Kazaa's owner breaks silence

By Jeanne Vida Douglas, ZDNet Australia, 24 April, 2002 10:17

INTERVIEW

With 2.3 million downloads last week alone, and up to 1.82 million users online at any one time, the ongoing secrecy surrounding Kazaa's antipodean owners, Sharman Networks, doesn't appear to have affected the software's popularity. After months of speculation Sharman Networks' elusive chief executive Nikki Hemming has released details of her plans for Kazaa, and the operations of little known umbrella company LEF Interactive. Sharman Networks came from nowhere in early March to purchase the popular file swapping technology Kazaa from its Dutch creators, then immediately disappeared into an tide of speculation, as Hemming went to ground to organise a full launch of the company. Backed by a series of individual investors, including Hemming, Sharman Networks has listed its operations on the Pacific Island of Vanuatu in order to capitalise on "tax efficiencies": however, it will run its business from offices in Sydney and London. Hemming registered LEF Interactive in late February just prior to the purchase of the Kazaa technology, in order to cover Sharman Networks' Australian operations. "LEF Interactive represents Sharman Networks in Australia, in what is a fairly standard business practice," Hemming said, revealing LEF whimsically represents the core tenants of the French revolution liberté, egalité, fraternité. Having continued to re-release the Kazaa software despite the media shutdown, Hemming said she is keen to maintain a bi-quarterly release rate. To date this has been achieved via a virtual office, but Hemming has confirmed plans to open an office in the Sydney suburb of Cremorne. "We set up the development team from scratch and they are entirely based in Sydney," Hemming said, also referring to plans to expand the company headcount from seven to nine with the appointment of a brand manager and assistant. "Australia is really a fantastic place to test emerging technologies, and we will continue to focus our development here." In keeping with the promise of bi-quarterly new releases, Hemming foreshadowed the imminent release of a multilingual version of the software. Hemming confirmed plans to continue the relationship with Brilliant Digital, and announced a new deal with Double Click that will see DART technology rolled into Kazaa downloads. "We produce a piece of software that is available for free, and provides advertisers with access to a large and rich user channel," Hemming explained, pointing out that at this stage she wasn't making major changes to the company's business model. "The investors backing Sharman Networks are not vanity investors -- they are interested in driving the business forward in terms of profitability," Hemming said. "And they are already seeing good results." Hemming went on to explain that the company received a mixture of advertising revenue, and a shared percentage of the revenue from sales generated by online ads. While quashing speculation of Telco participation in the Kazaa investment, Hemming described P2P technology as the long sought-after "killer app" which could drive broadband uptake, signalling her interest in telco partnerships. "We are already in discussions with a major service provider in France, who wants to use our advertising to emphasise the benefits of broadband," Hemming said. Hemming also addressed the issue of privacy and downloads which caused a furore earlier this month when it was revealed that the Brilliant Digital downloads included in the Kazaa downloads could potentially link Kazaa users into network nodes in a massive attempt to create a distributive computing network. "We released a privacy policy along with the 1.6 version of the software, based entirely on full disclosure," Hemming said. "We make sure we are telling the users exactly what they are downloading and provide opt-in, opt-out functions if possible." In keeping with the privacy bent, Hemming said the policy would apply to any new advertising partners and would be retrospectively written into pre-existing contracts. Apart from assuring full disclosure at the download point, the policy also vetos auto update functions and the collection of any information from end users without explicit permission. With respect to intellectual property and copyright protection, Hemming said she was not aware of any attempt made by the Australian Record Industry Association to contact Sharman Networks. Operating as it does under LEF Interactive in Australia, the company would be subject to Australian legislation, however Hemming believes a Dutch court's ruling in favour of Kazaa in late March would bode well for the company's continued survival. "It hasn't been tested in Australia, but the precedent has been established which demonstrated that Kazaa itself does not infringe on copyright at all," Hemming said. Nonetheless, Hemming concedes the fortunes of P2P software will be largely determined in the US, and to this end has hired a Washington-based lobbyist to promote the notion of an "IP user fee" to US legislators. "We are looking at a monetising solution to the question of IP, and trying to find ways that everyone in the value chain can be reimbursed from the success of their creation," she said. However, Hemming also said she expected to gain significant support from the independent music sector, and content creators interested in P2P based delivery. "This is not the early adopter phase of P2P technology, advertisers understand that, and its time the music and film industry started to pay some serious attention to the benefits of the technology," Hemming said emphatically. "Collusion is better than attrition." Somewhat ironically, Kazaa is plagued by a ripped version of its P2P software which goes by the name of Kazaa Lite. Hemming confirmed she had approached the product's distributors with a cease and desist request drafted by her legal team at Sydney-based lawyers Phillips Fox. "Luckily we have a good relationship with some of the search engines who agreed to remove the highlighted links to Kazaa Lite because they were misleading," Hemming said.

For everything Internet-related, from the latest legal and policy-related news, to domain name updates, see ZDNet UK's Internet News Section. Have your say instantly, and see what others have said. Go to the ZDNet news forum. Let the editors know what you think in the Mailroom.

Post your comment

In order to post a comment you need to be registered and logged in.

You can also log in with Facebook. Log in or create your ZDNet UK account below

By signing up for this service, you indicate that you agree to our Terms and Conditions and have read and understood our Privacy Policy. Questions about membership? Find the answers in the Community FAQ

ZDNet UK Live

I totally dislike pirating of works, I fear that artists will be deterred from creating works if they think that they are going to get ripped off....

14 minutes ago by GHar123 on ACTA stumbles in Germany

How dare film makers, artists or anybody that invests in creativity stop us pirating their works for free. I want to be able to walk into my local...

6 hours ago by JCB33 on ACTA stumbles in Germany

@GrueMaster. I prefer horses for courses rather than one size fits all. I, and I suspect most other computer users, do not really wish to have...

8 hours ago by Moley on A tale of two distros: Ubuntu and Linux Mint

The product that scares me every time I have to use it is the Office 2007 version of Excel. The first bug that I found was applying the median...

8 hours ago by greycynic on Ten flawed products that derail productivity

Nice review and very informative. One thing I'd like to add (in reply to whs001's 1st question), the main reason to have the same interface from...

10 hours ago by GrueMaster on A tale of two distros: Ubuntu and Linux Mint

I'be been using Mint 12 since the RC came out, and I am far more happy with the Cinnamon, the Mate, and, yes (with extensions), theGnome 3...

10 hours ago by Frederick Wrigley via Facebook on A tale of two distros: Ubuntu and Linux Mint

Excellent article. One small correction, though--although a fresh installation of Linux Mint 12 will, indeed, provide the user with a version of...

11 hours ago by bdantas on A tale of two distros: Ubuntu and Linux Mint

In related news, the ISPs club together to get the members of the Home Affairs Select Committee (ya goofed on that part, ZDNet UK) copies of "The...

12 hours ago by Alan Ralph via Facebook on MPs urge ISPs to take down terrorist material

In related news, the ISPs club together to get the members of the Home Affairs Select Committee (ya goofed on that part, ZDNet UK) copies of "The...

12 hours ago by Alan Ralph via Facebook on MPs urge ISPs to take down terrorist material

For Gnome 2 die-hards, it is possible to add icons to the bottom panel (or top top panel, if you prefer) which provide the exact Gnome 2...

12 hours ago by Moley on A tale of two distros: Ubuntu and Linux Mint

Your comments would seem pretty naive and immature. Your 'solution' appears to be, "gee, let's all just give in to the hackers and give them...

13 hours ago by ramwellian on Cloud computing security: no more oxymoron?

"Interesting thought ... If you installed Win7 as a dual boot on a machine that previously only had Linux, and it wrecked your Linux installation,...

13 hours ago by BugStalker on Windows 7 Declares War on GRUB

This is an excellent summary of Ubuntu and Mint and the interface differences between them. Most such articles take a very partisan position for...

13 hours ago by whs001 on A tale of two distros: Ubuntu and Linux Mint

@ewallace. Not so clear. Anyone can obtain the text, for example from here http://www.ustr.gov/webfm_send/2379. I support ACTA so long as it and...

13 hours ago by Moley on ACTA: Facts, misconceptions and questions

I think WinRT is fantastic. I just wish it was an option for people that didn't want to go through Microsoft's App Store with its attendant...

16 hours ago by 45283 on Why Windows 8 needs architectural hygiene for WOA

Nine people? £30m? Who's back pocket is that lot going in? And IF they say it is for new buildings, what about all the ones the government has...

17 hours ago by Burn-IT on Police set to launch three £30m e-crime hubs

Just to be clear, nobody knows what is in the text of ACTA, here is a photograph of the text of ACTA http://twitpic.com/8h9iju as submitted to the...

18 hours ago by ewallace on ACTA: Facts, misconceptions and questions

Unfortunately main issue is that ASUS is refusing to accept that they make some mistake on this version of asus Transformer prime. 1 - GPS sensor...

19 hours ago by fgvrg56 on Asus Eee Pad Transformer Prime Wi-Fi & GPS problems?

@Marcus A fair question. Just talked with Archos which said it was working on an announcement for next week....

20 hours ago by Ben Woods on Archos confirms G9 Ice Cream Sandwich update schedule

Any update on this, considering the claimed "first week of February"?

21 hours ago by Marcus Karlsson via Facebook on Archos confirms G9 Ice Cream Sandwich update schedule

Featured white papers

Latest jobs

Kazaa's owner breaks silence

Daily Newsletters

Topics

Related stories

What's hidden in your hard drive?

Stealth P2P network hides inside Kazaa

Kazaa exec defends sleeper software

How to uninstall Brilliant's software

Data leaks cost Midlothian a record £140k fine

Post your comment

ZDNet UK Live

Latest in Security Management

Data leaks cost Midlothian a record £140k fine

Google-backed DMARC system aims to block phishers

Ten ways to take the sting out of IT disasters

Featured white papers

Latest jobs

Test Analyst - Business Intelligence /Data Warehousing

Test Analyst - Business Intelligence /Data Warehousing

Technical MI Manager - 50-60k - Leeds

Inside ZDNet UK

A tale of two distros: Ubuntu and Linux Mint

2012 Predictions: VCE FastPath, VI SAN Probe & Hadoop

BlackBerry Bold 9790

Case study: How cloud enables growth

Ten factors that make Ubuntu 11.10 a hit

Toshiba Portégé Z830-10P Review

BT's archive: Pictures from the vault

News & Analysis

Reviews

Blogs

Resources

About Us

Member Services

Special Features

Advertising Features

ZDNet UK / News and Analysis / Security / Security Management

Kazaa's owner breaks silence

Daily Newsletters

Topics

Related stories

Post your comment

Get ZDNet UK's daily newsletter

Enter your email address to sign up

ZDNet UK Live

Latest in Security Management

Featured white papers

Latest jobs

Inside ZDNet UK

Resources

About Us

Member Services

Special Features

Advertising Features