When Verizon's chief technology officer Mark Wegleitner spoke at Telephony LIVE this month about the promise of peer-to-peer networking for on-demand video distribution, he acknowledged the irony of a longtime opponent of piracy embracing P2P video-on-demand.

“Peer-to-peer got somewhat of a bad name, but it isn't all bad,” Wegleitner said.

Most notably, however, he voiced interest in using subscriber set-top boxes (STBs) as nodes in the P2P system. A slew of vendors have proposed various P2P approaches in recent years, but the only one so far offering commercial STBs for the task is Vudu, whose products went on sale for the first time just last month. Putting STBs to work as VOD peers not only speeds downloads for users, Vudu said, it pushes cost and congestion out of carrier networks.

Vudu offers instant viewing of its 5000 movies but needs 2 Mb/s downstream links. Each box draws on other deployed boxes for content — the more boxes sold, the faster each box becomes. Initially, the company is relying on “fail-safe servers” for quick downloads. But the stand-alone STB model is tricky, said Bruce Leichtman, president of Leichtman Research Group. “The most successful stand-alone set-top of all time, TiVo, is only in about a million and a half homes. Consumers don't want a stand-alone set-top; they want it incorporated into the cable or satellite box.”

Reviews of Vudu's box have been mixed, according to Michael Wolf, analyst for ABI Research. It's fast but not cheap, starting at $400 per box. Vudu's per-movie “rental” prices are comparable to Blockbuster, he said, but unlike Blockbuster, Vudu rentals expire just hours after you start watching. Competition will come from VOD STB players such as Akimbo (funded partly by Cisco Systems and deployed by AT&T) as well as established P2P players; BitTorrent and Joost have both made recent overtures toward future moves in embedded consumer electronics.

In any case, both AT&T and Verizon look interested in finding the right model for P2P VOD. In late June, both carriers joined a mix of companies — including BitTorrent, Cisco and Pando Networks — in a working group of the Distributed Computing Industry Association focused on finding more efficient P2P architectures. The working group calls itself P4P.

“The goal of the working group is to optimize the various P2P protocols for the most efficient possible distribution of content rather than randomly selecting expensive hops and connecting ad hoc pockets,” said Marty Lafferty, CEO of the DCIA.

In a paper for the P4P working group, researchers from Yale and Washington University detailed a proposed P4P architecture, introducing “iTracker” portals that facilitate communication between P2P apps and networks, dividing control responsibilities between the two parties. Each iTracker would provide information on network aspects: status and topology, provider guidelines, and policies and network capabilities. The result, in theory, would be smarter choices regarding how network resources are used in P2P apps.

In a test of the system over AT&T's network, researchers cut download times by 45% and lowered traffic on network links by 70% compared to traditional P2P.

The P4P working group is just one part of the DCIA's efforts to evolve P2P for better and broader use by carriers, Lafferty said.