Boston Business Journal September 10, 2004

Groove Networks' P2P strikes the right note
Alexander Soule
Journal Staff

Beverly-based Groove Networks Inc. apparently is living up to its name. Since late last year, the company has been generating multiple contracts valued in excess of $1 million on a mostly monthly basis, according to marketing strategy guy Andrew Mahon.

Groove emerged in 2000 with peer-to-peer software to help organizations collaborate, just as music-swapping P2P pioneer Napster got a stern wake-up call for copyright infringement.

Systems from Groove, Napster and other companies bypass a hierarchical top-down, host-client architecture with a confederacy of nodes that share computer files.

In the commercial sector, perhaps the only P2P company to attract more attention than Groove has been U.K.-based Skype Technologies SA, which uses a P2P design to enable people to telephone each other over the Internet.

A few years ago, Groove's ballyhooed investment from Microsoft Corp. gave it instant credibility, but Mahon says its broad collaboration with Microsoft has become only a secondary sales channel for Groove. Instead, the company's work on the Homeland Security Information Network has won it renown and cash.

Groove is also lending its platform for use in other company's products, including Needham's Parametric Technology Corp., which integrates into its offerings Groove software to help engineers collaborate when using its mechanical-design software.

Massachusetts Institute of Technology spinout Oculus Technologies Corp. also is working to apply P2P technology to computer-aided design, but so far has not snared the mega-deals enjoyed by Groove.

Groove's latest multimillion-dollar deal came with the U.S. Army. Mahon said the Army has been using Groove's software on a trial basis -- now the Army Corps of Engineers will use it for projects it works on, at a cost of $4.1 million. The Army, meanwhile, is spending $1.2 million more on Groove to establish "battlefield knowledge centers" to help soldiers communicate.

That kind of success helps other new businesses with their own takes on the technology.

Los Angeles startup Atzio Technology, which this fall begins selling P2P software enabling users to share television shows over the Internet, saying it prevents slowdowns through use of a patented "data-swarming" software.

Israel's Belnsync's application uses the technology to allow remote workers to synchronize e-mail on multiple computers. Florida-based 312 Inc. just came out with a P2P remote backup application for small businesses.

Groove's commercial success has come even as the continuing saga of illegal music-file swapping has played out in another federal body: the courts. Last month, an appeals court ruled that Grokster, the Morpheus service offered by Streamcast Networks and other P2P programs, is not liable for copyright infringement based on the actions of its users.

Unlike Napster, Grokster and Streamcast do not own any servers to shepherd along files, making their networks truly decentralized. The court ruling set off a frantic effort by the music industry to sponsor a new law called the Induce Act that would halt such activity.

The U.S. Justice Dept. busted another P2P music-sharing network last month, with Attorney General John Ashcroft glibly telling reporters that P2P does not equate to "permission to pilfer."

They are working to dam up the most compelling concept in computing -- linking up a vast array of cheap desktop computers on the fly to enable extremely powerful networking and tasks only capable before with the most expensive machines.

That is partly what drew Hopkinton-based EMC Corp. to hire IBM Corp. inventor Jeffrey Nick to set its technology strategy for the future.

Nick's recent expertise is in grid computing -- not sharing files among innumerable computers, but rather, using the actual computing capacity in those machines to accomplish gargantuan tasks, such as the Search for Extraterrestrial Intelligence project where UFO-enthusiasts lend their computers in downtime to searching for radio signals from outer space.

Most people think of Napster as ground zero for P2P innovation, but as early as 1984, IBM used the term to describe its work on computer networks that lack defined clients and servers, instead using diverse peer nodes capable of initiating or completing network transactions.

No small wonder EMC would be interested in Nick: For years, academics at MIT and the University of California at Berkeley have been examining how to apply P2P technology to computer-storage demands through their Chord and Tapestry research projects.

And no small wonder EMC would want to push into the collaboration environment through its acquisition of Documentum Inc. and its eRoom Technology product created in Cambridge by Lotus Development Corp. founders Jeffrey Beir and Pito Salas.