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Broadband technologies transforming business models and challenging regulatory frameworks - lessons from the music industry


In the late 1990s, MP3 became one of the most important Internet search objects, indicating that music played a dominant role in network content. In 2003, the file-swapping program Kazaa topped the Internet search list. Over 340 million copies of Kazaa's Fast Track software had been downloaded by December 2003. File-sharing or Peer-to-Peer activities (P2P), mainly involving audio/audio-visual products, have become the main driver of broadband traffic, accounting for over 50% of capacity. P2P technology has allowed millions to engage in interactivity (inclusion) and provided new methods for marketing intellectual property and knowledge related products. At the same time, it has created serious problems for traditional business models and modes of digital asset protection.

With content owners' strategies leading to the closing of earlier applications such as Napster, and driving file-sharing development to higher degrees of user anonymity, major problems for optimising network traffic management have emerged. As with every popular Internet application, P2P has also become a target for malicious software and lacks the security sophistication of its technological cousin, the GRID. A research task is to evaluate and compare both threats and opportunities, providing a better basis for policy-making.

New business models are appearing in the Peer-to-Peer environment, particularly in the music industry, a key area where early adoption of new technology has traditionally demonstrated important lessons for many other industrial sectors. MUSICLESSONS will combine technological and socio-economic research into these conflicting trends with pan-European studies of consumer behaviour. It will deliver examples of emerging business models, analyses of technological constraints and insight into related consumer behaviour and interests, thereby providing scientific support for policy-making aimed at balancing regulatory constraints with other goals such as inclusion.


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