Which Way for P2P: An Interview with StreamCast CEO Michael Weiss

Morpheus owner StreamCast Networks has signed a deal with SovereignArtists and SML under which tracks from the rock band Heart’s “Jupiter’s Darling” album are being offered on Morpheus in SML’s Weed format. Each track is in Microsoft’s Windows Media Audio format and comes wrapped with Microsoft’s digital-rights management (DRM) technology.

But Sovereign Artists and SML are listed as members of the DistributedComputing Industry Association (DCIA), Sharman Networks’ frontorganization. Sharman — which owns Kazaa — and StreamCast have hadhorns locked for some time. So is this what will bring on the real clash? HasStreamCast crossed into enemy territory? Are Morpheus tracks now to be”DRMd?”

StreamCast Networks CEO Michael Weiss answers these and other questions in an interview with TechNewsWorld.

Jon Newton: You’ve been one of the most outspoken opponents of Sharman,Kazaa and the DCIA, adamantly refusing to have anything to do with them.In a June 21 newsletter welcoming new member Sovereign, DCIACEO Marty Lafferty mentions the launch of “Jupiters Darling” and makes apoint of stating, “[…] in the peer-to-peer [P2P] distribution channel,Sovereign Artists has concluded agreements with DCIA member Altnet andStreamcast Networks (Morpheus) …” Aren’t you concerned that Laffertywill turn the Sovereign/SML arrangement into an opportunity tocontinue to imply that StreamCast is firmly alongside the DCIA, if notactually a member.

Weiss: The DCIA will have big problems if they try to imply, infer orstate that Morpheus is a member of, or supports, DCIA. StreamCast remainsa committed member of P2P United. However, there are mutual interestsDCIA and P2P United members do share. For example, the defeat of OrrinHatch’s Inducing Infringement of Copyrights Act [aka theINDUCE Act] and PIRATE Acts are two measures both groups are fightingagainst. Morpheus isn’t against the DCIA, we don’t believe the statedDCIA approach represents our best interests — or those of other P2PUnited members. It’s our belief that for all the good the DCIA isattempting to do, the fact that their financial backers are Sharman,Altnet and Brilliant will always take away from their efforts.

And we think that in many instances, intentional or not, DCIA isconfusing the issue of who represents the p2p industry. P2P Uniteddoesn’t purport to represent the entire P2P industry, but it doesrepresent the interests of the major commercial p2p file-sharingdeveloper and distributor members that conduct business in the UnitedStates. It’s misleading, at this stage, to state that any oneorganization represents the entire industry.

StreamCast and the other member companies of P2P United formed it toensure that Congress hears all sides of the issues surrounding the p2pfile-search-and-sharing industry and not just the side of theentertainment industries or that of Sharman Networks.

Newton: Each Heart track has Microsoft’s DRM. Does that mean you’re getting into DRM, or that Morpheus files will suddenly be copy protected, as the entertainment industry likes to call it?

Weiss: P2p technology is content neutral; it supports all file types. Ifa file is DRM-wrapped to start with, it stays that way. If it isn’t,then it’s DRM-free. Morpheus isn’t in the DRM business. We’re here todevelop and distribute p2p search- and file-sharing software and are onthe verge of introducing the new NEOnet p2p technology to the world thisyear.

Newton: What about the Weed component?

Weiss: Heart has chosen to use Weed technology to promote and sell theirlatest album. The mechanism that allows other p2p users to becomedistributors and get compensated when a purchase is made is intriguingand I think it’s worthwhile to see how the users react to such a plan.Just like in technology development, one should never be afraid ofexperimenting with new business models to see what the future may hold.

In the future, StreamCast hopes to offer other alternatives to contentproviders, whether there is a payment component, a promotional componentor both. P2p users should be able to buy music through, or by using,their favorite p2p applications, and they should also be given theoption of financially supporting the artists they like. We’d like tohelp that along, and earn revenues while we’re doing it.

The primary reason Morpheus is in the Heart promotion is to support themand their record label. It’s refreshing to see a recording artist andtheir label looking to the p2p community instead of filing lawsuitsagainst p2p users and/or companies. StreamCast hopes to support othercontent providers who reach out to the community, as well. As with anynew technology, it’s usually the independent companies (and artists)that first embrace it. If we can help these independents make inroads toconsumers by alternative methods, since traditional methods or radioairplay and in-store promotion aren’t readily available to them, thenwe’re happy to do so. I believe very few people in the p2p community areagainst artists being fairly compensated for their creations, and ourHeart promotion represents one way to achieve this.

Also, I think the Heart/Morpheus p2p distribution promotionillustrates another substantial legitimate use of p2p applications andjust how valuable certain providers find p2p apps, like Morpheus, to befor their own livelihood. The more content providers embrace p2pcompanies for promotion, distribution and sales, the better it’ll be foreveryone.

Newton: With Grokster, the other major p2p application, on the DCIA member list, the apparent appearance of Morpheus might lend weight tounsupported DCIA claims that it represents significant elements of theindependent p2p application community. How do you feel about that?

Weiss: Morpheus is NOT a member of DCIA, does not support their platformand does not believe that DCIA represents the interests of the entirep2p industry. We continue to attempt to make this clear to lawmakers,business leaders and the public, though with the DCIA repeatedlyincorrectly implying that StreamCast is a member, or that StreamCast is”working with” DCIA, we continue to need to continue to remind theoutside world of the reality.

Newton: I understand that companies the DCIA has been able to persuade to use one or more services or technologies pay neither membership feesnor dues, but nonetheless show up as “members” as part of the package.This “members” list enables the DCIA to present itself as a peer-to-peerindustry trade group. But with the exception of Sharman associates,Brilliant Digital Entertainment and Altnet, none of the member companies have a presence on the p2p scene. In fact, I’ve been told some member companies are already having regrets. What’s your take on this?

Weiss: Yes, this is a problem that unsuspecting “members” of DCIA arefalling into. They don’t understand the background or history of DCIA.This isn’t to say that DCIA is all bad, but these companies need tounderstand their actions. I don’t know if they’re being told the wholestory or not — but they should take their own initiative to researchfully what they are getting into. If they don’t, then it’s difficult toput the blame on DCIA. Marty and his DCIA staff are doing the job thatthey have been hired to do. Shame on other companies, if they don’tconduct the proper due diligence.

P2P United was founded by major independent commercial p2p operatorsBearShare, Grokster, eDonkey2000 and Morpheus and is the onlygenuinely reresentative p2p trade and lobbying group.

Newton: One of the complaints sometimes leveled at Morpheus is that ithas adware. Will you ever change that?

Weiss: Right now Morpheus earns its money by distributing two otherpieces of software, as well as the actual application. It alsoincorporates a banner ad and three pop-up ads over a 30 minute timespan. If we can continue to develop other revenue sources — such as thesale of digital music files — to replace them, that would be ideal.

However, unlike Altnet, StreamCast isn’t attempting to develop aneCommerce platform that we’ll try to force down everyone’s throats asbeing the only method of doing business. That’s at the heart of P2PUnited — individual companies working together for a common cause, butstill maintaining their independent business practices and strategies.We collaborate with each other or with others if it makes sense to doso, but that’s totally at our option and through our own independentanalysis, not because of any heavy-handed behind-the-scenes maneuvering.

We believe p2p networks (all the networks except dark-nets) do indeedrepresent the next distribution channel for digital media. That’s anexciting proposition and I believe all the commercial companies arelooking for ways to create a profitable business from this whileproviding users with something of value.

This is at the heart of the fights in Congress and in the courts. Theincumbent entertainment industry wants to control this new distributionchannel. Sharman, Altnet and Brilliant also want to control thisdistribution channel.

We don’t want to control anything but our ability to continue to makeand bring technological innovations to market such as content agnosticgeneral communications tools. But Morpheus strives to continue to be aleading contributing participant to the evolution of media distribution.

We expect to offer solutions and if they’re viable, we hope they’llsucceed and perhaps be adopted by others if there are significantbarriers, such as the fear of prohibitive lawsuits.

One thing is certain — no one has a crystal ball, and it’s only throughtrial and error that viable solutions will be found.

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