Pirates maraud on local hubs

By PETER GRIFFIN

The music industry may be facing its most serious threat yet with the rise of local peer-to-peer file-sharing hubs that allow users to illegally trade in copyrighted material without racking up expensive international data traffic charges.

Forget Grokster, KaZaA and BearShare. Keen New Zealand music downloaders can browse one another's collections on a more intimate level through "Direct Connect" hubs such as dc.p2p.net.nz.

The file-sharing hub and dozens of others play host to the usual seamy stable of peer-to-peer activity, from illicit music downloads and pirated software to pornographic movie clips and full-length Hollywood blockbusters downloadable in instalments.

New albums still riding high in the charts and released with encryption aimed at thwarting pirates are already assembled in full on the file-sharing hubs.

The works of Arthur C. Clarke and Stephen King are available in e-book format, or you can download the new Coldplay album, A Rush Of Blood To The Head, and even popular computer games such as Sim City 4.

All users require is an internet connection and client software such as DC++ that connects through the hubs to give users a view of other participants' shared-files folder.

Simply find an available download "slot", choose your song, movie or software and begin expanding your collection. It's a record industry executive's nightmare.

The set-up procedure with DC++ is slightly more complicated than with KaZaA or WinMX, but a user can be up and running in minutes.

Direct Connect has been around for a few years but has grown in popularity as hub communities worldwide reach critical mass and conventional file-sharing networks run into difficulties.

While DC++ will give access to thousands of international hubs, connecting users who collectively hold an estimated eight terabytes of content, there are huge advantages in keeping the trading local, excluding international visitors.

As community file-sharing outfit p2p.net.nz explains on its website: "If files are shared locally then downloads will be faster for end-users and [internet providers] will be able to free up international bandwidth, which can then make other services (such as web-browsing) faster."

News leaked last month from Telecom's Xtra that of its 50,000 "broadband" subscribers, 75 per cent are using Jetstream Starter, a 128 kilobit per second (Kbps) service that does not meet international standards to be classed as broadband.

Xtra and other internet providers "throttle" back download speeds to the well-known internet file-sharing networks, slowing download times.

Jetstart customers also have either 5 gigabyte (GB) or 10GB monthly download caps, but for many, national data traffic does not contribute to those caps.

That means unlimited downloading from national hubs, with no risk of exceeding their data cap and facing expensive excess bills.

The man behind p2p.net.nz is Seeby Woodhouse, the managing director of North Shore internet provider Orcon.

He said he had linked his web domain to the dc.p2p.net.nz hub after being approached by a hub owner.

"They were interested in running it without the need for a centralised server."

Woodhouse described the activity around the hub as a "vague experiment" that he "did not have much control over", but likened hub-based file-sharing to "an extension of Google", in effect a sophisticated internet search engine.

He pointed out that the hub held no shared files itself but acted as a "go-between" for individual traders to meet online.

His interest in the hub was in legitimate file-sharing.

"File-sharing has had a bad rap but there are above-board commercial opportunities," said Woodhouse.

"Unfortunately, information in the digital age has a desire to be flexible.'

He saw no moral dilemma in facilitating the file-sharing network, but accepted that there was little policing or filtering of the content traded.

"That's something I need to look at and consider," he said.

The hub is hosted on donated servers linked to "multiple 100-megabit domestic links" and located at Orcon, which blocks international traffic to the servers.

Orcon also advertises its broadband packages on dc.p2p.net.nz and supplies domestic bandwidth for the service.

Even on a slow dial-up connection, download speeds of at least 5 kilobytes a second can be achieved.

But the real file-sharing activity may take place behind closed doors. Some hubs are by invitation only and have entry-level requirements that have led them to be labelled "elitist".

Some hubs require the user to share a certain amount of content - a minimum of 30GB in some cases. This insures that only serious file-sharers join the community, helping one another to supplement already huge libraries of illicit multimedia content.

Other local hubs include dc.helix.net.nz and dc.bluewire.net.nz.

The hubs have raised the ire of the Recording Industry Association New Zealand, which sees the trading of copyrighted material online as "stealing".

"My advice to these people who think they can become mini KaZaAs and Groksters in New Zealand is that they've got a surprise coming," said association chief executive Terence O'Neill-Joyce.

His organisation would go after illegal downloaders through the courts.

"It's easier to take an action against someone in your home territory than it is to take one against someone in Chile," said O'Neill-Joyce.

In an ironic twist, the association and Phonographic Performances, which collects royalties for artists, are former customers of Orcon. O'Neill-Joyce said his group changed internet providers when it learned of Orcon's involvement with the file-sharing community.

"With all their knowledge of how the industry works, the number of times we've asked them to take things down as an internet provider, it was very disappointing."

The association has copyright law on its side, but its US equivalent has found clamping down on file-sharers to be easier said than done because of the sheer volume of offenders.

After pursuing peer-to-peer networks with limited success, the American association is going after individual file-sharers. In the past two months it has sent hundreds of letters to users threatening to sue for copyright infringement if they do not agree to out-of-court settlements.

The association's targets are understood to be large users who had distributed an average of 1000 copyrighted music files. Dozens of file-sharers have settled with payments of a few thousand dollars each.

The industry has used the power of the Digital Millennium Copyright Act to subpoena internet providers for the names and addresses of customers associated with offending hub addresses.

The American association scans the internet for ports associated with the file-sharing networks and is able to browse the collections of individual file-sharers.

As illegal sharing thrives, paid download services are gaining ground, giving music-lovers with a conscience the chance to pay for material.

Computer-maker Apple has extended its iTunes online music store to Windows users. iTunes joins a host of such services backed by the recording industry.

In Australia, Telstra will start legal music downloads in the run-up to Christmas as part of a deal with Warner Music. Pricing is yet to be revealed.

File-sharing facts

* File-sharing emerged in 1999, championed by the Napster service, which enabled people to use their computers to exchange millions of songs via the internet. Songs were then burned to CD or "ripped", which avoided having to buy the music.

* Although the American music industry shut Napster through the courts, the practice has continued through other peer-to-peer (P2P) services such as KaZaA, Lime Wire, Grokster, Blubster, BearShare, Morpheus, eDonkey and Direct Connect.

* In March, the US Senate committee exploring internet piracy was told free peer-to-peer music-file-sharing has become larger than the multibillion-dollar recording industry itself - with a growth trend that has become "fundamentally unstoppable".

* The US music industry believes file-sharing is largely responsible for a 31 per cent slump in CD sales since mid-2000, and it is pursuing file-sharing networks and individual file-sharers through the courts.

Recording Industry Association of New Zealand

Recording Industry Association of America