BitTorrent targets downloads market

BitTorrent, a startup based on the popular download technology of the same name, will today launch the latest challenge to Apple, Wal-Mart and other companies seeking to corner the market for film downloads.

The BitTorrent Entertainment Network will offer downloads of films and television shows from studios including MGM, Paramount and Fox.

Its launch follows the unveiling of Joost, a software video project set up by the founders of Skype, the VoIP telephone company, which has also struck content deals with big media groups.

BitTorrent’s download technology, which takes advantage of a network of users interested in the same file to increase download speeds, could give the site
an advantage over its rivals by reducing customers’ download times, according to Rob Enderle, an analyst with Enderle Research Group.

“This is one of those things that could be a game-changer,” said Mr Enderle.

The launch of a legitimate online store marks a turning point for the technology that powers the site. Other sites that use the open-source file transfer technology have long accounted for a substantial percentage of illegal peer-to-peer download traffic.

Ashwin Navin, BitTorrent’s co-founder and president, said the company, which has attracted $30m in venture capital funding since it was founded in 2004, hoped to take advantage of the technology’s reputation while at the same time offering a system that would guarantee the rights of content owners.

Unlike illegal sites that use BitTorrent to distribute pirated files, the company’s variant of the BitTorrent software includes a digital rights management system that prevents users from copying or sharing files.

Michael McGuire, an analyst at Gartner, said film studios’ rush to embrace BitTorrent, Joost and other startup video services reflected lessons learned from the painful experiences of music companies, who failed to embrace digitual distribution models until sales of CDs had already slumped.

“The studios are realising they have to get out in front of it and create as many legitimate distribution points as they can, rather than fighting abuses all the time,” he said.

BitTorrent will offer a mixture of free and paid content. Customers will be able to rent films for $2.99-$3.99 with music videos and TV shows, available for purchase. Users and independent artists will also be able to upload their own content to the site.