BitTorrent Partners with Fox, Paramount

The company behind one of the most prominent P2P file-sharing protocols is partnering with more movie studios today, in an effort to make its service commercially viable. Meanwhile, its CEO states he's not leaving the company.

Whether the movie industry is prepared to finally "embrace" P2P technology is yet to be seen, but it certainly can't ever do so if it doesn't take the first steps. Today, Paramount, 20th Century-Fox, and the MTV Networks unit of Viacom were among the list of major content producers joining Warner Bros. in backing the BitTorrent protocol, in partnerships that will apparently to the development of a new commercial service around P2P downloading.

The move comes as speculation swirls in a curious stream of bits and pieces over a possible new round of capital funding for BitTorrent. When a new venture enters "Phase III," potential backers often examine the possibility of replacing the technically gifted CEO with a financially savvy manager, moving the founders into the sometimes coveted "Chief Technology Officer" seat (for more, do a Google search on "Netscape history").

Bloggers following the BitTorrent story today speculated that similar moves may be happening there, with some going so far as to blast the headline, "Bram Cohen Leaves BitTorrent."

But in mid-afternoon, the P2P news site P2PNet received a message from BitTorrent CEO Cohen saying he is not leaving the company. "I'd like you to know that I'm still happily on board at BitTorrent, and not going anywhere," the site quotes Cohen as saying.

The message was not explicit enough to detail whether he may be transferred to another position with the company, nor did Cohen -- whose company board has no apparent chairperson -- explicitly say he was still "on the board."

BitTorrent now has the technology, the customer base, and now the support of the world's content providers. All it needs now are a business model and a plan.

"With integrated monetization for paid and ad-supported content, the forthcoming BitTorrent service will be an ideal platform for the digital distribution of online entertainment," reads the company's statement this morning. "The service will offer not only video, but also music and games."

Historically, one of the virtues of P2P protocol has been content availability, which is compounded by a decentralized catalog bringing together everything that has ever been shared. (The part about much of that content being unlicensed has been cleansed from the previous sentence.) If the new BitTorrent service were to move to a purely commercial model, the depth of content could theoretically be reduced. Immediately thereafter, the service's survival may depend on how well it withstands what may now be termed "The Napster Effect."

Another problem may be whether P2P users -- who up to now have considered themselves willing participants -- will be willing to pay to be part of the commercial distribution process, for others' content for which they won't be compensated.

As one BetaNews reader wrote last May in response to our article on the Warner Bros. partnership, "BitTorrent is a cooperative data transfer system that shares the data transmission load among users' systems. Why should I cooperate with a professional system and pay for the privilege of sharing my bandwidth to sell their downloads?"

Since BitTorrent's founding in 2001, Cohen has worked actively to promote only legal file sharing, and to actively discourage illicit and unlicensed transactions. But up to now, he has managed to accomplish this while at the same time keeping his system free of active rights management schemes. As a result, Warner Bros.' content, which became available after it announced its first major partnership with BitTorrent in May, is imbued with its own DRM. This prevents the download from being burned to DVD-R, or from being transferred to a PC other than the one that originally downloaded it.

As Paramount's, MTV's, and Fox's content comes online with BitTorrent (the official dates have not been set) they will likely also include similar schemes. But what has not yet been said is whether "the forthcoming BitTorrent service" will include its own additional preventative measures to protect against illicit file sharing. Perhaps it won't, though the company did say today that it continues to work in cooperation with the Motion Picture Association of America "to replace [infringing] content with a high quality, legal option that aspires to compete with piracy."

With availability and versatility as two of P2P's virtues being cast aside to make way for commercial viability, Bram Cohen's challenge now is to make BitTorrent commercially viable almost for its technical merits alone. If a DRM-enabled movie is available through multiple sources, BitTorrent among them, then BitTorrent must make a substantive value proposition. It will be interesting to discover what that will be.