Impact of P2P and Free Distribution on Book Sales

Background on the Peer-to-Peer (P2P) Universe

This section provides an overview of the P2P universe: the recent history, the most significant players, and how the sites currently work, including business models in place at the time of the study.

Precursors: Early File-Sharing Methods

Usenet and file transfer protocol (FTP), systems that can share files over networks, were established in the 1980s. Usenet and FTP are used primarily for legitimate purposes, although both have also been used for illegal file transfers.

Usenet, a system created by two college students to allow users to read and post articles to others in their newsgroups, operates in a manner similar to today’s discussion forums. Rather than store information on a single server, Usenet allows information to be distributed across multiple servers. Users read and post messages on their newsgroup servers, which periodically contact one another to update and exchange information. The introduction of Usenet dramatically reduced server loads and allowed information to be transferred more easily.

Because it is easy to falsify the source information on files transferred through Usenet, and because it is not easy to remove an illegal file from all independent servers at once, the Usenet networks became a conduit for illegal file sharing.

File Transfer Protocol (FTP) is widely used for legitimate file transfers. It can also be employed to transfer copyrighted materials between users. The general layout and construction of FTP makes ...