BitTorrent to Open Video Store

One of the best-known names in peer-to-peer (P2P) file sharing, BitTorrent , plans to take a more active and profitable role in Internet video distribution by opening its own retail site, Light Reading has learned.

BitTorrent will enter a growing Internet video business, a phenomenon happening concurrently with the telcos' rollout of IPTV service. (See Content Deals May Swing IPTV Acceptance.) Some observers believe Internet video could remove some of the upside from the telcos' IPTV business case. (See IPTV Not Yet Killer App and AT&T, Verizon Tout Telco TV .)

Since 2001, BitTorrent has distributed its peer-to-peer technology to millions of file sharers at no cost. The company only last year became a corporation, and now plans to leverage its brand name to sell licensed video content on its own retail site. (See AOL Goes P2P for Video.)

BitTorrent spokeswoman Lily Lin tells Light Reading her company is now in licensing negotiations with several content owners.

"We want to aggregate video and other content and make it available in a legal and sanctioned area," says BitTorrent co-founder and president Ashwin Navin.

The company, however, is vague on the types of video content it plans to sell. "It's going to run the gamut because we don’t have limited shelf space," Navin says.

Because its new business will depend heavily on the trust of content owners, BitTorrent has been playing nice with Hollywood. In a show of good faith, BitTorrent promised the Motion Picture Association of America (MPAA) last year that it would remove copyright protected content from its P2P search engine results.

Navin says BitTorrent's efforts with content owners have not suffered from P2P's somewhat dubious past. "There is a huge emphasis, especially post-Grokster, on intent, and in every situation we’ve encountered people understand our intent to be friendly to content owners." (See Grokster Shuts Down.)

BitTorrent is making the case to content owners that a friendly relationship might help everyone get paid. “The MPAA tells us that 650,000 movies are being downloaded every year, and nobody’s getting paid,” Lin says. “We see P2P being utilized so that the publisher, the artist and the ISPs all get paid for the content.”

Language like that sounds like it's straight out of the MPAA PR playbook. Is BitTorrent going to the dark side, selling out?

What we do know is that BitTorrent's flavor of P2P works and people like it. A source close to BitTorrent makes the point that many P2P file sharers have kids and jobs and backyards and would rather not do anything illegal. Those users, the source says, are likely to eschew legally dubious file sharing sites in favor of BitTorrent's paid video service.

BitTorrent delivers video files using a method known as "swarming." Small pieces of the file are gathered from the PCs of users who already have the content, then quickly reassembled on the downloader's PC. Swarming is far faster than a linear download from a central server somewhere.

The popularity of P2P coupled with the large file sizes have placed a heavy burden on ISPs. (See P2P Fuels Global Bandwidth Binge.) BitTorrent and other P2P files account for as much as 60 percent of the bandwidth used by ISP customers. (See Nareos Monitors P2P.)

"The ISPs are already dealing with a lot of peer-to-peer traffic, so consumers clearly want audio and video,” BitTorrent's Lin says. (See QOS Fees Could Change Everything .)

The San Francisco-based company also wants to help ISPs build their own video stores. BitTorrent will participate in a P2P video trial with the British cable ISP ntl group ltd. (Nasdaq: NTLI) starting in April. Under the terms, BitTorrent will aggregate the video content and provide ntl with the P2P distribution platform. (See NTL Teams on P2P Trial.)

— Mark Sullivan, Reporter, Light Reading