The dark side of peer-to-peer?
Walking a more dangerous line are file-swapping services bent on supplying access to entertainment content targeted by aggressive copyright holders.
Some, such as Gnutella, are thought to be immune from legal assault because they are not backed by a corporation or other entity that can be sued. Others such as iMesh are based outside the United States, making it potentially more difficult for copyright holders to pursue infringement complaints.
Such factors have led some observers to believe that peer-to-peer technology and the file swapping it enables is essentially judgment proof, although companies that use it may not be.
"If they somehow manage to shut down Napster, they will get Gnutella, which is pretty much uncontrollable," said Tamon Marco, an investor in peer-to-peer network iMesh--an Israeli-based service with about 4 million members. Marco said he believes the service is in "full compliance with the law."
Such claims aside, sites that cater to music and other forms of content swapping can expect intense scrutiny from organizations representing content owners. Legal pressures from the Recording Industry Association of America and the Motion Picture Association of America have already contributed to the closures of several file-swapping services, including those operated by AngryCoffee, Scour and CuteMX.
Should Monday's appellate court decision in the Napster lawsuit stand, copyright enforcement looms as a significant issue for would-be file-trading sites, which might be required to expend substantial resources keeping unauthorized content off of their networks or else face liability for contributory infringement.
Still, some Napster alternatives said they are not concerned about such restrictions.
Jack Kay, chief executive of Hotline Communications, a peer-to-peer community that averages some 3 million members trading files at any given time, joined other content-trading sites in downplaying the appeals court ruling.
"I don't think Napster will affect Hotline in one way or another," he said.
The optimism expressed by Kay and Marco isn't shared by some of those who have already been targeted, however.
"If I were them, I'd shut down now," said Travis Kalanick, whose popular Scour Exchange service drew a lawsuit worth $250 billion, driving his company out of business. "If you're found to be on the wrong side (of the law), you could be sued for billions of dollars and lose. It's not worth the risk."
