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September 21, 2009
Volume XXVII, Issue 12

Solid State Networks Offers Free Game-Publishing Software

Solid State Networks, the leading developer of P2P-based game-publishing software, this week announced its plan to make the upcoming release of CURRENT 3.0 available to game developers free of charge for commercial use.

Built using the company's proven delivery technology, CURRENT 3.0 provides a unified platform for downloading, installing, patching, and launching games. The upcoming free version will enable developers to provide players with a quality user experience while acquiring games and updates.

Developers will have a variety of features at differing price points that can be activated to further enhance the game acquisition experience. These optional upgrades will include robust delivery solutions, such as hybrid CDN/P2P, patching optimizations, and support for DIRECT, Solid State's game portal software that supports dynamic web content.

"We are pleased to provide developers with a robust solution that they can deploy quickly to enhance the game acquisition experience for their players - and do it without impacting their existing budgets," said Rick Buonincontri, Founder and CEO of Solid State Networks.

"Developers will have the opportunity to see our solution in action at no cost. Not only can they save development time and money by using a readily available and supported solution, but they can easily extend and customize the software to create new revenue-generating opportunities, all with the confidence of using industry-proven technology."

Developers can request a copy of CURRENT 3.0 by clicking here.

Oversi & Spotify Named Readers' Choice Award Finalists

An overwhelming 5,500+ votes were cast for more than 200 products in the first annual Streaming Media European Readers' Choice Awards. Winners in each of 12 categories will be announced during a reception on October 15th at Streaming Media Europe, but the finalists, representing the top three vote-getters in each category, were announced this week. 

Included among the finalists in the "Delivery Network" category for edge or P2P content delivery providers is Oversi for its OverCache MSP product.

Oversi offers a breakthrough multi-service platform for over-the-top (OTT) content, including Internet video, P2P, and other media applications. Oversi's solutions enable service providers to cope with the huge traffic load on their networks while significantly improving subscribers' quality of experience (QoE).

By assuring QoE, Oversi's solutions open up new monetization opportunities with content providers and facilitate the delivery of tiered services, increasing average revenue per user (ARPU). Oversi systems are deployed in service provider sites around the world. Oversi has offices and representatives in EMEA, the US, Asia-Pacific, and Latin America.

Included in the "Music & Audio Delivery Platform category for Music download services, internet radio, and music sharing is Spotify for its proprietary P2P music streaming service.

Spotify allows instant listening to specific tracks or albums with almost no buffering delay. Music can be browsed by artists, albums or created playlists as well as by direct searches. The program/service is now available in parts of Western Europe.

Report from CEO Marty Lafferty

Photo of CEO Marty LaffertyWhile we anticipate the announcement of network neutrality guidelines by US Federal Communications Commission (FCC) Chairman Julius Genachowski on Monday, the DCIA proudly announces the agenda and principal speakers for our upcoming P2P & GAMES CONFERENCE.

This first-ever P2P & GAMES CONFERENCE is scheduled for Thursday October 22nd in the Catalina Room at Loews Santa Monica Beach Hotel in Los Angeles, CA, and is being held in conjunction with Digital Hollywood Fall.

The P2P & GAMES CONFERENCE will focus on business models, delivery services, and case studies that demonstrate the benefits of P2P and cloud computing for the distribution of games and game updates to networked devices - from PCs to consoles to mobile-phones.

Keynote speakers include Jim Kott, Co-President, Abacast; Scott Tilghman & Daniel Ernst, Principals, Hudson Square Research; Arthur Pober, American Associate, European Advertising Standards Alliance (EASA); Joe Porus & Milt Ellis, Vice Presidents, Harris Interactive; Chris Hennebery, Director of Software Distribution, Yummy Interactive; Scott Ryan, President & CEO, Asankya; Eric Klinker, Chief Executive Officer (CEO), BitTorrent; Robert Levitan, Chief Executive Officer (CEO), Pando Networks; and Nicholas Longano, CEO & Founder, Music Mogul.

The conference offers a very exciting agenda of keynotes and panel sessions featuring industry leaders at the forefront of this new category. There will also be a continental breakfast and conference luncheon.

The Consumer Protection panel will focus on P2P gamer issues and examine the key user concerns that must be addressed to ensure long-term customer satisfaction.

Panelists include Hal Bringman, Founder & President, NVPR; Russell Frackman, Partner, Mitchell Silberberg & Knupp; Robert Hunter, Digital Rights Consultant, Entertainment Consumers Association (ECA); Steve Masur, Managing Partner, MasurLaw; Seth Shapiro, Principal, New Amsterdam Media; and Chris Ullrich, Writer / Producer, Flickcast.

The Content Protection panel will explore games publisher issues, and analyze the key intellectual property concerns that must be addressed to achieve optimal commercial success.

Panelists include Jim Burger, Member, Dow Lohnes; Max Davis, Director, DataRevenue.Org; Mark Isherwood, Senior Consultant, Rightscom; Mark Ishikawa, CEO & Co-Founder, BayTSP; Michael Perricone, Principal, Omstream; and Rich Roberts, VP of Sales & Business Development, PlayFirst.

Laura Tunberg, of DCIA Member Services and We Get It Consulting, will moderate. Additional P2P & GAMES CONFERENCE speakers will be announced in coming weeks.

To extend the reach of the P2P & GAMES CONFERENCE to those unable to travel to Los Angeles, the DCIA is partnering with Abacast to produce a live interactive webcast of the event. In addition to being available in real-time, the webcast will also be recorded and viewable on-demand after the conference.

To sponsor or exhibit at the P2P & GAMES CONFERENCE and for DCIA Membership and speaker information, please contact Karen Kaplowitz at 888-890-4240.

The P2P & GAMES CONFERENCE is being held in conjunction with Digital Hollywood Fall, and registration for both events yields a substantial savings for attendees. For more information, please click here.

Pre-registration rates, which offer even more savings, end October 15th. To register, please click here. Share wisely, and take care.

PlayFirst Scores in App Store with 99-Cent Casual Game

Excerpted from Pocket Gamer Report by Jon Jordan

GDC Austin used to be all about online gaming, but 2009 has seen a steady stream of iPhone publishers and developers talking about their games. 

One such publisher is casual web company PlayFirst, which has been cautiously bringing its time-management brands such as "Diner Dash" and "Cooking Dash" to the App Store. 

According to Gamasutra, iPhone Product Manager Chris Williams said it initially ported PC games to iPhone, but over time, the market has become much more sophisticated, and its games are now developed specifically for the iDevices. Yet, even with such brands, the decision to make an iPhone game isn't treated lightly. 

As well as thinking about user interface, you need to understand what the audience really wants, especially if you're bringing an existing game to the iPhone. 

Companies also need to have a good idea of competing products. "I am acutely aware of every casual time-management game that comes out on iPhone, I play them, and do feature comparisons," Williams said. "And pricing is vital." 

"If you want to get into the top 10 or the top 20, you're going to be 99 cents unless you're a monster brand. But there's plenty of money to be made in the 20-60 range," he said. "

Unless you have a really powerful brand or you're going to give it away at the 99-cent price point, you need to make it feel native to the platform. This stuff is hard to deal with if you have an existing game brand that was conceived on another platform," he explained. 

Significantly, "Cooking Dash" was released at 99 cents and peaked at #2 in the US App Store.

More Games Companies Select Pando Networks

Pando Networks, a leading provider of Content Delivery Cloud services, this week announced that several more leading game companies have deployed Pando's services during the past four months. Turbine, Ndoors, Gala-Net, LevelUp, and Outspark are the most recent leading game companies to deploy Pando's Content Delivery Cloud services to optimize their online game distribution.

The Pando Content Delivery Cloud seamlessly integrates with any CDN configuration and optimizes data delivery from both CDN servers and peer nodes. The Pando service accelerates download speeds while significantly reducing delivery costs. The Pando Content Delivery Cloud is more scalable than a stand-alone CDN delivery service because as download demand increases, Pando network capacity expands and performance improves. This is especially important for online game distribution as new releases of popular games frequently result in a sudden surge in download demand that can degrade CDN performance and the end user experience.

"We are proud that leaders in the rapidly expanding online game business such as Turbine, Ndoors, Gala-Net, LevelUp, and Outspark have selected Pando Networks to optimize the delivery of their popular games," said Robert Levitan, CEO of Pando Networks.

"Digital distribution is an important part of any online games acquisition strategy and Turbine is always looking to improve the download experience for our players," said Chris Dyl, CTO of Turbine. "After testing Pando's technology to distribute Turbine's products, we were very pleased with the results. Not only did we see an increase in download speeds and completion rates, the Pando downloader demonstrated that it would significantly reduce Turbine's content delivery costs by utilizing a state-of-the-art P2P download technology."

Pando also provides partners with detailed performance data that goes far beyond traditional reporting metrics. Julio Vieitez, Managing Director for Level Up! Brazil, said, "Now that we are working with Pando, we are receiving daily business metrics that help us better understand the gamer experience with downloading our games as well as the economics of customer acquisition and support."

"Pando delivers aesthetically pleasing and technically elegant solutions that give our users the top-tier service we demand," said Derek Marcial, VP, Engineering of Outspark. "Since we began using their services, we've seen improved download completion rates and increased overall efficiency. More importantly, they are always responsive to our needs, and their quick and agile responses to our requests make them one of our preferred partners."

Pando Networks now optimizes the digital distribution of some of the most popular online games including "The Lord of the Rings Online," "Dungeons and Dragons Online," "MapleStory," "Grand Chase," "Ragnarok," "PerfectWorld," "Fiesta," "Luna Online," "Rappelz," "Flyff," and "Atlantica Online."

Game Publisher Majesco to Raise $9.63 Million in Offering

Excerpted from Digital Media Wire Report by Mark Hefflinger

Videogame publisher Majesco Entertainment announced on Thursday that it plans to raise $9.63 million in a registered direct offering with select institutional investors. 

The offering includes the sale and issuance of 6.4 million shares of Majesco at a price of $1.50 per share. The sale is expected to close on September 22nd. 

New Jersey-based Majesco's more recent franchises include "Cooking Mama," "Cake Mania," and "Jillian Michaels' Fitness Ultimatum 2009."

Continent of the Ninth Goes to P2P Mode in Korea

Excerpted from MMORPG News

The new Korea-made action role-playing game (RPG) Continent of the Ninth (C9) was to implement its micro-transaction business model starting at the end of last week. And starting September 21st, players will also have to pay for enjoying the game in the committed net cafes.

The implementation of the micro-transaction business model in C9 actually comes to players earlier than expected. NHN Games once stated that more game content would be introduced in C9 in the future, so they did not hurry in initiating the pay-to-play (P2P) mode.

In this respect, the director Zae Min Shin from NHN explained that the micro-transaction business model was started in advance not for more benefits but for the sake of having players get their necessary items. If the game was not affected in the aspect of balance, they would not have carried out the micro-transaction model so early.

According to Zae Min Shin, the release of Continent of the Third (C3) was just the focus of this update, and the newly unveiled game content would also present the audience with unique gameplay enjoyable in C9.

Generating Cash for Premium Flash Games

Excerpted from Gamasutra Report by Paul Hyman

Micro-transactions are doing a bang-up job of paying the freight for free-to-play massively multiplayer online games (MMOGs), as well as for Facebook and other social networking games. So what's keeping developers of premium, single-player Flash games from following suit?

Nothing, actually. In fact, a few brave souls have made the leap to micro-transactions and seem to be doing quite well, thank you. And they're predicting that micro-transaction funding will enable them to afford longer development periods - say six months instead of two - and larger teams that will result in Flash games with more content, better graphics and sound, and deeper mechanics.

Call it a win-win situation for the developers as well as for the gamers, even the ones who choose to play for free. Nevertheless, developers expected - and have gotten - some resistance from their fans.

Chris Harris recalls that when his company, New Zealand-based Ninja Kiwi Games, first posted zombie shooter SAS: Zombie Assault 2 on the Flash-dedicated portal Newgrounds, "There were quite a few expletives and loud comments like 'This is BS' and 'You're just ripping people off.' I'm sure that was because some gamers are just set in their ways. They reacted exactly the same way when pre-game ads were introduced. It's almost like introducing some new piece of technology to the elderly."

But, done correctly, games designed with micro-transactions in mind need not infuriate gamers. Harris recalls that his team was careful to build a complete game for those who just want to play - and beat - the game for free.

"You can go through all 30 levels of 'SAS' without paying a dime," he says. "We believe that to be very important. And people who don't mind forking over a few dollars for extra content can go to the premium license tab and buy some kick-ass guns, the ability to regenerate health, and even something called 'guardian angel' which lets you continue from where you died."

Most transactions cost $1 each, with the most profitable item - the Zombie-Popping Party Pack, which supplies all guns, all upgrades, everything - about $9.

What enables the game's pay-for-content mechanics is Mochi Media's MochiCoins system; gamers use MochiCoins in their account which they purchased using credit cards or PayPal. Similar micro-payment transaction systems are offered by Heyzap and GameSafe.

Ninja Kiwi built "SAS" with MochiCoins in mind, having rejected the idea of funding the game using pre-game advertising exclusively, as in its earlier games.

Please click here for the rest of this report.

Kontiki Provides Support for Flash Video Streaming

Kontiki, the leading provider of peer-assisted enterprise video delivery solutions, now provides native support for the popular Adobe Flash video format. Support for the format means that corporate communication and IT teams can use Kontiki's video delivery management system to provide employees with high quality on-demand videos developed in Flash without negatively impacting network bandwidth.

With this news, Kontiki extends enterprise investments in Flash video production by making existing and new video content able to be viewed both within the company and on customer facing portals.

Kontiki CEO Eric Armstrong says support for Flash technology was a priority for the Kontiki development team in its drive toward the latest product release. High-quality online video, whether it's live, streamed on-demand, downloaded, or pushed, can help businesses connect with employees in a way that email and other forms of corporate communication can't.

"Flash is possibly the most widely adopted video format, which means that companies have access to a large pool of resources to cost-effectively develop and deliver critical corporate communications. The development team understood the need for native support in order to let organizations with Flash video assets take full advantage of Kontiki's features," Armstrong concludes.

Kontiki's delivery management system also provides reporting on user plays and how much of the video each user watched. The latest version of Microsoft's browser, Internet Explorer 8, is also now fully supported for use with Kontiki.

Kontiki's unique approach can securely reach every employee in a company with a desktop computer and in any location around the globe through its patented peer-assisted video delivery technology. Kontiki significantly increases the capacity of existing infrastructure to deliver high-quality live, on-demand, download or push video, company-wide, without additional hardware expenses or dedicated IT staff. Its robust functionality offers multiple delivery options, e-mail integration, portal search and discovery, security and analytics. Kontiki solutions can be implemented in a few short weeks to thousands of employees worldwide.

Bram Cohen to Deliver BitTorrent Live Streaming

Excerpted from TorrentFreak Report

Bram Cohen, the inventor of the BitTorrent protocol that revolutionized file sharing, is working on BitTorrent-based live streaming. With his efforts he aims to develop a piece of code that is superior to all the other P2P-based streaming solutions on the market today.

The online video streaming revolution has hugely increased the use of bandwidth by individual consumers. At the same time it's also resulting in huge bandwidth bills for streaming sites such as YouTube.

Thus far the demand for video continues to grow, and it is even expanding to live video. To keep video services from collapsing and to save bandwidth costs, it seems almost inevitable that content providers will have to look at P2P-based streaming solutions. Last year we reported that CNN had experimented with a P2P-based live stream, and the Tribler research team has already shown that it's possible to use BitTorrent to stream live footage.

There are currently a few dozen people working on P2P-based live streaming, and they are soon to be joined by Bram Cohen, the inventor of BitTorrent. Last week he tweeted that he will beat Tribler's solution in terms of delay. "I'm going for a less-than-five-second delay," he wrote.

"I think there's a very large market for live streaming in general, and to date no one has proven that a P2P solution can meet the real-world requirements for being an acceptable live solution. I intend on changing that," Bram told us.

There are still a lot of problems to solve though, before the first version becomes available to the public. Getting BitTorrent to work effectively with live streams requires several major adjustments.

"Doing live properly is a hard problem, and while I could have a working thing relatively quickly, I'm doing everything the 'right' way," Cohen told TorrentFreak. He further explained that everything has to be redone in order to make BitTorrent compatible with live streams, "including ditching TCP and using congestion control algorithms different from the ones we've made for UTP," he said.

"I am fundamentally a technologist, and am simply not interested in working on something which doesn't solve the fundamental problem it's supposed to tackle, especially in a market where there have already been so many bad technologies which failed to succeed based on sales and marketing," he added.

Please click here for the rest of the report.

BuyDRM Launches KeyOS Smooth DRM Service for Smooth Streaming

BuyDRM, the leader in rights management solutions for premium digital media, is further enhancing its KeyOS platform with the addition of the KeyOS Smooth DRM Service for Microsoft Internet Information Services (IIS) Smooth Streaming content, to better meet the growing demand for true high-definition (HD) video (1080p) with uninterrupted delivery.

The KeyOS Smooth DRM Service provides an integrated content encryption and license delivery platform that supports the most popular business models including Pay-Per-View, Subscription and Ad-Supported methods for both live and on-demand content.

To streamline the live encryption process for IIS Smooth Streaming, BuyDRM has partnered with encoding industry leader InletHD to integrate the KeyOS Smooth DRM Service into the Inlet Spinnaker 4.1 release slated for later this month. Spinnaker users will be able to apply real-time PlayReady encryption to their IIS Smooth Streaming content merely by selecting KeyOS from a drop-down menu in the Spinnaker software. All key exchange between Spinnaker and KeyOS is secure, robust and fully automated.

"Inlet Technologies is pleased to partner with BuyDRM to provide another market-leading innovation in streaming," said John Bishop, senior VP of business development and strategy, Inlet Technologies. "BuyDRM's built-in support of KeyOS in Inlet's Spinnaker will allow customers to quickly and easily take advantage of IIS Smooth Streaming and PlayReady technologies, giving viewers a fantastic experience while at the same time giving content owners confidence that their content is fully protected."

"As a leader in this space, BuyDRM has rolled out yet another DRM technology improvement to KeyOS that provides our customers with future-proofed solutions for their premium content" said Christopher Levy, CEO, BuyDRM . "This inclusion of KeyOS Support in Spinnaker 4.1 will make the application of industrial-strength DRM a transparent process while decreasing the complexity of deploying DRM."

"BuyDRM has developed a robust Smooth DRM Service for IIS Smooth Streaming content playback to Microsoft Silverlight-based media players," said Steve Sklepowich, director for Silverlight at Microsoft Corp. "Microsoft looks forward to working closely with BuyDRM to create high quality video experiences for users of premium digital media protected experiences."

CloudShield Technologies Appoints Timothy Laehy as CFO

CloudShield Technologies, a leading provider of service management and infrastructure security solutions, has selected Timothy Laehy as Chief Financial Officer (CFO). Laehy will be responsible for the financial direction of the company, reporting directly to CEO Matt Jones.

"As CloudShield continues to grow within tier 1 service provider, government agency, and commercial markets, we will rely on Tim to spearhead our continued financial growth," said Jones. "Tim's experience in providing the financial and operational leadership necessary to scale emerging technology companies - both private and publicly-held - will be a valued asset to CloudShield's management team."

Laehy is a senior-level financial executive with over 20 years' experience in the service provider, software, and manufacturing markets. Prior to joining CloudShield, he was the CFO of MetroF, a wireless broadband service provider. He also led Collation, a supplier of data center configuration management software, through its acquisition by IBM Software Group in 2005 as CFO. Laehy has also held senior financial roles with Covad Communications, Leasing Solutions, and Recovery Equity Partners. He received a BS in Business / Economics and an MBA in Finance from State University of New York (SUNY) at Buffalo.

"CloudShield has been experiencing a period of impressive growth in terms of market share, key partnerships, and product development," said Laehy. "As a leading provider of carrier-class network solutions, CloudShield is in an ideal position to support emerging technologies such as cloud computing and secure against the latest DDoS attacks and other Internet threats. In my role, I look forward to capitalizing on the company's technological innovations to drive unparalleled financial growth."

CloudShield is a private company that sells to the world's largest network service providers and national governments through its partners, including: Alcatel Lucent, IBM, L-3 Communications, and Northrop Grumman. CloudShield's unique high-speed network platform provides unmatched capabilities in the areas of network security, cross-domain solutions, content management, and network policy enforcement functions.

Spotify Mulling Different Approach for US Launch

Excerpted from Music Ally Report

The Wall Street Journal (WSJ) has an intriguing quote from leading P2P streaming music service Spotify's Andres Sehr on its planned US launch, saying that the company is "looking at a slightly different model in the US."

What that model is, he doesn't say specifically, although the WSJ suggests that instead of having two separate versions of the service - free and ad-funded, or premium and ad-free - Spotify will adopt a so-called "freemium" model in the US, where the service is free but users pay for certain features.

Which we guess qualifies as "slightly different," although we would have described the existing model as freemium, too. Sehr also reiterates that the launch may come this year or early next year, and that licensing deals are what is holding it up.

GigaTribe Announces Version 3 Social Sharing Software

GigaTribe announced this week the availability of GigaTribe Version 3 free file-sharing software - the must-have solution for online social communities to securely share unlimited amounts of photos, videos, music, and other files with their "tribes" of friends, in a private, fully-encrypted P2P environment.

Online social communities and forums don't have the ability to share unlimited large photos and videos, because the communities either don't have enough storage space, are too cumbersome to use, or because members don't want to share private content with everyone online. GigaTribe solves these issues by providing social communities with the ability to offer unlimited integrated private file-sharing capabilities in an easy-to-use instantly updated environment that can be securely controlled by their members.

"GigaTribe realized that many online communities were using it as an enhancement to their forums," said Alexis Leseigneur, Co-Founder of GigaTribe. "With Version 3, we decided to provide a stronger integration between the online communities and GigaTribe." 

Each member decides exactly what he or she wants to share and with whom. All his/her files remain in the private environment of their hard drive, always secure and up to date. Only the selected social community members see his/her files and they can decide whether or not they wish to download them.

Many photo and video communities are already using GigaTribe, including unique communities, such as members of the FlipJuke (pinball machine community) and JukeBox community who share instruction manuals; Xplane flight simulation game members who share add-ons; 93Bikers members who create huge videos that they want to keep private; and more.

New GigaTribe Version 3 offers these new customized features for online communities: GigaTribe's interface can be branded with the online community's logo and colors; communities can push their messages through a news page that is displayed each time GigaTribe is launched; GigaTribe users can get a list of all the community members who are also using the customized version of GigaTribe; an 'Add Contact' button will provide search features restricted to community members only; large communities will receive special discounts on licenses of GigaTribe's "Ultimate" version, with more advanced features.

For more information on customizing GigaTribe Version 3 for social communities, please click here.

Joltid Claims $75 Million a Day in Skype Action

Excerpted from Global Telecoms Business Report

The founders of Skype, Niklas Zennstrom and Janus Friis, are suing eBay for $75 million a day if the auction company continues to use patents that they lay claim to. But observers suggest it is a ploy to regain ownership of Skype.

Zennstrom and Friis are taking the action in a California court in the name of Joltid, a tiny London-based company in which they say they lodged the P2P patents that are vital to Skype's Internet telephony when they sold Skype itself to eBay in 2005 for $2.8 billion.

Now eBay wants to sell a 65% controlling interest in Skype for $1.9 billion to a group of private equity investors led by Marc Andreessen, the inventor of the Mosaic web browser and founder of Netscape. But Skype would be valueless if the company were no longer able to use the P2P technology that Joltid says it owns.

Joltid has named eBay as well as Andreessen and the Silver Lake private equity investor in its suit, as well as two former Skype board members. It wants Skype to stop using the patented technology in the US or pay damages of $75 million a day.

On its website, Joltid says it "holds a comprehensive portfolio of intellectual property including US patent 7,480,658, covering distributed database systems and coordinated decentralized P2P computing." The company was founded in 2001 "by the team who created Kazaa" - in other words, Zennstrom and Friis, who went on from the Kazaa P2P music system to create Skype.

Joltid says that "its current flagship product" is Global Index, which is describes as "the world's most technologically advanced, scalable and field-tested P2P technology", and adds: "The biggest implementation of Global Index to date has been Skype where Global Index enables P2P voice, video, and chat communications."

DCINFO Editor's Note: The NY Times reports further on how Skype Founders Escalate Legal Fight Over Sale.

Stunned Film & Music Sectors React to Veoh Decision

Excerpted from CNET News Report by Greg Sandoval

In the cafes along Sunset Boulevard and the high-rises on Fifth Avenue, executives and lawyers at powerful entertainment conglomerates were talking about industry leading peer-to-peer television (P2PTV) service Veoh on Tuesday morning.

They were not joyful discussions. Copyright owners in the film and music sectors were stunned Monday by the news that US District Judge A. Howard Matz ruled that Veoh is protected by the Digital Millennium Copyright Act's (DMCA) safe-harbor provision and cannot be held liable for acts of copyright infringement committed by users.

This was the most significant court victory that the tech sector has won against copyright owners in some time.

Universal Music Group (UMG) had filed suit against Veoh, but on Friday, the judge tossed the case out. UMG said it will file an appeal soon. While entertainment companies await the appeal, Matz's reading of the DMCA has shaken content producers.

Two entertainment attorneys from Los Angeles who asked for anonymity said the ruling "disappointed" many in their industries and absolutely isn't good for Viacom or any other copyright owner. Viacom filed a copyright lawsuit against Google and its YouTube two years ago. Some attorneys believe that Veoh's case is very similar to Viacom's.

What has so spooked the entertainment industry is that Matz would require content creators to play a cat-and-mouse game with those who upload unauthorized copies of films, songs, music videos, and TV shows onto websites.

In order to have a piece of content removed from a site such as Veoh or YouTube, they must file what is commonly referred to as a "take-down notice." If they get one clip pulled, someone could conceivably post the same clip thirty seconds later, and a content owner would have to file yet another notice, says Chris Castle, an attorney and outspoken proponent of artist rights.

Companies such as YouTube and Veoh have filtering technologies in place that help keep infringing materials off the site, and Fred von Lohmann, Senior Attorney at the Electronic Frontier Foundation (EFF), has always said there isn't any way for such services to determine what content is infringing and what isn't. The copyright owners, according to EFF, are in the best position to do that.

There's no arguing that YouTube was once more defiant and less interested in appeasing content creators than it is now. For the past couple of years, Google, which bought YouTube in 2006 for $1.65 billion, has wooed the film and music industries, and has signed all but one of the four major record labels and such studios as Disney, Sony Pictures, CBS, and MGM.

According to Doug Lichtman, a law professor at the University of California at Los Angeles (UCLA) and an attorney working for Viacom, many of the problems will be solved in the boardroom and not the courtroom.

"The most important anti-piracy efforts under way these days aren't cases but rather business initiatives," Lichtman said, "where the content community is struggling to figure out how to give consumers what they want, in forms they want, and at reasonable prices."

If that's the case, though, then why don't Google and Viacom send their attorneys home and cut a business deal whereby everyone makes money? Maybe it will still happen.

Music Artists Oppose Cut-Off Policy for Broadband File Sharers

Excerpted from ISP Review Report

The Featured Artists Coalition (FAC), which campaigns for the protection of performers' and musicians' rights, has announced its opposition to an amended UK government proposal that would force Internet service providers (ISPs) to disconnect customers suspected of downloading unlicensed music. 

The unexpected move pits popular artists directly against their own labels. However the coalition, which includes many recognizable names such as KT Tunstall and Radiohead, is no stranger to tackling big labels. Indeed their core aim has always been for all artists to have more control over their music and a much fairer share of any profits generated in the digital age.

FAC's statement reads: "We have serious reservations about the content and scope of the proposed legislation outlined in the consultation on file sharing. Processes of monitoring, notification, and sanction are not conducive to achieving a vibrant, functional, fair and competitive market for music. As a result, we believe that the specific questions asked by the consultation are not only unanswerable but indicate a mindset so far removed from that of the general public and music consumer that it seems an extraordinarily negative document." 

The very fuzzy estimates for the annual benefits of such legislation (£200 million per year) make clear that such estimates are based firmly upon the premise that a file-sharing downloaded track equals a lost sale. This "substitutional" argument is, in reality, no more than "lobbyists' speak." It has little support from logic and no economist would seek to weave such a number into a metric aimed at quantifying a "value gap" for the industries challenged by file sharing. 

In contrast to the lack of any credible evidence for the size of the substitutional effect, there is evidence that repeat file sharers of music are also repeat purchasers of music, movies, documentaries, etc. Recent research by MusicAlly has demonstrated the continued popularity of the CD as the purchased product of choice by many music fans. 

This combined with the continued significance of the CD in the revenue balance of record labels, suggests a much more complex equation in which file sharing may erode sales, but where it may also promote other revenue streams. For this reason it is dangerous to view the downloading of music as the direct online equivalent of CD sales.

Instead the FAC goes on to state that the proposals would also be very costly to implement and fail to differentiate between the downloading and sharing of music by music fans, on a non-commercial basis, and those who seek financial gain or commercial advantage from such activity.

The FAC statement continues: "This second group of 'commercial' file sharers and facilitators should be pursued with the full force of the law as is the case with illegal CD plants in the offline world. Ordinary music fans and consumers should not be criminalized because of the failings of a legacy sector of business to adapt sufficiently fast to new technological challenges."

This refreshingly different opinion from artists themselves is unlikely to be greeted warmly by big music labels, which still continue to believe that 7 million Brits have been involved in unauthorized online file-sharing activity; despite that figure being exposed as misleading. 

On the other hand it is also true to say that infringement should not merely be ignored. Indeed, some of the other technical proposals (e.g., blocking file-sharing sites, limiting connection speeds, etc.) were not totally unfair. 

True, it is easy to avoid restrictions like that, yet many casual consumers would still lack the knowledge to do so. Similarly the argument that somebody who downloads 1,000 unlicensed tracks may never have brought that many in the first place are fair but equally imperfect. The problem is not caused by the 1,000 tracks they download so much as the 5 they now no longer need to buy. 

Still, it is pleasing to see the FAC "vehemently oppose" new plans to get even tougher than the original Digital Britain proposals, which haven't even been given the chance to prove themselves. The FAC believes that the new proposals will alienate consumers and move the stick too far away from the carrot.

Rinse, Repeat: France Advances Another Disconnection Bill

Excerpted from Digital Music News Report 

Is France destined to get its three-strikes disconnection bill, in one form or another? The last two tries have been failures, though another attempt has now passed both chambers of Parliament. 

But this time around, legislators were forced to modify the terms of their proposed law, thanks to an earlier rejection on constitutional grounds. 

The earlier, harsher version of the bill was blocked by the French Constitutional Council, based on a lack of due process. In the modified reattempt, a judge would be involved, though disconnections could be fast-tracked and batch-processed to give the measure some bite. 

The streamlined process would actually suspend connections, for as much as one year, even if the owner of the line was unaware of the violations (for example, because of third-party file-sharing on a WiFi account). So, how close to law is this? 

The new bill, dubbed "HADOPI 2," just passed the National Assembly by a 285-225 vote. The Senate has already approved the measure, though some constitutional challenges could remain.

Coming Events of Interest

New York Games Conference - September 30th in New York, NY. Join games industry leaders - including leading videogame publishers and developers, carriers, portals, technology companies, advertising execs, venture capitalists, lawyers, analysts, and many more.

FMC Policy Summit 2009 - October 4th-6th in Washington, DC. Future of Music's (FMC) annual event where, this year, music, technology, policy and law are going "back to the future." Early-bird discounts are now available.

BayTSP Online Trends & Insight Conference - October 14th-15th in Los Gatos, CA. Topics include advances in digital distribution of content, the state of TV piracy, new uses for business intelligence and monetization in the entertainment industry, graduated response, and anti-piracy litigation trends.

P2P and Games Conference - October 22nd in Santa Monica, CA. The DCIA's first-ever event focusing on the use of P2P and cloud computing technologies for the distribution of games and updates. Industry leaders from around the world will participate.

Digital Hollywood Fall - October 19th-22nd in Santa Monica, CA. With many new sessions and feature events, DHF has become the premiere digital entertainment conference and exposition. DCIA Member companies will exhibit and speak on a number of panels.

Cloud Computing Expo - November 2nd-4th in Santa Clara, CA. Fourth international conference on this subject. Cloud computing is a game changer. The cloud is disrupting traditional software and hardware business models by disrupting how IT service gets delivered.

P2P MEDIA SUMMIT at CES - January 6th in Las Vegas, NV. The DCIA's seminal industry event, featuring keynotes from top P2P and cloud computing software companies; tracks on policy, technology, and marketing; panel discussions covering content distribution and solutions development.

2010 International CES - January 6th-10th in Las Vegas, NV. The industry's largest educational forum to help companies expand their businesses and understand new technology. Over 200 conferences and more than 300 expert speakers encompass International CES.

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This page last updated September 27, 2009
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