BitTorrent Inc. is saying good-bye to Sync, the file synchronization tool once pitched as an alternative to Dropbox and similar services. However, Sync isn’t being shut down: Instead, it is spun off into a separate company headed by former BitTorrent CEO Eric Klinker, Variety has learned.
Klinker’s new company Resilio will rebrand Sync as “Connect,” and apparently squarely focus on enterprise file sharing and synchronization needs. Klinker is being joined in his efforts by a handful of other former BitTorrent colleagues, including the company’s former GM of platforms Ilan Shamir.
For BitTorrent, this spin-off is more than just a simple restructuring. Under Klinker, the company tried to incubate a number of new technology initiatives, including Sync, as well as a private messaging tool dubbed Beep.
Separately, BitTorrent was looking to give artists tools to publish and monetize their works by tapping into the company’s massive audience — BitTorrent’s legacy file sharing clients still see some 170 million monthly active users, according to company data. And BitTorrent founder Bram Cohen had been working on a P2P-powered video streaming technology for some time.
However, Klinker shied away from full-on embracing digital media, in part because he was concerned about backlash from rights holders who still view the company as a facilitator of piracy, according to a source familiar with the matter. He instead aimed to paint BitTorrent as a privacy-conscious technology company, providing tools that were less prone to surveillance than products from established cloud storage providers.
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Klinker’s strategy was controversial within the company, especially because it was unclear how much revenue BitTorrent could generate with Sync, which is free for private use. At the same time, BitTorrent’s legacy revenue stream has been on the decline. The company once made most of its money with bundled software, helping Yahoo and others to install their browser tool bars.
This part of its business has virtually disappeared, and advertising within the company’s legacy clients hasn’t been able to replace it. BitTorrent currently sells ads for CPM rates as little as $0.10 on a self-serve basis. As a result, BitTorrent was forced to lay off dozens of staffers last year.
Earlier this year, BitTorrent and its investors made the decision to double down on media in order to bring in new revenue streams. It brought in two new CEOs, and is getting ready to open a studio space in Los Angeles. The company launched its new live streaming app, and there is talk about another media project code-named “BitTorrent Now.”
When BitTorrent announced the new leadership, a spokesperson told Variety that Klinker was staying on in a technical role. With him leaving the company to launch Resilio as Sync’s new home, it’s clear that BitTorrent has decided that its future — and its future revenue — is entirely in media.
A BitTorent spokesperson declined to comment when contacted for this article; Klinker didn’t respond to a request for comment.