Although AllPeers didn’t produce the kind of outcome that we had hoped for and expected, it’s been a tremendous learning experience. Hopefully others will be able to benefit from what I consider to be the main lessons.
Luck and ambition
Naturally the success of any startup is dependent to some degree on luck, and the luck factor rises in proportion to your ambitions. If your plan is to sell T-shirts online then execution is probably the main consideration. If you make really cool designs, have an easy-to-use website and do good marketing then you’ll probably make money, though you’re unlikely to be buying a private island in the South Pacific any time soon. If, on the other hand, you plan to dethrone Facebook by adding state-of-the-art social features to the fabric of the web, transforming the internet experience of billions of people, you’re going to have to execute to perfection and still get really really lucky if your company is to succeed. Of course, if you make it you’ll be assured a very comfortable early retirement.
Neither of these approaches is inherently wrong but you should be aware of what you’re getting yourself into. If you can’t stand the thought of failure, make sure you’re not tackling a problem that is too big and ambitious. In the case of AllPeers, we knew that there was going to be a lot of luck involved (as there is with any product that relies on network effects and viral adoption), and we were pretty well prepared for the challenges we would face. It is comforting to see failure in this way because we certainly wouldn’t have sacrificed our lofty ambitions to increase our chance of moderate success.
Raise as much as you can
I’m not the first one to say this, but let me express my wholehearted agreement: raise as much as you can, as soon as you can, and not a penny less. In early 2006, before we had released even a private alpha of AllPeers, we suddenly became a minor web star thanks to a couple of white-hot buzzwords (”Firefox” and “BitTorrent”) and a very positive writeup on TechCrunch. (And in fact we owe a great deal to Mike Arrington, who grasped our vision immediately and did a great job of articulating why it was exciting. It’s easy and intellectually lazy to be pessimistic before the fact and snarky afterwards, while it takes courage to go out on a limb and predict success.) We believed our own hype a bit too much, unfortunately, and didn’t take advantage of the opportunity to raise a lot of cash at a high valuation. Instead we brought in a very modest amount under the assumption that we’d be in a great position in a few short months to close a much bigger round.
As a result, we were under constant pressure to get user numbers up so we could raise more money. This isn’t the way to run a company, particularly one with an ambitious technological vision. We ended up making a string of tactical moves rather than taking a step back and looking at the big picture. As a consequence, we ran out of money before we could get the product to where it needed to be. Don’t make this mistake.
This shouldn’t be construed as a criticism of Mangrove Capital Partners, who led our series A investment round. They are a fantastic group of individuals whom I wouldn’t hesitate to recommend to any entrepreneur seeking funding, and a classic example of a VC who really does offer much more than money to a budding startup (something they all claim to do). But only a company’s founder has a single-minded focus on the company’s success, and this includes acquiring a war chest to deal with unforeseen contingencies.
TorrentFreak is running an interview with me about our Social BitTorrent functionality, present and future.
With the Great Skype Outage heading into its second day with no clear end in sight, pundits like Om Malik are wondering aloud whether the very idea of P2P architectures is flawed:
Folks at Joost, Babelgum and other P2P companies should be concerned about their business prospects going forward. Venture capitalists who have been funding P2P-based services should take this as an early warning on the fragility of the whole P2P ecosystem, where a small glitch can cause widespread problems.
To be fair, Om has since backpedaled on this. (Side note: if an AllPeers rep every says “We love our customers too much to let that happen,” please put them out of their misery.) The actual P2P parts, if correctly implemented, are incredibly robust. By avoiding centralized points of failure, the system can continue running even if large swaths of it go offline. However, some things are much, much easier to implement with a central server. Skype’s registration server, for example, is a centralized service that keeps track of who is registered, what contacts they have, basic profile information and the like (at AllPeers we do the same). I’m not sure how their name resolution works, but you need a way to find out the IP address of a given node (e.g. your buddy Bob) and that’s much easier to accomplish with a server as well.
Basically your network has a P2P part which, for all intents and purposes, can never go down, and a centralized part which is subject to all the same scalability and availability considerations as any pure client/server solution.
So could Skype (or any P2P network) replace its centralized infrastructure with P2P technology that makes downtime a thing of the past? For someone like Skype, who already has a huge and fairly stable P2P overlay network, the answer is probably yes. I would keep the centralized servers but mirror the registration and name resolution data on a Distributed Hash Table. In essence, you figure out which Skype nodes are up most reliably (there must be thousands of people whose Skype uptime is near 100%) and use them to hold a mirror to the data on the servers. The servers would be there to make sure that data isn’t lost if someone goes offline unexpectedly, but otherwise the DHT would be used and no one would even notice if the centralized boxes went down for some time period.
As it transpires, Om’s second article quotes Skype as saying the problem is actually a result of an error in their networking code. The real question is thus whether EBay is an effective steward of what was for a long time a true technical marvel: incredibly reliable, fast, simple and easy to use. Judging from recent Skype releases, I’m not that optimistic.
UPDATE: The New York Times has more details about what caused the outage. If the problem has existed in the software since 2003 then maybe I was a bit harsh on EBay.
3 weeks ago, we met Robert Scoble for a little chat about AllPeers and what’s coming next. So if you want to see Matt, me, Scoble’s hand and a couple of Nokia N95 click play below.
Sasa, our genius graphic designer, has created a few banners based on the same designs we have used for the highly fashionable AllPeers tee-shirts (look for them on Matt and me at Supernova this week!).
If you have a blog or a profile or a homepage and you would like to tell your visitors about AllPeers, feel free to cut and paste the HTML code next to your favorite design.
|
|
File Sharing for the Masses
|
|
|
Dont stop sharing!
|
|
|
Share Different!
|
|
|
Weapon of Mass Distribution
|
|
|
Weapon of Mass Distribution
|
The follow is a translation of an article from the French website Ratiatum that deserves to be read by the English-speaking among us.
In a ridiculous and grotesque judicial move, made possible by the DADVSI law passed by the UMP government and, above all, by the Vivendi amendment supported by Nicolas Sarkozy, the SPPF, which represents independent labels in France, is suing three P2P software vendors.
And so it begins! The Vivendi amendment, hotly contested when it was debated in parliament and passed by a whisker by the Joint Committee of the National Assembly and the Senate, has been put to the test by French music labels. They have filed suit against three software vendors: Morpheus, Azureus and Shareaza. It has to be said that they would have been wrong not to take advantage of this gift given to them by the De Villepin government and Donnedieu de Vabres, a government minister, a gift that was carefully wrapped, so to speak, by then Minister of the Interior and UMP president Nicolas Sarkozy.
The amendment, requested by the eponymous French conglomerate, punishes by three years in prison and a fine of 300,000 euros the publishing of “software manifestly designed for illicit use.” Never mind its lack of precision and the insecurity that it subjects software vendors to. Its application in civil law forces publishers of file-sharing software to put in place measures to prevent the downloading of illicit content. It is on this basis that the Société des Producteurs de Phonogrammes en France (Society of Phonogram Producers in France) filed suit against three software vendors. They hope to win the right to have the case judged in France and are asking for 20.3 million euros in damages and interest.
The choice of the three applications being targeted is interesting:
- Morpheus is a sitting duck that it is just too easy to take pot shots at. Already found guilty in the United States, it is itself seeking 4 billion dollars from eBay but no longer boasts a single user.
- Azureus is one of the rare open source programs to have dared to dip its toe in the waters of commerce by providing content publishers with a source of revenues. The publisher of the BitTorrent client has created a VOD platform, Zudeo (now Vuze), in the United States.
- Shareaza is an open source multi-platform application that has never had commercial ambitions, has never displayed any advertising and has therefore never earned a single euro of revenue. It is essentially the work of a lone developer. Even today, no ads can be seen on the official website nor in the software itself. It is nonetheless one of the most popular clients for downloading legal content from the Ratiatum download channel.
I woke up this morning to find out the announcement of 2 new features: MeeboRooms on Meebo and full-screen streaming TV on vpod.
Both features are great add-ons to these sites. I really like what Rodrigo, Ivan and their team are doing with vpod. Their premium video player is sleek and clean and the loading time extremely fast. Of course, as YouTube & Co know very well, the Achille heel of such services is the pressure success can put on the backend infrastructure and the associated costs. This is one of the reasons why we, at AllPeers, believe distributed content over a P2P network is the only long-term viable solution for such businesses if they want to control their costs efficiently. This is no trivial task and a lot of innovations is still required both at the network architecture level and the consumer equipments level but there is no doubt, at least for me, the YouTubes of the future will contain some form of distributing computing (beyond the browser as we know it today).
Chat rooms are a great addition to existing online properties and sure enough the move from Meebo is a great one. There again, the centralized nature of such a service is its Achille heel (why would they limit to 80 participants if they did not have backend limitations?) but this is not the most important issue. Just like AOL discovered in its early days, the problem in public chat rooms is not the technology. It’s the people or more precisely the abuse people can inflict to each other thanks to the “anonymity” of the web. Sure enough, NewTeeVee had to disable their Meebo public room after 2 and a half hours because “the moderation had become too intensive”. If you are going to run public chat rooms be prepared for your 2 worst enemies: Abusive users and SpamBot. The best protection against these pests are moderators and SpamBot Removers. If you are lucky enough to have a thriving community you can rely on volunteers. You will need to hire a community moderator manager who will have to play the bad/good cop all day dealing with complaints of moderators abusing their “power”. The alternative is of course to pay for professional moderators but in both case do not think that introducing public chat rooms is only a matter of throwing a few lines of HTML into a webpage.
Anyway, I sound like an old whiner and that’s not the goal. Good luck to these new services!
 Thank you PCWorld for making AllPeers the winner of the File-Sharing category of its “101 Fantastic Freebies” in front of Pando and uTorrent.
PC World editors tested and evaluated hundreds of downloads and services before narrowing it down to the top 101, with a designated “winner” in each of 23 categories from desktop search tools to video sites. Each service or program had to meet certain criteria in terms of design, usefulness, functionality, and of course, they all had to be free.
Slyck, a popular P2P blog, is running a real hatchet job about AllPeers, so I wanted to respond and clarify the points raised by the article.
First and perhaps most importantly, AllPeers is not designed to be used for “darknet” applications nor have we ever made this claim. In fact, our terms and conditions clearly state that exchange of copyrighted materials is not permitted when using our software. So it’s natural that people who formed that expectation are going to be disappointed. AllPeers is intended for private groups of friends and family to share their personal media (photos, videos, PowerPoint presentations, etc.). We’ve invested all our efforts into making it a great application for this purpose, and the feedback we’ve received when it is judged on this basis has been very positive.
The article’s author obviously set out to find as many pernicious lies and misrepresentations as possible that we are alleged to have made, which is unfortunate. I would have preferred to see a much more balanced approach. A lot of the claims are just silly, some are rather harsh criticisms of software that is still in an early beta stage, while others are most probably the result of simple misunderstandings (which arise more easily when you concentrate explicitly on finding as many things as possible to “expose” about our dishonest ways). I’ll address the points one by one.
It’s true that when you install AllPeers, you’re prompted to register and that this registration screen reappears when Firefox is restarted if you haven’t already filled out the form. This is basically an oversight on our part since we haven’t received many (any?) complaints about this until now. People tend either to register or uninstall. But I agree with the author that this is too obstrusive. This is, after all, exactly the type of issue that the beta phase is intended to reveal. We’ll change it in future versions.
We’ve said many times that we are planning to open source the software but that we have not yet done so. If the author had looked a bit harder for information about this instead of trying to hunt down our source code (which would obviously be displayed prominently if we were open source), he could have established this fact quite easily. We want to get much further with our beta testing before we start worrying about all the additional work associated with setting up a proper open source community.
I have to confess that I don’t understand the uploading issue. I’m not sure that we were particularly unclear, but to be safe: what we mean by this is that, unlike centralized file hosting sites, you don’t have to wait to upload all your files when you want to share them. Instead, they are shared using a P2P network. I think perhaps the author honed in on one specific use case, which is when you share a file from the web. In order to ensure that the file is available when the recipient wants to download it, we store a local copy. I’m not sure, however, what (if anything) this has to do with uploading.
I guess the article is simply commenting on our investment, not criticizing it, although the tone is as negative as the rest of the story. We have a great business model that we will be implementing in future versions, but for strategic reasons we don’t want to be specific about this now. Stay tuned and all will be revealed in good time.
Three letters: P2P.
Ehm, two letters and a number, actually. Whatever.
The first edition of Pressure Point is an interview with one of our investors, Mark Tluszcz of Mangrove Capital Partners. He touches on the state of VC investment in Europe, the influence of Skype’s successful exit on European technology companies, VC attitudes towards open source, telco consolidation and P2P, and many other topics.
 It used to be a running joke of mine that every VC you meet tells you that the most important thing to them when considering a potential investment is the “team”. This is only funny because it’s so obvious, and yet everyone says it as if they have discovered a brilliant new investment strategy, destined to vault them ahead of the competition.
At the risk of being equally trite, I would like to point out that the very same consideration exists in the other direction. Of course, as an entrepreneur you sometimes find yourself in a position where you have to take whatever money is offered to you. But dollars handed over in a black leather Samsonite briefcase by a 220 pound guy called Igor in a dimly lit parking garage outside of Minsk are not the same as those obtained from a reputable investor. In the same way, not every VC fund is created equal or will be able to offer the same value to any given startup. I hope that in listening to Mark, you will see why we found Mangrove to be such a great fit for AllPeers: they’re thoughtful, visionary, articulate folks… just like us!
Download the podcast (high quality, 25 Mb) (low quality, 6 Mb)
Update: I was assuming that most people would want to download the file, put it in their MP3 player and listen to it over and over again for at least a few days. But I’ve already gotten a few complaints about the download size, so if you want to listen to it in streaming mode, here’s a player:
Hifi streaming (128 Kb/s):
Lofi streaming (32 Kb/s)
Update: Okay, okay, I put up a low fidelity version that’s only a quarter of the size.
Update: Am I the nicest guy or what? I’ve put up lofi streaming as well.
About a year ago I had a heated debate with the head of one of the most technically advanced company in the online adult market. I was intellectually interested in this market since the adult industry has always been a test bed for new technologies. We were of course talking about how Peer-to-Peer was the most efficient way to distribute video content and how he could start selling some of his productions for 10$ per file instead of 60$ per DVD.
However, our views diverged very quickly on 2 issues: DRM and device. His goal in life was to ship a set-top box that would connect to a Peer-to-Peer network full of movies loaded with heavy DRM (”to stop the hacker kids from stealing my content”).
I fully disagreed (and still do) with his views. First, his hacker kids can’t afford his $60 movies so he is not losing revenue if they hack it and no DRM is unhackable anyway. So instead of giving freedom to his genuine consumers (who actually might have no ideas on how to get hold of the movies for free), he was prepared to put heavy restrictions on them to protect revenue he would have not booked anyway.
What really got me going was his set-top box vision. He wanted to own the box and that every single consumer of his files would buy the box (yes buy!) and subscribe to various channels where they could buy movies from various producers: “The Ultimate Adult Entertainment Box”. At a time when Personal Computers are turning into media centric devices, why on earth would someone want to add another box in their living room and learn new propriatery software?
We never managed to agree on the above issues and we agreed to stay in touch. He did however give me a couple of sample productions to help me research more about the issues his industry is faced with. I have to say if I were him, I would not spend time and money on DRMising this content. I had seen it all before.
This was one year ago. He still has not launched his DRMed box but more recently I heard of at least two major media companies basing their video distribution strategy on a set top box.
Time to start a new business: Rack-a-Box; the shelves for set-top boxes company.
Build your own rack of boxes for your living-room. Comes in brushed aluminium or wood imitation for your cosy interior. Fully extensible and adjustable. Works for TiVo, VCR, DVD Players, Cable, Video-On-Demand, Games Consoles, Satellite, Adult Boxes and many more! Wanna watch the last blockbuster but don’t have the box from the right company? Just call us. We’ll bring you the shelves extension and the box together. Free basket for remote controls included for any new customer until stock lasts. Only $9.99 per empty shelf.
Our sysadmin Greg, who is French, sent us an article from Le Monde in a mail entitled “AllPeers illégal en France ?” Later in the day, Daniel Glazman gave me a heads up about the same issue. The article brings us the latest and greatest from the French National Assembly’s debate on revisions to their copyright law. I should probably be following this more closely since the action is apparently intense, in that “chaque article, chaque amendement a donné lieu à de longs débats sous l’oeil des internautes et des auteurs” (”every article and every amendment has given rise to long debates under close scrutiny from copyright holders and internet users”).
The article goes on to explain that “le fait d’éditer et de mettre ’sciemment’ à disposition du public un logiciel permettant le téléchargement illégal ‘d’œuvres ou d’objets protégés’ est passible de trois ans d’emprisonnement et 300 000 d’euros d’amende” (”publishing and ‘knowingly’ making available to the public software that enables the illegal downloading of ‘protected works or objects’ is punishable by three years imprisonment and a fine of 300,000 euros”).
My reaction was predictably sanguine. I still don’t believe that anything we’re doing could be construed as illegal. Legislation of this type, in the same way as recent American judicial decisions, is clearly intended to sanction software that is explicitly designed to assist in the illegal transfer of copyrighted works. In fact, the discussion of the amendment in question actually makes reference to MGM vs. Grokster:
Le 27 juin 2005, dans un litige qui opposait les éditeurs de logiciels de peer-to-peer Grokster et StreamCast aux studios Metro-Godwyn-Mayer (MGM), les neuf juges de la Cour suprême des Etats-Unis ont reconnu à l’unanimité la responsabilité de Grokster et Streamcast pour trois motifs : ils encourageaient les utilisateurs à violer le droit d’auteur, n’avaient pas mis en place de dispositif destiné à réduire la réalisation d’actes de contrefaçon, et tiraient un avantage financier de ces contrefaçons.
(”On June 27, 2005, in a case that pitted the vendors of P2P software Grokster and Streamcast against MGM studios, the nine judges of the Supreme Court unanimously recognized the culpability of Grokster and Streamcast for three reasons: they encouraged users to violate copyrights, they did not put into place mechanisms designed to reduce the prevalence of acts of copyright violation and they profited financially from these acts.”)
Needless to say, none of these three points applies to AllPeers.
It’s worth mention that Tristan Nitot, president of Mozilla Europe, has been doing an outstanding job chronicling this drama as it unfolds, and he’s apoplectic about the latest developments. I don’t think either of us needs to worry about incarceration just yet. This isn’t to say that the insanely broad and ambiguous wording of the law is a good thing, but sometimes this can constitute a protection in and of itself. They will never be allowed to apply the law broadly since the consequences would be so manifestly absurd.
That said, let me say just in case that, for any Peer Pressure reader who might want to visit me in French jail: I really prefer pains au chocolat, but I could make do with a chausson aux pommes in a pinch.
Om Malik’s guest columnist Robert Young in his piece entitled “Can MySpace be Beaten” (yes they can), says:
It’s safe to say that MySpace has essentially captured the entirety of Americas youth. Moreover, these kids have created their own unique MySpace profile pages that are, in turn, rapidly becoming their personalized dashboards to everything that is important to them in their daily lives. Currently, that includes social networks of their online friends, venues to communicate with them, and collections of their favorite music & videos.
But as they mature, and their hunger for new types of information, media, and social connections expand, they will want their dashboards to grow and morph with them, each personalized with only the items that they are individually interested in. At the end of the day, services like MySpace have the rare opportunity to become the ultimate console for consumer control (C3)
I fully agree with this even though the name “console for consumer control” is a bit of a mouthful. We also strongly believe the browser is the best candidate for this console as described by Matt but more importantly that the user’s machine is the best place to store this extensible online identity and the data attached to it.
This ultimately gives users more freedom but also more control over their online representation allowing the same individual to represent himself differently depending on the person looking. Are you a close friend of mine then I’ll share intimate information and a maximum of data with you. Are you a complete stranger then you’ll only have access to my most generic blog entries.
One of the most frequent comments I’ve seen in the past few days regarding AllPeers concerns the potential for legal problems because of the peer-to-peer nature of the software. A few people have gone as far as to suggest that the Mozilla Foundation itself might suffer from the existence of a P2P extension to the Firefox browser. These views, though certainly understandable, are based on fundamental misconceptions about the P2P landscape.
First of all, there are many types of P2P software that allow the transfer of media files between machines. The most obvious are instant messaging clients, which increasingly enable users to send files directly without passing through a server (Skype was a trailblazer in this respect). I’ve never seen anyone suggest that this software is a potential target for legal action, and with good reason. P2P itself is basic enabling technology without which the internet would be very much poorer.
More recently, the United States Supreme Court ruled in MGM vs. Grokster that a company cannot be held accountable for potential copyright infringement committed by its users, upholding the earlier Betamax Decision (which otherwise would have resulted in the banning of the VCR, to the media industry’s great detriment). They did rule that a company can be sued for “actively inducing” its users to infringe on others’ copyrights. This is a vital distinction, as a number of companies based their business model directly on profiting from the illegal copying of commercial media files. While I don’t agree with the way that media companies have thus far reacted to the digital revolution, I think it is reprehensible for a company to try to make money in this way, so I support the Grokster decision wholeheartedly. We don’t and never will base our business model on encouraging copyright infringement on the part of our users. In fact, we hope in the future to contribute actively to developing innovative new ways for consumers to acquire digital content legally, and at a fair price, without succumbing to the oppressive restrictions inherent in today’s DRM technology.
|
|
|
