• by Gavin O'Malley  @mp_gavin, October 30, 2007

LiveStation, the peer-to-peer Web TV service being readied by Microsoft and Skinkers, a British software developer, has received a boost in the form of a $16 million investment.

The funding--being provided by Acacia Capital, Spark Ventures and internal management--is for Skinkers alone, but is expected to help expedite the launch of LiveStation. (Skinkers also plans to use the cash to expand its enterprise efforts, involving branded desktop news readers.)

Presently in controlled beta testing, LiveStation is an extension of Microsoft's recently launched Silverlight plug-in media player, and is seen as a potential threat to recent Web TV entrants like Joost and Veoh.

But details on the service have been scarce.

"Live TV, this isn't recorded TV being re-broadcast ... it is live, without delay," Don Dodge, a search manager and director of business development for Microsoft's emerging business team, wrote on his blog this summer. "Of course the technology could be modified to stream recorded shows or other types of content."

Microsoft is not the first blue-chip company to enlist Skinkers' services. In 2005, Dow Jones' Wall Street Journal Online launched a Desktop News Alerts service--which, with Skinkers' software, delivered business, tech, and news alerts directly to consumers' desktops.

"We believe [Skinkers'] innovative approach to the delivery of priority information gives them a unique position in the market," said Hitesh Mehta, general partner at Acacia Capital Partners.

Better established in the U.K., Skinkers has also worked with BBC News, BBC Sport, and Sky News.

The live streaming nature of LiveStation clearly differentiates it from rivals like Joost, which stream pre-recorded content.

"TV on your cell phone?" asked Dodge. "Silverlight runs on cell phones, so in the future LiveStation could deliver Live TV directly to your cell phone or mobile device."

LiveStation currently rebroadcasts the BBC live, and is built on two research technologies, Pastry and SplitStream, from Microsoft's Cambridge Research Lab.

"Pastry is a type of P2P system called a 'distributed hash table,' which makes it easier for computers to find and store information, and to organize themselves for collaborative tasks," he explained.

"SplitStream is an application built on top of Pastry which allows real-time streams such as live video to be robustly distributed peer-to-peer."

Microsoft earlier this year launched Silverlight--a plug-in for playing media files and displaying interactive Web applications--as part of a full suite of cross-platform Web development tools for both Windows and Mac operating systems.

The company now faces the daunting task of convincing consumers that Silverlight is superior to established players like Adobe's omnipresent Flash.

Other companies that have offered live television over P2P include RawFlow, MediaZone, and Zattoo.