Global Economics

Riding the Download Wave on YouTorrent


The super-hot underground Web site lets users search many sources for fast movie downloads. Its founder may be swimming in legally murky waters

A swanky bistro in northwest London isn't the first place you'd expect to meet the young man behind a hot new underground Web site. (A punk club in Camden might be more fitting.) Yet there, next to Prada-wearing ladies-who-lunch sipping caramel lattes, sits a 22-year-old tech entrepreneur named Jon, sporting a scruffy beard and a well-worn beige jacket.

Most tech pioneers are eager to talk up their accomplishments. But Jon agreed to meet only if his full name and other identifying details weren't disclosed. His desire for anonymity is understandable: Jon's Internet site, called YouTorrent.com, helps Web surfers more easily find downloadable content such as music, movies, games, and software. While Jon believes his service is legal, given the aggressive prosecution of unlawful download sites by the entertainment industry he's erring on the side of caution.

He may have trouble staying out of the limelight much longer. Less than three months after YouTorrent went live, it has already spread like wildfire, attracting 2.7 million unique visitors in February who performed nearly 8.9 million content searches. Jon figures searches in March could top 11.3 million.

Telling You Where To Go

The premise is simple: YouTorrent indexes the vast array of digital content served up by 16 different speedy download sites known as torrents—a bit like a Google (GOOG) for peer-to-peer networks. Some of these sites, such as BitTorrent, the granddaddy of the category, now offer only legal content, while others are populated primarily with illegal copies of material.

Because YouTorrent doesn't link users directly to content, but merely tells them where to find it, Jon and his lawyer think the service passes legal muster. After all, it's also possible to find illegally copied material via Google, yet record companies and movie studios haven't tried to shut down the King of Search.

Hollywood still could pursue YouTorrent for aiding and abetting unlawful activity. That's the approach prosecutors used on the owners of a popular Swedish torrent called Piratebay, who have been charged with conspiracy to violate copyright. Legal experts say it's a murky area. "The issue of whether links to other peoples' content breaks the law is contentious," says Anne Borran, an expert in intellectual property law at the London School of Economics. Generally, she notes, providing links alone isn't seen by courts as evidence of copyright infringement.

Searches Across Multiple Sources

The idea for YouTorrent came to Jon—a computer science graduate from near Southampton in southern England—just after Christmas, when he was hunting around on the Net for a retro computer game. "I realized I was wasting a lot of time searching for torrents," he says, over a frothy hot chocolate. "There had to be a better way of doing this." Only a week later, after a series of late-night, caffeine-fueled coding sessions, the site was up and running.

What sets YouTorrent apart is that it's the first site to search across multiple sources of content. Whereas users previously had to jump from one torrent to another looking for the latest movie or fastest download, YouTorrent catalogs them all. Results are listed either by the number of "seeds" (the higher the figure, the quicker the download), or by date, file-size, or origin. Of course, YouTorrent doesn't host any content on its own computers, legal or otherwise.

A Front for the FBI?

Jon soon realized he was onto something, so he decided to give his service a name and throw open its doors to users. But it turned out somebody else already owned the domain name for YouTorrent, so Jon negotiated to buy it for $20,000—money he had earned from computer consulting jobs. Jon says it costs him about $500 per month to run YouTorrent. And so far, the site, which is free to use and carries no advertising, isn't generating any revenue.

Still, Jon says he's amazed by the rapid growth of YouTorrent, which has rapidly blossomed into an Internet movement. There are even rumors in the blogosphere that the site is a front for the FBI, which supposedly is using it to catch illegal downloaders in the act. Jon dismisses the idea as absurd.

The popularity of YouTorrent proves torrents are moving from being a niche product used by tech-savvy surfers to the mainstream of Net downloads. According to market watcher JupiterResearch, roughly 20% of Web surfers now use file-sharing sites, although senior analyst Ian Fogg reckons that's a conservative estimate because many users don't want to admit to their often illegal downloading activity. "The likelihood is that the number of consumers using file-sharing is much higher," he says.

Subtle Legal Distinctions

By tapping into this trend, YouTorrent has put a user-friendly face on technology most commonly associated with Internet piracy. Jon is adamant that YouTorrent doesn't condone the downloading of illegal material. It's easy, for instance, to restrict searches to 100% legal torrents. Jon also notes that some torrents mix legal and illegal material—making it impossible to tell whether users of those sites are breaking the law.

Such subtleties might be lost on Hollywood companies looking to stop illegal file downloads by any means. That's why Jon is staying underground, at least until some of the legal issues get sorted out.

In the meantime, he's looking for ways to improve the site, including creating custom feeds to other torrent sites that would make searching for files even faster. If everything goes according to plan, Jon also wants to expand into other media—particularly gaming—to make YouTorrent a one-stop shop for downloading torrent-based content. "My goal is to be in the top 100 most-visited sites on the Internet in two years," he says.

High Hopes for High Profits

Whether that happens depends on how music labels and movie studios react to the growth of downloads. Some industry observers see signs of warming, pointing in particular to the free, ad-supported Hulu online-video site launched last year by NBC Universal (GE) and News Corp. (NWS), which currently is in U.S. trials. Although Hulu has gotten off to a slow start, analysts say it's a sign major content providers are starting to embrace the Net.

Predictably, Jon's aspirations for YouTorrent are sky high. "If I can corner the torrent market," he says, "everyone would rely on the site for profits, just as people look to Google for search-based advertising revenue." Immodest, perhaps, but if he can steer clear of prosecutors, this young British entrepreneur may just be onto something.


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