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Even though the Napster Inc. music-sharing system has gone the way of the LP, the basic approach that it took will be with us a long time and will affect businesses everywhere. The approach, known as peer-to-peer computing, lets computer users share information and files directly, without having to go through a central server. Even though Napster’s use of the idea was found to violate the copyrights of music companies, computer users have become accustomed to freedom in sharing information and will support other peer-to-peer approaches. Businesses themselves will find that the peer-to-peer model cuts costs by reducing demands on corporate networks and letting companies avoid administering some cumbersome centralized databases. Businesses also may find that peer-to-peer systems give them more flexibility to set up new work groups, both within their companies and in collaboration with corporate partners. The peer-to-peer concept already has disrupted not just the music industry but also any industry whose products can be turned into bits. Book publishing, movies, newspapers, magazines, and software all are under assault, because individuals are freely swapping material without paying anyone royalties. First-release movies, such as American Pie 2, are being pirated and traded on the Internet even before their widespread release in theaters. On a smaller scale, sheet music, needlepoint patterns, and digital art enterprises are feeling threatened. While Napster’s sharing system was shut down by the courts, the success of variants on its idea, such as Aimster (www.aimster.com) and Gnutella (www.gnutella.wego.com), shows how hard it will be to stop peer-to-peer swapping completely. Peer-to-peer systems could have a significant positive effect in data-intensive industries such as insurance and medicine, where managing the sheer volume of information on customers has proved daunting. Within medical groups, for example, patient records are often distributed among departments like scattered electronic scraps of notepaper, rather than collected into comprehensive electronic files shared by all. Combining all the databases into a single, unified one can be messy and expensive. A peer-to-peer system would allow files to remain with the department while still giving everyone in the practice access to all the information they need. Such a change not only would boost efficiency, it also would lead to higher-quality care for patients. Ray Ozzie, the developer of the Lotus Notes software, thinks he can deliver the benefits of the peer-to-peer approach to virtually any organization using software that helps individuals work better in groups and share documents, such as Notes or eRoom. Using a peer-to-peer architecture, Ozzie has created Groove Networks Inc. (www.groove.net) to provide a virtual version of shared office space while using fewer servers and less technology support than do corporate networks now. While most collaborative software allows people to share documents and view materials others post, Groove Networks takes the idea further. It lets people working on documents see changes simultaneously, conduct live voice chat, and use other team members’ tool sets. Shared files are updated on all team members’ machines as soon as one member makes a change. Files of members who are offline are updated as soon as they come online. Even better, the program circumvents the problem of firewalls, making it easier for people to collaborate even if they work in different organizations: at suppliers and clients, for example. A peer-to-peer approach also could give companies new ways of collecting payments. Today, telecommunications companies are pushing the idea of using a cellphone to buy goods from vending machines. But that introduces extra overhead, including the cost of the call from the cellphone. A peer-to-peer system would eliminate those additional costs; with short-range wireless technologies such as Bluetooth or 802.11b, a cellphone or another electronic device, such as a personal digital assistant, can talk directly to a vending machine and pay without having to go through a cellular network. It will take some time for the model to take hold: It took years for the corporate world to switch from a mainframe-based computing model, in which dumb terminals communicated with a central host, to the client-server model, in which mainframes and desktop computers shared the computing load. Beyond the issues of inertia, the peer-to-peer model has to overcome obstacles such as concerns about what happens to privacy when individuals start sharing information so freely. It isn’t clear just how peer-to-peer will unfold. Who could have guessed how quickly Napster would capture the public imagination? Still, the Internet provides the perfect mechanism for individuals’ computers to talk to each other, so the trend toward peer-to-peer sharing that Napster made popular will continue to spread like wildfire, even if the spark that ignited it has burnt out.
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