KaZaA and Estonia
May. 12th, 2003 01:55 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
rfmcdonaldFrom the City Paper:
Kazaa - Baltic-made
Youths from cyber-savvy Estonia write the new Napster, delivering a blow to the global entertainment industry.
By Michael Tarm
When Swedish software developer Niklas Zennström cast about for help in writing a powerful new Internet program, colleagues raised eyebrows when he chose three unheralded youths from little-known Estonia.
But jaws dropped when the file-swapping program called KaZaA that the shy twenty-somethings wrote from their spartan, two-room Tallinn office catapulted through cyberspace to become the No. 1 downloaded software on the Net—with over 200 million users to date and counting.
KaZaA, similar to the infamous Napster it succeeded, has shaken a legal hornets nest, prompting dozens of lawsuits by the music industry claiming the Estonian-made program has helped Web surfers pilfer billions of copyrighted recordings.
Using KaZaA, a person can find virtually any song or movie—sometimes even before it is officially released—and download it for free. On any given afternoon, over 3 million people are on the KaZaA network sharing more than 500 million files—far more traffic than Napster ever generated.
Zennstrom, 36, and the Estonians—Ahti Heinla, Priit Kasesalu and Jaan Tallinn, all now 30—don’t own KaZaA anymore. But that hasn’t kept them out of the legal cross-hairs, nor has it stopped them from staunchly defending their creation.
Critics contend that KaZaA was created, first and foremost, to give unscrupulous Internet users a means to steal music and films.
“We’re breeding a new group of people who wouldn’t dream of going into a video store and putting a DVD under their coat,” Jack Valenti, a prominent entertainment lobbyist and frequent KaZaA critic, recently told The Harvard Review. “But they have no compunction about bringing down a movie off the Internet.”
Zennstrom and the three Estonians, however, insist they developed KaZaA for legitimate purposes, including to exchange home videos or to download public-domain literature, like the Bible.
Heinla, his blond hair flowing to his white T-shirt, said KaZaA simply made the Internet a more efficient information highway.
“We didn’t see ourselves as creating vehicles for pirates—but as creating vehicles for the music industry itself and others like them,” said Heinla. “The piracy side has received more press than the other opportunities we created.”
“People may use KaZaA to share music, but we didn’t design it for that,” Zennström, the designated spokesman for the group, chimed in during an interview in a Tallinn café. “Consumers decide what to do with the tool. You can’t blame the tool maker.”
The lanky, serious Swede likened those who misuse file-sharing software to college students misusing photocopy machines to copy whole textbooks.
“What are you going to do? Ban copy machines?” he asked. “Of course not. You allow technology to evolve ... Our product just happened to be the best copy machine in the store.”
Zennstrom said music producers once feared radio and video recorders would ruin them—but both proved a boon to the industry. He said they could also use programs like KaZaA—whose name doesn’t mean anything in particular—to improve their distribution in the Internet Age.
“They should see people like us as their friends, not enemies,” argued the Swede. “But they can’t seem to get beyond old thinking.”
Zennstrom and his Danish partner, 26-year-old Janus Friis, knew what they wanted KaZaA to do when they hired the Estonian whiz kids: enable any two online computers in the world to exchange large files seamlessly without—in contrast to Napster—having to rely on a central server.
Only they weren’t sure how to solve the complex software puzzles that posed.
“It was the Estonians—the three of them, not a full research department—who came up with the programming code,” he explained. “That was the key.”
He said the software, pounded out in just four months starting in mid-2001, worked almost glitch-free from the start. It was setting usage records on the Web within the year.
With little apparent foresight about its coming popularity, the Estonians reportedly turned down stock options on the software.
“Were we surprised at how successful KaZaA’s been?” said Heinla. “Yes, really surprised. We had no idea.”
That the software breakthrough occurred in this ex-communist state of less than 1.5 million people was no fluke, argued Zennström.
Heavily forested Estonia, known more abroad for pulp-paper exports or perhaps for its Eurovision Song Contest successes, may not have had the reputation of a Silicon Valley. But thanks to radical reforms, it was already seen as the economic star of the ex-Soviet bloc.
It had, more to the point, embraced the Internet with a vengeance.
With investment from nearby Finland, Estonia leapfrogged older technologies. Many Estonians rushed to buy cell phones before ever owning a landline telephone, a scarcity in Soviet days.
And Estonia went from having almost no computers to having online access from most homes and offices. Nearly half of Estonians bank online, one of the world’s highest rates.
Some dubbed the country e-stonia.
“In many ways, like online banking, Estonia is now even more advanced than Sweden. Its Internet infrastructure is great,” said Zennström, adding that the 45-minute flight from his Stockholm home made doing business in Estonia easier. Tallinn, he said, is closer to Stockholm than some major Swedish cities, like Götberg.
It was convenient and cost effective: The average monthly wage here is about around 5,000 kroons, or some 300 dollars—at least three times less than in Sweden. Skilled Estonian programmers make more, but still not as much as their Western counterparts.
Zennström bristles at charges from music industry lawyers that he played a shell game, purposefully moving outside the United States to evade U.S. copyright law.
“Maybe the United States is the center of the universe,” he scoffed. “But we do business in Sweden and Estonia, because that’s where we live. There’s no conspiracy going on here.”
Record executives demonstrated how impressed, or horrified, they were by KaZaA when it became widely available in late 2001 by promptly petitioning to have it yanked off the Internet.
Their anger has been exacerbated by falling record sales, which they blame in part on KaZaA and lesser file-sharing programs.
“The music industry now is suffering nine, ten, fifteen percent losses in revenue a year,” said music industry spokesman Valenti. “When you compound that over the next three or four years, the music industry is dead. I don’t see a future for it. After a while, who’s going to produce it?”
He’s also dismissed the analogies likening KaZaA to a newer and better copy machine or VCR.
“The difference between analog piracy and digital piracy is the difference between lightning and the lightning bug,” he said. “It’s very cumbersome to deal in piracy of videocassettes; it costs a lot of money. But in digital piracy, with the click of a mouse a 12-year-old can send a film hurdling around the world.”
Some courts have accepted those arguments.
A judge in the Netherlands, where Zennström’s company was initially registered, did order that KaZaA be pulled from circulation last year. A few months later though, an appellate court reversed that decision—reviving KaZaA’s fortunes.
In the interim between those two decisions, under intense legal and financial strain, Zennström sold KaZaA to the Australian-based Sharman Networks. It now bears the brunt of the increasingly aggressive, U.S.-driven litigation.
Zennström declined to say how much he was paid for KaZaA, hinting that it wasn’t a lot. The Estonians, he said, “didn’t benefit much financially from its sale.” They still work from the same modest premises, sharing two or three computers.
He and the Estonians aren’t likely to escape legal scrutiny any time soon.
A U.S. court, for instance, recently tried to force the Estonians to give depositions in a case naming KaZaA—but a Tallinn judge ruled that the request was far too vague and that they didn’t have to comply.
However the litigation plays out—even if it ends, as it did for Napster, in their creation’s demise—KaZaA will at least have helped put Estonia on the world IT map. And it will have ended the relative obscurity of the three programmers.
Most Estonians don’t even try to conceal their pride that their fellow countrymen have provoked such a global-scale fuss.
“People are very impressed,” said Kristjan Ostmann, editor of Internet news at Estonia’s Postimees daily. “Their work is brilliant.
Kazaa - Baltic-made
Youths from cyber-savvy Estonia write the new Napster, delivering a blow to the global entertainment industry.
By Michael Tarm
When Swedish software developer Niklas Zennström cast about for help in writing a powerful new Internet program, colleagues raised eyebrows when he chose three unheralded youths from little-known Estonia.
But jaws dropped when the file-swapping program called KaZaA that the shy twenty-somethings wrote from their spartan, two-room Tallinn office catapulted through cyberspace to become the No. 1 downloaded software on the Net—with over 200 million users to date and counting.
KaZaA, similar to the infamous Napster it succeeded, has shaken a legal hornets nest, prompting dozens of lawsuits by the music industry claiming the Estonian-made program has helped Web surfers pilfer billions of copyrighted recordings.
Using KaZaA, a person can find virtually any song or movie—sometimes even before it is officially released—and download it for free. On any given afternoon, over 3 million people are on the KaZaA network sharing more than 500 million files—far more traffic than Napster ever generated.
Zennstrom, 36, and the Estonians—Ahti Heinla, Priit Kasesalu and Jaan Tallinn, all now 30—don’t own KaZaA anymore. But that hasn’t kept them out of the legal cross-hairs, nor has it stopped them from staunchly defending their creation.
Critics contend that KaZaA was created, first and foremost, to give unscrupulous Internet users a means to steal music and films.
“We’re breeding a new group of people who wouldn’t dream of going into a video store and putting a DVD under their coat,” Jack Valenti, a prominent entertainment lobbyist and frequent KaZaA critic, recently told The Harvard Review. “But they have no compunction about bringing down a movie off the Internet.”
Zennstrom and the three Estonians, however, insist they developed KaZaA for legitimate purposes, including to exchange home videos or to download public-domain literature, like the Bible.
Heinla, his blond hair flowing to his white T-shirt, said KaZaA simply made the Internet a more efficient information highway.
“We didn’t see ourselves as creating vehicles for pirates—but as creating vehicles for the music industry itself and others like them,” said Heinla. “The piracy side has received more press than the other opportunities we created.”
“People may use KaZaA to share music, but we didn’t design it for that,” Zennström, the designated spokesman for the group, chimed in during an interview in a Tallinn café. “Consumers decide what to do with the tool. You can’t blame the tool maker.”
The lanky, serious Swede likened those who misuse file-sharing software to college students misusing photocopy machines to copy whole textbooks.
“What are you going to do? Ban copy machines?” he asked. “Of course not. You allow technology to evolve ... Our product just happened to be the best copy machine in the store.”
Zennstrom said music producers once feared radio and video recorders would ruin them—but both proved a boon to the industry. He said they could also use programs like KaZaA—whose name doesn’t mean anything in particular—to improve their distribution in the Internet Age.
“They should see people like us as their friends, not enemies,” argued the Swede. “But they can’t seem to get beyond old thinking.”
Zennstrom and his Danish partner, 26-year-old Janus Friis, knew what they wanted KaZaA to do when they hired the Estonian whiz kids: enable any two online computers in the world to exchange large files seamlessly without—in contrast to Napster—having to rely on a central server.
Only they weren’t sure how to solve the complex software puzzles that posed.
“It was the Estonians—the three of them, not a full research department—who came up with the programming code,” he explained. “That was the key.”
He said the software, pounded out in just four months starting in mid-2001, worked almost glitch-free from the start. It was setting usage records on the Web within the year.
With little apparent foresight about its coming popularity, the Estonians reportedly turned down stock options on the software.
“Were we surprised at how successful KaZaA’s been?” said Heinla. “Yes, really surprised. We had no idea.”
That the software breakthrough occurred in this ex-communist state of less than 1.5 million people was no fluke, argued Zennström.
Heavily forested Estonia, known more abroad for pulp-paper exports or perhaps for its Eurovision Song Contest successes, may not have had the reputation of a Silicon Valley. But thanks to radical reforms, it was already seen as the economic star of the ex-Soviet bloc.
It had, more to the point, embraced the Internet with a vengeance.
With investment from nearby Finland, Estonia leapfrogged older technologies. Many Estonians rushed to buy cell phones before ever owning a landline telephone, a scarcity in Soviet days.
And Estonia went from having almost no computers to having online access from most homes and offices. Nearly half of Estonians bank online, one of the world’s highest rates.
Some dubbed the country e-stonia.
“In many ways, like online banking, Estonia is now even more advanced than Sweden. Its Internet infrastructure is great,” said Zennström, adding that the 45-minute flight from his Stockholm home made doing business in Estonia easier. Tallinn, he said, is closer to Stockholm than some major Swedish cities, like Götberg.
It was convenient and cost effective: The average monthly wage here is about around 5,000 kroons, or some 300 dollars—at least three times less than in Sweden. Skilled Estonian programmers make more, but still not as much as their Western counterparts.
Zennström bristles at charges from music industry lawyers that he played a shell game, purposefully moving outside the United States to evade U.S. copyright law.
“Maybe the United States is the center of the universe,” he scoffed. “But we do business in Sweden and Estonia, because that’s where we live. There’s no conspiracy going on here.”
Record executives demonstrated how impressed, or horrified, they were by KaZaA when it became widely available in late 2001 by promptly petitioning to have it yanked off the Internet.
Their anger has been exacerbated by falling record sales, which they blame in part on KaZaA and lesser file-sharing programs.
“The music industry now is suffering nine, ten, fifteen percent losses in revenue a year,” said music industry spokesman Valenti. “When you compound that over the next three or four years, the music industry is dead. I don’t see a future for it. After a while, who’s going to produce it?”
He’s also dismissed the analogies likening KaZaA to a newer and better copy machine or VCR.
“The difference between analog piracy and digital piracy is the difference between lightning and the lightning bug,” he said. “It’s very cumbersome to deal in piracy of videocassettes; it costs a lot of money. But in digital piracy, with the click of a mouse a 12-year-old can send a film hurdling around the world.”
Some courts have accepted those arguments.
A judge in the Netherlands, where Zennström’s company was initially registered, did order that KaZaA be pulled from circulation last year. A few months later though, an appellate court reversed that decision—reviving KaZaA’s fortunes.
In the interim between those two decisions, under intense legal and financial strain, Zennström sold KaZaA to the Australian-based Sharman Networks. It now bears the brunt of the increasingly aggressive, U.S.-driven litigation.
Zennström declined to say how much he was paid for KaZaA, hinting that it wasn’t a lot. The Estonians, he said, “didn’t benefit much financially from its sale.” They still work from the same modest premises, sharing two or three computers.
He and the Estonians aren’t likely to escape legal scrutiny any time soon.
A U.S. court, for instance, recently tried to force the Estonians to give depositions in a case naming KaZaA—but a Tallinn judge ruled that the request was far too vague and that they didn’t have to comply.
However the litigation plays out—even if it ends, as it did for Napster, in their creation’s demise—KaZaA will at least have helped put Estonia on the world IT map. And it will have ended the relative obscurity of the three programmers.
Most Estonians don’t even try to conceal their pride that their fellow countrymen have provoked such a global-scale fuss.
“People are very impressed,” said Kristjan Ostmann, editor of Internet news at Estonia’s Postimees daily. “Their work is brilliant.
