P2P, Piracy, and other things – by “Matt A”

Peer-to-peer networks have come under a lot of fire over the past few years. Some of them have been able to slide under the radar by being very selective about their members, others have faced serious litigation, and a few have won their battles by squirming into the light of the DMCA’s safe harbor. One thing that hasn’t changed, however, is the technology. BitTorrent clients are freely available for download, and can be found easily with just minimal effort. P2P use scales beautifully: the more people using the service, the faster the downloads. And ever so slowly, its beginning to catch on as more and more legitimate means for distribution. Twitter is launching a new service based on BitTorrent technology to help lower the downtime on their central servers; instead of sending out updates to their various servers world-wide and rely on a lengthy direct download process, they will be using their servers as seeds in their own private swarm (it should also be noted that this project is named Murder for the flock of crows, not premeditated homicide). While this doesn’t involve the public as direct seeders, it still is a very valuable look at the legitimacy of P2P downloads. Another example, and indeed one of my favorites, is that of World of Warcraft, which has been using P2P technology to deliver its content for years. Granted the system isn’t ideal (it only seeds while downloading to avoid posing any undue bandwidth issues during play) and trying to deliver half a gigabyte of information to over 13 million people (or whatever the current number is) simultaneously without dedicated seeders upon completion isn’t the ideal system, but it improves download speeds regardless.

Now lets talk about piracy a little bit. Piracy has been intimately connected with P2P ever since it strolled out into the daylight. Lots of people with the same idea in mind using software that connects them, with the added benefit that the more connected they are, the faster their downloads? A match made in heaven. But P2P and its use for file-sharing runs into some moral boundaries and arguments. Is file-sharing a new distribution method or just plain stealing? Is it fighting the powerful ‘evil’ corporate machine or killing music and creativity? Then the economics arguments come in. Music can’t work this way, it will never happen! Or, music is a cultural phenomenon, it won’t respond to market forces. But this isn’t true. Economics works as it always does.

Digitalizing creates an ‘infinite supply’ (perhaps limited only by your bandwidth) and drives costs of production to near zero (or in terms of bandwidth, rent-sharing occurs when downloaders provide the bandwidth through seeding), then the price at which individuals are willing to purchase it becomes zero. Economics says free music is the way to go, its just an ugly/frightening answer for some. I agree that free music can’t work, or at least completely free music. People talk about Pandora (which I consequently love) and Last.fm, but until a reliable wireless network can stream it to me wherever I want, then this cannot be a replacement. The best approach I have seen thus far is the EFF’s. In a nutshell, utilize the technology that is already here, utilize the systems that are already in place, and charge an amount that people are willing to pay. Society will fill its needs in whatever way necessary, even if its illegal. To avoid piracy, simply provide that same service at a reasonable price. Legalize a system, and then constrain it to fit a model. Use P2P for distribution and hosting, allow members to upload what they want, and use share ratios for ‘benefits’ or some small form of currency. Monthly fees will be paid to copyright holders based on their files’ popularity over the payment period, making it a merit based system. People may scoff or freak out, but this is the same system we have for cable television. Or internet subscriptions. Or satellite radio. Or libraries (well, mostly). It isn’t revolutionary, its a natural progression. The music industry (artists, etc) will be outsourcing its hosting efforts to its consumers, and be getting paid for it. Consumers can pick the right package for them, maybe they want infinite downloads at a higher price, or a set amount of data. There are plenty of ways to make the system work well, but no one wants to take a chance.

P2P technology isn’t running away, and neither are the music industry’s problems. Piracy is a natural approach to filling society’s unmet needs. Fill the needs with a system that cuts production costs, turns your consumers into producers and distributors, and gain back a significant market share.