The fallout of the recent Grokster v. MGM Supreme Court decision hasn’t meant much to the wellspring of new legally minded peer-to-peer companies who are looking to turn a pirate’s territory into a legitimate delivery system for music, movies and video games.
While Grokster and StreamCast face more time in court, legal P2P software companies like Peer Impact, Weed and Mercora make strides into turning their file-sharing services into a legitimate industry with the potential for plenty of profit to spread to music labels, musicians and in some cases, to the users.
Peer Impact has been working to create a legal peer-to-peer download platform that allows music lovers to search for music, pay for it and then download it from other Peer Impact users.
The company has also instilled a recommendation feature that can pay off for active consumers.
Users can e-mail 30-second clips of music to friends as a recommendation. If the friend buys the track, then 5 percent of that profit goes to the sender.
Aside from loading its software with various user-friendly features, Peer Impact has spent a large amount of time earning the approval of the music industry.
CEO Greg Kerber and CTO Kirk Feathers said they spent many hours in front of music executives’ doorsteps negotiating deals, which they have now done with the Big Four labels, e.g. Sony BMG Music Entertainment, Universal Music Group, Warner Music Group and EMI.
This week, the company announced its deal with Trymedia Systems, a digital distribution service for PC video games.
Kerber and Feathers have also taken their business plan to the RIAA to prove its legitimacy as a legal online music distribution system.
Based on history of the organization with file-sharing services like Napster and Grokster, this seemed to be less of a harrowing experience than expected.
“The salt and pepper in our hair probably helped a little,” Kerber quipped. Overall, he said the RIAA has been “very cooperative.”
“We’ve had hundreds of meetings with them, and every time we’re there, [RIAA members] say ‘we are not Luddites; we are not against technology; we just want artists to get paid for their work,” he said. “They have really taken the brunt of some bad PR.”
In the meantime, the group is in talks with “every major content provider out there,” and is looking to sign similar deals with the film and TV industry.
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