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Morpheus owner StreamCast Networks has signed a deal with Sovereign
Artists 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 (Nasdaq: MSFT) 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 Distributed Computing Industry Association (DCIA), Sharman Networks' front organization. Sharman -- which owns Kazaa -- and StreamCast have had horns locked for some time. So is this what will bring on the real clash? Has StreamCast 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, DCIA CEO Marty Lafferty mentions the launch of "Jupiters Darling" and makes a point of stating, "[...] in the peer-to-peer [P2P] distribution channel, Sovereign Artists has concluded agreements with DCIA member Altnet and Streamcast Networks (Morpheus) ..." Aren't you concerned that Lafferty will turn the Sovereign/SML arrangement into an opportunity to continue to imply that StreamCast is firmly alongside the DCIA, if not actually a member.
Weiss: The DCIA will have big problems if they try to imply, infer or state that Morpheus is a member of, or supports, DCIA. StreamCast remains a committed member of P2P United. However, there are mutual interests DCIA and P2P United members do share. For example, the defeat of Orrin Hatch's Inducing Infringement of Copyrights Act [aka the INDUCE Act] and PIRATE Acts are two measures both groups are fighting against. Morpheus isn't against the DCIA, we don't believe the stated DCIA approach represents our best interests -- or those of other P2P United members. It's our belief that for all the good the DCIA is attempting 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 is confusing the issue of who represents the p2p industry. P2P United doesn't purport to represent the entire P2P industry, but it does represent the interests of the major commercial p2p file-sharing developer and distributor members that conduct business in the United States. It's misleading, at this stage, to state that any one organization represents the entire industry.
StreamCast and the other member companies of P2P United formed it to ensure that Congress hears all sides of the issues surrounding the p2p file-search-and-sharing industry and not just the side of the entertainment 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. If a 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 to develop and distribute p2p search- and file-sharing software and are on the verge of introducing the new NEOnet p2p technology to the world this year.
Newton: What about the Weed component?
Weiss: Heart has chosen to use Weed technology to promote and sell their latest album. The mechanism that allows other p2p users to become distributors and get compensated when a purchase is made is intriguing and 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 of experimenting with new business models to see what the future may hold.
In the future, StreamCast hopes to offer other alternatives to content providers, whether there is a payment component, a promotional component or both. P2p users should be able to buy music through, or by using, their favorite p2p applications, and they should also be given the option of financially supporting the artists they like. We'd like to help that along, and earn revenues while we're doing it.
The primary reason Morpheus is in the Heart promotion is to support them and their record label. It's refreshing to see a recording artist and their label looking to the p2p community instead of filing lawsuits against p2p users and/or companies. StreamCast hopes to support other content providers who reach out to the community, as well. As with any new technology, it's usually the independent companies (and artists) that first embrace it. If we can help these independents make inroads to consumers by alternative methods, since traditional methods or radio airplay and in-store promotion aren't readily available to them, then we're happy to do so. I believe very few people in the p2p community are against artists being fairly compensated for their creations, and our Heart promotion represents one way to achieve this.
Also, I think the Heart/Morpheus p2p distribution promotion
illustrates another substantial legitimate use of p2p applications and
just how valuable certain providers find p2p apps, like Morpheus, to be
for their own livelihood. The more content providers embrace p2p
companies for promotion, distribution and sales , the better it'll be for
everyone.
Newton: With Grokster, the other major p2p application, on the DCIA member list, the apparent appearance of Morpheus might lend weight to unsupported DCIA claims that it represents significant elements of the independent p2p application community. How do you feel about that?
Weiss: Morpheus is NOT a member of DCIA, does not support their platform and does not believe that DCIA represents the interests of the entire p2p industry. We continue to attempt to make this clear to lawmakers, business leaders and the public, though with the DCIA repeatedly incorrectly implying that StreamCast is a member, or that StreamCast is "working with" DCIA, we continue to need to continue to remind the outside 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 fees nor 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-peer industry 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 are falling 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 to understand their actions. I don't know if they're being told the whole story or not -- but they should take their own initiative to research fully what they are getting into. If they don't, then it's difficult to put the blame on DCIA. Marty and his DCIA staff are doing the job that they have been hired to do. Shame on other companies, if they don't conduct the proper due diligence.
P2P United was founded by major independent commercial p2p operators BearShare, Grokster, eDonkey2000 and Morpheus and is the only genuinely reresentative p2p trade and lobbying group.
Newton: One of the complaints sometimes leveled at Morpheus is that it has adware. Will you ever change that?
Weiss: Right now Morpheus earns its money by distributing two other pieces of software, as well as the actual application. It also incorporates a banner ad and three pop-up ads over a 30 minute time span. If we can continue to develop other revenue sources -- such as the sale of digital music files -- to replace them, that would be ideal.
However, unlike Altnet, StreamCast isn't attempting to develop an eCommerce platform that we'll try to force down everyone's throats as being the only method of doing business. That's at the heart of P2P United -- individual companies working together for a common cause, but still maintaining their independent business practices and strategies. We collaborate with each other or with others if it makes sense to do so, but that's totally at our option and through our own independent analysis, not because of any heavy-handed behind-the-scenes maneuvering.
We believe p2p networks (all the networks except dark-nets) do indeed represent the next distribution channel for digital media. That's an exciting proposition and I believe all the commercial companies are looking for ways to create a profitable business from this while providing users with something of value.
This is at the heart of the fights in Congress and in the courts. The incumbent entertainment industry wants to control this new distribution channel. Sharman, Altnet and Brilliant also want to control this distribution channel.
We don't want to control anything but our ability to continue to make and bring technological innovations to market such as content agnostic general communications tools. But Morpheus strives to continue to be a leading contributing participant to the evolution of media distribution.
We expect to offer solutions and if they're viable, we hope they'll succeed and perhaps be adopted by others if there are significant barriers, such as the fear of prohibitive lawsuits.
One thing is certain -- no one has a crystal ball, and it's only through
trial and error that viable solutions will be found.
