Kazaa to become legal download service

After a number of legal battles and an Australian court order that
eventually barred the Kazaa peer-to-peer file sharing software from
users in Australia, Sharman Networks—the company behind
Kazaa—has agreed to
pay $100 million in damages
to the record industry. In addition to
the settlement, Sharman also
plans
to turn Kazaa into a legal content download service:

“It has been our long standing goal for Kazaa to play a significant role
in the growing market for licensed online distribution and authorised
exchange of copyrighted content using peer-to-peer technology, and this
settlement ensures that we will be working together with the content
providers to the benefit of consumers, businesses and artists,” said
[Nikki Hemming, CEO of Sharman Networks].

Kazaa will be loosely following in the footsteps of Napster, which also
began as a largely illegal file sharing network before being shut down,
going bankrupt, and finally being re-introduced by Roxio as a legal
music download service. With Kazaa, however, Sharman wants to “make
[peer-to-peer] an integral part of the future of online digital
entertainment,” which suggests a strategy different from that of Napster
and iTunes.

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