1. Center for Information and Communication Technologies Potentials and Challenges of Peer-to-Peer Technology Copenhagen, December 2, 2005 Halldor Matthias Sigurdsson (halldor@cict.dtu.dk)

2. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 2 Motivation  Or a chest of gold for those who can master it? There seem to be two dominant views about peer-to-peer technology  Is it the open sea for the pirates?

3. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 3 Motivation Both are wrong  Peer-to-Peer technology is an ALTERNATIVE, which is and will be used when feasible

4. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 4 Introduction  Peer-to-Peer: What, why, where  Economic Analysis of P2P Networks  SWOT (Strengths, Weaknesses, Opportunities, Threats) of P2P  Business and revenue models in P2P  The current status and future of P2P  Analysis of Skype  Proposal of a new service

5. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 5 Peer-to-Peer Networks STREAMING SERVER ISP1ISP2ISPN... PEERS... PEERS... PEERS BACKBONE NETWORK ISP1ISP2ISPN... PEERS... PEERS... PEERS BACKBONE NETWORK Client / ServerPeer-to-Peer Have traditionally suffered from being:  Single point of failure  Resource Demanding  Does not scale well  Congestion prone Have traditionally suffered from being  Uncontrollable  Illegal content  Unreliable  low quality

6. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 6 Key Design Issues Centralised Peer Decentralised Peer Hybrid Peer Signalling Content

7. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 7 Development of P2P Networks Nerds Mainstream 1st Era2nd Era3rd Era4th Era Period1999-20012000-20022002-2004Recent trends ArchitectureCentralisedDecentralisedHybrid FunctionalityMainly file- sharing File-sharing, Messaging File-sharing, IM, VoIP, Games Dominant ApplicationNapsterGnutella, KaZaa BitTorrent, MSN Skype, Avalanche, PodCasting

8. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 8 Economic Analysis Joy of content Incentive Price of content Opportunity cost Revenue Incentive OPEX CAPEX Licence fee Operator Utility Peer Utility Peers and Operators have utility functions that they try to maximise

9. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 9 Case of file-sharing Joy of content Price of content Opportunity cost Peer-to-Peer Utility Peers will continue sharing, while there is no other alternative that gives higher utility Joy of content Price of content Client / Server Utility

10. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 10 SWOT SWOT Analysis of Peer-to-Peer Technology StrengthsWeaknesses  Abundance of cheap resources  Natural Scalability  Self organising / maintaining  Network redundancy  Driver for broadband  Security and Authentication  Peer heterogeneity and instability  Lack of successful business models  Expensive inter-domain traffic  Lack of incentive mechanism OpportunitiesThreats  Inexpensive infrastructure  Development and new services  Lowers barriers to entry  Illegal content  Security  Stability / Redundancy / QoS  Asymmetrical benefits (e.g. between customers and ISPs)

11. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 11 Future Applications Super Nodes Clients Server P2P will become a competing transmission technology Application Domain: File-sharing and downloading Streaming content / VoD On-line Gaming Telecommunication Video-conferencing Cooperative working

12. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 12 Skype Super Nodes Clients Server What is so special about Skype: Worth $ 2.5 billion to begin with easy, good quality and free 50 million registered users Scalable and no infrastructure

13. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 13 New Service Idea 12 3 45 6 78 9 Empirical Study Period1 April 2005 - 30 April 2005 No Successful Requests 476.295 Transmitted bites4,70 Tb CurrentTrad.SIP2P Rate240 Kb2 Mb Relative TCO 18,30,9

14. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 14 How does it work? STREAMING SERVER ISP1ISP2ISPN... PEERS... PEERS... PEERS BACKBONE NETWORK 12 3 45 6 78 9

15. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 15 Conclusion  P2P is becoming mainstream and being incorporated into an increasing number of applications  P2P has to consider all members of the value chain to be successful  P2P offers great opportunities of increased efficiency, development and can reduce barrier to entry  Peer-to-Peer technology is an ALTERNATIVE, which is and will be used when feasible

16. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 16 Questions ? For questions or comments Please feel free to contact halldor@cict.dtu.dk

17. Center for Information and Communication Technologies Potentials and challanges of peer-to-peer Page 17 Conceptual Model SERVICE LAYER CONNECTIVITY LAYER ACCESS LAYER SEEDING SERVER ACCOUNTING SERVER META SERVER DRM SERVER ISP SUPER NODE SUPER NODE SUPER NODE... PEERS... PEERS... PEERS MANAGEMENT BACKBONE NETWORK  Seeding Server  Accounting Server  DRM Server  Meta Server  Future Multimedia Framework  Legal Content  SIP2P competes  Why use SIP2P?