November 12, 2003 3:13 PM PST

Kazaa to launch P2P print ads

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Kazaa parent Sharman Networks plans to unveil its first offline advertising campaign next week, in which it will exhort computer users to defend file swapping and tell entertainment companies they can make money too.

The Australian company has been scrambling for months to find a way to convince record companies and movie studios that it is sincerely interested in becoming a legitimate, licensed distributor of mainstream entertainment content. It hasn't yet been successful--Sharman and Kazaa, its file-swapping software, are still the target of lawsuits from the entertainment companies. Sharman hasn't struck any large-scale distribution deals with major studios or record labels.

According to a brief statement previewing the campaign, the print ads will be a "call to action to peer to peer (software) users to communicate the message that, given the chance, users will pay a fair price for movies, music and games from P2P networks."

The ads are also intended to tell traditional entertainment companies that they are "missing a huge opportunity" to reach file-swapping communities, according to the statement.

For much of its two-year existence, Sharman has been pursuing two goals that many see as mutually exclusive. Its Kazaa software has created far and away the largest file-swapping community online, built in great part on the unauthorized and unregulated exchange of copyrighted works, such as music and movies.

But it also has worked increasingly closely with Altnet, a division of Brilliant Digital Entertainment, to persuade the file-swapping community to buy or download authorized versions of entertainment content such as music or video games. Ultimately, the company has claimed in lawsuits filed against the recording industry and Hollywood studios, it intended to push unauthorized sharing almost wholly off the network.

"By relegating non-(copy protected) files to a subordinate and comparatively unattractive access location...Sharman intended to promote and encourage only business appropriate file sharing and to share the net payments for (copy protected) works lawfully exchanged by users of the (Kazaa) software with Altnet," court papers filed by Sharman in September said.

Sharman and Altnet have also been working though a trade association they started, the Distributed Computing Industry Alliance, to try to create a forum where entertainment companies, Internet service providers and file-swapping companies can agree on business models that serve all three interests. To date, that group has found it difficult to attract other parties into serious discussions, however.

The Sharman print ad campaign will launch on Nov. 19, the company said.


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