Resnikoff’s Parting Shot: LimeWire Blood

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Here’s a riddle.

Why are the brains behind Kazaa – Niklas Zennstrom and Janus Friis – still worth billions and readying Rdio, while LimeWire founder Mark Gorton is potentially facing bankruptcy?  Why is Rdio getting all the hype, while LimeWire is getting eviscerated?

Once upon a time, Zennstrom and Friis couldn’t even enter the US because of label lawsuits, even while structuring their $2.6 billion sale of Skype.  Eventually, the duo shelled out a settlement chunk estimated at more than $100 million, medium-sized potatoes after the eBay purchase.  “We resolved the past,” Warner Music Group executive vice president of Digital Strategy Michael Nash recently told the New York Times. “These guys are focused on the future.”

But can Gorton “resolve the past” in a similar fashion?  Or, will Gorton’s body get dragged through the streets to set an example?  This time, things seem a bit different.  Label groups and publishers are out for blood, and if history offers any guide, Gorton will also be forced to launch a half-baked LimeWire remake.

And that’s too bad.  For starters, a filtered, legitimate LimeWire is almost an oxymoron.  This is an experiment that has been tried before with great failure.  Because no matter how well the app is retreaded, paid P2P is just fundamentally different than free P2P.

Just ask LimeWire.  They’ve been trying to develop their LimeWire Store for years.  And how’s that going?

The real solutions are more tricky.  Entrepreneurs rarely create concepts like Rdio with a gun pointed to their heads.  But how can the team that created one of the most popular P2P apps in history help to solve the modern-day monetization problem?  Is there a way for the industry to settle, and still keep the leash loose enough for future innovation?

Perhaps that is the more important riddle to answer after the legal dust settles.  Because Gorton and LimeWire are much more useful alive than dead.

Paul Resnikoff, Publisher.