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Confusion, tech issues delay legit file-sharing sites

By Jefferson Graham, USA TODAY Tue Sep 20, 7:56 AM ET

Getting legitimate online music and video file-sharing programs off the ground is taking a lot longer than originally promised.

At the beginning of the year, two tiny ventures, Mashboxx and Snocap, said they had come up with services that could turn unauthorized downloads into legitimate transactions. IMesh, one of the first digital file-sharing companies, said it would launch an authorized service this year, but no date has been revealed.

They all have been hampered by technical delays and confusion over copyright rulings that seek to curb the wildly popular practice of swapping music and videos online without paying for them.

In June, the Supreme Court ruled that file-sharing service
Grokster and StreamCast Networks, which operates the Morpheus service, could be held liable for their users' actions. The overall size of the song-and-movie swapping audience has grown since the court decision, while fledging legitimate services have scrambled to become as attractive as mainstream online music stores such as Apple's iTunes, Rhapsody and the new
Napster.

On Monday, a source with direct knowledge of the matter, said Grokster - which was sued by the
Recording Industry Association of America - is in settlement talks with the music labels.

Mashboxx, in turn, has acquired Grokster's assets, pending the resolution of the settlement, according to the same source, who declined to speak for attribution because settlement talks are still fluid.

Mashboxx and iMesh say their offerings will feel more like the so-called peer-to-peer services - with bigger catalogs and looser rules than current online music stores.

"We have a system where rights holders can lay claim to their content," says Wayne Rosso, chairman of Mashboxx. "Nobody else has anything like that."

Mashboxx is working with Snocap, run by Napster founder Shawn Fanning, to use its system of digital fingerprinting to track songs.

Rosso insists Mashboxx will be up and running by the end of the year, despite all the delays.

But Eric Garland, CEO of Internet measurement firm BigChampagne, says the terms of the "P2P killers" will have to be as loose as those on unauthorized services such as Kazaa before users will switch.

To be successful, the new crop of services must offer songs that are playable on Apple's iPod, be affordable and have strong music catalogs, he says.

Current music stores have different usage rules - songs purchased at Yahoo Music and Wal-Mart, for instance, won't play on the iPod without a workaround, while songs purchased at iTunes won't play easily on non-iPod devices.

"If consumers feel it meets the standard of P2P, they'll be willing to try it," Garland says. "Otherwise, they won't care."

Apple has the most successful online music store, selling more than 500 million songs in two years. But Garland notes that more than 1 billion songs are offered for download on the unauthorized services every month.

This makes me laugh. Legit file sharing has been around for a couple of years now thanks to BitTorrent and trackers like EzTree/DAD, ETree, Sidewalk Crusaders, etc. Even when they finally get these things running, I still won't have a need to touch them.

but isn't etree and sites like that for live shows? i thought this was more about studio stuff.

This is true, but you can get it for free, as opposed to either paying money or pirating.

i keep hearing people say that the music industry is headed in the direction of online things. is that necessarily true or do they see people getting it for free online and they want to take advantage of it and make some money? there are still plenty of people out there, like myself, who still purchase cds.

Illegal file sharing won't stop because people have realized they can preview a CD and only buy the good stuff. You never have to make a crappy purchase anymore, and that's great. Hopefully it'll force the recording industry to put out better music, because that's the only way that people with discerning taste will purchase anything anymore.