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File Sharing - Wednesday, September 28, 2005

eDonkey & BitTorrent - A Tale of Two Lawyers

The past couple of weeks have seen dramatic changes in the file sharing business. BitTorrent received VC funding and moved to San Francisco. Meanwhile a company that has surpassed BitTorrent's popularity, eDonkey, was forced to close its New York office and flee for parts unknown. Another company, WinMX Shuttered itself, and after losing a legal battle with the RIAA, Grokster got an offer from Mashboxx. Today came news that Congress, led by California Senator Diane Feinstein might create a law that is even more aggressive with P2P companies.

It will be interesting to see who was more law-savvy in the end - eDonkey which will probably surface in Gibraltar or some other haven but will have trouble raising capital -- or BitTorrent, which has funding but reamins in the open light and will be at the mercy of legislators and Hollywood copyright freaks.

We also note a rare public slap by one VC to others - this in Businessweek: "I don't think the major media companies are ready to embrace P2P," says George Zachary, a partner at Charles River Ventures. "I could have invested and I didn't."

Read - WinMX Shuts Down After RIAA Threat (BetaNews)
Read - Congress to legislate file swapping? (CNET)
Read - BitTorrent's Grab at Respectability (BusinessWeek)