts is the world's first public cloud, providing scalable and flexible virtual server capacity for cloud hosting. An interesting result is that a private infrastructure could dynamically grow using resources from different cloud providers according to provisioning policies based on resource availability, performance, costs, availability, etc.

The release of these new plug-ins represents a new step towards an open-source framework for cloud infrastructure federation, which is one of the main goals of the Reservoir Project, the European research initiative in virtualized infrastructures and cloud computing.

MewSeek Pro - Advanced P2P Client for iPhone

Excerpted from iPhone Help Report

MewSeek Pro has arrived! Yes, there is a new paid version launched for the MewSeek application, called MewSeek Pro. For those who don't know about MewSeek, it is a P2P client for the iPhone, which allows you to download songs over wifi/3G.

So why Pro? The paid version of the app has added some new features, and the free version is still available via Cydia.

Pro has added the feature of downloading songs from MewSeek by default to the iPod, so you can play and access downloaded songs from the iPod directly.

Developers have also improved the search tab. The app generally looks better and is more stable than the free version. Pro also adds a feature enabling it to function fully in the background. It also includes the option to resync and play songs in the "downloads" tab.

On a trial basis, the app allows you to download three songs to the default music player (i.e., iPod.) To be able to use the full Pro version, you will have to register and pay $6.99. You will find the registration page under the home tab.

GoGrid Expands Cloud Computing Product Line

GoGrid, the cloud computing division of ServePath, this week announced the immediate availability of larger RAM, CPU, and persistent storage cloud server instances. The new 4 and 8 GB RAM cloud servers further broaden GoGrid's line of web and database cloud servers, enabling complete infrastructure in the cloud.

To bring higher performance server lines into the GoGrid cloudcenter, all 64-bit GoGrid images are now available in 4 and 8 GB RAM configurations. The 4 GB RAM server images can be deployed via the GoGrid web portal and API. The 8 GB RAM server images, however, currently may only be deployed via the GoGrid API.

The 4 and 8 GB RAM images, available for Red Hat Enterprise Linux 5.1, CentOS 5.1, and Windows Server 2003 and Windows Server 2008 64-bit operating systems, bring a new level of performance to the GoGrid line. 4 GB cloud servers have 3 CPU cores and 8 GB have 6 CPU cores, ensuring dedicated CPU allocations and high performance.

All GoGrid cloud servers come with persistent storage. The new larger RAM allocations announced today, are delivered with increased persistent storage: 4 GB cloud servers have 240 GB of hard drive space and 8 GB have 480 GB of storage allocated at boot time. Additional storage can be added using GoGrid's dynamically scalable cloud storage offering which includes a 10 GB free allotment to start with. Each 1 GB thereafter costs $0.15/GB/month.

More information about the new 4 and 8 GB RAM GoGrid cloud servers can be found here. Server Release Information on these new images can be found here.

Windows users are requested to read GoGrid's release and errata pages as there are some known issues specific to 8 GB Windows servers, which may require a workaround and that they should be aware of before using 8 GB GoGrid servers with Windows.

Ares is Now Number One in South America

Excerpted from Slyck Report by Thomas Mennecke

Ares Galaxy continues to be an enigma in the P2P community. 

The original creator of Ares, Alberto Treves, exited the project after converting it to open-source more than three years ago. 

However, because of its open-source nature, Ares continues to be developed and advanced. As one of the most popular applications on the open-source community website SourceForge, Ares enjoys a longevity few other file-sharing applications can emulate. 

Ares started its life as a Gnutella application during the early days of P2P networking. Alberto grew frustrated with the slow rate of progress during those times and decided to start his own network. 

The result was Ares Galaxy. Ares Galaxy did a great job for what it was designed to do: share and transfer small media files such as MP3s. 

By 2004, Ares Galaxy had well over 500,000 users. Although not as large as LimeWire or BitTorrent, Ares found itself a niche and a large support community.

But what's happened since? Gauging the popularity of the P2P community has become a tricky art, but the traffic management firm ipoque thinks it has a handle on the situation. In its Internet Study 2008/2009, ipoque found that the P2P population continued to rise, with BitTorrent still the overwhelming protocol of choice.

The surprising statistic ipoque found was that Ares Galaxy is the single most popular P2P protocol in South America. Out of all P2P protocols, 28% of traffic is consumed by Ares. Out of all Internet users, a stunning 68% use Ares. 

So what's the explanation? Ipoque couldn't find a rational explanation for this anomaly. "It is striking how popular P2P file sharing is in South America," the report reads.

"While we recorded only about 20% P2P users in our previous study, a number supported by other studies as well, it is much higher at the South American ISP. 

There are four P2P protocols used by more than 10% of the subscribers - Ares, BitTorrent, eDonkey, and Gnutella. The worldwide most popular protocols BitTorrent and eDonkey are both used by nearly 40%. 

Ares has an unusually high popularity in this region with a 64% user base. One possible reason could be the availability of Spanish and Portuguese language content, but this is no sufficient explanation because there is no similar Ares user base in Southwestern Europe."

It could be many factors - or quite simply, because it provides an open-source, spyware-free, gateway to a world of file sharing.

New Tech Start-Ups Rise from Economy's Ashes

Excerpted from USA Today Report by Jon Swartz

It's boom - and bust - for Silicon Valley companies these days. Literally.

Facing their worst economic climate since the dot-com bust in the early 2000s, high-tech companies are treating 2009 with dread - but also with a tinge of optimism if they act smartly.

Already, a few established companies with ample cash reserves are bolstering war chests that will help them snap up innovative start-ups. Cisco Systems has $29.5 billion in cash reserves and last week sold $4 billion more in bonds. Despite 5,000 layoffs, Microsoft plans to do some strategic hiring to fill new jobs supporting Internet search. And that well could involve acquisitions to pick up talented workers.

Companies are looking to improve efficiencies with cutting-edge technology. Intel says it will spend $7 billion over the next two years to build advanced manufacturing facilities in the US. The plants would produce faster, smaller chips that consume less energy.

"If we want to see a return of American prosperity, we have no other choice than to invest in creating the future, not merely preserving the past," says Intel CEO Paul Otellini.

Still, as the recession wears on, tech analysts say consolidation is likely to remake some tech sector companies. More layoffs could be on the way as companies alter strategies. Droves of start-ups, such as data-management provider Attune Systems, have pulled the plug on operations, while others have sold at fire-sale prices.

But from the ashes, dazzling new start-ups could arise. Previous recessions have coincided with the emergence of companies such as Cisco (during the 1987 crash) and Facebook and MySpace (shortly after the dot-com crash).

"A good forest fire cleans out the prairie," says renowned venture capitalist Steve Jurvetson. Start-ups unburdened by debt or history and cash-rich big companies "thrive on disruption," he says.

Please click here for the full report - especially the section on Cost-Saving Tech Services Are in Demand.

Q&A: Nettwerk Music Group's Terry McBride

Excerpted from Canadian Business Report by Andrea Jezovit

With unauthorized downloading on the rise and CD sales plummeting, record labels are in trouble. And according to many, it's all the fault of the "millennial" generation - under-27-year-olds who have been filling iPods with unlicensed downloaded tracks and don't intend to stop.

But Terry McBride, Founder & CEO of Canadian label and artist management firm Nettwerk Music Group, and author of the report Meet the Millennials, thinks there's hope, if labels embrace millennials and look at new ways of generating revenue.

McBride talked to Andrea Jezovit about how he's been doing this at Nettwerk, and about where the industry is headed. Please click here for the full interview.

Obama Team Mulls Constitutionality of Copyright Act

Excerpted from Wired News Report by David Kravets

In a few weeks, we'll likely know the Obama administration's position on whether it supports hefty monetary awards in file-sharing litigation brought by the Recording Industry Association of America (RIAA).

The Bush administration's position was clear. It supported the Copyright Act's penalties of up to $150,000 per infringed song.

"Congress acted reasonably in crafting the current incarnation by ensuring that it serves both a compensatory and deterrent purpose. Congress established a damages range that provides compensation for copyright owners in a regime in which actual damages are hard to quantify," the Bush administration wrote in 2007.

Now it's President Barack Obama's turn, and we'll see how tight he is with Hollywood.

On Tuesday, the Obama administration told a Pennsylvania federal judge weighing a constitutional challenge to the 1976 Copyright Act that it likely would divulge whether it believes damages under the act are unconstitutionally excessive by March 25th.

The Copyright Act is the law under which the RIAA has sued about 30,000 individuals for file sharing. Damages range from $750 a track to $150,000. At issue is whether the fines go against US Supreme Court precedent.

The minimum penalty under the Copyright Act equals a ratio of about 750 times the actual injury, assuming the value of a single music track costs $1 to purchase. 

Rulings by the US Supreme Court and other courts say financial punishments exceeding a 9-to-1 ratio are unconstitutional.

In 2007, a Minnesota jury ordered Jammie Thomas of Minnesota to pay the RIAA $222,000 for unlawfully sharing 24 tracks on the Kazaa file-sharing network, in the only case of its kind to go to trial. A retrial is set for next month after the judge declared a mistrial because of faulty jury instructions.

Cox Communications Explains Network Trial

Excerpted from Communication Technology Report by Jonathan Tombes

Cox Communications' high-speed data network congestion trial began last week in Kansas and Arkansas. But the trial itself has been on trial since being announced three weeks ago. 

The battle lines formed quickly. In a January 28th post on DSL Reports, Karl Bode leaned on comments from the FreePress, a group that advocates the reform of big media, and the engineer who discovered network-throttling efforts at Cox in late 2007.

Now that the network trial has actually begun, Cox has begun a quiet counter-offensive, "the first wave of pulling the curtain back on its new approach to congestion management," said Cox Director of Media Relations David Grabert. 

Cox SVP Technology Jay Rolls said congestion was a "corner case," i.e., the kind of problem that occurs outside normal operation parameters. "Most of the network is humming away." 

When congestion does occur, Rolls said that the new approach being trialed is to put the traffic into two buckets, the time-sensitive and non-time sensitive. The former service flows being noticeable to the customer when they start to delay. "Those services we'd like to leave alone," Rolls said. 

In the event of congestion, data network equipment treats the non-time sensitive services differently. "We slow that traffic down in order to relieve congestion," Rolls said. "We're talking on a per-packet basis, seconds or sub-seconds." 

That kind of delay on time-sensitive flows, such as VoIP, could be devastating. While packet aware, the technique does not label all P2P applications as eligible for delay. 

"There are plenty of streaming video services that are served by a P2P application," Rolls said. "Those will be deemed time-sensitive and will be advantaged by this scheme." 

How the Cox outreach to interested parties fares, remains to be seen. Network neutrality absolutists believe that all packets are created equal and regard distinguishing one from another as invidious discrimination. 

Other points raised in online discussion of Cox data network policies include the claim that Cox has signed an agreement with the recording industry regarding enforcement of the Digital Millenium Copyright Act (DMCA). "We have not," said Grabert.

And the question of whether Cox is using this congestion technique as a way to delay rolling out DOCSIS 3.0. "We're close to launching," said Rolls. 

Rolls hopes to begin seeing data from the trial within "a week or two."

How Piracy Paved the Way in Sweden

Excerpted from CNET News Report by Matt Lewan

The trial against The Pirate Bay (TPB) began Monday in Sweden. And while Sweden is depicted by copyright-enforcement groups as piracy's promised land, it is also a nation that experiments with legal music-service alternatives.

The case against the founders of Piratebay.org - one of the world's three major BitTorrent sites - is expected to last 13 days, which would make it Sweden's longest-ever trial dealing with copyright issues. The case is the result of the search-and-seizure of servers by Swedish police at TPB's offices in May 2006.

For years, the International Federation of the Phonographic Industry (IFPI) and the Motion Picture Association of America (MPAA) have depicted Sweden as rife with digital copyright infringement.

On a mash-up created with Google Maps, TPB itself shows where file-sharing users are located: most are in China (22%) and the US (11%). Sweden (2%) is clearly over-represented, which might partly be explained by the fact that broadband connections are widely used throughout the country.

During the time leading up to the trial, though, at least three innovative, licensed alternatives for listening to digital music have been launched in Sweden: Spotify, Tunerec, and Chilirec.

"It helped us see that there's something wrong when an unauthorized alternative defeats a licensed one. We wanted to solve the problem of playing music on the Internet and find a model that would work for artists, users, and advertisers," said Daniel Ek, Co-Founder and CEO of Spotify.

P2P offering Spotify has forged agreements with organizations such as Universal Music Group (UMG), Sony BMG, EMI Music, Warner Music Group (WMG), Merlin, The Orchard, and CD Baby; and now offers millions of songs streamed online. Subscribers pay about $12 a month and can listen to any song at any time.

But there's even more buzz about Spotify's alternative offer, a non-paid service, completely free, that's currently open only for a limited group of invited users (except in the UK, where Spotify a few days ago opened it up for anyone who wants to register). It's ad-financed, with a short commercial message being played a couple of times per hour, between two songs, whereas the paid service is ad-free.

Chilirec and Tunerec, by contrast, offer a kind of personal Internet-based storage that records music from Internet radio stations worldwide, continually, resulting in a huge amount of songs stored in a short time that people have the right to listen to whenever they want, without ever downloading them.

The basic idea is that because the songs are recorded in a personal disk space for each user, it is to be considered private recording of radio music for personal use, which is perfectly permissible.

Tunerec actually has an agreement with IFPI and the Swedish copyright organization STIM. Chilirec has closed its beta, stating that it is now working on the design of a commercial product.

We end up with three elegant solutions, at a time when copyright owners and authorities are trying to solve the online coyright infringement problem with law enforcement.

All three depend on people being online since they don't offer downloading. It's likely only a matter of time before they also offer that feature, though. And when they do, they will probably use BitTorrent or similar file-sharing technologies as effective ways to distribute large files.

Where do we end up? Having people downloading and listening to all kinds of music, without paying, using file sharing. It seems familiar, but it will be licensed and commercially viable. So did we really have to endure all the mess with hopeless legal efforts? It seems so.

Law enforcement is certainly giving people one reason to choose licensed alternatives instead of unauthorized ones, but for years we have seen that it is not enough. Licensed ways to consume digital music must also be extremely easy to use and have a very competitive price, which requires new ideas that both record companies and copyright enforcers have failed to produce.

These new ideas are instead popping up from companies that view a business opportunity where old models are failing. From that perspective, one might arrive at the conclusion that piracy actually showed the way.

Coming Events of Interest

Digital Music Forum East - February 25th-26th in New York, NY. Participants include top label execs, artists and reps, association heads, attorneys, investors, consumer electronics, plus technology leaders from social networks, payments companies, online retailers, mobile companies, technology start-ups, and more.

East Coast Music Awards - February 26th - March 1st in Corner Brook, NL, Canada. Live, original music during a four-day festival. Terry McBride, Co-Founder & CEO of Nettwerk Music Group, will be the keynote speaker for the conference component of the ECMA weekend.

P2P MARKET CONFERENCE - March 17th in New York, NY. Strategies to fulfill the multi-billion dollar revenue potential of the P2P and social network 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 18th-19th in New York, NY. Sponsored by McGraw-Hill and Digital Hollywood, the 2009 MSNY is the premier international conference on media, broadband, advertising, television, cable & satellite, mobile, publishing, radio, magazines, news & print media, and marketing.

Future of Television West - March 24th-25th in Los Angeles, CA. A cutting-edge community of content creators, technology innovators, advertising representatives, and distributors forge relationships and share ideas about the future of television. The event is interactive.

LA Games Conference - April 28th-29th in Los Angeles, CA. Focused on business, finance and creative developments in the games industry, including mobile, online and console markets and the increasing intersection of Madison Avenue and Hollywood with the industry.

P2P MEDIA SUMMIT LA - May 4th in Santa Monica, CA. The fourth annual P2PMSLA, the DCIA's flagship event, featuring keynotes from industry-leading P2P and social network operators; tracks on policy, technology and marketing; panel discussions covering content distribution and solutions development; valuable workshops; networking opportunities; and more.

Digital Hollywood Spring - May 5th-7th in Santa Monica, CA. With many new sessions and feature events, DHS has become the premiere digital entertainment conference and exposition. DCIA Member companies will exhibit and speak on a number of panels.

Streaming Media East - May 12th-13th in New York, NY. The number-one place to see, learn, and discuss what is taking place with all forms of online video business models and technology. Content owners, viral video creators, online marketers, enterprise corporations, broadcast professionals, ad agencies, and educators.

World Copyright Summit - June 9th-10th in Washington, DC. The international forum that brings together all those directly involved in creative industries to openly debate the future of copyright and the distribution of creative works in the digital era. WCS is organized by CISAC, the International Confederation of Societies of Authors and Composers.

Copyright 2008 Distributed Computing Industry Association
This page last updated March 1, 2009
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