Popular BitTorrent clients uTorrent and the official BitTorrent client pose a security risk to users.

According to a report at Torrentfreak, both clients are vulnerable to a remote denial-of-service attack due to the way they handle user-supplied data. Versions found to be vulnerable so far are the official BitTorrent 6.0 client, uTorrent 1.7.x, uTorrent 1.6.x and uTorrent 1.8-alpha-7834.

The flaw allows an attacker to crash the application, however Code execution is not possible, meaning that it’s more of an annoyance than something that should cause BitTorrent users to panic.

Both clients are produced by the company BitTorrent, which has taken $34 million in funding over two rounds from Accel Partners and Doll Capital Management.

Update: Commenter’s suggest there’s already a fix. That was quick, make sure that the BitTorrent client you’re using to download legitimate legal content is up-to-date.

For anyone who thinks that full-length movies on the Web are for downloading only should check out the Watch Now section on BitTorrent (you will need Flash Player 9 installed). Launched quietly on December 5 using its BitTorrent DNA streaming technology, Watch Now offers a few hundred full-length movies and TV shows that you can watch in full-screen that start a few seconds after clicking play. The quality varies based on the original video, but check out The Ring (original Japanese version) to see what is possible. It is not HD. But it is very watchable.

A clickable pop-up toast ad for Take TV appears at the beginning. The company is experimenting with the frequency of the ads. One pops up between every 5 and 10 minutes. The controls are limited. There is pause/play, restart, volume, and full-screen. No fast-forward or rewind. [Update: I stand corrected. There is a tiny, hard-to-find fast-forward/rewind button that pops up when you hover the mouse over the progress bar].

The technology works. Unfortunately, the pickings are slim. Other than The Ring, there is not much worth watching. They do have Fight Club, but it’s the Bollywood version. (BitTorrent’s such a tease). The TV shows are even more obscure. Wooden Clogs anyone? Deep South Wrestling? I didn’t think so. You are better off sticking to BitTorrent downloads for now.

The Watch Now section is really meant to be a showcase for BitTorrent’s DNA technology. “This is a demonstration for us at this point,” says BitTorrent President Ashwin Navin. He is convinced that ad-supported peer-to-peer streaming is the how video will be delivered in the near future across the Web. ABC or Warner Brothers, for instance, could use it to stream long-form videos from their own sites. (NBC is planning on using P2P software from competitor Pando Networks to stream its video). Navin predicts:

The browser-based video environment is going to get a whole lot better. It makes a closed-off client experience a lot less appealing to the consumer. All of our customers are embracing the browser to deliver videos.

Hmm, a closed-off client experience. Who could that be? Maybe it is time for Joost to finally embrace the browser as well.

There’s been a lot of speculation over the future of the music industry and the conversation has begun to shift from “Can they sell DRMed music” to “Can they sell music at all”. Last week Radiohead ran one of the biggest tests of legally distributed free music by letting users name their price for “In Rainbows”, their latest album.

However, free doesn’t seem cheap enough. Despite the potentially free download, over 240,000 users got the album from peer to peer BitTorrent networks on the first day of release, according to Forbes. Since then, the album was downloaded about 100,000 more times each day, totaling more than 500,000. By comparison, Radiohead pushed 1.2 million sales of the album through their site, including pre-orders. File sharing networks are expected to surpass legal downloads in the coming days.

While the numbers may seem drastic, it’s really more a tale of how late to the game the music industry has been. Piracy networks have been growing over the past couple of years, despite the industry’s declared “war” on illegal file sharing. The networks have grown into easy-to-use distribution methods for digital music — even easier than what Radiohead offered. Users could easily grab “In Rainbows” while downloading music from other artists. Radiohead couldn’t be as compelling by only offering their own music and requiring users to take the time to set up an account.

But Radiohead doesn’t have that much to be sad about. The band gets to keep all the proceeds of their digital experiment and has distributed about six times more albums than their last release, which sold 300,000. That seemed to be enough to get EMI thinking harder about changing. Forbes obtained a email form EMI’s chairman saying “The industry, rather than embracing digitalization and the opportunities it brings for promotion of product and distribution through multiple channels, has stuck its head in the sand. Radiohead’s actions are a wake-up call which we should all welcome and respond to with creativity and energy.” So it seems there’s still hope yet that those legal war chests will be put to use on some innovations.

BitTorrent has been getting somewhat of a bad rap. Although BitTorrent itself sells copyrighted content over its P2P file sharing protocol, the service has become better known for less than legal downloads from sites like “The Pirate Bay”. It has been particularly popular for pirating because it easily distributes the cost of transmitting files across the network of users downloading the file.

Now BitTorrent is taking another try at legal torrenting by applying the power of peering to content its partners want to be shared, free files and streaming video. The new service, BitTorrent DNA (Delivery Network Accelerator), uses torrents to assist in sharing these files with their users. It effectively creates a virtual network of viewers’ computers that will share amongst themselves to speed up downloads for popular files from your servers.

The peering arrangement sounds a lot like what BitTorrent currently does, share large files amongst many user. DNA’s big difference, however, is that it does this more transparently. Viewers don’t need to search for tracking files and deal with a torrent download manager, but instead simply install a new BitTorrent client (around 330 K) that handles everything when they come to a DNA enabled site. For example, when you’re on a site and halfway through watching a movie or downloading a file, DNA shares these files behind the scenes with other users that need it too. If you’re concerned about sharing being too much of a drag on your bandwidth, you can go into your control panel and shut off the “download acceleration”.

The main selling point is that BitTorrent should reduce your bandwidth costs, meaning publishers can hold on to more of their ad revenue. The savings is expected to be pretty significant, with BitTorrent saying their customers can shift as much as 80% of their content delivery to the P2P network. Brightcove, one of their launch partners, will be using the peering technology to serve their high bandwidth video content for a new product, “Brightcove Show“.

By teaming up with BitTorrent, Brightcove hopes to take on Joost by allowing its network of Web video publishers to stream broadcast-quality, full-screen videos (possibly even up to HD-quality) without the need for a separate, walled-garden application. The videos will just stream directly from the Web, with bits being pulled from other people’s computers who have the BitTorrent DNA client and have watched a particular video, combined with bits delivered from the Limelight content-delivery network when there aren’t enough BitTorrent peers available to do the job.

Bram Cohen, the creator of the BitTorrent protocol, announced that his company would be finalizing an acquisition of µTorrent today.

“Together, we are pleased to announce that BitTorrent, Inc. and µTorrent AB have decided to join forces,” Cohen wrote in his blog. “BitTorrent has acquired µTorrent as it recognized the merits of µTorrent’s exceptionally well-written codebase and robust user community. Bringing together µTorrent’s efficient implementation and compelling UI with BitTorrent’s expertise in networking protocols will significantly benefit the community with what we envision will be the best BitTorrent client.”

The move will bring quite a few torrent users over to BitTorrent. News site TorrentFreak estimates that buying uTorrent, will bring BitTorrent nearly 50 percent of torrent users.

“What does this mean for the µTorrent community?” wrote Cohen. “Not much, at least not at first. The intention is to maintain the website as it is, and keep the forums and community active. Moving forward behind the scenes, we will continue to develop µTorrent and will be using the codebase in other applications, especially ones where a fast, lightweight implementation is more suitable, such as embedded systems on TVs, cell phones, and other non-PC platforms.”

The acquisition price has not yet been disclosed.

Azureus will launch Zudeo Monday morning, a content indexing site for finding and sharing large video files. The company told TechCrunch on Friday that they would be partnering with 20 major TV and film studios to provide free programs, although they won’t name the partners just yet.

Azureus is known for their peer-to-peer applications and Zudeo will build off of that, allowing users to share their own content. But it will also allow corporate content providers to publish, showcase, and distribute high resolution, long form content. The company says the focus will be on “high quality DVD and HD content.” Essentially, Zudeo is a hybrid of YouTube’s social sharing and a B-to-C content channel.

“Media companies are embracing digital media distribution,” said Jarl Mohn, current chairman of the board of CNET Networks and an Azureus board member, in a release sent to TechCrunch on Friday. “Zudeo provides a very effective and secure P2P platform to distribute content to their audience.”

Azureus said that they are trying to “centralize and go viral.” Each listing will have a user rating and an embed code called Azureus Magnet so that users can share the content on other sites.

Azureus also announced a $12 million round of funding by Redpoint Ventures and BV Capital. This is a heap of cash for a video-sharing site if you consider that YouTube was initially financed for approximately $11 million. Azureus CEO Gilles BianRosa told us that the money would go towards marketing and team building.

Currently, Azureus has 15 employees. The company says that they have had 130 million downloads of their client, mostly from SourceForge.net, and are averaging 500,000 more per week. The company claims to have 15 million unique users.

Azureus’ deal with content providers is where they believe they will profit the most.

“Today, content creators and publishers can use Zudeo to freely promote and distribute their digital creations, with no limitation in length or video quality,” BianRosa said. “Furthermore, they can use our social networking tools to expose their content throughout the web, including blogs and social networks. Similarly, movie, games, and music fans can access a growing catalog of high resolution media content and share it with their friends easily.”

Om Malik posted a rumor today regarding a new BitTorrent financing and possible ouster of CEO Bram Cohen. We did some independent digging and have come up with what I believe is accurate based on multiple sources and a leaked document: BitTorrent has raised a $25 million Series B round of financing from Accel Partners and previous investor Doll Capital Management, bringing the total capital raised to just under $34 million.

And CEO Bram Cohen, who created the BitTorrent protocol, is definitely on his way out. The company has retained the well known headhunting firm Heidrick & Struggles to find a replacement as soon as possible. No word on what, if any, role Cohen will have going forward.

More Upcoming BitTorrent News:

The company is yet to launch a new service to sell licensed video content on its own retail site, and has signed licensing agreements with, among others, Warner Bros. and Paramount to sell movies and TV shows at prices starting at $1 each. The company will also announce deals to put the BitTorrent software on DVRs, cable boxes, and wireless routers, enabling BitTorrent users to download legal movies or TV shows to PCs and TVs.

BitTorrent is making a real effort to stay legitimate and in favor with the RIAA and MPAA, which of course doesn’t sit well with the majority of the world’s 70 million BitTorrent users. Napster failed miserably when they tried to work with the RIAA. We’ll see how well BitTorrent does this time.

Update: In a very tense conversation with Bram Cohen and BitTorrent’s Director of Communications, Lily Lin, today, the company made it clear that Bram is with the company for the long haul. They would not comment on the CEO search.