Napster, Round 2

There is technology out there that is being developed as we speak that is going to make Napster look obsolete any minute.

—Metallica’s Lars Ulrich, to ABC News

Lars, it’s already here. It’s called Freenet. Created by Ian Clarke, a 23-year-old Irish programmer, Freenet lets users trade files directly, without having to go through a “middleman” computer. Like the legally beleaguered Napster and its now open-source cousin Gnutella, Freenet is absolutely fascinating from a software-engineering point of view. But for music and film artists, record labels, movie studios, and other copyright holders, it’s a vision of the apocalypse.

“I can’t envision a way to shut down Freenet without shutting down the Internet,” Clarke says.

In essence, Freenet uses the Net as a giant communal hard drive. Users download the Freenet code and agree to allot a certain number of megabytes on their hard drives to the storage of Freenet files. Any sort of information can then be stored on the participating computers. This is where it gets most interesting. Freenet was created for anonymity. By design, it is difficult to find out what is being stored — and where. Like soldiers on active duty, files “ship out,” when requested, to new locations.

Freenet relies on “keys” to point to the files. The keys are roughly equivalent to URLs. You put up, oh, let’s say, your illegally decrypted copy of The Matrix DVD. You give it the key “The Matrix,” and someone searching on that key will turn it up. But they won’t know that the file originated with you. It may not even be on your hard drive anymore, having migrated to another computer whose owners won’t know it’s there, because it’s been encrypted. All they will know is that something is taking up space on their hard drive. By comparison, the weak link that opened Napster and hundreds of thousands of its users to litigation is a centralized directory in which user IDs are stored. Gnutella goes one better by having no central directory, but it still relies on static IP addresses, the digital equivalent of yelling, “Hey, I’m over here!”

Clarke designed Freenet’s anonymity and encryption features specifically to protect users against legal liability. Special Agent Ramiro Escudero, an FBI spokesperson, says Clarke’s scheme “might possibly” work. The argument would go like this: Someone left a locked suitcase in my closet. I can prove it doesn’t belong to me, I can prove I don’t have a key, I can prove I have no idea what’s inside it — all I did was agree that it could be left with me. “According to this scenario,” cautions Escudero, “it would not appear that you would be criminally liable, but it’s always case by case.” The law looks differently at you storing a suitcase left by your mother vs. your brother-in-law the Mafia kingpin, Escudero explains. In other words, should Freenet eventually become known as a place where bad people hide bad things, some of the shielding might disappear.

John Markoff of The New York Times, in a front-page story, portrayed Clarke as an arrogant, capitalism-challenged anarchist. You can almost feel the mano-a-mano thing going on in the interview between the veteran technology reporter and yet another genius kid.

With me, Clarke is at great pains not to be provocative, and I am equally at pains to be fair. But, listening to him offer the disclaimer that “If you sell water in the desert, but one day it starts to rain, there’s no one for you to sue,” I can’t help but think of Tom Lehrer’s parody tribute to Werner von Braun (I’m sure there’s an illegal copy online somewhere): “Once the rockets go up, who cares where they come down? That’s not my department!”

Freenet is like many double-edged-sword technologies — one can imagine a thousand benign and even laudable uses, e.g., fighting a government that imprisons people for advocating freedom, or a corporation that fires people for telling the truth about their products. “I think freedom of information should be total,” says Clarke. “You can’t pick and choose. It’s incredibly patronizing to think that if you give people ‘wrong information,’ they’ll do the wrong thing. By removing censorship, you remove the crutch, this intellectual narcotic.”

But Clarke, who majored in artificial intelligence at the University of Edinburgh (one of the best computer-science schools in the United Kingdom), says his motivation in creating Freenet was not political but, rather, technical. Now working for Dynamic Blue, a Web-design firm in London, he says Freenet grew out of a paper he wrote in his final year at Edinburgh. “Not to create havoc with copyright or even a way around censorship,” he insists. “I was fascinated by complex systems which consisted of individuals following simple rules, where no one individual was fundamental to the operation of the system. Consider a flock of birds in formation. If you were to shoot one bird, it wouldn’t destroy the formation — because it doesn’t rely on any one individual bird.”

The unfortunate downside to Freenet is that it’s just ratcheted up the illegal distribution of copyrighted material by an order of magnitude. Not to mention child porn and other nasty things. Those are negatives Clarke already has grown weary of addressing, especially when there are more pressing technical questions to answer.

Like how easily his system might spread Trojan-horse viruses. Ian says Freenet’s users must be vigilant and trade only with trusted sources, indicated by digital signatures. If you clicked open an “I Love You” e-mail . . . for your own sake, stay the hell away from Freenet. Says Clarke, “I also feel that the ease with which people could open the ‘I Love You’ attachment in Microsoft’s e-mail software was the cause of this problem. We wouldn’t make it so easy to do this with Freenet.”

One of the most interesting unanswered questions could prove to be the Achilles’ heel of Freenet: Just how do you find relevant information in a network that relies on “keys” arbitrarily assigned by users? In a library, you know a search for Michael Jordan is bound to turn up material on the basketball player. On Freenet, “Michael Jordan” might be the key to someone’s pictures of naked Barbie dolls. Clarke says the problem is self-correcting. Freenet files move about according to demand. Put up something stupid, and it will eventually drop off the system. One of the next tasks for the consortium of volunteer programmers developing Freenet is to implement a search engine, Clarke adds.

And what happens when you combine an easy-to-use search engine and interface with multimedia files? You come up with Beverly Hills–based, also created by early-20-somethings. Only these guys from UCLA have no problem with becoming obscenely rich.

Although the legal and media attention in the online copyright wars has focused on Napster and,, which went online in 1997, inadvertently enables users to access a wide range of copyrighted film and music titles without paying. Oh, and the company carries a heavy dose of irony: One of its backers is Michael Ovitz.

Go on Scour and do a search on movie titles (if you’re in the film industry, you may want to have a lawyer and a bottle of smelling salts by your side). On a recent foray, American Beauty and Gladiator were unavailable, but I got hits for both The Matrix and Fight Club, albeit broken up into several files. The files were stored on i-drive, a free Internet storage service also started by a UCLA grad, with which Scour has a business relationship.

Despite the odor of copyright infringement, both i-drive and Scour may be as innocent as the owner of a storage facility who rented to a guy who used the space to stash dead bodies. Senior executives at both companies would very much like to stay out of the line of fire. Says Jeff Bonforte, CEO of i-drive, “We need to help studios and labels solve these problems. We make our money off relationships, not people sharing things illegally.” In almost the same words, both executives explain that they are in compliance with the Digital Millennium Copyright Act. The DMCA requires that they remove files only after they have received a “conforming notice” from the copyright owner. And as Craig Grossman, general counsel for Scour, explains, “Our goal is to get it right. Congress gave us a law that has some ambiguities, but the notice and conforming process are pretty clear . . . The lesson to users is, you’ve got responsibilities.”

On the other hand, “I don’t think anyone, even the labels themselves, believe they can solve the problems in the courtroom,” says Bonforte. “You could shut down Napster tomorrow, and MP3s will still be traded — because digital distribution makes so much sense.” The problem, then, is how do you get people to pay for the stuff? Says Jeff Taylor, a spokesperson for the MPAA, “Some people are doing things online they wouldn’t contemplate doing on terra firma — they’d never go into a store and put a DVD in their backpack.”

One answer is called “Digital Rights Management” (DRM), software that encrypts media files and unscrambles them only when the user forks over a fee. With DRM in place, a person who went to open a downloaded file from Napster — or even Freenet — would see a notice asking for payment to be sent on to the original copyright holder. Theoretically, it’s a make-everybody-happy solution. But industry experts disagree on when or if various proposed DRM schemes can work.

Dan Rodrigues, president and co-founder of Scour (and only a year older than Ian Clarke), says, “I don’t think anybody’s hit the Holy Grail, but I think you will see the pieces come together. There might be a free model, where you give up some personal information or go through a lot of ads first. There could also be a subscription model, and possibly even a model where you pay for premium and secure digital downloads. Ultimately there will be several different ways of paying for convenience, from credit cards to paying with eyeballs, as you do with free television.”

Clarke, however, believes the model that will ultimately prevail is that of shareware: I write a cool piece of code, put it out there and say, “If you find this useful, please send me a check for five dollars.” Unfortunately, it’s kind of like those public-television pledge drives. You know you should send them a check. One of these days. In other words, ain’t nobody buying houses in Malibu off the proceeds of shareware. Which means that those of us who dreamed of making our riches in “content” — be it movies, music or epic poetry — may be SOL (shit out of luck).

Nobody in this town is going to feel sorry for some $20 million name-above-the-title who suddenly finds his or her gross points are worth crap. But if Clarke is right, and Rodrigues, Taylor and the rest of the copyright crowd are wrong, five or 10 years down the line, film- and music-company revenue models could be dead. And after years of waiting or dancing on tables, when you finally get the shot you’ve worked so hard for, you may find a zero or two lopped off your check.

Ian Clarke would like us to live on principle. Although I admire his intellect, I’d rather live off interest.