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Seems like more than one /.er has reported spyware being bundled (specifically Grokster), contrary to the PC Mag reports.
First off, Grokster is not spyware, it is an application that comes bundled with spyware. Second, just because Microsoft's anti-spyware software identifies something as possibly being Grokster doesn't mean anything. The Microsoft software has a pattern list like virus software. It saw something in Mercora that looks similar in design to Grokster and warned the user that he might be installing Grokster. Don't jump to condemning something you know clearly know very little about because of a buggy peice of Microsoft software.
Whether or not the spyware was intentionally bundled
Do you think they could unintentionally bundle spyware?

From the Mercora website: This is not a bait-and-switch "pop-up hell" application! We DO NOT have any Spy-ware or Ad-ware in our software and we keep your personal information confidential. You control what you want to share and what you do not.

Your entire post is based on negative logic. Something that never has happened cannot be proven that it will never happen in the future. So what? You condemn something without any positive proof of anything, because no one can dispute negative logic. Sad. Its simply not right to condemn before taking the time to do a little research into the validity of your allegations.

There's a simple rule of thumb that I tell everyone, and you should too - fancy-pants website + closed-source freeware = bad news.

However, it looks like this one is an exception. The EULA's and legal looks pretty solid. The guys who started it are ex-McAfee employees, with a tidy five million bucks to play with.

I imagine they have bigger plans than a spyware racket with this software, though I have no idea what. I would definately try it, but hell will freeze over before I give up my sexy GNOME desktop :D

There's a simple rule of thumb that I tell everyone, and you should too - fancy-pants website + closed-source freeware = bad news.

However, it looks like this one is an exception. The EULA's and legal looks pretty solid. The guys who started it are ex-McAfee employees, with a tidy five million bucks to play with.

I imagine they have bigger plans than a spyware racket with this software, though I have no idea what. I would definately try it, but hell will freeze over before I give up my sexy GNOME desktop :D

... You are solely responsible for any dealings with third parties (including advertisers) who support the Service, including the delivery of and payment for goods and services.

One may also want to check out Mercora

-dk

Share pictures with friends and family using Mercora P2P Pictures

* Create albums and pictures on your local computer for friends to see
* Decide which of your friends gets to see your various albums using privacy settings for each album

Is broadcasting music on the Mercora network legal? Yes. Mercora has obtained the necessary licenses so that you can broadcast music on the Mercora Network legally.

Specifically, Mercora enables the webcasting of music according to the Digital Millennium Copyright Act, 17 U.S.C. 114 (required Adobe Acrobat to read). Mercora has obtained the statutory license for the non-interactive streaming of sound recordings from Sound Exchange, the organization designated by the U.S. Copyright Office to collect and distribute statutory royalties to sound recording copyright owners and featured and non featured artists. Mercora has also taken care of all U.S. musical composition performance royalties through its licenses with ASCAP, BMI and SESAC. Most song writers are represented by these agencies but there are some who are not affiliated with them, and you will need to obtain their permission before you can webcast their music. Mercora also ensures that any broadcast using the Mercora client adheres to the sound recording performance complement as specified in the DMCA. Read more about broadcasting on the Mercora Network.

Not only on *what* you broadcast, but also *when* you broadcast.
From the legal disclaimer: You may not "Webcast specific sound recordings within one hour of the request by a listener or at a time designated by the listener"

It looks like they do pay royalties to a certain group that represents many artists: Or so they say here

We'll know if it's right by the RIAA factor, being how fast they can get a subpeona out to these guys.

His was not the General consensus. At any given time, about 50k-80k people are using Shareaza. If it was that bad, why would they use it?

The developer (Singular) opened the source because he has a new project, and not as much time to spend improving Shareaza.

Firstly, I'm all for DRM free content too. In all it's entirity, DRM is such a false hope anyway for now.. or for at least as long as we still need to bridge the digital-analog divide in order to render music perceptible to us.

Secondly, on the evils of the record industry and it's plague of the record labels, I think we should do well to ensure that musicians are rightly compensated by making use of services such Divendo and Mercora that are seemingly "non-feudal" and apparentely "more appropriate" in a contemporary context.

.. hardly an improvement over current pricing ..

True and actually more like hardly any improvement on the terrestrial retail model at all.

The real revolution in sharing music and retailing content online is coming from some of the smaller and more innovative (although little heard of) companies like Divendo and Mercora.

I agree with your doubts on the workability of this.

Additionally, I was wondering:

1. If the profits are going to be divvied based on a tracking system, wouldn't a system like that vulnerable to highjacking -- an artist / label setting up multiple download servers transacting between themselves across interchangeable IP address. This is unlike radio, where the control is in the hand of the content pusher and easier to regulate versus here where it is also with content puller too. That duality makes it more vulnerable to hijacking.
2. This would effectively kill the "gatekeepers to the land of distribution" ability of the record-labels -- and that would ensure a serious lack of support from them. The ability of the record-labels is clearly diluted in the age of the internet, but that they still have legality from it. Essentially, atleast in the near term, a solution like this could well plummet to oblivion from lack of a decent library of content in the face of a record-label boycott.
3. There are so many other new solutions coming up that are more bent on driving user choice (versus compulsory / obligatory licensing) and that ensure a more legal regime from incetivizing pay-for-doanloads rather than -- again -- compulsory / obligatory licensing regimes in one form or the other. Incentive driven pay-to-share services that drive consumers to pay will surely be more effective that those that obligate / force them to do so.

I think that the EFF is getting carried away by "rigtheousness" here.