Kazaa improves software, signs deal with large ISP

Coming as a one-two punch at the piracy-plagued music industry, Sharman Networks Ltd. Monday released a new version of its popular peer-to-peer (P-to-P) file-swapping software Kazaa, giving users enhanced swapping capabilities, while at the same time announcing a deal with a major European Internet service provider (ISP) that may serve to raise its legitimacy level.

In addition to releasing Kazaa Media Desktop version 2, Sharman Networks has sealed a deal with major European ISP Tiscali SpA, whereby the P-to-P company advertises Tiscali's broadband service to its legions of users, in exchange for getting paid a small "bounty" when users sign up with Tiscali. Tiscali is based in Italy but has operations in 15 countries, including France, Germany and the U.K, and is the leading independent European ISP.

"We feel very strongly about the significance of P-to-P as a driver of broadband adoption and appreciate that it is a priority in these countries," said Kelly Larabee, a spokeswoman for Sharman Networks.

While the music industry continues to battle file-swapping services like Kazaa because they allow users to trade copyright-protected works, ISPs are recognizing that they have a lot to potentially gain from the media delivery services -- mainly, users. According to Kazaa, users have downloaded more than 120 million files from its network to date, and have racked up considerable time culling through their available content.

And if the Kazaa's recognition as an enviable broadband promoter weren't enough to leave music execs chagrined, Kazaa's souped up trading features might do just that.

The latest version of the P-to-P software offers the ability to share playlists, which can be downloaded as a collection. It also offers Web search through the Kazaa interface, user file integrity ratings and integrated antivirus protection, as well as music content from online music community Cornerband.com.

Frequent Kazaa version 2 users will also get rewarded for their participation, by giving them a higher priority in download queues.

Additionally, a Kazaa Showcase feature links users to premium content available on the Altnet network, which just recently put its micropayment system in place, allowing users to purchase music, video and software.

The new software and ISP alliance should place Kazaa in a strong position among the P-to-P service providers, which are expected to experience continued growth over the next few years. According to the latest Yankee Group research, U.S. users alone are expected to download 7.44 billion audio files from unlicensed file-swapping services in 2005.

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