Asked about digital piracy, King emailed Motoko Rich of the New York Times:

The question is, how much time and energy do I want to spend chasing these guys. And to what end? My sense is that most of them live in basements floored with carpeting remnants, living on Funions and discount beer.

Or reading novels by Cory Doctorow, the Boing Boing blogger with a little-known sideline in fiction. Doctorow doesn't mind if you copy his books — in fact, he gives them away. To guys living in basements floored with carpeting remnants, living on Funions and discount beer.

Gottfrid Svartholm Warg, Peter Sunde, Fredrik Neij and Carl Lundstrom have been on trial in Sweden for months. A court in Stockholm, Sweden, returned its verdict today: guilty, with a year in jail and $3.6 million in fines owed to artists whose works they helped Pirate Bay users copy.

Sunde, the group's spokesman, has been joking about the outcome since it was announced, claiming he "pirated" the verdict by announcing it on Twitter before the court published it. He's since released a video comparing his opponents — the world's big record labels — to bullies, and claiming that he found the jail sentence "a bit surprising."

Mike Masnick at Techdirt takes a typical blogosphere tack: This is a "lost opportunity" for the music industry which sued The Pirate Bay, and questions why Sunde and his companions should be punished for providing a "tool" which can be used for good or bad. It's the kind of sloppy thinking which seems to spread like an MP3 on BitTorrent: Should you be let off scot free for swinging a hammer at someone's head just because you can also use it to hammer a nail?

There are surely arguments to be made for file sharing. But The Pirate Bay Four didn't make those arguments. Instead, they spent most of their time in and out of court on jokey gestures, trying to pretend that the case was too ridiculous to take seriously — theatrics that their online fans ate up.

People will still share files after this verdict. If The Pirate Bay shuts down, new servers will spring up. But can we give up the pretense that just because it's easy, it's legal?

Navin wasted years and millions of dollars trying to turn BitTorrent Inc. into a competitor to Apple's iTunes store. He struck splashy deals with Hollywood studios by paying them large upfront guarantees, which depleted BitTorrent's bank account but got Navin into the right parties. Meanwhile, BitTorrent's other line of business, which used file-sharing technologies to deliver content more efficiently for corporate customers, suffered from lack of focus, and more established competitors like Akamai moved in. Sometimes losing a founder is bad for a company. In this case, it's nothing but good.

Sequoia, which recently summoned the CEOs of startups it invests in to an emergency meeting and told them to cut costs, is doing the same with its own portfolio. Rather than continuing to invest in the losers, it's culling the herd now. This despite the fact it just raised $1.7 billion in new funds — money that's destined for new ideas, not old ones.

AlwaysOn founder Tony Perkins, my old boss at the Red Herring, has a trenchant analysis of Sequoia's message to entrepreneurs, disguised only thinly as satire. His point, as a longtime observer of Sequoia, is that the venture capital firm's sudden panic is as much about its partners' losing face in front of their investors — the endowments, pension funds, and wealthy individuals from which they raise funds. Appearances matter, now more than ever. And if keeping up appearances means dropping a company? Sequoia's newly hungry partners will do it in a heartbeat.

• Biden this year "proposed a $1 billion program to monitor P2P networks for “illegal activity” and a version made it through Judiciary."
• Last year, Biden sponsored an RIAA bill designed to limit the recording and playback of individual songs from Satellite and Internet radio stations.
• Biden "urged the Justice Department to prosecute individuals who allowed mass-copying intentionally through P2P."

Pirates are providing the highest-quality viewing experience for video-on-demand, with events being posted in HD even before they air on tape-delayed TV broadcasts in the United States. Torrents of the opening ceremonies, including a giant 5-gigabyte download of all four hours in HD, proved the most popular television programming available on file-sharing networks this week. And while event organizers and network operatives continue to play whack-a-mole with illegitimate live streams, where there's a will, there's a way on the Web. Want to know where to look? Check out our handy guide.

Online schedules: NBC's Olympics listings takes a bit of work (you have to enter your ZIP code and select a television provider, even if you just want online listings). However, once you've done the work, it'll send you notifications when events you've selected will be broadcast. Jason Kottke has found Google and iCal calendars, which will allow you a bit more flexibility in setting up alerts, and the New York Times has a schedule as well. And of course, there's an official schedule from the organizers in China, with times listed for Beijing's time zone (16 hours ahead of San Francisco, 13 hours ahead of New York) — probably the best place to go for daily updates, as smog and weather may upset the schedule.

Sling Media's Slingbox: For those with more money than time, the best solution might be a Slingbox. Then you can beam your home satellite or cable signal over the Internet to your laptop, desktop, or iPhone, and remotely switch between NBC and MSNBC.
Pros: You can get great quality, even HD, if your home Internet connection is fast. There is SlingPlayer software available for a range of not just operating systems but handheld devices as well.
Cons: Prices start at $129.99 and your selection of Olympics coverage is limited to what's available from your satellite or cable provider, which means missing early heats and niche events and having to put up with tape delays by the networks.

International proxies: It is possible to watch live streams from other countries, such as BBC Sports from the UK or CBC Sports from Canada, by configuring your browser to run through an anonymous proxy. I recommend using Mozilla's Firefox browser with the FoxyProxy add-on installed. Xroxy has a handy list of proxies which you can sort by country to find proxies in the UK or Canada — which must be anonymous, and preferrably running the SOCKS protocol. Your best bet is to get a geeky British or Canadian friend to install a proxy on their machine for you and your Yankee friends. The latency can be frustrating, but once you get a stream started it will work fine.
Pros: Quality streams from legitimate providers, and if you're accustomed to jingoistic U.S. coverage, the charming accents from the Beeb's announcers and the humble mien of the Canadians can be quite refreshing.
Cons: Takes some technical know-how to set up, and proxies come and go. You might miss an event because you're too busy fiddling with your settings or a proxy fails when too many people sign on.

Video on demand: If you're running Windows Vista, you can download events using TVTonic for "Olympics on the Go." Torrent client Azureus works on any system to help download events after the fact, especially the most popular ones like tennis, football, boxing and basketball — Torrentz cross-site search of multiple BitTorrent indexes should make it easy to find the Spain versus China women's basketball game you might miss tomorrow. YouTube's official channel is blocked — even using international proxies — though a reader came up with a crack that works for now. Other less thoroughly policed online video sites like Veoh, Metacafe, Dailymotion and Megavideo will also have videos.
Pros: Torrents will be high quality and work for anyone, while video-sharing sites will be easiest to use.
Cons: Nothing will be live, obviously, and no one knows how long video clips will remain on sharing sites.

P2P Streams: The way I'll be watching online will is through MyP2P, a site that catalogs live sports and television streams from around the Web, listed by event. It helps to run Windows, though not necessarily Vista, because many streams require software downloads — check out MyP2P's beginners guide for tips, including where to find software downloads and optimization settings. I ended up finding live BBC coverage of the opening ceremonies via Justin.tv, which ran just fine in my browser. If you can't find the channel you want in the media format you prefer, check wwiTV, TV For Us, TV Channels Free, Channel Chooser or BeelineTV among others.
Pros: Free and fairly easy once you've installed most of the media players listed by MyP2P. And it's fun to watch coverage from other countries — I'll be watching all my football with spanish-speaking announcers whenever possible.
Cons: Quality is hit-or-miss, stream links come and go, and you have to think ahead in terms of scheduling to make sure you've got all the necessary programs installed. Also, Mac users will want to install Windows XP through Parallels or Fusion for the widest selection of channels.

That's the second time I've heard that phrase from BitTorrent tipsters, so I'm guessing it's already widely used, if poorly understood, within the company. Anyone care to explain what an "Internet peace corps" is — and how this plan will pay back BitTorrent's investors, who have invested at least $24 million in the company? Our tipster also says Walker's trying to raise a third round of financing amidst this uproar. Here's his detailed recounting of BitTorrent's woes:

Owen-

I read your posts on BitTorrent and here is my take (you can guess as to whether I'm an insider or not).

I feel it boils down to two young and inexperienced founders, one a wanna-be Internet celebrity in Ashwin Navin, the other a reluctant Internet celebrity in Bram Cohen, wielding too much power over the company. They executed a coup that doesn't bode well for the new CEO staying much longer. Sound familiar?

Torrent Entertainment Network

Ashwin's grand idea that new CEO Doug Walker put the kibosh on may very well end up being sold to Best Buy, but nowhere near $15M (unless BitTorrent is incredibly lucky or Best Buy foolish). Best Buy's idea is to OEM a white box set-top TV box, put the Best Buy logo on it and bundle it with BitTorrent to download the content. This is what Ashwin dreamed of...sort of to do for movies what iTunes did for music; a seamless end to end solution for renting and buying movies online. Its just been poorly executed and with Apple TV nearing perfection, TEN will be an albatross with whoever ends up with it. BitTorrent is on the hook for licensing deals (that Ashwin's brother Alvir put together) that were not favorable to the company at all, especially since the store has not done well with consumers. Apple has more leverage here too. You've probably already heard the nightmares TEN has had with Windows DRM so I won't rehash it here.

SDK

Their SDK business was attractive to device manufacturers in part because of the ability to leverage the TEN. With TEN going away or at least changing dramatically, device manufacturers are not as excited to partner with BitTorrent. The FCC ruling that will likely force ISPs to cap bandwidth and charge for overage makes it that much worse. Why would Buffalo, D-Link, Netgear, etc want to bundle and pay royalties for the BitTorrent client on their device when their own consumers may end up having to pay more to their ISP for the behavior of that client passively sharing files? Talk about a tech support nightmare.

DNA

Probably the brightest part of their business, they had the model wrong. They were charging per GB to match CDN pricing schemes. What they should have done is given DNA away for free from the start and charge for the help and support people will end up needing (like what Red Hat did for Linux). Of course, BitTorrent had absolutely no post-sales support put together so even when the now laid-off sales and marketing team started to get traction in the market, supporting those customers became a headache. Not to mention that Eric Klinker and the engineering team had no desire to support what product marketing said customers were asking for. Mac client? Good luck...the engineer working on that left in May and they have no plans to pursue that project. Live streaming? Bram tried to figure this one out but gave up after becoming increasingly frustrated over not figuring out a way to make it work easily. Bundle the DNA client into the next release of uTorrent in order to propagate it? Too much of a sacred cow. They feel the uTorrent users would leave in droves if they were to do such a horrible thing as attempt to commercialize uTorrent. Seems like the solution here was to just let everyone in sales and marketing go to make the people causing these issues go away. At least they got to keep their laptops as a consolation gift.

So now Doug Walker is left trying to cobble together a C round of funding as they desperately cut expenses. They are not renewing the lease on Floor 9 of 201 Mission St in December (rumor is Google is interested in the space, as well as several other floors in 201 Mission). 40 people in an office with room for 150 never does well for morale. Word is they are going to go back into stealth mode, turning into an "internet Peace Corps"...whatever that means. To me it sounds like they are turning into a non-profit which can't be attractive to for-profit minded investors. I'd hate to be one of their VCs right now.

1. Set a limit on your upload speed so it doesn't interfere with downloads.
2. Set your client to use at most 60 connections total, 35 per torrent.
3. Don't try to download more than two items at a time.
4. I'll add: Configure your network router to not block any BitTorrent ports.

The problem for Comcast and other Internet service providers is that they can no longer block file-sharing traffic from their networks. And yet file-sharing usage is consuming more and more bandwidth, which they must pay for. Broadband providers are businesses, not charities. So they are increasingly considering charging their users by the bit for bandwidth over a certain level. Most users won't be affected, but file-sharing downloaders will be.

The prospect of pay-by-the-bit bandwidth had immediate consequences for BitTorrent's two main businesses: an online-media store delivered via file sharing, and a content-delivery network which competed with the likes of Akamai and Limelight Networks.

For users who would have to pay bandwidth fees to their ISPs on top of paying the usual charges, BitTorrent's Torrent Entertainment Network store would soon look uncompetitive with the likes of Apple's iTunes Store and Microsoft's Xbox Marketplace — which prompted Best Buy to back out of talks to acquire TEN for $15 million.

As for BitTorrent's content-delivery network, it was premised on the notion that BitTorrent would negotiate with ISPs to get privileged delivery for their file-sharing packets, while Comcast blocked others. With the FCC forcing Comcast to treat all file-sharing traffic equally, the promise of that business evaporated.

Which leaves BitTorrent with not much of a business. As the first Napster showed, peer-to-peer file sharing is easy to make popular — and surpassingly hard to make profitable. BitTorrent may have improved on Napster's technology. But it never solved the fundamental business problem.

What brought down Revision3's network wasn't the security hole, however. It was MediaDefender's response after Revision3 technicians noticed the breach and shut it down. MediaDefender's servers, in what that company told Louderback was an automated response, started trying to contact Revision3's servers through the now-closed hole. That turned into a flood of traffic that overwhelmed Revision3's network.

MediaDefender has worked for Sony Music, the Recording Industry Association of America, and the Motion Picture Association of America to shut down illegal file-sharing networks. But Revision3's use of file sharing for its own content was entirely legal; to the extent its servers pointed to any illegal files, it was only because of MediaDefender's hacking, Louderback tells me.

Revision3 has asked the FBI to investigate MediaDefender's alleged abuses. For years, the music and movie industries have been telling us that sharing files is criminal, and that blocking file-sharing networks is proper. For millions of file-sharing users, it would be quite satisfying to see the opposite proved in court.