Joost: A New Web Venture

Niklas Zennstrom and Janus Friis made names for themselves as renegade Internet entrepreneurs by taking conventional tasks like talking on the phone or listening to music and giving consumers an unconventional — and free — way to do it.

Sometimes that meant pushing legal boundaries.

But with their latest creation, a Web video venture called Joost, Mr. Friis and Mr. Zennstrom, who were behind the file-sharing service Kazaa and the Internet telephone service Skype, are doing everything by the book. Revenue-sharing agreements have been signed. Licenses have been granted.

“The reason we’re doing this is because of our history,” Mr. Friis said in a telephone interview last week. “We know how these things work. And above all, we know that we don’t want to be in a long, multiyear litigation battle.”

The two men met in the late 1990s at Tele2, a European telecommunications company then emerging as a serious competitor to Sweden’s telephone monopoly. They left in 1999 to start their own Internet company.


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Soon after, they developed the technology behind Kazaa. The music industry fought Kazaa with the same fury that it fought Napster, another file-sharing service that was forced to become a legitimate pay service after lengthy court battles.

Mr. Friis, a Dane, and Mr. Zennstrom, a Swede, sold Kazaa in 2002, but their legal worries did not end there. Movie studios and recording companies pressed ahead with their lawsuits, and for years neither man set foot in the United States.

In November, Kazaa’s new owners settled the last of the lawsuits. In all, they have agreed to pay at least $125 million to the record industry and movie studios.

Today Mr. Friis and Mr. Zennstrom work out of Skype’s offices in the Soho neighborhood of London. Though they sold Skype to eBay for $2.6 billion in 2005, they remain active in the company. Mr. Zennstrom is Skype’s chief executive. Mr. Friis is the executive vice president for innovation, a job that has allowed him more time to spend developing Joost.

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