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story category BitTorrent Fires Half Their Staff
Actually making money remains a mystery....
11:31AM Saturday Nov 08 2008 by Karl Bode
tags: Fileswapping · business · networking
At some point, BitTorrent creator Bram Cohen grew tired of geek adoration for his ingenious networking creation, and decided he actually wanted to make money. That hasn't gone well -- largely because his company's plan involved the launch of an underwhelming DRM and adware-laden official store, the migration of BitTorrent from open to closed source, making friends with the increasingly hated RIAA and MPAA, and conducting literally thousands of media interviews with CEO Ashwin Navin. Last August the company laid off their marketing staff, and this week the company fired half its staff, while Navin left for greener pastures.

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furionbr

join:2007-07-16
brazil

It was so easy to see...

when you have something that was free and open coded, and you transform that in something paid, bad things will happen.

Still, they own uTorrent, the world's most used BitTorrent client. It is something...
Sammer

join:2005-12-22
Pittsburgh, PA


edit:
November 8th, @10:59AM

Re: It was so easy to see...

said by furionbr See Profile :

when you have something that was free and open coded, and you transform that in something paid, bad things will happen.
While there will always be bitching when something free and open coded is transformed into something paid (think Red Hat) this was more like transforming into what most people consider evil.

King P
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Inman, SC

Re: It was so easy to see...

Yeah, but at least you can still get Red Hat's source code, and modify it (that's where White Box and CentOS come from). This isn't the case with uTorrent.

dnoyeB
Ferrous Phallus

join:2000-10-09
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Red Hat didn't do that. Their products are still open source. Last I checked even their enterprise server was. Red Hat makes their money on service contracts and providing servers and whatnot. They don't sell the software product itself.
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Sammer

join:2005-12-22
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Re: It was so easy to see...

said by King P See Profile :

Yeah, but at least you can still get Red Hat's source code, and modify it (that's where White Box and CentOS come from). This isn't the case with uTorrent.
said by dnoyeB See Profile :

Red Hat didn't do that. Their products are still open source. Last I checked even their enterprise server was. Red Hat makes their money on service contracts and providing servers and whatnot. They don't sell the software product itself.
You guys are making my point and AFAIK Enterprise Server is not open source because it contains proprietary code from third parties. Some in the open source community still bitched about the change in Red Hat's business model but that is very different from how most people view adding DRM and associating BitTorrent with the **AAs.

DONTSUEMEREDHAT

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Re: It was so easy to see...

said by Sammer See Profile :

said by King P See Profile :

Yeah, but at least you can still get Red Hat's source code, and modify it (that's where White Box and CentOS come from). This isn't the case with uTorrent.
said by dnoyeB See Profile :

Red Hat didn't do that. Their products are still open source. Last I checked even their enterprise server was. Red Hat makes their money on service contracts and providing servers and whatnot. They don't sell the software product itself.
You guys are making my point and AFAIK Enterprise Server is not open source because it contains proprietary code from third parties. Some in the open source community still bitched about the change in Red Hat's business model but that is very different from how most people view adding DRM and associating BitTorrent with the **AAs.
i know this is a bit off topic, but I'm really curious, what proprietary code? if anything, i'd say RHEL isn't exactly free because you can't update it without paying for updates.

Yuppy_yix

@co.us

Agreed, and if you don't want Red Hat, get CentOS. The whole idea that FOSS doesn't make money is hooey and FUD. Same with Ubuntu. How does Canonical pay their employees? I'm sorry, but just how did the creator of BitTorrent lose his perspective on things? I'm sure the record companies are dangling poison carrots.

Anonymous
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IA
I have a feeling the next version of uTorrent will be ad supported and it will slowly move to obscurity as other clients take over...

knightmb
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Re: It was so easy to see...

said by Anonymous See Profile :

I have a feeling the next version of uTorrent will be ad supported and it will slowly move to obscurity as other clients take over...
It might, but is there already a lot of open source projects that work just like BT and uT? Seems those would be where everyone would gravitate to.
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patcat88

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Re: It was so easy to see...

said by knightmb See Profile :

It might, but is there already a lot of open source projects that work just like BT and uT? Seems those would be where everyone would gravitate to.
You must mean the BitTorrent competitors Vuze?
emptywig
Huh? What?
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said by furionbr See Profile :

Still, they own uTorrent, the world's most used BitTorrent client. It is something...
What is it, though? Its a free product. Not exactly the kind of thing that is going to make the register ring.

These kids need to realize that businesses are about SELLING THINGS, not giving them away.

wig
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P Ness
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LOL get a great lawyer

and start the lawsuits rolling on the program....

hey they can even sue the big guys like blizzard....

but then again "creator" is how lax of a term?
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It couldn't happen to nicer folks, damn.

Over time, I've met some of their staff on line and a few in person -- these are people that love the Internet and now is a very rough time for anyone to lose a job.

My friend Eric accurately points out that streaming over the Internet -- ala YouTube -- cannot possibly replace traditional TV delivery (broadcasting) because it's incredibly inefficient (and thus prohibitively expensive) to ship so many unicast streams from a source to millions of viewing end hosts.

BitTorrent -- which is here now and works -- can take us a lot farther to freeing us from our TV overlords. Solutions like BitTorrent DNA, which can support broadcasting live events as well as pre-recorded content, moves to solve that problem by creating millions of free CDNs among the watchers.

This is identical to what Pando is trying to do, but their closed proprietary system has never gained much interest and their endless trials of P4P might end up in user code about the time we're all flying around in jet packs.

For those that are going -- my sincere admiration and wishes go with you. For those that are staying, let's hope that today's economy drives more content providers toward looking at P2P solutions to help offset costs and inefficiencies of client-server and traditional CDNs.
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edit:
November 8th, @09:17PM

Re: It couldn't happen to nicer folks, damn.

said by funchords See Profile :

...moves to solve that problem by creating millions of free CDNs among the watchers.
"Free" is a myth. Bandwidth is NOT "free". Perhaps this substantially and materially shifts the bandwidth ISP costs of content distribution away from Internet video sources, but it is far from "free."

All this does is move the cost of bandwidth to the consumer ISP which "we" pay for vs having content providers pay their cost of bandwidth.

funchords
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Re: It couldn't happen to nicer folks, damn.

said by devnuller See Profile :

All this does is move the cost of bandwidth to the consumer ISP which "we" pay for vs having content providers pay their cost of bandwidth.
It's not just free, it's saving them money. By using or partially using P2P for distribution, users are reducing the traffic traversing an ISP's 3rd-party transit gateways and lowering the traffic on any congested internal links between towns.
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edit:
November 9th, @07:37PM

Re: It couldn't happen to nicer folks, damn.

Note: 3rd-party exchange points make up only 1 small part of end to end network costs. Those savings are small and not a major factor.

Question #1: Who is saying P2P "saves" them (ISPs) much money?
Answer: Not the ISPs

Question #2: As P2P content distribution really is nearly "free" for CDN/Content providers, what happens around costs for the ISP when an 3rd party can NOW deliver 100x's the content for no capital or BW costs for CDN? As that cost has shifted to the consumer ISP, who is the new "them" that has to pay for it?
Answer: the consumer (me and you).

Content wants a free ride by moving their capital costs to you and me (systems, power, space) and their bandwidth costs to the the ISP (and in turn their customers).

Internet bandwidth today is "paid" for by both content and consumers. P2P shifts all the cost to the consumer side of the network. Don't be fooled. This is one of those, "be careful what you wish for, you just may get it."

funchords
Robb Topolski
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Re: It couldn't happen to nicer folks, damn.

Except for those who provide content for the love of it, we pay for all of the transit. The content provider extracts money from "us" one way or another, either directly or from the advertisers who get money from us.

Question #1: Who is saying P2P "saves" them (ISPs) much money?
Answer: Not the ISPs
True. The ISPs don't (or didn't) understand P2P. Some of them are coming around. Keep in mind that our ISPs are the Phone Company and the Cable Company. They didn't invent it, so all they see is "traffic" (and a lot of it), and they don't understand how the technology works. I'm telling you it's saving money, yet they'll say it's costing money. (They incorrectly think if P2P stops that the demand for the video or music will stop.)

Question #2: As P2P content distribution really is nearly "free" for CDN/Content providers, what happens around costs for the ISP when an 3rd party can NOW deliver 100x's the content for no capital or BW costs for CDN? As that cost has shifted to the consumer ISP, who is the new "them" that has to pay for it?
Answer: the consumer (me and you).
Even if its coming from a CDN, it's coming across that gateway that they're paying for. So if P2P reduces that (or can prevent them from having to expand so quickly), it can save them some dough.
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edit:
November 10th, @09:23AM

Re: It couldn't happen to nicer folks, damn.

said by funchords See Profile :

I'm telling you it's saving money, yet they'll say it's costing money.
Again, who saves? Do you have any data which shows p2p saves me money? Yes I can serve some content, but I could before without p2p. There are plenty of sites like youtube, flicker, etc for my content. What worries me is the Trojan horse the content folks are putting in.

As far as you claiming it saves ISPs money, be sure to factor in all network costs and not just small cross connect exchange point costs. Factor in any increased upstream needs, capital, etc. Also factor in increase in content BW as CDN moves to P2P. (as described in my Question #2 which you really didn't address)

said by funchords See Profile :

Even if its coming from a CDN, it's coming across that gateway that they're paying for. So if P2P reduces that (or can prevent them from having to expand so quickly), it can save them some dough.
YES!! It saves the CDN or content provider dough. Be clear on who saves (not you, I or the ISP we purchase from). In today's world CDN and content providers pay for the exchange point traffic. Today, they pay for their side of the Internet costs.

In a P2P world this becomes "free" to them allowing for double, triple, 10x, 100x increase in content distribution with the BW cost shift from them, to the ISP, you and I.

I see how P2P is good for content, but what people fail to realize is the cost does not disappear. It just shifts to you and I. "Free" does not exist as BW growth always has cost. It should be replaced with "Shifts" and you should wonder to who.

We all want high quality bandwidth services, but allowing content to shift their cost of this all to us may not be the best solution.

funchords
Robb Topolski
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Re: It couldn't happen to nicer folks, damn.

Sorry that I blew off your question, it was a good one.
Question #2: As P2P content distribution really is nearly "free" for CDN/Content providers, what happens around costs for the ISP when an 3rd party can NOW deliver 100x's the content for no capital or BW costs for CDN? As that cost has shifted to the consumer ISP, who is the new "them" that has to pay for it?
Answer: the consumer (me and you).
It doesn't really work that way, because content is PULLed (or fetched, or requested) on the Internet. It's not PUSHed (broadcast into the ether, perhaps with no viewers). So even though a distributor can deliver 100x more with P2P, it won't push one more byte than it did before unless someone out there wants to see it.

If we can get the advertiser out of the loop, and supplement the delivery with P2P, the content will be net cheaper for us (the consumer) as there will be fewer middlemen.

Despite all the handwaving, the shift to video and the P2P experience has not caused bandwidth growth to break out into faster growth rates. The year-after-year growth rates have been rather constant, if not down a bit. But that said, there is a cost concern -- and I won't insult your intelligence by pretending there is none. If we were to have a sudden shift to P2P, we could hit the ISPs really hard -- not because of gateway costs but perhaps in last-mile upload capability costs.

What worries me is the Trojan horse the content folks are putting in.
Interesting. What do you mean?

Again, who saves?
At the moment, I agree that the savings are not very apparent. Most P2P is of the infringing-type, which is easy to dismiss as "ought not to be happening anyway" (which is beside the point, what will consumers REPLACE it with?). For that reason, hard data is hard to come by save from that which can come from an Einsteinian "thought experiment" (it just figures out correctly).

The P4P WG's results -- whether overstated or not -- have to be seen in some context, though. That's good because thinking about whether P4P saves ISPs transit costs causes one to realize how and why P2P already has some efficiency over client-server: Every chunk not transferred over someone else's backbone is money saved.
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devnuller

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Re: It couldn't happen to nicer folks, damn.

said by funchords See Profile :

It doesn't really work that way, because content is PULLed (or fetched, or requested) on the Internet.
What is different is the amount / fidelity of the content and who pays for the cost to distribut it. With P2P the user pays for the hard drive space and power and the ISP pays for the network (passed back to the user). Content companies like WoW, etc get a free ride. Sounds good to some, but not necessarily fair.

The P4P WG's results -- whether overstated or not -- have to be seen in some context, though. That's good because thinking about whether P4P saves ISPs transit costs causes one to realize how and why P2P already has some efficiency over client-server: Every chunk not transferred over someone else's backbone is money saved.
I think we need to look at the end to end costs as one breaks apart this complex savings analysis. Say 20% of network costs are backbone/exchange point and 80% are metro and last mile. Would a broadband ISP be well served to save a portion of that 20% only to enable 10-100x of increase in growth on the 80% capital intensive portion of their network? I think the economics are not fully baked yet.

I, the P2P using customer, have enabled that "free" growth in content / fidelity using a portion of my power, CPU cycles and the ISP now wants to pass the bandwidth costs back to me with usage elements... The content provider saves 10's of millions by shifting the cost.

I have yet to see a real analysis of this. Content keeps calling this "free" bandwidth and ISPs worry about the cost shift impact which has some merit. I'd rather the content ISP and CDN pay for their distribution vs. passing it on to me. Everyone should pay their fair share of Internet bandwidth costs.

Just because 1 party saves, does not mean everyone saves in the long run. More to think about.
battleop

join:2005-09-28
00000

Wow

Who would have ever thought that this would happen. The majority of BitTorrent users are using it to get FREE stuff. What ever thought that these same people looking to get Free (steal) stuff would just start paying out of loyalty to BitTorrent?

TK Junk Mail
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Re: Wow

said by battleop See Profile :

Who would have ever thought that this would happen. The majority of BitTorrent users are using it to get FREE stuff. What ever thought that these same people looking to get Free (steal) stuff would just start paying out of loyalty to BitTorrent?
Yes. BitTorrent made its name and reputation catering to the copyright infringers who want everything for free. I think it is poetic justice that they are suffering now that they want to cash in from the businesses they helped harm.
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Re: Wow

Last time I heard, the BitTorrent company itself made money selling legally licensed music. Not Illegal/free by any means. And BT is a TECHNOLOGY, a TOOL. Every tool has harmful/dangerous uses. To blame that on the tool's creators is akin to blaming Boeing for 9/11, or blaming Einstein for the widespread fear of nukes. It's an old, dog-eared, half-a$$ed argument that has been defeated many times, so I hate to say this TK, but you're starting to sound like a broken (corporate) record.....

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Re: Wow

said by a333 See Profile :

so I hate to say this TK, but you're starting to sound like a broken (corporate) record.....
Starting??? He's always sounded like a broken (corporate) record.
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said by battleop See Profile :

Who would have ever thought that this would happen. The majority of BitTorrent users are using it to get FREE stuff. What ever thought that these same people looking to get Free (steal) stuff would just start paying out of loyalty to BitTorrent?
Copying is not "steal"-ing.
Nothing is ever removed from the owners possession.
It *IS* Copyright Infringement - which is illegal, but it is not stealing.

Call it what it is...

There are many free - even Open Source, BT clients out there to be had.
Does this mean the Open Source people are facilitating stealing Infringement?
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TK Junk Mail
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Re: Wow

said by dadkins See Profile :

There are many free - even Open Source, BT clients out there to be had.
Does this mean the Open Source people are facilitating stealing Infringement?
YES!

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Re: Wow

said by TK Junk Mail See Profile :

said by dadkins See Profile :

There are many free - even Open Source, BT clients out there to be had.
Does this mean the Open Source people are facilitating stealing Infringement?
YES!
Put your money where your mount is. I am using Open Source software and I use BT to help distribute it. What exactly am I doing to facilitate any form of copyright infringement??

And no I am not going to trackers like TPB and downloading copyrighted stuff.
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TK Junk Mail
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Re: Wow

said by Zaber See Profile :

said by TK Junk Mail See Profile :

said by dadkins See Profile :

There are many free - even Open Source, BT clients out there to be had.
Does this mean the Open Source people are facilitating stealing Infringement?
YES!
I am using Open Source software and I use BT to help distribute it. What exactly am I doing to facilitate any form of copyright infringement??
Are you authoring P2P code? No, you are using it. So you missed the point of the post about those who are WRITING P2P clients are facilitating infringement.
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Re: Wow

said by TK Junk Mail See Profile :

those who are WRITING P2P clients are facilitating infringement.
TK, you've got to be kidding me. That's akin to saying gun manufacturers are responsible for gun related deaths.
battleop

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Re: Wow

"That's akin to saying gun manufacturers are responsible for gun related deaths."

Not so fast on that analogy. Obama and Biden Voted NO on prohibiting lawsuits against gun manufacturers in 2005.
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Re: Wow

said by battleop See Profile :

Not so fast on that analogy. Obama and Biden Voted NO on prohibiting lawsuits against gun manufacturers in 2005.
Wow, you took that WAY out of context. Nowhere did it say that they could be sued for selling an item used to harm others. That was only put in place so that lawsuits could be brought against gun dealers doing illicit things... intentionally selling weapons to people with criminal records, selling illegal weapons, etc.

You cannot sue a gun distributor because they sell items that COULD cause harm to people. Don't believe me? Try it for yourself. Doubt you will get very far.
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See 6 replies to this post

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said by TK Junk Mail See Profile :

Are you authoring P2P code? No, you are using it. So you missed the point of the post about those who are WRITING P2P clients are facilitating infringement.
The post you replied to said nothing about authoring anything. I would consider myself an Open source Person, not only because I use OSS I also help distribute and support it.

By your "logic" GM is responsible every time one of their products is used in a crime, or Glock is responsible every time someone gets shot with one of their firearms.

BT is a tool, like a car or a gun, it can be used to serve good or to cause harm. BT's purpose is to transfer a large amount to data to end users while creating minimal overhead for the distributor of said data.

Finally I will ask again: What exactly do OSS people do to facilitate infringement?
--
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NetAdmin

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said by TK Junk Mail See Profile :

Are you authoring P2P code? No, you are using it. So you missed the point of the post about those who are WRITING P2P clients are facilitating infringement.
So axe manufacturers facilitate axe murders ? Knife manufacturers facilitate stabbings ? Toothbrush manufacturers facilitate people getting shived in prison ? Gun manufacturers facilitate gun crimes ? Car manufacturers facilitate car jackings ?

Come on... The only people who facilitate copyright infringement are people who actively do it. The coders created a tool and it is a fact that tools can be used the wrong way.
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If P2P technology, or specifically even BitTorrent clients, only had a single use to facilitate copyright infringement - I might sort of agree with you. However, that is not the case by any stretch. That would be like blaming the US Postal Service for delivering packages which happen to contain photocopies I made of a popular best seller and mailed to various people that I know around the country.

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edit:
November 8th, @01:07PM

said by Zaber See Profile :

said by TK Junk Mail See Profile :

said by dadkins See Profile :

There are many free - even Open Source, BT clients out there to be had.
Does this mean the Open Source people are facilitating stealing Infringement?
YES!
Put your money where your mount is. I am using Open Source software and I use BT to help distribute it. What exactly am I doing to facilitate any form of copyright infringement??

It's best not to get into any sort of debate with resident corporate shills, particularly as it concerns the MAFIAA. They always come unarmed to the battle.
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Do you believe that open source advocates are purposely facilitating copyright infringement?

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dadkins See Profile

pleaseeee

Nope, the strong will survive aka the freebies... people will move elsewhere to other bittorrent clients or other sharing techniques. There is no way to stop something from being shared on the internet. That is what it's DESIGNED for, sharing information. That's the whole purpose of it. The correct term is copyright infringement, not stealing. For a handy guide on this subject I will refer you to this link->>>> »i38.tinypic.com/2gsq5a8.jpg . And for those of you who say it hurts the artist... pleaseeee, The most it will do is help spread the word that you're a musician and it will get people interested in your music so you can perform live shows, sell merchandise etc.. etc.

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(topic offline) TK Junkposts

Moderator Action
This entire topic was removed, either temporarily, or permanently.

stated reason was: flamefest

dvd536
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Want to make money?

Look at what the pirate sites AREN'T doing.
the pirate sites AREN'T using low encode rates
the pirate sites AREN'T putting in adware
the pirate sites AREN'T putting DRM in the content.
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Re: Want to make money?

said by dvd536 See Profile :

Look at what the pirate sites AREN'T doing.
the pirate sites AREN'T using low encode rates
the pirate sites AREN'T putting in adware
the pirate sites AREN'T putting DRM in the content.
He was a good programmer with a great idea but a moron otherwise.
He could have been stinking rich and loved but he for some insane reason decided to do everything with it people hate.

Every other person could see where stuff like drm was headed but he totally ignored it.

He should have watched jobs and taken his lead from there but no he thought he was some business genius and destroyed it all by himself.
chronoss2009

join:2008-09-23

how to rid yourself of utorrent

A) get linux and rtorrent
B) get cygwin and change the parsing in said make files , down the libraries install via changing again parsing in make files and use rtorrent on windows.
C) use deluge ( windows and linux )
D) go back to A)

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join:2007-12-26
Laguna Hills, CA

Must suck having everyone leech off yer creation...

eh Bram?

pnh102
Reptiles Are Cuddly And Pretty
Premium
join:2002-05-02
Mount Airy, MD

Re: Must suck having everyone leech off yer creation...

Didn't the company that created Kazaa have a similar problem with Kazaa Lite?
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Reptiles Are Cuddly And Pretty

pnh102
Reptiles Are Cuddly And Pretty
Premium
join:2002-05-02
Mount Airy, MD

Idiots

They should have asked for a taxpayer financed bailout!
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Reptiles Are Cuddly And Pretty

S_engineer

join:2007-05-16
Chicago, IL

Re: Idiots

Why, if they got it, it would have only been used to pay themselves bonuses!

pnh102
Reptiles Are Cuddly And Pretty
Premium
join:2002-05-02
Mount Airy, MD

Re: Idiots

said by S_engineer See Profile :

Why, if they got it, it would have only been used to pay themselves bonuses!
I don't get why people are surprised that the bailout went to pay executive bonuses. The companies that we bailed out are contractually obligated to pay out these bonuses. Should any company renege, the executive in question could simply sue the company and would easily win in court. The only way a company could get out of this obligation would be for the company to declare bankruptcy.

Gotta love the unintended consequences (or were they?) of the Sovietization of our economy! A better approach would have been to simply let the companies die off like they should have in the very beginning. We already saw the stock market tank even with the bailout. I don't see how not bailing out would have made any difference.
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Reptiles Are Cuddly And Pretty

S_engineer

join:2007-05-16
Chicago, IL

Re: Idiots

you miss the point...yes they are contractually obligated, but those obligations should be null and void if the tax payers contributing. This should be no different than a bankrupt company seeking to renegotiate collective bargaining agreements. As far as the "sovietization" goes...I agree we should have let them dissolve. I think we've made it worse because we're paying billions to postpone the inevitable.
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"For duty and humanity!"
- Moe Larry and Curly (MEN IN BLACK, 1934)...These are the guys we have in Congress

pnh102
Reptiles Are Cuddly And Pretty
Premium
join:2002-05-02
Mount Airy, MD

Re: Idiots

said by S_engineer See Profile :

... but those obligations should be null and void if the tax payers co