I have always thought the amazing thing about p2p networks is the inability for them to be shut down as users connect with each other without the need for a centralized host. This week Grokster, the parent corporation who makes the p2p software was forced to shut down and while the company is in talks to sell their assets to a legal file sharing service to launch soon, they can’t stop users from continuing to use the service.

What they can do however is display a message to new users encouraging them to upgrade to a new version that may allow a few listens to a song before you have to pay.

The reason for the shut down of course is the Supreme Court ruling which also says the company has to pay $50 million to the Recording Industry of America.

People will still share files illegally of course by perhaps over time people will be encouraged to listen to music legally. For VoIP providers looking for alternative ways to generate revenue, streaming music and subsequently video are two such methods they employ. Teltel for example has a radio player built into their p2p SIP client.

Perhaps more people will listen to music via their VoIP software now that other p2p networks will have less of an incentive to launch new software and networks for illegal file sharing.

Either way, I expect Apple’s iTunes to benefit from this incident.

More:

AP: Grokster Downloading Service Shuts Down

WSJ: For Grokster, It's the Day the Music Died (paid registration required).